Analysis of Issues on Micro Credit—The Case of Two Villages in Punjab

Seemi Waheedi


The phenomenon of poverty was felt and observed more during
the decade of 1990s, as the overall growth slowed down. While the slowed
economic growth and recessionary trends contributed to poverty, the
trickle “down effect” once thought, to improve living conditions, did
not reach the lowest level owing largely to lack of accessibility of
institutions, unjust and non-poor policies. For these reasons, in
Pakistan during the decades of 60s and 80s, when the country experienced
high growth rates of 6-7 percent, 34 percent of people still lived below
the poverty line. Socio-economic development, improving the quality of
life in general and of rural poor in particular, welfare have been the
prime stated goals of government. Therefore, rural development
programmes, such as, Village-Aid, Integrated Rural Development Programme
(IRDP), Peoples Works Programme, Tameer-e-watan Programme, Prime
Minister’s Five Points Programme etc. were introduced to improve farm
productivity, which would consequently improve incomes and quality of
life of rural poor. This was done through the Department of Local
Government and Rural Development. Little impact on the life of the rural
poor, however, was observed partly because these were administered
through closed, immutable and cloistered institutions of government
which are not accessible and responsive to the needs of poor. Also, the
lack of focus on community participation and need for it was evident. As
these programmes were managed through government departments these
lacked flexibility and out-reach. The approach of administering was
fixed, rigid and lacked professionalism.

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