Q&A: Rockefeller's Ashvin Dayal on inclusive growth

Devex
By Abigail Seiff

Ashvin Dayal, associate vice president and managing director for Asia at the Rockefeller Foundation. Photo by: Benedikt von Loebell / World Economic Forum / CC BY-NC-SA

In late 2013, the Asian Development Bank and the Rockefeller Foundation launched the Urban Climate Change Resilience Trust Fund. Since then, the $160 million fund — supported by the United States, the United Kingdom, and Switzerland — has helped mitigate the effects of climate change in cities across Asia.

Funding goes to programs that range from preventing erosion in Hội An, Vietnam, to waste management and urban planning in Mandalay, Myanmar, to lessening the impact of flooding in Sahiwahl, Pakistan — all with the aim of mitigating the impacts of climate change within some of the most vulnerable cities on earth.

Projects such as the UCCRTF are key to ensuring inclusive development, says Ashvin Dayal, associate vice president, managing director, Asia at the Rockefeller Foundation.

“The idea there was to set up a facility that allowed us to develop large infrastructure projects. But to do that with resilience of communities and of places in mind,” he told Devex in an interview.

Dayal believes there is increasingly room for complementarity — ways in which large infrastructure development can be built in a manner that helps the poorest communities. Devex talk to him about inclusive development and how to make economic growth reach the last mile. This interview has been edited for length and clarity.

Can large-scale infrastructure development and inclusive development go hand in hand? Or do we need a new model of growth and development?

I think that they can go hand in hand. The key is how do you make sure that the large infrastructure projects that are being implemented by the bank or anyone else are complimentary with communities who are perhaps less able to use those infrastructures. Are they complementary to their needs? So what we talk a lot about is how do you combine infrastructure with decentralized small infrastructure.

To give you an example: In the energy field that we do a lot of work in, we know that governments and development banks have to invest heavily in the grid infrastructure to expand the grid to provide more electrification through the grid. But we also know that if we’re going to reach the last mile, we’re going to have to have a different kind of decentralized service that can get to the poorest communities who aren’t going to be able to connect to the grid for maybe five, 10, or 15 years in some cases

So I think when infrastructure is planned with those complementarities in mind then absolutely it is a driver for economic growth. The issue is that we want more than just growth. We want equity, we want inclusion, we want stability, we want access and participation for all communities, and that’s where I think some of the big infrastructure projects of the past have maybe fallen short.

Tell me about the UCCTRF and the impact it has.

The idea was to set up a facility that allowed us to develop large infrastructure projects, but to do that with resilience of communities and of places in mind. The facility has about $150 million that provides project development funding and grant funding to ADB country teams to do more of that up-front planning when they’re developing that urban infrastructure. That lets them make sure that their project is resilient and that it’s inclusive. Say you’re doing a water infrastructure or a transport infrastructure project — the fund allows it to be designed with these issues in mind. It’s been a really powerful partnership. It took a long time to get it going, but it’s been extremely beneficial to communities that those projects are being implemented in.

How does that partnership work?

We’re talking about small project development grant funding. The ADB, at the end of the day, is making very large infrastructure loans. So they’re bringing in big finance. So it’s that complementarity that works really well. They do two things. One is they host the facility, they manage the facility, they manage the funds and what they do is they link these small grants which are these planning grants to the development of the bigger loans that are going to be coming down the pipeline.

So they may be doing a $500 million transportation loan in a city in Asia. The question is: Can we use a couple million at the start to design it differently, to be more resilient, to think more about how low income communities are going to benefit from that, to think about how it might be able to provide more protection to vulnerable communities? When you put those two things together — the big finance for infrastructure with that upfront project planning you actually get much more inclusive and resilient outcomes as a result.

Why cities?

If you think about it, the world is now predominantly urban, and it’s where we’re going to see the largest growth of population in the next 20 to 30 years. We’re going to see something like 75 percent of the world being urban by 2050. At the same time, these cities are growing very fast in a context of greater volatility. If you just look at climate, the kinds of shocks and stresses the cities are facing today are so different than even 20 years ago. You have so many coastal cities in Asia that face the risk coming from cyclones, typhoons, flooding, etc., and that’s setting back a lot of the development gains that these places have made. So we believe that now is the time for cities to really be the focus of where we invest in resilience, because there’s so much to lose there. That’s where you got the most people, the most economic assets and the most sort of human impact that could be felt over the decades ahead.

Apart from the UCCRTF, what are some other complementary initiatives that Rockefeller is working on?

About three years ago our board approved something called the Smart Power for Rural Development Initiative. It’s really aimed at creating more access for electrification for rural communities. Globally, there are about 1.3 billion people who don’t have access to reliable electricity. And in 2017, that’s really outrageous if you think about it. Part of the reason why, is it’s very difficult to extend the grid infrastructure in a conventional way to every remote village or hamlet in places like North India or parts of Africa, where you have the real concentrations. So we found with the price of solar technology coming down and new business models around decentralized mini-grids, that there’s a new opportunity to bridge this gap.

We launched this effort in 2014, with a goal to develop 1000 minigrids, and electrify 1000 villages. But the real goal of that is to show there is a different way to achieve universal electrification. So we’re working very closely with governments, but we’re also bringing in companies and NGOs who need to then work on engaging with the communities to test and develop and scale up this new model. We’ve got about 115 minigrids in India and we’re starting to explore what we can do in East Africa as well as other places such as Myanmar.