Background

 After the independence of India’s economic structure has changed dramatically

 Indian Economy got Boom In 1991, When India opened his door to World.
 Privatization, Liberalization & Globalization Taken place.
 Till Then India is going faster than any economy in world.
 India Is standing on the verge of becoming a superpower but it still facing some basic problem
 Poverty is one of them. Benefits of growth not widely spread to various sections in society,
reached only marginally to low income groups.

World bank view → poverty is hunger. Poverty is lack of shelter. Poverty is being sick and not being able
to see a doctor. Poverty is not having access to school and not knowing how to read. Poverty is not
having a job , is fear for the future, living one day at a time
Some important facts
 Every 4th person in India is poor.
 26 crores people in India are poor
 India has the largest poor in the world
 rate of success for poverty reduction is different from state to state, thus causing inter-state
disparities.

Inter-state disparities
 • Poor Orissa, Madhya Pradesh and Bihar are the poorest states of India.
 • Best Punjab, Himachal Pradesh and Jammu and Kashmir are the best states when poverty is
concerned.
Poverty

 Poverty is the deprivation of food, shelter, money and clothing when people can’t satisfy their
basic needs.
 Poverty can be understood simply as a lack of money or more broadly in terms of barriers to
everyday human life. OR
 A state or condition in which a person or community lacks the financial resources and essentials
to enjoy aminimum standard of life and well-being that's considered acceptable in society.

Characteristics of Poor People

 Hunger, starvation & malnutrition - Hunger & starvation are the basic problems of the poorest
households.
  Malnutrition is alarming high among the poor.
 Poor health they are generally physically weak due to ill health disability or serious
 Illness Their children are less likely to survive or be born healthy.
 Limited economic opportunities they have very Limited economic opportunities due to lack of
literacyand skills.
 Debt trapthey borrow from money landless who charge high rate of interest.
 Lack of facilities of electricity & watermost poor household do not have access to electricity.
Their
 primary cooking fuel is fire wood & cow dung cake.

Analysis

 % of poor living below poverty line -→ Declined,

 But absolute number has increased.
 Vulnerability to poverty is the extent to which a community, person, society , country etc. can
be affected
 by the impact of the poverty.
 Women’s, less paid workers + beggars + people living in less developed area, or in slums
 farm + laborers + ST + SC group→ vulnerable to poverty.
 women, children and elderly are the worst sufferers because of poverty
 Poverty Level Across India
 Kerala has the least poverty →15%
 Out of 22 crore households in India, 15.6% earn less than Rs. 45,000 per annum.

Global Poverty Scenario

 % of people living from

 28% in 1991
 21% in 2001; in the developing countries.
 Poverty declined substantially in China and some South Asian countries because of rapid
economic development.
 On the other hand, reduction was not as sharp in countries; like Pakistan, Bangladesh, Sri Lanka,
etc.

Types

1. Relative Poverty
 when we compare the incomes of different people, & we find that some people are poorer
than other , it Is called relative poverty.
 Relative poverty does not consider; how poor the poor persons are or whether he is
deprived of the basis minimum requirement of life or not.
 It compares the inequality of income & assets ownership. It helps in understanding the
relative position of different segment of the populations.
  The defect in the relative measure of poverty is that it only reflects the relative position of
different segment of the population in the income hierarchy.
2. Absolute Poverty
 It refers to the total number of people living below poverty line.
 In poverty line a standard is fixed in terms of minimum level of consumption.
 Absolute poverty refers to a situation when a person fails to reach this minimum
consumption.
 Poverty line is used as a measure.
 The people below poverty line are absolutely poor.

Concept of Poverty Line

 Poverty line is a cutoff point on the line of distribution, which usually divides the population of
the country as poor & non poor.
 People having income below the poverty line are called poor & people with income above
poverty line are called non poor.
 Planning commissiondefined poverty line on the basis of recommended nutritional
requirement of 2400 calories per person in rural areas and 2100 for a person in urban areas.
 While fixing the poverty line, consumption of food is considered as the most important criteria.

Criticism Of Poverty Line

 Poverty Line is a measure based solely on the cost of food.

 There are many factors, other than income & assets, which are associated with poverty, like
accessibility to basic education, health care drinking water etc which have been ignored.
 This method does not consider social factors that generate & are responsible for poverty, like
illiteracy, illhealth, lack of access to resources discrimination or lack of resources discrimination
or lack of civil & politicalfreedom.
 The analytical data is low to find the solution to reduce the poverty It is essential to have the
categories(sex,age etc) what affect from poverty more

Gini Co-Efficient

 The Gini coefficient (also known as the Gini index or Gini ratio) is a measure of differences in
income. It wasdeveloped by the Italian statistician Corrado Gini in 1912.
  The Gini coefficient is usually a number between 0 and 1 (or 0 to 100). 0 means a country where
the income isequally distributed.
 On the other hand, 1 means that one person owns everything but the rest owns nothing.
 In reality, all scores are between 0.25 and 0.6 (between 25 and 60 on the 0 to 100 scale).

