3.

Factors Affecting Development

There are number of factor which affect positively and negatively for the development. Considering
those factor, development activities should be accelerated for the appropriate result. Some of
affecting factor are as follow:

 Political institutions, property rights, and rule of law

 Government Intervention
 Levels of corruption
 Educational standards and labor productivity
 Capital
 Level of savings and investment
 Flow of foreign aid and investment
 Currency Strength
 Interest Rates
 Levels of infrastructure – e.g. transport and communication
 Labor mobility
 Environmental Impact- the market for fur apparel declined drastically over the course of a
few years in the 1990s when consumers perceived that raising and killing small animals for
their fur was both inhumane and a poor use of land.
 Resources
 Location
 Climate
 Stability-‘Bangladesh is a land of natural disasters, so this is unfortunately an important factor
in our doing business here.’

Financing o f Development
Capital is the most important factor for the development. For accelerating the any kind of
development work capital is foremost important element. If there is more financing
possibility of economic development is also high. For capital formation there are three
stage: (1) creation of saving (2) mobilization of saving (3) investment

Source of capital formation are:

Internal source
1. Voluntary saving
2. Involuntary saving- taxation, compulsory lending
3. Use of the idle resource
4. Profit of the public enterprises
5. Internal public debt
6. Deficit financing

External Source
1. Foreign aid
2. Import restriction
3. Improvement in terms of trade

Human Resource Development

Human is also a resource and important factor for development. Development refers to a process of
active learning from experience-leading to systematic and purposeful development of the whole
person, body, mind, and spirit. Thus, HRD is the integrated use of training, organizational and career
development efforts to improve individual, group, and organizational effectiveness.
 Human resource management (HRM) deals with procurement, development, compensation, mainte-
nance and utilization of human resources. HRD deals with efficient utilization of human resources
and it is a part of HRM.
Other resources remain inactive unless there are competent people to utilize the available resources
for the production of goods and services.  Human brain has a limitless energy to think and act in a
productive way. Hence, competent and qualified human resource is a key factor of organizational
success. In this regard, the emergence of human resource development (HRD) plays a vital role in
enhancing the entrepreneurial skill of people.

Human Resource Development (HRD) is a process of developing skills, competencies, knowledge

and attitudes of people in an organization. The people become human resource only when they are
competent to perform organizational activities. Therefore, HRD ensures that the organization has
such competent human resource to achieve its desired goals and objectives. HRD imparts the
required knowledge and skill in them through effective arrangement of training and development
programs. HRD is an integral part of Human Resource Management (HRM) which is more
concerned with training and development, career planning and development and the organization
development. The organization has to understand the dynamics of HR and attempt to cope with
changing situation in order to deploy its HR effectively and efficiently. And HRD helps to reach this
target.

Human Resource Development (HRD) is the framework for helping employees develop their
personal and organizational skills, knowledge, and abilities. Human Resource Development includes
such opportunities as employee training, employee career development, performance management
and development, coaching, mentoring, succession planning, key employee identification, tuition
assistance and organization development.
Human resources development is, regarded as facilitating the development of national human
capacities to achieve sustainable, inclusive, equitable development and, at the same time, enhance
well-being of individuals.  As such, human resources development strategies are increasingly part of
national development planning, and are crucial to enlighten policy.

It also focus in vital areas, such as population, health, nutrition, water, sanitation, housing,
communications, education and training, science and technology, and employment.  Conscious
efforts should be made not to confine these dimensions of human resources development in separate
ministries. Human resources development also has respect for fundamental human rights, the rights
of workers, and occupational safety and health considerations. 
Fulfillment of basic needs and welfare including a decent living or high level comforts, leisure and
self-actualizing opportunities. Freedom to choose one’s representative in the political system and
freedom of expression may be benefits for others.

Human resource can mobilize other resources like land, technology, capital etc. The real wealth of a
nation is its human resource. HRD help economic development of organization and even of country.

HRD includes
 Acquisition- Recruitment and selection
 Development- Training and development/ empowerment/ social interaction/ performance appraisal/
career and succession planning
 Motivation- Job satisfaction/ Grievance/ participation/ job rotation and enrichment/ counseling /
organizational
 Maintenance- compensation/ Working Environment
 Utilizing- Appraisal/ Job description
 Socializing- after retirement.
Natural Resources a n d Development
Resources which are found free of cost by nature are called natural resources. Man can use them for
their daily needs and for further advantage. Air, animal, coal, fuel, stone, minerals, forest, land, soil,
water, solar, vegetation etc. are the example of natural resources.
Availability of natural resource is directly related to the wealthiness of particular country. Country
should has the capacity of using natural resources in efficient way. Natural resource can be used for
raw material for most of the product.

