POVERTY

BY

KRISHNAKUMAR C S, PGT ECONOMICS

DAV – BHEL SCHOOL, RANIPET

Poverty is a situation in which an individual is unable to fulfill the basic necessities of life such as food, shelter, clothing, basic education and healthcare.

​

• SECTIONS OF SOCIETY THAT ARE VULNERABLE TO POVERTY IN URBAN AREAS (URBAN POOR)

​

PUSH CART VENDORS

COBBLERS

FLOWER SELLERS

STREET VENDORS

RAG PICKERS

BEGGERS

• SECTIONS OF SOCIETY THAT ARE VULNERABLE TO POVERTY IN RURAL AREAS (RURAL POOR)

​

LANDLESS LABOURERS

MARGINAL AND SMALL FARMERS

VILLAGE ARTISANS

CHARACTERISTICS OF POOR PEOPLE (MANIFESTATIONS OF POVERTY)

They live in huts. Some of them do not have any

shelter.

In villages, they are landless. Some of them have

small pieces of land.

They do not get sufficient food. Starvation is

common among them. Children suffer from

malnutrition.

They are uneducated and unskilled. So, it is

difficult to get employment.

​

​

​

​

​

​

​

Many of them suffer from diseases. Health

condition is poor.

They do not get safe drinking water and sanitation

facilities.

The children do not get education.

They borrow money from money lenders and fall

in to debt trap.

Gender inequality prevails among them. Women

are the poorest among the poor.

​

Measures of Poverty

ABSOLUTE POVERTY

• It refers to the inability to secure basic necessities of life such as food, shelter, clothing, basic education and health care.

​

RELATIVE POVERTY

• It refers to the poverty of people in comparison to another person, place or country.
• Examples:
• A teacher is poor in comparison to a big business man.
• A casual worker is poor in comparison to a teacher.
• India is poor in comparison to the USA.
• Somalia is poor in comparison to India.

POVERTY LINE

The minimum income required for a person to satisfy his basic necessities of life is termed Poverty Line. It is used to identify the poor people.

​

Estimation of Poverty line

The minimum food required for a person is calculated in calories. Then it is converted in to equivalent money value. A minimum amount is added for shelter and clothing. The total amount is called Poverty Line.

If a persons income or expenditure is less than poverty line, he is considered poor (Below Poverty Line). India uses Monthly Per capita Expenditure(MPCE) to identify BPL families.

DADABHAI NAOROJI

​

​

​

​

​

​

​

​

He is the first person to estimate Poverty Line in India. He used Jail Cost of living. He estimated the amount of money needed for providing food to a prisoner. Adjustments were made to calculate the amount needed for children.

​

​

​

​

​

Attempts to Estimate Poverty Line after Independence

(i) In 1962, the Planning Commission set up a Study Group.

(ii) In 1979, another the ‘Task Force on Projections of Minimum Needs and Effective Consumption Demand’ was formed.

(iii) IN 1989 1ND 2005 Expert Groups were formed.

​

CATEGORIES OF POOR PEOPLE

DRAWBACKS OR LIMITATIONS OF POVERTY LINE

1. It does not differentiate between poor and very poor.
2. It considers only the money needed for food, shelter and clothing. Man needs many other facilities like basic education and health care.
3. It does not consider social factors like illiteracy, social discrimination, ill health etc.

​

​

​

ALTERNATIVE METHODS TO MEASURE POVERTY

• Amartya Sen, has developed an index known as Sen Index.

​

​

​

​

​

​

​

• Poverty Gap Index and Squared Poverty Gap are the other tools used to identify poor.

POVERTY SITUATION IN INDIA

1. In 1973 – 74, 320 million people were below poverty line. In 2011 – 12, this number has decreased to 270 million.
2. In 1973 – 74, 55% of the population was below poverty line. In 2011 – 12, it has decreased to 22%
3. More than 75% of the poor people are living in rural areas.
4. Poverty is severe in Odisha, Madhya Pradesh, Bihar and Uttar Pradesh.
5. Poverty has decreased considerably in Tamil Nadu and West Bengal.

