Danish development assistance policies in international context

Since the 1970s, Denmark, together with Norway, Sweden and the Netherlands, has set aside more money for development assistance to the least developed countries (LDCs) than all other countries measured as a percentage of gross national product (GNP). The willingness of these ‘like-minded countries’ to grant development assistance is well documented.

In the 1980s, the research project titled ‘Western Middle Powers and Global Poverty’, under the leadership of Cranford Pratt, produced a number of works arguing that the like-minded countries shared a common approach to foreign policy called ‘human internationalism’. One of the most distinct trademarks of this approach was a high level of aid spending. In his contribution to the project, the Swedish social scientist Olav Stokke argued that there was a correlation between social political values and aid spending and that development assistance was to some extent an international extension of national social welfare policies. This pointed to the fact that the like-minded countries had all developed extensive welfare states at home.Footnote ²

In the 1990s, Canadian social scientists Alain Noël and Jean-Philippe Thérien refined the argument for the connection between domestic welfare state ideology and aid spending by showing a correlation between aid spending and ‘welfare socialist attributes’ in a number of countries. They argued that, generally speaking, the size of aid spending was an expression of ‘the capacity of a society to accept and institutionalise nonmarket principles of income distribution’.Footnote ³

A possibly negative consequence of granting aid from an international extension of domestic welfare state thinking was pointed out by the Danish economist Martin Paldam in his 1997 book titled Dansk u-landshjælp – Altruismens politiske økonomi (Danish Foreign Aid: The Political Economy of Altruism). Here Paldam describes Danish foreign aid as an undertaking whereby the primary goal is to satisfy a domestic audience's need to express altruism, rather than fulfilling the needs of the people of the recipient countries. This lack of a primary constituency of recipients that can express its own needs has created a system which is ill-equipped to react to and correct less than optimal policies. At the same time the shifting focus of the domestic debate and the influence of various single-purpose humanitarian groups have created an aid programme with many conflicting priorities and a lack of clear focus.Footnote ⁴

Until recently, historians of Denmark have paid little attention to Danish development assistance history, despite the relatively large Danish contributions to foreign aid.Footnote ⁵ This has changed since around the year 2000 and recent historical research seems to confirm the links between welfare state ideology and development assistance, which have been described by Stokke and by Noël and Thérien, also in addition to some of the problems described by Paldam and other researchers. However, historical research has also shown that Danish aid policy has had many other goals in addition to acting as an extension of welfare state ideology. Foreign policy goals have included strengthening multilateral co-operation, developing positive diplomatic contacts and securing access to new markets.Footnote ⁶ And domestically, the high level of aid spending has been used to show a generally pro-aid Danish public that Denmark is pitching in to help the starving masses and is taking its international responsibilities seriously.Footnote ⁷

Danish policy before 1975

Originally, Danish development assistance policy was not tailored to further clear-cut goals in specific development countries, either political or economic. Rather, it was a product of the increased international attention being given to development issues and the role of development assistance around 1960. Domestic interest groups, youth organisations and non-governmental organisations (NGOs) wanted Denmark to do its part for the poor masses of Africa and Asia. At the same time, Danish policymakers viewed an active development assistance policy as a natural extension of the Danish foreign policy focus on peaceful international co-operation and international organisations, while at the same time hoping that aid relationships could develop into increased commercial contact with third world countries.Footnote ⁸

In many respects Danish aid policy of this period was a reflection of the general Danish policy towards the newly independent countries, which stressed self-determination and the right of these countries to select their own type of government and road to development. This professed neutrality was expressed in the early formulation of a development assistance doctrine which stressed the apolitical nature of Danish aid, and which stipulated that Denmark in principle was prepared to aid all LDCs, regardless of their form of government, and that aid was only to be given at the request of the recipient country and in accordance with its own development plans. This neutral or apolitical approach was also one of the reasons for Denmark's large contributions to United Nations (UN) development programmes; Denmark viewed multilateral aid as more ‘neutral’ and in better accordance with the wishes of the recipient countries. Despite the official focus on the needs of the LDCs, Danish development policy was, however, not devoid of Danish self-interest. The neutral approach was well suited to furthering Danish economic interests and a large proportion of Danish aid was tied to an obligation to purchase in Denmark, as it was hoped that this strategy might help Denmark gain a foothold in markets dominated by the former colonial powers.Footnote ⁹

In the period from 1965 to 1967, however, the focus of Danish aid policy partly shifted to a policy of ‘goal fulfilment’ inspired by the international targets set by the UN and the Development Assistance Committee (DAC) for economic transfers to LDCs. Though these targets were internationally formulated, the main reason for this shift in policy was domestic. An alliance of Danish youth movements, NGOs and centre-left parties demanded political action to remove Denmark from the position near the bottom of the DAC comparative statistics on aid-giving, which they considered an intolerable blemish on Denmark's international image. Thus, in 1967, the Social Democratic government presented a plan to enable Denmark to reach the target of granting one per cent of national income as development assistance in 1975. Though the target later shifted and fulfilment was postponed, the adoption of this plan marked a shift in Danish policy to a focus on the sheer volume of aid expenditure rather than the specific political or developmental goals connected to aid giving. In the years following 1967, the volume of Danish aid increased rapidly, from DKK 145 million in the financial year 1966/67 (USD 20 million) to DKK 463 million in 1970/71 (USD 62 million).Footnote ¹⁰

