Hyderabad Tour

After Rahul’s epic travelogue, I was really hesitant (read scared) to put down my “Experience of Hyderabad Tour” that I had as part of Training at Basix Academy on “Microfinance: Practices, Processes and Risk Management” last week. Anyway, as a senior blogger (hope Rahul will not mind for this self proclaimed designation); I thought I should write something as so many things had happened first time in this tour.

It was three and half day tour (24^th to 28^th June) and we reached Hyderabad on 24^th Night. It was indeed my first travel by Air and frankly speaking I was frightened. The day before the actual journey, late night edition of 9XNews was exclusively carrying a half hour story on recent time aero-plane accidents and believe me every time I was changing my remote, it was getting standstill on that channel only. Hope you can imagine how good sleep I had that night.

The first flight experience in one word: Good. I was terrified when the plan was taking off, I was terrified when the plan was jerking in the mid air and I was terrified when the plane was landing. The smile of the beautiful air hostesses even was not enough to relieve me.So I can’t rate this journey more than “Good”. The come back flight was cool and I guess I am now quite confident for journey by fight.

Ok the real story started at the night when we had reached the Hotel which is almost 30 KMs away from the stunning Rajiv Gandhi International Airport (my senior Darshini from her personal experience shared that this airport is even better than Paris International Airport). First thing I had to do after reaching hotel was to give food to the Vodafone Dog so that it can bark (read: recharge my Vodafone mobile). So I went out from the hotel around 10.30 and I thought recharging of my mobile would be the easiest job in the universe. Coming from Mumbai, it was unimaginable for us to think that a city can be closed at mere 10.30 PM. So first, I went upto 1 KM by walking to right hand direction. It was absolute shocking to see that there was not a single shop open at that time. I thought then that the left side direction would be active as it’s the era of Left (be it IPL, Nuclear Deal or Oil Price reaching 148 dollar, Left are all there). So I went to the left direction and it was truly futile effort. I had to come back to hotel without recharging. The story does not end here. Before leaving the hotel I along with Ravi gave order for Dinner and when I was coming back empty hand, I was appeasing my mind that I will have good time as I had given order of Special Hydrabadi Biriyani. There was no food in the hotel’s room and it was almost 45 min over. Ravi checked to the reception and the famous answer came that the kitchen was closed at 10 and so there was no food (that son of b***h receptionist did not say this at the time when we gave our order). Nothing could have better than this. After disastrous food at the flight (I could not believe how food can be so tasteless at the flight when they are taking so much money), I was terrible hungry and Ravi too. So again I had to come out of hotel with hope (I guess it was greater that Lance Armstrong’s hope) that if any where any thing I get to eat. After 1.5 km walking me saw a bakery shop open and I bought cake and biscuit for my dinner. It was tastier than Biriyani at that time J

The first Day Training was general classroom training on Microfinance, its models and Legal Aspects. It was nothing new for me as I already had little bit exposure. But it was special for me because I could not believe that I was being taught by none other Mr. Shankar Dutta, the Livelihood and Microfinance Expert. It was dream coming true after the lunch when “Father of Indian Microfinance and Livelihood”, Vijay Mahajan Sir came to give us lecture on Bank and Microfinance linkage. He is really superb and I would like to give one example how passionate this man is for development of marginal people. He was telling a real life incident of his own house maid and one boy who collects garbage from his house. Sir wanted that these people should also be part of financial inclusion and they must have account in bank. We spend thousand words and write papers after papers for this financial inclusion. But when it was a simple act (accounts opening of these so called marginal people, so many obstacles, rules, regulations arise and ultimately the sufferer is these people). Without exception, it was not possible for that house maid and that boy to open account.

May be it was plain  incident, but the way Vijay Mahajan Sir was expressing his concerns for these people, it was clearly comprehensible that those words were directly coming from his heart. I was really wondering that a man like his stature (who has nothing to gain) is still so energetic; his eyes spark when he talks about these people. Salute Sir!!

The next day was supposed to be the field visit and it was in a place called Vidar which is district headquarter of District Vidar, Karnataka. The journey to Vidar from Hydrabad was excellent (Darshini please don’t mind, those Kishore Kumar’s songs were amazing). I was really missing those IIFM Field Trip days when similarly in a Zeep or similar kind of vehicle, we five people used to travel the country roads of Karnataka along with forest officials. The mood in the vehicle used to be much dramatic with Abhishek’s witty remarks, real mock fight between Vaibhav and Kalpana and Shweta’s act of reconciliation aunty. “Jane Kahan gaye woh din”!!

