6

Lend Reforms in Pakistan:

A Reconsideration*

INTRODUCTION
Before the introduction of the high-yielding varieties of food
grain in the late 1960s the argument for land reform ‘was a simple
one. It was observed that small farms had a higher yield per acre than
large farms,1 so it was argued that a re-redistribution of owned land in
favour of the smaller mere would improve average yields hi
agriculture. Hence and reforms were considered advisable both on
grounds that they would reduce the degree of inequality of rural
incomes, as well as on grounds of efficiency. The efficiency argument
or land reforms in Pakistan gathered momentum in the 1950s when
agricultural stagnation began to fetter the growth of industry.2
Agriculture provided not only food grains for the rising urban
population but also provided most of the foreign exchange with which
industrial machinery and raw materials were imported. Accordingly,
slow agricultural growth generated both a crisis in the balance of
payments as well as food shortages in the urban sector.4 In such a
situation event the technocrats who were merely interested in the
growth of GNP joined the cry of the social reformers for a land
reform. It began to be seen as a necessary instrument for
accelerating
Note: This paper was originally published in the Bulletin of Concerned
Asian Scholars, January 1984, Colorado, U.S.A.
agricultural growth and thereby releasing the constraint on
industrial growth.
When the Green Revolution technology became
available in the late 1960s, the ruling classes could breathe a
sigh of relief. The new technology made it possible to
accelerate agricultural growth substantially through an ‘elite-
farmer strategy’ which concentrated the new inputs on large
farms. Now the crucial determinant in yield differences
became not the labour input per acre in which small farms
had been at an advantage, but the application of the seed-
water-fertilizer package over which the large farmers with
their greater financial power had superior access. Thus the
technocrats felt that the Green Revolution had made it
possible to accelerate agricultural, growth without having to
bring about any real change in, the rural power structure.
Today after more than decade and a half of the ‘elite-
farmer strategy,’ the imperative of land reform is re
emerging, albeit in a more complex form than in the pre-
Green revolution period. As the large farms approach the’
ceiling on yield per acre with the available technology,
further growth in agricultural output will increasingly depend
on raising the yield per acre of smaller farms.
The small farm sector whose yield potential remains to be
fully utilized, constitutes a substantial part of the agrarian
economy. According to the Pakistan Census of Agriculture
1972, ‘below 25 acres constitute 88 percent of the total
number of farms, an4 57 percent of total farm area. From
the viewpoint of raising the yield per acre of small farms,
the critical consideration is that 54 percent of the farm area
in the small farm sector (below 25 acres) is tenant operated.
Since tenants lose half f any increase in output to the
landlord, they lack the incentive to invest in raising yields.
Tenants also lack the ability to raise yields in a situation
where, because of their financial and social position, they are
unable to ensure optimum quantity and timing of inputs. The
ability of the tenant to invest in increasing yields is further
eroded by a whole nexus of social and economic dependence
on the landlord which deprives the tenant of much of his
investable surplus.
The objective of raising yields in the small farm sector
is clearly inseparable from removing the institutional cone.
trains to growth arising out of the fact of tenancy. A land
Wireworm program that gives land to the tiller is therefore
Essential first step in providing both the incentive and the
ability to the small farmer to raise yields. The imperative for
land reform today arises not only from the need to accelerate
agricultural growth, but also from the need to pre vent the
developing social crisis associated with the impact of the
Green Revolution on Pakistan’s rural society. I shall argue in
the paper that in a situation where the distribution of
landownership was highly unequal the adoption of the preen
Revolution technology set in motion powerful economic
forces which rapidly enriched the large farmers and brought a
sharp increase in rural poverty, unemployment and he
pressure on big urban centers. I shall discuss the’ following
four contradictions generated by the growth process in
Pakistan’s agriculture during the Green Revolution period:
(1) The rapid mechanization of large farms in an
economy characterized by a ‘labour surplus.
(2) The polarization in the size distribution of farms
accompanied by a growing landlessness of the poor
peasantry. The polarization consisted of an increase in
the percentage shares of large and small farms at the
expense of medium-sized farms (8 to 25 acres).
(3) The growth of capitalist farming together with a
growing n: social and economic dependence of the
poor peasantry on large landowners.
(4) An absolute deterioration m the economic condition
of the poor peasants alongside the growing affluence
of the large farmers.
The Attempts at Land Reform and their Failure
Before embarking on an analysis of the four
contradictions specified above and their link with an unequal
distribution of landownership, the land reforms of 1959 and
1972 will be briefly examined.
The Land Reforms of 1959
The 1959 land reforms fixed the ceiling on the private
ownership of land at 500 acres irrigated and 1,000 acres
un1rr1gated The fundamental feature which rendered this
reform incapable of reducing the power of the big landlords
was that the ceiling on ownership was fixed In terms of
Individual rather than family holdings. This enabled most of
the big landlords to circumvent the ceiling by transferring
their excess land to various real and fictitious family
members. Moreover, a number of additional provisions in the
1959 land reform allowed landlords o retain land far in
excess of the ceiling even on an individual basis. For
example, an individual could keep land in excess of the
ceiling so long as his holding was an equivalent of 36,000
Produce Index Units (PIUs). A PIU was estimated as a
measure of the gross value of output per acre of land by type
of soil and was therefore seen as a measure of land
productivity. The flaw in this provision was that the PIUs
were based on repartition revenue settlements. Since the
gross value of output was dependent on the quality of land
and prices, values of PIUs fixed before 1947 would grossly
underestimate land productivity in 1959. M.H. Khan
estimates that even if the PIU values published in 1959
were taken as a correct representative of land productivity,
the allowance of 36,000 PIUs for an individual holding
would leave a substantially larger area than
specified in the ceiling. Another provision which enabled
landlords to retain land above the ceiling s area allowed for
orchards.
Given the fact that In the 1959 land reforms the
ceiling was fixed in terms of individual rather than family
ho1dii and given the existence of additional lacunae in the
provisions, Most big landlords were able to circumvent’ the
ceiling and retain their land without declaring any land In
‘excess of the, ‘Those who actually declared excess and were
super large landlords who even after making use of
exemptions still could not conceal their entire holding. Thus
the average owned area per declarant landlord in Pakistan
was as’ much as 7,028 acres and was 11,810 acres in the
Punjab province. It is interesting that even out of the land
declared in excess of the ceiling only 85 percent (1.9 million
acres) could be resumed by the government. After the
‘government had resumed whatever excess land It could, the
average owned holding retained by the declarant landlords
was as much as 4 acres in Pakistan and 7,489 acres in Punjab
province 6 Thus the land reforms of 1959 failed to have a
significant on the economy power of the landed elite in
Pakistan The final gesture of benevolence by the government
towards the landlords was to be seen in the fact that of the
land (actually reshuffled under the 1959 land reforms, as
much as 7 percent was uncultivated Most of this area needed
considerable land improvement before it could be cultivated
Yet ‘government paid Ra. 89.2 million to the former owners’
as for surrendering land which. was producing nothing.7
The Land Reforms of 1972