Traditionally the Danish adoption of international aid targets in the 1960s has been ascribed at least in part to US pressure for allied burden sharing.Footnote ¹¹ However, this interpretation needs to be modified for at least three reasons. First, the relevant archives in the Ministry of Foreign Affairs do not contain any evidence that the great increase in Danish aid spending in this period was a direct or indirect result of American diplomatic pressure. Second, the Danish parliament took the initiative to push through a greater increase in aid spending than the Danish government had proposed. Third, the sharpest increase in Danish aid spending took place in the late 1960s, at a time when both US aid spending and US interest in allied burden sharing were declining.Footnote ¹²

The sharp increase in aid funding was greeted positively across the political spectrum, albeit with minor variations in levels of enthusiasm. The strongest proponents were the centre-left Social Liberal Party and the left-wing Socialist People's Party, while the two major centre-right parties were enthusiastic in paying lip service to the percentage targets but less cheerful when it came to paying the bill. The Social Democratic Party favoured the goal-fulfilment policy but tended to be cautious about the sharp increase in aid when it held governmental power. When in opposition, as it was in 1968–71 and 1973–5, the party was generally much more vocal in demanding a sharp increase in aid expenditure.Footnote ¹³

One of the reasons for the broad support was due to the principle of ‘compartmentalisation’ in Danish aid policy developed at the end of the 1960s, which contributed to making the increase in aid politically acceptable to all parties. This principle was not so much a conscious political choice as it was the result of a series of political compromises. Compartmentalisation meant that increases in aid spending were more or less automatically distributed to various sectors of the aid programme relating to the interests of different interest groups. Thus, it was generally agreed that 50 per cent of Danish aid should be given as multilateral development assistance, primarily channelled through the UN and the World Bank. This was in accordance with Denmark's emphasis on international co-operation and the UN. At the same time it underlined the neutral Danish approach to development assistance. Of the 50 per cent set aside for bilateral aid (which in most years actually amounted to 55–60 per cent), half was to be given in the form of development loans granted on very lenient terms but tied to the purchase of Danish industrial goods. These loans were popular with Danish industry and the right-wing parties for obvious reasons. The other half was to be given in the form of technical or project assistance, primarily in the form of Danish development projects planned and executed by DANIDA and, to a lesser extent, by NGOs. Project assistance played a role in the diplomatic ties to a range of LDCs but was also given for the benefit of the Danish public, Danish NGOs and aid professionals. Project assistance ensured that Denmark was seen to be doing identifiable work in the field with concrete results that could justify the large sums being spent and which could function as an outlet for the altruistic energy in many organisations and individuals. Many regarded project assistance as the pure form of development assistance where purely developmental goals were pursued free of political and commercial interests, in contrast to the development loans which were tied and thus ‘tainted’ by economic self-interest. Yet, while project aid was untied in principle, Denmark was still the largest supplier of both experts and goods.

Thus, in the period 1960–75, three general principles of Danish development assistance policy developed which influenced the planning, implementation and fate of the NIRDP in different ways: neutrality, goal fulfilment and compartmentalisation.Footnote ¹⁴ Political neutrality vis-à-vis the receiving countries underlined other key aspects of Danish foreign policy such as the UN and the principle of national self-determination, and also functioned to avert domestic political disagreement over the aid programme. Goal fulfilment became the overall purpose of Danish development assistance policy and almost developed into a kind of volume fetishism that overrode former political priorities to some extent. The total amount of transferred funds became the single most important success criterion for Danish policy, and aid spending measured as a percentage of GNP became a yardstick for the nation's moral health and standing as a respectable international actor. Compartmentalisation served to underline the principle of neutrality (by signalling ‘balance’ in the Danish aid programme). Even more importantly, it cemented the coalition behind the increase in aid spending, as it ensured that all interest groups (including those more sceptical towards aid) had their priorities attended to.

The policies of goal fulfilment and compartmentalisation, however, also produced an overflow of funds in certain sectors of the Danish aid programme. This was not a problem for the multilateral component of the Danish aid programme, as the responsible use of Danish funds was in this case not the responsibility of the Danish government or DANIDA. It was, however, a problem for the bilateral component, where great efforts had to be made to find takers for Danish developmental loans (a problem which decreased in the 1970s as the loans were made cheaper and the opportunity for Danish loans became more commonly known to LDCs), and to find suitable projects for Denmark to fund. These problems were further accentuated by the fact that the increase in aid spending outpaced the increase in DANIDA staff, which made the Danish aid programme the most understaffed in Scandinavia. At the same time the policy of goal fulfilment meant that DANIDA was under continuous pressure to find outlets for its ever-increasing funds. Thus DANIDA was always on the lookout for suitable projects – and preferably large ones.

