A favourite theme of the Chinese Communist Party (CCP) and the Sinophiles is that China has lifted out of poverty 700 million of the 800 million poor people during the 40 years of reforms and opening up of the economy after Deng Xiaoping modified the ideology of the communist state to “socialism with Chinese characteristics”. Leaving aside the ideological jargon for the moment and focussing on the statistics embedded in this claim, some facts stand out. Forty years ago, it was the year 1980. China came under communist rule in 1949, that is, 31 years before 1980. Thus, after three decades under the ‘pro-peasant-worker and anti-bourgeoisie” rule, there were 800 million poor in this “People’s Republic”. The population of China in 1980 was a little more than 980 million. Presuming that future growth in population did not boost the number of poor Chinese, it shows that 81 percent of China was poor after 30 years of Communist rule. Of course, statistics regarding China are never sacrosanct and authors Zheping Huang and Tripti Lahiri in their 2017 article estimated the poverty level in 1981 to be 90 percent, when for the whole world, the figure was around 40 percent. China is touted as a success story because the world figure today is 10 percent while China is at 2 percent.

This is good as far as it goes but it does not go very far. Poverty is a relative concept. People living on $300 per month in a hypothetical place where half the population lives on $100 per month, do not feel they are poor. The same people living in the USA (where the national minimum wage is more than $1400 per month) will be considered absolutely destitute even after adjusting for purchase power parity (PPP). After Deng’s reforms, as usually happens, those in proximity to the seat of power predominantly cornered the wealth generated. As a result, the income inequality, which was already high before the reforms, boomed. A study by researchers at the London School of Economics and Political Science estimated that in China, “the share of national income earned by the top 10 percent of the population increased from 27 per cent in 1978 to 41 percent in 2015, while the share earned by the bottom 50 per cent dropped from 27 per cent to 15 per cent.” Thus, the bottom 50 percent, who used to have the same share as the top 10 percent, saw their share reduced 2.7 times over these 37 years of ‘socialism with Chinese characteristics”

From the time of Mao’s advent, until Deng’s reforms, China remained a predominantly rural country with 80 percent of the population living in rural areas. The policies remained focussed on agriculture but with disastrous results when the Great Leap Forward of Mao led to the Great Chinese Famine of 1958 to 1962, which is considered as one of the deadliest man-made catastrophes in human history. Due to the Bamboo Curtain, as secretive China was then called, the true human toll is not known and the estimates vary between 15 and 55 million human lives lost to starvation. With Deng’s reforms, there was a surge in industrialisation and urbanisation and the rural population dropped to around 40 percent of the total. The focus has shifted entirely to industry and the service sector and agriculture has gone through a period of serious neglect. The huge overall economic growth has rendered the poor, who were always concentrated in the rural areas, even poorer, relative to their urban cousins. It is mainly these rural poor about whom Prime Minister Li Keqiang recently said that 40 percent of the Chinese people live on a monthly income of $140. Evidently, these poor cannot live in cities because this figure represents the rent of a one-room apartment in an average city.

The poverty of the rural areas was exacerbated by the one-child policy and migration of the younger population to the urban sprawl. When the only child migrated in search of affluence, the farm suffered. During a visit to some villages in China in 1993, the present writer saw untended orchards where unpicked fruit was rotting. Lack of educational facilities in the rural areas had sent the young to cities and lack of medical facilities had crippled the old. Some rural families showcased themselves to the tourists and earned some money by serving the cuisine of rural China but the neglect of agriculture was evident. Historically, Chinese society has strong filial bonds and the young kept sending money to parents and grandparents in the villages but that was sufficient only for sustenance, with nothing left for making capital investment on the farm. The one-child policy added to the woes as that child now had to support parents and four grandparents. While the official CCP propaganda shows harvesters reaping large commune farms, in reality poor farmers own small parcels of land and work these by hand and sometimes, with animal power. A YouTube video, “Farmers of Tuanshan” gives a good idea of conditions in which farmers live and cultivate their fields in this village famous for its heritage homes.

Lack of capital is not the only reason for poor investment in agriculture. In China, all land vests in the state or in the CCP-controlled collectives and farmers hold it on a kind of lease. Whenever the land is needed for an infrastructure project, an industry or for urbanisation, it is taken away by the state without notice and without giving alternative land, rendering the family unemployed. Even the rural homesteads are taken away and demolished at short notice rendering people homeless. The alternative offered is an apartment that is too far away, too expensive and unsuited to the needs of a farmer. Most of them lose the right of any redress as they are coerced into signing an “agreement” to surrender their land. The National Public Radio (NPR) reported the case of Liu, a farmer in Shandong province, who returned from a walk to find demolition crew preparing to level his home. When he went to the police for help, he was arrested on charge of obstructing the work of state officials. He was released the next day after the demolition was over. A study concluded that only in 22 percent of the cases were the farmers consulted about their compensation.

All these factors have resulted in a situation where the country with the largest population in the world cannot produce enough food and has to rely on imports. It is a different matter that huge surpluses in countries like the USA, Australia and Canada actually gave leverage to China and threats used to be issued to cut-off food imports if any of these countries became too critical of China on any issue. The situation is undergoing a change after the Covid19 episode. In the second part of this article, we shall show how China is anticipating food shortages in the coming years.