Remittance meeting on February 22nd at 6pm.

On Tuesday February 22nd at 6pm, Ottawa ACORN members will be meeting at 81 Montreal Rd to strategize and discuss the upcoming March 2nd action on remittance fee reduction. The remittance justice campaign was initiated over a year ago with ACORN members fighting for regulations on remittance costs. The rally on March 2nd at 12pm which members are organizing for, on Tuesday evening, is set to take place at 427 Laurier Ave, located at Laurier and Kent. Childcare and ride services are available for all those attending. For ride services or more information on the meeting Tuesday night, please contact Ottawa ACORN at (613) 746-5999

Watch:

{edocs}/images/docs/acorn_international_houndouras_report.pdf,725,500,link{/edocs}

[scribd id=46598792 key=key-1xw6dapes0x8sdxdvr1g mode=list]

16 December 2010 Last updated at 05:12 ET

India’s micro-finance suicide epidemic
By Soutik Biswas

In his grotty, two-room brick home, all that remains of Ketadi Ramchandra Moorthy is a laminated colour photograph sitting on the cold cement floor. 

Two months ago, the 40-year-old carpenter dropped dead after a heart attack at a bus station in Hyderabad, some 70km (43 miles) away from his rural home in the south-east Indian state of Andhra Pradesh.

He had travelled to the city to beg friends for cash to pay loans he had taken over the course of a year from private micro-credit firms.

A broken man, he had been heading back empty-handed to Gajwel village in Medak district.

A government report said Mr Moorthy had suffered a heart attack “due to pressure put by the micro-finance institutions for repayment”.

“He was so stressed out that he just collapsed and died,” says his wife, K Karuna, 36. 

More than a third of the 30 million households that have taken micro-credit in India live in Andhra Pradesh. The majority of the borrowers are women.

Borrowers’ revolt

But the small loan has turned out to be a big curse for many in the state.

More than 80 people have taken their own lives in the last few months after defaulting on micro-loans, according to the government.

This has triggered the worst ever crisis in India’s booming micro-finance industry.

Scenting votes, opposition politicians have encouraged borrowers to halt repayments – micro-finance companies have given out 80 million rupees ($2bn; £1.3bn) of loans in Andhra Pradesh.

Banks, in turn, have stopped lending to micro-finance companies and fear they may not recover some $4bn in loans.

“Multiple lending, over-indebtedness, coercive recovery practices and unseemly enrichment by promoters and senior executives [of micro-credit companies] has led to this situation,” says Vijay Mahajan, chairman of India’s Microfinance Institutions Network.

India’s micro-finance crisis mirrors the 2008 subprime mortgage meltdown in the US, where finance companies threw cheap and easy loans at homebuyers until prices crashed and borrowers were unable to sell their homes or pay their debts.

But the difference in India is that the borrowers are even poorer, with zero social security.

Mr Moorthy’s story is a tragic example of how micro-loans – annual interest rates vary from 24-30%, compared with the 36%-120% charged by usurious money lenders – can lead impoverished, ill-educated people to ruin.

This defeats the supposed purpose of micro-credit, with all its talk about improving the lives of the poor.

In 2002, Mr Moorthy took a loan worth $350 from a micro-credit company to build his $2,210 home.

Half of the money came via an interest-free loan his wife – who rolls tobacco leaves for a living – took from her employers.

A moneylender chipped in another loan worth $440 that is yet to be repaid.
Ultimate price

In May 2008, micro-credit salesmen descended in droves on Mr Moorthy’s village and he took a second loan worth $330 to pay off small debts to his neighbours.

This second loan, the family say, was paid off within a year.

Undeterred by the debt trap he was falling into, and persuaded by aggressive micro-credit agents, Mr Moorthy borrowed $660 in three loans from as many companies.

These were to pay for the education of his three children, including a college-going son, and, again, to repay previous debt.

When he died in October, he had been defaulting on the latter three loans for up to 20 weeks.

Mr Moorthy’s annual earnings, say his family, usually never exceeded $110.

“Loans have been given to rural people without checking whether they had the capacity to repay,” says Reddy Subrahmanyam, the state’s most senior rural development official.