The journey was good till the time when actually we realized that we were being directed by a Hyperactive Human Being who had lost his way to the place where we supposed to spend that night. Shrey, Getting lost is not good all the time specially when you are lost not because of you but because of a third person whom you are not liking. I can’t count how many times our Quails driver took “U Turn” that night. Finally we discovered that place and I must say it was beautiful Guest House. Actually it was Guest House cum Training Center of DCCB, Vidar. The dinner served that night was amazing.

Next day was hectic and we had to cover and see the microfinance operation being run by NGOs (Pawardha), MFIs (Nirantara and NKRDS) and Bank (DCCB, Vidar) at the same time. It was incredible to see those women with much confidence and smile in the group meeting of SHGs as well groups formed by MFIs. That part of Karnataka has much higher penetration of Microfinance operation because of the influence of adjacent “Microfinance Mecca of India” Andhra Pradesh and it was first time for me to see the cross borrowing by borrowers (One Borrowers borrowing from different MFIs). I guess it has both advantage as well disadvantages and its upto the MFIs to decide that whether they are feeding to those whose stomach are already filled or still hungry. It was also first time for me to see the Community Based Microfinance Institutions (GMASS) where community members themselves have built MFI out of their need and few women who were once mere borrowers have made into the board of the MFI.  

The returning journey was nothing special except for Darshini who might not forget those songs that our Driver played at the end of our Journey. It was awesome CD produced by Great Gulshan Kumar of T-Series. The songs were supposed to be for the broken heart and broken souls but the dialogues, in between the songs, were so hilarious that even every broken soul will might burst out in laugh J

We retuned hotel around mid night after breathtaking dinner at a Dhaba whose name was “International Dhaba” J

The last day was normal classroom teaching and finally it was over by 4.30 PM. Our fight was at 9 and so we had time to see the “Charminar”. It was nothing exceptional and I did really not like that throng there. We returned to hotel at 6 PM and Checked out to catch Radio Cab for airport at 6.30.

The Return from the Hyderabad was cool. Over all it was good experience minus Hyderabadi Biriyani. Please Curse me for the reason that I did not  eat “Hyderabadi Biriyani” in Hyderabad L

Negative Area, Muslim, Ghoragacha and Mumbra

I was going through the mails of Members of Solution Exchange Forum and suddenly came across a mail by Dr. Arabinda Mitra. I remember that he was my teacher in Bidhan Chandra Krishi Viswavidyalaya (B.C.K.V) where I did my Graduation in Agriculture. Sir is from Department of Agril. Economics. I was curious to see that Sir has been associated with SHGs Movement in a remote village called “Ghoragacha” which was close to B.C.K.V. So I decided to write a mail to Sir and asked about the details. Sir was kind enough to reply me back the very next day and after going through his mail, I was surprised and excited too.

I am reproducing below Sir’s mail

“I shall write in brief here about the Self Help Groups of Ghoragacha. We started an informal school at Ghoragacha, a nearby village to Bidhan Chandra Krishi Vidyalaya, Mohanpur, Nadia, West Benagl to educate the farmers about practices of agriculture. The school was funded and supported by UPL Company. This was the first kind of school in India. Later this model has been replicated by state government, central government and others. This type of school was set up in many states. I was associated with the school from the very beginning. The philosophy of such school and mode of operation was mooted in the department of agricultural Economics. In fact I was heading the department that time. We included Farm management and cost aspects in the curriculum of the school.

One day I was listening to the lecture delivered by Dr.H.Sen (Agronomy). He was telling about OL (elephant foot.). I was astonished to see high return from OL. At the end of lecture I asked about 60 learners whether they are prepared to grow ol in the coming season. Only two hands were raised. Upon questioning I came to know that to harvest one bigha of ol- it requires at least Rs.20,000 /,which these people can not bear. Then I asked for financial support from banks or other sources. I found that this particular village is blacklisted. UBI (Jaguli) branch or the Co-operatives are not willing to give loan to them. It is very difficult to take loan from local money lenders. They charge more than 50% per annum. The farmers were really poor. Their source of income was only from land. The positive thing was that they are most efficient farmers in the region.

I asked them I am sorry that today are not in apposition to cultivate ol. But in the coming years you can grow more valuable crops, if you are united and stand by yourself with out depending upon external source. They agreed. I stared with the lessons of forming SHGs. Ultimately they did. More than 30 Shgs are in operation in this village. Women have formed SHGs. It was also my challenge as because this village is 100% dominated by Muslims.