Basic needs and women: national and international reorientation of aid priorities in the 1970sFootnote ¹⁵

As was the case for most other aid donors, Denmark's development assistance policy in the 1960s was characterised by a somewhat simplistic understanding of the positive correlation between input of capital, gross domestic product growth and poverty alleviation. Danish aid was poverty-oriented, but only by virtue of the fact that Danish project aid (but not development loans) targeted poorer LDCs. DANIDA had its share of white elephants: large modern demonstration projects such as factories, dairy demonstration projects, teaching and health institutions which seemed unable to produce visible results in improving people's lives on a larger scale, even when locally successful. As the first UN development decade came to an end, the trickle-down approach to development was increasingly brought into question, and international debates on development assistance began to look for new approaches.

The increased international attention paid to reformulated development goals in the 1970s was well received in Denmark, where development assistance had been discussed (at least in public) as a humanitarian rather than a power political undertaking from the beginning. The World Bank's increased interest in poverty alleviation and rural development under President McNamara and the formulation of a basic-needs strategy by the International Labour Organization was greeted with positive interest in Denmark, where a reorientation of aid towards more social goals was also being discussed. When the Danish aid legislation was revised in 1971, the first paragraph stated that the goal of Danish aid was to support the receiving countries’ plans for economic growth ‘and thereby secure their social progress and political independence’.Footnote ¹⁶

Another international development that was echoed in the domestic political debate in Denmark was the increased focus on women's liberation and gender equality. In the Danish parliament voices were raised which demanded that increased attention be paid to women and gender-related issues in the implementation of Danish development assistance. Following a request by parliament that Danish aid should be sensitive to the role of women in the development process, DANIDA formed a committee in 1976 that recommended that DANIDA direct increased attention towards persuading receiving governments to focus more on development activities that benefited women. The careful wording of the committee's recommendation served to conceal a fundamental problem for the implementation of new goals in Danish development assistance policy: that every attempt to employ Danish aid to further poverty alleviation and activities which benefited women would break with the core principle of neutrality or non-interference in Danish development assistance unless this took place at the request of the receiving countries’ government.Footnote ¹⁷

The inherent contradiction between neutrality and non-interference, and the desire to adopt a more socially oriented aid agenda, was seldom addressed in Danish public and political debates. Part of the explanation for this was that concrete policy formulation was more or less the prerogative of the foreign minister, the Ministry of Foreign Affairs and the aid administration. With due attention to the mood in cabinet and in parliament, these institutions took all practical decisions regarding Danish aid, including the selection of receiving countries and aid projects, the recipients of development loans, and deciding on the size of the allocation to the various international organisations within the 50 per cent multilateral assistance framework. While many interest groups, such as NGOs and industrial and agricultural organisations, had a say in the process or had their priorities attended to within the framework of compartmentalisation, parliament as such was sidelined and very seldom passed binding decisions on foreign aid issues. Instead, DANIDA and the Ministry for Foreign Affairs tried to incorporate statements made by politicians into Danish policy; even so, they were generally given a very free hand in formulating concrete development assistance policy. Within this framework, it was left to DANIDA to implement the new political focus on women and basic needs in Danish aid policy without compromising the principle of neutrality and non-intervention.

Bangladesh and the NIRDP: the implementation of the new agendas

After an initial policy of spreading Danish aid projects thinly over a wide number of countries to accommodate foreign policy and commercial considerations, Danish project aid was focused on four so-called primary recipient countries at the start of the 1970s, namely Tanzania, Kenya, India and Bangladesh. While the first three had been major recipients of Danish aid since the early 1960s, the status of Bangladesh as a Danish primary recipient country from 1975 and onwards grew out of the large amount of humanitarian assistance offered by Denmark from 1970 to 1972 following the succession war with Pakistan and the great flooding catastrophe in southern Bangladesh in 1970. Between 1971 and 1975, Bangladesh received DKK 168 million (about USD 30 million) in aid, making the country the second largest recipient of Danish aid in that period after Tanzania.Footnote ¹⁸

Early Bangladeshi aid focused on reconstruction instead of long-term development, which was a problem seen from DANIDA's perspective. This focus was a natural consequence of the huge problems that the new nation faced after the war with and succession from Pakistan. Nonetheless, it was a priority for DANIDA to shift its efforts in Bangladesh towards long-term development projects, as this was the main goal of Danish project aid allocations.

In negotiations with Bangladesh in 1975, DANIDA sought to refocus Danish aid towards long-term development. However, the Bangladeshi government was still mainly interested in commodity assistance to make up for the acute shortages that the country still faced due to lack of foreign capital to import key commodities such as fertiliser and soyabeans. Presumably to please the Danish donors, Bangladesh suggested that from 1976/77 Danish aid could be concentrated on developing the Bangladeshi fishing industry and on integrated rural development in a specific area. DANIDA was receptive to the idea and proposed the Noakhali district, as it also offered the possibility of fishery projects.Footnote ¹⁹

Because Bangladesh was a primary recipient country, aid allocations to the country were planned five years ahead according to a ‘rolling’ five-year plan. This was both an advantage to the receiving country, which was able to plan several years ahead, and to DANIDA, as it helped to plan a steady outflow of cash so Danish aid could meet the international targets. However, the system also meant that DANIDA often had rather large amounts of aid that needed to be spent in one way or another. The promising aspects of aid to Bangladesh in 1975 led DANIDA to set aside DKK 40 million for project aid to Bangladesh in the financial year 1976/77 (USD 7 million) as part of its five-year plan for 1976–81, with the intention of increasing this aid gradually to DKK 75 million for the financial year 1980/81. All in all, Bangladesh was expected to receive close to 15 per cent of all Danish project aid in the coming years, a decision that was taken at a time when DANIDA's experience with long-term development project aid in Bangladesh was almost non-existent.

