Click here for search results

Site Tools

Andhra Pradesh Rural Poverty Reduction

IKP beneficiaries

Indira Kranthi Pantham, the local name for the Andhra Pradesh Rural Poverty Program, is the longest running livelihoods program financed by the Bank in South Asia. It comprises two projects that grew from a UNDP pilot initiative and have ultimately covered nearly the entire state: the Andhra Pradesh District Poverty Initiatives Project (2000-2006) and the follow-on Andhra Pradesh Rural Poverty Reduction Program (2003 – 2009).






IKP seeks to:

  • Build strong institutions of poor – womens' SHGs and their federations
  • Support the poor in improving their livelihoods and quality of life
  • Enable the institutions to be self-reliant – financially and in management
  • To reduce the incidence of girl child labour by improving access to education for them
  • Support to persons with disability through formation of their sanghams (groups) and improving their livelihoods
  • Network these institutions with financial institutions, markets, and other support institutions
  • Orient line departments and PRIs to function in a pro-poor manner
  • Convergence of all anti-poverty, policies and programmes from state to village level.

The self-managed grassroots level institutions and federations of poor rural women are the key ingredient for:

  • local level capital formation;
  • developing the skill base of the poor through intensive training;
  • promoting grassroots leadership of the poor, particularly women; and
  • achieving voice and scale.



The program has mobilized nearly 9 million women into about 630,000 self-help groups (SHGs), covering 95% of the poor in the state. These SHGs have been federated into some:

  • 29,000 village organizations (VOs),
  • 910 sub-district (Mandal Samakhyas/MS) and
  • 26 District Organizations (Zilla Samakhyas).

Institutions for Social Action

Social action has played a major role in building social cohesion within groups and among institutions. Having achieved scale and voice through federations, they have taken up several problems that affect women on a daily basis and found sustainable solutions to them—such as, Community Managed Family Counseling Centers.


Community organizations have partnered with state and national commissions for women (mahila adalats), the Central Social Welfare Board, and local NGOs to set up 22 such centers, which provide a forum to discuss sensitive issues such as gender violence. A special effort is made to identify victims of this type of violence, especially among single women and a participatory rehabilitation approach is adopted. The victim is provided with priority access to livelihoods and additional funds to support income-generating employment. The centers also arbitrate resolve marital disputes and other community level discriminatory disputes, and the Mandal Samkhyas follow-up to see that agreements are being followed.




The poor and their organizations have cumulative savings exceeding US$340 million and have leveraged more than US$1.2 billion in credit from commercial banks since 2000. According to an independent evaluation by Center for Economic and Social Studies, Hyderabad, the average income has increased by 115% from US$483 to US$1041 per annum for project participants over the last five years as against 64% increase for non participants. A household is spending three times more on education of the family. There has been a reduction in indebtedness and vulnerability as well as distress migration.


"I used to survive on head loading, when, in 2004, I joined a few others to go and learn from the women in Anathapur district. After returning, we started weekly savings and received small loans. Initially, a lot of people migrated and it was difficult for us to repay the loans. But after starting the food security credit line, it became much easier. I want to convey, on behalf of my community that there have been a lot of changes for the better. The incidence of tuberculosis has greatly been reduced, women are using the hospitals for deliveries and more of our children are going to schools”

--- Chenchu Tribal Leader, Mahbubnagar District




Rice Credit Line in ActionFood insecurity is a major vulnerability faced by the rural poor and is an important goal when addressing rural poverty. In order to meet the shortfall, in income and consumption needs, households borrow from money-lenders and traders at very high interest rates, pushing them further into debt trap. Alternatively, the poor reduce the quantity of food consumed.


This model of food security is a market based one which offers food as a credit product rather than grant or aid. Food Security Line is a community managed credit and food distribution mechanism to address the food requirement of the rural poor. The Food Security Line provides a single window within a village for purchase of food grain, packing and distribution of food grains and recovery/ repayment of the outstanding credit, thus making it accessible for the poorest.


By the end of 2007, it is estimated that Food Security Line will be extended to 3 Million households across 12,000 villages and generate a business turnover in excess of one million metric ton equivalent of rice or $ 300 Million for the village organizations.


Key Results: Beneficiaries access quality food without any gap for the whole year. Household food consumption has increased by 25%.




