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town planning and poverty

Also known as city or urban planning, town planning is an interdisciplinary and dynamic field that seeks to understand how policies change in response to community needs, population growth, lifestyle changes and the needs of a changing population. Contemporary urban and regional planning techniques for survey, analysis, design and implementation developed from fields such as architecture, civil engineering, public health, economics and geography to further comprehend the welfare of people, control land use, design urban environments and enhance the natural environment. Urban areas will house 70 percent of the world’s population by 2050, getting town planning right is vital to ensuring that future areas are safe and resilient places, especially for the poorest of residents.

A Multi-Faceted Approach

Planning has and will play an important role in improving the quality of life in urban areas. It is also a critical support for tackling poverty. With its potential to expand accessible services and economic opportunities, informed city planning can help regenerate connection among persons, bring public health amenities and promote social justice. It should not be forgotten that the planning movement sprang from the public health movement and the Victorian slums in the 19th century. Planning went beyond the basic drive to deliver more homes in a sanitary environment to include community design and social separation. Thereby offering people a better way of life after both world wars.

Nevertheless, in order for planning to focus on poverty eradication, Kate Henderson, the chief executive of the Town and Country Planning Association said, “Planners must have the skills and opportunity to increase their understanding of places and how their work affects how people live their lives.”

How Does Town Planning Eradicate Poverty?

Different factors contribute to determining poverty levels in deprived neighborhoods such as unemployment, high housing costs, low education, health inequalities and low level of participation in public life. Despite the social separation that the planning movement has brought about, proper planning policies have the ability to bring about the interconnectedness between municipalities and authorities to reduce the social and spatial differences between people and groups. For instance, by decreasing the distance at which rich and poor individuals live with one another, URBinlusion has shown that social stability can be increased as well as the competitive power of cities.

Town Planning in Calicut, India

In Calicut, India, a city with a population of 437 thousand, people depend on the city for employment, education, healthcare and commercial needs. Along with municipalities, the Asian Development Bank has identified poverty reduction as a key sector for development. With a shortage of land for low-cost housing, social exclusion of the poor from decision making and increasing incidences of crime, a poverty reduction program that focuses on sustainable city development was implemented. By 2020, Calicut will be slum-free.

Sustainable town planning is the backbone of poverty reduction through slum improvement in Calicut. They did so by improving basic infrastructure and services in all slums, improving shelter conditions and improving human resource capability of the urban poor. Interventions included expanded coverage of ongoing poverty alleviation programs and strengthening and capacity building of local NGOs.

Town Planning in Caloocan, Philippines

Similar can be said about Caloocan, Philippines, a city with a population of over 1 million. Of this total population, 23 percent is unemployed. In 2002, the city government, along with many urban planners, launched a City Without Slums (CWS) Program that aims to provide low and middle-income families an opportunity to acquire decent housing at affordable costs.

The CWS program was launched with the support of the World Bank and U.N.-Habitat. It has led to the expansion of resources for the urban poor by improving the coherence of effort among on-going urban programs in Caloocan. The program is committed to improving the living conditions of the urban poor by promoting City Development Strategies (CDS) and city-wide slum upgrading.

Town Planning in Da Nang, Vietnam

Da Nang is a key economic area of central Vietnam with a population of 740 thousand persons. 80 percent live in the urban area. Nevertheless, substandard housing penetrates through the city of Da Nang.

Therefore, the Asian Development Bank along with the government and city planners aim to develop new infrastructure and upgrade their water supply system to promote stable urban management. Apart from this, they have launched programs focusing on poverty reduction and hunger eradication, through more jobs and appropriate solutions to pressing social concerns such as subpar health services. The city is currently facing budget constraints on their development, however, it is certain that their urban areas will be free from slums and promote social good for its citizens.

These examples of town planning and poverty display the benefits of a positive relationship between these two social factors. Town planning done right can contribute significantly to the worldwide fight against poverty.