Thus, DANIDA had a great deal of money on hand and some new priorities that it wanted to focus on and, from the very beginning, direct poverty alleviation and the role of women in development were integrated elements of the Danish plan for the NIRDP. Early draft proposals specified the goals as economic growth and social progress that targeted the poorer sections of the population, while paying special attention to the task of involving women in the project. The careful wording revealed DANIDA's awareness of the problems posed by the principle of non-intervention. What would qualify as ‘special attention’ was not specified and, in a country such as Bangladesh, ‘poorer sections’ was a definition as broad as the Ganges delta. Despite the careful wording, however, it soon became clear that Bangladeshi and Danish opinions differed as to what kind of integrated rural development project the NIRDP should be. While DANIDA viewed the emerging NIRDP as its own Danish project with a purpose formulated by DANIDA in many respects, Bangladesh regarded the project as a part of its overall national plan for rural development.

Bangladesh's national integrated rural development strategy was inspired by the so-called Comilla model of rural development. Originating from rural development projects in the (then Pakistani) Comilla district, located directly to the north of Noakhali district, the Comilla model focused on increasing agricultural output, improving infrastructure and establishing local co-operatives which distributed credit and oversaw development activities. Besides the improvements in farming, the Comilla model's development activities were also aimed at generating employment for the population in rural areas, thereby increasing the income of the landless and sharecroppers and decreasing the flow of unemployed people to urban slum areas.

Integrated rural development programmes inspired by the Comilla model became the primary Bangladeshi approach to rural development in the second half of the 1970s. Due to Bangladesh's dependence on foreign aid, the Government of Bangladesh (GoB) sought to ‘outsource’ rural development to various donors. The World Bank's International Development Association, the Asian Development Bank and DANIDA began integrated rural development programmes in 1977 and 1978.Footnote ²⁰

Though the Comilla model targeted the rural population, it was not ideally suited to poverty alleviation or targeting basic needs. During the second half of the 1970s, it was widely realised that more prosperous farmers received the lion's share of distributed credit and tended to dominate the local co-operatives, while sharecroppers and the landless did not benefit much from the co-operative system even though the infrastructure projects could offer employment possibilities. Also, they could benefit from the social services, including health care, which were a part of the Bangladeshi plan for rural development. DANIDA thus faced at least two challenges in making its own version of an integrated rural development project live up to the domestic expectations of an increased focus on basic needs, poverty alleviation and women: to secure access to credit and development funding for the poorest and women and to upgrade the social services component in the GoB's version of the Comilla model.

Despite its lack of experience in Bangladesh and the principle that Denmark should only assist LDCs in pursuing their own development plans, DANIDA assumed de facto responsibility for developing plans for the project. Initially DANIDA suggested a proposal for a project that included educational components and health services with a draft budget of DKK 120–150 million (USD 20–25 million). However, this proposal was rejected by the Bangladeshi Ministry for Planning, which could not accept that such a large sum was to be used in such a small area and which wanted a project more focused on increasing agricultural production.Footnote ²¹ The GoB's knowledge that specified amounts had already been set aside for Danish aid to Bangladesh under the five-year plan thus made it possible to reject more generous offers, as the money would still be transferred in one form or another.

As a result of Bangladeshi opposition to the initial ideas, educational and social services components such as health and family planning were downplayed in the Danish project plans and public works programmes and irrigation were prioritised, in accordance with Bangladeshi priorities. As education and social services were a key part of DANIDA's vision of how to target the poor and women, the project lost some of its poverty-oriented aspects and came to resemble more closely other integrated rural development projects in Bangladesh. In DANIDA's final project proposal, which was presented to the Danish parliament's budget committee for approval in January 1978, the budget had been slashed to a Danish contribution of DKK 93 million for a five-year project period from 1978 to1982. The GoB was to contribute the equivalent of some DKK 8 million for agricultural credit and to pay for land purchases and maintenance of project buildings. Of the allocated Danish funds, 31 per cent was earmarked for infrastructural improvement and 28 per cent for components aimed at improving agricultural production. These two major component groups did not specifically target the poorest sections of society or women. Even though the project appraisal report stated that the main target groups were to be smaller farmers and the landless, these two groups covered 80 per cent of the local population. Only two small components, commanding around 5 per cent of the total budget, targeted the very poorest and women specifically.Footnote ²²

