|Needless Hunger - Voices from a Bangladesh Village (FF, 1982, 74 p.)|
|Us and them|
|7. Foreign helping hand ?|
Foreign aid is big business in Bangladesh. The vehicles of aid agencies ply the streets of Dacca, their offices buzz with activity, and new luxury housing to accomodate their personnel sprouts in Dacca's suburbs. Although private voluntary agencies, of which there are more than one hundred in Bangladesh, are highly visible, they account for only four percent of the aid flowing into the country. The other 96 percent comes from official government agencies and international organizations.
Independence launched Bangladesh on its aid bonanza. Within three years of its break with Pakistan, the nation received $2.5 billion in aid commitments, more than it had received in its 25 years as East Pakistan. The flow is increasing: in fiscal year 1979 new aid commitments are projected to reach $1.6 billion.1 Much of this aid comes from the United States and U.S.-supported multilateral institutions, such as the World Bank. Aid currently finances about half of the government's budget, and is equivalent to nearly 10 percent of the GNP.
On the surface, Bangladesh seems like a worthy recipient of foreign aid. It is an ideal testing ground for the new "basic needs" strategy so popular among major donors like the World Bank and AID. By meeting the basic needs of the poor-food, shelter, health care and education-the aid agencies hope to lay the groundwork for "growth with equity" instead of economic growth alone, which in the past has usually bypassed the poor. But unfortunately, it is far easier to talk about "basic needs" development programs than to implement them. Implementation is the responsibility of the recipient government, which is often more interested in meeting the not-so-basic needs of the rich and powerful than in helping the poor. As we discovered in Bangladesh, programs which on paper help the needy often look very different in the field.
Food Aid for the Elite
About one-quarter of the aid to Bangladesh comes in the form of food aid. The United States provides roughly one-third of this food aid under Titles l, ll, and Ill of the Agricultural Trade Development and Assistance Act (Public Law 480). Under Title I, the Bangladesh government buys American food with concessionary loans and then distributes it according to its own policies. Title II food, given as a grant for disaster relief and humanitarian purposes, is usually disbursed through private voluntary agencies. Under the newly created Title III program, food will be provided to the government as under Title I, but the loan will be written off if the government uses the revenues from the sale of the food for development projects.
Since 1974, most American food aid has come to Bangladesh under the Title I program, giving the Bangladesh government virtually total control over food aid distribution. The Bangladesh government sells the Title I food at subsidized prices through its ration system. Ironically, most of the food aid goes to those who can best afford to pay the market price: the urban middle class. Twentyseven percent of rationed food grains is allotted to members of the military, police and civil service, and to the employees of large enterprises; another 30 percent goes to the predominantly middleclass ration holders in the six urban areas. Nine percent is supplied to mills which sell flour to bakeries catering to the urban consumer.2 It is no secret that the primary purpose of the ration system is to keep prices low for the politically volatile urban population.
The urban ration system is rife with corruption. A December 1977 AID memorandum reports: "The number of urban ration recipients appears now to equal or exceed the total urban population, a finding that would seem to suggest large-scale system leakages." As examples of these leakages, the document cites "double listing of recipients, padded rolls, black marketing of all types."3
Although 90 percent of Bangladesh's people live in the countryside, only one-third of the government's rationed foodgrains are allotted to rural areas. In theory, the ration of rural inhabitants is half that of city dwellers, but in practice they receive even less The rural ration dealers siphon a substantial portion of the foodgrains and sell them on the black market. For this reason, a dealership is a key form of political patronage. The local dealer in Katni's area received the job because his father-in-law had been head of the local administrative body, the union council. As a result of "leakages," only an estimated 14 percent of the rural population receive any grain from the ration system.4
During our nine-month stay in Katni, the villagers were able to buy rationed foodgrains on only five occasions. Each time their quota was only one-half pound of grain per family member. As one villager remarked in disgust, "That is not enough for a single meal-it's hardly worth my time to go and buy it."
