[Assam] The Assam Tribune Editorial: Dr Yunus and the Grameen Bank

[Rini Kakati]

 Guwahati, Sunday, December 09, 2007
 
EDITORIAL 



Dr Yunus and the Grameen Bank— HN Das
The award of the Nobel Peace Prize for 2006 to Dr Md. Yunus and his Grameen Bank of Bangladesh (GB) will be remembered the world over as the culmination of more than 30 years of struggle by this great man to help the poor families of his country to cross the poverty line. Earlier he had been awarded a large number of prizes by different countries and institutions for the unique achievements he had made in this field. Business Week has named him as one of “the greatest entrepreneurs of all time.” Dr Yunus’s GB has crossed a milestone when it reached 5 million members and US$ 5 billions in cumulative loans disbursed in August, 2005. It has further progressed from that point and by August, 2007 reached the figures of 7.27 million borrowers and US$ 6.44 billions in cumulative loans disbursed. GB has now 2,459 branches, 1,33,429 Centres and 11,50,719 Groups. GB has almost covered Bangladesh by spreading to 79,539 villages. The poor in that country have been provided with 6,48,918 houses built with GB loans amounting to US$ 204.55 millions. The cumulative number of student loans reached 18,247 and the amount disbursed was US$ 8.14 millions. The number of scholarships granted was 50,025 through an amount disbursed of US$ 0.66 millions. A total of 2,94,801 telephones have been installed in the villages which now facilitate communication with distant places and provide income to village women (Telephone Ladies) who own these telephones. A total of 84,562 beggar members have been granted US$ 1.51 million as loans. These figures are impressive indeed. However, the actual achievements behind these figures need exploring in order to unravel the real service provided by GB. It has to be mentioned that Bangladesh has a huge population of probably 150 to 180 millions steeped in poverty and ignorance. GB has touched only a section of this population. But GB’s member households, which have been enabled by GB loans to come out of the poverty syndrome have become assets to the country. Most of their children are no longer illiterate nor do they have to fear hunger. Those who have received scholarships or taken loans for higher education have become doctors, engineers and other professionals. They can now hope to become the leaders of their communities and their country. Self owned businesses, however small, and self owned houses, however tiny, bring to the poor people security and stability which encourage them to look to the future with hope. They no longer fear hunger, drudgery and uncertainity. Women have come out of purdah to work and earn outside their homes, outside their villages. They have thrown off the stranglehold of the mullahs. Children and youths have become free to go out and work anywhere in the world. Families need not worry about the scourge of dowry any more. GB and Dr Yunus have provided large numbers of Bangladeshi poor with socio economic stability besides livelihood. They are slowly but steadily transforming Bangladesh. Dr Yunus sees GB as “a social business institution owned by the borrowers.” Therefore, GB looks after every aspect of life and not just at the loans disbursed. Dr Yunus could proudly announce that “Bangladesh is the learning ground for the world. Our young people who made it happen make us proud. They have made the whole world look at Bangladesh with the hope for creating a new financial structure.” (Grameen Dialogue. No. 63. April,2006) This writer visited Bangladesh in 1996 and met Dr Yunus. He also saw the work of GB in the villages and talked to the local people. Many things have happened in the meantime. Micro credit has spread to many countries. The total disbursement in these countries is US$ 1.44 billions to 28,67,883 members. These figures are upto January, 2006. GB’s Grameen Trust has provided seed capital to 132 projects and scaling up funds to 53 projects in 37 countries of Asia and the Pacific, Europe, Africa and Latin America upto February, 2006. Meanwhile a United Nations backed project has been launched by UN International Fund for Agriculture Development (IFAD). It will provide US$ 35 millions to 1,20,000 Bangladeshi micro entrepreneurs to expand and develop their micro-enterprises. Moreover, Dr Yunus has initiated Grameen II as a second line of credit. In India the scheme for Self Help Groups was started in a big way with elaborate and comprehensive guidelines. It is called the Swarnajayanti Gram Swarojgar Yojana (SGSY). There is a small urban counterpart also. The beneficiaries are called the Swarojgaries. The groups consist of 10 to 20 beneficiaries