Causes Poverty

 Population explosion
 High level of un-employment
 Inequalities of income
 Social factorsJoint family system
 Political factorsBefore Independence, India was exploited under the British rule.
 Inflation
 High illiteracy rate
 Poor state of agriculture

Removing Poverty

 Acceleration of economic growth

 Reducing inequalities of income
 Population control
 Agricultural development
 More employment opportunities
 Land reforms

Dimensional Approaches to remove Poverty

1- Growth oriented approach

 this approach is based on an expectation that effects of economic growth (rapid increase in
GDP & percapital income) would speed to all sections of the society & will trickle down to
the poor section also)
 it was felt that rapid industrial development & transformation of agriculture through green
revolution in selected regions & more backward sections of the community.
2- Poverty alleviation programmer
 This is the second approach has been initiated from the third five year plan & progressively
enlarged by govt time to time,Like
 Swarna Jayanthi Shahri Rozgar Yojana
 Swarna Jayanthi Gram Swarozgar Yojana
 Prime minister’s Rozgar Yojana
 Sampoorna Grameen Rozgar Yojana
3- Minimum Needs programmers
 The third approach is to provide minimum basic amenities to the people. (Food grains at
subsidized rates,education, health, water supply & sanitation) people’s living standard could
be improved.
  Programmers under this approach are expected to supplement the consumption of the
poor. Create employments in health & education.
 major programs that aims at improving the food & nutritional status of poor are:-
 Public distribution system
 integrated child development scheme
 midday meal scheme

Measures to Remove Poverty

Higher economic growth

 When the pace of economic growth increases more people will be employed. With increase
in the level of employment, level of income will also increase. A persistent rise in the level of
income lowers the level of poverty.
Inclusive growth
 The benefits of the growth should reach the lower strata sections of the society. Inequalities
should be minimised to the lowest level through discriminatory taxation system, provision
of essential amenities and enforcement of minimum wages.
Reduction in population growth rate
 Large size population creates pressure on natural resources. Containment of population
growth is essential for reducing poverty.
Stability in price rise
 Price stability is an essential pre-requisite of poverty alleviation. If the prices continue to
rise, the standard of living of poor will continue to deteriorate. It is achieved through
balance of demand and supply of goods and services.
Development of rural economy
 Agriculture should be accorded a high priority to remove rural poverty. Provision of rural
infrastructure, financial assistance and land reforms are essential to remove poverty at the
grass-roots level.
Balanced regional development
 Central government should create an environment for balanced regional development. It
can be achieved through provision of special assistance to needy states.
Problem in schemes

 Political instability
 Lack of implementation of laws
 Caste system
 No patriotism among the people
 No interest for the rich to feed the poor
 Less subsidy provided by the government
  Poor are not being employed

Studies of Poverty in IND

 Ojha’s Estimates of Poverty --- 2250 Ca Per day

 Dandekar & Rath’s Study of Poverty --- 2250 Ca per day
 Minha’s Study of Rural Poor --- Per Capita Annual Expenditure of 240 Rs
 Bardhan’s Study of Rural Poor --- 15 Rs to be National Average
 Montek Ahluwalia Study of Rural Poverty --- 15 Rs for Rural & 20 For Urban
 Poverty line Study by Gaurav Datt --- Used 89 Rs as Poverty Line
 Minhas Study of Incidence of Poverty in IND --- Positive feedback about Poverty reduction
 PC Expert group report (Lakdawala Chairman) --- Monthly Per Capita Expenditure of 49 for Rural
& 57 urban
 Gaurav Dutt Study on Poverty --- 2400 Ca in Rural Areas & 2100 in Urban Areas

World Wide Measurement

 Europe --- a family with a net income of less than 60% of the “median net disposable income” —
a broad measure of the national average income net of taxes — is counted as poor.
 US --- The poverty line represents the basic cost of food for a family multiplied by three.
 South Africa had three poverty lines — food, middle and upper — and all three were higher than
that of India.

Poverty Estimates as Per Census

 The percentage of persons below the Poverty Line in 2011-12 has been estimated as 25.7% in
rural areas, 13.7% in urban areas and 21.9% for the country as a whole
 The respective ratios for the rural and urban areas were 41.8% and 25.7% and 37.2% for the
country as a whole in 2004-05
 In 2011-12, India had 270 million persons below the Tendulkar Poverty Line as compared to 407
million in 2004-05, that is a reduction of 137 million persons over the seven year period
 the rate of decline in the poverty ratio during the most recent 7-year period 2004-05 to 2011-12
was about three times of that experienced in the 11-year period 1993-94 to 2004-05
 the real MPCE increased by much more in the second period (2004-05 to 2011-12) as compared
to the first (1993-94 to 2004-05) | that the increase was fairly well distributed across all
deciles of the population, and | the distribution was particularly equitable in rural areas
 PC Say Poverty Ratio in the Country has declined to 21.9% in 2011-12 from 37.2% in 2004-05 on
account of increased Per Capita Consumption

12th Five Year Plan – Poverty Alleviation

International Initiative on Poverty

 17th October – The International Day For the Eradication of Poverty