Monique Santoso
Photo: Flickr

Wastewater in India
India is not only one of the most populated countries in the world, but it is also one of the poorest. In addition to poverty, India is grappling with a lack of access to clean water and increasing pollution. This not only takes a toll on households but also affects industrial and agricultural demands. Urban runoff is an issue when domestic waste and untreated water go into storm drains, polluting lakes and rivers. Approximately only 30 percent of the wastewater in India is cleaned and filtered.

The U.S. Agency for International Development teamed up with a nongovernmental organization, Agra Municipal Corporation, to formulate a treatment plan to clean the wastewater in India.

What is Being Done?

North of the Taj Mahal runs the Yamuna River, one of the most polluted waterways in India. Agra, the city through which the river runs, is a slum community. As of 2009, this community has had no access to sanitation facilities, disposal systems or waste collection. At least 85 percent of the residents in Agra have resorted to open defecation that ultimately pollutes the Yamuna River, where residents collect drinking water. This lack of sanitation has left the community vulnerable to diseases such as cholera, dysentery, typhoid and polio.

USAID-supported NGO Center for Urban and Regional Excellence decided to reverse the state of Agra and come up with a treatment plan. In 2011, they built a wastewater treatment plant to clean the water, leading to healthier community members. Instead of chemicals, the treatment plant uses natural methods to sanitize the water. Moreover, they designed the plant to be low-maintenance, thus keeping it cost-efficient. After filtering and sanitizing the water, it flows back into the community for residents to collect.

As of 2017, the Agra Municipal Corporation, who initially teamed up with USAID, took over operating the plant. And they made it their mission to continue working to improve the lives of the residents.

The Progress

The Center for Urban and Regional Excellence’s transformation of Agra influenced the government to also act. As a result, the government planned to cleanse the entire country by the end of 2019. On Oct. 2, 2014, the Prime Minister of India declared the Swachh Bharat Mission. At the time, only 38.7 percent of the country was clean—less than half. As of 2019, India’s government reported 98.9 percent of the country is now clean. Since the mission began, they built 9,023,034,753 household toilets and established

  • 5,054,745 open defecation-free villages,
  • 4,468 open defecation-free villages in Namami Gange,
  • 613 open defecation-free districts, and
  • 29 open defecation-free states.

Less than 2 percent away from meeting their goal, India has made big improvements to better the lives of its citizens by providing clean water for domestic and industrial purposes.

Lari’onna Green
Photo: Flickr

Methods of Decreasing Maternal Deaths in IndiaIndia is one country out of many that are dealing with the problem of maternal deaths. More than half of these deaths occur due to an abundant amount of uncontrolled bleeding from mothers giving birth. Maternal deaths may be a huge issue when it comes to global poverty, but today there are methods for decreasing maternal deaths in India and other parts of the world.

Techniques for Decreasing Maternal Deaths

Research has shown that 5 to 10 percent of women giving birth will continue to bleed “more than normal” after their baby is born. There are different methods that impoverished countries, such as India, can apply to help fix this problem. One immediate way that can be performed as a form of help is to massage the womb of the birthing mother. The administration of affordable and accessible drugs, like oxytocin, can also solve the issue of the bleeding.

A recent technique that is being used for decreasing maternal deaths in India is the administration of the medicine tranexamic acid (TXA) that is simple to get and is very affordable. This medicine can help create a clot to prevent the continuation of bleeding through the development of a fibrous protein, fibrin, that joins platelets to form the clot. The intake of TXA can help prevent maternal deaths by 30 percent.

Research shows a single condom that is attached to a syringe, that is found in health facilities, can save the lives of 97 percent of women that are in shock from the bleeding. The way it works is by putting it into the womb where the mother is bleeding, and then water fills the tube. This single-use set can function as a tampon by pressing on the walls of the uterus to prevent the uncontrollable bleeding. Basic training can be completed so that a primary health care provider can even use this technique at a local health center.

If India adapts these techniques then in the next five years maternal deaths caused by bleeding can be minimized.

