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Published in The Guardian on July 11, 2011.

In 2003, the UK’s Department for International Development (DfID) awarded Nick Hughes of Vodafone nearly £1m to develop an innovative mobile banking solution for Kenya’s “unbanked” population. Within four years, Vodafone and Safaricom, the country’s largest mobile operator, jointly launched a programme called M-PESA. The concept was simple: instead of setting up bank accounts or traveling long distances to transfer money, M-PESA would allow users to do it using their mobile phones.

M-PESA’s take-up rate was unprecedented. Within two years, more than 20% of Kenya’s population was registered for the service, and the scheme accounted for nearly a third of Safaricom’s £150m profits. Today, DfID officials admit they “widely quote, perhaps even overquote” M-PESA as a shining example of how the private sector can make lasting change in international development.

In May this year, DfID decided to build on M-PESA’s success by formally announcing a new focus on the private sector. In a report, they wrote that they will be devoting significant resources to “stimulat[ing] private investment” and “transform[ing] the business environment” across the developing world, with the ultimate goal of reducing poverty. Specifically, DfID will support the private sector to provide financial services, schooling, sanitation and other basic services in the 27 developing countries in which it works.

“We start from a position that says business doing business is making a contribution to society,” Karen Johnson, private sector adviser at DfID, told me. She and the report’s authors believe the private sector can create new employment opportunities and develop necessary goods for poor people across the developing world. It can also innovate quickly and do things “more efficiently” than other sectors.

DfID’s optimism about the private sector seems absolute, almost unwavering. However, is it entirely warranted? Is the private sector really the most reliable player for supporting DfID’s development targets, perhaps more than government or non-governmental actors? Will investing in the private sector unambiguously help people in the developing world to see lasting reductions in poverty levels?

The report makes only a slight nod to the potential risks of working with the private sector. It acknowledges in theory that private companies can “behave badly” or even “ignore the marginalised” – but does not detail the ways in which this can potentially occur. DfID says almost nothing, for example, about how private companies can create inhumane working conditions, harm the environment, or price goods out of the reach of poor consumers.

More fundamentally, DfID fails to mention how the private sector is not accountable to the public in the way the public sector is (at least in countries with a democratically elected government). In the “shining city” of Gurgaon, India, for instance, where the public sector has given much of its authority to private developers, the poor have been largely underserved. Sanitation and water systems are often not available for poor citizens – and private developers cannot be held legally accountable for not offering them.

Gurgaon is an extreme example, but most businesses will at some point make decisions that do not entirely fit with DfID’s lofty international development goals. After all, private companies are answerable not to the general public but to their stakeholders. If, for instance, M-PESA decided to double its prices one day, the public would have little say in the decision – although they would be the ones most harmed by it.

Gavin McGillivray, head of DfID’s private sector department, disagrees that the private sector is uniquely unaccountable to the public. “Limited accountability is something we encounter constantly,” he told me. “NGOs aren’t accountable to taxpayers, and there are many countries where governments, even democratic ones, aren’t really accountable to the public.” Given this reality, he continued, DfID is just ensuring that its money is being used to deliver “real outcomes”.

Underpinning this attitude is a belief that governments have largely failed citizens in the developing world. “We have to realise that governments in most developing countries have done a miserable job in providing basic services for citizens,” McGillivray said. “We suspect that the development community as a whole hasn’t looked hard enough at non-state provision of services.”

McGillivray’s comments are quite bold given that developing countries were very much forced to look at “non-state provision of services” in the 1980s when the World Bank and the IMF introduced its structural adjustment programme, which actually reversed development progress in some countries.

An example of what DfID might invest in would be a private sector-led water project that provides safe water to ill-served communities. In the report, they give the example of Maji Ni Maisha, a community-based water finance scheme in Kenya. However, they do not mention how, if at all, DfID would ensure the poorest of the poor could afford this water, nor how they would ensure water is equitably distributed. An equivalent public option, while potentially imperfect in many ways, would be responsible for this much.

The private sector certainly has the potential to raise incomes and living standards of people across the developing world. But it also has the ability to exclude many from the benefits of economic growth. In this new approach, DfID must think critically about where the benefits of private sector involvement in international development might be outweighed by its costs.

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Published in The Guardian on June 6, 2010. Read the article here or below

The rejection of sex education by parliament has left Indians relying on a newspaper column for advice on basic biology

Can oral sex lead to pregnancy? Will daily masturbation make me go bald? If my elbow brushes against a woman’s breasts on a bus, will I be at risk from HIV?

