Global factors, local forces or animal spirits – what drives the Rupee down ?
As the Indian rupee nose-dived this past week, and stock markets were enveloped in gloom, pundits struggled to decode the answers to this question.
One thing however was painfully clear : the consequence of the lower rupee would be higher prices for all of us.
– we would pay more for fuel, fertilisers and every item that had imported parts
– we would pay more for our loans, as the Reserve Bank of India raised interest rates, in an effort to keep FII money from flowing out
How did the Indian economy, hailed as a roaring tiger just a few years ago, reach this sorry state ? What triggered the fall and what sustains the rupee’s downward momentum ?
The first global trigger was the suggestion by Ben Bernanke on June 19, 2013, that the central bank of the USA was prepared to begin phasing out it’s Quantitative Easing (QE) Program. As a result bond yields in the USA rose, and markets across the world fell, as Foreign Institutional Investors (FIIs), pulled money out of equities and emerging markets to invest in US treasuries.
Economies such as India, which had developed dependencies on FII inflows to fund their Current Account Deficits, faced immediate and painful adjustments.
A second trigger came earlier this week, as fears of military action against Syria escalated. As the price of Brent crude spiked, markets assumed that rising oil prices would undermine growth – especially for countries highly dependent on oil imports.
However these factors affected many emerging markets. Why have the currencies of Mexico, South Korea and many eastern European nations held up so well, while the currencies of countries like Turkey, South Africa and India have plummeted ?
The answer is that FII’s are differentiating between countries. They are looking at the fundamental factors driving each local economy and choosing where they wish to place their bets.
Countries that rely most on short-term foreign money to fund trade deficits have been the hardest hit. India has a Current Account Deficit (CAD) of 5.1 % of GDP (Turkey is at 5.9%, S Africa at 6.3%)
But even this does not fully why FII’s are pulling more money out of India, hence causing the Indian rupee to weaken more than other currencies ?
The answer lies with the elusive animal spirits.
There is a change in guard at the Reserve Bank of India. Markets will observe carefully to see if the new governor, Dr Raghuram Rajan, will take as strong a stance as his predecessor Dr D Subbarao, on inflation, monetary policy and the autonomy of the central bank.
More importantly it is clear to Investors that the Indian political establishment will cater to vote bank politics rather than focus on economics in an election year.
To quote the Wall Street Journal, dt Aug 29, 2013 : “If India’s fiscally irresponsible “antihunger “ bill passes the Upper House, while needed structural reforms languish, don’t be surprised if pessimism over the country’s future deepens.”
What is the way out of this situation ?
The markets, like all of us, are looking to see decisive actions by the Government, that will help restore confidence in the Indian economy. Three simple steps will not only stem the fall of the rupee but also set the Indian economy back on the path of growth :
1) Rein in Government Spending and bring the fiscal deficit under control
2) Take quick measures to address the Current account deficit
3) Start seriously undertaking pro-growth reforms
As Terrence Checki of the New York Federal Reserve stated “Fundamentals are Fundamental”. Three simple words that our Policy makers and politicians would do well to heed.
In 2009, I stood for the Lok Sabha, National Parliamentary election as an Independent Candidate for South Mumbai. Though I lost, I learnt a great deal about my city and the people at its heart. It was the beginning of a journey, and one that I knew, I would devote the rest of my life to.
At the time, my step was considered quixotic by many, who regarded it as tilting at the windmills of the powerful Indian political establishment. Yet, in the four years since then, I have been delighted to see a rising wave of other independent citizen candidates and newly formed political parties, start to contest local and state elections.
It is as if the floodgates have opened, and the common citizen, the Aam Janta have said “Enough”. The initial reluctance of our generation, to participate in a political process widely regarded as venal and corrupt, has given away to the realisation that Politics matters. We can no longer abdicate the space of Governing our nation to the lowest common denominator. We can and must participate constructively, not just in the political debate, but in the process itself.
In the past four years I have been asked repeatedly if I would stand again; from which constituency and what my campaign strategy would be. Friends and well wishers have been generous with advice and offers of support, that I greatly value.
But it was a simple question from a child that has dominated my thoughts over the past four years. “Why are you standing” she asked, “and what do you stand for ?”
To answer this question, I started to undertake a series of exploratory journeys. The first into the issues that our country grapples with. The problems of education and health; of law and order and human rights; of poverty and corruption; of water, energy and food security…and of the best practices and policies that India could adopt, to address these challenges.