The government estimates families that have taken micro-loans in Andhra Pradesh have an average debt of $660, and an average annual income of $1,060.

This means more than 60% of their fragile, uncertain income is being spent paying off loans.

Two months after his death, Mr Moorthy’s family struggles to survive, pawning jewellery and depending on the generosity of caring neighbours and vote-seeking politicians.

The eldest son, K Ramanachari has had to give up the college education that cost his father so much.

The 19-year-old has found a job ferrying tobacco leaves on baskets once a week, earning about 100 rupees ($2.2) for a day’s work.

Mrs Karuna rolls tobacco leaves during the day and then, if she is lucky, finds farmwork in the evenings.

All this fetches her less than $3 on a good day.

She pawned her silver and gold jewellery, worth nearly $200, to keep a roof over her children’s heads and send them to school.
Appendicitis to suicide

Two leading politicians, including the state’s main opposition leader Chandrababu Naidu, have lent her $1,100, which she plans to deposit in a bank.

“Big or small, loans kill. I will never take up another loan,” says Mrs Karuna.

Sometimes a loan taken to save a life can end up taking a life in the debt-stricken villages of Andhra Pradesh.

Mylaram Kallava, 45, hanged herself from the ceiling of her mud hut in the neighbouring village of Ghanapur after she defaulted on four micro-loans amounting to $840.

The loans were taken to pay for medical treatment for her 17-year-old daughter’s appendicitis and her eldest daughter’s pregnancy, which ended in a miscarriage.

The nearest government hospitals were more than 70km (45 miles) away, forcing Mrs Kallava to seek private treatment which was well beyond her means.

The three loans were taken in July last year – Mrs Kallava was in default for just two months when she killed herself.

It did not help that her grave-digger husband, Narsimhulu, 55, was in poor health and found work only now and then.

The federal jobs-for-work programme in the village stopped in August, leading to an acute shortage of employment in the area, locals say.

“I could feel that my mother’s tension was building up when she began defaulting,” says her daughter, Sangeeta. “She was unable to get work.

“Her co-guarantors in the group came to the house and asked her to explain. I think she felt ashamed.”

For seven days before she took her life one weekday evening, Mrs Kallava had been unable to find any work.

The micro-loan recovery agents were due to come knocking by the end of that week.

She did not wait for them.

This is the first in a two-part series by Soutik Biswas on the micro-credit industry in India.

BBC © MMX The BBC is not responsible for the content of external sites.

========================================

NOTE FROM COI WEB TEAM: We will post the second in the series when it is posted by the BBC.

From the BCGEU’s latest newsletter BCGEU Supports ACORN India

The original version of this article is available from: http://www.csmonitor.com/World/Asia-South-Central/2010/1107/How-ACORN-could-intrude-on-President-Obama-s-India-visit

On his trip to India’s commercial capital, Mumbai (Bombay), President Obama addressed entrepreneurs, university students, and Asia’s richest man, who just built himself a 27-story house.

But he stayed far away from Dharavi, one of Asia’s largest slums, which was made famous worldwide by the hit 2008 movie “Slumdog Millionaire.”

Inside the slum lies an impolitic connection from Obama’s past that – like Shakespeare’s Falstaff – could have helped balance the president’s view into the lives of citizens here.

The ACORN Foundation India works to organize the slum’s trash collectors and sorters known as “ragpickers.” The group was set up separately by the founder of the ACORN community organization that Obama once worked with in America. Opponents assailed Obama’s ties to ACORN after some of its workers falsified voter registrations during the 2008 presidential contest.

In India, the model does not involve widespread voter registration of the poor – partly because groups like the ragpickers are disenfranchised in the world’s largest democracy. Many of them are migrants or homeless who lack the proof of residence papers needed to vote, says Vinod Shetty, the Mumbai head of the ACORN India Foundation.

“At every stage they are asked for proof of identity, proof of residence. So if you don’t have [that] you are treated as a criminal in the city. So then they have to bribe someone to get something all the time,” says Mr. Shetty. “They are in fact lining the pockets of all these authorities, who have a vested interest in keeping them either informal or without papers.”

