[GJM] On the usurious enterprise of Grameen Bank

[Muhammad Mukhtar Alam]

  More on Dr Yunus's Nobel Prize and Related Issues
  Taj Hashmi
  
  Dear Friends:
  
  I have mixed feelings about Dr Yunus's getting this
  most prestigious award. On the one hand I am happy for
  him, rather happier for my country. At least more than
  a billion people globally read, watched and heard this
  image-boosting news. And I know, the average people do
  not know or care to know how a particular physicist,
  chemist, medical-researcher / physician, economist,
  writer and peacemaker got the Nobel. How many Indians
  can precisely tell as to why the great Amartya Sen got
  the prize is a billion dollar question. In this token,
  Dr Yunus's prize matters most to the bulk of the
  people in Bangladesh and abroad, NOT what fetched this
  prize. 
  
  I have no problem with that. I also personally believe
  as I personally know Prof Yunus since our Chittagong
  University days as colleagues since 1972 that he is
  not the type who would make money by his project. So
  where is the problem that I am dead against NGOs and
  micro-credit?
  
  I was a BIG admirer of Grameen Bank up to 1996. After
  undertaking my book project to work on women and Islam
  in Bangladesh in early 1996, I spent a few months in
  Bangladeshi villages doing field work, examining the
  impact of NGOs (mainly Grameen and BRAC) on the poor
  villagers, especially women. I also looked into the
  problem of the ongoing confrontation between NGOs and
  village mullahs. I interviewed a cross section of the
  population, reviewed literature, both pro- and
  anti-Grameen (there are tons of anti-Grameen
  literature, both in print and web). And by early 1997
  I was a changed man.
  
  Later in 2001 and early 2002 I spent two months in
  villages in Comilla, Sylhet and Dhaka districts, with
  my students as their supervisor (anthropology and
  ethnography). My students without my prompting all
  told me that they found non-Grameen villagers were
  much better off than those taken Grameen loans. Some
  villagers proudly asserted: "Sir ( unfortunately, a
  very common expression in Bangladesh on part of the
  poorer sections while addressing urban educated
  people), we did not allow the Grameen to open its
  branch in our village. And as a result, we are much
  better off than some neighbouring villagers, (who are
  indebted to Grameen) by the grace of Allah."
  
  Most unfortunately, contrary to what Dr Yunus has been
  telling us, the poorest of the poor simply do not /
  cannot get Grameen loan as they simply cannot service
  any loan at 30%, payable in 52 instalments in one
  year. There is no remission, exemptions or leniency.
  Defaulters part with tinsheds, utensils, goat and
  cattle. This came out in so many newspapers in
  Bangladesh and researchers (even admirers of Grameen)
  found out on the field.
  
  So, the Grameen borrowers are mainly middle peasants,
  who had access to micro credit throlughout our
  history. Even the wretched Kabuli (actually Pathan)
  money lenders in Bengal during the British period used
  to advance micro credit, collateral free, at 24%
  interest., None of those money lenders ever got any
  appreciations from us. Those money lenders rendered
  tremendous service to the poor during their crisis
  period -- on the eve of their children's wedding or
  when they were on the verge of starvation during a bad
  harvest, floods or drought.
  
  Do you know that Rabindra Nath Tagore started a
  beautiful rural banking system in the 1930s at a
  village called Patishar in Naogaon district (not far
  from Hasan Mahmud's ancestral home). Tagore's bank,
  called Patishar Bank is almost an exact replica of Dr
  Yunus's Grameen Bank (which Dr Yunus never
  acknowledged). But the beauty of Tagore's bank was
  that it charged NO INTEREST from the borrowers. Did
  Tagore deserve another Nobel Prize for this noble
  gesture at the fag end of his life?
  
  In sum, I do agree with the view that Dr Yunus has a
  vision and Bangladesh should celebrate this award, but
  Dr Yunus has failed to understand the implications of
  importing Monsanto seeds into Bangladesh, giving
  tax-free privilege to a Norwegian telephone company to
  rip off Bangladesh and the evil design of the IMF and
  World bank, who never ever did anything goof for the
  Third World. They have an agenda, which Dr Yunus
  failed to understand or ignored.
  
  Do you think that it is fair to charge around 28
  to30% interest from the "target group" or the poor
  borrowers (the poorest don't get the loan, at all),
  while the Grameen Bank gets that capital from Western
  donors interest free or at 2% interest? Do you think
  Grameen Phone should have paid due income tax to the
  Bangladesh Government? Do you think NGOs, not good
  governance, can alleviate and eradicate poverty? I
  finish by citing Lee Kuan Yew, the father of modern
  Singapore. He wrote and said in public that had
  Singapore listened to the IMF and World Bank, by the
  1990s Singapore would at best have been at the stage
  of Sri Lanka in terms of development. Similarly
  Bangladesh, taking Lee Kuan Yew and Jawaharlal Nehru,
  the great visionaries of our time as inspirers, should
  come out of the dictates of donor agencies, including
  the IMF and World Bank. My opposition to this Nobel
  Peace Prize to Dr Yunus and Grameen Bank has only one
  objective: Bangladesh should not let loose the demon
  of micro-credit and NGO business, at the cost of its
  long-term interest. You would be surprised to learn
  that how exploitative the mega NGOs like BRAC and
  PROSHIKA could be for the average bangladeshis. How
  many of you know that a Nakshi Kathar Sari you buy at
  Taka 12,000+ at Aarong shops, run by the BRAC, is a
  by-product of slave labour. The BRAC not only pays NO
  income tax (as charity, has occupied parts of Gulshan
  Lake to build its multi-storied complex , people
  allege, I am not sure) ,it also pays around Taka 500
  to the village woman who makes the embroidery on the
  Nakshi Katha Sari. And it takes her about a month to
  complete one sari. Is it fair? Similarly is it fair to
  promote money lending by Grameen borrowers? They
  borrow at 30% and invest that in local money-lending
  business charging 100% or more on short-term loans.
  So, while the Nobel Prize is a good news, the story
  behind the Prize is not so. Finally, while Gandhi
  never go the Nobel Peace Prize (he deserved it most in
  South Asia), Menachem Begin, Anwar Sadat, Yasser
  Arafat and a former South Korean Prsident in 2000(the
  name slipped off my memory) got this prize for
  bringing about PEACE in the Middle East and the Korean
  peninsula! Where is the peace in these regions, could
  you please tell me?
  
  Warm wishes and kind regards to all.
  Taj Hashmi [taj_hashmi at hotmail.com]
  
  
   
   
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  Views expressed here are solely those of the contributor(s) and does not necessarily reflect policies of the PNCC.
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