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TOP HEADLINES 13 May 2011
1. INDIA: Clashes over highways spotlights land struggles
2. PHILIPPINES: Rural banks use technology to reach out to poor
3. PRC: Middle-class appetites drive food inflation
P O V E R T Y   S P O T L I G H T
INDIA: A trade not worth its salt
4. INDONESIA: Five-year plan to spend $250 billion on infrastructure
5. VIET NAM: Farmers not profiting from increased produce prices
6. PRC: Measures to address income gap
7. PHILIPPINES: Plan to lease farm land to city squatters
8. SRI LANKA: Poised to increase stake in outsourcing industry
9. CAMBODIA: Banks welcome larger role of MFIs
10. SOUTH ASIA: Share information to boost food security
IN DEPTH
1. INDIA: Clashes over highways spotlights land struggles
Source: Bloomberg

"Conflict between farmers and companies trying to secure land for projects has hampered India's plans to expand highways, crucial to luring investment as they account for 2 percent of the nation's road network and carry 40 percent of the traffic. Tussles over land have sparked rioting and stalled more than $100 billion of projects across India, according to the Associated Chambers of Commerce & Industry.

In the fiscal year ended March 31, 2010, only 3,360 kilometers of road projects were awarded in India against a target of 9,800 kilometers because of tardy progress in procuring land, according to the nation's Planning Commission. The delays have prevented India from reducing business costs and making it easier for companies to operate in Asia's third-biggest economy. India's poor logistics infrastructure is estimated to cost the economy an extra $45 billion, or 4.3 percent of gross domestic product, each year."



2. PHILIPPINES: Rural banks use technology to reach out to poor
Source: Manila Times

"Rural banks in the Philippines have been using leaps in technology to bridge the divide between providing banking services to the poor and keeping overhead costs low to allow a measure of financial returns for banks. By forging tie-ups with Globe Telecom's G-Xchange Inc. in 2005 and more recently, with Smart Communications using their Smart Money platform, rural banks introduced the use of cell phones and mobile money to reach the poor and provide financial services at a lower cost.

Among banks' biggest costs is the expense of collecting loan payments. Higher costs of door-to-door collection practices require banks to charge higher interest rates. With the use of mobile money payments, this is now changing. The use of cell phones and mobile money platforms allows savings for both the clients and the banks."



3. PRC: Middle-class appetites drive food inflation
Source: AP

"Prosperity and a fast-growing middle class have cultivated more sophisticated and exotic tastes in PRC. Such luxuries as blueberries, avocado, asparagus, and endive, recently unattainable to all but the wealthiest, are now widely available in China's big cities. But rising affluence has reduced the ability of farmers to meet growing demand while the rural labor pool dwindles.

The result: rising food prices hit every level of society, not just those who can afford imported South American bananas or pricey mushrooms and herbs from China's remote Yunnan province. In China, farm workers have flocked by the millions to factory and service jobs in coastal cities. Luring them back to till and weed by hand is proving a tough sell. The resulting supply pinch helped send food prices up 11.5 percent in April from the year before, adding to months of steep increases."


P O V E R T Y   S P O T L I G H T
INDIA: A trade not worth its salt
Source: One World

"Most saltpans in Kothapatnam village in the coastal Prakasam district of Andhra Pradesh are family-run. But the price that the salt fetches in bulk sales is extremely low -- anything between Rs 25 and Rs 35 ($1=Rs 39.90) for 75 kg. This means that the task of the women traveling door-to-door selling the salt is tedious. Their sales expertise is crucial to the family finances: retail sales fetch one rupee per kg of salt -- pathetically low, but nevertheless desperately needed.

The Prakasam District Salt Farmers' Forum has been largely responsible for organizing the salt-makers and helping them with their bulk marketing of the salt. Furthermore, the women have to pay dearly with their health. Says Battala Seetharamamma, 50, 'What we earn from all our hard work is not even enough to treat all the ailments that come with it, let alone cover other expenses. We live and die in sickness.'"


4. INDONESIA: Five-year plan to spend $250 billion on infrastructure
Source: Bloomberg

"Indonesia will probably spend $250 billion on infrastructure development in the next five years, investments that will spur the economy and ease bottlenecks that have crimped growth, according to Morgan Stanley. Public and private investment in infrastructure may be equivalent to 5.9 percent of gross domestic product in 2015, from 3.9 percent in 2009, Morgan Stanley economist Deyi Tan wrote in a May 10 report. That will boost growth to 7.2 percent by 2015, she said.

Indonesia is one step away from its first investment grade rating in more than a decade as President Yudhoyono targets growth of as much as 6.6 percent through the remainder of his term ending in 2014. He plans to double spending on roads, ports and airports to $140 billion by then after inadequate infrastructure hampered growth. Indonesia aims to build 20,000 kilometers of roads and add 15,000 megawatts of power generation by 2014."