Although they recognize the shortcomings of the government's ration system, many aid donors insist that food aid has the beneficial effect of increasing the overall availability of foodgrains in Bangladesh. However, the main problem of the poor is not lack of supply, but lack of purchasing power. Even when rice was plentiful and selling at a reasonable price in the bazaar, the poor of our village went hungry. Title II foodgrains, distributed by voluntary agencies through food-for-work projects, sometimes provide temporary relief to the rural poor but in the long run as we have noted, these rural works projects primarily benefit the large landowners.
Food aid also has adverse long-term effects on agricultural development. Despite the stipulation in P.L. 480 that American food aid should relate to "efforts by aid-receiving countries to increase their own agricultural production," the U.S. Embassy in Dacca acknowledged in a 1976 cable that, "The incentive for Bangladesh government leaders to devote attention, resources, and talent to the problem of increasing domestic foodgrain production is reduced by the security provided by U.S. and other donors' food assistance."5 Moreover, food aid undermines domestic food production by reducing the government's need to procure grain from local farmers and thus support prices at harvest time.
The new Title III "Food for Development" agreement with the Bangladesh government is designed to reduce these adverse consequences. Theoretically, government revenues from the sale of the 800,000 tons of American Title III wheat will be devoted to "selfhelp" rural development and health care projects. But this is little more than an accounting procedure, as money which would otherwise be allocated for these purposes will be released for other uses. As one experienced aid official told us, "Most of the money will probably end up being used to build new staff quarters for the military."
In fact, as this official explained, the main reformist thrust of Title III in Bangladesh lies not in the use of funds, but rather in policy changes tied to the agreement. Chief among these is the stipulation that the Bangladesh government must distribute at least half the wheat through open market sales to private traders. These sales are designed to keep prices from soaring beyond the reach of the poor in the lean season before the harvest-a tacit admission that food aid is more likely to reach the poor if sold on the open market than if distributed through the government's ration system. But whether or not the open market sales will succeed in holding down lean season prices is questionable. Prices soar primarily because of hoarding by merchants, so selling them more food may simply give them greater opportunities for profit. The World Bank notes that in order for open market sales to succeed, the government must "make no announcement as to the quantity available for this operation, thereby minimizing speculation by private dealers."6 Given the cozy relationship between merchants and government officials, prospects do not seem bright.
Proponents of continued food aid to Bangladesh argue that even though the vast majority of food goes to feed the middle and upper classes, the poor would be worse off without it. Without food aid to supply the ration system, the rich would buy their rice on the market. If domestic foodgrain production falls short of the country's requirements, market prices would then soar beyond the reach of the poor. This dilemma leaves the rich of Bangladesh in a position to blackmail the donors: if you cut off our food aid, we won't be the ones to starve.
But the extent to which there is a shortfall between the country's production and its consumption needs is not clear. The sale of foodgrains through the ration system is a major source of government income, providing about one-fifth of the government revenue budget in fiscal year 1977. To ensure continuing food aid and revenue from its sale, the Bangladesh government is said by aid officials to consistently underestimate the amount of each harvest in its reports to the international donors.7 Today Bangladesh must produce about 15 million metric tons of foodgrains to feed its people.8 Estimates of current production vary widely. The World Bank estimate for 1977-78 is 13.3 million metric tons,9but the FAO figure for 1977 is 19.6 million.10 No one really knows, but Bangladesh might even now be self-sufficient in the production of foodgrains.
Ironically, most of the food aid goes to those who can best afford to pay the market price, the urban middle class.
Notwithstanding various "self-help" provisions, food aid by its very nature can only address the symptoms of hunger, not its underlying causes. The logic is simple and compelling: if people are hungry, give them food. But instead of feeding needy people, food aid often strengthens the very forces which create hunger. In Bangladesh, food aid bolsters the elite and undermines any impulse towards self-reliance. In 1976, a U. S. Senate study recommended the phasing out of food aid to Bangladesh over a five-year period, following the advice of experts who believed that a commitment to terminate food aid "was the only way to force the government to take the necessary actions for eventual self-sufficiency."11 This of course raises the question of why it should be necessary to "force" a government to act in the interests of its own people. This recommendation has not interrupted the flow of American food aid to Bangladesh.