But it soon became evident that my ideas were shaped by my own background and perspectives – that of a banker who had grown up in urban India. In my years of banking I had learnt one thing – if you make the wrong assumptions, you make the wrong decisions – and such mistakes can be very expensive. There is no better way to understand the business and prospects of clients than to spend time with them in the field and understand the dynamics and drivers of their business.
Since India lives in her villages, it became clear to me, that this is where I would have to go. So in the summer of 2012, I embarked on a journey to the villages of India. During the course of the year I visited 15 states and spent time in over 120 villages. For the most part I traveled by public transport and lived in the homes, for a day and a night, with the women beneficiaries of my bank’s foundation.
Some of the stories of the journey have been shared with you through this blog and posts on Face book and twitter, and much of it still remains to be told. But the thread that ran through each and every step of this path, was that despite all the cynicism and sense of hopelessness that we experience when we watch TV or read the papers, the heart of India beats strongly.
The dignity and generosity with which I was welcomed into the homes, of women who had very little, will stay with me for ever.
In home after home, my hostesses refused to take any compensation for the hospitality they provided me. The true meaning of “Atithi Devo Bhava” came home to me when in one instance my gift of a saree was gracefully accepted and then in return I was presented her “shaadi ka joda”. Despite the hard physical labour which they put in over long hours (women everywhere in our country rise at dawn and work till late at night), there was always time for the sharing of stories and for the gift of laughter. It became abundantly clear to me that the women of our country have very big hearts and very broad shoulders.
But it also became clear to me, that we are eroding this moral fibre of our people with the policy of hand-outs and give-aways that every political party is adopting for short-term electoral gains.
In Gram Sabhas, I was often asked aggressively by male villagers, as to what I had come to give them. The plethora of Government schemes driven by electoral promises, delivered inefficiently and with innumerable leakages, is creating a climate of entitlement. This is worsened by well-meaning NGO’s who see development through the lens of charity.
In other villages I was asked for help in accessing bank loans. Initially very pleased at this request, I was distressed to learn the reason bank loans were preferred to all other forms of credit was that “they never had to be repaid – as they were invariably written off before the next election.”
Flag ship schemes such as MGNREGS, which if well executed can transform districts (ref my blog on the Bankura experiment) are in general so poorly implemented that they are becoming major vehicles for corruption and theft. Villagers across the country confided how they had received money despite doing no work, but also shared that they did so in the knowledge that everyone up the chain had taken a much larger cut. “Is it not fair that we should get our share ?” was the simple question.
So we have embarked on a path, where policies that ostensibly aim to provide social justice and inclusion are becoming ruinous. From the recent experience of some countries in Europe, it is clear that such policies are not financially sustainable in the long run and result in the impoverishment of the finances of a nation. What is worse, is that through the collateral damage they create, they impoverish the soul of a nation.
We are converting a proud and dignified people into those who are dependant on hand-outs. This will destroy the future of our children.
The second major concern that I gathered on this journey, was the erosion of faith in our Institutions. The common man has begun to doubt the pillars that are the very foundation of this country – the police, the judiciary, the CBI, various constitutional bodies, and even the Armed Forces.
These are institutions that we look up to, to uphold our rights as free citizens – no matter what our social status or incomes, no matter what our gender, community, caste or religion. We can only be equal in the eyes of the law if there are institutions that defend and uphold our rights, not just in letter but in spirit.
But sadly, whether this is justified or not, the people of India have begun to feel that the integrity of these important institutions have been compromised. This will erode the faith of citizens in the state and the very basis of our democracy.
We are at a tipping point.
Ours is a nation of hard-working, innovative, entrepreneurial people who are decent, God-fearing and honest. Our people have no need for charity, nor is it in their nature to cheat or defraud anyone. We are not a corrupt nation but sadly some of our leaders are. It is not the people of India who have let our country down, but regrettably much of our political leadership has.
It is time for all of us to take a position in defending what we believe to be right. And so, this is why I stand.
And this is what I stand for :
I stand for the soul of India.
I stand to uphold the integrity of our institutions.
And I stand for the dream of every mother who believes that the future of her child will be bright – based on his/her own hard work and because she/he had no more, but also no less, than a fair and equal opportunity.
