He played a leading role in the Bengali nationalist movement in the 1960s, and authored the Two Economies Theory and drafted the Six Point Demands of nationalists that became the basis for the struggle for autonomy of East Pakistan. Having served in the first Planning Commission in Bangladesh and being a close associate of Bangladesh’s founding leader Sheikh Mujibur Rahman, Professor Rehman Sobhan has served in several advisory councils and commissions of the Government of Bangladesh. Sobhan is currently the chairman of the Centre for Policy Dialogue, Dhaka. In his latest book, Challenging the Injustice of poverty: Agendas for Inclusive Development in South Asia, he explores issues related to poverty in a two-pronged manner: by focusing on injustice created and perpetuated by the unjust nature of a social order as its source and by providing concrete suggestions about how policy makers may move to challenge these injustices. Sobhan’s cohorts at Cambridge included prominent Indian economists such as Amartya Sen and Manmohan Singh; so how does he rate these stalwarts ? ?Personally I am more closer to Sen, he was a year senior to me. Singh was a year junior to me, very quiet and reserved. I have been interacting with him. Today, he is the Prime Minister of India, but he had no such expectation, as he was a very non-political person. But he is a person of enormous competence and integrity and is essentially a government policy maker. Singh is much more pragmatic in a lot many ways, as being a policy maker you become more aware of problems in running a government and implementing policies. He eventually evolved into a more market-oriented person, but remains someone who believes that through this process he can create a more inclusive society.? Sobhan tells Sarika Malhotra how policy makers, political activists and civil society advocacy groups can build a just, inclusive and poverty-free south Asia. Excerpts:
You mention the role played by south Asia’s fragile democracies in the way south Asia is. How do you place India vis-a-vis other countries in this respect?
India has been very fortunate in the way it has managed at least to sustain the institutions of democracy in the past 60 years, barring a few hiccups. In all other countries, there have been more serious problems, Bangladesh has had long episodes of military intervention, then the generals take off their uniforms and become civilian presidents and this holds true for Pakistan also. But certainly, the urge for having democratic institutions remains strong and people recognise that military rule is certainly no solution. It is democracy that people aspire for. And they are uncomfortable with the military rule in the region. In fact, the problem with military rule is that they are not representative and accountable. For a period of time they might do some good things, but because of their lack of accountability, they lapse into both corruption and arbitrary rule and after a while there are movements to overthrow them. It?s like a cycle, and in some countries like Nepal, Bangladesh, Pakistan, they keep going back to civilian rule.
But even where there is democracy, there has been unrest and dissatisfaction with governments?
Yes, the big problem for south Asia has been that even when you have functioning democracies, including in India, they are not always representing the concerns of the poor. And this is measured by the fact that the election game requires money, people with money, people with political influence, people who can manage electorate, tend to make it into a elite-oriented political process. So the big problem with south Asian democracies has been that they have gone through the forms of democracy, but it has not been inclusive to represent millions of people who have voted for them and are getting very little out of the democratic process. One of the consequences of this has been that a large number of people do not feel adequately represented. If you give them a chance, they regularly vote out governments, so their reflection on the working of the system is representing the fact that in country after country, wherever there is a relatively free exercise of the vote, it results into a change in government. Whatever government comes to power, it still has to respond to the needs of the people. When democracy comes under threat, you cannot mobilise people to come out and defend democracy because they have not got a great deal out of democracy. At the end of the day, if you can mobilise millions of people who have become stakeholders in whatever democracy is offering them, they will not come out to defend democracy. This is the great tension that exists in our society.
In the preface you mention how poverty and inequality compromise the character of our institutions of government, but what do you have to say about corruption in the high ranks of government and bureaucracy in south Asia?
