Four main causes of poverty in India are as follows:
It is said that “a country is poor because it is poor.” This idea has come down from Ragnar Nurkse who pinpointed the problem of the vicious circle of poverty. Low level of saving reduces the scope for investment; low level of investment yields low income and thus the circle of poverty goes on indefinitely.
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Rural poverty is a multi-dimensional social problem. Its causes are varied. They are as follows:
1. Climatic factors:
Climatic conditions constitute an important cause of poverty. The hot climate of India reduces the capacity of people especially the ruralites to work for which production severely suffers. Frequent flood, famine, earthquake and cyclone cause heavy damage to agriculture. Moreover, absence of timely rain, excessive or deficient rain affect severely country’s agricultural production.
2. Demographic factors:
The following demographic factors are accountable for poverty in India.
(i) Rapid growth of population:
Rapid growth of population aggravates the poverty of the people. The growth of population exceeds the rate of growth in national income. Population growth not only creates difficulties in the removal of poverty but also lowers the per capita income which tends to increase poverty. The burden of this reduction in per capita income is borne heavily by the poor people. Population growth at a faster rate increases labour supply which tends to lower the wage rate.
(ii) Size of family:
Size of the family has significant bearing on rural poverty. The larger the size of family, the lower is the per capita income, and the lower is the standard of living. The persistence of the joint family system has contributed to the health and earning capacity of the ruralites.
3. Personal causes:
(i) Lack of motivation:
Lack of motivation is an important cause of rural poverty. Some ruralites do not have a motive to work hard or even to earn something. This accounts for the poverty of the ruralites.
Most of the rural people are lazy, dull and reluctant to work. Hence they rot in poverty.
4. Economic causes:
(i) Low agricultural productivity:
Poverty and real income are very much interrelated. Increase in real income leads to reduction of the magnitude of poverty. So far as agricultural sector is concerned, the farmers even today are following the traditional method of cultivation. Hence there is low agricultural productivity resulting in rural poverty.
(ii) Unequal distribution of land and other assets:
Land and other forms of assets constitute sources of income for the ruralites. But, unfortunately, there has been unequal distribution of land and other assets in our economy. The size-wise distribution of operational holdings indicates a very high degree of concentration in the hands of a few farmers leading to poverty of many in the rural sector.
(iii) Decline of village industries:
At present consequent upon industrialization new factories and industries are being set up in rural areas. Village industries fail to compete with them in terms of quality and price. As a result they are closed down. The workers are thrown out of employment and lead a life of poverty.
(iv) Immobility of labour:
Immobility of labour also accounts, for rural poverty. Even if higher wages are offered, labourers are not willing to leave their homes. The joint family system makes people lethargic and stay-at-home.
The ruralites are mostly illiterate, ignorant, conservative, superstitious and fatalistic. Poverty is considered as god-given, something preordained. All these factors lead to abysmal poverty in rural India.
(v) Lack of employment opportunities:
Unemployment is the reflection of poverty. Because of lack of employment opportunities, people remain either unemployed or underemployed. Most of these unemployed and underemployed workers are the small and marginal farmers and the landless agricultural labourers.
5. Social causes:
Education is an agent of social change and egalitarianism. Poverty is also said to be closely related to the levels of schooling and these two have a circular relationship. The earning power is endowed in the individual by investment in education and training. But this investment in people takes away money and lack of human investment contributes to the low earning capacity of individuals.
In this way people are poor because they have little investment in themselves and poor people do not have the funds for human capital investment.
(ii) Caste system:
Caste system in India has always been responsible for rural poverty. The subordination of the low caste people by the high caste people caused the poverty of the former. Due to rigid caste system, the low caste people could not participate in the game of economic progress.
A Shudra was not allowed to become a trader and a Vaisya could earn his bread only by trade.
Birth would decide their occupation and their economic fate. K. V. Verghese rightly observes, “Caste system acted as a springboard for class exploitation with the result that the counterpart of the poverty of the many is the opulence of the few. The second is the cause of the first.”
(iii) Joint family system:
The joint family system provides social security to its members. Some people take undue advantage of it. They live upon the income of others. They become idlers. Their normal routine of life consists in eating, sleeping and begetting children.
In this way poverty gets aggravated through joint family system.