India’s Fight Against Global Poverty

Now that different researched methods are accessible to help lessen the number of maternal deaths in India, global poverty is the next question to be addressed. Once there are less maternal deaths in India then there will be less motherless children, and that will result in less homeless children on the streets. These methods will save mothers and families while fighting against global poverty. UNICEF India representative, Yasmin Ali Haque, recognizes the decrease of maternal deaths in India: “India has shown impressive progress in reducing maternal deaths, with nearly 1,000 fewer women now dying of pregnancy-related complications each month in India as compared to 2013.” Especially in Uttar Pradesh, part of India that had the highest decrease of maternal deaths, by a 30 percent.

In 2011-2013 there were 167 maternal deaths per 1,00,000 live births. Decreasing maternal deaths in India became more successful in the years 2014-2016, where there were 130 maternal deaths per 1,00,000 live births. This is positive progress as maternal mortality has decreased by an estimated 44 percent all around the world, from 1990 to 2015. India has the potential to decrease maternal deaths even more and diminish global poverty. The goal is to decrease the global maternal mortality ratio to less than 70 per 100,000 live births, following the Sustainable Development Goals between 2016 and 2030.

Maternal deaths make up a huge part of global poverty. Because impoverished countries do not have easy access to healthcare or enough health-care workers, they tend to have a higher amount of maternal deaths. The World Health Organization (WHO) set the goal of making sure countries all around the world reduce their maternal rates by supporting cheaper and better treatments. Therefore, India has made some significant progress in decreasing the number of maternal deaths and has the potential to reduce it even more through different researched methods. By doing so, India is one step closer to ending global poverty.

– Kelly Kipfer

Photo: Flickr

Mindfulness in Education Systems of IndiaIn recent years, India has improved its education system greatly. An increasing number of children have access to education and enrollment rates in primary school are on the rise. Over 98 percent of Indians have access to a primary school within one kilometer of their home. Yet, the nation still faces challenges with poor education and high dropout rates. In an effort to combat these challenges, India has introduced mindfulness in education systems across the country.

Education Challenges in Delhi

India is among the top five countries for children not attending primary school. There are over 1.4 million students between the ages of 6 and 11 not enrolled. Approximately 29 percent of children drop out of school before finishing the five years of primary school, and only 42 percent of students complete high school.

Many schools are not able to handle the needs of all the students. Only 74 percent of schools have drinking water and over 50 percent of schools have working restrooms for girls. Recent reports show that learning levels are not being reached, and standardized tests show that countless children will not progress in the school system. This highlights the need to improve the quality of education in India.

The Lasting Ramifications of Stress

Many students face external problems, such as poverty, that can seriously hinder their education. New Delhi slums have astounding illiteracy rates of 70 percent; however, the entirety of New Delhi has an impressive literacy rate of 86 percent. In the 2011 census, it was reported that 3.9 million residents of New Delhi live in slums. Non-government reports have estimated that the number of impoverished people living in the slums is much higher, sitting around 8 million. Residents of the slums lack access to adequate plumbing, drinkable water and transportation.

Children who are constantly exposed to poverty-related stress can have serious health consequences later in life. Physical reactions from stress, such as increased heart rates, stress hormones and adrenaline take a serious toll on a child’s health. Eventually, these children are at a higher risk of developing diabetes and other life-altering illnesses.

Over time, the structure of a child’s brain is forever altered. Cognitive functions are impaired, which can have disastrous consequences on a child’s emotional responses and attention span. Impoverished children are also at a higher risk of suffering from depression. In fact, one out of four children surveyed between the ages of 13 and 15 face the challenges of depression in India. In contrast, children who do not experience stress or depression experience healthier sleeping habits and are able to easily fight off illnesses due to having stronger immune systems.

Mindfulness in Education

India is combating stress-related illnesses and the inability to focus in class among children with an additional course in “Happiness.” The course objective is to improve the students’ emotional well-being through meditation, story-telling and other activities that focus on mental health. The students will learn mindfulness, empowering them to be less distracted and to improve their ability to focus. Apra, a primary school teacher, believes that mindfulness in education will help many students in Delhi. She adds that the course will specifically benefit children from poorer families as they will have “time to be happy.”

