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Poverty


Poverty is an economic condition in which one is unable to enjoy a minimum standard of living. It is a state of existing state of amounts (of earnings or money) that are too small to buy the basic necessities of life. The visible effects of poverty are malnutrition, ill health, poor housing conditions, and illiteracy, illiteracy and so on. The poor people suffer from unemployment, underemployment and lack of access to resources that restrict their ability to earn a comfortable living. The causes of poverty are rooted in the complex web of cultural arbitrariness and demographic, economic, social, political and various other factors such as floods, cyclones and droughts.

A simple unidimensional definition of poverty followed in Bangladesh during the 1980s was the level of food consumption that provides calories of energy below what was required. Indirect estimates of the proportion of people in poverty were made according to the following method. First, a bundle of food providing the specified level of nutrition (2,112 kalories and 58 grammes of protein per capita per day) was identified based on a compromise between cost and consumer preference. Next, the families with a per capita income below 1.25 times the cost of the specified food bundle were classified as moderately poor, and families with per capita income below 85% of the threshold income for moderate poverty as extremely poor. This method was applied basically for measuring the incidence of poverty in rural areas. For urban areas, the threshold level of calorie consumption for measuring the incidence of poverty was slightly higher. Also the threshold level of calories per person per day was changed in different times under different policy considerations. Household Expenditure Surveys (HES) conducted periodically by the Bangladesh Bureau of Statistics (BBS) generates the data used for estimates on incidence of poverty in this methodology.

According to the BBS estimates, people living under the poverty line in rural areas in 1995-96 accounted for 47.1% and rural people in extreme poverty i.e, those living under hardcore (absolute) poverty line comprised 24.6%. The corresponding figures for urban areas were 49.7% and 27.3% in that year. BBS in 1995 used a 'Cost of Basic Needs' method to measure the incidence of poverty in Bangladesh and identified two layers - the poor and the absolutely poor. According to this method, 35.6% of the country's population were absolutely poor and the poor accounted for 53.1%. A multi-dimensional approach to poverty takes into account a range of quality of life variables such as nutrition, health and sanitation, security, housing, access to safe drinking water, education, life expectancy, access to resources, participation and institutional capacity to cope with crisis. In 2000, Bangladesh was ranked 132nd in terms of these and other related parameters integrated into human development index (HDI). The Human Development Report 2007-08 of UNDP ranked Bangladesh 140th in terms of human poverty and the Bangladesh Economic Survey 2009 of the Government of Bangladesh has recorded that 40% of the country's population lived below poverty line.'

Continued poverty in Bangladesh may be attributed to many factors including population pressure, limited per capita natural resource endowment, illiteracy, extremely small amount of per capita arable and forest land, poor health and sanitation services, environmental degradation, deforestation, excessive dependence on agriculture, natural calamities, large-scale deprivation of the women folk, and ill governance.

Following the Partition of Bengal in 1947, the government of Pakistan adopted a policy of discrimination against East Pakistan. It patronized role of private sector in development in West Pakistan, for which it also used more of the resources of the whole country, while development in East Pakistan remained dependent mainly on public sector with disproportionately smaller allocations. industrialisation in West Pakistan took place at the cost of deprivation of the province in the East, which continued to have an economy based largely on traditional agriculture. In 1958, the income of an average individual of East Pakistan was 74% of that of an average one of West Pakistan.

East Pakistan demonstrated a long-term poverty trend, which continued during' independent Bangladesh, as well. In 1985, the income of an average Bangladeshi was 40% of the income of a Pakistani, 19% of that of a Thai and 7% of that of a South Korean. There is another more remarkable aspect of the long-term trend in poverty in Bangladesh, a large proportion of the population at the lower end of the income distribution scale of the level of living today is substantially below what it was 50, 100, and 150 years ago. In 1830s, the agricultural wage rate was 6 kg of rice. In 1880s, it was slightly over 5 kg. In 1930s a day's agricultural wage could buy 5.5 kg of coarse rice and the figure was almost the same even in the beginning of the 21st century. But the terms of trade between industry and agriculture within the economy deteriorated for a farmer or an agricultural labour implying that an average person in rural Bangladesh is worse off today as compared to the earlier periods.

