Essay on the anti-poverty policies in South Asia

The perception of policymakers and economic analysts regarding appropriate policies for alleviating poverty has undergone significant changes over the years.

Till the early 1970s, the dominant ideology governing development efforts was that economic growth would lead to a ‘trickle down’ and ‘spread’ effect benefiting the poor. Rural development efforts during this period, such as Community Development Programmes in India and Village Aid Programmes in Pakistan aimed at increasing access to education, health, housing and social welfare, they did not explicitly aim at poverty alleviation.

The pressing objective of these programmes was to increase agricultural production. By the early 1970s, it became clear that the process of economic growth had bypassed the rural poor, and in some cases had even worsened their condition.

A series of developmental studies highlighted that economic growth, by itself, cannot lead to redistribution of assets or incomes and that the condition of the poor will remain largely unaltered. Pakistani economist and the author of Human Development in South Asia aptly remarked, “my own ruae awakening came quite early after a decade’s experience with Pakistan’s development planning- After generating a GNP growth rate of 7 per cent per annum during 1960s, our team of young and enthusiastic economic planners was getting ready to a bow on the national stage in 1968.

It greatly puzzled us that the majority of the people were not as impressed with the quantum of growth as we were and instead were asking for an instant demise of the government. What had really happened was that while national income had increased, human lives had shriveled, as the benefits of growth had been hijacked by powerful pressure groups”. Therefore, it is not just the pace of economic growth that matters for poverty alleviation, but also the kind and quality of growth.

It is in these circumstances that redistributive measures to address the problem of poverty alleviation gained popularity. Since the late 1970s, most South Asian countries launched special policies and programmes aimed at poverty alleviation and rural development. In a significant departure from the past, this phase saw the involvement of a number of non-governmental organisations (NGOs) in poverty alleviation and rural development programmes.

The NGOs came to the fore in the late 1980s, when there was a decline in the expenditure on social sectors in most countries in South Asia because of adverse external trade environment and debt crisis. Policies that are concerned with the issue of removal of poverty may be broadly classified as falling under three groups. First, there is the set of policies which are directly oriented towards production and income generation such as tenancy and land reforms which increase the asset base and productivity of the poor.

A second set of policies that affect the flow of incomes or consumption to individuals or households include employment and wage employment. A third set of policies relate to public expenditure schemes which seeks to provide certain basic infrastructure and amenities such as rural roads and drinking water supply, which are essential for improving the living conditions of the poor. Let us examine a few policies and programmes aimed at poverty alleviation in South Asia.

Land Reforms

Most South Asia countries embarked upon land reforms soon after independence. The ceiling-cum-redistribution policy is by far the most radical in nature, yet one that has been least successful in practice. Indian land reforms began in the 1950s. By the mid-1980s about 1.5 percent of the cultivated land was acquired under ceiling laws and less than 80 per cent of it was actually distributed.

Moreover, since the amount of land available for distribution was itself small, the total number of beneficiaries amounts to a minuscule proportion of poor households. The record of Bangladesh is even more dismal. The excess land over the stipulated ceiling would have amounted to no more than one per cent of the cultivated land even if the ceilings were strictly enforced. In practice, ^0rily 15 per cent of the potential has been distributed. In Nepal, the results of the most comprehensive land reforms programme through Land Acts of 1964 have been equally dismal.

Only 3 per cent of total cultivated area was found to in excess of the ceilings. The area that was redistributed was 23,588 hectares. In Pakistan, land reforms of 1959 resulted in acquiring only 2.50 million acres, representing about 4 per cent of the then cultivated land. In the next phase of land reforms in 1972 and again in 1977 another five per cent of cultivable land was resumed for redistribution.

Sri Lanka’s achievements appear to be more remarkable. As much as 20 per cent of the cultivated land was promptly acquired following the legislation of 1972 and 1975. But the landless and small peasants gained very little-only 12 per cent of the land acquired, which amounts to 2.4 per cent of the land cultivated land, accrued to the peasantry. The reason is that the reform was aimed mainly at the plantation sector only one per cent of the paddy land was acquired in the process.