These are not questions being asked by innocent pre-teens in a middle-school playground. Rather, they are being posed – and answered – in India’s most widely circulated English-language newspaper. The “Ask the Sexpert” column runs in a daily supplement of the Times of India, with spinoff columns beginning to appear in other major Indian periodicals.

It essentially features sex-related questions from across India, followed by small nuggets of advice. The queries range from the serious to the clueless, from the sympathy-evoking to the unintentionally entertaining. (Some choice, if rather explicit, examples can be seen here, here and here.

To a first-time reader, particularly one with a functional understanding of the birds and the bees, many questions will seem unbelievably basic. How can a society, especially one with a strong cultural emphasis on education, be so ignorant of elementary biology? To put it bluntly, why are so many Indian adults confused about where babies come from?

First-time readers will be further surprised to learn that author, Dr Mahinder Watsa, is an 85-year-old gynaecologist and sex counsellor. Unlike many Indian octogenarians, however, Watsa does not spend his time decrying the decline of family values. Rather, he appears to have largely accepted – and arguably immersed himself in – the concerns and realities of today’s youth.

Ask the Sexpert is far from prudish. Though occasionally antiquated, Watsa’s advice is – for the most part – factual, terse, and at times even sardonic. He regularly calls men “old-fashioned” for seeking brides with intact hymens, and often tells size-obsessed men to simply “learn the art of love-making”. Homosexuality seems to be Watsa’s only taboo topic; all else is fair game.

His column provides a sharp contrast to candy-coated Bollywood cinema, and to Indian society overall. It unabashedly discusses topics that are otherwise brushed under carpets, and boldly uses phrases that are usually only whispered in shy giggles. Most importantly, it does what Indian sex education has clearly failed to do. Indian schools are, by a long stretch, less open about sex than Watsa’s column. While Ask the Sexpert discusses premature ejaculation and G-spots at length, the Indian educational system offers students unsubstantial lessons on human anatomy.

This is, in part, because of a parliamentary ruling that rejected the introduction of proper sex education in schools. Sex education has no place in India’s “social and cultural ethos”, the committee argued, and school children should simply be taught that “sex before marriage … is immoral, unethical and unhealthy”.

Some observers believe that committee members are afraid of sex education leading to “people having sex on every corner”. Never mind that scientific studies around the world have found sex education to both delay the onset of sexual behaviour and to increase likelihood of safe sex. Until the Indian education system recognises its shortcomings, the Indian public will have few options but to continue to “ask the sexpert”.


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Published in The Guardian on May 19, 2010.  Click here or read below:

There are many ways to define poverty, but we shouldn’t allow the debate to distract us from helping the poor

I recently had the pleasure of meeting a construction worker named Lakshmi while taking a walk in Mumbai. She was on a much-needed break, and I was feeling chattier than usual. Lakshmi told me that she moved to Mumbai 10 years ago with her husband, and that they gave birth to two lovely children before he died last year. When he died, she could no longer afford rent for their single-room flat, and was soon after evicted. Today, she and her children live under a blue tarp tent with patchy electricity, no running water and few physical assets to their name. She earns Rs 120 (£1.80) every day she works at the construction site. Most of her wages are used to purchase groceries, with which she usually cooks thin rotis and watery lentils.

Is Lakshmi’s family poor?

According to the government of India, she is not. Since her income is technically sufficient to provide her family three meals a day, her household is above the nationally defined poverty line.

To Lakshmi, this means a lot.

Below poverty line households are issued distinctive cards with which they can acquire heavily subsidised rice, wheat, sugar and paraffin. Her family is instead classified as “above poverty line”, which allows them fewer subsidies. Needless to say, additional handouts would help Lakshmi tremendously.

Lakshmi’s plight speaks to a larger issue, one that has plagued policymakers for years. How should a country define a reasonable poverty line? How should it decide who is truly downtrodden and hence deserving of government handouts? (more…)

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India’s pirates of microfinance

Micro-moneylenders who profit from borrowers in southern India are undermining the principles of microfinance

The Guardian, Comment is Free.  Published 24 March 2010.

India is a land of entrepreneurs. From tech-savvy businessmen to street barbers, the country is full of people who can identify opportunities and use them to their advantage. The unorganised “micro-moneylenders” in the southern state of Andhra Pradesh are no exception.

To illustrate the point, let us take the example of a hypothetical village in Andhra. As with most fertile villages in the region, MFIs (microfinance institutions) have a strong presence in the area. For years now, they have been lending small sums of money to women in the village, purportedly to help them jumpstart micro-businesses. The MFIs send staff to collect weekly loan instalments, which they do in early morning centre meetings. In these meetings, 20-40 customers gather and repay their instalments together, and if somebody cannot pay, the others cover for her. (more…)

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