Self-help Groups and Village Organizations operate 1600 procurement centers trading in 81 commodities worth over US$100 million annually. These centers provide a medium to aggregate, value-add, and supply to partners at a fair price, offering a profi table business model as well as an enhanced price for erstwhile dispersed producers. Partners include large cooperatives such as APMARKFED, agribusiness multinationals like ITC, Ltd. and export houses like Olam International. These linkages have enabled enhanced prices by 30% for small and marginal farmers. In addition, these centers make the millions of individual economic activities viable and sustainable.


Skills and a robust institutional structure provide an optimal environment for innovations to thrive. The program is constantly facilitating and scaling up organically evolved innovations. One of the most recent ones is that community organizations are now acting as banking correspondents and business facilitators are using smart cards to pay beneficiaries of National Rural Employment Guarantee Scheme (NREGS) and other public social protection schemes.


The program has linked over 45,000 youth from poor households to jobs in the private sector through a market based training program. Youth have found placement in the construction, textile and service industry. They are now providing sustained livelihood support to their families.


Sustainable and Profitable Agriculture


AP-RPRP has developed partnership between communities, leading scientists, and NGOs working on sustainable agriculture to develop Non- Pesticide Management practices (NPM). NPM is an alternative model of agriculture which replaces chemical and other external inputs with local knowledge and natural methods of pest management. Covering 186,000 acres in 2006 -07, this is the largest intervention in the country. Cost savings from US$40 to US$120 per acre leading to a 75% increase in the income of a farmer. In addition, this intervention had positive effects on farmers’ health status and encouraged environmentally sustainable production of cotton. This activity was the cover story for “Down to Earth” magazine on May 31, 2006.


Partnerships with NGOs, fair trade companies and organic export houses are linking small cotton farmers to the global organic market, providing them 40% higher prices.


“One in every nine persons on earth is a rural Indian, nearly 70 per cent of Indian villagers do not have bank accounts”

70 percent of marginal/landless farmers do not have bank accounts; and 87 percent have no access to credit from a formal source. Transaction costs of dealing with formal banks are high – as clients often have to pay hefty bribes (ranging from 10 to 20 percent of the loan amount) to access loans. It takes thirty-three weeks for a loan to be approved by a commercial bank.


The use of rural ATMs and biometric smart cards addresses the problem of corruption, leakage and targeting errors .


Every beneficiary in the pilot area is issued a smartcard to establish proof of identity. The smartcard contains basic details of the beneficiary and his/her biometric data. Payments are made to only those beneficiaries with smartcards. A partnership was established with Commercial Banks for ensuring transfer of payments through the Business Correspondence Network (BCN) in each village. A village organization (i.e., federation of SHGs within a village) or an SHG designated as the banking business correspondent in each of the pilot villages.


Key Results. Nearly 40,000 poor have benefited from this pilot initiative. They were provided with smart cards and a zero balance savings account. Payment of the public schemes was credited to members account within 4 days of release of amount to the bank. The village organization receives a fee worth 2% of the total payment.


Innovation: Rural ATMs


This approach is being piloted to handle savings and credit transactions on behalf of commercial banks. Community organizations as banking correspondents and business facilitators are using smart cards to pay beneficiaries of National Rural Employment Guarantee Scheme (NREGS) and other public social protection schemes.


Future Potential

  • Banking services can reach 15-20 million rural poor.
  • Estimated annual saving due to this intervention across the State of A.P. is US$ 4.7 million.
  • Over 30,000 new jobs as Banking Business Correspondents in Andhra Pradesh alone
  • This innovation can be used to bundle other financial services to make other social protection services efficient.


For every program activity, community members are offered training in specialized skills that provide a sustainable and cost-effective medium for scaling up.

There are over 140,000 grassroots professionals across the state known as community resource persons. These professinals offer services such as mobilizing and monitoring institutions and federations, management of enterprises, quality control, para-legal services, community health services, job resource information, micro-planning, and business agents. Many of these resource persons are currently helping to mobilize groups and federations in Bihar.

Last updated: 2009-01-07

Permanent URL for this page:

Indira Kranthi Patham Overview

Indira Kranti Patham Links

Indira Kranti Patham Resources

More Indira Kranthi Patham Resources