IX Economics Chapter – 3 Poverty as a Challenge

IX Economics Chapter – 3

Poverty as a Challenge

                                                                                                      

 

Poverty is one of the most difficult challenges before India  It is a major roadblock in the growth of our country .More than quarter of the Indian population is living under the poverty line .

 

Estimating the poverty line

 

A person is said to be poor if his or her income or consumption level falls below a given‘‘minimum level’’ necessary to fulfill basic needs.

Each country uses an imaginary line that is considered appropriate for its existing level of development and its accepted minimum social norms.

For estimating the poverty line, a minimum level of food requirement, clothing, footwear , fuel and

light, educational and medical requirement etc. is determined for subsistence.

 

(i) Consumption method

The calorie requirement depending upon the age, sex, area and type of work is the wayof estimating poverty. Average calorie requirement in India is 2400 per person per day in rural areas and 2100 per person per day in urban areas.

 

(ii) Income Method

Monetary expenditure per capita needed for buyingthese calorie requirements in terms of

food grains etc is also a way of estimating poverty. In the year 2000, poverty line for a person was fixed at Rs 328 per month for the rural areas and Rs 454 for the urban areas. For the year 2009-10, the poverty line for a person was fixed at Rs 673 per month for

the rural areas and Rs 860 for the urban areas.

2011 – 12 – 1000 Rs.  urban

Rural 816 -  rural areas

 

(iii) Uniform method

A uniform standard for poverty line is also used, which is given by international organisations like World Bank. This is equivalent of $ 1 per person per day.

 

The poverty line is estimated periodically by conducting sample surveys. These surveys are

conducted by National Sample Survey Organisation ( NSSO ).

 

Social indicators

Usually the indicators used to identify poverty are the levels of income and consumption.

But now poverty is looked through other social indicators like illiteracy level, lack of general resistance due to malnutrition, lack of access tohealthcare, lack of job opportunities, lack

of access to safe drinking water, sanitation etc.

Different poverty lines

Poverty is found in different countries in various dimensions. Its nature and extent also varies from time to time

and region to region. Different countries adopt different levels of poverty lines because of the following reasons:

a)  Existing level of development in different countries.

b)  Every country has its own accepted minimum social norms.

 

 

Poor in the rural areas

 

In the rural sector, the poor include farm labourers, small and marginal farmers, rural artisans, backward classes and backward tribes. They lack basic literacy and skills. They are unable to find alternative employment elsewhere. They generally become victims of village moneylenders.

 

Poor in the urban areas

In the urban sector, the poor consist of rickshaw-pullers, cobblers, street vendors, petty self- employed persons, domestic servants and low-paid workers working in factories or in other occupations.

They reside in poor localities where the conditions of living are very poor.

 

Features of Poverty in India:

 Following are the main features of poverty in India.

 

    (1) Declining Trend :

The proportion of people below poverty line in India had variations.

Poverty ratio increased during the decade of the 1970s. It decreased sharply during the decade of the 1980s. During the decade of 1990s, there was first a rise following the period of economic reforms and then a fall in the incidence of poverty. Since 1993-94, the total number of the poor shows a declining trend.

There is substantial decline in poverty ratios in India from about 55 per cent in 1973 to 30 per cent in 2009-10. The proportion of people below poverty line further came down to about 26 per cent in 2000. every fourth person in India is poor. This means, roughly 300 million (or 30 crore) people in India live in poverty.

 

 

(2) Inter-State Variations :

Poverty is not equally distributed through the country. A recent study shows that more than 90 per cent of India’s rural poor live in the states of Andhra Pradesh, Orissa, Bihar, Madhya Pradesh, Karnataka, Maharashtra, Rajasthan, Tamil Nadu,Uttar Pradesh and West Bengal. Further, 50 per cent of India’s rural poor live in three states (namely, Bihar, Madhya Pradesh and Uttar Pradesh). As against this, the poverty ratio in the states of Jammu and Kashmir, Gujarat, Kerala, Punjab and Haryana is quite low.

 

(3) Nature of Poverty:

*Poverty is visible both in our rural and urban areas. The rural poor consist of people of low castes and tribal groups. The major group of the poor include landless agricultural labourers, small and marginal farmers, rural artisans, etc.

*In the urban sector, the poor include largely unemployed, underemployed or persons employed

in low productivity occupations such as rickshawpullers, cobblers, street vendors.

