CLASS IX ECONOMICS

POVERTY
Introduction: In our daily life, we come across many people who we think are poor. They could be landless
labourers in villages or people living in overcrowded jhuggis in cities. They could be daily wage workers at
construction sites or child workers in dhabas. Roughly 260 million (or 26 crore) people in India live in
poverty. India has the largest single concentration of the poor in the world. This illustrates the seriousness of
the challenge.

Following issues are related to poverty:

• Landlessness
• Unemployment
• Size of families
• Illiteracy
• Poor health/malnutrition
• Child labour
• Helplessness

Poverty as seen by social scientists:

Since poverty has many facets, social scientists look at it through a variety of indicators. Usually the
indicators used relate to the levels of income and consumption. But now poverty is looked through other
social indicators like illiteracy level, lack of general resistance due to malnutrition, lack of access to
healthcare, lack of job opportunities, lack of access to safe drinking water, sanitation etc. Analysis of
poverty based on social exclusion and vulnerability is now becoming very common

SOCIAL EXCLUSION
According to this concept, poverty must be seen in terms of the poor having to live only in a poor
surrounding with other poor people, excluded from enjoying social equality of better -off people in better
surroundings. Social exclusion can be both a cause as well as a consequence of poverty in the usual sense.
Broadly, it is a process through which individuals or groups are excluded from facilities, benefits and
opportunities that others (their “betters”) enjoy.
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VULNERABILITY:
Vulnerability to poverty is a measure, which describes the greater probability of certain communities (say,
members of a backward caste) or individuals (such as a widow or a physically handicapped person) of
becoming, or remaining, poor in the coming years. Vulnerability is determined by the options available to
different communities for finding an alternative living in terms of assets, education, health and job
opportunities. Further, it is analysed on the basis of the greater risks these groups face at the time of natural
disasters (earthquakes, tsunami), terrorism etc. In fact, vulnerability describes the greater probability of
being more adversely affected than other people when bad time comes for everybody, whether a flood or an
earthquake or simply a fall in the availability of jobs!

POVERTY LINE:
A common method used to measure poverty is based on the income or consumption levels. A person is
considered poor if his or her income or consumption level falls below a given “minimum level” necessary to
fulfil basic needs.
What is necessary to satisfy basic needs is different at different times and in different countries. Therefore,
poverty line may vary with time and place. Each country uses an imaginary line that is considered
appropriate for its existing level of development and its accepted minimum social norms. While determining
the poverty line in India, a minimum level of food requirement, clothing, footwear, fuel and light,
educational and medical requirement etc. are determined for subsistence. The accepted average calorie
requirement in India is 2400 calories per person per day in rural areas and 2100 calories per person per day
in urban areas.
However, for making comparisons between developing countries, many international organisations like the
World Bank use a uniform standard for the poverty line: minimum availability of the equivalent of $1 per
person per day.

Vulnerable Groups
The proportion of people below poverty line is also not same for all social groups and economic categories
in India. Social groups which are most vulnerable to poverty are scheduled caste and scheduled tribe
households. Similarly, among the economic groups, the most vulnerable groups are the rural agricultural
labour households and the urban casual labour households. 51 out of 100 people belonging to scheduled
tribes are not able to meet their basic needs. Similarly, 50 per cent of casual workers in urban areas are
below poverty line. About 50 per cent of landless agricultural workers and 43 per cent of scheduled castes
are also poor. Apart from these social groups, there is also inequality of incomes within a family. In poor
families all suffer, but some suffer more than others. Women, elderly people and female infants are
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systematically denied equal access to resources available to the family. Therefore women, children
(especially the girl child) and old people are poorest of the poor.

Inter-State Disparities
Poverty in India also has another aspect or dimension. Recent estimates show that in 20 states and union
territories, the poverty ratio is less than the national average. On the other hand, poverty is still a serious
problem in Orissa, Bihar, Assam, Tripura and Uttar Pradesh. Orissa and Bihar continue to be the two poorest
states with poverty ratios of 47 and 43 per cent respectively. Along with rural poverty urban poverty is also
high in Orissa, Madhya Pradesh, Bihar and Uttar Pradesh.
In comparison, there has been a significant decline in poverty in Kerala, Jammu and Kashmir, Andhra
Pradesh, Tamil Nadu, Gujarat and West Bengal. States like Punjab and Haryana have traditionally
succeeded in reducing poverty with the help of high agricultural growth rates. Kerala has focused more on
human resource development. In West Bengal, land reform measures have helped in reducing poverty. In
Andhra Pradesh and Tamil Nadu public distribution of food grains could have been responsible for the
improvement.

