Remarkable people!

IT professional Pradeep Ghosh’s mind is a vibrant laboratory, constantly churning new ideas. I met him recently, after economist Bibek Debroy suggested that I do so, to understand an experiment in MP’s Betul district, that he is running. If he succeeds, it could have FMCG and other mass-market companies drooling, the UPA government paying attention, and, most important, provide poor villagers the social security net that they have only dreamt of.

The idea germinated in 2001 when Pradeep chucked his MNC job, and set out to discover how social security systems could be made to work for the poor in 3rd world countries. His big question was: how can the rural poor get protection against downsides in health, food, education, livelihood, and old age-related problems without imposing any taxes on citizens?

The model that he has developed is breathtakingly simple, yet complex to execute:

• Existing Self-Help Groups( SHGs) in a cluster of villages are motivated to focus on livelihood generation. 4 to 6 families are trained to set up non-overlapping retail shops( kirana, clothing, cereals, etc), while some others become local manufacturers(papad, pickles, etc).
• The rest of the families become consumers for these shops, and are guaranteed quality goods and fair price. Based on their quantum of purchases, a certain percentage of the shops’ margin is set aside to provide social security to these families. A family ‘Passbook’ actually tracks each family’s entitlement, and gets them insurance for life, accident and disability, health, and old age.

Apart from social security for the poor, this model leads to local livelihood generation, creation of retail distribution, and a self-sustained community. Most important, it relies on local consumption and economic activity, rather than dole-outs, to solve a vital social problem.

This experiment was rolled out in 2006 with assistance from the MP government, and NGO, Pradan.  Government gave land for the shops, while Pradan helped identify 16 SHGs across 3 villages. As we speak, the shops are ready, and villagers are getting trained to get started.

Over the next one year, Pradeep and the other stakeholders will closely track key outcomes like consumption patterns, self-sustainability of the shops, and the quantum of social security provided.

Meanwhile, the villagers are excited about the empowerment that this project brings them. They decide what insurance to buy, how much, and from whom. They see this as a ‘ hamara apna’ social security.

Even as this experiment is in progress, Pradeep is advising a community in Maharashtra’s Solapur district on a similar initiative. To me, the rapid roll-out and scaling-up of this model seems important. The government’s ‘Aam aadmi Bima Yojana’ is still on paper, but if Pradeep’s model can be quickly adopted by rural communities across India, it is likely to be far more deep-rooted, and impactful.

This entry was posted on Friday, September 14th, 2007 at 6:56 am and is filed under Remarkable People. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.