Asia grapples with rural poverty despite high growth
By Sugita Katyal
NEW DELHI: In a remote village in northern India, a group of women try to save just Rs10 each every month. Sometimes even that isn’t easy. If there’s a drought in their desert state of Rajasthan and the crops fail, the women often skip the payment meant as a group saving for a rainy day.
The women of Madri village represent one of the starkest truths often glossed over by spectacular growth and booming urban economies in Asia: millions still live in unimaginable poverty in the countryside with little or no access to clean drinking water, health care or education.
“The world’s attention is focused on sub-Saharan Africa, but there’s a huge problem of poverty in Asia which is not recognised,” Shiladitya Chatterjee, head of the poverty unit at the Asian Development Bank in Manila, said.
“Although the number of poor had fallen substantially in the past decade, we still have 60 per cent of the world’s poor. And poverty in Asia is predominantly a rural phenomenon.”
ADB figures show the number of people living on less than a dollar a day in Asia fell to 621 million in 2003 from 922 million in 1990 — but the numbers don’t tell the whole story.
Across Asia from India and China, to Indonesia and Vietnam, millions still live in dirt-poor mud or bamboo huts, untouched by the winds of economic liberalisation.
In India, far from the glittering city shopping malls, fancy cars and designer labels, millions in the countryside still live in squalor with little or no access to healthcare or schools.
Despite years of more than 6 per cent growth in Asia’s third-largest economy, millions of India’s landless and heavily indebted farmers are forced to migrate to the cities in search of a living — which is rarely easy.
Kedar Nath, a poor farmer from the most populous state of Uttar Pradesh, has been working as a sweeper and security guard in Delhi for 10 years trying to scrabble together Rs50,000 to pay his debts. He still hasn’t.
“The interest payments are backbreaking,” complained Nath, a scrawny, grey-haired man who sleeps and cooks under a tarpaulin behind a rich Delhi home equipped with modern amenities from microwaves to state-of-the-art computers.
“I barely save Rs500 from the Rs3,000 I make every month. How can I repay my debts?”
Economists say one reason for the slow pace of poverty reduction in South Asia compared with China and Southeast Asia is that there is little manufacturing growth to absorb labour.
Also, foreign investment is focused on capital-intensive projects and not the farm sector which is still technologically backward and highly dependent on the vagaries of the monsoon.
“Surplus labour from agriculture has to be absorbed into manufacturing,” said the ADB’s Chatterjee. “In Southeast and East Asia there has been growth in secondary employment because of manufacturing, but not in India and the rest of South Asia.”
So while the total number of poor has fallen, the divide between rich and poor has deepened: while the rich are becoming richer the poor are still in the same place.
In China, tens of millions have been lifted out of abject poverty since the Communists came to power 56 years ago.
But the wealthiest 10 per cent of China’s urban households still own 45 per cent of the urban wealth while the poorest 10 per cent have less than 1.4 per cent, Chinese statistics show.
Beijing has taken steps to increase rural incomes, allowing grain prices to rise and starting direct farm subsidies. It has also scrapped the agriculture tax, a centuries-old institution.
But some of the measures, while lightening the burden on farmers, have bankrupted local governments, which are forced to raise cash elsewhere. The once robust Communist social safety net has vanished, and rural dwellers now pay for things such as education and health care.
China’s “Gini coefficient”, a measure of inequality used by economists on a scale from zero to one, is believed to be above 0.45, among the highest in the world. The closer to one, the greater the inequality.
The yawning gap is evident in India too.
Economists say consumption per head among the top 20 per cent of the urban population has increased about 40 per cent since 1989-90.
“Growth alone isn’t enough; reduction of vulnerability is the most important issue,” said Ananya Basu, an economist with the World Bank’s poverty reduction unit in New Delhi.
“Pro-poor growth is good, but targeted intervention is also important, mainly in social sectors.”—Reuters