Today I am proud that they are cultivating the most valuable crops ,viz, Guava. This has become the second Baruipur. People are happy. With development of SHGs there have been tremendous social and economic changes. Banks are now coming to lend money. Upon evaluation they told me that money lenders are not seen in the areas. Now, they put the question” Sir, what we will do with money. We have money and now need other things to be done by us”. Those SHGs are not dependent on any external organizations. They have built up themselves. They are running in their own ways. I was with them for constant two years. Then I left to see whether they can do themselves or not. The thing is that they can. Results of Shgs at Ghoragacha have been visited by many scholars”

Sir’s mail reminds me about the place “Mumbra”, a sub urban town in outer Mumbai. It is also considered as Negative Area and thats why No Bank gives loan to people of Mumbra. The interest rate was as high as 10% per month. Ironically both Ghoragacha and Mumbra are dominated by Muslim People. Then I searched internet and came to know many Muslim areas are considered as Negative Area and if one area has been tagged as Negative area, then nobody really takes the pain to look into whether it is right to continue the trend or not years after years. I could not figure out the reason.

Do Muslim are so risky for lending? Is there anything to do with their religion with lending money?

Microfinance and India

Poverty alleviation and Micro finance: Indian context 

“Money , says the proverb makes money. When you have got a little ,it is often easy to get more. The great difficulty is to get that little .”Adams Smith.

Today India is facing major problem in reducing poverty. About 25 million people in India are under below poverty line. With low per capita income ,heavy population pressure , prevalence of massive unemployment and underemployment , low rate of capital formation , misdistribution of wealth and assets , prevalence of low technology and poor economics organization and instability of output of agriculture production and related sectors have made India one of the poor countries of the world.

 Present Scenario of India: India falls under low income class according to world bank. It is second populated country in the world and around 70 % of its population live in rural area. 60% of people depend on agriculture , as a result there is chronic underemployment and per capita income is only $ 3262. This is not enough to provide food to more than one individual . The obvious result is abject poverty , low rate of education, low sex ratio, exploitation. The major factor account for high incidence of rural poverty is the low asset base. According to Reserve Bank of India, about 51 % of people house possess only 10% of the total asset of India .This has resulted low production capacity both in agriculture (which contribute around 22-25% of GDP ) and Manufacturing sector. Rural people have very low access to institutionalized credit( from commercial bank).

Poverty alleviation programmes and concepualisation of Microfinance: There has been continuous efforts of planners of India in addressing the poverty . They Have come up with development programmes like Integrated Rural Development progamme (IRDP), National Rural Employment Programme (NREP) , Rural Labour Employment Guarantee Programme (RLEGP) etc. But these progamme have not been able to create massive impact in poverty alleviation. The production oriented approach of planning without altering the mode of production could not but result of the gains of development by owners of instrument of production. The mode of production does remain same as the owner of the instrument have low access to credit which is the major factor of production. Thus in Nineties National bank for agriculture and rural development(NABARD) launches pilot projects of Microfinance to bridge the gap between demand and supply of funds in the lower rungs of rural economy. Microfinance . the buzzing word of this decade was meant to cure the illness of rural economy. With this concept of Self Reliance, Self Sufficiency and Self Help gained momentum. The Indian microfinance is dominated by Self Help Groups(SHGs) and their linkage to Banks.

Role of Microfinance: The micro credit of microfinance progamme was first initiated in the year 1976 in Bangladesh with promise of providing credit to the poor without collateral , alleviating poverty and unleashing human creativity and endeavor of the poor people. Microfinance impact studies have demonstrated that

Ø Microfinance helps poor households meet basic needs and protects them against risks.

 Ø The use of financial services by low-income households leads to improvements in household economic welfare and enterprise stability and growth.

 Ø By supporting womens economic participation, microfinance empowers women, thereby promoting gender-equity and improving household well being.

 Ø The level of impact relates to the length of time clients have had access to financial services.

Conclusion: After the pioneering efforts by Government, Banks, NGOs, etc the microfinance scene in India has reached in take off stage. An attempt could be initiated to promote a cader of new generation micro-credit leaders in order to strengthen the emergence of micro- finance institution (MFIs) so as to optimize their contribution towards the growth of the sector and poverty alleviation.

 Reference:

1. Dutt, Ruddar and Sundharam,K.P.M(2004): Indian economy S.Chand and Company publication, India .

 2. Soundarapandian, Dr. M.: Micro finance for rural entrepreneurs, Kuruskhetra, septembar,2006.

 3. www.sbp.org.pk/reports/quarterly/FY05/first/Special_2.pdf.(visited on 25th oct,2006.)