Advantage:
 Source of energy
 Provide raw material for industries
 Environment friendly development
 Environmental protection
 High choice, self-sustained, self-dependent
 Promote industrial development
 Development of Transportation- land/sea
 Infrastructure development
 New industries like tourism herbal can be establish
 Creation of employment
 Source of foreign currency
 Help to initiate and support development
 Modernization of the economy.

Cause of low utilization of Natural resources in UDCs

 Low level of technology
 Lack of infrastructure to exploit resources
 Lack of study and research
 Lack of investment
 Lack of political willingness
 Limited domestic market and low purchasing power of people
 Corrupted government, inefficient administration and management problem
 Rigid value, institution and confined interest of owners of natural resources
 Weak government policy
 Weak economic development to attract foreign investment

Technology a n d Development
Technology is a great tool for development. Development in skill, uses of new raw material, huge
uses of machinery etc are the indicator of technology. If technology is used the pace of development
can be increased. Development of technology is directly related to economic development.
Technology increase the efficiency of production. Technology increase productivity, reduce
investment and help for industrialization.
Technological change comprise of creation of skill, new means and methods of production, new uses
of raw materials and wide spread use of machinery.

Advantage:
 Industrialization
 Increase productivity
 Increase in export
 Increase the quality of product.
 Increase in per capita income
 Improvement in life standard
  Reduce cost of production.
 Remove the scarcity of natural resources.
 Acceleration economic growth and development
 Better utilization of available resources is possible
 Increase the efficiency o factor of production
 High level high quality and mass production is possible

Problem in technology development

 Lack of suitable social and institutional environment
 Lack of efficient administrative set up
 Lack of skill HR
 Lack of managerial and entreprenual skill
 Lack of infrastructure
 Lack of research and study
 Inappropriate social and political environment
 Social stagnation,
 Costly capital intensive technique
 Adverse and rigid culture and value,
 Dearth of infrastructure and capital deficiency
 Problem of choice o technology
 Traditional technology of production is integrated with their value, culture and religion so
they are not willing to change

Values, Institutions and development

An institution means the way of ritual of living mutually which are established, accepted and
arranged by the force of the community. A social institution is a structure that is organized to meet
the needs of people chiefly through the well established procedure.
If the value of any country is good, that country can achieve development easily. Respect to work,
importance of time and money are some of the good values.
If any country is economically poor it is because of it is socially and politically backward. If any
country is religiously, culturally and socially fundamentalist than that country can’t achieve the
development. Economic development or its deficiency primarily result due to variation in tendencies,
customs, tradition and their own political social and religious attitude.

Max Weber, the German social scientist writing in the early 20th century, offered more specific
insights into how cultural or even religious values could impact on economic output. He argued that
the Protestant work ethic, supported by Reformation teachings that the pursuit of wealth was a duty,
inculcated the virtues needed for maximum economic productivity. For this reason, Protestants were
more productive than Catholics throughout Europe-just think of Germany and Great Britain, for
instance, compared to Ireland, Spain, Portugal and Italy in his day.

Effect of Values, Institutions in development in less development country

 Right of private property- accelerate development
 Religious tradition- protestant are personnel, logical so developed. Some other spend more
time and money in religion
 Attitude toward work- conditional
 Caste system- conflict and backwardness
 Joint family system- lazy and costly
 Law of inheritance- lazy
Institution and value should be:
 Develop the habit of taking risk
 Develop the economic activities
 Develop the habit of Saving, investment, capital formation, expenses
 Develop the attitude of respect job
 Help in working habit and industrialization
 Remove cast, religion, myth system
 Adopt the new technology
 Make the people materialist so that they earn and spent more
 Motivate for development

Civil Society and development

The group of people who are gathered voluntarily for some common goal or interest are called civil
society. This are apolitical and non-profit organization. But they can work as pressure group for
political, economic and social cause. They fulfill the gap between government and people. They can
be involved in development work and also work as a referee for fair and transparent work.