GLOBAL POVERTY SCENARIO:

The proportion of people in developing countries living in extreme economic poverty— defined by the
World Bank as living on less than $1 per day—has fallen from 28 per cent in 1990 to 21 per cent in 2001.
Although there has been a substantial reduction in global poverty, it is marked with great regional
differences. Poverty declined substantially in China and Southeast Asian countries as a result of rapid
economic growth and massive investments in human resource development. Number of poor in China has
come down from 606 million in 1981 to 212 million in 2001. In the countries of South Asia (India, Pakistan,
Sri Lanka, Nepal, Bangladesh, Bhutan) the decline has not been as rapid. Despite decline in the percentage
of the poor, the number of poor has declined marginally from 475 million in 1981 to 428 million in 2001.
Because of different poverty line definition, poverty in India is also shown higher than the national
estimates. In Sub-Saharan Africa, poverty in fact rose from 41 per cent in 1981 to 46 per cent in 2001. The
Millennium Development Goals of the United Nations calls for reducing the proportion of people living on
less than $1 a day to half the 1990 level by 2015.

Causes of Poverty
1. Less job opportunity
2. High growth rate of population.
3. Huge income inequalities.
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4. Unequal distribution of land and other resources.

5. Lack of proper implementation of policies

Anti-Poverty Measures
Removal of poverty has been one of the major objectives of Indian developmental strategy. The current anti-
poverty strategy of the government is based broadly on two planks
(1) promotion of economic growth
(2) targeted anti-poverty programmes.
Although there are so many schemes which are formulated to affect poverty directly or indirectly, some of
them are worth mentioning.

Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) 2005: was passed in
September 2005. The Act provides 100 days assured employment every year to every rural household in 200
districts. Later, the scheme will be extended to 600 districts. One third of the proposed jobs would be
reserved for women. The central government will also establish National Employment Guarantee Funds.
Similarly state governments will establish State Employment Guarantee Funds for implementation of the
scheme. Under the programme if an applicant is not provided employment within fifteen days s/he will be
entitled to a daily unemployment allowance.

National Food for Work Programme (NFWP): was launched in 2004 in 150 most backward districts of
the country. The programme is open to all rural poor who are in need of wage employment and desire to do
manual unskilled work. It is implemented as a 100 per cent centrally sponsored scheme and food grains are
provided free of cost to the states. Once the NREGA is in force, the NFWP will be subsumed within this
programme.

Prime Minister Rozgar Yozana (PMRY): was started in 1993. The aim of the programme is to create self-
employment opportunities for educated unemployed youth in rural areas and small towns. They are helped
in setting up small business and industries.

Rural Employment Generation Programme (REGP): was launched in 1995. The aim of the programme
is to create self-employment opportunities in rural areas and small towns. A target for creating 25 lakh new
jobs has been set for the programme under the Tenth Five Year plan.
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Swarnajayanti Gram Swarozgar Yojana (SGSY): was launched in 1999. The programme aims at
bringing the assisted poor families above the poverty line by organising them into self-help groups through a
mix of bank credit and government subsidy.

Pradhan Mantri Gramodaya Yozana (PMGY): launched in 2000, additional central assistance is given to
states for basic services such as primary health, primary education, rural shelter, rural drinking water and
rural electrification.

QUESTIONS WITH ANSWERS

1. What is BPL ?
Answer. In India, the concept of Poverty line is used as a measure of absolute poverty. So BPL (Below
Poverty Line) is a measure which demarcate the people, who are living below the poverty line from those,
who are living above the poverty line.

2. Name a poverty alleviation programme for rural areas with its objectives.
Answer. Rural Employment Generation Programme.
(i) The aim of the programme is to create self-employment
opportunities in rural areas and small towns.
(ii) A target for creating 25 lakhs new jobs has been set for the programme under the Tenth Five Year plan.

3. Give an account of the inter-state disparities in poverty in India.

Answer. (i) States with poverty ratio more than the national average :
Orissa, Bihar, Assam, Tripura and Uttar Pradesh are the most poverty ridden states of India. The poverty
ratio in these states is much higher than the national average. Orissa and Bihar are the poorest states with
poverty ratio of 47 and 43 respectively. Most of these states are facing rural as well as urban poverty.
(ii) States with poverty ratio less than the national average :
Recent studies show that in 20 states and union territories, the poverty ratio is less than the national average.
There has been a significant decline in poverty ratio in Kerala, Andhra Pradesh, Tamil Nadu, Gujarat and
West Bengal.
(iii) States with low poverty ratio :
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States like Punjab, Haryana, Goa, Himachal Pradesh and Jammu Kashmir have very low percentage of
population living below the poverty line.

4. Answer the following questions briefly :

(i) What do you understand by human poverty ?
Answer. (i) Human poverty is a broader concept of poverty. Along with food and income it also
includes other necessities of life like education, shelter, health care, job, security, social equality, etc.