Despite the reorientation towards a more standardised Bangladeshi rural development project model, at home DANIDA presented the NIRDP as a showcase for the Danish adoption of the basic-needs approach to development and underlined the positive effects expected for the poorest and women. In its 1976 annual report, DANIDA's board presented ‘rural development’ as a possible road towards a basic-needs approach to development and described how such an approach should and could target the poorest and women and referred to DANIDA's plan to launch a rural development project in Noakhali.Footnote ²³ After the approval of the budget by parliament in January 1978 both Christian Kelm-Hansen, chairman of the DANIDA board, and Kaj Baagø, the DANIDA officer responsible for the planning of the project, stressed the basic-needs approach and the targeting of women and the poorest in the Noakhali district in interviews. Though Baagø also stressed the problems that lay ahead, both internally and in statements to the press, DANIDA co-operated with the media to raise expectations for this new big project and its more direct way to target poverty alleviation.Footnote ²⁴

In the field: problems from before day one

The NIRDP suffered the fate of failing on many fronts from the very beginning, partly because of a lack of preparation for the problems that were to be encountered on the ground, despite the fact that it was perhaps the most thoroughly prepared project in the history of DANIDA in 1978. Despite a commissioned local economic survey of the area that laid the foundation for a project appraisal report,Footnote ²⁵ many of the components were only sketchily outlined and the possible problems in co-operating with local and central authorities turned out to have been greatly underestimated.

A crucial element of the Danish vision for the project was the idea of ‘integration’. In the NIRDP, all fourteen project components were meant to work together so the area as a whole would benefit from the project and the population could have various needs addressed by different parts of the project. To oversee and administer the many parts of the project, an elaborate administrative structure was designed, consisting of a project advisory team (PAT), a Danish co-ordination unit situated in Copenhagen, and no less than four levels of committees in Bangladesh consisting primarily of Bangladeshi officials. Yet despite (or because of) the many co-ordinating bodies that were proposed, the NIRDP was ill-prepared for the problems with the various administrative entities in Bangladesh that would ultimately arise.

The biggest problem was that the NIRDP was still very much a Danish project disguised as a Bangladeshi project executed with help from DANIDA. With an aid mission in Dacca, a steering unit in Copenhagen and close to fifteen Danish experts with families and six volunteer ‘junior doctors’ on the ground in Noakhali, DANIDA hoped that this massive Danish presence would be able to solve any problems that arose – whether administrative or developmental. The Danish nature of the NIRDP was further underlined by the fact that fully 39 per cent of the overall cost of the first phase was accounted for by Danish experts and the steering unit in Copenhagen.Footnote ²⁶

In DANIDA's own view, the chief reasons for the problems encountered by the project were lack of preparation on the Bangladeshi side. While it is true that the local authorities had not taken the actions described in the Danish project document (and sometimes had not even been informed about the project's existence), DANIDA itself had been in a hurry to start its project right away and had disregarded procedures and lack of administrative capacity on the Bangladeshi side. The haste and lack of knowledge of Bangladeshi procedures meant that Denmark proceeded to launch the project even before it had been formally approved by the GoB. Furthermore, while the Danish project plan described the various individual components of the project, it devoted little attention to how these components were to be executed: which Bangladeshi officers had which responsibilities, what the specific goals were and how they should be reached, or for that matter, to how the efforts required by the various Bangladeshi administrative entities should be co-ordinated.Footnote ²⁷

The lack of formal Bangladeshi approval of the plans effectively paralysed the project from the start. Many Danish experts became under-utilised for months. Few local officials were aware of the project's existence, and Danish funds paid to the GoB could only be released to the project on a provisional basis, which caused many long delays for procurement. This resulted in Danish equipment getting held up for months in customs awaiting release. For two years, the project went forward on an ad hoc basis without formal Bangladeshi approval and without the stipulated Bangladeshi executive director, a situation that put strain on the relationship between the Danish experts and the local administration they were supposed to be working with.Footnote ²⁸

These problems affected nearly all the project's components, perhaps most severely the health and family planning component. This component's aim was to build and equip a number of family welfare centres with staff educated by the project where poor women would be able to receive both medical attention and advice on family planning techniques, while more remote areas could be served by local female staff trained at the centres. Placing great importance on co-ordinated family planning and health services, DANIDA allocated no less than eight experts to support the component: a Danish doctor, a nurse and six volunteer medical students who were to function as ‘junior doctors’.

The establishment of the centres progressed very slowly, however, and it proved very difficult to co-ordinate the participation of the various Bangladeshi administrative entities that were supposed to participate. Local and regional health officials had not been properly informed about the nature of the component and not all supported the attempt to co-ordinate health services and family planning. The notion that Danish medical students could be labelled ‘junior doctors’, just because they were in Bangladesh, also created local scepticism. Adding to the confusion, their role was not adequately described in the plans for the component, and many of them became increasingly disillusioned with both Bangladeshi authorities and DANIDA. In the end, most of the planned buildings were erected, but all Danish staff except the nurse was withdrawn in 1981.Footnote ²⁹