Project Aid: A Tubewell for the Village Landlord
Aid to specific development projects would seem to offer donors greater scope for translating their concern for the poor into concrete action. Indeed, much project aid goes to the rural areas, where most of Bangladesh's needy people live. In their project descriptions, the donors frequently identify their "target group" as Bangladesh's small farmers. Unfortunately, most of their aid misses the mark.
Project aid reached Katni in the form of a deep tubewell for irrigation, one of 3000 installed in northwestern Bangladesh by a World Bank project. On paper, the tubewell will be used by a farmers' cooperative formed especially for the purpose. According to the press release which announced the project, each tubewell "will serve from 25 to 50 farmers in an irrigation group."12 In reality, the tubewell in our village was the personal property of one man: Nafis, the biggest landlord of the area. The irrigation group, of which Nafis was supposedly the manager, was no more than a few signatures he had collected on a scrap of paper.
Nafis and his younger brothers inherited 70 acres of land from their father, who had become rich by serving as a rent collector and a procurer of village women for the local zamindar during the colonial era. While attending college, Nafis joined the late Sheikh Mujib's Awami League and soon became an influential figure in local politics. Shortly after independence he was appointed vice chairman of the union council, in which position he misappropriated the few blankets and sheets of corrugated tin which came to the village as postwar relief supplies.
The tubewell was by far Nafis's greatest patronage plum. Although each tubewell cost the donors and the government about U.S. $12,000, Nafis paid less than $300 for his, mostly in bribes to local officials. The tubewell sits in the middle of a 30-acre tract of Nafis's best land. Since it will yield enough water to irrigate twice that area, Nafis says the smaller farmers who till adjacent plots will be able to use his water-at a price. But the hourly rate he intends to charge is so high that few of his neighbors are interested. As a result his tubewell will not be used to its full capacity.
At first we were surprised that the beneficiary of the World Bank's aid should be the richest man in our village, but on closer inspection we learned that this was not so strange. A foreign expert working on the project told us, "I no longer ask who is getting the well. I know what the answer will be, and I don't want to hear it. One hundred percent of these wells are going to the big boys. Each thana (county) is allotted a certain number of tubewells. First priority goes to those with political clout: the judges, the magistrates, the members of parliament, the union chairmen. If any are left over, the local authorities auction them off. The rich landlords compete, and whoever offers the biggest bribe gets the tubewell. Around here the going price is 3000 taka (less than U.S. $200)."
"You see," he explained, "On paper, it's a different story. On paper, all the peasants know these tubewells are available. If they want to have one, they form themselves into a democratic cooperative, draw up a proposal and submit it to the union council, which judges the application on its merits. The union council then passes the proposal to the Thana Irrigation Team, which again judges the case on its merits. If the proposal is accepted, the foreign consultants verify that the site is technically sound. So on paper it all sounds quite nice. Here are the peasants organizing to avail them selves of this wonderful resource. When the high-level officials fly in from Washington for a three-day visit to Dacca, they look at these papers. They don't know what is happening out here in the field, and no one is going to tell them."
An evaluation sponsored by the Swedish International Development Authority (SIDA), which helped to finance the tubewell project, confirms that the experience of our village was typical. The evaluator concluded after examining 270 tubewells:
It is not surprising that the tubewells have been situated on the land of the well-to-do farmers who are the chairmen and managers of the irrigation groups. It (would have) been more surprising if the tubewells had not been located on their land, with the existing rural power structure, maintained largely because of the unequal distribution of land.13
Given the social realities of rural Bangladesh, the outcome of the World Bank's tubewell project was entirely predictable.
For the poor of our village, the only conceivable benefit of the project will be the employment generated by Nafis's extra rice crop. Nafis plans to work part of his tubewell land with hired labor and to lease part to sharecroppers. (Since the yield on this irrigated land will be higher, Nafis intends to take two-thirds rather than his customary one-half of the crop: "After all," he says, "I bought the well.")