Mindfulness in education has shown encouraging results in urban schools. Created as an alternative to detention, Robert W. Coleman Elementary School in Baltimore has implemented an afterschool program dedicated to meditation and mindfulness. Success can be noted by the drop in suspensions at school. During the 2012-2013 school-year, 4 students were suspended. However, the following year there were no suspensions, something the school attributes to this program. Moreover, a study by Stanford University found that mindfulness in education has also helped lessen symptoms of PTSD.

Mindfulness in education is not the solution to end poverty, but it is a method that can be used to lessen the disastrous effects on impoverished children. Studies on mindfulness in education are still very new, but studies point in the direction that mindful practices will have tremendous results for students. Furthermore, the evidence shows that disadvantaged children will greatly benefit from this practice. For India, this could mean that retention rates in school will rise, and more children will be able to receive a quality education.

– Stefanie Babb

Photo: Flickr

Urbanization in India

India is a country in the midst of huge changes. As a developing nation with a GDP ranked 7th globally and a population of 1.3 billion people, India has seen a massive amount of improvements in recent years. However, as the nation’s population continues to expand, India suffers from overpopulation in metropolitan areas, a dynamic known as urbanization.

Urbanization in India affects the nation’s economy and quality of life, but most of all, this process harms poor individuals living in slums. Despite the negative aspects of urbanization, there are several non-governmental organizations in India providing relief and hope for those living in these areas of abject poverty.

The Facts

Slums in India commonly share the following characteristics:

  1. Lack of access to running water sanitation, adequate shelter, and medicine
  2. A poor population isolated by socioeconomic status and/or metropolitan developments that force slum residents into densely concentrated living conditions
  3. A high population growth rate, despite negative factors that decrease life expectancy
  4. A high percentage of young people, i.e. New Delhi where 47 percent of slum residents are under 15 years of age
  5. The presence of child labor; in India, 23 million children, ages 5-14, are believed to be active in the workforce illegally

The Reality of Urbanization

In India, urban slums are home to the poorest living in the cities. The abject poverty present in these locations gives little opportunity for individuals and families to improve their quality of life. Rapid growth in metropolitan areas tends to underutilize the amount of space available in a city, and slums are often isolated both financially and geographically from the progress being made across India.

Despite the low quality of life present in slums, the population of Indians living in slums continues to increase annually. This is due to the fact that many Indians are leaving rural villages to seek better paying jobs in larger cities. Every minute, 30 Indians move from a rural area to a city. However, those leaving rural areas often do not have financial freedom or the education that allows them to gain higher wages, leaving them no choice but to live in India’s many slums.

Those living in slums often find themselves facing religious persecution. In India, Muslims often face the brunt of this discrimination. They are denied housing or jobs because of their religious beliefs, offering little chance for them to leave the slums.

NGO’s Alleviating Urban Poverty

There are several non-governmental organizations across India seeking to alleviate the suffering of those living in urban slums.

  1. Asha: This organization provides medical training for women living in the slums of Delhi. These trained individuals can provide aid for their community members and watch over infants as well as the sick and elderly. Asha also funds medical facilities in slums, where residents can seek affordable treatment for their ailments. In addition, Asha cooperates with India’s Ministry of Finance in order to allow slum residents the ability to apply for low interest loans that help them improve their lives.
  2. Kriti Social Initiatives: This NGO helps to empower women by providing them with the opportunity to improve their lives and the lives of their family members. Working within five interconnected slums with over 4,000 households, Kriti has helped women find jobs and has provided scholarships to over 300 children in the Film Nagar area.
  3. Sammaan Foundation: The Sammaan Foundation campaigns to improve conditions for individuals working low-income jobs, mainly rickshaw drivers and street vendors in Kishanganj and the Araria districts of Bihar.

As the amount of Indians living in slums continues to rise, the effects of urbanization in India prove to be a challenge and a benefit for this developing nation. If the divide between the wealthy and poor can be diminished both socially and geographically, then the vast improvements taking place will be enjoyed by all Indians.