normally. The objective is to bring the Swarojgaries “above the poverty line by ensuring appreciable sustained level of income over a period of time.” This is to be achieved by “organizing the rural poor into Self Help Groups (SHGs) through the process of social mobilization, their training and capacity building and provision of income generation asset.” The effort is “to ensure the development of sustainable micro enterprises.” SGSY is implemented “by the District Rural Development Agencies (DRDAs) through the Panchayati Samithis and, with the active involvement of other Panchayati Raj Institutions, and Banks, the line departments and the NGOs.” For planning, implementation, monitoring and evaluation Committees have been appointed at state, district and block levels. Even at the Government of India (GOI) level a Committee has been formed for this purpose. SGSY cells have been set up at different levels in the Banks. The assistance to SHGs has both a loan and a subsidy component. Banks are very closely linked to the entire scheme. According to evaluation made by GOI the average income of beneficiaries under SGSY is steadily rising. The average annual incremental income has been estimated at Rs. 8,800 for individuals and Rs. 34,930 for groups. About 93 per cent of total swarosgaries are reported to belong to below poverty line (BPL) families. Out of the total beneficiaries 64 per cent are women. Repayment is reported to be 79 per cent. It is claimed that 37.24 per cent of the individuals and 15 per cent of SHGs have “crossed the poverty line due to SGSY activities.” But it has been reported that “the major complaints” by “the district authorities include non-cooperation from the Banks, delay in Bank procedure and delay in disbursement of the assistance.” Two other important observations are that “more than 2/3rd of the districts face problems in operationalising the scheme” and that “formation and evaluation of SHGs are observed to be rather slow in most of the districts.”GOI’s scheme is different from GB’s in several essential respects. It is completely bureaucratic and standardised. There is no personal touch. The groups (10 to 20) are larger in India compared to those in Bangladesh (5). The subsidy element plays a very important role in India. There is no subsidy in Bangladesh. The Banks in India have still the traditional attitude and the orthodox approach. They are very different compared to GB, where Branch Managers and Bank Workers perform their jobs with missionary zeal. In India there is neither the growing up from the bottom or from the grassroot level nor the fervour of a popular movement. The entire work is performed by government departments and officers in their usual bureaucratic way. There are only a few Indian micro credit organizations which follow the Bangladeshi model. Grameen Trust has listed only 22 of these. Among these is the one run by social activist Ella Bhatt which has brought succour to some of the poorest families in the western part of the country.Recently GOI have decided to set up two funds with Rs. 500 crores each to facilitate availability of micro credit to the poor. These funds will be, respectively, called Financial Inclusion Fund and the Financial Inclusion Technology Fund. It is expected that when these two funds are operationalised many of the marginalized families below the poverty line will be benefited. However, India will need much more effort to reach all the BPL people who form 21 per cent of the population according to the latest Planning Commission estimates. In Bangladesh GB has stopped accepting any donor money or any loans. This is a very important decision. GB generates enough internal resources which is sufficient for providing loans to the new borrowers. This is a great achievement for GB. Another achievement is that GB has inspired almost a thousand other NGOs to take up micro-credit. India is a very big country with more than 25 crores of people below the poverty line. But Dr Yunus feels that “India is way behind. There is plenty of room in India for micro-credit to grow, develop and flourish.” (Grameen Dialogue. No 63. April, 2006). Recently in Pune Dr Yunus also opined that “India should frame a separate microfinance law since it is impossible to take the financial services to the grassroot level with the existing frame work.” (The Economic Times. November 19, 2007). It is time that India gears up and reorganises the micro-credit programme taking Bangladesh as the role model.
(The writer was Chief Secretary, Assam, during 1990-95)







_________________________________________________________________
The next generation of MSN Hotmail has arrived - Windows Live Hotmail
http://www.newhotmail.co.uk