Rural Poverty Reduction in South Asia

A workshop on “Rural Poverty Reduction” was held jointly from 29 October to 3 November 2001 by the Asian Development Bank Institute (ADB Institute), the International Fund for Agricultural Development (IFAD), the Aga Khan Foundation and the Institute for Development Studies, Jaipur (IDSJ), India. The workshop took place at the premises of IDSJ and was attended by 43 participants from seven South Asian countries, namely Bangladesh, Bhutan, India, Maldives, Nepal, Sri Lanka and Pakistan. The main purpose of the workshop was to strengthen the institutional capacities of key policy making organizations that would allow them to introduce pro-poor policies at the national, regional and local levels. Also, the workshop was aimed at creating a network amongst the participants and speakers who will support rural development and who act as agents of change in their respective organizations. It was highly participatory and interactive, allowing participants and resource speakers to learn from other participating countries’ experiences in fighting rural poverty. Recognizing that rural development and poverty reduction require broad-based approaches, it was evident from the outset when the workshop was conceptualized that not all relevant aspects that impact on rural poverty reduction can be covered in a six-day workshop. Accordingly, it was decided in cooperation with the resource speakers and participants to focus the workshop on the following four priority aspects relevant to poverty reduction: (i) the emerging understanding of rural poverty, (ii) managing the rural transformation process, (iii) technologies for rural poverty reduction and (iv) empowerment of the rural poor.

Prof. Pradeep Bhargava, Acting Director and Senior Fellow, Institute of Development Studies, Jaipur, India welcomed the participants on the behalf of IDSJ. He described the workshop as an important occasion for the IDJS to strengthen bonds with the ADB, ADB Institute and IFAD.

Bhargava introduced briefly the state of Rajasthan and academic activities at the IDJS to the participants. He explained that the research agenda of the IDSJ is based on economic and social needs of the people of Rajasthan and the five broad areas of research at the Institute are Natural Resource Management, Economic Policy, Social Policy, Gender and Empowerment, NGO and Panchayati Raj Center. He said that the Mission Statement of IDSJ is “Bridging the Gap between Micro Realities and Macro Policies.”

Mr. Frank Polman, Country Director of the ADB’s Resident Mission in India highlighted in his opening remarks that poverty reduction is ADB’s overarching objective. He mentioned that rural Asia is home to a large part of the world’s poor who still live in poverty. From ADB’s viewpoint, it is a realistic and achievable goal that the region become free of poverty.

In the past few years, the ADB increased its focus on poverty reduction. ADB is presently undertaking detailed poverty analysis in 34 developing countries. Social infrastructure and rural development projects that directly address poverty accounted for around 24 percent of ADB lending in the year 2000. These included 10 projects in irrigation and crop development, three on targeting the poor and rural development and three on rural financial services. A project in Bangladesh, for example, helped 60,000 poor farmers to raise their income through cultivation of higher value cash crops. In other health related projects poor, ethnic minorities in rural areas where infant and maternal mortality rates are highest in Asia, were given access to essential health care services. Physical infrastructure projects such as power or roads that improve connectivity and improve the lives of the poor are other major areas of focus of ADB’s poverty reduction efforts.

Polman emphasized that project finance alone will not be sufficient to abolish poverty. In addition, it will be necessary to review the impact of decentralization and good governance on rural development, as well as the role of institutions in accelerating private investment and introducing new technologies. He said that the workshop would discuss several serious and important issues to provide a platform for policymakers, experts, practitioners and NGOs to interact and share their experiences.

Mr. Atiqur Rahman, Lead Strategist and Policy Coordinator, IFAD, introduced IFAD as a specialized agency of the United Nations, established in 1978 to fight poverty and provide nutritional support. The main objective of IFAD is to eradicate poverty in rural areas. It recognizes that threefourths of the poor live in rural areas and hence IFAD focuses on the rural poor. Unlike other UN agencies, it is a funding agency that provides loans and grants to its 161 member countries around the globe. With over 600 projects in over 103 countries financed by IFAD so far, it has lent more than $6 billion and helped to mobilize another $17 billion from other agencies and the member countries themselves. Currently there are more than 200 on-going projects.

Rahman described the workshop as a capacity-building activity. It is an expression of the willingness of like-minded institutions and partners to fight poverty together. International agencies have long neglected the capacity-building aspect of poverty eradication. He said it is time that for one to recognize that the poor may lack income and opportunities, but they have the knowledge and the aspirations to improve their living conditions. So the central question is on ‘How can one help the rural poor develop their own capacity so that they can influence decision-making processes and contribute towards improving their livelihoods?’

Like Polman, Rahman also pointed out that the capacity of governments needs to be developed in such a way that it could take over the leading and guiding role in poverty reduction. The bilateral and multilateral donor community can support the governments by providing resources and building capacity at the grassroots and other levels. Civil society organizations have been playing and can play active roles in this process. The key relation to all this is partnerships. The development community has to build coalitions to combat poverty. No single institution alone is able to achieve the millennium development targets.

Mr. S.B. Chua, Director, Capacity Building, ADB Institute welcomed the participants on behalf of Dr. Masaru Yoshitomi, Dean, ADB Institute saying that this was the first time that the ADB Institute organized a capacity-building program on rural poverty. The program was designed to focus on common issues that confront the seven South Asian countries in their fight against rural poverty. On the need for poverty reduction, Chua said that the Asia and the Pacific area is the largest developing region in the world and is home to the largest number of world’s poor. Poverty in the region has many different faces: The poor are wage laborers, landless workers, rain-fed and small farmers. Women are often disproportionately affected by poverty, therefore efforts to reduce poverty have to focus on such disadvantaged groups of people.

He believed that there are pathways other than migration to urban areas to reduce rural poverty. The rural economy is multi-sectoral and includes not only agriculture but many other dimensions as well such as livestock, fisheries, agro-industry, natural resources, etc. Therefore investments in the rural economy need to be promoted. Such investments are:

• ethically justified, as a bulk of the poor in South Asia is living in the rural areas
• politically right as rural development reduces the risks of national and regional conflicts
• economically sound, as they can result in high economic returns and have frequently strong multiplier effects
• environmentally correct as they reduce the degradation of natural resources

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