Since poor people are inadequately represented where power is exercised, the bureaucracy treats them with contempt, and it only serves them by taking money. And where you have no money, you tend to be victimised by the institutions of government. So people fear law enforcement agencies because they extort money from them. If you go to them with a case and you have nothing to give them, they will probably not even respond to you. Corruption has become a reflection of the institutions of governance that have been captured by the elite who are willing to spend money to control them. And there is an unholy nexus between the administration, the law enforcement agencies and political players to use the resources of the state for their benefit.
Corruption is a form of manipulating the state through the exercise of power and money and use it to get benefits for self. In this process, the poor tend to be victimised, as they do not have any power, resources; they only assert themselves in elections and periodically get violent. And, in particular cases, they even pick up arms and express their dissatisfaction with the system in the most extreme way.
India has particularly grappled with the Naxal problem in 2010. How do view this upsurge in the Naxal movement in India?
Naxal movement in India has been around for a long time. In the first phase of Naxalbari, in the late ?60s and ?70s, India went through a strong Naxalist upsurge and periodically there have been episodes of violence and constantly people have been mobilising to protest. People feel that they have not been treated justly. In those days, level of development was lower and opportunities were fewer and response came because of a growing sense of deprivation. Independence had promised that it would change their lives. Now, 30 ? 40 years have gone by and people have not got their due. In south Asia, it is a common phenomenon. For example, in Pakistan, the rise of the fundamentalist is a form of dissatisfaction with the state and the feeling that westernised elite have captured the state. And when the military tries to manipulate the fundamentalists, which it has done periodically to stay in power and meet their own ends, then it turns against them.
In this backdrop, where has policy gone wrong?
Policy has created severe inequalities.
Has it been intentional on the part of the state?
Yes. It has been a conscious notion that the best way to get development is by concentrating resources with the business classes who will bring investment and modernisation. And it?s not that business has not delivered some level of development, but one of the consequence of this strategy has been severe inequalities and the emergence of a super-rich class who tend to use their wealth to further accumulate power, wealth and influence. This has happened in country after country in south Asia. What is perhaps unintentional is that this would lead to such adverse consequences for the poor, because this theory is dependent on the trickle-down theory of development. Accordingly, you invest resources in a an efficient entrepreneurial class who will give you investment and growth, and as investment and growth happens, it trickles downs and creates job s for the people and creates opportunities for the poor to participate in the labour market. But what really happens in practice is that we have almost 50% of our population living in extreme poverty and even those who are above the poverty line are in an fairly fragile condition and can move easily below the poverty line.
You talk about structural dimensions of poverty; what should be the best way to tackle these?
Structural dimensions denote the big inequalities that exist in opportunity. This means no land, no access to assets, very little opportunity of becoming shareholders in the enterprises. If you are a poor farmer, you will sell your product at the lowest price to a series of intermediaries who make all the profits in the value addition process. The idea is to correct these structural aspects, give people assets, give an educational system that does not just give basic primary schooling of an incompetent nature, provide quality health care. So you have to intervene in the system to bring about structural change. No country is attempting to look at the sources of poverty. What policy makers accept is that there are a large number of poor people, and for them they have a whole variety of welfare programmes, known as social provisioning, such as subsidies, work creating programmes. These are all ways by which you spend government money in order to transfer some resources to the poor, but what the poor really want are opportunities to really get the same benefits from the economy that people living in cities have with comfortable lifestyle. We have to understand that these elite people have not become like this merely because they are enterprising, they have become rich because the system has created a whole set of opportunities for them. South Asian governments should work around eliminating the sources of poverty.
Where has the Indian microfinance model gone wrong?
Microfinance has played a very useful role. In India it has got its own flavour. Banks are lending to self-help groups. Now it has become more commercialised. The problem with microfinance is that it only relieves poverty, it?s not a permanent solution to poverty. When a business venture comes along, your primary objective is to make profits for yourself and your shareholders and wherever there is a crisis, you are not in a position to respond to them because your motivation is not to transform their lives, your motive is to make profits and then you tend to victimise borrowers if they cannot repay.
The model has been viable financially, but it has to be sensitive. And that is where it is important that the original motivation of the venture is taken into account.