Against any employment benefits one must weigh the negative effects of the tubewell: with his extra income, Nafis will be better able to buy out smaller farmers when hard times befall them, driving them into the ever-growing ranks of the landless. He already has an eye on the plots nearest his tubewell.
What lessons has the World Bank learned from this project? One Bank official told us that the tubewell project "should not be used as an example of the Bank's current programs in Bangladesh," because it was conceived in 1969 before the Bank had adopted the basic needs strategy. But while new ideas may become fashionable among aid donors, the realities of rural Bangladesh remain the same. A look at the Bank's "Rural Development One" (RD-1) pilot project, launched in 1976, reveals the old contradictions present in the Bank's new directions.
RD-1 provides $16 million spread over seven of Bangladesh's 410 thanas for everything from rural works, credit and agricultural extension to the construction of government buildings. According to a Bank press release, "One of the most important goals of the project will be to reduce the domination of rural institutions by the more prosperous and politically influential farmers and to make farm credits and agricultural inputs (fertilizer, pumps, tubewells, insecticide and fuel) available to the 'small farmers' through the cooperative system."14
What has happened in reality? An unusually frank internal World Bank memorandum, evaluating the first year of RD-1, concludes that the implementation of the project is "unsatisfactory." The memo cites one cooperative as a typical example: "The manager (of the cooperative) owns 20 acres of land and has held his managerial position since inception, although he has been in jail for the past one and a half years... the TPO (Thana Project Officer) approved a loan of Tk/17,000 to this society in July/August 1977. Other members of this KSS (cooperative) were not aware of this loan. The TPO is unable to give any logical reason for approval of this credit."15
The memo also notes that the local project staff "appears to consider the filling out of innumerable forms to be its main function."16 Because of widespread corruption and incompetence in the public works constructed under the project, roads were washing away and market buildings crumbling within months of their completion.
RD-1 has earned such notoriety in Bangladesh that even AID officials are quick to disassociate themselves from it. One AID official told us: "Don't assume our programs are like that. In our view, RD-1 is a project which has been captured by the rich." Nevertheless, in early 1979 Bank officials in Washington told us that the project is a success, and that they plan to launch a second project on the same lines in the near future.
Despite much talk of "targeting" assistance to the rural poor, AID's rural development projects face the same basic obstacle: the unequal distribution of land and power in rural Bangladesh means that large landowners will inevitably seize the lion's share of scarce aid-provided resources. One of AID's main activities in Bangladesh is the provision of fertilizer; in fact, the recent Title III food aid agreement specifies that over half the proceeds from the sale of the food will be used to purchase and distribute fertilizer.17 Fertilizer prices are highly subsidized by the Bangladesh government, ostensibly to help small and large farmers alike to increase their production. But who does the subsidy really benefit? According to the World Bank: "By most accounts farmers usually have to pay the market rather than the subsidized price, the margin benefiting the middleman instead of the farmer."18 The middlemen are the same merchants, landowners and local officials who hold the reins of power in rural Bangladesh. As usual, not much "trickles down" to the poor.
AID is also becoming involved with rural electrification, which is enjoying a new upsurge of popularity among aid donors in Bangladesh. According to one AID official, electrification will bring such tangible benefits as supplying power for tubewells, increasing the use of radio for agriculture extension services, spurring the growth of local industries, and, at last but not least, making government officials less reluctant to get out into the countryside.
Of all these ostensible benefits, the growth of rural industry would seem most likely to help the poor, who are desperately in need of employment. But what kind of industries are likely? In an interview with OXFAM-America, an experienced foreign field worker described how the Germans and Japanese are trying to market high technology rice mills in Bangladesh. Rather than generating employment, these mills would displace the labor of millions of poor rural women who earn their livelihood by manually processing rice. "It's generally true that expensive technology introduced into an unequal situation increases the inequality," the field worker explained. "The poorest people suffer most... In the present situation, large-scale electrification would lead to large numbers of high technology mills, resulting in the immediate unemployment of these women who would become destitute because there is no other alternative."19
Who Is to Blame?
