In this paper we first discuss, both analytically and empirically, the components of agrarian class structure in India, particularly in terms of use of hired labour and the significant distinction of participation or non‐participation in manual work. We then assess the relationship between agricultural growth and rural proletarianization (with reference to both intertemporal and cross‐section variations), the role of labour market segmentation (when the markets for credit and social insurance are inadequately formed) and the development of class consciousness.