Q.1. Discuss per capita expenditure method of determining poverty line? What are its limitations?
Ans. Per capita expenditure method determines poverty by the monetary value of the minimum calorie intake. The minimum calorie intake was estimated at 2,400 calories for a rural person and 2,100 for a person in the urban area. On the basis of this, the poverty line was defined worth ₹ 673 as consumption per person a month for rural areas and ₹ 860 for urban areas for the year 2009–10.
Limitations of Per Capita Expenditure Method of Determining Poverty Line
(i) It groups all the poor together, without differentiating between the very poor and the other types of poor.
(ii) It takes into account only expenditure on food and a few select items. With this mechanism, it becomes difficult to identify who among the poor need the most help.
(iii) Various factors such as accessibility to basic education, health care, drinking water and sanitation are ignored while developing poverty line.
(iv) Social factors such as illiteracy, ill health, lack of access to resources, discrimination or lack of civil and political freedoms trigger and perpetuate poverty. These are also not taken into consideration while determining poverty line.
Q.2. What are the causes of poverty in India?
Ans. The main causes of poverty in India are the following:
(i) Underdeveloped Nature of the Economy: Indian economy is an underdeveloped economy. Its per capita income is low. Thus, its underdeveloped nature is closely associated with poverty.
(ii) Rapid Growth of Population: Rapid growth of population in already overpopulated countries like India is one of the main causes of poverty. With the increase in population, the national income increases, however, the per capita income remains more or less the same.
(iii) Unstable and Casual Nature of Employment: The poor people lack basic literacy and skills. As a result, they have very limited economic opportunities and face unstable employment. A large number of rural poor migrate to urban areas in search of employment and livelihood. The industries in cities, however, are not able to absorb all these people. The urban poor are either unemployed or intermittently employed as casual labourers.
(iv) Predominance of Agriculture: Agriculture is the principal means of livelihood and land is the primary assets of rural people. Productivity of land is an important determinant of material well being. But the productivity of land in India is very low and thus, people remain struck in poverty.
(v) Failure of Land Reforms: Since independence, the government attempted to take lands from those who are having large amounts of land and allot to those who do not have any land but work on lands as wage labourers. This policy of land reforms was successful only to a limited extent. This has left the large section of agricultural workers, scheduled castes and scheduled tribes as wage labourers. As a result, this group of population remained unable to possess assets or skill and remained struck in poverty.
(vi) Indebtedness of the Farmers: Due to the adoption of developed techniques of production in agriculture, farmers had taken loans. In recent times, many farmers committed suicide due to their inability to pay back the loans. This indebtedness makes the people unable to raise their income and thus, remain struck in poverty.
(vii) Increase in Prices: The continuous and steep price rise adds to the miseries of poor. Although, it benefits a few people in the society (businessmen), the persons in lower income group find it difficult to meet even their minimum needs.
(viii) Unequal Distribution of Income and Wealth: Unequal distribution of income and wealth has also led to persistence of poverty in India. This has generated two distinct groups of ‘have and have not’ in the society. One group comprises those who possess the means of production and earn their income while the other group consists of those who rely on their labour power for subsistence. The gap between these groups has widened over the years thereby worsening the position of the poor.
Q.3. Suggest measures to remove poverty in India.
Ans. The problem of poverty is a big danger to the unity of India. Although the government has adopted many programmes, covering different aspects together, following measures can also be undertaken to remove poverty:
(i) Population Control: Growing population is a major cause of poverty in India. Hence, it is necessary to control it. Family planning programme should be implemented effectively.
(ii) Creation of More Employment Opportunities: Though it has been stated in our Constitution that the government would provide employment opportunities to all, but unemployment is still a big problem in India. It is also responsible for poverty. Hence, it is essential to promote employment through intensive skill development technology.
(iii) Increase in Production: Industrial and agricultural production should be increased to remove poverty. Present capacity should be utilised fully and new techniques should be adopted. Proper coordination should be there between large scale and small scale industries. Superior seeds, manures, fertilisers and modern methods of production should be adopted for agricultural development. Necessary irrigation facilities should be made.
(iv) Check on Price Rise: Price rise is also responsible for poverty in India. It decidedly goes against the interests of the poor. Thus, price rise must be checked through proper fiscal and monetary policies and other measures.
(v) More Emphasis on Small, Rural and Cottage Industries: Small scale and cottage industries have not developed fully in India. The government should adopt effective methods to expand small and cottage industries, which will increase the self-employment opportunities for the poor.
