[Telecentres] Bruce Alberts on science and development

[Subbiah Arunachalam]

Friends:

Here is an excerpt from the 141st Presidential address given by Prof. Bruce Alberts to the Fellows of the US National Academy of Sciences (19 April 2004). I hold Prof. Alberts in high regard. Not only is he an outstanding life scientist, but he has an insightful understanding of the science-development interface and he is genuinely concerned about the problems faced by developing countries. 

The full text is available on the NAS website. I wish the editors of The Economist read it.

Happy reading.

Arun
[Subbiah Arunachalam]


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The challenge of bottom-up development

In the United States, we often talk about economic development as a top-down phenomenon. In this model, a person or a corporation with resources will establish a business enterprise and hire employees. Later, some of these employees will accumulate enough resources themselves to start their own businesses; these in turn will create more employment and greater wealth in the community, and so on.

This model may apply to nations like ours. But it is totally inadequate to meet the current needs of a nation like India, where 70 percent of the population live in rural villages, with limited opportunities for education and non-agricultural employment. For other jobs, they are forced to move to cities and often must live in expanding urban slums.

Most of the world resembles India, but India has the advantage of having a strong scientific and technical capacity despite its extensive poverty. It is also a very large and diverse nation that provides a fertile test bed for new ideas. If our Academy wants to make a strong contribution to sustainable development through science and technology, it is in nations like India that we should search for models, not in nations like ours.

Many interesting experiments are in progress around the world, and I have been attempting to follow some of them to see what can be learned about effective strategies for attaining the vision elaborated in Our Common Journey. This past January, my wife Betty and I made our third visit to the villages of Pondicherry, India, where a non-governmental organization (NGO) founded by our foreign associate M.S. Swaminathan has been deeply engaged in a variety of science-based experiments in rural development (see <www.mssrf.org>).

On previous trips, we had visited the information kiosks in these villages, which connect the otherwise isolated villagers to a wireless Internet service in their local language that provides them with daily market prices, and weather, health, and agriculture information. We had also followed the development of several science-based enterprises-in which, for example, a small group of landless villagers produces mushrooms or milk for sale.

At the end of each of our earlier visits, Betty and I were left with the feeling that the problem of both long-term sustainability and scale were overwhelming. Perhaps this highly dedicated and uniquely skilled NGO could, with the support of various donors, ultimately affect 20 or 40 villages, with a total population of 100,000 people. But what would happen when its leadership changed, or when the current donors decided to move on to other projects? And, most important, what about the remaining 700 million Indians who live in similar situations elsewhere? The challenge seemed overwhelming and the whole enterprise fragile.

Bring in the bankers

I was surprised to encounter a completely new element in our last visit. The State Bank of India is now intimately involved as a partner with the M.S. Swaminathan Research Foundation in each of the village projects that we helped to inaugurate. Some of the projects were dairies, as before, but other groups of villagers had set up small production plants for biocontrol agents.

In this example, a group of villagers had established a factory to produce the small parasitic wasp, Trichogramma, which deposits its eggs on those of larger insects and destroys them. Some of their product is being used in their own village to replace pesticides and increase plant yields - thus bringing both health and economic benefits. The remaining product is being sold in the market to generate income. And the women involved had begun to train new groups in neighboring villages. Here was a perfect example of the type of science-based franchise for sustainable development that I had been seeking.

The State Bank funded the equipment and supplies needed by each of the groups through loans, and it was our privilege to hand out the checks, some for more than $5,000. The interest rates charged are generally about 20 percent per year, which is much less than the rates of the traditional moneylenders, who may demand 10 percent per month or more.

Is this a public service activity, subsidized by the government? To my surprise I learned that the answer is no. These cooperatively held loans are being made to so-called "Self-Help Groups" - each composed of 10 to 20 villagers who had learned to work together. They are among the bank's best-performing customers, with 95 percent of repayments being made on time.

Through 700,000 Self-Help Groups, about 70 million people have thus far been helped with bank credit in India, with an average loan per group of about $700. About 90 percent of these groups consist only of women. According to the general manager of the Central Bank of India, these loans are "meant to deliver women from socioeconomic oppression, and empower them through monetary security."

The bottom-up development generated by loans to cooperative groups of the rural poor is a major movement encouraged by the Indian government. It is being stimulated, guided, and monitored by India's National Bank for Agriculture and Rural Development, whose Web site <www.nabard.org> provides guidance on the establishment and evaluation of Self-Help Groups, as well as many other informative details. We need only think back to Jimmy Stewart's role as George Bailey in the 1946 movie It's a Wonderful Life - still a holiday classic - to remind ourselves of the important role that the credit provided to ordinary Americans by local banks has had on our own nation's development.

Experiments in Africa

As this example demonstrates, those of us in the United States who have been struggling to find productive ways to link science to sustainability goals have much to learn from experiments in other nations. Another foreign associate of our Academy, Akin Mabogunje, an urban geographer from Nigeria, has played a major role in creating two other prototype examples.

As Dr. Mabogunje recognized, because the low-income workers and craftspeople in Nigeria have no collateral to offer, they lack access to the credit that they need to expand their small businesses. This led to his formation of the first Nigerian "community bank" in 1990, as well as to the establishment of a National Board for Community Banks that he initially headed. A community bank is a local institution, where one's honor and social standing in the community are the key to obtaining a loan. As in the case of the Indian Self-Help Groups, peer pressure takes the place of collateral in insuring that the loans are repaid. Today there are nearly a thousand community banks in Nigeria.

Through an NGO that Dr. Mabogunje started, he has recently helped to catalyze an experiment in sustainable development in the city of Ijebu-Ode. This is a region of about 200,000 inhabitants where 90 percent of the people live below the international poverty line, earning less than one dollar per day. The experiment began with what we would call a "knowledge assessment" (see <books.nap.edu/catalog/9528.html>). First a report was prepared listing the prime opportunities for job creation in Ijebu-Ode, along with the main actors in the socioeconomic life and governance of the city. This led to an extensive city consultation process involving many diverse groups. As a main outcome, a set of strategically selected worker cooperatives were either engaged or formed. Credit was then extended to each of them for enterprise development.

Pictured here are some of the members of a beekeepers' cooperative, along with both Dr. Mabogunje and Academy member Robert Kates. Some of the other cooperatives being supported in the city are focused on aquaculture, on women who run local markets, and on cassava production and processing.

Even though no collateral was used to secure these loans, the experiment appears to be a success. The loans are being repaid, and much useful economic activity has been stimulated. It therefore would appear that, with strong preparation and planning, the provision of unsecured credit for cooperative enterprise development can work on different continents, and in both urban and rural settings.

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