–  Jason Crosby

 
Photo: Flickr

India’s fight against PolioPolio, or poliomyelitis, is an infectious disease spread through poliovirus. Since the early twentieth century, polio has been widespread in many countries, causing paralysis in thousands of children every year. With the help of various nonprofit organizations and the Global Polio Eradication initiative, the disease is now narrowed down to a handful of nations.

In 2014, India was certified as a polio-free country, leaving Pakistan, Nigeria and Afghanistan on the list for polio eradication programs. India’s fight against polio is a remarkable achievement because of the various challenges the country faced. Nicole Deutsch, the head of polio operations for UNICEF in India, called it a “monumental milestone.”

Polio: Cause and Prevention

Poliovirus is highly contagious, infecting only humans and residing in the throat and intestine of the infected person. It spreads through feces and can contaminate food and water in unsanitary conditions.

The virus affects the brain and spinal cord of the infected person, causing paralysis which cannot be cured. Immunization through inactivated poliovirus vaccine and oral poliovirus vaccine are the only possible methods to fight against the virus. In the case of India, it was the second option which was administered.

India’s Fight Against Polio: the Challenges Faced

India’s fight against polio faced unique challenges, such as its huge population density and an increased birth rate. The number of people living in impoverished conditions with poor sanitation is huge, making them vulnerable to the polio disease.

Lack of education and prejudice among certain sects of the population also hindered the immunization process. Other challenges faced were the unstable healthcare system, which does not support people from all levels of society, and the geographically-dispersed inaccessible terrain, which made the immunization process difficult.

Overcoming these Challenges

Overcoming the challenges of polio eradication was possible due to the combined help provided by UNICEF, WHO, Rotary Club, the Indian government and millions of frontline workers. They took micro-planning strategies to address the challenges faced by the socially, economically, culturally and linguistically diverse country that is India.

India began its oral polio vaccine program in 1978 but it did not gain momentum until 1994, when the local government of New Delhi successfully conducted a mass immunization program for children in the region. From the year 1995, the government of India began organizing National Immunization Day, and in 1997, the first National Polio Surveillance Project was established.

Other initiatives taken include:

  • Involving almost 7,000 trained community mobilizers who went door-to-door, educating people in highly resistant regions.
  • Engaging 2.3 million vaccine administrators who immunized almost 172 million children.
  • The government running advertisements on print media, television and radio.
  • Enlisting famous Bollywood and sports celebrities to create awareness among common people.
  • Involving religious and community leaders in encouraging parents to vaccinate their children.

Inspiration for Other Countries

In 2009, almost 741 polio cases were reported in India, which dropped down to 42 in 2010, until the last case was reported in 2011 in the eastern state of West Bengal. This unprecedented success is an inspiration for countries like Pakistan, Afghanistan and Nigeria, where the disease is still looming at large.

India’s fight against polio has set an example in the world that the country can be proud of, but the fight is not over yet. Although India has been declared polio-free by the WHO, it is of the utmost importance that the nation continue to assist other nations still facing the polio epidemic.

– Mahua Mitra

Photo: Flickr

facts about poverty in India
India is a South Asian country with one of the fastest growing economies and yet still a large number of inhabitants living in poverty.

