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Poverty in India

According to a recent Indian government committee constituted to estimate poverty, nearly 38% of India’s population (380 million) is poor. This report is based on new methodology and the figure is 10% higher than the present poverty estimate of 28.5%.

The committee was headed by SD Tendulkar has used a different methodology to reach at the current figure. It has taken into consideration indicators for heath, education, sanitation, nutrition and income as per National Sample Survey Organization survey of 2004-05. This new methodology is a complex scientific basis aimed at addressing the concern raised over the current poverty estimation.

Since 1972 poverty has been defined on basis of the money required to buy food worth 2100 calories in urban areas and 2400 calories in rural areas. In June this year a government committee headed by NC Saxena committee estimated 50% Indians were poor as against Planning Commission’s 2006 figure of 28.5%.

Poverty is one of the main problems which have attracted attention of sociologists and economists. It indicates a condition in which a person fails to maintain a living standard adequate for his physical and mental efficiency. It is a situation people want to escape. It gives rise to a feeling of a discrepancy between what one has and what one should have. The term poverty is a relative concept. It is very difficult to draw a demarcation line between affluence and poverty. According to Adam Smith - Man is rich or poor according to the degree in which he can afford to enjoy the necessaries, the conveniences and the amusements of human life.

Even after more than 50 years of Independence India still has the world's largest number of poor people in a single country. Of its nearly 1 billion inhabitants, an estimated 260.3 million are below the poverty line, of which 193.2 million are in the rural areas and 67.1 million are in urban areas. More than 75% of poor people reside in villages. Poverty level is not uniform across India. The poverty level is below 10% in states like Delhi, Goa, and Punjab etc whereas it is below 50% in Bihar (43) and Orissa (47). It is between 30-40% in Northeastern states of Assam, Tripura, and Mehgalaya and in Southern states of TamilNadu and Uttar Pradesh.

Poverty has many dimensions changing from place to place and across time. There are two inter-related aspects of poverty - Urban and rural poverty. The main causes of urban poverty are predominantly due to impoverishment of rural peasantry that forces them to move out of villages to seek some subsistence living in the towns and cities. In this process, they even lose the open space or habitat they had in villages albeit without food and other basic amenities. When they come to the cities, they get access to some food though other sanitary facilities including clean water supply still elude them. And they have to stay in the habitats that place them under sub-human conditions. While a select few have standards of living comparable to the richest in the world, the majority fails to get two meals a day. The causes of rural poverty are manifold including inadequate and ineffective implementation of anti-poverty programmes.The overdependence on monsoon with non-availability of irrigational facilities often result in crop-failure and low agricultural productivity forcing farmers in the debt-traps. The rural communities tend to spend large percentage of annual earnings on social ceremonies like marriage; feast etc.Our economic development since Independence has been lopsided .There has been increase in unemployment creating poverty like situations for many. Population is growing at an alarming rate. The size of the Indian family is relatively bigger averaging at 4.2.The other causes include dominance of caste system which forces the individual to stick to the traditional and hereditary occupations.

Since the 1970s the Indian government has made poverty reduction a priority in its development planning. Policies have focused on improving the poor standard of living by ensuring food security, promoting self-employment through greater access to assets, increasing wage employment and improving access to basic social services. Launched in 1965, India's Public Distribution System has helped meet people's basic food needs by providing rations at subsidized prices. Although it has affected less than 20% of the Poor's food purchases, the system has been important in sustaining people's consumption of cereals, especially in periods of drought. It has provided women and girls with better access to food and helped overcome the widespread discrimination against female consumption within households. It has also reduced the burden of women, who are responsible for providing food for the household.

The largest credit-based government poverty reduction programme in the world, the Integrated Rural Development Programme provides rural households below the poverty line with credit to purchase income-generating assets. Launched in 1979, the programme has supplied subsidized credit to such groups as small and marginalized farmers, agricultural laborers, rural artisans, the physically handicapped, scheduled castes and scheduled tribes. Within this target population, 40% of the beneficiaries are supposed to be women. Although the programme has reached 51 million families, only 27% of the borrowers have been women. The programme has significantly increased the income of 57% of assisted families.

Rural poverty is largely a result of low productivity and unemployment. The Jawahar Rozgar Yojana, a national public works scheme launched in 1989 with financing from the central and state governments, provides more than 700 million person days of work a year about 1% of total employment for people with few opportunities for employment. The scheme has two components: a programme to provide low-cost housing and one to supply free irrigation wells to poor and marginalized farmers. The public works scheme is self-targeting. Since it offers employment at the statutory minimum wage for unskilled manual labor, only those willing to accept very low wages the poor are likely to enroll in the scheme. By providing regular employment and thereby increasing the bargaining power of all rural workers, the public works scheme has had a significant effect in reducing poverty. It has also contributed to the construction of rural infrastructure (irrigation works, a soil conservation project, drinking water supply). Evaluations show that 82% of available funds have been channeled to community development projects. Targeting was improved in 1996 when the housing and irrigation well components were delinked and focused exclusively on people below the poverty line.

TRYSEM (Training rural youth for self employment) was started to provide technical skills to the rural youth and to help them to get employment in fields such as agriculture, industry, services and business activities. Youth of the poor families belonging to the age-group of 18-35 are entitled to avail the benefits of the scheme. Priority is given to persons belonging to ST/SC and ex-servicemen and about 1/3 seats are reserved for women. Minimum Needs Programme was taken up as an integral part of the 5th Five Year Plan and it was intended to cater to the minimum needs of the people such as rural water supply, rural health, road building, adult education, primary education, rural electrification and improvement of the urban slums etc.With the intention of removing urban unemployment some schemes such as SEPUP (Self-employment programme for the urban poor); SEEUY (Scheme for self-employment of the educated urban youths) .These schemes gives loans and subsidies for the urban unemployed youths to create or to find for themselves some jobs. The SEPUP had provided financial help for about 1.19 urban unemployed youths in the year 190-91.

The participation of civil society organizations in poverty reduction efforts, especially those directed to women, has increased social awareness and encouraged governments to provide better services. Cooperatives such as the Self-Employed Women's Association provide credit to women at market rates of interest but do not require collateral; they also allow flexibility in the use of loans and the timing of repayments. These civil society organizations have not only contributed to women's material well being; they have also helped empower them socially and politically. Such credit initiatives, by bringing women out of the confines of the household, are changing their status within the family and within village hierarchies. The demands of civil society organizations for better social services have spurred the government to launch campaigns to increase literacy and improve public infrastructure. And their calls for greater accountability and real devolution of power are increasing the likelihood that expenditures for poverty reduction will reach the needy, especially women.

The Indian state has undoubtedly failed in its responsibilities towards its citizens over the last 50 odd years. There is a need for the state to move out of many areas and the process has been started with economic liberalization. The process of decentralization should devolute lot more powers, both functional and financial, to panchayats. The lack of transparency and accountability has hampered our economic development at all levels. The problem of poverty persists because of a number of leakages in the system. New laws have to be evolved to ensure more accountability. Bodies like the Planning Commission should be modified into new constitutional bodies that can hold governments accountable for their failure to implement development programmes. A strong system of incentives and disincentives also needs to be introduced. The encouragement of non-governmental organizations and private sector individuals in tackling poverty is imperative, as the state cannot do everything.

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