Se introduce el debate sobre la forma de gobierno

Among the cultural features identified in this study that were associated with the poor sustainability of the FLE practices within the communities, the perverse loan culture or borrowing habit was found to be an important one. It is defined as a dysfunctional habit of rural people to take out repeated loans, use the money for an unintended purpose and not repaying the loan.

The researcher found that it is a custom or habit of the rural people not to return loan money and this habit manifests even in the case of informal exchange of loans among villagers. The lenders often find it difficult to recover the loan from the borrowers. Due to this, savings-credit groups formed by villagers themselves (not by outside agencies) also collapsed in the past.

…..We formed a similar group (similar to an FLE group) in our haat

(village market). We continued for some time with the weekly savings- credit. It was going on fine until the conflict began. Some members did not return the loan money. The samitee broke down…this is the habit of poor people. When they need money they will come to you and say sweet words, brother, please help me I will honestly return your money but when the time of repayment comes the sweet face turns ugly. If you put pressure, the person would say, “I will not return your money, do whatever you can do”. Now you see this is what you get in return for your kindness ….. (Conversation, FLE group Secretary).

Interviews revealed that one important root of the perverse borrowing habit of community people was associated with their involvement in the past and contemporary micro-credit programmes of various NGOs, which are numerous in the FLE communities. Reportedly, due to prolonged interventions by NGO micro- credit programmes, a perverse “loan culture” has developed among the villagers. Out of poor economic conditions, often the poor villagers take loans from various NGOs and spend the money for unintended purposes such as buying food, shopping or recreation. On some occasions, despite intentions to invest the money for income generation, they fail to do so because of unfavourable investment opportunities. In most cases, therefore, the borrowers fail to return the loan money taken from the NGO programmes. Finding no alternative, the poor villagers then begin selling household assets and property to repay the NGO loan. Thus, the poor become even poorer, take one loan after another and thus, enter into a vicious cycle of loans (Figure 4.5).

According to some farmer interviewees, this dysfunctional borrowing-culture was also manifested in the FLE groups. Many of the poor members who failed to return the loan money were also involved with other NGO micro-credit groups or were previously involved with such programmes. Many of them took loans from the FLE group funds for income-generation activities but eventually used the money for repaying their previous loans taken from other NGOs. Being unable to repay their FLE group loans, many members stopped attending group activities, thus leading to a collapse of the groups. The following statement by a group leader during a focus group discussion captures this norm.

……People always want loans because they are very needy. Sometimes when they take loan they go to the market and do some shopping or go to the cinema. It has become a habit of the poor. They take loans after loans

and use the money from one source to repay the money taken from another source. There is a rule in NGO that if a member pays back a certain amount of the dues he/she can take more loans. There is a tendency among the people who think if they can somehow manage to pay back 5-7 instalments then they can again take TK 10000 loan. So, the person keeps on taking loans and ultimately enters into a vicious cycle of loan. The end result is he/she loses everything and turns out to be a beggar or a day labourer. Many of the FLE members also possessed this kind of mentality. They thought FLE would work the same way as NGO groups ….. (Focus Group, site 1)

A poor person takes NGO loan

Spends money on unintended purposes

Sells assets & property Eventually ends

up begging or day labouring

Repays loan but becomes poorer

Takes repeated loan from other sources Fails to repay NGO Loan Pressing needs Lack of skill & education Unsupportive investment atmosphere

Figure 4.5: Vicious cycle of perverse borrowing habits or loan culture among the poor villagers (source: focus group discussion, this study)

4.5 Conclusion

In this chapter the contextual factors/conditions that influenced the non- sustainability of the FLE system are presented. Based on the conceptual framework developed in Chapter 2, the analysis involved the institutional as well as the material resources in the operational context of the project. Institutions were analysed as sources of legitimacy of the FLE model and as sources of incentives for the DAE, the NGO, and the rural people who were to sustain the FLE project, following the period of donor withdrawal.

The results suggest that the key reform principles underlying the FLE model lacked institutional legitimacy to the extension agencies and the rural people. The manifestations of such legitimacy, however, differed among the three groups of actors. This lack of legitimacy negatively affected the performance and sustainability prospects of the system.

From the perspective of the DAE, the FLE lacked legitimacy for four major reasons: (i) the rationale or purpose of the project was undesirable according to the technocratic definitions of extension practiced by the DAE (ii) the concept of working with the poor rural people in FLE did not match with the elitist norms of the DAE employees, (iii) the concept of partnering with the NGOs was perceived as detrimental by the DAE, and (iv) the demand-led principle of the FLE was not compatible with the unfavourable context of policy-in-practice both within and outside the DAE. From the perspective of the NGO, the FLE project lacked legitimacy for two major reasons: (i) The logic of empowering the rural poor in the FLE did not conform to the market-orientation or profit-making values of the NGO and (ii) the concept of demand-led extension did not match with the context of policy-in-practice. At the community level, the FLE lacked cultural legitimacy due to the traditions of patron-client relationships between the rural people and the outside agencies, the weakening of traditional cooperation, and the indifference among the rural people towards development.

The performance and sustainability prospect of the FLE project was also negatively affected by the dysfunctional institutional elements in its operating

context. These dysfunctional elements created perverse incentives for the DAE, the NGO, and the rural people who were to implement and sustain the project. The perverse incentives for the DAE and the NGO originated from their internal working climates as well as from the broader context of donor-recipient relationships. At the village level, the legacy of dole-out and the perverse loan culture were found to create negative incentives for the rural people.

In addition to the institutional context, the scarcity of financial and human resources of the DAE and the NGO negatively affected their ability to support the FLE project both during and after the project implementation period. In the next Chapter, the findings relating to the implementation performance of the case study project are presented.

Project implementation performance

5.1 Introduction

In this chapter the results concerning the relationships between the implementation performance of the FLE project and its sustainability are presented. Implementation performance entailed analysis of the ability of the FLE project to produce the outputs and outcomes as expected by the stakeholders, which in this study were the DAE, the NGO, and the rural people involved with the project. The results in this Chapter are organised into three sections. The first section describes the expected outputs and outcomes of the FLE project from the project implementers’ point of view. The second section describes the performance of the FLE project and its role in garnering support from the extension agencies. The third section describes the performance of the project and its role in generating support from the rural people.