Much of the sufferings of the people of Bangladesh are associated with the devastation caused by the war of liberation in 1971. At least one third of the national wealth of Bangladesh was damaged in one year and the economy faced severe difficulties in its aftermath. The nation, although with the help of foreign aid, had to bear the cost of rehabilitation of ten million Refugees and twenty million internally displaced people. The global economic crisis, the price-hikes of food, fuel and fertiliser and increasing burden of the deficits in balance of payments hit the economy very hard. Crop failure and disruptions in flow of food aid to the country in 1974 aggravated the situation and pushed the country to near-starvation. The process of pauperisation was intensified and according to some estimates, people below the poverty line in Bangladesh reached 83% in 1975. In 1981-82, the figure was 74% and only later, the incidence of poverty started to decline. The economy, however, was in stagnation and suffered a new setback because of the damages caused by devastating floods of 1987 and 1988. The bumper crop harvests following the floods contributed to a high growth rate in 1988-89 and in the successive 2-3 years although there had been no sustained improvement in the poverty situation.

In the 1990s, millions of people faced the dehumanising effects of acute material scarcity because of inconsistent distribution and under-utilisation of land, lack of command of the poor over land and non-land resources, technological backwardness, disparity in income distribution and political upheaval. With a per capita income of US$ 423 (2005), Bangladesh remains one of the poorest, most densely populated, and least developed nations especially characterised by pervasive poverty in both rural and urban areas. Almost half of the country's population lived below the national poverty line during the period 1990-2004, when 41.3% of the population with income less than $1 a day and 84% with income less than $2 a day. The siyuation did not improve to any noticeable extent in the subsequent years. Instead, the problems of inequality and unemployment continued to aggravate. The Gini ratios in rural and urban areas in constant 1963/64 prices were 0.340 and 0.375 respectively in 1973/74, 0.362 and 0.365 in 1985/86, and 0.384 and 0.444 in 1995/96. In 2000, the share of the poorest 10% of the country's population in total income (or consumption) was 3.7%, that of the poorest 20% - 8.6%, richest 20% - 42.7% and richest 10% - 27.9%.

As the economy of the country is predominantly rural, the government of Bangladesh had been undertaking and implementing rural development and poverty alleviation activities since long. These activities include different sectoral and programme components such as rural co-operatives, credit, irrigation, livestock and fisheries development, rural industries, area development, infrastructural development, input distribution and training. Rural development programmes was given importance in all five-year plans in varying degrees to promote overall development of the rural poor.

Bangladesh Rural Development Board (BRDB) as the major government agency undertook a series of rural development programmes with the objective of reducing poverty through village-based co-operatives, human resources development, expanded irrigation schemes, improvement of physical infrastructure, increase in agricultural production, and creation of employment opportunities for the rural poor. Some of the poverty alleviation programmes implemented in the government are establishment of cluster villages (1988-93), institutionalisation of Vulnerable Group Development project (1990-92), implementation of Upazila Resource Development & Employment Project (URDEP), skill development training and assistance for self employment.

Government agencies such as the ministry of health and family welfare, BSCIC, department of social services, directorate of women affairs, local government engineering department, directorate of agriculture, directorate of livestock, and department of fisheries also have a large number of different poverty alleviation projects. Moreover, non government organisations (NGOs) run a remarkable number of target-oriented programmes and projects to improve the socio-economic conditions of small and marginal farmers, assetless poor and distressed women. Notable among these programmes are the group-based microcredit programmes of grameen bank, brac, asa, proshika and other local and foreign NGOs, the government initiated programmes like Swanirvar Bangladesh and Small Farmers Credit Project and donor funded special projects like Rural Finance Experimental Project, Bangladesh Swiss Agricultural Project and NORAD projects for small entrepreneurship development.

Also there are some traditional but less focused programmes of poverty alleviation in the country. These are food for work programme, Food for Education, Pension for Elderly People, Vulnerable Group Development, Housing for the Poor and Homeless and the programme of providing insecticides and high yield variety of seeds to rural farmers. The government has undertaken development initiatives to expand the area of non-agricultural activities in order to create more employment opportunities. All these have to some extent increased the entitlement of the poor, their social and economic awareness and empowerment. These programmes, however, had contributed little to improve the poverty situation in the country. The BBS revealed that the incidence of poverty at the national level was 47% in 1996 and could be reduced to 44.7% in 1999 and 42% in 2010. Dr Binayak Sena of BIDS observed that Bangladesh poverty dropped from 45.7% in 2005 to 32.1% in 2010, recording a drop of 13.6% points against 8.5% points observed nationally. The average reduction rate per annum was 4.25% at the national level whereas it was 8.68% and 8.4% respectively in Rajshahi and Khulna, but only 0.98% in Dhaka- this was revealed from the latest Household Expenditures Survey (HEI). Poverty alleviation, therefore, remains a challenge requiring a proper planning to combat it and a high level of commitment to implement the plans with skill and integrity. [S M Mahfuzur Rahman]