Bangladesh farmers caught in vicious cycle of flood and debt

Syed Zain Al-Mahmood in the "globaldevelopment blog" at the Guardian (UK): ..."People assume that since floods happen almost every year in Bangladesh, flood-affected people have learnt to cope, but it's not that easy," said Abdul Mannan, a senior official at the Ministry of Food and Disaster Management. "The next month will be hard. These people are in real danger of falling into debt."

Flooding is a significant obstacle to the development of Bangladesh, which is home to two of the largest river systems in the world: the Brahmaputra and the Ganges. This year the floods arrived after the harvest of the dry season rice crop – locally known as boro – but the waters hampered planting for the next crop and prevented villagers in some areas from taking their produce to market. Because the flooding leaves communities isolated, income-generating activities are also severely curtailed.

"When you're poor and hungry, losing your home or crops to floods can mean the beginning of the end," said Anisul Islam, director of the Centre for Natural Resources Studies, an NGO with anti-poverty programmes in the region. "The people affected by natural disasters have no insurance policy and no savings to fall back on. They sink deeper into poverty."

Studies carried out after a major flood in 2004 showed that flooded households often fall into a vicious cycle of debt and roughly a fifth of flood-hit families are pushed below the poverty line.

Other studies have confirmed that flood-affected rural communities often deal with the short-term shocks by adopting extreme coping mechanisms – including borrowing money to buy food, reducing expenditure by skipping meals, and selling assets such as cows and goats. Vulnerable families coping with the destruction of their homes, unsafe drinking water and reduced calorie consumption are faced with crippling interest rates – ranging from 21-67% – charged by local loan sharks....