​

​

• CAUSES OF POVERTY IN INDIA

​

​

(i) social, economic and political inequality

(ii) social exclusion

(iii)unemployment

(iv) indebtedness

(v) unequal distribution of wealth.

(vi) low capital formation

(vii) lack of infrastructure

(viii) lack of demand

(ix) rapid growth of population

(x) lack of social/ welfare nets.

(xi) British Rule

BRITISH RULE AND POVERTY

• British followed a policy of de-industrialisation in India. Indian industries declined during the British Rule.
• Indian agricultural sector became backward. Land Revenue systems introduced by the British resulted in the decline of agriculture.
• The British imposed heavy tax on the Indian people.
• They took away India’s resources. They used India as a market for selling their goods and a source of raw materials.

​

​

• GOVERNMENT’S APPROACH TO ABOLISH POVERTY

A. Growth Oriented Approach:

Increase in GDP and Per Capita GDP will help in abolishing poverty. The effects of economic growth will spread to all sections of society. It will trickle down to poorer sections of society. So, development of agricultural sector, industrial sector and service sector was given priority in the Five year Plans.

B. POVERTY ALLEVIATION PROGRAMMES

They are targeted programmes to help poor people to come out of poverty. They aim at providing employment and create social assets.

​

(i) National Food for Work Programme (NFFWP) was launched in 2004 to provide wage employment to unemployed people.

Wage will be given in the form of food materials. Creation of community assets like roads, schools, hospitals and public buildings are given importance in this programme.

​

​

(ii) Rural Employment Generation Programme (REGP):

It aims at creating self employment opportunities in rural areas and small towns.

The Khadi and Village Industries Commission is implementing it.

Under this programme, one can get financial assistance in the form of bank loans to set up small industries.

(iii) Prime Minister’s Rozgar Yojana (PMRY):It was launched in 1994 to create self employment. Educated young men are given financial and technical help to start their own enterprises.

(iv) Swarna Jayanti Shahari Rozgar Yojana (SJSRY): SJSRY mainly aimed at creating employment opportunities— both self-employment and wage

employment—in urban areas.

Now this programme is renamed Prime Minister’s Employment Generation Programme (PMEGP).

​

(v) Swarnajayanti Gram Swarozgar Yojana (SGSY):

This programme encourages rural unemployed men and women to form self help groups and start their own enterprises.

Financial and technical help are provided through SHGs.

Now this programme is restructured as National Rural Livelihoods Mission (NRLM) (Deendayal Upadhyay Antyodaya Yojana).

(vi) National Urban Livelihoods Mission:

This programme encourages urban unemployed men to form self help groups and start their own enterprises.

Technical and financial help is provided through SHGs.

�(vi) Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA):� It was passed in 2005.�Under this Act, it is the responsibility of the Government to provide at least 100 days work to one member of a family in an year. �It is also called Right to Work Act.�

C) Third approach was to directly provide basic facilities to the poor.

• Examples: Provide food materials at subsidised rates, provide free education and health care, provide safe drinking water and sanitation facilities etc.
• Public Distribution System, Integrated Child Development Scheme and Midday Meal Scheme. Pradhan Mantri Gram Sadak Yojana and Valmiki Ambedkar Awas Yojana are aimed at providing minimum basic necessities to the poor people.

​

• National Social Assistance Programme : Under this programme, old people who do not have anyone to take care of them are given pension. Poor women and widows are also covered under this scheme.
• Jandhan Bank Accounts: People are encouraged to open zero balance bank accounts. This will promote saving habit. It enables Government to provide all benefits and subsidies directly to the people. The account holder gets insurance for Rs. 30000/- and accident insurance for Rs. 1 lakh.

REASONS BEHIND THE FAILURE OF THE POVERTY ALLEVIATION PROGRAMMES

• Due to unequal distribution of land and other assets, the benefits from direct poverty alleviation programmes have been taken away by the non-poor.
• The resources allocated for Poverty Alleviation Programmes are not sufficient.
• The Government and Bank officials who are responsible to implement the programmes are illmotivated, ill trained.

​

• Local institutions do not participate actively in these programmes.
• The people just above poverty line do not get the benefits of these programmes.
• People’s participation in these programmes is less.