5. Who are the poorest of the poor ?

Answer. (ii) Apart from the social groups, there is also inequality of incomes within a family. In
poor families, all suffer, but some suffer more than others. Women, elderly people and female infants
are systematically denied equal access to resources available to the family. Therefore, women,
children (especially the girl child) and old people are the poorest of the poor.

6. What are the main features of the Mahatma Gandhi National Rural Employment Guarantee
Act, 2005?
Answer: The main features are as follows:
• The National Rural Employment Guarantee Act (NREGA) 2005 was passed in September 2005.
• The act provides 100 days assured employment to every rural household in 200 districts.
• Later, the scheme will be extended to 600 districts. One- third of the proposed jobs would be
reserved for women.
• The central government will also establish National Employment Guarantee Funds.
• Similarly, state governments will establish State Employment Guarantee Funds for implementation
of the scheme.
• Under the programme, if an applicant is not provided employment within fifteen days, he/she will
be entitled to a daily unemployment allowance.

7. “The proportion of people below poverty line is also not same for all social groups and economic
categories in India.” Explain.
Answer. (i) Social Groups: The social groups which are most vulnerable to poverty are scheduled caste and
scheduled tribe households. Although the average for people below poverty line for all groups in India is 30,
48 out of 100 people belonging to scheduled tribes in rural areas are not able to meet their basic needs.
(ii) Economic groups : Similarly among the economic groups, the most vulnerable groups are the rural
agricultural labour households and the urban casual labour households.
(iii) Inequality with in family :
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Apart from these social groups, there is also inequality of incomes within a family. In poor families all
suffer, but some suffer more than others. Women, elderly people and female infants are systematically
denied equal access to resources available to the family.
Therefore women, children (especially the girl child) and old people are poorest of the poor.

8. What is poverty ?
Answer. Poverty is a situation in which a person is unable to get the minimum basic necessities of life,
i.e., food, clothing and shelter for his or her sustenance.

9. Mention any two indicators of poverty.

Answer. (i) Level of income.
(ii) Level of consumption.

10. How is the poverty line estimated periodically? Name an organisation which is responsible for
estimating poverty.
Answer. The poverty line is estimated periodically by conducting sample surveys.
These surveys are carried out by the
National Sample Survey Organisation. (NSSO).

11. Name any four poverty ridden states.

Answer. Odisha, Bihar, Assam and Tripura.

12. Discuss the major reasons for poverty in India.

Answer. (i) Lack of industrialisation: India is very backward from the industrial point of view.
(ii) Over dependence on agriculture: Even after more than 60 years of independence more than 60 per
cent of our total population still depends on agriculture for its livelihood.
(iv) Unemployment: Due to lack of job opportunities, more than 90 lakhs of our total working force are
unemployed.

13. Which of the main factor responsible for the reduction of poverty in the following states:
(i) Punjab
(ii) Kerala
(iii) West Bengal
(iv) Tamil Nadu
Answer. (i) Punjab : Povety has been reduced due to high agricultural growth rate.
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(ii) Kerala: Poverty has been reduced through human resource development.
(iii) West Bengal : Poverty has been . reduced through land reform measures.
(iv) Tamil Nadu : Poverty has been reduced through proper public distribution system.

14. What are the major features of poverty ? Explain.

Answer. (i) It also is a situation in which parents are not able to send their children to school or a
situation where sick people cannot afford treatment.
(ii) Poverty also means lack of clean water and sanitation facilities.
(iii) It also means lack of regular job at a minimum decent level. Above all it means living with a sense
of helplessness.
(iv) Poor people are in a situation in which they are ill-treated at almost every place, in farms, factories,
government offices, hospitals, railway stations etc.
(v) Poverty when looked through other social indicators like illiteracy level, lack of general resistance
due to malnutrition, lack of access to healthcare, lack of job opportunities, lack of access to safe drinking
water, sanitation etc.

15. Identify the various groups vulnerable to poverty.

Answer. (i) Social Groups: The social groups which are most vulnerable to poverty are scheduled caste
and scheduled tribe households. Although the average for people below poverty line for all groups in
India is 30, 48 out of 100 people belonging to scheduled tribes in rural areas are not able to meet their
basic needs.
(ii) Economic groups : Similarly among the economic groups, the most vulnerable groups are the rural
agricultural labour households and the urban casual labour households.
(iii) Inequality with in family :
Apart from these social groups, there is also inequality of incomes within a family. In poor families all
suffer, but some suffer more than others. Women, elderly people and female infants are systematically
denied equal access to resources available to the family.
Therefore women, children (especially the girl child) and old people are poorest of the poor.