The Top 10 Facts About Poverty in India

  1. According to a survey done by CNN, only five percent of India’s surveyed population made enough to pay taxes, 2.5 percent owned a vehicle and less than 10 percent had a salaried job.
  2. With such economic struggles, literacy is extremely uncommon in rural areas. Only 3.5 percent of students in India graduate and about 35.7 percent of the population doesn’t know how to write or read.
  3. In 2012, there were 270,000,000 — or one in every five —  impoverished Indians; 80 percent of these poor Indians lived in rural areas.
  4. Twenty-one percent of poor Indians have restrooms, 61 percent have electricity and only 6 percent have tap water.
  5. With poverty affecting Indian lives so much, 38 of every 1,000 babies born in India die before making it to their one-year mark.
  6. The rapid population growth in India is one of the major reasons for poverty within the country. The growth of the population exceeds the rate of growth in the country’s overall income. This heavily affects the poor because population growth creates a need for an increased labor supply, which is a profession with low wage rates.
  7. One of the top 10 facts about poverty in India includes climatic conditions and the effect such impacts have on poverty within the country as a whole. India’s climate is extremely hot, which makes it difficult for Indians to work. This inability, in turn, causes production to suffer and therefore, the income of Indians to suffer as well. Also, there are numerous amounts of floods, earthquakes and cyclones that cause extreme damage to agriculture and infrastructure; all of these conditions make it difficult for people living in poverty.
  8. “Your Article Library” explains that low levels of investment create low income and that the circle of poverty is seemingly never-ending within India.
  9. Business Today explains that India recently accounted for the largest amount of people living below the poverty line; 30 percent of India’s population lives on less than $1.90 a day.
  10. The Huffington Post reveals that 56 percent of Indians (around 680 million people) lack the ability to meet their basic needs. Even the people who are officially above the poverty line (around 413 million people) are still vulnerable to such harsh conditions.

Sooner Rather than Later

With poverty continually taking such a toll on India, it is important to understand that it is a country in need of assistance. Allowing people the ability to see their harsh living conditions is one way to ensure that these top 10 facts about poverty in India improve over time.

– McCall Robinson

Photo: Pixabay

Behno StandardConsidering the work that millions of people do in factories around the world, progress is often valued not for the quality of the work but for how quickly the product can reach the market. If money is the primary objective, human beings can be endangered in the process. Without teamwork and employee wellbeing as priorities, products will not make it past production and the economic gains will not materialize. One solution to this culture is Shivam Punjya’s Behno Standard.

Punjya is a man who has sought to revolutionize the conditions in which factory workers operate, especially women. During a 2012 research trip on women’s health in India, he witnessed some extraordinary handmade textile work in rural villages. He was appalled to learn that 90 percent of these beautiful artworks were tailored by women who are paid less than $1 per day.

One year later, a tragedy would ultimately push him into advocacy. On April 13, 2013, the Rana Plaza garment factory in Bangladesh collapsed, killing more than 1,100 workers, the majority of whom were women. This incident brought intense awareness to factory conditions and the need to support workers.

Behno is a word used to describe love, harmony, and balance in its most beautiful connections with creative solutions. It is primarily an artistic expression used by communities full of like-minded individuals who strive for that harmony and balance with love. It is also the name used for the ethical fashion line that Punjya founded in New York.

Its central focus is on providing these factory workers with an environment to pursue their designs without their health being compromised. Through a partnership with a large nonprofit in rural Gujarat, India, called Muni Seva Ashram, Punjya began The Garment Worker Project. This was debuted in July 2016 as the first implementation of the Behno Standard through a collection of social programs.

The Behno Standard is broken into six categories: health, garment worker mobility, family planning, women’s rights, worker satisfaction and benefits and eco-consciousness. Its crucial emphasis is on offering a new meaning to the label ‘Made in India,’ often synonymous with unspeakable worker conditions. With the Behno Standard, Punjya strives to change that outlook and prove that a healthy working atmosphere leads to efficiency and high-quality products.

In Punjya’s own words, “Ethical fashion is such a collaborative space because the supply chain is massive and so convoluted. We encourage other brands to reach out to us, and we reach out all the time, to collaborate and utilize each others’ platforms.” Due to his inspiration for starting in the fashion business, he doesn’t want Behno to be a brand that tries to compete on the basis of profit. Instead, he wants his brand to be the unique type of team that collaborates with other companies.

Business doesn’t necessarily need to be a competition but can delve into a community goal. In that sense, the Behno Standard is transforming the connotations of factory work and joining together to revolutionize how the fashion business operates through human connections.

– Nicole Suárez

Photo: Wikimedia Commons

Slums
In 2001, 65 million people in India were living in slums without decent living conditions or any access to water and food on a daily basis. According to Berkeley research, more ore than 80 percent of the urban population in India cannot afford a concrete slab to be used as a roof.

