Agrarian Measures of Congress Ministries

The Congress ministries that assumed office in eight provinces in July 1937 faced an acute agrarian crisis caused by the Great Depression, heavy land revenue demands, rack-renting, and rural indebtedness. Peasant distress had led to widespread agitations organized by regional Kisan Sabhas. Guided by the Karachi Resolution of 1931 and the Faizpur Agrarian Program of 1936, the provincial administrations enacted legislation to grant occupancy rights to tenants, scale down rural debts, regulate moneylending, and abolish illegal cesses. Operating under constitutional limits and colonial executive oversight, these measures provided partial relief to the peasantry before the ministries resigned in late 1939.

Context and Agrarian Agenda

Background of Peasant Distress

The Great Depression of 1929 drastically reduced agricultural commodity prices across India, doubling the real burden of land revenue and rent on smallholders. Landlords (zamindars, taluqdars, and malguzars) frequently evicted tenants for rent defaults and seized lands. Rural moneylenders charged high interest rates, leading to mass land transfers from agriculturalists to non-agriculturalists.

Faizpur Agrarian Program (1936)

The Faizpur Session of December 1936, presided over by Jawaharlal Nehru, was the first Congress session held in a rural village. It adopted a detailed agrarian program that guided future provincial legislation. The program demanded a 50 percent reduction in land revenue and rent, exemption of uneconomic holdings from land tax, abolition of forced labor (begar), fixity of tenure for tenants, and statutory scaling down of rural debt.

Major Tenancy Reforms Across Provinces

United Provinces Tenancy Act (1939)

The United Provinces ministry, led by Premier Govind Ballabh Pant, introduced the UP Tenancy Bill to reform the agrarian structure dominated by powerful taluqdars of Oudh and zamindars of Agra. Enacted in 1939, the Act conferred hereditary occupancy rights on statutory tenants and statutory tenants’ heirs who had held land for a specified duration. It restricted the landlord’s power to evict tenants arbitrarily, capped rent enhancement, and banned illegal cesses (abwabs). The law also prohibited forced labor (begar) and restricted the distraint of tenant crops for arrears.

Bihar Tenancy Reforms and Bakasht Lands

In Bihar, Premier Sri Krishna Sinha’s government addressed the issue of bakasht lands—lands previously cultivated by tenants but resumed by landlords during depression defaults. The Bihar Tenancy Amendment Act of 1937 and 1938 reduced rents to pre-depression levels and restored bakasht lands to original tenants under specific conditions. The Act abolished the practice of summary distraint of crops by landlords and capped interest on rent arrears at 6 percent per annum. To secure landlord support in the legislative council, the ministry negotiated the Bihar Congress-Zamindar Agreement, which diluted some radical provisions and drew sharp opposition from peasant leaders.

Reforms in Bombay, Madras, and Central Provinces

In Bombay Presidency, Premier B.G. Kher’s ministry passed the Bombay Small Holders Relief Act to prevent smallholders from being evicted for default on agricultural loans. The government also restored lands confiscated from satyagrahis during the Civil Disobedience Movement in districts like Bardoli and Kheda. In Madras Presidency, the C. Rajagopalachari ministry appointed the Prakasam Committee to investigate agrarian conditions in estate areas, which recommended passing land ownership to tenant cultivators. In the Central Provinces and Berar, amendments to the Land Revenue Code restricted the arbitrary powers of malguzars.

Rural Debt Relief and Anti-Moneylending Legislation

Debt Conciliation Boards and Interest Caps

Provincial governments established statutory Debt Conciliation Boards to arbitrate settlements between indebted farmers and moneylenders. These boards scaled down principal loan amounts based on the borrower’s repaying capacity and permitted long-term installments. Ministries passed laws requiring all professional moneylenders to register with state authorities, maintain audited account books, and issue official receipts to debtors.

Specific Provincial Laws on Rural Indebtedness

The Madras Agriculturists Relief Act of 1938, pioneered by C. Rajagopalachari, wiped out all outstanding interest on debts incurred by agriculturalists prior to October 1, 1932, if the principal had been repaid. For subsequent debts, it capped interest at 6.25 percent per annum. The Bihar Money Lenders Act of 1938 limited the maximum rate of interest charged by private moneylenders to 9 percent for secured loans and 12 percent for unsecured loans. In Bombay and the Central Provinces, similar moneylending regulations prohibited the compound interest system (damdupat rule, where interest could not exceed the principal amount).

Agrarian Legislation by Congress Ministries (1937–1939)

Limitations and Conflict with Peasant Organizations

Structural Constraints and Moderate Policies

The agrarian reforms of Congress ministries suffered from several limitations imposed by the Government of India Act 1935. Ministries lacked complete financial autonomy and could not abolish the zamindari system outright due to property protection clauses in the 1935 Act and landlord majorities in upper legislative houses (bicameral legislatures existed in UP, Bihar, Madras, Bombay, Bengal, and Assam). Congress leadership pursued a policy of class compromise, seeking to balance tenant interests without alienating patriotic landlords.

Opposition from All India Kisan Sabha

The moderate pace of reform caused friction with radical peasant organizations. The All India Kisan Sabha (AIKS), established at Lucknow in April 1936, demanded the immediate abolition of zamindari, total cancellation of peasant debts, and redistribution of land to agricultural laborers. Swami Sahajanand Saraswati, President of AIKS, led major peasant demonstrations against the Bihar ministry for compromising with landlords. In response, the Bihar Provincial Congress Committee banned Congress members from joining or supporting Kisan Sabha agitations in late 1937.

Key Historical Facts for Revision

• The Karachi Resolution on Fundamental Rights and Economic Programme (1931) laid the initial blueprint for Congress agrarian policy.
• The Faizpur Session (1936) was the first Congress session held in a rural area and formulated the 13-point Agrarian Program.
• Swami Sahajanand Saraswati founded the Bihar Provincial Kisan Sabha in 1929 and served as the first President of the All India Kisan Sabha in 1936.
• N.G. Ranga served as the first General Secretary of the All India Kisan Sabha established at Lucknow in April 1936.
• The Prakasam Committee was set up by the Madras Ministry under T. Prakasam to report on conditions of land tenure in estate areas.
• C. Rajagopalachari introduced the Madras Agriculturists Relief Act of 1938 to scale down rural debts and cap interest rates.
• Bakasht lands referred to self-cultivated lands of landlords that had been seized from tenants during rent defaults during the Great Depression.
• The Bihar Congress-Zamindar Agreement was negotiated by Rajendra Prasad and Azad with Bihar landlords to pass modified tenancy bills through the legislative council.
• All Congress provincial ministries resigned in October-November 1939 in protest against Viceroy Lord Linlithgow involving India in World War II without consulting provincial governments.