Ngos Doubt Donor Agencies Intentions

Fears about a hidden agenda came through during the two-day pre-summit consultations among the representatives of non-government organisations (NGOs), international donor agencies, banks, financial institutions and the government that ended yesterday.

The apprehension stems from the draft declaration which NGOs feel has not addressed the concerns of the Third World adequately.

NGOs from the Third World need to make the summits declaration relevant to credit delivery system at the ground level in poor areas.

The summit is being organised on the initiative of leading non-government organisations like Womens World Banking, Accion, Sewa of Ahmedabad and the Grameen Bank of Bangladesh. It is being supported by the World Bank, the UNDP and Unicef.

 

The summit plans to bring together a variety of agencies to raise $21.6 billion to provide credit to the poorest 100 million people by the year 2005.

Of this, $10 billion will be raised at market rates, $4 billion at concessional rates and $7.6 billion will be grants.

The consultations were organised jointly by Actionaid India and Sharan.

The delegates said the summits draft declaration had missed, among others, the following points:

Microcredit is a total package of services to uplift living standards.

An element of interest rate subsidy needs to be built in to enable the poor to access credit and encourage non-government org-anisations .

Women should not be seen as soft targets because of the high rate of loan recovery among them. Their need should br reflected in the declaration.

A global effort such as the summit might result in standardising the flow of credit to the poor and kill the initiatives taken at the ground level.

Actionaid India executive director Amitava Mukherjee said it was necessary that banks, government agencies and the private corporate sector came forward to support initiatives of the poor.

Indian Micro Enterprises Development Foundation chairman Vijay Pande pleaded for a drastic change in the regulatory mechanism under which the Reserve Bank did little to foster the growth of microcredit institutions.

He suggested amendment to the Income Tax Act to give microcredit institutions the same tax advantages as the infrastructure sector and amendment to the Foreign Contribution (Regu-lation) Act to encourage the inflow of foreign capital.

Nandini Azad of Working Womens Forum said the critical issue was not credit, but social mobilisation without which credit could be frittered away in wasteful expenditure while the hunger for credit could result in the rise of money lenders.