Another component that was vital to the social aims of the NIRDP which initially encountered similar problems was the educational pilot scheme (EPS), which was nevertheless more successful in reaching some positive results. The goal of the EPS was to improve the quality and relevance of primary education, establish non-formal education activities for adults and to involve the local community in the development process through education. Despite these lofty goals, there was no detailed plan for the implementation of the EPS in the appraisal report. With no approved plan, the advisor responsible for the component had great difficulty in securing co-operation from local authorities. The two project areas were situated fifty miles apart, which added to the difficulties. After the initiation of the project, it was quickly discovered that the situation on the ground was worse than anticipated. A planned equipment and supplies scheme for primary schools had to be redrafted as a reconstruction scheme due to the poor physical standard of many schools. In addition, the discovery that only 25 per cent of school-age children were actually attending schools led to a project reorientation, as following the original plan would have meant that the project would not have reached the poorest 75 per cent of the population. This led the project to establish ‘feeder schools’ which prepared children for enrolment in the normal school system. The component thus succeeded in identifying some of the problems related to education in the project area and showed that larger educational activities could be organised outside the existing system. This knowledge proved useful later in one of the NIRDP's few successes: the Mass Education Programme in the second phase of the project, which will be described later.Footnote ³⁰

In addition to the health and education components, the other components of the project also met many problems and achieved mixed results. One of the largest budget items, the irrigation component, was more or less a failure. Plans for drilling deep tube wells and supplying pumps failed to produce any significant results and the major part of the component, the establishment of a number of water control structures, turned out to be more or less useless. This was because the need for these sluices was based on the planned implementation of another extensive irrigation project for the Northern Noakhali region that was never carried out.Footnote ³¹

Establishing rural co-operatives was a central element of the Comilla model. At the same time co-operative ideas had been held in high esteem in Danish development assistance thinking since the birth of Danish foreign aid. Because of their country's strong co-operative movements and traditions, most Danes – experts and laymen alike –viewed co-operative structures as beneficial and serving to improve social justice almost instinctively. The problem pertaining to strengthening co-operatives and co-operative credit in the NIRDP was, however, that the existing co-operative system which the Danish project was supposed to strengthen was a government top-down system rather than the ideal system of small local co-operatives established by the local population for the benefit of the local population. First and foremost, the centrally implemented system of co-operatives in Bangladesh functioned as a system for the distribution of centrally allocated funds and credit. As the local elites dominated the co-operative system, the more prosperous farmers got the lion's share of the loans granted, while sharecroppers and the landless sometimes had a hard time even being admitted into these co-operatives. Thus, rural credit schemes distributed through the existing co-operative system could actually function to strengthen wealthier farmers’ local control of development resources, thus undermining Danish goals of poverty alleviation. This was not an unknown to DANIDA at the beginning of the NIRDP, but it was believed that special efforts to include smaller farmers in the co-operative system would succeed in negating this effect and would ensure that the poorer sections of the rural population got a share of the credit being offered.Footnote ³²

In some ways, the large number of Danish experts on the ground, which was intended to help the project along, also added to the problems. For some Bangladeshis, their presence was a sign of arrogance towards local expertise, and the large sums spent on these experts only intensified these feelings. As mentioned earlier, the concept of junior doctors was also a source of scepticism; sending Danish medical students out to advise experienced health personnel did have a certain air of neo-colonialism, or at least of cultural superiority.Footnote ³³ As for the rest of the PAT, it consisted of skilled experts, though not all were equally experienced in working with development projects and hardly any spoke Bangla. Often accompanied by spouses and families, the PAT practically established a small Danish colony in the project area, which to some Bangladeshis might have been reminiscent of former colonial masters living their affluent lives secluded from the native population.Footnote ³⁴

Phase two: extension of the project in 1984

Despite the numerous problems that the NIRDP encountered, the Danish parliament approved the addition of a second phase to the project in 1984, which was to run from 1984 to 1990 with a budget of DKK 350 million (USD 35 million in 1984) and was to cover the whole greater Noakhali area. Almost all of the components of the first phase were retained, although some alterations were made.Footnote ³⁵ The 2001 post-impact study of the project commented on the continuation of most components in the following terms: ‘It is difficult not to regard this to some extent as a case of institutional inertia and a reflection of vested interests, especially on the Bangladeshi side.’Footnote ³⁶ However, it would be wrong to regard ‘vested interests’ and especially ‘institutional inertia’ as something pertaining only to Bangladesh and not to the Danish government or DANIDA, which had the primary responsibility for the surprising decision to extend and expand the project, as will be explained in the following discussion.

In aid negotiations with Bangladesh in the first half of the 1980s, although DANIDA was still regularly confronted with requests for commodity assistance, it continued to believe that project aid should be given in the form of projects and not just as shipments of goods. Nevertheless, DANIDA continued to grant substantial amounts of commodity assistance to Bangladesh for lack of suitable poverty-oriented projects. Thus, the majority of Danish aid granted to Bangladesh in the 1980s consisted of commodity assistance in the form of Danish goods. Most of this aid could not be considered poverty-oriented; in fact, later analysis has pointed out the role that commodity assistance played in maintaining the status quo in Bangladesh, as the goods were distributed unevenly by the government in order to secure the backing of key groups.Footnote ³⁷ In contrast to all the rather non-photogenic deliveries of Danish goods, the NIRDP represented an important proof that Danish aid actually helped the poor in Bangladesh, a function that became even more important after another major series of projects to improve local fishing in Chittagong threatened to become an even bigger embarrassment.Footnote ³⁸ Thus DANIDA needed the NIRDP to continue as long as the project could be reasonably defended.

