China agriculture modernisation and rural revitalisation-I

The history of Chinese agriculture and agriculture modernisation is very interesting. Once a leader in agricultural innovation, it became a laggard. From known history, it is a well-established fact the Yellow Emperor of China introduced many agricultural practices and the cultivation of crops. He taught skills to cultivate land by using animals.

The wife of the emperor invented methods of rearing silk warms and making silk. However, China could not keep pace and agriculture lost its way to modernisation. The 1700s and 1800s centuries witnessed a noticeable decline. The agriculture machinery, agriculture-related industry and infrastructure could not develop according to needs of the country. The statistics show before the establishment of People’s Republic of China, there were only 36 agriculture machinery-related factories in China.

The dynamics of agriculture sector have started to change since the establishment of People’s Republic of China. The leadership of CPC realised there was a need to tackle issues of the ownership system of agricultural land, procurement quotas, pricing system and low-level scientific development to modernise agriculture.

In this context, the first 5-year plan specially focused on the development of agriculture-related industry and agriculture machinery production capacity. The number of agricultural machinery industry started to rise, and by 1957, China had established 276 factories. It contributed to development of agriculture, meeting the food needs of a huge population and managing inflation

However, agriculture could not attract the required attention during the Great Leap and Cultural Revolution. The labour was moved at a large scale to give a boost to industrial development. It is good to note Chairman Mao soon released the missing link and tried to manage the situation by presenting the “Ten Great Relationships” theory.

Despite initial hurdles, agriculture showed progress on certain indicators between 1957 and 1979. Machine-cultivated land grew from 2.4% to 42.4pc. Irrigated land area increased from 24.45pc to 45.2pc. The use of electricity to irrigate the land increased. The use of medium-sized tractors also increased. Horsepower per hectare of major agricultural machinery grew at an annual rate of 24pc. China’s grain production increased to 285 million tons in 1977.

Moreover, China was able to produce a high-yield hybrid variety of rice in 1973. It was a great achievement: China still celebrates it as a great success story. It revolutionised grain production in the country. There is consensus among the experts and policymakers this led to food self-sufficiency in China.

The reform period introduced a new spirit to modernisation of agriculture. The leadership realised to tackle issues of food availability and food security and put the country on a sustainable development path, China has to reform the agriculture sector. It was also required to end poverty, as in 1978, 63% of the poor were living in rural areas, and the overwhelming majority was attached to farming.

Thus, China introduced a series of crucial reforms and adopted a very aggressive approach to reform agriculture and related industries and departments. It started the reforms by focusing on incentivising the farming community.

First, the agricultural prices were revised, and a semi-market approach was applied. The State increased the quota prices of different commodities in 1979, especially for grains, oilseeds and cotton. It encourages farmers to invest more in agriculture and plays a prominent role in pushing agricultural production. Second, China decreased input prices and erected an enabling environment for the use of inputs. The prices of agricultural machinery, fertilizers and pesticides decreased substantially. It increased farmers’ ability to use more extensive agricultural practices and go for modern inputs. It further gave a boost to agricultural production and modernisation.

Third, land reforms were the most critical part of revitalising agriculture and rural development and encouraging people to invest in agriculture. Land ownership is one of the key areas of interest for top leadership of China from the Chairman Mao era to the President Xi era. It has dual significance for China. On the one hand, the revolution of China was led by the farming community, and they were at the forefront of sacrificing for their dream country. Second, the farming community plays a leading role in ensuring food availability and security.

Therefore, land ownership was always very close to the heart of leadership, and they put special efforts into refining this system. The land ownership reform can be understood by dividing reform periods into categories: 1) three phases of reform and 2) four phases of reform. In the case of three-category reform, the reforms can be understood by dividing them into three phases. The first phase (1949–1952) was dominated by redistribution of land and ownership shifting towards peasants. The landlords were discouraged. In the second phase (1953–1978), reforms introduced collective ownership, and agriculture was put under the communes—the third phase ((1979–present) came up with the idea of household contract responsibility system.

According to the division of reforms into four periods, the reform phases can be divided into 1) feudal (landlord) land ownership to private peasant ownership (1949–1952), 2) primary co-operatives (1953–1955), 3) senior clubs and Communes (1956–1978), and 4) household contract responsibility system (HRS). It is believed the household contract responsibility system played a major role in reforming and modernising the agriculture sector in China.

The initial reform policies helped improve the growth rate and production of agriculture sector. The statistics show agriculture grew at 7.7pc between 1978 and 1984 against pre-reform average rate of 2.9pc. China built on the initial reform and kept moving on modernisation ladder.

The reforms entered into a new phase since the start of 2000s. China started focusing on mechanisation of farming supported by advanced agriculture technology, machinery and inputs. However, it kept a focus on importance of indigenisation of agricultural machinery and technology. The successive leadership encouraged the domestic industry to take a lead in modernisation drive of agriculture. The government provided subsidies to industry and encouraged people to improve industrial machinery output. This helped increase industrial output to Yuan 340 billion ($54.6 billion) in 2013.

Most recently, China has started investing generously in smart agriculture, its related machinery and technology. Some estimates show share of smart machinery, technology and practices was about 5pc in 2024. It is expected it will increase by 20pc in 2030.