‘Steer clear of the cattle'

According to the microfinance calendar, the past ten years were the decade of the cow. We celebrated the cow as the path out of poverty. At Madura Microfinance, we even benchmarked the loan amount to the cost of a cow. What good is a loan if it's not enough to buy even a cow? And so, over the past decade, the microfinance industry has supported the purchase of millions of cows across the country. Millions of scrawny cows with poor yield, as it turned out, symbolising the inefficiency of microenterprise. I, for one, am glad to be past the decade of the cow, and excited and hopeful that this decade we will steer clear of cows — and pigs, goats, chicken, and antiquated sewing machines, and cottage industries — and celebrate, instead, the human being and their capacity for extraordinary innovation.

Too small?

India has been built on the romanticised notion that small is beautiful. The spinning-wheel became the symbol of a self-reliant India. Each of us independent, spinning our own yarn and milking our own cow. Yet, such self-reliant independence is the very antithesis of progress. By the time we have woken up, milked the cow, cleaned the cowshed, and sat down to spin enough yarn to finally make one set of clothing to replace the old one that is fraying, the light is fading. It's time to cook, eat dinner and go to bed so we can wake up and start the routine again. There is no time for anything else. No time to think.

Progress is about interdependence, and not independence. It is the ability to organise ourselves into groups to accomplish more than what any one of us can on our own — each of us with specialised knowledge and function coming together to create something more than the sum of the parts. We lose our self-sufficiency, our ability to survive independently in the woods. But we gain by becoming a part of something bigger, something extraordinary. It's not so different from life itself — self-reliant single-celled micro organisms such as bacteria have evolved into aggregates of cells with specialised functions that together make up complex organisms.

Root of poverty

Poverty is characterised by a lack of functional specialisation and organisation — people engaged in self-reliant methods of livelihood, where cooperation and organisation rarely extend beyond the immediate family; the enterprise requires little specialisation and is therefore easy to replicate, and too small to enjoy economies of scale. Above all, the backbreaking effort required of self-reliance leaves little time for innovation.

In with the new

In the emerging new India, we are slowly shedding Gandhian ideals of self-reliance, and scale has become the mantra. However, our view of scale has been unidirectional — large urban corporations serving the poor masses. Yet, when these urban corporates constitute such a small fraction of the population, it is horribly limiting in its scope. What if, instead, we could find mechanisms that catalyse functional specialisation and organisation among the hundreds of millions of individual cow-keepers? Maybe then, larger organisations will begin to emerge from the most surprising places and in numbers we could never before fathom. Tall order, you might think, but I am convinced that with our understanding of how interconnected systems function, together we might just be able to crack this.

The author is the Chairperson of Madura Microfinance.

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