Rural Poverty in India

About two thirds of India’s more than 1 billion people live in rural areas, and almost 170 million of them are poor. Although many rural people are migrating to cities, three out of four of India’s poor people live in the vast rural parts of the country. For more than 21 per cent of them, poverty is a chronic condition.

Where are India’s rural poor people and who are they?

Poverty is deepest among scheduled castes and tribes in the country’s rural areas. India’s poorest people include 50 per cent of members of scheduled tribes and 40 per cent of people in scheduled castes.

On the map of poverty in India, the poorest areas lie in parts of Rajasthan, Madhya Pradesh, Uttar Pradesh, Bihar, Jharkhand, Chhattisgarh, Orissa and West Bengal.

Large numbers of India’s poorest people live in the country’s semi-arid tropical region. In these areas shortages of water and recurrent droughts impede the transformation of agriculture that the Green Revolution has achieved elsewhere. There is also a high incidence of poverty in flood-prone areas such as those extending from eastern Uttar Pradesh to the Assam plains, and especially in northern Bihar.
Poverty affects tribal people in forest areas, where loss of entitlement to resources has made them even poorer. In coastal fishing communities people’s living conditions are deteriorating because of environmental degradation, stock depletion and vulnerability to natural disasters.

Why are rural people poor?

A major cause of poverty among rural people in India is lack of access for both individuals and communities to productive assets and financial resources. High levels of illiteracy, inadequate health care and extremely limited access to social services are common among poor rural people. Microenterprise development, which could generate income and enable them to improve their living conditions, has only recently become a focus of the government. 

Women in general are the most disadvantaged people in Indian society, though their status varies significantly according to their social and ethnic backgrounds. Women are particularly vulnerable to the spread of HIV/AIDS from urban to rural areas. In 2005 an estimated 5.7 million men, women and children in India were living with HIV/AIDS. Most of them are in the 15-49 age group and almost 40 per cent of them are women.

Source: IFAD

Who says development sector is all about selfless service!!

I am reproducing this article verbatim for those who are not avid readers of TOI and also for those of my friends who are not directly related to the development sector.

Source:TIMES NEWS NETWORK

Great ideas often spawn in the most terrible circumstances. One such idea is microfinance, often credited to last year’s Nobel prize winner Mohammad Yunus, who founded the immensely successful Grameen Bank of Bangladesh.

Yunus began by giving a micro-loan of $27 to 42 impoverished families after witnessing the horrors of the great Bengal famine. But the idea, which was inspired by misery and depends on the poor, ironically, is attracting savvy, super-rich investors.

“Microfinance is now sexy,” says Vikram Akula of SKS Microfinance, which has just received $11.5 million from private equity funds Sequoia Capital, Unitus Equity Fund, Odyssey Capital, SIDBI and venture capitalists Vinod Khosla and Ravi Reddy.

Khosla had earlier invested in Varanasi-based Cashpore. That profit-seeking capital is flowing towards microfinance institutions (MFIs) suggests that the sector is gradually growing out of its fledgling age.

“Capitalisation was the first bottleneck in the development of microfinance. Now it is not,”says Brahmanand Hegde, joint general manager, rural and micro banking group of ICICI Bank, which has lent Rs 4,500 crore to MFIs over the past three years.

Still, Hegde estimates that the sector needs about $5-6 billion of pure equity capital.

There is good reason why private pools of money, which are always on the lookout for ways to maximise returns, are showing interest in Indian MFIs. Many of them have built up a strong client base.

The big few have captive clientele of at least half a million. There are 49 MFIs that have a client base of over one lakh.

MFIs like SKS and Spandana, who follow the Grameen model to the T, are helping rural households to rise from grinding poverty by encouraging entrepreneurship. There repayment rates are near 100%, better than any bank in India. And they are slowly breaking even.

“We see microfinance firms generating huge cash flows from different channels. MFIs can create potential customers as they upgrade them into micro and small-scale entrepreneurs. That will generate demand for various financial and commercial products,” says Mohit Bhatnagar of Sequoia Capital.