ID cards for ragpickers

ACORN India issues the ragpickers identification cards that help cut down harassment by police and neighborhood watch groups.

But since the group cannot be turned easily into a vote bank or organized against a single employer – most are self-employed – they have been ignored by politicians and labor unions.

ACORN India is working with the ragpickers to form a cooperative that helps the adults bargain collectively for better prices and social standing, while providing their kids educational scholarships and enrichment.

“In a city like [Mumbai] you need to be from a powerful section of the poor to grab land or even squat. If you are not protected by a political party, or by a community, or by any kind of gangsters or slumlord, you may not even get that space,” says Shetty.

Life in the slum

Instead, some of the 150,000 to 200,000 ragpickers in Mumbai live on top of the garbage they sort on the fringes of Dharavi.

One such colony lives under a highway overpass around a trash heap hemmed in by two massive water pipes. The pipes have become sidewalks connecting hovels where ragpickers skillfully squeeze profit from the 10,000 tons of trash discarded daily in the metropolis.

Some are cutting large cardboard boxes into smaller panels that are cut and pressed together to form new, smaller boxes with their old logos cleverly flipped inside. Even the old staples are recycled.

Others are sorting for specific detritus like car headlamps or bicycle handlebar grips; such items take on value in bulk.

A man named Syed Sheikh sits under a canopy sorting through a sack of plastic junk he bought for 50 cents. He pulls an item out, taps it against a rock, then tosses it into one of the many bags and piles around him.

“I tap the rock to understand: Different plastic makes different sounds,” he says.

Plastic that’s sorted by color and by grade sells for $3.50 to $23 per sack. Even with his fast pace, the work nets less than 67 cents an hour for him. Still, after three hours of work a day he will earn more than 75 percent of Indians do, according to World Bank data from 2005.

While he lives in a very expensive city and Indian wages have grown in the past five years, his economic reality remains closer to the majority of Indians than the elite Obama met.

‘Green-collar’ workforce?

Shetty says roughly 40 percent of all Mumbai’s waste gets recycled, meaning ragpickers are part of the “green-collar” workforce that politicians and industrialists tout as a “win-win” between environmental and business concerns. ACORN India is resisting efforts to commercialize the sector unless the ragpickers are the ones chosen for the formalized jobs.

Standing in the foot-deep sea of worthless tiny plastic pieces outside Mr. Sheikh’s tent, one can see the tall buildings of Mumbai’s most expensive offices, including Indian Oil, Citibank, and Reliance Industries, the company owned by Asia’s richest man.

The distance, in many ways, is far greater than the gap between the Chicago streets of Obama’s early career and the halls of power in Washington.

“I think President Obama is a long way away from community organizing now,” says Wade Rathke, the founder of ACORN. While he says Obama carries lessons from his community work, “he’s playing a different game.”

Indeed, Obama has used his trip to bring together the heads of multinational corporations to argue for free trade as a means of job creation and economic growth in both countries.

ACORN International’s focus on world’s mega-slums

Mr. Rathke, who left the US ACORN group in 2008, focuses now on a separate organization he founded named ACORN International. The group has members in nine countries, including India, and focuses on the billion or so people who live in mega-slums.

Activists tied to ACORN International will protest outside Obama’s speech to Parliament Monday to pressure Indian lawmakers not to allow foreign companies like Wal-Mart into retail.

“We’re trying to organize a vast base in order to push on all political parties,” Rathke says. “The vision is that people should have the power and they should be able to push governments and corporations to do the right things.”

The article below is from Livemint.com and the original piece can be found at: http://www.livemint.com/2010/10/29181935/Recycling-and-respect.html

Few neighbourhoods in Mumbai have attracted global attention the way Dharavi has. But all the intense, often glamorized focus on the area can misrepresent it. It is justly described as a hub of enterprise, evidence that even the most disadvantaged of urban populations can thrive in spite of adversity.

But celebrating that can-do spirit and the common humanity that visitors and tourists love to identify with, can sometimes obscure Dharavi’s realities.

It can be one of the most hostile working environments in the city, and perhaps no population confronts its risks more directly than its waste collectors, commonly called ragpickers, the base of Dharavi’s growing recycling industry.