(iv) Social customs:
The ruralites spend a large percentage of annual earnings on social ceremonies like marriage, death feast etc. As a result, they remain in debt and poverty.
(v) Growing indebtedness:
In the rural sector most of the ruralites depend on borrowings from the money-lenders and land-lords to meet even their consumption expenses. Moneylenders, however, exploit the poor by charging exorbitant rates of interest and by acquiring the mortgaged land in the event of non-payment of loans.
Indebted poor farmers cannot make themselves free from the clutches of moneylenders. Their poverty is further accentuated because of indebtedness. Such indebted families continue to remain under the poverty line for generations because of this debt-trap.
Poverty and its causes in India
June 9, 2013
by Ramandeep Kaur
At present, 28.5% of the Indian population lives below the poverty line. In the category of poor falls the people whose daily income is less than 33 rupees a day in cities and 27 rupees a day in villages. But do you think this amount is enough to survive even for a day in the country where every food item is available at sky-high prices? This means, the actual number of people living below the poverty line is much higher, as according to the statistical data, anyone earning 40 rupees won’t be considered as poor but must be facing the same difficulties in life.
Household expenditure is considered to calculate the poverty count in India. In this purchasing power of people for buying food and buying capacity for some non-food items is calculated. Though the condition in cities is more or less the same but the rural welfare programs have really helped the people in rural India. These efforts resulted in decrease in the poverty in rural India at faster pace than their urban counterparts.
But in spite of all the attempts, overall number of poor in India is increasing and becoming a hurdle. Poverty is just like a disease to which many other problems such as crime, low-paced development, etc are associated. There are number of people in India who still live on the streets and beg for the whole day to eat a meal. Underprivileged children are unable to attend school and, and those have the opportunity drop out after a year or so. People below poverty line live in unhygienic conditions and are so prone to many health problems. With this, the vicious cycle of poor health, lack of education and more poverty keeps on increasing.
Facts on Poverty in India
Who comes in the category of the poorest class in India? – Tribal people, Dalits and labour class including farm workers in villages and casual workers in cities are still very poor and make the poorest class in India.
Where do the majority of poor live in India? – 60% of the poor still reside in the states of Bihar, Jharkhand, Odisha, Madhya Pradesh, Chattisgarh, Uttar Pradesh and Uttarakhand. The reason for these states to be in the category of the poorest state is because 85% of tribal people live there. Also, most of these regions are either flood-prone or suffer from calamities. These conditions hamper agriculture to a great extent, on which the household income of these people depends.
According to the recent Global Hunger Index Report 2012 by the International Food Research Institute, India ranks 97th in Global Hunger Index. Though there is no shortage of food production in India, our nation still has the highest percentage of underweight children under five. India is working hard to become a superpower in 2020, but what about these poor in India as our nation still lags behind in improving GHI.
India at present has a greater share of the poor around the world. Thirty years ago, India was home to one-fifth of world’s poor but now it is a home to one-third of poor people. This means we now have more poor in India as compared to thirty years ago.
International poverty line stands at $ 1.25 per day and in 2010, 32.7% of the total population in India was below this line.
According to a 2011 poverty Development Goals Report, poverty in India is expected to drop by 22% in 2015.
Causes of Poverty in India
High population growth rate is one of major reasons of poverty in India. This further leads to high level of illiteracy, poor health care facilities and lack of access to financial resources. Also, high population growth affects the per capita income and makes per capita income even lower. It is expected that population in India will reach 1.5 billion by 2026 and then India will be the largest nation in the world. But India’s economy is not growing at the same pace. This means shortage of jobs. For this much population, near about 20 million new jobs would be required. Number of poor will keep on increasing if such a big number of jobs won’t be created.
Ever increasing prices of even basic commodities is another reason of poverty. A person below the poverty line finds it difficult to survive. Caste system and unequal distribution of income and resources is another reason of poverty in India.
Apart from all these, unskilled workers are paid very low in spite of hard work they put daily. The problem lies with the unorganized sector as owners do not bother the way their workers live and the amount they earn. Their area of concern is just cost-cutting and more profit. Because of the number of workers looking for a job is higher than the jobs available, unskilled workers have no other option but to work for less money. The government should really find a way to impose minimum wage standards for these workers. At the same time, the government should ensure that this is implemented well.
Poverty must be eradicated from India as every person has the right to live a healthy life.
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