A train journey of 9000 kilometres around India with 450 young aspiring entrepreneurs – the idea was intriguing…
My journey to the Jagriti Yatra started on Gandhi Jayanti this year. Invited to address the Yatris at a function on 2nd Oct, at the Tata Institute of Social Sciences, I was captivated by the passion and energy of the young people who filled the room. Drawn from all over India, they shared how their experience on the Yatra had transformed their perspective and in some cases their lives.
Inspiring as the stories of the journey were, what was really interesting was the theme : Building India through Enterprise. This then, was more than just a fun exercise in experiential learning – Yatris were selected both on the basis of their ideals and their dreams – of a better India driven by entrepreneurship.
The idea of the trip was to provide an immersive learning experience (live in sleeper class compartments on a train for 15 days); visiting role model institutions (from Infosys in Bangalre to the Barefoot college in Tilonia Rajasthan); using Case study methodology (intensive Group discussions within Cohorts designed to be diverse) and building a support network of like minded individuals who care deeply about building a better India.
I was hooked ! This seemed a perfect continuum of the journey I had begun in April, to the villages of India. So I signed on to be a Resource person for the 2012 Yatra that commenced on December 24.
Through my blogs over the next 15 days, I would like to share some of the vignettes of this fascinating journey.
Today is Day 3 and we have covered about 800 kms.
We started on the Eve of Christmas from Lokmanya Tilak Terminus in Mumbai, after a day of orientation at TISS. Christmas Day was spent on the train, getting to know each other, and adjusting to our new home.
The Yatris are an interesting bunch : 375 aspiring entrepreneurs aged 20-25, and 75 slightly older participants who form the organising and facilitating team, many of whom are ex-Yatris themselves.
This year 18000 registrations were received for the Yatra, of whom 375 participants were finally selected. 35 are international participants representing 12 countries. The Indian participants are drawn from 24 Indian states. 39% are female and 57% come from semi urban and rural backgrounds.
The chemistry between Yatris is fun to watch – adjustments as people jostle for space : physical, mental and philosophical !
Yesterday we disembarked for the first time, and journeyed from Dharwad station in Karnataka to the small village of Kalkeri. There, at a unique residential school for children from the poorest families, we witnessed a modern day Gurukul.
It was started 10 years ago by a group of young Canadian, French and Indian musicians, united by a passion for music and for bringing about social change. Today the school houses 200 children, half of whom are girls, and many of whom come from single parent families or are orphans.
The children are taught classical Hindustani music, Bharat Natyam, and Drama, in addition to the regular school curriculum of the Karnataka state syllabus. The quality of education provided to the children was immediately evident as the young girls and boys, many no older than 5 or 6, came up to the Yatris and confidently start conversing in English. When they performed on stage – singing classical hymns; playing the tabla, harmonium or sitar; the performances were so professional that it was hard to believe they were just children.
The vision, that guides the teachers, is simple but beautiful : they believe that by providing opportunity you provide hope. So they try to create opportunities for these children to realise their musical dreams…
At the Kalkeri Sangeet Vidyalaya we met 2 role model institutions who shared their stories and their business model.
The first was SELCO, which has had unique success in carrying solar solutions to the remotest part of rural Karnataka. The second Toe Hold Artisans, a co- operative of Kolhapuri chappal manufacturers from the village of Athini in Karnataka – a wonderful example of how powerful transformational change can be driven at the grass roots.
The Yatris will discuss, critique and present these Case Studies over the next two days to the larger group. As we listen in to their discussions, their perspectives and conversations are fascinating and often unexpected !
But everywhere is a common thread – the thread of dreams that range from changing India and serving our people, to building businesses that will be global giants.
As I walk through the compartments, I feel as if I am walking in the shadow of these dreams…and as these young Yatris awake to their full potential, and start realising these dreams, India will be a better place.
“Don’t worry,” said Daniel, our soft spoken driver, as we drove towards our destination, “these are political matters, but no one will trouble tourists or students. There is so much that has improved here, but no one talks about it”.
Reading press reports on tensions in the region, and recalling the deforested hill slopes, ravaged by land slides from my previous trip 19 years ago, I had almost cancelled my trip to Darjeeling last week.
However, as we navigated the steep bends of the scenic Punkhabari route, on our way back from this Queen of Hill stations, I recalled Daniel’s words, and was so glad that I had continued with the trip. In addition to the lovely cool weather that was such a welcome respite from the heat of the plains, Darjeeling was cleaner and greener than I had remembered.