For those who can afford a roof in slums, most of the time they are made of cement or metal sheets, which has a very bad effect on health and leads to poor quality of life. Witnessing such a lack of basic need, Hasit Ganatra, engineer and founder of ReMaterials, conceptualized a new type of roof named ModRoof to improve lives in slums.

According to ReMaterials, ModRoof is a “modular roofing system” that can improve shelters in slums and village homes in developing areas. Eco-friendly, easily removable and simple to install, it is also designed to be strong, waterproof and fire-resistant.

In addition, ModRoof is available for a low cost. Payable through microfinance companies, a very popular system in developing countries, the program solves the main obstacle to better facilities in worldwide slums: the price.

ReMaterials is currently considering embedding solar cells in ModRoof, which would allow houses to have power LED lights and outlets to charge phones. Employing solar power with ModRoof would be a huge step forward, as providing electricity to these shelters could assist in lifting the residents out of poverty.

“Worldwide experts told us to give up; they said we’d never do it,” said Ganatra in an interview with BBC. “But when you see this sort of problem [in the slums] you have to do something about it.”

Thus, the stark blue rooftop from ReMaterials is set to change lives. With continued persistence from Ganatra and his team, ModRoof will allow families living in slums all around the world to sleep in a safer, warmer environment.

– Léa Gorius

Photo: Flickr

Credit Access in IndiaThe evolution of credit has sanctioned simply the idea of money as an invisible but powerful force. In a place where poverty still affects 22 percent of the population, credit access in India is difficult for many of its people. Often, formal credit is as elusive for the people of India as its tangibility.

PMJDY and Financial Inclusion
Though financial inclusion has become a recent focus for policymakers, 40 percent of people still lack access to basic financial services. Financial inclusion is the basis of perpetual economic growth. “Without financial inclusion we cannot think of economic development because a large chunk of the total population remains outside the growth process,” said Dr. Harpreet Kaur and Kawal Nain Singh of Punjabi University and The Rayat Institute of Management.

Many low-income individuals have relied on informal, and sometimes devastating, options to borrow money or gain credit access in India. In response to this, formal options such as Pradhan Mantri Jan Dhan Yojana (PMJDY), a mega financial inclusion plan, was designed. PMJDY aims to ameliorate poverty and fast track financial growth. The program targets those from remote areas and promotes financial literacy, universal access to banking services and insurance. This is all to “commence the next revolution of growth and prosperity,” the plan explains.

Unfortunate Faults
More than a few studies have reported the same findings as Dr. Joy Deshmukh-Ranadive of the Human Development Resource Centre in New Delhi. In the doctor’s report on rural micro-finance in India, she explains that “the track record of these formal sources has not been positive. Micro-finance…circumvents the drawbacks of both formal and the informal systems of credit delivery.” These downsides include exploitative interest rates and fortifying systems of oppression.

Entrepreneurship in Rural India
The micro, small and medium enterprise sector (MSME) account for 37 percent of India’s GDP, and more than 40 percent of the country’s total exports, according to the World Bank. Despite this, MSMEs have been limited by inadequate access to financial services.

Fortunately, the International Finance Corporation devised a program called India Collateral. The program is modeled after a similar program that has had success in China. The project hopes to revise the discrepancy by opening access to banking services for more MSMEs by increasing lenders’ confidence.

While there are programs formulated to improve access to credit in India, there remains a gender bias. Though loan rejection and approval are issued at an equal rate to both men and women, women tend to seek financial services less often. Higher gender bias countries like India see more women deferring from the loan process, according to a report by the European Central Bank.

It is an interesting paradox: those who have money are those who typically qualify to borrow it. The necessary condition for credit access is already established finances. Those who stand to benefit the most from borrowed money are those who do not have it. Steps toward financial inclusion in India are governed by this idea. Many programs continue to amend credit access in India, develop the informal credit market and lower interest rates in the hopes of developing the country’s economy from the bottom up.

– Sloan Bousselaire

Photo: Flickr