5. VIET NAM: Farmers not profiting from increased produce prices
Source: Vietnam Net

"The prices of farm produce such as rice, coffee and pepper have been escalating in Viet Nam, but farmers are not benefitting from the price increases. Once the prices of farm produce like rice or coffee increase, the prices of food and other input materials for the cultivation of the new crops also rise. That explains why profits from rice cultivation do not increase in accordance with farm produce price increases.

Coffee prices have been increasing, but this has not brought big profits to both enterprises and coffee growers. Companies lack capital to buy coffee from farmers at harvest time, while farmers have to sell coffee immediately to small merchants because they need money to pay matured debts. Farmers often have to borrow money to cultivate coffee, and they sometimes have to purchase fertilizer and fuel on credit."



6. PRC: Measures to address income gap
Source: China Briefing

"In a rural village in Shandong Province, a middle-aged woman earns a daily wage of 40RMB ($6) from her potato field. It may not seem like much, but still it is twice as much as what she was earning three years ago. The same country is also experiencing one of the fastest sustained economic growth rates in the world. As a result, China now boasts more than 130 billionaires and the country is expected to become home to the fourth-largest number of wealthy individuals by 2015.

Currently, China is seeing the widest gap between the rich and the poor since the beginning of economic reforms in 1978. There are a number of sections in the 12th Five Year Plan that reflect the central government's efforts to attack poverty and unbalanced economic distribution. The government also has plans on tax reform, which will raise the income deduction threshold to reduce the tax burden on the country's low income population and regulate its high income population."



 DEVBlogs ROUNDUP
Nearly 5,000 students from 25 schools in Mangalore, India, will be trained to analyze and monitor water quality with water laboratories. Of the 25 schools, eight schools will be equipped with water laboratories to facilitate water quality monitoring and two schools will have water classrooms demonstrating water conservation methods. Specially trained teachers will guide school students throughout the project.


7. PHILIPPINES: Plan to lease farm land to city squatters
Source: Inquirer

"President Aquino has revealed a government plan meant to solve Metro Manila's problem of informal settlers while shoring up the population in the country's agricultural communities to boost the drive for food self-sufficiency. There are more than 560,000 squatter families in Metro Manila and it is estimated that one of four residents in Metro Manila is an informal settler. Meantime in the countryside, the number of farmers is going down to the detriment of the government's food security efforts.

Mr. Aquino said providing farm land to squatters could be covered by a lease agreement. He said his government had identified 1.5 million hectares for distribution to the squatters who would avail themselves of the program to relocate possibly to their respective home provinces. The priority beneficiaries, he said, are the informal settlers that live dangerously, such as those in floodways."



8. SRI LANKA: Poised to increase stake in outsourcing industry
Source: Daily News

"Sri Lanka is well poised to increase its stake to 1 percent of the astronomical $450 billion global Business Process Outsourcing (BPO) market within the next three years, a frontline industry resource person said. He said some of the far reaching measures that the country had to adopt was to have IT theme parks and buildings and infrastructure on a large scale like in India.

He believes that the way forward for Sri Lanka's BPO sector was to tap the medium and small companies in the West now that the mega ones have gone to India and the Philippines. He sees the industry developing fast in the peripheries of Sri Lanka. Some of the ideal cities that the industry could be taken would be Kandy Hambantota and Anuradhapura and this could be ideal locations for promoting employment."



9. CAMBODIA: Banks welcome larger role of MFIs
Source: Phnom Penh Post

"Commercial banks are welcoming the larger role for Microfinance Institutions (MFIs) in Cambodia, following an announcement that the National Bank of Cambodia (NBC) had granted a deposit license to VisionFund Cambodia. VisionFund is at least the seventh MFI to receive a deposit license, and has announced interest rates on certain deposits as high as 10 percent -- higher than what many commercial banks offer in Cambodia.

But commercial banking officials say MFIs target different markets, and offer a way to extend banking to the the country's large unbanked population. If more MFIs can receive deposit taking licenses from the NBC, it means they can increase the flow of money into the financial system."



10. SOUTH ASIA: Share information to boost food security
Source: Daily Star

"South Asian nations are faced with problems of rising population and declining farm land in the region. Information sharing on the successes and challenges of agriculture and food security among SAARC countries can help reduce risks associated with the population boom and receding arable lands in the region.

The flow of information on methods of cultivation and crop safety procedures as well as sharing market information on prices, products and inputs among farmers, consumers and businesses can be components of a very useful SAARC strategy on agriculture and food security."



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