The overwhelming impression, was that there was someone thoughtful, in charge of the small things that make a city beautiful and welcoming – something that is sadly lacking in many of our cities today. Shared below are a few of the things that lifted my spirits :
The Tea : It is said that there is more tea sold as Darjeeling leaf, than is produced on the slopes of Darjeeling. However from the very first aromatic cup that I tasted, it was clear that there was both intent and investment on re-establishing the Darjeeling brand as the most premium tea in the world. There were small boutiques selling both regular and exotic teas, and also a few tea houses, where one could sample teas from different estates, including the delicate first flush teas which had just been produced.
Following in the lead of Rajah Bannerjee of Makaibari tea estate, most Darjeeling tea estates have gone organic. Rajah has set the lead in more ways than one, most notably in empowering the women working on his estate, through the innovative Hum Tera Homestay Eco- tourism program, where visitors to Makaibari stay as paying guests at the homes of villagers. Given the stress that had existed between planters and locals not so long ago, it was very nice to see an example of enlightened management. In Rajah’s words : “The new mantra for the future is holistic partnerships not ownership”
The Trees : At an average height of 6700 ft Darjeeling is a part of the Eastern Himalayan zoo-geographic zone. Flora in this region comprises semi-evergreen, temperate and alpine forests. In the past century, dense evergreen forests of pine, sal and oak surrounded the town, where a wide variety of rare orchids were found. Over the past several years, deforestation due to increasing demand for wood fuel and timber, had denuded the slopes, and landslides as a result, were frequent.
It was therefore a real pleasure to see Darjeeling green again – clearly the bulk of the credit must go to the Forest Department for a systematic and sensible afforestation campaign. However as was clear from the simple hand painted signs on tree after tree, citizens have played their part too. Trees have been planted over the past 15 years by senior citizens and school children, and the girth of the trees is testimony to the fact, that they have been carefully nurtured.
The Plastic : In 2009, the Darjeeling Municipality, like many others across the country declared a ban on plastic bags. Unlike in other cities however, this ban seems to have been enforced. Experiencing this first hand in the Bata shop at the Mall, I was somewhat bemused to be handed my purchase wrapped in newspaper !
The consequences are visible on the streets which are noticeably not just free of plastic, but also remarkably clean, given the rush of tourists. There are segregated waste bins everywhere and I was reminded by the courteous young man serving me an ice cream cone, to make sure I disposed the wrapper correctly ! Perhaps it is the sense of ownership and pride that permeates the residents, or just simply the pleasure in having a clean environment that has led to this result – either way it was very good to see.
The Schools : Having been the summer retreat for the British in Eastern India, Darjeeling became the place of choice for the establishment of public schools on the model of Eton, Harrow and Rugby such as St. Paul’s School, St. Joseph’s (North Point) and Loreto Convent. In the years of strife many of these institutions suffered. It was wonderful to see how they have been restored and how many of them have reinvented themselves. Under the guidance of Father Tshering Kinley, for example, St Joseph’s North Point, started a program during the winter months, when the school was otherwise closed, to open it’s doors and offer its excellent facilities to the poor children of the tenements around the school.
As I walked through the precincts of these beautiful institutions, listening to teachers exhort their students to “pay attention to clear enunciation”, I was struck by the debt of gratitude generations of Indians, including myself, owe to the missionary nuns and fathers, who gave us our education.
The Sights : Given that a major contributor to the economy of our Hill Stations is tourism, in most places little thought is given to making local “places of interest”, interesting.
On my past visit to the Darjeeling zoo, I recall the same sad feeling that one experiences in many zoos across India – crowded and dirty cages & enclosures; insensitive visitors teasing and tormenting animals and litter everywhere. Though the zoo had a host of interesting and rare animals not found in other zoos in India, such as a Siberian tiger and a Peruvian Llama, I was glad to leave after a short visit.
It was a delight to have an altogether different experience this time. Starting with the ticket counter (where one paid Rs 40 for a beautifully printed entrance ticket offering joint admission to the Padmaja Naidu Zoo and Himalayan Mountaineering Institute) till the well appointed Internet cafe on the premises, it was clear that both institutions had adopted best practices from tourist destinations across the world. The facilities were spotless, attendants were courteous but firm, sign boards provided interesting information and there were flowers everywhere.
