Sabtu, 27 Maret 2010

The Role of Agriculture and Rural Development in Poverty Alleviation

Introduction: World Vision and Difficulties to Attack Rural Poverty

IN September 2000, the member states of the United Nations declared to halve the world’s poverty within 15 years.. The UN resolution adopted by the 55th session of General Assembly resolved “to halve, by the year 2015, the proportion of the world’s people whose income is less than one dollar a day and the proportion of people who suffer from hunger …”. Surely, this statement constitutes a very optimistic vision that requires consistent policies, effective programs and projects, suitable strategy and approach, and hard working and commitment from international organizations, government of a given country, local NGOs, and the poor themselves.

However, there are at least two fundamental obstacles that may impede the achievement of the UN vision. First of all, recently around 1.2 billion people live in extreme poverty and the great majority (75%) work and live in rural areas (Rahman and Westley, 1991: 553). Ashley and Maxwell (1991: 395) use a stronger expression to emphasis severe condition of rural area by stating: poverty is not only widespread in rural areas, but most poverty is rural. Unfortunately, it is broadly acknowledged that rural area is lag far behind urban area in terms of economic activities, infrastructure development, as well as social services. Consequently, rural area is lacking of basic precondition to attack poverty, and in turn, people living under poverty line have not significantly decreased. Lipton (1977) describes such kind of regional disparity as “urban bias”, which is one reason why poor people stay poor.

Secondly, global inequality is increasing faster than hitherto suspected. Wade in his study (2001: 74) shows that world income distribution became markedly more unequal between 1988 and 1993. Although the World Bank (2000: 54-55) argues that inequality trend in the world should not be seen as negative if four conditions have been fulfilled: 1) the income at the bottom rise or at least do not fall, 2) the development process expands opportunities for all, 3) the observed trends are not the result of dysfunctional forces such as discrimination, and 4) the number of poor people falls; but it also admits that for a given rate of economic growth, poverty will fall faster in countries where the distribution of income becomes more equal than in countries where it becomes less equal (ibid.: 52). In reality, such kind of economic disparity takes place not only between developing and developed countries, but also between rural and urban area, and between rich people and poor people. It makes sense that in a world where inequalities exist, either absolute or relative poverty remains the core problem. Again, this situation complicates attempts to eradicate poverty, especially in rural area.

Two Focuses of Poverty Alleviation Program

Under the above circumstances, alleviating rural poverty is not a simple thing. Therefore, accurate and comprehensive strategies are substantially needed. The basic idea is that since poverty occurs frequently in rural areas and those who are classified as poor are mostly rural people, then all policies, programs and projects should be implemented based on two focal points: comparative advantages of rural areas as well as on people’s aspiration. Focusing on comparative advantages of rural areas implies the importance to maximize agricultural sector. Ashley and Maxwell (1991: 402) confidently assure that agriculture is the best way to reduce rural poverty. Meanwhile, focusing on people’s aspiration aims to empower people / farmers or to make them to be independent from outsider’s aids and intervention. It also means that native people should be entailed into so-called participatory-based development planning.

Rural Poverty Alleviation Strategies: Some Conceptual and Empirical Evidences

Certainly, there are many agriculture-based poverty alleviation strategies. However, only some primary issues or paradigms will be highlighted in this paper. Among all, the very beginning of paradigm shift in rural development is small-farm agriculture, which is considered as an engine of growth and development (Ellis and Biggs, 2001: 440-441). The proposition of small-farm concept is that agriculture plays a key role in overall economic growth by providing labor, capital, food, foreign exchange, and a market in consumer goods for the industrial sector in a low-income country. Small farmers are believed not only as capable as big farmers of taking advantage of high yielding crop varieties because the input combinations (seed, fertilizer, water, etc.), but also that they are more efficient than large farmers because of the intensity of their use of abundant labor in combination with small land holdings and low requirements for scarce capital. In addition, Singh (ibid.) argues that the growth of the non-farm economy depends on the vitality of the farm economy; and without agricultural growth in rural areas, redressing poverty is an impossible task.

The other key success for combating poverty through agriculture system is activating the functions of agriculture co-operatives. Indian case might be a good example to demonstrate why are some co-operatives successful such as in Maharashtra, while others are not successful such as in Haryana, Uttar Pradesh and Bihar. The main factor for successful co-operatives in Maharashtra is mutual alliance between large and small cane growers (elites / leaders and shareholders). Unlike in Maharashtra, large farmers in Uttar Pradesh and Bihar conspired with mill owners and government bureaucrats who run co-operatives to take the share of benefits and to exclude the small growers. Moreover, there are no complementary interests, in which the larger farmers are not injured if the small farmers are unable to sell their cane (Atwood, 1988). Similarly, Prakash (1999: 47-48) identifies the significance of co-operatives in rural development. In Agra region case, for example, the Primary Agricultural Co-operative Societies (PACS) at the grass root level provide short-term and medium-term credit to the agriculturalists and also non-agriculturalists. The main aim of PACS is to achieve integrated rural development covering all aspects of rural economy and rural people in their entity with special emphasis on the target groups such as small and marginal farmers, landless laborers, rural artisans, scheduled castes and tribes, etc.

From a practical point of view, Moradi (1999: 33-46) conveys that attacking poverty requires attacking many interrelated forces that keep poor people in a state of deprivation. Above all, it requires expanding people’s access to participation in decision-making and to knowledge, training and markets and the other productivity resources for income generation such as land, technology, credit and information.

Moradi’s study actually implies the importance of people empowerment. It is reasonable since however well are the poverty alleviation programs without improving people’s capacity it will be worthless. Therefore, both human-based and non-human-based strategy should be performed simultaneously in order to achieve the best outcomes.

Conclusion: Conditions for Future Success

The objective of rural development is typically to develop agriculture as a key industry in a village and increase the income to raise the living standards of farmers and thereby develop the village (Nishimura, 2002). Due to some difficulties mentioned above, however, there are many possibilities that both rural development programs and rural poverty alleviation programs are likely to be failed. In this sense, von Haugwitz (1994: 20) illustrates the successful in four Southeast Asian Countries (Indonesia, Malaysia, Thailand and Philippines) and failures in seventeen sub-Saharan countries in Africa in terms of agricultural policy. In fact, in almost all sub-Saharan countries, agriculture and infrastructure in rural areas was neglected and undervalued.

Therefore, in order to avoid breakdowns particularly in the future, the following requirements need to be met:

• Since the state has important role in poverty reduction and rural development, it must create the basic conditions that facilitate and stimulate economic growth and development in rural areas. It also must create a favorable climate for investment and transparent economic and agricultural policies for farmers. In particular, the state needs to ensure that the poor can access reasonably performing markets, inputs and agricultural outputs.
• People’s participation need to be constantly encouraged. Various methods could be applied to foster participation such as decentralization, partnership, or delegation of governmental functions.
• Multi-sectoral approaches or cross-sector policies, is also essential. Japanese experience might be a good case, in which government is integrating two or more developmental sectors such as agriculture and tourism (agro-tourism or green-tourism), agriculture and industry (agro-industry), or tourism and industry (tourism-industry). It means that each sector should not be independent; instead it should dependent on and support to each other. In this policy, each sector is interlinked with other sectors, and as a result, they strengthen or fortify each other. For example, foods processing industries from agricultural products are strongly encouraged to be an embedded component of tourism. In other words, one specific characteristics of tourism in Hachiman-cho is food productions (agro-industry). In order to make successful cross-sector policies, effective coordination among institutions is really expected (Utomo, 2002).


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