The 1972 land reforms shared with the’ 1959 land

reforms the essential feature of specifying the ceiling in
terms f Individual rather than family holdings. However
the ceiling 1972 land reforms’ was lower, being 150
acres for irrigated 300 acres for, unirrigated. The 1972 land
reforms an area equivalent to 12,000 PIUs (with a bonus of
2000 PIUs to owners of tractors or tubewells) which enabled
a de facto ceiling on an individual ownership far above, the
ceiling The refer this discrepancy between. the de jure and de
facto ceiling was that the basis of estimating patterns and
cropping intensities since the 1940s meant that the use of
obsolete PIUs was still the revenue settlements of the 1940s,
The considerable improvement, in yields, cropping patterns
and cropping intensities since the 1940s fl the use. of
obsolete PIUs in 1972 considerably understand, productivity,
M.H. Khan has estimated that; the understatement of land
productivity throughout the PlUs provision, the actual ceiling
in the 1972 land reforms was 466 acres in the Punjab and.
560 acres in Sind for a tractor/ owner. I an owner also took
advantage of the provision for intra-family transfers the
ceiling came to 932 acres irrigated in the Punjab and 1,210
acres in Sind.8
Of the land that was declared above the ceiling by
landlords after making use of the for circumventing the
ceiling, only 42 percent was resumed in the Punjab and i69
percent The area a resumed by the oven1ment under the 1972
land reforms was only about 0.6) million acre s which was
even 1ess than the area resumed under the 1959 land reforms
(which; was 1.9 million acres). The, resumed area in 1972
constituted only 0.01 percent of total farm area in the country
Moreover in the case of the Punjab 59 percent of the area
resumed by the government, was uncultivated. Consequently
the land reforms of “1972, like the land reforms of 1959
failed to affect the power of the big landlords.
 Agrarian Structure and the Impact of the New Technology

