There are acres upon acres of tea fields in Syhlet, a western district of Bangladesh. Each day thousands of women wake up at dawn and work until dusk picking tea. Their families have been living the same life for more than 200 years. Brought from Assam, India, to work the Bengali tea fields by the British, these workers make a “living” wage — .5 taka per kilogram of tea harvest. .5 taka is half a penny. Think about that for a second. I have purchased a kilogram of tea for $10 before. These women might work a fortnight and not make that amount of money.
Willem Van Schendel in A History of Bangladesh writes, “What set the colonial period apart, however, was the organisation of cash cropping, the scale of its production, and a succession of new crops that began to be produced for overseas markets. European and South Asian capital was invested in the large-scale production of opium, indigo, tea, silk and jute. Some of these crops were grown under systems of coerced labour, others on plantations — capitalist agricultural enterprises run by Europeans” (p. 60).
When microfinance talks about alleviating poverty, it is important to note that almost no system targets the extreme poor. While microfinance has certainly helped families cross the poverty line, the poorest of the poor — who are often generationally poor — are rarely touched by microfinance programs. Microcredit institutions target “entrepreneurs,” which in developing nations usually means that the borrower already has some type of business. Whether that business is pottery, rice husking, or a fishery, it means that the borrower simply needs a loan to sustain or grow her business. For a tea picker, who has little capital and even less business knowledge, Grameen’s model of “borrower knows best” microfinance is not enough.
For those in extreme poverty, microfinance needs to be coupled with technical assistance and cooperatives. I would recommend that you all look up an NGO called BRAC (it is the largest NGO in the world). It has microloan programs that give borrowers the ability to learn a trade. Then, BRAC pays them for that trade at fair market price. Per example, BRAC realized that the aggregate demand for milk in urban areas far exceeded aggregate supply. However, milk produced in rural areas could not be delivered to urban areas because of a lack of technical infrastructure. Dairy cow owners also lacked knowledge about antibiotics and proper health techniques. In response, BRAC created a supply chain system that connected rural villages to urban towns; it also provided technical assistance along the way.
Day after day, hundreds of thousands of kilograms of tea are harvested in Syhlet. Girls start coming to the fields with their mothers when they are of “proper age.” And the system continues. “Borrower knows best” microfinance has not provided “tea picker” families with an answer.