Asset development key to development policies: World Bank report

A recent World Bank report calls for retrospection on a slew of developmental policies that have been implemented or are being deliberated in the country. It emphasises on asset creation and a “free and fair” economic playground at the grass-root as the key factors, without which the developmental policies lose its real significance. The research is based on the premise that mere aggregate statistics on poverty leads to sub-optimal policy framing; while some manages to climb out of poverty, others fall into it.

The report, 'Moving Out of Poverty: The Promise of Empowerment and Development' was conducted in four states of Andhra Pradesh, Assam, West Bengal and Uttar Pradesh. It reveals that West Bengal has the highest per cent of people who moved out of poverty. At the same time it also has the maximum number of people who slipped into poverty. In West Bengal 18.8 per cent moved out of poverty, whereas it was 12.8 per cent, 10.6 per cent and 7 per cent in Uttar Pradesh, Andhra Pradesh and Assam respectively. The “fallers” per cent for West Bengal is 7.7, Assam and Uttar Pradesh 5.5 and Andhra Pradesh 3.2. The statistics represent a lack of comprehensive policy framing and implementation. The viscous cycle of poverty gets played out, with some communities recovering from poverty while other slipping into it.

Through the report people cites strengthening of the local governance as an important factor in overcoming poverty. The study finds that in Andhra Pradesh SHGs have remarkably empowered people to overcome caste and gender biases. Regular elections and availability of information is the key to achieve this. The partly successful NREGA has at its worst exposed the criminal nature of Indian bureaucracy and the deplorable state of local governance in the country and at its best proved that people are ready to struggle for their rights, once the basic mechanisms are in place. “NREGA will need to support creation of new economic opportunities in local communities, that contribute directly to asset creation for poor people,”says Deepa Narayan, director of the study. Twelve per cent of the people said multiple income generation in a family is a way to tide over poverty. Kudumbashree, a women's neighbourhood programme in Kerala was a successful in creating multiple incomes to the families.(ELABORATE)

Health,death and social shocks were sighted in the study as a major factor precipitating the fall into poverty. In Assam 51 per cent of the people surveyed said, death and health shocks pushed them into poverty, whereas in Andhra Pradesh it was 32 per cent. The study suggests that health insurance programmes and better access to savings and credits as the cure. Recently, TDP in Andhra Pradesh had made an election promise to directly transfer money to the poor to tackle poverty if it is voted to power. Once in place, through Conditional Cash Transfer(CCT) the government can transfer money to the poor families for a “social contract”--i.e sending children to school or using primary health centres. The money will be transferred electronically and the female member of the family can receive it. Recently Centre for Sustainable Agriculture, endorsed by farmers union and some 100 NGOs has demanded for the same, to all cultivators. This would help in developing of assets such as house and land which the study cites as an important factor in preventing people from descending into poverty.


There is also an increasing need to rescue people especially farmers, who live dangerously close to the margin of poverty. The new policies must not just treat farmers as “primary producers,” but as “a part of the value addition activity.”The report backs M.S Swaminathan's recommendation for Farm Income Commission to the 2009-10 Union Budget.(ELABORATE) The commission could ensure a minimum income for agricultural operations. The study says that the farmers who permanently moved out of poverty were those who invested in building some assets like a house, a tractor or even a bullockcart or a irrigation pump.

The report interviewed 30,000 men and women from across 300 villages. It is a part of 15 country research effort in East Asia, South Asia, Africa and Latin America. It was conducted over a period of ten years from 1995 to 2005.