Good News For NGOs And Business People

Dr. Khandakar Qudrat-I Elahi
The Daily Star, 09 September, 1997

Recently the government had released the principal findings of the 1996 Agriculture Census. According to the Census, Bangladesh has now 17.59 mill. house-holds (HHs) in the rural areas of which 2.18 mill. are purely landless and 6.47 mill. are involved in non-farm activities. 

The estimate of 19983-84 Agriculture Census was 13.82 mill. rural HHs, of which 1.19 mill. were purely landless and 3.87 mill. were involved in non-farming activities.

The two censuses had been taken in about 12 years apart. How has the picture of rural poverty of our country changed over these 12 years? First of all, while the total number of HHs has increased by 27%, the number of purely landless HHs has increased by 83%. This means that the landless HHs has increased by 3% against an 1% increase in the rural HHs in the country. Second, both farm and non-farm HHs have increased simultaneously: farm HHs by 11% and non-farm HHs by 67%. Thus, the population pressure on the extremely limited agricultural land in the country has continued to increase, although the number of non-farm HHs has increased quite notably. 

The recent census clearly shows that the poverty situation in Bangladesh has worsened significantly over the past 12 years. This information highly contradicts what our NGO leaders and micro-credit gurus have been telling us. In the seminar organized jointly by the British Council and the Credit Development Forum in Dhaka on the 2nd September, the NGO leaders were so proud of their role and achievement in reducing rural poverty all over the world including Bangladesh that they had prophesied NGOs as the "governments in waiting" or the "future private sector in waiting" (The Independent 03 September). 

I do not want to confuse myself by stating that the information revealed by the recent census is a bad news for the economy or the country; because I do not know what that means. However, I do know that the information of enhanced level of rural poverty carries different massages to different groups of people in our society. 

For the vast majority of our people, the information revealed by the recent census is no news at all; because they are the source of the news; therefore, they are themselves the news. The massage they are getting from the information is that their conditions are not going to improve in the near future: They must be prepared for very long days ahead.

But, for two groups of people in our society, the recent census has brought good news. The first group in the list includes of our NGO leaders. As the poverty situation has deteriorated in the country, they will be able to collect more foreign aids for their crusade against rural poverty. They will argue very persuasively that without them the situation would have been much more worse. 

The second group consists of our business people. The world Bank and other donor agencies have now more evidence and ammunition to heighten their pressure for greater structural adjustments in the economy- more privatization and more trade liberalization. Thus, increased rural poverty is a bonanza for our business people. 

I suppose we can think of another group of people in our society to whom the information revealed by the recent census is a welcome news too: these people are our politicians and bureaucrats. They have now more data and evidence to beg for greater international alms. The bigger is flow of international aids in the country, the better-off are our politicians and bureaucrats: They are the people responsible for the distribution of these aids and they know how to keep their share. Besides, our politicians will be able to proudly tell the people how much international alms they have procured for the nation. 

Indeed the revelation of the recent census is a great surprise and shock to the vast majority of the people. This is because our NGO leaders and micro credit gurus have been promising them a very rosy future; they have been told that their future generations have to go to museums to know about rural poverty in Bangladesh. The information provided by the recent census is therefore truly surprising and shocking as it points their future just in the opposite direction. 

I quite clearly understood the philosophy and objectives of micro- credit programmes when they were initiated by FAO in the early 70's. FAO designed a research project on rural credit called "Small Farmers Credit Programme" which it conducted in many developing countries including Bangladesh. The major purpose of research was to create institutions for providing small loans to the rural poor who had been deprived from credit facilities from formal sources due to their socio-economic and political status in the society. 

The objective of these programmes was expressly "Poverty Alleviation"; they were truly considered to be peripheral to the mainstream efforts of governments and official aid agencies to resolve the problems of world poverty, as two established NGO researchers, Roger C. Riddell and Mark Robinson state in their book, "Non-Governmental Organizations and Rural Poverty Alleviation". In other words, these micro-credit programmes were considered as "temporary relief" measures like "painkiller" drugs; the "cures" of poverty situation were thought to lie in changing the socio-economic environment. These "cures" must be provided by the governments through undertaking appropriate social and economic policies.

All these have dramatically changed in the early 90's. Norman Uphoff of Cornell University in USA, an authority on NGO theories, designates the NGOs as the "third sector" of the economy working side by side with two other sectors: the "public sector" and the "privet sector". The world Bank has accepted the NGO approach as one of its basic strategies for Third World development; universities now run courses and seminars for students and aid officials; development journals are publishing more articles on NGOs, occasionally devoting a whole issue to the subject; the NGO community has established their own developmental journals and funding agencies are providing money for research on what has now become mini-growth industry.

OECD estimated over 2500 NGOs in 1988 in the leading western industrialized countries engaged in international assistance. UNDP (1993) estimate, thought to be highly conservative, was 50,000 NGOs located in the developing countries; this number will increase by hundreds of thousand when one includes the diffident types of grass-root NGOs. In 1993, these NGOs transferred some $6.3 bill. to the developing countries; officials aid agencies now channel 10% or more government funds through and to NGOs. Above all, the international micro-credit conference concluded recently in the US capital had assembled world leaders and mobilized their supports behind the programme for raising billions of dollars in future.

Thus, the micro-credit approach, which was once conceived as a "painkiller" has now been elevated into a major "cure" for Third World poverty. In other words, the micro-credit approach has transformed from a simple "Poverty Alleviation" measure to the major "Poverty Elimination" approach.

This really puzzles me; I have failed to understand how a "painkiller" could turn into the "cure" of the disease.

We know of three facts of our life which determine our destinies in the society. First, we, humans, are social beings by nature and by necessity: We must live in a society for both satisfying our natural instincts and for our own protection and survival.

 Second, we, humans, are selfish by nature: We are always motivated and propelled by our self-interests. Finally, we, humans, are not voluntarily poor; there are of course few exceptions. Thus, being poor and living a lower-quality life are against our nature.

If we combine these three facts of our life, we will come up with one conclusion: Poverty, by which we mean lower quality of life suffered by the vast section of our population, has been created by the society. Society creates poverty by originating laws and institutions which prevent these people from making efforts for improving their lots and force them accept the quality of life they do not want and like. Thus, the "Cures" of poverty lie in changing the laws and institutions which are responsible for creating it in the first place. The sooner we understand this reality and the sooner we can clear out our conceptions and consciences, the sooner we will be able to eliminate poverty from our society.

 The NGO approach must be treated as a "painkiller" not as the "cure" for rural poverty in the society.

The author is a visitor, Department of Economics, University of Guelph, Canada.


Update: 20 November 1997