Innovation and Development

3 The Tale of the Poor as Market-led Consumers

“The river erodes one bank and builds another. That’s the play of the river.”

Bangladeshi proverb

A 2012 article appearing in The Economist depicts Bangladesh as a country with “dysfunctional politics and a stunted private sector” but with surprisingly good development indicators when compared with its neighbors (Economist 2012). Bangladeshis, indeed, have a life expectancy four years longer than Indians, despite the Indian being, on average, twice as rich. India has grown at a remarkable 8% a year for most of the past 20 years, while Bangladeshi GDP has been growing at a more modest 5%. The percentage of the population living beneath the poverty line has dropped from 49% of the total population in 2000 to 32% in 2010. Between 1990 and 2010, child mortality was reduced by two-thirds and maternal mortality by three-quarters (World Bank 2013). The Indian Union Minister for Rural Development, Jairam Ramesh, wrote in The Hindu on September 2012: “what Bangladesh’s experience shows is that we don’t have to wait for that high economic growth to trigger social transformations. Robust grassroots institutions can achieve much that money can’t buy” (Ramesh 2012). The country has a long history of non-governmental groups, professional associations and missionary groups, but only recently has become famous for its extensive development in the NGO sector (Lewis 2011). In contrast to many other less developed countries, where foreign agencies ...