“I used to pick and sort plastic all day, too,” says Lakshmi Kamble, 30. “My life was about that. I wanted to be a doctor when I was a child, but we couldn’t afford it. And my whole life, as I grew up in Dharavi, got married, became a mother, got divorced, and moved back here with my daughter—I had no identity of my own.” She was sorting plastic the day she first heard of ACORN India’s Dharavi Project. “I thought to myself, what good would this do me? What was the point of being part of such a project?”

ACORN India, affiliated with ACORN International, is a registered charitable trust currently working in Mumbai, Delhi and Bangalore, focused, in their own words, on four Rs.: “Reduce, Recycle, Reuse and Respect”. The Dharavi Project, which began operations in August 2008, is a participative resource for the communities which form part of the area’s recycling industry. At its heart is a collective that aims to give ragpickers the tools and training to improve their working conditions. Handling toxic materials and the rotten by-products of Mumbai’s industries poses significant health hazards to those who collect and sort them on punishing schedules, seven days a week. The project also aims to give the community the credit they deserve as essential workers in a city whose waste output keeps pace with its rate of growth. They are also faced with a near-total lack of respect and social security, bereft, as Lakshmi says, of any identity beyond that of the unclean and the hopeless.

According to ACORN India, 40% of this unacknowledged workforce consists of women and children: a population that can face exceptional risks and exceptional pressures from their families. Take Lakshmi’s daughter Sheetal, for instance: She used to be teased by others at the local municipal school for having a mother who picked up garbage. Lakshmi says she has heard the same about her own mother—like her, a native of Dharavi and a plastic collector.

“When I came to ACORN, I got my own bearings first,” she says. “I asked myself questions about the work I had been doing all my life. Is it good or bad? I told myself that as unclean or dirty as the job might be, I am doing a good thing. I am taking a load off the BMC (Brihanmumbai Municipal Corporation). Why should I feel ashamed of what I am doing? I explained this to my daughter: Tell those who tease her, so what if my mother does this? She doesn’t have to depend on anyone else to feed me. It put my daughter in the right frame of mind too.”

Today, Sheetal, 11, spends her time outside school in the variety of activities the Dharavi Project organizes for the children of its members. Some of those children—not Sheetal—are ragpickers themselves, compelled by hunger and family pressure to earn money. Through music, sport, dance and art, the Dharavi Project aims to give the community’s children some much-needed recreational space, and allow them to think about alternatives to their future. It has just ended a successful music workshop, and is running a football programme for the children right now.

Watching Sheetal run around on the grass with other girls, Lakshmi says: “The children don’t always come here knowing right from wrong. Some of them felt they only had to earn money, by good means or bad. Some of them committed crimes. But today I feel like these children are learning to create an identity for themselves. If they play games together, then maybe tomorrow they will have what it takes to form teams, to take part in competitions, to stand up to the world outside. They will learn that hard work will actually make a difference in their lives.”

Lakshmi’s mother Hanumanthi too attends the Dharavi Project’s programmes on the big days. “I’m too busy to go along to all their activities,” she says gruffly, but smiles as she recalls Sheetal’s participation in dramas, dance and singing. She is the head of the family as far as Lakshmi is concerned—out of their extended circle of kith and kin, she is the first of the three Kamble women who form the family that Lakshmi values. “My mother is my inspiration,” Lakshmi says. “The values I pass on to the others who come to ACORN India, especially the children, are the ones she gave me.”

Lakshmi is one of the Dharavi Project’s committee members today, organizing the community in rights-based work, training the collectors with whom she works side by side during the day, and ensuring that the other children in the project get the support and guidance they require from their own parents. “We have a chance to give these children the things we have never had,” she explains. It is not easy being a member: She typically divides her day between work, taking care of Sheetal, housekeeping, and ACORN India’s office, where she started to volunteer in March 2009 out of a sense of purpose, and which has become a passion and unpaid vocation.

“My mother was annoyed by what she considered a waste of time at first,” Lakshmi admits. “But now she has come around to the idea. She realizes that even if I earn less money because of the time I give to ACORN, people will know who she is one day: because of her daughter and the work she does.