The land reforms of 1959 and 1972 failed to alter

significant the highly unequal distribution of
landownership in Pakistan. As much as 30 percent of total
farm area in Pakistan is owned by large landowners (owning
150 acres and’ above), yet these landowners constitute only
0.5 percent of the total number of landowners in the country.9
The overall picture of Pakistan’s agrarian structure has been
that these large landowners have rented out most of their land
to tenants with small and medium-sized holdings.10 In such a
situation when the HYV technology became. Available in the
late 1960s the large landowners found it profitable to resume
some of their rented- out land for self- cultivation on large
farms, using’ hired labour and capital investment.11 It is this
process of the development of capitalist farming 4 which has
generated new and potentially explosive contradictions the
Pakistan’s rural society

Farm Mechanization and the Problem of Employment

During the period when the HYV technology was being
adopted in Pakistan there was also a rapid introduction of
tractors. The number of tractors increased from only 2,000 8
1959 to 18,909 in 1968 The rapid increase in tractors
continued and by 1975 there were 35,71.4 tractors in
Pakistan. Between 1976 and 1981 an additional 75,859
tractors is were imported into the country.12
It is significant that most of the tractors were large
According to the report of the Farm Mechanization
Committee 84 percent of the tractors were above 35
horsepower, 0while only 1 percent were m the small size
range of less than 26 horsepower.13 Two questions arise: why
were predominantly large-sized tractors introduced in a rural
sector where percent the farms are below 25 acres in size14
and why did tractorization occur at all in what is commonly
regarded as a ‘labour surplus’ economy? Both these
questions can be understood in terms of the fundamental
features of Pakistan’s agrarian economy arising out of the
highly unequal distribution of landownership.
First; the distribution of farm area in Pakistan by size
of owned holding is much more unequal than the distribution
of farm area by size of operated holding. My estimates based
on the 1972 Census of Agriculture Show that as much as 30
per cent of total farm area in Pakistan was owned by
landowners in the size class of 150 acres and above; by
contrast the percentage of farm area operated by farmers in
this size class was only 9.2 percent. The difference in the
degree of concentration of farm area between owned and
operated holdings suggests that many of the larger
landowners must be renting out some or all of their owned
area to smaller farmers, This proposition is supported by the
data which shows that the large landowners (150 acres and
above) were even In 1972 the biggest renters out of land,
compared to any. other size class in Pakistan and Punjab
respectively.15
Second, the larger landowners attracted by the high
profitability of owner cultivation following the availability of
HYV technology, tended to resume their formerly rented. out
land for self- cultivation on large farms with tractor Evidence
for the resumption of land during 1960 and 1978 for owner
cultivation on large tractor farms ii provided by field survey
data, which shows that farms in the size classes 50 to 150
acres and 150 and above have experienced a substantial
increase in their area over the period.
In the case of farms in the size clan 150 acres and
above, the increase in farm area over the period 1960 to 1978
constituted half their total farm area in 1978. In terms of the
source of increase, 65 percent of the increase in farm area of
large farms came through resumption of formerly rented-out
land. Thus resumption of formerly rented land was by far the
biggest source of increase, in farm area of large farms (see
Table 1),
There is evidence that the resumption of rentedout
land for self-cultivation on large farms was
associated with
 Table1
Increase in Farm Area since 1960 by Source of increase and
Size Class in 1978 (in Acres)
Increase in farm Area by Source between 1960 and 1978
Size Class Size of Farm Increase in Total Farm Resumption Increase in Net Purchase Net Other
Farm Area Area in of Rented Rented in (Purchase Sources
1960 to 1978 1978 out Land Land Sale)
Small Less than 8 -20 52 4 -5 0 -19
Lower Medium 8 to 25 -25 209 0 -50 0 -33
Medium 25 to 50 +48 407 45 +8 0 -9
Upper Medium 50 to 150 +448 711 340 +24 40 +42
Large 150 and over +3338 6464 2172 +38 1943 -365
* Other source of increase and decrease in farm area are : (1) land
brought by wife or dowry; (2) land appropriated by government,
following land reforms ; (3) farm area reduced through fragmentation
following decision by family members to cultivate individually in
independently operated plots.