The problems encountered by DANIDA's flagship did not go completely unnoticed in Denmark. Visiting journalists reported on numerous problems, although DANIDA was seldom criticised directly; rather, emphasis was placed on the difficult conditions that the project worked under.Footnote ³⁹ In 1980, however, the Danish Public Accounts Committee criticised the project for not reaching the target groups (women and the poorest) and similar criticism was voiced by development professionals and researchers.Footnote ⁴⁰ Yet within DANIDA and on the DANIDA board, the NIRDP was generally viewed with cautious optimism, despite the delays and problems with Bangladeshi bureaucracy. In 1981, it was agreed to extend the duration of a number of components to 1984, primarily because they were running behind schedule.Footnote ⁴¹

In 1983, the DANIDA board began to consider whether to extend the project with another phase after 1984. Despite a positive presentation of the perspectives for an extension by DANIDA to the board, the board decided to await the ongoing evaluation of the project.Footnote ⁴² In fact, the evaluation turned out to be highly critical of the project, especially of DANIDA's insufficient planning. Nonetheless, there was never any serious consideration as to whether a second phase should indeed be executed. For the reasons mentioned above, there was little incitement for DANIDA to withdraw from the NIRDP, and the DANIDA board agreed to the DKK 350 million second phase, which was later approved by the Danish parliament.

On the GoB side, the project harmonised with the overall Bangladeshi approach to rural development, and even though commodity assistance might have had a higher priority, the NIRDP was clearly something Denmark wanted to be doing. The GoB itself insisted on the extension of the project area, as it now favoured a district-based approach to rural development and was not willing to accept that such large sums be channelled into such a small geographical area.Footnote ⁴³ Thus, the extension of the project area was not a decision based on successes that needed to be spread out to a larger area, but simply reflected that the project had to adapt to a shift in Bangladeshi development policies.

Though many of the project's components were continued, it would be unfair to characterise the second phase as an unconscious continuation of the first. Increased attention was paid to the possible benefits for the poor and women and these target groups were mentioned specifically in the stated purpose of the project. This reflected both the realisation that the first phase had been insufficiently successful in reaching these groups as well as the increased attention being paid to poverty alleviation and women's role in development in Danish domestic debates. The 1983 evaluation had recommended a discontinuation of the health component, but it was nonetheless included at the request of the GoB, as it was still government policy to include health services in rural development schemes.Footnote ⁴⁴

The second phase of the NIRDP met with many of the same problems that had been encountered in the first phase, though DANIDA was able to learn from experience and adapt to the circumstances on the ground in Bangladesh to some extent. Seen in that context, the decision to extend the project allowed DANIDA to draw on accumulated specialised knowledge that would have been lost had the project been terminated. Yet the project was still a mixture of Bangladeshi priorities for rural development based on the Comilla model and the Danish desire to target weak groups which did not benefit from the Bangladeshi approach. In the second phase of the NIRDP, 50 per cent of the funds was channelled to classic Comilla model activities, primarily infrastructure, irrigation and agricultural credit. Also, 16 per cent went to a rural poor programme (RPP) that had been set up by the GoB to target the poorer sections of the population, partly as a result of pressure from Denmark and other donors. The RPP focused on generating self-employment opportunities and organising the poor and landless in co-operatives to secure their access to credit, but also included a health services component. While many of the efforts within the RPP had some moderate success, they failed to engage the line ministries responsible and subsequently had low sustainability. An exception was the formation of special credit co-operatives for the poor and assetless. Over 45,000 men and women were organised in such special co-operatives outside the Comilla model system. The NIRDP broke important new ground in this respect and the system of co-operatives for the poor and assetless, with its own independent loan fund, was later adopted by the GoB and implemented in other parts of the country.Footnote ⁴⁵ Though still primarily a classic rural development programme, a larger proportion of the funds now targeted poverty alleviation specifically and with some moderate success. Of the remaining 34 per cent of the funds spent on the second phase, 9 per cent went to the PAT and not less than 21 per cent went to a mass education programme (MEP) which became the most spectacular element of the second phase of the project.

The ideas for an MEP originated in the success of the EPS in establishing informal educational groups for children and adults under the first phase of the project. At the end of the first phase, the EPS was expanded into an MEP, and, in the second phase, the MEP grew to become almost a mass movement in the Noakhali area. Close to a quarter of a million children and adults received some form of education under the MEP. At its zenith, the MEP had over 250 people on its payroll in addition to over 8,000 voluntary teachers.Footnote ⁴⁶ Part of the explanation for the success of the MEP was its relative autonomy from Bangladeshi institutions, which allowed it to recruit staff on the basis of skill and enthusiasm, thus avoiding the more rigid recruitment traditions prevalent in some areas of the Bangladeshi administration. Focus was placed on the participation of students, not only in education but also in the MEP movement as a whole, which had a distinctive bottom-up character that was markedly different from most other Bangladeshi institutions.Footnote ⁴⁷

