Bangladesh was termed as a basket case. However, its development experience during the last three decades is a mixed one. On socio-economic performances, its achievements are outstanding, and better than its neighboring countries. Its annual growth rate is lower than India, yet, it has been surprisingly good at improving the lives of the rural poor. But, its political culture seemingly appears to be a dysfunctional democracy. The obvious question is, despite a comparatively lower annual growth rate, and dysfunctional democracy, how the so called “development basket case” has managed a disproportionate poverty reduction for its amount of growth? Interpreting the findings of a number of studies, this paper relates such a development with the social organization of the economy with a strong rural connection on two major dimensions: a. increased agricultural production; and b. small scale business activities. The combined effects of both these rural economic activities are the increased income of rural household, increased enrolment in educational institutions of the rural poor, female students in particular empowering women. It is beyond the scope of this paper to go into detail of all dimensions. It rather discusses (based on the preliminary findings of a study) what role small scale economic activities played in the process. The positive role of small loans is recognized however, as the findings suggest, such loans are not a panacea for macroeconomic growth. Small loans, microcredit, made contributions to the welfare of the poorest of the poor, the rural women, through providing possible means by which they gained control of their economic life. This achievement, in turn, exerted pressure for social change that included child education, women's participation in the economy and politics. There are also cases of borrowers left worse off. The varied effect, apparently, is due to structures of network relations. Theoretical discussion, therefore, includes a reassessment of how NET (Network Embedded Trust) works including the concept of social capital. It is suggested that the concept should be oriented to broader power structures, which remained neglected in existing studies.