Confronted with the failure of rural development aid to benefit the poor, foreign donors predictably blame the Bangladesh government, not themselves. "The Bank is not blind to these things," one World Bank official told us, "but our ability to do anything about them is limited. If the government doesn't have the will to help the small farmers, we can't force them to do it. We can advise, we can write provisions into our projects, but without that genuine commitment on the part of the government it just won't work."
But when we spoke to a high-ranking Bengali diplomat, he put it another way: "We have no control over these projects. The World Bank and the other international agencies tell us what to do, and we do it. If they want to give us tubewells or fertilizers because it's good for business in their countries, what are we to do? After all, they have the money."
Both arguments contain an element of truth. Drawing its support from the urban and rural elites, the Bangladesh government does lack the political will to help the poor. But aid donors design and finance projects which time and again benefit these same elites. In veiled statements in confidential documents, the donors occasionally criticize the government, but money speaks louder than words. Indeed, quantity rather then quality seems to be the prime concern of many international aid agencies. That there is a contradiction between self-reliance and the absorption of an ever growing volume of foreign aid seems to escape them.
Why do aid institutions push money on Bangladesh? Partly because aid is good for business back home. The U.S. Commerce Department's publication Commerce America reports happily: "In fiscal year 1977 AID commodity expenditures [worldwide] amounted to $771,132,000, 98 percent of which was in the U.S."20 Moreover, foreign aid has spawned vast bureaucracies with a vested interest in their own survival and expansion.
For Bangladeshs poor, the quiet violence of starvation and the less subtle violence of state repression are two sides of the same shiny foreign coin.
But the main motives behind foreign aid are related to longterm political and economic interests. A prominent aid official wrote in 1964, before the basic needs rhetoric became fashionable:
In the most general sense, the main objective of foreign assistance, as of many other tools of foreign policy, is to produce the kind of political and economic environment in the world in which the United States can best pursue its own social goals ... The second objective, which concerns the immediate future, is internal stability, which is sought by giving politically popular types of aid to existing governments, by the prevention of internal disorders... The third major objective of foreign assistance is security of the United States and its allies from external aggression.21
In Bangladesh foreign aid helps to insure that the government will look kindly on foreign investors, whose eyes are above all on the country's vast reserves of natural gas.22 It helps to promote "internal stability" by allowing the government to buy the support of the urban elite with subsidized food and government jobs, and the support of the rural elite with patronage given under the guise of rural development.
In its 1978 budget presentation to Congress, AID notes: "The U. S. political interests in Bangladesh are limited and reflect a concern for the impact that instability in Bangladesh could have on the subcontinent as a whole."23 Bangladesh borders on the politically volatile Indian state of West Bengal and on hill areas where India has been fighting tribal insurgents for years. Recently Zbigniew Brzezinski, the National Security Advisor for the President of the
United States, has hinted at Bangladesh's strategic importance: "Today the area of crisis is a group of states on the shores of the Indian Ocean-literally an are of instability, which can be drawn on a map from Chittagong in Bangladesh, through Islamabad, all the way to Aden. Their internal fragility, social and political, could interact with the projection of Soviet power... "24
But foreign development aid alone can not buy political "stability" in Bangladesh-it must be backed up by the force of arms. While food aid provides indirect financing for the government's repressive apparatus, military assistance directly bolsters forces which crush any challenge to the status quo. For Bangladesh's poor, the quiet violence of starvation and the less subtle violence of state repression are two sides of the same shiny foreign coin.
Arming the Status Quo
Early one morning as we rode on a bus north from Dacca, we passed a military cantonment. Through the heavy mist we saw a line of prisoners, their heads shaven and their arms chained, marching under armed guard near the road. The genial chatter in the bus stopped abruptly as the passengers absorbed the scene in silence. We had just caught a glimpse of the realities of political repression in Bangladesh.
