November 16, 2005

Cell Phones Empower Bengalis

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“The first phone in the world was useless,” said Iqbal Quadir, a Harvard University professor who was invited by the Bengali Students Association to speak about how his company, Grameen Phone, is affecting the lives of people in Bangladesh.

Discussing the development and effects of his company during the lecture, Quadir started by addressing the question, “Why does poverty persist despite progress and technology?”

He criticized the programs of top-down development that aid organizations have implemented. Quadir said, “Technology helps people from below,” and it empowers the citizens by giving them the means to build themselves up, rather then depending on outside organizations.

Joydeep Chatterjee ’06 said that the lecture was “a wonderful opportunity for Cornell students to explore how hand-to-mouth aid to third world countries is not the solution to problems that can be solved by private business development.”

Bangladesh is one of the poorest countries in the world. When Quadir first started thinking about the importance of communications in 1993, it also had one of the lowest numbers of telephones. One third of these, he estimated, were being used by the government, and Bangladesh had virtually no phones in rural areas.

Quadir recounted a memory from his childhood: “I walked all morning to get some medicine for a sick sibling and when I got there the medicine man was not there.”

The mix-up came because his family lacked the ability to get in touch with the medicine man.

He came to the conclusion that “connectivity is productivity.” With this in mind, as an adult he returned to his home country of Bangladesh and eventually started a company that provides cell phone services to people all over the country.

His ideas were contrary to the popular mindset at the time. He said that in 1993 the idea was, “Once you are rich, then you get telephones, not the other way around.”

Quadir teamed up with Grameen Bank, a micro-credit organization, to develop the company. Originally the bank had lent money to women mostly to buy cows. The women would sell the milk and use the profits to pay back the bank. Quadir realized, “a cell phone can be a cow.”

In rural areas trustworthy borrowers from Grameen Bank are given phones. The women then allow others to use their phones for a fee. These women make about two dollars a day which is about twice the average income in Bangladesh.

The company has grown to serve over five million subscribers, directly created 180,000 jobs, made millions of dollars in profits and become the largest provider of financial resources to the Bengali government because of taxes and licensing fees.

“We are trying to do a good service, and we are trying to make money, because otherwise you cannot grow and you cannot provide that service,” Quadir said in response to the profits in excess of $100 million a year that Grameen Phone is making.

The company has also encouraged entrepreneurship in other areas. Quadir gave one example of a man who opened up a tea shop next to his wife’s telephone store because people would come into his shop and talk on their phones.

Shah Parvezjamal ’07 said “The presentation changes the way people see poverty in a place like Bangladesh.”

Mubdiul Ali Imtiaz ’06, president of the Bengali Student Association, said “We want to raise awareness of social political issues that affect the lives of people in Bangladesh and West Bengal. There are so many poor people there and we think we have the power to do something about it because there are so many students and professors that show an interest.”

Archived article by Mariel Bronen
Sun Staff Writer