Beyond independence in 1971 and restoration of democracy in 1991, Bangladesh witnessed the biggest achievement as Professor Muhammad Yunus and his Grameen Bank were declared the Nobel Peace Prize 2006 on October 13 for pioneering the use of micro-credit to benefit poor entrepreneurs. He is the first Bangladeshi and the third Bangalee after poet Rabindranath Tagore and economist Amartya Sen to win the Nobel Prize. On the other hand Grameen Bank which was founded by Prof Yunus has been instrumental by offering loans to millions of poor Bangladeshis, many of them women, without any financial security, in improving their standard of living by starting businesses with the tiny borrowed sums. This Bank has issued more than US$ 5.1 billion to 5.3 million borrowers. To ensure repayment, the bank uses a system of "solidarity groups". These small informal groups apply together for loans and its members act as co-guarantors of repayment and support one another's efforts at economic self-advancement. As it has grown, the Grameen Bank has also developed other systems of alternate credit that serve the poor. In addition to microcredit, it offers education loans and housing loans as well as financing for fisheries and irrigation projects, venture capital, textiles, and other activities, along with other banking services such as savings.
"Lasting peace cannot be achieved unless large population groups find ways in which to break out of poverty. Micro-credit is one such means," said Ole Danbolt Mjøs, chairman of the Norwegian Nobel Committee. "Muhammad Yunus has shown himself to be a leader who has managed to translate visions into practical action for the benefit of millions of people, not only in Bangladesh, but also in many other countries."
Prof Yunus and Grameen Bank were chosen for the prestigious award from among 191 candidates, including 168 individuals and 23 organisations.
Yunus, dubbed "Banker to the Poor", began fighting poverty during a 1974 famine in Bangladesh with a loan of $27 out of his pocket to help 42 women buy weaving tools to save them from the clutches of the moneylenders. "They got the weaving tools quickly, they started to weave quickly and they repaid him quickly," said Mjos.
"Yunus and Grameen Bank have shown that even the poorest of the poor can work to bring about their own development," the Nobel Committee said in its citation.
In his instant reaction, the pioneer of the micro-credit concept said, "This is fantastic news for all of us--for Grameen Bank, Bangladesh, and all the poor countries and all the poor people around the world."
Recipient of numerous national and international awards, Prof Yunus termed the Nobel achievement "the sky", but said it also "burdened us with further responsibility. Bangladesh now must remove poverty from the country and also put in more efforts to eradicate poverty from the world."practice.
"This is an honour for the country, for the nation...This kind of incident does not happen often to a nation," Prof Yunus said, thanking the Almighty.
"We [Bangladeshis] have taken many things from the world, now we have given something to the world. We have placed a model before the world," he added.
"Now I dream of Bangladesh as the first country to be freed from hunger," he said.
Asked if the prize is appropriate for peace, Dr Yunus said, "I was not astonished to get the Nobel Prize for peace because economics and peace are interrelated--economics influences people's life.
"Hunger is one of the main reasons of anarchy. If poverty can be reduced from the society, peace will prevail on earth," he added.
Dr Yunus said, "I will not spend the prize money for myself...I will rather spend it in social business on a no-profit-no-loss policy. We will also establish an eye hospital where even beggars will be given treatment at the cost of Tk 10-20.
"We will make yogurt with all kinds of nutritious elements. We want to provide nutrition to the poor and children," Prof Yunus said figuratively.
In the field of development idea, Nobel Prize for Professor Muhammad Yunus was long overdue and it is in recognition that the country has something to offer to the world, top economists, researchers and business leaders observed.
Muhammad Yunus, the visionary and developer of the unique microcredit concept, was born at an obscure village in Chittagong in June 28, 1940.
He was the third of 14 children of Sufia Khatun and Mohammed Dula Miah, a jewellery merchant. But five siblings of Yunus died in infancy.
The Grameen Bank, which Muhammad Yunus founded and shared the Nobel Peace Prize 2006 with, now has 2,211 branches covering 70,370 villages and 6.5 million people.
Yunus is now leading a happy life in Bangladesh with his wife Mrs Afrozi and daughter Deena.
Coming of a well-off family, Yunus was able to attend preparatory school in Chittagong. After that, he studied in Chittagong Collegiate School and Chittagong College. He completed his BA and MA from Dhaka University.
He received his PhD in Economics from Vanderbilt University in 1969 after getting Fulbright scholarship. He did some teaching in Colorado University too.
Towards the end of his seven-year stay in US, Yunus supported the Bangladesh's freedom struggle. Returning to Bangladesh and observing the poverty of rural people in the clutches of exploitative moneylenders, Yunus came up with the idea of microcredit.
After staying seven years in Bangladesh, he joined Chittagong University as a professor of economics.
Yunus first involved himself in fighting poverty during the 1974 famine in Bangladesh. Yunus discovered that very small loans could make a significant difference to a poor person's ability to survive.
The first loan he gave was of $27 from his own pocket. He lent it to 42 female basket weavers in the village of Jobra near Chittagong University. He discovered that they could repay the amount very quickly by selling their goods in the market.
Before this, they used to take loans from village loan-sharks with high interest rates. In some cases, the interest rates stood at a staggering 10 per cent a week.
However, banks were not interested in giving tiny loans to poor people and they considered the poor to be bad borrowers.
In 1976, Yunus launched the activities of Grameen Bank and started giving loans to poor Bangladeshis against the advice of banks and the government. He carried on giving out micro-loans and in 1983, he officially formed the Grameen Bank, meaning village bank, on the principles of trust and solidarity.
The Grameen Bank's method of giving out loans is now used in projects in 58 countries, including the US, Canada, France, the Netherlands and Norway.
In 1997, Professor Yunus led the world's first microcredit summit in Washington, DC.
Dr Muhammad Yunus received over 60 different national and international awards before winning the Nobel Peace Prize this year.