Akula says that some of the small businesses generate huge returns on capital invested. For example, micro diners SKS lent to made returns of as much as 246% and pottery as much as 236%.

Even vegetable vending generated returns of 57%. As the clients’ financial condition improves, they become potential customers for other products such as insurance or a cell phone.

At that stage, MFIs can tie up with insurers or telephone companies to sell products to their loyal base, which in turn will earn the company commissions boosting profits.

“In the Grameen methodolgy, once you break even, you grow fast and become very profitable,”says Vijay Mahajan, who founded Basix, the country’s first MFI born with a corporate structure. Basix was also the first to attract foreign investment when IFC, Washington, the private funding arm of the World Bank, Triodos Bank of Holland and Shore Bank of the US together invested $1.5 million in 2000.

“The investors in this sectors are typically patient investors — willing to wait for seven or 10 years. But they know that ultimately there will be profit,”says Mahajan.

Listening to Fuzon

After almost four years I got to hear my favourite song, Khamaaz from Fuzon, a pakistani band. The velvety melody of this song made me remember my graduation days. Coupled with a deja vu comment by Ranjan on this blog compelled me to spare a moment for the times when we all were together in Delhi. Wasim, Ranjan, Kundan, Akhtar, Anil and others. Living with the qualities and eccentricities of each other was pure fun. Afterall a lifelong bond gets established especially when you frequent Ridge thana dhaba at 2.30 am to grab something to eat……or share your evening tea at Ramjas- Daulat Ram traffic light and exercising your fundamental right to eat anything and ‘look’ anyone.

Wasim is in Bangalore. He has become a globe trotter and remains on holidays most of the time. When he is free from all these he claims to put all his effort for his Phd. Did I hear astrophysics?? Wow. Ranjan is doing things which are beyond his qualifications. At least thats what he claims from New Jersey. Akhtar, as always, is perpetual introvert and seems to be engaged in some research work at IITKanpur. Kundu has become a professional and is truly ‘committed’ to his cause at Noida. Anil Da is hell bent to give me company in the development sector.

Getting rid of my prolonged adolescence

Delving in dark with approach melancholy

I perceive a thought, soulful though moribund.

Cocooned as it is deep inside, frothing duly

My thought binds my conscious but lies unexpressioned

    – a quintessance of gauche adroitness I boast of.

Once the venom recedes and innocence gets rooted

My sordid intellect will give way to an experience scintillating.

An experience when my thought gets a face.

Truncate the monster

A subtle thought evokes a stir, forcing me to rethink.

Where will it all lead to?

To the same mundane I, me, myself path seeming uncanny

Or to the unambigous daunting path forbidden by many.

These are the usual crossings where I always get caught

My heart is with me but my mind is not.

O God,

Make your presence felt, prepare an elixir

Disrobe me of my venoms

Give me the divinity I need.

The day my thoughts get rigid, we will be in cohort

Then I will flow just like love, all encompassing, omnipresent.

My Life

Goals have been achieved, but I am feeling restless

Aims have blinded me, they have left me faceless.

Here I come to my senses feeling enlightened

Will I serve the humanity, my heart is silent.

Engulfed I have been in this material world

By desires not straight, they are entwined and curled.

This day I have a mind more vicious than my heart

There it goes again to get tamed by the worldly hart.

What?……..Bloggin…..me…..r u kiddin?

As the title suggests I had hardly been enamoured with the idea of becoming a regular blogger, in fact .not even a fractional blogger. As has been the case throughout my life I change my preconceptions when I find someone close and intelligent preoccupied with the anithesis of my preconceptions. This time I saw a handfull of my friends indulging into serious blogging and then inviting me in the most boastful manner to check their hard to decipher blogs.

Trust me. I find blogging the best platform for worst moronic activities cacooned inside artificial seriousness.

I remember my graduation days at Ramjas College where I had to run behind my friends to compell them listen to my unrestrained creative outbursts – my poems. Not any more. After all I have become a BLOGGER….