The small but well cared for selection of native Himalayan animals (such as the Red Panda, Himalayan wolf, Snow leopard to name a few) were part of a Scientific Conservation breeding program. In the HMI, the quest to conquer Mount Everest, initially by Mallory & Irvine, and finally by Hillary & son of the soil, Tenzing Norgay was beautifully detailed.
At many times during the visit, I found myself smiling with the pleasure of learning something new and unexpected – and walked out feeling I had spent a wonderful morning.
Were there areas that needed attention and improvement ? Yes.
The roads were in worse shape than I have seen anywhere else on my journey so far – including some remote village roads. The tax of this on the taxi operators who ply tourists up and down the Himalayan foothills must equal at last 50% of the life of their cars. For a city that relies on tourists, this seems to be an area that needs urgent attention.
The water situation was grim. For ordinary residents of the city, long waits with jerry cans, and carrying these heavy loads to their homes is a daily occurrence. Given the heavy rainfall in the Darjeeling area it is inexplicable that there is not more focus on water harvesting.
Notwithstanding the greening of the slopes, it does appear that town planning is under stress, and the pressure of construction, much of it haphazard is taking its toll.
And of course, there is the simmering tension of unsolved political matters, that lies beneath the surface…
Nevertheless, all said and done, this was, on reflection a cup that was more than half full, and one which many of our other cities could do well to savour !
As I have travelled through the country, it has been rare to find anyone who speaks positively about the National Rural Employment Guarantee Scheme (MGNREGS) colloquially referred to as the Sau Divsi (100 day) scheme.
Passed as an Act of Parliament in September 2005, the NREG Act aimed to provide for the enhancement of livelihood security of the households in rural areas of the country by providing at least 100 days of guaranteed wage employment in every financial year to every household whose adult members volunteer to do unskilled manual labour.
In order of priority, the Act encouraged a focus on :
1) Water Conservation & Water Harvesting
2) Drought proofing through afforestation and tree planting
3) Irrigation canals ( micro and mini irrigation works)
4) Provision of irrigation facilities to SC/ST households
4) Renovation of traditional water bodies including desilting of tanks
5) Land development
6) Flood control and protection works
7) Rural connectivity to provide all weather access
Well conceived, the Act provided for a series of checks and balances to encourage decentralisation and prevent abuse and mis-appropriation of funds such as making Gram Panchayats accountable for identifying projects and executing and supervising work; direct credit of wages to the beneficiaries’ bank or post office account; distribution of wages ideally on a weekly and no later than fortnightly basis; and providing for an unemployment allowance if work could not be provided within 15 days of the request for work.
From a policy perspective therefore, the Act seemed to provide a good framework to meet its objectives.
However feedback in village after village, across all the states I have visited, was negative. Where job cards were available, no more than a few days entries could be found. Villagers complained of payments delayed by several months. In many areas there were allegations of corruption at the VCDC or Gram Panchayat. Level. Some villagers even stated they had received payment for doing no work – adding that Panchayat members withdrew 3-5 times the amount they received for facilitating such payments.
As for outcomes, other than village roads (which I have to say, have by and large been excellent) little was to be seen in the form of durable assets or water harvesting structures. Given that this was the flagship Poverty alleviation program of the Government with a budget allocation of Rs 40,000 crores in 2011-12, I began to actively search for success stories under NREGS.
It was therefore very encouraging to come across an excellent implementation of NREGS in Bankura, West Bengal.
The district of Bankura, located on the eastern edge of the Chhota Nagpur plateau, can be divided into the semi arid and relatively poor western region, and the fertile relatively richer Eastern region. The population of Western Bankura comprises more than 50% of Scheduled Castes & Scheduled tribes (SC/ST), predominantly Santhals. Over 50 % of the families are classified as Below Poverty Line (BPL) and the literacy rate is below the national average at 54%.
The area is almost entirely rain fed, with subsistence agriculture being the main occupation. 65% of farmers are classified as marginal, with land holdings below half a hectare, and 32% as small, with land holdings below 1.5 hectares.