Source field survey

the purchase of tractors by those farmers.
My field Survey data shows that whereas in 1960
almost 60 percent of the farmers in the large size class (150
acres and above) were without tractors, by 1978 all of them
had at least one, and 41 percent had three or more tractors.’
Evidence at the all-Pakistan 3vel is provided by the
Report of the Farm Mechanization Committee. It shows that
within the farm area operated by tractor owners, the
percentage area operated by large farmers was as high as 87
percent.
An important reason why large sized tractors began to
get introduced during the 1960a was that large landowners
responding to the new profit opportunities be to resume
rented-out land for s on large farms.: Given the diff of
mobilizing a large number of labourers duril3g the peak
seasons in an imperfect labour market and the problem of
supervising the labourers to ensure satisfactory: performance,
the large farmers found it convenient to mechanize even
though there may have, been: no labour shortage in an
absolute sense.
Polarization in Rural Class Structure arid the
Increase in Landlessness
An examination of Census data for the period 1960 to
1972 shows that in the Punjab province (where the New
Technology had its greatest impact) a polarization occurred
in the size distribution of farms. The percentage shires of
both large and small-sized farms increased while that of
medium-sized farms (7.5 to less than 25 acres) decreased (see
Table 2). This polarization was essentially the result of large
landowners resuming for self-cultivation some of the land
which they had formerly rented out to tenants.17
The process underlying the polarization in rural class
structure was as follows:
(1) Large landowners resumed for self- cultivation
land which they had rented out to both small and lower
medium- sized (7.5 to less than 25 acres) tenant farmers.
However, the resumption hit lower-medium farms to a much
greater extent than small farms due to the considerably
greater degree of tenancy in the former size class.
(2) As tenants operating lower medium-sized farms
lost some but not all of their land following resumption,
many of them shifted into the category of small farms over
the inter- censal period.
The evidence shows that polarization in the size of
farms was accompanied by a growing landlessness of the
poor peasantry. My estimates based on population census
data show that from 1961 to 1973, 794,042 peasants entered
the category of wage labourers, that is, 43 percent of the total
agricultural labourers in Pakistan in 1973 had entered this
category as the result of the proletarianization of the poor
peasantry.
Given the unequal distribution of landownership in
Pakistan, when the New Technology became available, it
induced a process of land resumption by big landlords This
resulted in a polarization in the size distribution of farms on
the one hand and an increased landlessness of the poor
peasantry on the other.

The Growth of Capitalist Farming and the Economic.

Dependence of the Poor Peasantry

The growth of capitalist farming was accelerated

considerably in the late 1 960s as large landowners began to
resume their rented-out land to operate their own farms with
hired
 TABLE 2
PERCENTAGE OF FARMS AND FARM AREA by SIZE OF FARM 1960 AND 1972
In Punjab (ADJUSTED* AND UNADJUSTED Agriculture Census Data

NUMBER OF FARMS FARM AREA

Size of Farm 1960 1972 1960 1972

Unadjusted Adjusted Unadjusted Adjusted
Less than 7.5 63.35 35.53 41.28 19.07 9.93 11.80
7.5 to < 25 29.81 52.82 46.88 45.27 51.15 46.42
25 to < 50 5.42 8.88 8.81 20.21 20.23 21.30
50 to < 150 1.27 2.49 2.72 10.57 12.94 14.94
150 and above 0.14 0.27 0.30 4.88 5.76 5.77
Total 100 100 100 100 100 100

Summary table

Size of Farm NUMBER OF FARMS FARM AREA

(acres)
Col. (a) Col. (b) Col. (c) Col. (d)
1960 (Adjusted) 1972 1960 (Adjusted) 1972
Less than 7.5 35.5 41.3 9.9 11.8
7.5 to < 25 52.8 46.9 51.2 46.4
25 and above 11.6 11.8 38.9 41.8
Total 100 100 100 100

*The columns may not add up to exactly 100 in every case due to rounding errors.

