An innovative private sector for poverty reduction

Poverty, considered a curse, declined in Bangladesh at a faster pace, by nearly 19 per cent over the last two decades. But it still continues to dominate the life and living in this country. About 32 per cent of its 150 million people live below the poverty line and a sizeable part of them are hardcore poor. The increased level of spending on the public sector development activities, the expanding and important role being played by the private sector in the economy and the programmes of the non-governmental organisations (NGOs) at the grassroots to empower the poor economically have been considered to be the major reasons for whatever decline in poverty Bangladesh experienced in the last twenty years. However, getting rid of poverty or lowering its rate to the minimum within a reasonable time would, obviously, would involve a Herculean task. This task will require most innovation, devotion and sincerity for its accomplishment. There is no denying the government remains one of the key players in an economy like that of Bangladesh. But the private sector since the start of the process of deregulation of the economy more than two and a half decades back has grown in size and emerged as the main engine of growth. So, poverty cannot be either banished or reduced to a negligible level without the active participation of the private sector. However, the contribution of the private sector to poverty reduction is already well-recognised as privately-owned mills and factories and service industries and establishments now employ the bulk of the country's workforce. A shining example of the contribution of the private sector to poverty reduction is the readymade garments industry that employs more than 3.0 million people, directly and indirectly, and 90 per cent of them are women. There are other private industries and establishments that also have their contributions, big and small. But such employment opportunities as the means for reduction of poverty, force the poor to leave their village homes and crowd the urban centres, a development considered very unhealthy. So, the solution to the problem of widespread poverty, particularly in rural areas, needs to be based on innovative ideas about, not on the traditional ways of, addressing the issue. With such objectives in mind, the Swiss Agency for Development and Cooperation and Swisscontact late last week organized a knowledge-sharing event in Dhaka where leaders of some multinational and local private firms discussed how innovative business ideas, inclusive marketing approach and use of the information and communication technology (ICT) at the grassroots would help reduce poverty. The mobile phone has already penetrated deep into the villages, ensuring some positive changes in the rural life. But what is important to effect a speedier poverty reduction is the creation of more rural employment opportunities through greater economic activities there. This is the area where innovation on the part of the private sector should come into play. Already, some agro-marketing companies have made their mark in rural economic activities, leading to creation of jobs for the poor. But compared to the vastness of the problem of unemployment, their contribution has been very limited. There is a lot of scope for the private sector to play a far greater role in rural areas and contribute to poverty reduction by employing innovative business ideas and ensuring better healthcare, food and digital technology to the hardcore poor. The private sector, however, is not expected to make the move unless a fair amount of profit is guaranteed. Here the NGOs can play an important part. A part of the resources that the NGOs employ at the grassroots can be used for supporting the innovative ideas of the private sector, if there are any, to lift the poor economically.