While the MEP celebrated successes both in relation to literacy and changing its beneficiaries’ views on matters such as the role of education and women's rights, the programme was not very successful in raising the material living standards of the recipients of education, although children who received education fared better in the normal school system than others. However, the MEP failed to transform itself into a sustainable institution at the end of the NIRDP. To some extent, this was the price paid for the benefits gained by working outside the established institutions. Of the two Bangladeshi institutions that could have taken over responsibility, the Bangladeshi Rural Development Board did not have the skills or the authority to run the MEP after DANIDA withdrew, and the Ministry for Education lacked enthusiasm for a project it had itself had little to do with in respect to both planning and implementation. Ideas about handing over the MEP to an NGO or forming an NGO out of the project itself were not realised, and the MEP came to a somewhat abrupt end when DANIDA withdrew from the NIRDP in 1992.

Disillusionment and termination

The cautious optimism that DANIDA and the Danish government had entertained regarding development co-operation with Bangladesh in the period 1983–4, when the extension of the NIRDP was agreed, quickly changed to a more negative view of the prospects in the latter half of the 1980s. One reason for this was that the beginning of the second phase experienced many of the same difficulties the first phase encountered, including delays caused by (in the Danish view) inefficient Bangladeshi bureaucracy. Another was a general disillusionment in Denmark with the perspectives of poverty-oriented aid to Bangladesh.

In August 1985, less than a year after the launch of the NIRDP's second phase, the chairman of the DANIDA board expressed his view to the board that the situation in Bangladesh seemed to call for ‘qualified pessimism’ and that Bangladesh could turn out to be one of those few cases where foreign development assistance efforts were in vain. None of the board members disagreed with his overall negative assessment, though the NIRDP was presented as a more positive item in an otherwise bleak picture.Footnote ⁴⁸ Apart from the persisting problems with numerous Danish projects in Bangladesh, the new negative view was very much inspired by the report Rural Poverty in Bangladesh which had been commissioned by the Scandinavian aid countries and which pointed to the failures of the Bangladeshi government and foreign aid donors in reducing poverty in Bangladesh.Footnote ⁴⁹

In the autumn of 1985, the Danish Council on Development Co-operation discussed aid to Bangladesh in light of the report and a general scepticism regarding the Danish engagement was voiced. Especially from the left of the political spectrum, demands were being made that Denmark abandon aid to Bangladesh and focus on countries where the governing elites, in their view, took poverty alleviation seriously. Even those who favoured a continuation of development co-operation with Bangladesh acknowledged that Danish aid needed to be reoriented to the social sector and other areas where it would be harder for local elites to monopolise its benefits.Footnote ⁵⁰

The disillusionment with Bangladesh coincided with a shift of focus in Danish development assistance policy as a whole in the latter half of the 1980s, away from the principle of neutrality and non-interference towards more specific developmental issues. Besides an increased focus on poverty and women, new issues were human rights, policy reform and structural adjustment policies and a more sector-based, rather than project-based, approach to development assistance. In focusing on these new goals Denmark was following the international trend among donor countries and the World Bank. Yet while most other donors cut back on aid in the late 1980s, Denmark increased its aid rapidly after 1985, reaching its self-proclaimed goal of 1 per cent of GNP in 1992.

All of these factors worked to the disadvantage of Bangladesh and the NIRDP. The NIRDP was ill-suited to reach the new development goals and the Danish aid community had lost much faith in the possibilities of pursuing an effective poverty alleviation strategy in Bangladesh. Much of the sympathy of the early 1970s disappeared by the late 1980s, and increased attention was paid to human rights violations in the Chittagong Hill Tracts and a perceived lack of results in achieving economic and democratic development. Furthermore, the NIRDP and other projects continued to fall behind spending targets, which forced DANIDA to fall back on commodity assistance to meet its own spending quota for Bangladesh.

DANIDA officers planned for a third phase of the NIRDP which would have run from 1991 to 2000, but in the end the plans never materialised, despite the fact that the proposed project had fewer components and a simpler administrative setup. Danish disenchantment with Bangladesh and rural development projects meant that it was decided to phase out the NIRDP after an extension of the second phase from 1990 to1992. In DANIDA there was a widespread feeling that the former flagship had turned into an embarrassment and many were eager to close the book on the project. Though some activities were continued, the somewhat abrupt termination left one of the more successful components, the MEP, in a void, as DANIDA's attempts to secure its continuation under the auspices of the GoB failed.Footnote ⁵¹

The termination of the NIRDP was not the end of Danish development co-operation with Bangladesh. In fact, Danish aid to Bangladesh rose from DKK 70 million in 1977 to DKK 365 million in 1991 (DKK 148 million in 1977 prices), before dropping to DKK 224 million in 1992 (USD 37 million). But since around 1990, aid to Bangladesh has been decreasing as a percentage of total Danish disbursements. Commodity assistance came to be viewed with increasing scepticism by DANIDA and it became increasingly difficult to find projects that could live up to Danish goals and priorities. Some work continued, but the enchantment was clearly gone.