 

Global Poverty Trends :

 

The proportion of people in developing countries living in povertyhas declined from 28 per cent in 1990 to 21 per cent in 2001. Although there has been a substantial reduction in global poverty, there are great regional differences visible. Poverty has substantially fallen in China and South-East Asian countries.

The number of poor in China has drastically come down from 606 million in 1981 to 212 million in 2001. But the decline inpoverty in India, Pakistan, Sri Lanka, Nepal, Bangladesh, Bhutan has not been so rapid.

Despite decline in the poverty ratio, the number of poor has declined marginally from 475 million in 1981 to 428 million in 2001. However, in Sub-Saharan Africa, poverty rose from 41 per cent to 46 per cent during the same period.

 

Major reasons for poverty in India.

1.Low level of economic development under British Government.

2.  High Growth of Population – inflation - une

3.Unequal Distribution of Land , income and Other Resources

Huge income inequalities makes it difficult for the government policies to implement properly for poverty elimination. Therefore income inequality is a major cause of poverty in India.

4. Socio-Cultural and Economic Factors.

5. Illiteracy

6. Unemployment

 

 

 

7.  Low level of economic development under British Government. One historical reason for widespread poverty in India is the low level of economic development under the British colonial administration.

The policies of the British Government discouraged the development of industries like textiles , handicrafts etc. this resulted in low rate of economic growth which further lessened job opportunities and growth of incomes.

 

8. High Growth of Population. The cycle of poverty was further perpetuated by high growth rate of population. Failure to control population reduced the growth rate of per capita income.

 

9.Unequal Distribution of Land and Other Resources. Land and other resources are not well distributed among people living in rural and urban areas. Major policy initiatives like land reforms have not been implemented in an effective manner by most of the state governments.

 

10.Socio-Cultural and Economic Factors. In order to fulfil social obligations and observe religious ceremonies, people in India, including the very poor spend a lot of money. Small farmers need money to buy agricultural inputs like seeds, fertilizers, pesticides.

 

 Poor Public facilities lack of medication facilities

Lake of government

Inflation

 

 

 

 

 

Illiteracy is responsible for poverty

 

Illiteracy is responsible for poverty in India as it causes the vicious circle of life where a poor

remains poor. Educated parents teach their children and make them more productive towards the economic growth. They are more conscious about the education, health and hygiene of their children.

 On the other hand, illiterate parents are not aware and conscious about providing better education, health and hygiene facilities to their children.

Thus they do not look for other occupational facilities other than traditional one, therefore remain poor.

 

Anti-poverty strategy

 

The current anti-poverty strategy of the government is based mainly on two planks:

 

a)  Promotion of economic growth :

 A major cause of poverty in India has been slow rate of growth of the economy. A fast growing economy turns out increasing amount of goods and services every year, generates higher incomes and provides greater employment opportunities. If income distribution remains unaltered, the poor will share this increased income through greater employment and more job opportunities.

 

Thus there will be some improvement in the poor masses and incidence of poverty will be reduced. There is a strong link between economic growth and poverty reduction.

 

b)  Targeted Anti-Poverty Programmes : In view of the growing magnitude of poverty and unemployment in spite of reasonable , though not high, growth rate achieved during the first three decades of planning, special programmes were designed and implemented to make a direct attack on poverty. Some antipoverty measures are as follows:

 

v NATIONAL RURAL EMPLOYMENT GUARANTEE ACT (NREGA) 2005 **

v NATIONAL FOOD FOR WORK PROGRAMME (NFWP), 2004**

v PRIME MINISTER ROZGAR YOJNA (PMRY), 1993**

v RURAL EMPLOYMENT GENERATION PROGRAMME (REGP), 1995**

v SWARNJAYANTI GRAM SWAROZGAR YOJNA (SGSY), 1999**

v PRADHAN MANTRI GRAMODYA YOJNA (PMGY), 2000**

 

Further, three major programs have been  launched  to improve the  nutritional status of the poor:

*  Public Distribution System

*Integrated Child Development Scheme

*Midday Meal Scheme

 

Some other programs launched for the better of the people in rural areas are:

o  Pradhan Mantri Gram Sadak Yojana

o  Pradhan Mantri Gramodaya Yojana, and

o  Valmiki Ambedkar Awas Yojana

 

 

 

 

NREGA

 

National Rural Employment Guarantee Act, 2005 was passed in September 2005 with thefollowing features :-

(i) It provides 100-days assured employment every year to every rural household with the reservation for one-third of the proposed jobs for women.