The governments which have come and gone in Bangladesh have one thing in common: each has used force to suppress opposition. Sheikh Mujib, whose overwhelming victory in the 1970 elections precipitated the independence struggle, originally enjoyed tremendous popular support. But within two years disenchantment set in, as the corruption and incompetence of the ruling Awami League plunged the country into economic chaos. In response to growing opposition, Mujib declared a state of emergency in late 1974, suspending civil liberties and instituting press censorship. In January 1975, he scrapped the parliamentary system, outlawed all political parties except his own, and declared himself president. The prisons filled with his political opponents.
Mujib was assassinated in August 1975 by disgruntled junior army officers, paving the way for a series of coupe. In November 1975, after a convulsive army mutiny, Major-General Ziaur "Zia" Rahman seized power as head of a new martial law regime. In July 1976, Zia's government hung Colonel Abu Taher, a hero of the independence war and leader of the November army mutiny, in Bangladesh's first official political execution since the days of British colonial rule. When a mutiny again broke out in the armed forces in October 1977, Zia responded with mass executions of hundreds of soldiers, setting yet another ominous precedent.
In its 1977 Annual Report, Amnesty International estimated that there were from 10,000 to 15,000 political prisoners in Bangladesh, most held without trial. Within the jails, the organization reported that treatment of prisoners "borders on conditions that are inhuman."25 This dismal human rights situation soon began to tarnish Zia's image in the West. In order to both appease critics abroad and legitimize his rule at home, Zia decided to gradually return Bangladesh to "democracy."
"Until Americans take a hard look at the political realities in countries like Bangladesh, they can expect their foreign aid dollars to perpetuate rather than alleviate poverty."
In June 1978, Zia ran for president in an election held under martial law, and won a predictable victory. Then in parliamentary elections held in February 1979, his party won a large majority of seats. However, only 40 percent of the electorate turned out to vote.26 A senior Bangladesh army officer candidly revealed the motives behind the elections: "The West, and especially the U.S. Congress, likes it if we can be called a democracy," he told a foreign journalist. "It will make it easier for us to get aid. That is the main importance of the election."27
Zia himself echoed this view in a speech to foreign reporters: "Now, with this election and the democratic process being restored more private investment should come into this country."28
Despite some improvements, the human rights situation in Bangladesh is still far from rosy. During Zia's five years in power, more than 1,000 military personnel are reported to have been executed. On May 30, 1981, the illusion of stability was shattered when Zia himself died in a hail of gunfire in an abortive coup attempt.29
The most serious human rights violations in Bangladesh today are in the southeastern Chittagong Hill Tracts, where the government is trying to crush a movement for limited autonomy. A statement by the tribal movement, the Shanti Bahini (Peace Army), published in a prominent Indian journal, charges that the Bangladesh army has unleashed a reign of terror, including rapes, summary executions, indiscriminate burnings and lootings of entire villages, and the creation of "strategic villages" which resemble concentration camps.30 One of the few foreign journalists who managed to visit the area reported "The only able-bodied young civilians I saw roped together, through the town bazaar at Kaptai, 30 miles east of Chittagong."31
Foreign aid dollars are directly supporting Bangladesh's military and police forces. The British government is providing U.S. $1.3 million worth of telecommunications equipment to the Bangladesh police, and eight British military officers are helping to establish a military staff college north of Dacca. Several foreign governments are providing financing for a road in the Chittagong Hill Tracts which will facilitate troop movements.32
The United States, for its part, is providing aid under the International Military Education and Training Program (IMET), which brings Bengali officers to the United States to study "management techniques." The State Department's rationale for the IMET program is "to improve an institution which contributes to stability in Bangladesh and in the region."33 But the stability to be purchased by propping a regime which rules in favor of Bangladesh's narrow elite is likely to prove illusory.
In the long run, economic development is the key to political stability. But it does not follow that in the short run political stability is the key to economic development. This is especially true if what is stabilized is the political power of a narrow elite which puts its own interests above those of the country's poor majority. Until Americans take a hard look at the political realities in countries like Bangladesh, they can expect their foreign aid dollars to perpetuate rather than alleviate poverty.