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Extremism and Microfinance
There are some interesting turn of events in India in past month in connection with extremists' involvement in microfinance. Two specific events make it interesting. One in North Eastern part of the country, very far from Andhra Pradesh (AP) where currently a crisis is unfolding, and the other right in the state of AP.
NDTV, a major TV news channel, reported on 9th Nov 2010 that largest militant outfit in North Eastern region United National Liberation Front, have been using microfinance to attract local support. They are forming women groups and giving out loans. This is to prove governments ineffectiveness and woo the locals towards their cause.
On the other hand, another large militant outfit popularly known as Maoists or Naxalites are threatening MFIs to leave women alone. This is of course their effort to capitalize on the alleged suicide scandal that is making rounds.
"The CPI(Maoist) secretary for Karimnagar, Khammam and Warangal districts – Mr Sudhakar has warned MFIs of dire consequences if they do not stop recollections in a statement issued to the media on Friday. The statement also warns Vikram Akula (founder SKS Microfinance), V Hanumantha Rao ( Congress MP of Rajya Sabha and Vikram Akula’s Uncle) , promoters of L&T Microfinance, Swayamkrushi and Chaitanya microfinance of serious consequences if they did not immediately suspend operations in the state.
The Maoist leader further alleges that the Microfinance Ordinance is a sham and microfinance companies are using their political clout to operate indiscriminately in total violations of the ordinance. The statement also blames the followers of Sonia Gandhi and Rahul Gandhi as being responsible for the spate of microfinance related suicides in the state.
The Maoist leader demanded that the government should grant five acres of agricultural land and a compensation of Rs 5 Lakh to the families of those microfinance clients who have committed suicide"
Thought it was an interesting conundrum to share with the group.
NDTV, a major TV news channel, reported on 9th Nov 2010 that largest militant outfit in North Eastern region United National Liberation Front, have been using microfinance to attract local support. They are forming women groups and giving out loans. This is to prove governments ineffectiveness and woo the locals towards their cause.
On the other hand, another large militant outfit popularly known as Maoists or Naxalites are threatening MFIs to leave women alone. This is of course their effort to capitalize on the alleged suicide scandal that is making rounds.
"The CPI(Maoist) secretary for Karimnagar, Khammam and Warangal districts – Mr Sudhakar has warned MFIs of dire consequences if they do not stop recollections in a statement issued to the media on Friday. The statement also warns Vikram Akula (founder SKS Microfinance), V Hanumantha Rao ( Congress MP of Rajya Sabha and Vikram Akula’s Uncle) , promoters of L&T Microfinance, Swayamkrushi and Chaitanya microfinance of serious consequences if they did not immediately suspend operations in the state.
The Maoist leader further alleges that the Microfinance Ordinance is a sham and microfinance companies are using their political clout to operate indiscriminately in total violations of the ordinance. The statement also blames the followers of Sonia Gandhi and Rahul Gandhi as being responsible for the spate of microfinance related suicides in the state.
The Maoist leader demanded that the government should grant five acres of agricultural land and a compensation of Rs 5 Lakh to the families of those microfinance clients who have committed suicide"
Thought it was an interesting conundrum to share with the group.
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