Informatics Publishing Limited

Abstract

The Human Development Index of tribals is much lower than that of the rest of India's population. In the UNDP Human Poverty Index, tribal communities of India, as a group, are ranked alongside those of sub-Saharan African countries, in the bottom 25. This is alarming, considering that India is a middle ranked country on the same index. Though tribals live in resource-rich regions, they continue to be marginalised in the development process. Microfinance, in this context, has emerged as a promising tool to correct market failure and ensure social-economic-political development of tribals. Microfinance is seen as an empowering tool having the ability to give voice to people and help them deal with exploitative forces.

The paper looks at the outreach of Microfinance among the plain area tribes of Andhra Pradesh (AP) and the factors required for making Microfinance work for tribals. It is based on a study of tribal habitations in the plain area districts of AP commissioned by the Tribal Welfare Department, Government of AP. The paper argues for establishment of community-based financial institutions, bundling business development services with Microfinance and development of physical, social and economic infrastructure for development of plain area tribes. The paper also proposes building up a 'tribal cadre' for effective implementation of development programmes for tribals.

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