Source: 1960 Pakistan Census of Agricultural and 1972 Pakistan Census of Agricultural
labour and capital Investment. The particular form of the
development of capitalism in Pakistan’s agriculture was such
that instead of being accompanied by a growing
independence of the poor peasantry (as in Europe), in
Pakistan’s case capitalism in agriculture was accompanied by
an increased social and economic dependence of the poor
peasantry on the landowners. The reason i this was that
capitalist farming in Pakistan developed in a situation where
the power of the landlords was still intact. Consequently the
emerging market was mediated by the social and political
power of the landlords. The local institutions for the
distribution of agricultural inputs and credit and of sale of
output, are heavily influenced by the big landlords. In order
to acquire the inputs, credit and facilities for transport of
output to the market the poor peasant has to depend on help
from the landlord. In many cases the poor peasant in the
absence of collateral cannot get credit from the official
agencies at all, and has to depend on the landlord for loans In
addition to this he or she often has to purchase the tube well
water from the landlord and use landlord transport for taking
output for sale to the market. Thus as the inputs for
agricultural production become monetized and insofar as the
access to the market is i1a the landlord, the poor peasant’s
dependence has intensified with the development of
capitalism in agriculture.
With the development of capitalist farming, the poor
peasant is subject to a triple squeeze on his real income 18

First his money costs have increased. Second with the

shift from sharecropping to cash rent in many cases the cash
rent Is fixed in terms of the potential rather than the actual p
of the land. Yet his yields per acre have not increased in
proportion to the rental burden. The third pressure on the real
income of the poor parent is that in a situation of rising cash
requirements and indebtedness, they are forced to sell a part
of their subsistence output at harvest time at low prices.
Then at the end of the year they have o buy grain in the
market at high prices. Thus selling grain cheap, and buying
dear, is another squeeze on the poor peasant’s income.
The squeeze n the real income of the poor peasants is
reflected in the changes in. the quality and quantity of their
diet since 1965. Thee Table* shows that the class of poor
peasant (with farm size below 25 acres), contains a
substantial number of farmers who have suffered an absolute
decline in the quantity ‘of food and contains an even larger
number of farmers who have suffered a decline in the quality
of their diet

CONCLUSION

In Pakistan, with its highly unequal distribution of

landownership introduction of the New Technology in
agriculture has unleashed powerful contradictions which are
not only likely to become constraints on, continued
agricultural growth,, but are also generating acute, social
tensions. The nature of the economic progress, in the absence
of an effective land re is such that it is enriching the rural
elite at the expense of the rapid deterioration in the economic
and social conditions of the majority of the rural population.
Four major contradictions can be seen in the process of
agricultural growth since the adoption of the New
Technology:
First, there has been a rapid adoption of large tractors
in a labour- surplus economy where 88 percent of the farms
are below 25 acres. This has happened as the result of large
land owners resuming their formerly rented-out land for self-
cultivation on large mechanized farms. Labour displacing
technology is being used by large farmers not because there
is
* See table 6 in chapter of this book titled: Behind the veil of
Growth The State of Pakistan’s Economy.

an absolute labour shortage, but in order to overcome the

problem of supervision of labour and the difficulty of
mobilizing labour within a short time period.
Second, a polarization ii the size distribution of farms
baa taken place, with the percentage shares of large and small
farms increasing at the expense of medium-sized farms (8 to
25 acres). This has also resulted from large landowners
resuming their formerly rented-out land. Land resumption hit
medium-sized farms, pushing many of them into the category
of small farms following resumption.
Third, the develop o capitalist farthing has occurred in
a situation where the prevalence of feudal power by the big
farmers has deprived the poor peasant equal access to the
market. Consequently the poor peasant has become more
pendent or the big farmer for conducting his production
process.
Fourth, rising money costs for the, poor peasants —
in a situation where they are locked in a structure of
dependence ---- have placed the poor peasant into a triple
squeeze which is 8ultmg in a rapid deterioration of their
economic condition of the, contradictions specified above
stems from the fact that the New Technology became
available in a situation where economic and social power was
concentrated in the of the big landlords.