The bulk of the plantation land came under state run corporations which did very little to enhance the control of the landless poor. The general picture all over the region is thus one of negligible impact of redistributive land reforms.

In general, the-stipulated ceiling was too high to release adequate surplus land. Even the meagre amount of land that should have been legally available, could not be fully acquired as the land owners made use of various legal loopholes such as benami transfers to keep possession of land. Further, much of the meagre land actually surrendered was found to be extremely poor, made up of ditches, marshes and waste land.

Tenancy Legislation

Most South Asian states have enacted legislations providing for ownership rights to tenants as also determining the sharecropper’s share of the produce. These legislations however not only failed to improve the tenants control over I land, but in fact, made their condition worse by promoting large scale eviction, Given the existing ownership rights and the acute land hunger on the part of the landless and marginal peasants, the mere existence of legislation is not enough. The tenants must have countervailing political power at the local level to neutralize the preexisting superior power of landlords.

Further, even if the tenants get access to land, they will need new sources of consumption loan, working capital loan and other elements of subsistence insurance which will no longer be forthcoming from the landlord. It is precisely the non-fulfillment of these two conditions that led to almost complete failure of tenancy reforms in most South Asian countries.

Policies promoting self-employment by Strengthening Asset Base

Given the acute shortage of land, a number of poverty alleviation schemes have emerged which seeks to promote self-employment in non-farm activities by strengthening the asset base of the poor. Case studies of schemes in South Asian countries arc examined.

The Grameena Bank (GB), a voluntary organisation which emerged in Bangladesh in the mid-seventies, became a novel antipoverty programme in the country. It was aimed at the bottom 40; per cent of the rural population in selected areas of the country. Its target group generally covers households who own no more than half an acre of land. A GB takes banking services to the door step of the target groups through its workers who attend weekly meetings of loanees, at which credit is disbursed and installments of loan repayments are collected. GB has progressed rapidly and by the end of 1984 had come to cover 2.5% of all the village of Bangladesh.

A notable feature of GB is that about 51 per cent of its members are females who receive about 37 per cent of total loans disbursed. GB loans are being used basically for undertaking rural non-crop activities such” as trading, shop keeping, processing and manufacture of livestock and fisheries. It is significant to note that GB has encouraged higher female participation in non-farm activities. The per capita incomes of loan households have ‘increased more rapidly as compared to non-loan households.

It is noteworthy that this has been very high. GB has thus succeeded in giving income support to the poor without degenerating into a dole giving institution that so many other poverty alleviation programmes have tended to become. It must be noted however, that so far GB covers only a small proportion of the total population of Bangladesh and the question arises whether it can be replicated widely to produce a significant impact on poverty alleviation at the national level.

Integrated Rural Development Programme (IRDP) was conceived as an ambitipus anti- poverty programme in India’s Sixth Five year Plan (1980-85) and was designed to help 15 million families in rural areas to rise above poverty line. IRDP provided the eligible families with financial assistance, by way of both loan and subsidy, to enable them to acquire productive’ and income generating assets.

The programme marked a distinct departure from the earlier plans in which poverty alleviation was taken up largely on the fruits of overall development. Most case studies on IRDP concede the success of the programme in raising the level of income of a large number of targeted beneficiaries. However, the evaluation reports of the IRDP have highlighted a series of administrative and organisational weaknesses.

Block-level machinery was found to be quite weak for providing appropriate and integrated delivery system. As the bulk of the beneficiaries were identified by block development officials, and not by elected village assemblies, the proper targeting of more deserving households was not possible.

Another drawback of IRDP was the preponderance of schemes of assistance in the primary sector and that too in the animal husbandry sub sector. The programme floundered in many cases because of the low level of investment and non-availability of good quality animals. The programme did not provided for feed and fodder and the beneficiaries were unable to market ^their product, especially milk.