Dharavi, Asia’s largest slum, is a haven of dry waste- huge mounds of plastic bags, papers, scraps…It is also a home to several migrant workers, ragpickers and destitute, and is probably the world’s largest recycling quarters where almost 80% of the dry waste generated in the city is segregated for recycling into reusable products.

Amidst a pile of discarded mobile phones, chargers, tangled wires, computer spare parts and other electronic waste lives young Shafiq. Dharavi is his home and he has been sifting through these piles since childhood. “My job is to separate every part of the electronic gadget that is dumped here. The plastic and the metal generated from the electronic items is further segregated and then sold to the kabadiwallas. By selling e-waste, I earn a decent amount of money from which I can feed my family.”

Like Shafiq, there is Mangala, diligently scanning each plastic waste dumped at the Dharavi swamp. Sitting in one corner, she sieves the dust, dirt and mud from the plastic items. “I have lost count…I have spent years in this business. This waste gives us a livelihood. If I work from 9 to 6 every day, I can fill my stomach easily.”

Laxmi and several others form the recycling clan of Dharavi, and they are all part of Acorn Foundation (India), Mumbai, a registered charity trust affiliated to ACORN International/ Association of Community Organizations for Reform Now.

Hundreds of children, women and men collect dry waste from the streets, beaches and garbage dumps every day. They bring the waste to Dharavi, where it is sorted, segregated and then sold by the kilo to scrap dealers at various godowns. This waste can get them anywhere between 10 rupees per kilo for e-waste, to 12 rupees per kilo for plastic bottles, or 20 rupees per kilo per metals like copper from circuit boards.

This unorganized labour of Dharavi is an invaluable asset to the city. “If it were not for these ragpickers who recover, recycle and ensure reuse of the waste, Mumbai would have been reduced to a dump yard with serious issues,” says Vinod Shetty, Director of Acorn Foundation (India), Mumbai.

The dry waste like plastic, glass, cloth and paper are segregated and sent to the recycling units in Dharavi, where they are made into reusable products. The plastic waste is converted into pellets; these pellets are further processed and made into folders and buckets. The paper and cardboard is turned into pulp which is used to make folders and furniture. The metal generated from the e-waste is used for industrial purposes.

The society seems to have a “don’t care” attitude towards waste. “Handling waste is probably the dirtiest thing but we forget that we generate that waste. The problem is with our attitude, we don’t take waste as our problem but instead we put it under the carpet or expect others to clean our mess.”

With a nominal fee of 60 rupees, the organization has engaged 400 working members from Dharavi Project. In return, the members can also learn music, art, and photography. Acorn provides informal schooling to the ragpickers’ children, organizes health camps, arranges ration cards, conducts workshops on waste segregation and holds cultural programmes. “At Acorn, we address them as ‘green workers’ and not as ragpickers”

Acorn has also involved school children in waste segregation. It conducts programmes for students on how to reduce and manage waste at home. It screens visuals and documentaries at various schools. Acorn also runs this campaign with CMCA (Children’s Movement for Civic Awareness) and Lions Club of Juhu.

“We work with Dhirubhai Ambani School, the American School, the RBK School and even schools at Navy Nagar in Colaba. We have temps who go around the city and collect dry waste from the schools. It is a contribution by school children to the livelihood of the ragpickers. This is an ideal model where the child learns about segregation of waste, about the environment and, of course, the green workers, ” says Vinod. “The school children also get to tour the recycling industry of Dharavi to understand the concept of waste management better. We would also like to involve college students in our project in the future.”

Acorn study has found that more than 50% of the ragpickers earn less than 50-60 rupees a day. These ragpickers are vulnerable to health related issues and even exploitation. Vinod aspires to represent the plight of ragpickers to the government. He aims to set up a statutory board through which the government could introduce insurance schemes, distribute equipment like gloves, masks and other scavenging materials, and provide space in every municipal ward to segregate waste.

“Our next agenda is to clean the beaches of Mumbai. We want to involve citizens and communities from well-to-do societies. Our members are ready to assist these groups in managing waste,” concludes Vinod.