Enabling rural folk to overcome poverty

by Lennart Bage

Targeting rural poverty, particularly among Scheduled Tribes and Scheduled Castes, and women, will better enable India to reach its full development potential in a sustainable manner.

This year, as the first five-year review of progress towards the Millennium Development Goals approaches, India can be proud of its accomplishments. In January, the Millennium Project report announced that India was on a better track than several other developing countries to reach the Millennium Development Goals (MDGs) by the target date of 2015. The Beijing +10 meeting, held to assess the progress of commitments to improve the lives of women, shows that India is making strides in addressing gender equality issues. This is also the Year of Microcredit, and India, through its numerous self-help groups and innovations in financial services to poor people, serves as an inspiration to other developing nations.

Since 1979 the International Fund for Agricultural Development (IFAD) has been working with the Government of India to help reduce poverty in some of the country's most remote and fragile areas, targeting the poorest and most marginalised people. Mutual learning and information exchange has been an important feature of IFAD's work with India.

India's commitment to reducing poverty is reflected in the numerous initiatives it has taken, leading to the progress made over the last decades. But the country still faces a major challenge to reduce poverty on a larger scale.

Millions of poor people in rural areas will continue to suffer under the weight of extreme poverty unless progress is made in addressing the plight of vulnerable groups. Three-fourths of India's poor population, or 193 million people, live in rural areas. Scheduled Tribes and Scheduled Castes are among the poorest in India and constitute 40 per cent of the internally displaced population. These groups, and especially women, suffer a higher incidence of poverty, greater vulnerability and lower social status than others.

Targeting rural poverty, particularly among Scheduled Tribes and Scheduled Castes, and women, will better enable India to reach its full development potential in a sustainable manner.

IFAD has provided India with more funding than it has to any other country. IFAD is dedicated to working closely with the Government of India to improve the lives of women and other vulnerable groups.

IFAD also uses its expertise to reap benefits for the rural poor that go far beyond its initial investment. It does this by testing and implementing institutional and technical innovations that can be carried forward by others.

One example is the Jharkhand-Chhattisgarh Tribal Development Programme, to ensure household food security, livelihood opportunities and an improved overall quality of life. The programme was designed so that it could be easily replicated by government and other agencies.

Another example of an innovative approach is the promotion of self-help groups (SHG). IFAD through its support to the Tamil Nadu Women's Development Project piloted the SHG methodology, which is now recognised as an appropriate methodology for microfinance in the country. In addition, the Maharashtra Rural

Credit Project piloted the SHG-bank linkage methodology that has since been upscaled at the national level by the Government, NABARD and other institutions.

IFAD places empowerment at the heart of its projects and programmes in India. A main goal of our work is to empower people with the skills and assets they need to lift themselves out of poverty.

IFAD supports investment projects and programmes in the populous states of central India where levels of rural poverty are some of the highest in the country. Programmes in Orissa, Jharkhand and Chhattisgarh are benefiting 608,000 tribal poor people by helping them improve their livelihood opportunities. IFAD is supporting the Small Industry Development Bank of India through the National Microfinance Support Programme. This programme will reach 1.3 million poor people in underserved areas, helping them to develop an extensive, national microfinance sector which will provide technical assistance so rural poor people can start, expand or diversify income-generating activities.

IFAD has also responded quickly to the tsunami disaster by approving a $30 million loan package to support recovery of livelihoods of affected communities in Tamil Nadu. Promoting grassroots institutions is the cornerstone of IFAD's strategy in India.

(Lennart B{macr}ge is president of the International Fund for Agricultural Development (IFAD), a specialised agency of the United Nations, and is currently on an official visit to India)

(The Hindu)