The beneficiaries were handicapped in respect availability of raw materials, access to working capital and lack of structural facilities in terms of marketing. Consequently, the initial increase ‘ⁿ incomes could not be sustained over longer periods. What is further heartening is that the majority of the beneficiaries have credit overdue.

Attempts are now being made to plug loopholes and leakages in the programme and integrate them along with sect oral and area development programmes into a comprehensive form of integrated development of each area.

The Small Farmers Development Programme (SFDP) in Nepal is also a credit- based programme intended to raise the productivity of the small and marginal farmers. SFDP launched during the fourth Plan (1970-75) has been a major programme where the thrust was multi-sectoral and it used as its base a group of villages.

The objective of the programme was to channel available resources and services to small farmers so as to raise their standard of living. Group responsibility on group-decided projects promoted the spirit of coopcation. By the end of the 1970s, there were 24 SFD programmes including nearly. 7000 farm families.

Evaluation reports have found that participants in SFDP were better off with an average household income of 24 per cent higher than the non-participants. This had a favorable impact on the access to food of small farmers included in the programme.

Though the SFDP has had a positive impact, it is not without limitations. The problems of the programme as identified by farmers and group organisers, relate to lack of clarity about the objectives of the programme, complicated loan procedures, misuse of loans, large farmers taking advantage of the programme, and high rate of mortality of livestock because of poor support services.

Wage Employment Schemes

Food for Work Programme (FFWP) was introduced in Bangladesh in the mid- ; 1970s with a view to creating employment opportunities for the landless and the poor and for creating infrastructure. Payrtient is made in terms of wheat; received through food aid.

Despite the progress made in the number of schemes and man-days, employment generated by the programme accounted for 1 per cent of the total available man-days. Secondly, the wage rate of workers under the programme has been found to be substantially lower than the officially stipulated rate in terms of quantity of wheat.

Finally, the quality of the infrastructure developed under the programme has been found to be poor. India has had more extensive schemes for wage employment. Though it launched the Rural Manpower Programme in 1960, it was only in the mid- 1970s that such programmes acquired greater thrust. In 1977, the Food for Work Programme was introduced. It was replaced by National Rural Employment Programme (NREP) in 1980. The NREP aimed at providing supplementary employment opportunities to those seeking work during lean periods, thereby creating durable community assets.

The programme aimed at creating 300-400 million man-days of employment per annum. The Rural Landless Employment Guarantee Programme (RLEGP) was launched in 1983 with the aim of providing guaranteed employment to at least one person of every landless rural labour household up to hundred days a year, to generate employment of 300 man days a year, in addition to employment generated under NREP.

In 1989, the NREP and the RLEGP were merged into a single expanded new programme called the Jawahar Rozgar Yojna (JRY). This scheme was estimated to create approximately 650 million man-days of unskilled employment per annum. It was expected to provide jobs for approximately 10 per cent of unemployed labour force in rural India.

These schemes have had some positive impact in the stabilisation of wages in rural areas and in providing landless labourers a certain degree of security, particularly during lean and drought periods. They, however, tend to give too much emphasis on building roads and buildings to satisfy local pressures, which in turn has led to wide and thin coverage in terms of community assets as well as neglect of more beneficial projects such as watershed-based land development works, soil conservation and irrigation. Public Provision of Basic Needs

It is well recognised that by targeting public expenditure in relation to basic needs fulfillment of the needy, much could be achieved in terms of enhancing the human resource potential of an individual.

The experience of Sri Lanka and the state of Kerala in India has already attracted widespread attention in this regard. Here, it is not the high levels of per capita income or land reforms and employment generating programmes, but the public provision of basic amenities such as food, health care and education that has played a crucial role in improving the quality of life of people in these areas. Both Sri Lanka and the Kerala state are distinctly far ahead of the rest of South Asia by all indicators of quality of life.