Originally a densely forested area, (21% of the area is still classified as Forest land) growing deforestation has led to a steady decline in soil fertility, due to soil erosion. The Adivasi tribal inhabitants of the region also report that rain patterns seem to have changed. Now classified as a highly drought prone area , migration eastwards from Bankura in the dry season, to the Burdhwan and Hooghly districts of W Bengal, but also to other parts of the country, traditionally exceeds 50% of the adult population. The saying in the region is “like our water, our people flow each year to the east “
Should they be unable to migrate, the only other livelihood option, (typically undertaken by women) is scouring river beds for stones, breaking these into smaller pieces and selling them for road construction work @ Rs 5 per “jhudi” (small bunch of stones – typically in a circle of diameter of 3 ft).
In short, a region inured to tremendous hard ship and back breaking work.
The success of the NREGS scheme in Bankura (now also extended to the districts of Purulia and West Midnapur), viewed in the above context is all the more remarkable.
For the first time on my journey, I was able to see job cards that reflected close to 100 days work and bank accounts that reflected corresponding payments. More importantly, in all the villages I visited, there were water bodies that had been constructed by local villagers under NREGS : large village ponds, smaller village tanks (Hapas) and tiny seepage tanks – as a consequence of which farmers were undertaking SRI cultivation of paddy, and growing vegetables and lentils on land, which otherwise would have lain fallow.
Most inspiring of all, was the very innovative scheme of Mango orchards and Social Forestry, whereby landless women formed Self Help Groups (SHGs) to lease barren land for 25 years, under a crop sharing scheme, and used NREGS funds to treat the land and plant orchards and timber. The pride on the face of these women as they showed me their orchards, was testimony to the fact that proper execution and a focus on Outcomes, can convert an Employment guarantee scheme into a meaningful program that creates Durable Assets which provide sustainable Livelihoods for the poor.
Much of the credit for the Bankura experiment goes to the NGO Pradan, who have been working in the region since the mid 90s on Integrated Natural Resource Management (INRM) and Livelihood enhancement.
Through their bi-partisan and apolitical approach they had won the trust of not just the local communities, but also District, Block and Village level Govt officials, as also the elected representatives of the various Panchayati Raj Institutions (Gram Panchayats, Panchayat Samitis and Zilla Parishads).
In 2007 with the assistance of an enlightened Block Development Officer (BDO) by the name of Babulal Mahatao, and the blessings of the local PRIs, they conducted a pilot, to combine the power of NREGS, with the principles of INRM.
In the Hirabandh block of Bankura district, they selected 3 villages under the Gopalpur Gram Panchayat, for comprehensive water conservation and harvesting works. To achieve lasting results works were planned to suit the topography of the land.
Land in the Bankura district is locally classified as upland (Taand), Medium upland (Baid), Medium lowland ( Kanali) and Lowland (Sol). Generally the higher the land, the poorer the soil quality, and therefore the poorer it’s inhabitants.
In order to ensure the buy-in of the entire village, including richer and more powerful farmers, but also to address water conservation on a long term basis, Pradan recommended a comprehensive Ridge to valley, water conservation and harvesting process. However work was prioritised from Upland to lowland treatment (i.e poorer to richer).
In the Uplands, the land lease scheme for orchards and timber described above, was implemented along with water conservation treatment to reduce the velocity of water run off. Described as the 30 : 40 model, 30 feet bundhs were built along the slope, and 40 ft bundhs were built across the slope thus ensuring water velocity was reduced. The area that was dug out to provide mud for the bundhs, became a water reservoir. Soil erosion was thus reduced, and moisture content of the soil increased. The Orchards and timber plantations, further helped to bind the soil in addition to creating a durable asset for the women who leased the land. Until production started, women practised inter cropping between plants growing vegetables that were an additional source of income for them. A win win on many counts !
For the Midlands they conceived the widespread implementation of the 5 % Individual Benefit scheme. Recognising that small and marginal farmers could rarely afford the cost of pumping and transporting water from the village pond to their small plots, they planned the construction of several water tanks (Hapas) dug on 5 % of the farmers own land. As the soil in the region is rocky, water retention is good, and rain water is stored in these tanks. While all those who work on digging the Hapa are paid under NREGS (@ Rs 136 per day), the farmer on whose land the Hapa is dug, acquires a permanent and valuable irrigation source. As a saturation approach was planned at the outset, villagers had clear sight of when their plots would be covered and there were no tensions or jealousies in the community. As workers were also owners of the asset, the quality of work that I observed was uniformly good.