Civil society is the realm of organized social life that is voluntary, self-generating, (largely) self-
supporting, and autonomous from the state, and bound by a legal order or set of shared rules. It
consists of a vast array of organizations, both formal and informal, including interest groups, cultural
and religious organizations, civic and developmental associations, issue-oriented movements, the
mass media, research and educational institutions, and similar organizations. 

Aid to civil society is becoming an increasingly important part of the development agenda. Located
in the space between the family and the state, and promoting coordinated public action among their
members and other citizens, civil society organizations have been celebrated most often for their role
in promoting and protecting democracy. Increasingly, however, their contribution to economic
development and poverty reduction are also being acknowledged and supported.

Civil society is a concept denoting a set of non-political relations in society: economic, social, moral,
religious, national, and others. Civil society is a sphere of self-realization of free citizens and
voluntarily formed associations and organizations, protected by relevant laws from direct
interference and arbitrary regulation of activities of these individuals and organizations by the
government.

Civil society is one of the most important value and culture-forming phenomena of modern society.
Civil society in its generally accepted sense, acts as a set of social  formations (groups or teams),
joined together by specific interests (economic, ethnic, cultural, etc.), implemented beyond the
government activity area and allowing, in conditions of a democratic system of social life
arrangement, to control actions of state authorities as hierarchies of power and political institutions.
A state, deprived of inner freedom of public relations and not supporting the democratic regime of
social life, and not developing the value of legality, freedom and democracy, does not have the
privilege to develop on the basis of beneficial initiatives, innovations, and energy of civil society. For
under the conditions of totalitarianism or even limited democracy civil society is, if possible, rather
in the context of the element of resistance - a combination of illegal social movements.

Functions of civil society organizations:

 Articulating citizens' interests and demands;
 Defending citizens' rights; and
 Providing goods and services directly, without recourse to state agencies.
They can be helpful in development by working as:
 Analyst of local need and demand
 Catalyst for empowerment
 Distributor of collective achievement,
 Supporter by pressure group,
 Partner of government, private sector and civil society
 Harmonizer between people and government
 Helper of priority determination, aim indicating, service distribution, public awareness,
 Represent of weak community.
 Vehicle for mobilization of local resources

Safety Nets
Social Safety Nets are programs that help the poorest and most vulnerable people stay out of extreme
poverty. SSN are non-contributing transfer designed to targeted poor and vulnerable people. It is also
called social assistance or social transfer.
Social safety nets, or "socioeconomic safety nets", are non-contributory transfer programs seeking to
prevent the poor or those vulnerable from vicious circle of poverty . Safety net programs can be
provided by the public sector (the state and aid donors) or by the private sector (NGOs, private firms,
charities and informal household). 

Safety nets are part of a broader poverty reduction strategy interacting with and working alongside of
social insurance; health, education, and financial services; the provision of utilities and roads; and
other policies aimed at reducing poverty and managing risk.

The social safety net is a term used to describe a collection of services provided by the state or other
institutions such as friendly societies, including welfare, unemployment benefit, universal
healthcare, homeless shelters, and sometimes subsidized services such as public transport, which
prevent individuals from falling into poverty beyond a certain level.
A practical example of how the safety networks would be a single mother with several children,
unable to work. By receiving money from the government to support her children, along with
universal health care and free education, she can give her children a better chance at becoming
successful members of society, rather than be caught up in the hopelessness of extreme poverty.

Four important role:

 SN redistribute income to the poorest most vulnerable, with an immediate impact on poverty
and inequality
 SN enable household to make productive investment in their future that they may otherwise
miss education, health, income generating opportunity
 SN help household manage risk at least offsetting harmful coping strategies and at most
providing an insurance function which improve livelihood option
 SN allow government to make choice that support efficiency and growth.

Various form of SN:

 Cash transfer- Needs-based assistance programs /Family allowances
 Conditional cash transfer
 Food based program- School feeding programs /Food for work (FFW) programs 
 Price subsidies - electricity, public transport, energy and utilities etc.
 Public work
 Fee waiver, exemption and scholarship- school supplies and uniforms, health care,
schooling and utilities 
 General subsidies
Limitation:
 Wrong beneficiary
 May exclude real needy candidate
 May increase prize
 Limit consumer choice
 Larger administrative cost

Some SN work done by Nepal

 Monthly allowance to elderly citizen, single women and physical handicapped person
 Monthly subsistence allowance to martyr family and inured
 Intensive program for farmers and poor people
 Subsidy for energy like bio gas, solar, micro-hydro and petroleum product.
 School feeding, scholarship and training.
 School feeding