Agricultural growth during the 1960s and 197 Os was

d on the rapid increase in yields of the larger farms, but
continued growth in the next two decades will have to
derived from increasing yields per acre of the small farms.
An essential pre-condition for this is 1nstitu economic
changes which will give the small farther better over the new
inputs and greater control over the pro- process and
investable surplus. In this sense, an effective land reform is
now not only an imperative of a more equitable economic
growth but also of growth itself.

NOTES
1. There was a lively debate on the factors underlying the inverse
relationship between farm size and productivity. One of the
more elegant explanations for this phenomenon was offered by
A,K. Sen who suggested that with traditional technology small
family farms could produce a higher yield per acre than large
farms through a higher labour input per acre. This could happen
be cause Rmall farms using family labour applied labor Input
beyond the point where the marginal product equaled the wage
rate, while large farms using hired labour could not afford to 40
so.

2. Annual growth rate of large-scale manufacturing during 1950-55

was 23.6 percent, while that of agriculture during the same
period was only 1.3 percent. During the period 1955-60, annual
growth rate in large scale manufacturing declined to 9.3 percent
while that of agriculture was only 1.4 percent. See S.R. Lewis,
Jr., Economic Policy and Industrial, Growth in Pakistan,
London: George Allen and Unwin Ltd., 1959, p.3, table 1.

3. Cotton and jute constituted 85 percent of total commodity

exports up to the mid 1950s. See S.R. Lewis, op. cit., p.7, table
5.

4. Import of foodgrains and flour as a percentage of total

commodity imports increased from 0.5 percent in 1951.52 to
14.6 percent in 1959-60. See; A Hussain, ‘The Impact of
Agricultural Growth on Changes in the Agrarian Structure of
 Pakistan.’ D. Phil. Thesis, Sussux University, 1980, table 3, p.
16.

5. M Khan, Underdevelopment and Agrarian Structure in Pakistan.

Vanguard Publications Ltd., 1981, chap. 5.

6. Land Reform in West Pakistan Vol. III, appendix 18,

Government of Pakistan, 1967.

7. See MN. Khan op. cit., chap. 5.

8. Ibid.

9. These figures are estimated on the basis of combining Land

Reforms Commission data and the Agriculture Census data. The
1972 Agriculture Census data alone gives an incorrect figure for
land owned by the large landowners because its sampling
procedure is such that absentee land is systematically excluded.
For details of my estimating procedure, see: A. Hussain, op. cit.,
appendix 2, PP. 219.21.

10. As late as 1972, 46 percent of the total farm area in Pakistan was
tenant-operated, and of this tenant area, 50 per cent had been
rented out by large landowners (owning 150 acres and above).
My estimates show that as much as 75 percent of area owned by
large landowners in 1972 was rented out to smaller tenants. See.:
A, Hussain, op. cit., chap. 3.

11. For detailed evidence and analysis of this tendency of land

resumption by big landlords, see: A. Hussain, ‘Technical Change
and Social Polarization in Rural Punjab’ in Karamat Ali (edited),
The Political Economy of Rural Development. Vanguard
Publication, 1982.

12. Finance Division, Economic Adviser’s Wing, Pakistan

Economic Survey 1980-81. Government of Pakistan, Islamabad.

13. Ministry of Agriculture and Works, Report of the Farm

Mechanization Committee, Government of Pakistan, March,
1970.

14. Ministry of Food and Agriculture, Agriculture Census

Organization, Pakistan Census of Agriculture: All Pakistan
Report, Government of Pakistan, table 1.
15. See: A. Hussain op. cit., table 5(a), p. 194 and 6(a), p. 198.

16. A Hussain, op. cit., chap. 5 and Appendix.

17. This picture emerges when the 1960 Census data is adjusted for
biases inherent in its methodology in order to make it
comparable with the 1972 Census methodology. A. Hussain, op.
cit., chap. 3.

18. For and elaboration of the nature of this triple

squeeze on the real income of the poor peasant, see
the chapter in this book titled: Technical Charge and
Social Polarization in Rural Punjab.