In the Lowlands, small seepage tanks were constructed, which filled through seepage of ground water resources, providing farmers in the lowlands with a small but almost perennial source of water.
The success of these schemes, and the buy-in of villagers, ensured that the pilot started being replicated across the district. Pradan was chosen as the facilitating agency for NREGS in Bankura.
The results have been impressive. From 2008 to 2012 a total of Rs 150 million has been spent on INRM related NREGS work in the Bankura district. Over 5500 ST families, in 119 villages, have been provided with 8.3 million man days of work. Equally important 3600 small water bodies (Hapas and seepage tanks) have been constructed. In the Hirbandh block alone approx 100 hectares of mango orchards have been planted.
More impressive than these statistics, is the impact on the villagers of Bankura. Though still very poor, there was a sense of deep pride and dignity, about the women I met. As they welcomed me into their homes and offered me their hospitality, many shared the same stories. Just 2 or 3 years ago, they said, they would not have had the ability to offer me anything. Today the combination of NREGS wages for works in their own village, in addition to the incremental income generated from vegetables, mangoes, etc had made it possible to offer a stranger hospitality.
As they shared their dreams and fears, several said that all that they wished for, was not to have to leave their homes again, in search of water, food or employment. In 2010, when the region faced a major drought, a mass scale migration was feared. Instead, due to the availability, howsoever limited, of water, and the employment guarantee under NREGS, there was almost no migration from the District.
The Bankura experiment has filled me with hope. It proves that NREGS can be successfulm and is worthy of emulation across the country.
It also shows that there is scope for Innovation : if the demand for work can be combined with projects that are optimised to meet local needs, then Sustainable livelihoods, Durable assets and Water security are all Outcomes that are possible.
The villages of Assam are beautiful.
Surrounded by lush green paddy fields, bamboo clusters and tall slim Areca (betel) nut trees define the boundaries of each village, and within the village of each homestead. Eco friendly, and customised to suit Assam’s climatic conditions, the walls of houses are built of bamboo, and covered with mud. Roofs which were traditionally of thatch, from the tall elephant grass native to the area, are gradually being replaced by tin roofs. Each home generally has its own water source in the form of a well or a hand pump and sometimes more affluent households also have a small fish pond.
Adjacent to the house is a small vegetable garden, a few fruit trees (typically mango, banana, pineapple, Assam lemon, and Areca nut) and an animal shed (most homes have at least one cow, a few goats, and a few chickens or ducks, and if it is a tribal home often a few pigs). There is usually a small bathing space adjacent to the well, with walls made from dried Areca leaves. The boundary wall of the homestead is constructed of similar material, providing privacy yet easy passage.
A homestead traditionally consists of 4 rectangular rooms built around a courtyard. The first is the living room, the second the kitchen, the third the store room and the fourth a shed that houses the family loom and farm implements. At the centre of the courtyard is the place of worship. In Bodo households this takes the form of a Cactus (zizu tree) which is the symbol of Bathou their supreme God. In Hindu households one usually finds a Tulsi plant (holy basil) taking centre place. In the homes of the tea tribes one finds further elements of decoration with designs on the walls often embedded with small pieces of glass. Betel leaf (paan leaves) are grown as creepers on the walls. Flowering plants are found in every home, providing both fragrance and beauty.
Assamese villages are not just aesthetic but also very clean. Homes here, like in villages everywhere in India, are spotless. What is noticeably different, is how clean the common spaces and pathways are. This is true across the board, of tribal villages, migrant villages and mixed community villages. Homes are generally organised in a geometrical grid, on either side of straight pathways, overlooking their own farms. Land holdings vary quite considerably in size, with the average size across Assam (as per official statistics) being 1.1 hectares.
Every village has a common community hall, adjacent to a small temple or namgorh. Most of the meetings I had with Women’s Self Help Groups and Farmers clubs were held in such halls. Open sided and airy, but covered with a sturdy roof, to keep out the rain, these provide an all weather meeting space, for the village. They also serve as the community space for music, dance, theatre and religious discourse in a tradition established by the great Assamese Bhakti saint Sankara Deva who provided Assam with a sense of cultural identity and unity in the 15th century.