(ii) The central government will establish a National Employment Guarantee Fund for Women

and state governments will establish State Employment Guarantee Funds for implementation of the scheme.

(iii) If an applicant is not provided employment within 15 days, he/she will get dailyunemployment allowance.

 

Evaluation  of poverty alleviation programmes

 

POSITIVE SIDE : The incidence of poverty has declined. In the year 1973, about 55% of the Indian population was poor. At present the poverty ratio has come down to 26%.

 

NEGATIVE SIDE : Though  a  number  of  poverty  reduction  programs  have  been  launched  by  thegovernment  the  outcome  has  not  been  satisfactory  enough.  There  are  many  areas,  which are  facing segregation and are being  deprived of basic development Poverty still remains one of the major challenges of our country. About 1/4^Th  of the total population still remains poor. .  The reasons  for the underperformance of these programs are:

1)  Lack of proper targeting.

2)  Lack of proper implementation ( Poor execution )

3)  Non-delivery of benefits to targeted groups.

4)  Overlapping of schemes.

5)Systemic corruption

6)Unequal distribution of land and wealth

7)Pressure from the local elite

8)Lack of participation by the poor people, etc.

 

 

Effects of poverty

 

Higher infant mortality

Higher illiteracy rate

Violence Terrorism corruption

Child labour

 

Lacking basic facilities

poor health conditions illness

Lower income and status of living

Hunger and malnutrition

Helplessness

Crime rate

Home lessness

 

Measures to reduce poverty

 

1)  More industrialization. In order to remove poverty and unemployment, both in rural and urban areas, there is a need to set up more and more industrial units.

 

2)  Improvement in agriculture sector. Besides initiating institutional and technological reforms, there is a

need to provide land to the actual tiller of the land.

 

3)  Promotion of education. Education widens the opportunities of an individual to take up jobs and earn a livelihood for himself.

 

4)  Promotion of economic growth. Economic growth creates more opportunities and provides more resources which are quite essential for human development. This also encourages people to send their children to schools in the hope of getting better economic returns by investing in their education.

 

5)  Improvement in the implementation of anti-poverty programmes. Proper targeting and delivery of benefits to the targeted groups should be done.

6)  Reduction in the rate of population growth.

7)  we  need  to  encourage and educate people to participate from the grass root level.

 

 

Measures to reduce regional poverty :

Several states of India like Orissa, Bihar, Madhya

Pradesh, Uttar Pradesh, Nagaland, etc., are economically very poor. To remove this regional

poverty the following measures may be suggested :

(a) More Central assistance and grants should be given to backward states.

(b) Special concessions may be given for investments in backward areas.

(c) Public sector enterprises should be set up in backward states.

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Work sheet

1.    What is poverty? Describe how poverty line is estimated in India.

2.    Discuss the major reasons  for poverty in India.

3.    Why do different countries use different poverty lines?

4.    Describe the current government strategy of poverty alleviation.

5.    Mention the positive and negative aspects of poverty alleviation programmes in India.

6.    Mention a few measures to reduce poverty.

7.    Identify the social and economic groups which are most vulnerable to poverty.

8.    Give an account of inter-state disparities in poverty in India.

9.    Mention any three features of the National Rural Employment Guarantee Act, 2005.

10. Explain how poverty begets more poverty.

11. Explain how the low level of education can be held responsible for poverty in India.

12. Suggest some measures to reduce regional poverty.

13. Give brief account of inter-state disparities of poverty in India. [CBSE 2010]

14. How is the regular growth of population one of the major causes of poverty?

15. How the policies of colonial government were responsible for poverty in India?

16. Explain the principal measures taken in Punjab, Kerala and Andhra Pradesh to reduce poverty.

17. ‘‘In poor families all suffer but some suffer more than others.’’ Explain.

18. What is poverty line? Give the income for poverty line fixed for the rural and urban areas in India .

19.  ‘There is a strong link between economic growth and poverty reduction.’’ Explain.

20. How can poverty be reduced in future in India? Suggest any four points.

21. Mention the two planks on which the current anti-poverty strategy of the government is based. Why were the poverty alleviation programmes not successful in most parts of India?