'What is good for the poor is good for everybody'

Terrorism of many known and unknown varieties including corruption is also a major social problem in Bangladesh. Needless to mention that young men from the poorer sections of the society are attracted more to calls for joining such groups as they lack education and also employment. The poor also live on the fringes of nature and they also cause many environmental degradation including water pollution, forest depletion and communicable diseases etc. Recently the business community is crying loud against terrorism and extortion as they seemed to have exceeded any previous level. However as we know the business community is not going to bear all the costs of disruptions. They have been passing them on to the buyers most of whom are poor. This is perhaps the main cause behind recent spate of rising prices in the country. As prices of essential continue to rise unabated most of the people, specially fixed income earners and rural consumers with stagnant prices for agri-products and rural services suffer badly. In our case this is likely to create major social unrest and the opposition parties are perhaps taking advantage of the situation to unseat an elected government. Hence poverty reduction must be a worthwhile strategy for any government that wants to govern the country as majority of the population is poor.

Literature on strategic management, of which planning is one element, emphasises identifying strengths and weaknesses, and opportunities and threats. So far amidst all the trials and tribulations we achieved certain degree of success in four sectors directly related with poverty reduction. These are the RMG industry, NGOs/MFIs, sending workers abroad and increase in food production. RMG industry employs about two million workers, 80 per cent of whom are women from rural areas. Roughly about 10 million people live on the earnings of RMG industry. NGOs with and without micro credit reportedly reached 55 per cent of the total population, that is about 60-65 million people. Food grain production has trebled since 1972, when population roughly doubled. And over three million people are working abroad and remittances from them reached $3.0 billion a year. These are very significant achievements by any standard, regional and global. Performance in all these sectors should be further geared up to bring poverty further down. What needs to be done for these sectors have been widely discussed at national and international levels. For example RMG is likely to face more competition after 2005 when MFA is withdrawn. Cost reduction must be a strategy for RMG. How can that be attained is already identified. Lower cost of capital if needed by giving subsidy, improving design and increasing workers' skill, among other things.

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Recently held MFI world summit in Dhaka identified certain actions such as scaling up of MF, introduction of insurance and some regulatory framework etc. Government should not compete with MFIs as it does not have the capability. It may simply distort the system that is working well. Instead the proposed NGO Foundation is a good move and it should be supported by donors.

No doubt food production can be increased under the existing small holding that we have in the country. Problem lies in input output prices for the agriculture sector. Growers have no control over any of them. Paddy, potato and vegetable prices go down sharply at harvesting time as small growers cannot hold them. Farmers mostly sell their output forward to money lenders and middlemen as they cannot finance purchase of inputs, seed, fertilizer and water from their savings which never accrue to them given the system. Can GOB and NGOs do something to provide credits to the growers during the growing season against their land or crop on the field? MFIs so far targeted mostly landless poor and non-farm activities. The scaling up of MFIs that was suggested in the Summit at Dhaka should cover crop production and storage. That will have tremendous impact on incomes of farmers and they will in turn invest and consume more of other goods and services.

What has been said above is that we should utilise our revealed strengths in RMGs, NGO-MFIs and give incentives to the farmers to produce more. On the other hand, we must try to reduce our weaknesses in delivery of certain public services such as education and health, law and order. It is true the poor are dependent on public education and health services. But what is the quality of those services? Enrolling more girls to schools and colleges is good provided they obtain certain skills in language and quantitative analysis at the least. Currently very little is learnt and the system loss in failures in public examinations is huge. Investment in improving the quality of education must be an essential element in poverty reduction strategy. Health services in the public sector also need to be strengthened by more investment in community based models.

Another aspect in which weakness exists is vulnerability to uncertainty and risk for the poor. That is they do not have social protection against unforeseen events such as floods, droughts, river erosion, crop failures and above all loss of employment opportunity. An example may be given from thousands of cows recently distributed in the char areas in Kurigram district by the Prime Minister. Livestock like those have to be serviced by veterinary doctors so that they do not die from some diseases that are very common in Bangladesh. Providing insurance coverage for these cattle head against death is a good measure of social protection for the poor. The premium needed to cover these cows may be collected partly from the recipients and partly from some donor agencies. Crop insurance for marginal holding farmers can be introduced by some NGOs on a cooperative basis.

The coverage of old age allowance should be expanded in all districts. Above all unemployed youths should be given some vocational training that is in demand at home and abroad. We must recognise that it will be impossible to employ all these youths within the country at any foreseeable future. It is also known that there exists manpower shortage in many countries and it is likely to increase in the future. A targeted approach to combine training in skills and languages and job search and placement by the concerned ministries should form an element in poverty reduction strategy.

At macro economic level employment generation must be the focus and for that matter so called development projects must be reoriented towards that. The Finance Minister and others are on record stating about very high wastages and siphoning of funds from construction projects by some quarters. Half of the amount budgeted for construction of a bridge and paved motor ways goes in the air he said. If we look at the ADP of this year highest allocation is for construction by all departments of the government. Can we think of reducing the size of allocation for construction of new roads and bridges and buildings for the next five years? I can see two such bridges on the same river in my own area lying unused for years. Rather funds should be provided for maintenance of existing roads and smaller river crossings should be done by ferry boats where heavy vehicles do not move. As strategy revenue collection imperative to finance such wasteful construction projects is counter productive as it is also not pro-poor.

In conclusion it may be said that if you take care of the poor every one is benefited including the government, the business community and the rest of the society. It will reduce growth of terrorism at the source. For that build our revealed strengths in RMGs, NGO-MFIs, agriculture and manpower export. At the same time reduce our weaknesses in the delivery of many pubic services such as education and health care and social protection against vulnerability of the poor.

M Shamsul Haque is the Vice Chancellor, City University, Banani, Dhaka.