Poverty- Cause of all Problems

Overview  

Poverty is a state where a person is not able to access his daily needs of life, such as, food, shelter, and clothing, etc.,. due to lack of financial resources. In this case the income from employment is so low that even basic needs can’t be met. It is not from today, it has been from earlier times and our country is not able to get out from it. Each nation may have its own threshold that determines how many of its people are living in poverty. Poverty-stricken people and families might go without proper housing, clean water, healthy food, and medical attention. Now, it is very important to know that who comes under poverty and who does not. Every nation has it’s own way to measure poverty. The poverty ratio in India has been measured from an exogenously determined poverty line quantified in terms of per capita consumption expenditure over a month and the class distribution of persons obtained from the large sample survey of consumer expenditure data of the National Sample Survey Office (NSSO). 

Understanding Poverty in India  

The incidence of poverty in India is a matter of concern for the policy analysts and academic researchers both because of it’s scope and intensity. National poverty line estimates indicated a poverty incidence of 27.5% in 2004-2005, implying that over one quarter of the population in India lives below the poverty line. Also, in absolute numbers, India still has 301.7 million poor persons with a significant percentage of them being substantially or severely poor in terms of the norms identified as being necessary for survival. At present, 60 per cent of India’s population, or an estimated 812 million people, live below that poverty line. The significance of India in the context of world poverty is apparent given the fact that around half of the world’s poor live in South Asia and of the 534 million people in South Asia who lived on less than $1 per day in 2003, over 300 million lived in India. While economic growth is a powerful tool for poverty reduction, the impact of higher growth on poverty reduction depends significantly on the pattern of growth and levels of inequality. Owing to rapid growth in recent years, the Indian economy has also undergone significant structural changes. Inclusive growth has therefore become a major policy priority and is defined as a process whereby the benefits of growth are shared by a vast proportion of the population. 

Causes of Poverty 

1. Increase in Population- Population has been rising in India at a rapid speed. This rise is mainly due to fall in death rate and more birth rate. Due to which the number of people to attain the resources are more than the actual resources and this is why poverty exists. 

2. Unemployment and Under employment- Due to continuous rise in population, there is chronic unemployment and under employment in India. There is educated unemployment and disguised unemployment. Poverty is just the reflection of unemployment. 

3. Capital Deficiency- To decrease poverty even if people want to start a small industry and work capital is needed. And, people who are in poverty it will be a challenge to arrange for capital, and hence arises the problem of capital deficiency.  

4. Under-developed economy– The Indian economy is under developed due to low rate of growth. It is the main cause of poverty. 

5. Increase in prices- The steep rise in prices has affected the poor badly. They have become poorer. 

6. Rural Economy– Indian economy is rural economy. Indian agriculture is backward. It has great pressure of population. Income in agriculture is low and disguised unemployment is more in agriculture. 

7. Lack of Skilled Labour– In India, unskilled labour is in abundant supply but skilled labour is less due to insufficient industrial education and training. 

8. Low rate of growth– The growth rate of the economy has been 3.7% and growth rate of population has been 1.8%. So compared to population, per capita growth rate of economy has been very low. It is the main cause of poverty.  

Poverty reduction would be possible in India through higher economic growth, increasing stress on universal free elementary education, declining population growth, increasing empowerment of the women and the economically weaker sections of society.