I was also delighted to find that every village has a Primary school (up to Class V) with spacious play grounds. Mid day meals are provided free of cost and attendance is good. Teachers are usually from the village itself. Many of these schools are set up as “Venture” schools, whereby some resources are provided by villagers, and the state provides a grant in addition. This seems to provide the much needed element of local parental control to ensure the desired quality of education. Middle / High schools usually serve a cluster of villages and are generally within a radius of 5-7 kms. Both children and adults use bicycles to commute and the quality of roads (as attributed through sign boards to the Pradhan Mantri Gram Sadak Yojna !) is excellent.
In contrast medical facilities seem sparse and inadequate. Where Primary Health centres exist, they are usually unstaffed or at best staffed by a compounder. Many villagers attributed this to past insurgency where doctors were often victims of kidnapping or extortion. Though the region is rich in medicinal herbs, practitioners of traditional medicine, were few and far between. Thanks to the national Maternity health program that incentivises delivery at a hospital rather than at home, mid wives are also a vanishing breed.
Families are generally small with an average of 2-3 Children. Elders seem to be an integral part of the household, and are treated with obvious respect and care. There appeared to be no gender bias, with girls and boys treated with the same amount of affection and provided with equal access to education. Villagers acknowledged that there was a cultural bias towards superstition, and many spoke in hushed voices of black magic and witch hunts.
Several villages have been provided electricity through the Rajiv Gandhi Grameen Vidyutikaran Yojna, though electricity supply tends to be erratic. Villagers pay for electricity, reporting rates of between Rs 4.20 per unit to Rs 9 per unit ! Construction of toilets is limited – ranging from 10- 40 %. Penetration of mobile phones was high, averaging 75-90%.
There has traditionally been no culture of individual savings, but over the past year the women have taken to the concept of Savings cum loans SHGs enthusiastically. Average savings range from Rs 10 – Rs 25 per week. Loans are granted to members at interest rates of 2 %. – 4% per month. When I expressed surprise at the high rates, they patiently explained that it made calculation easier ! They also explained that as profits would be shared amongst members of the SHG, the rate in itself did not matter…a good lesson in the principles of co- operative banking. No more than 2-3 women in each village had a bank account, and there was a general complaint that banks were both too far and too unresponsive to be useful (average of 5 day long trips to open an account).
Identity papers in the form of ration cards, or voter ID cards were rarely available. No one had heard of the UID or Aadhar project. Job cards were available with BPL families but usage of the MG NREGS scheme was limited – and experience of receiving payments was poor. The general perception was that there was a fair amount of corruption associated with the scheme, though on probing there was very poor knowledge about the actual details.
Mahatma Gandhi describing the ideal of Gram Swaraj, said ” Independence begins at the bottom… A society must be built in which every village has to be self sustained and capable of managing its own affairs…”
Viewed from this perspective Assamese villages and households are almost completely self sufficient. They grow their own rice, vegetables and fruit, get fish and shrimps from the village ponds or paddy fields, milk from their cows and egg and meat from the animal they rear. They build their houses themselves from local material, and spin and weave their own clothes. Many traditional homes rear silkworms for the golden Muga or durable Eri silk, which forms a secondary source of income. Most households are also able to generate surpluses through the sale of rice, vegetables, meat and fruit, or of woven cloth bamboo and betel nut.
Not surprising therefore, that at the time of Independence Assam had a higher per capita income than the national Indian average. Given the relatively non feudal and egalitarian nature of Assamese society, and the self sufficient prosperity of its villages, Gandhi ji is said to have described Assam as Ram Rajya.
Regrettably the problems of the past few decades have disturbed this idyllic paradise. Ethnic tensions and violence have disrupted not just peace but traditional local self governance structures. There is little faith in the Village Council Development Committees (VCDCs that operate in Schedule VI districts such as Bodoland) where members are selected rather than elected. Though the performance of villages where there were Gram Panchayats with elected Panchayat members seemed to inspire more confidence, the general impression conveyed was that once appointed / elected local representatives got arrogant and corrupt.
Depending on where one was, there was a sense of reserve and wariness, and in a few cases of resignation and despair in the eyes of villagers. Though peace has returned to the region there is an under current of fear that this is no more than a temporary armistice.
This is truly a pity – for this beautiful state has much to offer its citizens and the rest of the country. Assam has the potential to become if not the food basket, the fruit and vegetable basket of India. With abundant rainfall, fertile soil and favourable climatic conditions the potential of this state is enormous.
To unleash this potential will take statesmanship – and also leadership in tackling issues that have reminded un- resolved for too long.