(vi) Stepping-up Capital Formation: Low rate of capital formation is a major hindrance in the way of fast economic development. Capital formation rate, therefore, must be increased. As it basically depends on the saving rate, every possible effort should be made to increase savings and their mobilisation.
(vii) Equal Distribution of Income and Wealth: One cause of inequitable distribution of income and wealth is that economic and employment opportunities are not equal for all. This inequality should be reduced. The poor should be given priority in employment opportunities. Tax system should be developed in such a way that income and wealth does not get concentrated in a few hands.
(viii) Effective Implementation of Programmes Designed to Attack Poverty: Undoubtedly, the government has implemented many programmes to attack poverty. It is unfortunate that these programmes have not been proved helpful to the poor because of ineffective implementation. Many social and political factors are responsible for it. Therefore, effective implementation of these programmes is necessary if poverty is to be reduced.
Q.4. Explain the self-employment and wage generation approach of the government for poverty alleviation.
Ans. Government’s approach of self–employment and wage generation was initiated from Third Five Year Plan (1961-66) and has been enlarged successfully since then. The following programmes have been initiated by the government from time to time under this approach:
(i) Food for work Programme (FWP): FWP was launched in the 1970s for the upliftment of the poor. Under this programme, foodgrains are distributed against the wage work.
(ii) Prime Minister’s Rozgar Yojana (PMRY): This programme has been implemented by the Khadi and Village Industries Commission, which aims at creating self-employment opportunities in rural areas and small towns. One can get financial assistance with bank loans to set up small enterprises under this programme. Under PMRY, the educated unemployed from low-income families in both rural and urban areas can get financial help to set up any type of industry which generates employment.
(iii) Swarna Jayanti Shahari Rozgar Yojana (SJSRY): It aims at creating employment opportunities, both self-employment and wage employment in urban areas. Individuals were given financial assistance under self-employment programmes.
(iv) Swarnajayanthi Gram Swarozgar Yojana: Sawarnajayanthi Gram Swarozgar Yojana was launched in April 1999 and is the only self-employment programme currently being implemented. It aims at promoting micro enterprises and to bring the assisted poor families (Swarozgaris) above the poverty line by organising them into Self-Help Groups through the process of social mobilisation, training and capacity building and provision of income generating assets through a mix of Bank Credit and Government subsidy.
(v) Sampoorna Grameen Rozgar Yojana (SGRY): SGRY was launched in September 2001. The schemes of Jawahar Gram Samridhi Yojana and Employment Assurance Scheme have been fully integrated with SGRY. The objective of the scheme is to provide additional wage employment along with food security, creation of durable community, social and economic assets and infrastructure development in the rural areas. The scheme envisages generation of 100 man days of employment in a year.
(vi) National Food for Work Programme (NFWP): National Food for Work Programme was launched on November 14, 2004 in 150 most backward districts of the India. It is implemented as a 100 per cent centrally sponsored scheme and the foodgrains are provided to States free of cost. The objective of the programme was to intensify the generation of supplementary wage employment.
Q.5. Discuss the various programmes introduced under the government’s minimum basic needs providing approach for poverty alleviation.
Ans. Programmes under minimum basic needs providing approach are expected to supplement the consumption of the poor, improve health and education and create employment opportunities. Government has adopted the following programmes under this approach:
(i) Pradhan Mantri Gram Sadak Yojana (PMGSY): This programme aims at building all-weather roads by 2007 in all villages having population of 500 persons.
(ii) Pradhan Mantri Gramodaya Yojana (PMGY): PMGY was launched in 2000-01 in all the states and union territories in order to achieve the objective of sustainable human development at the village level. The PMGY envisages allocation of Additional Central Assistance to the States and Union Territories for selected basic minimum services in order to focus on certain priority areas of the government. Initially, PMGY had five components viz. primary health, primary education, rural shelter, rural drinking water and nutrition. Rural electrification has been added as an additional component from 2001-02.
(iii) Valmiki Ambedkar Awas Yojana (Vambay): This programme was launched in December 2001 to facilitate the construction and up-gradation of dwelling units for the slum dwellers. It also aims to provide a healthy and enabling urban environment through community toilets under ‘Nirmal Bharat Abhiyan’ a component of the scheme.
(iv) National Social Assistance Programme (Nsap): The government initiated National Social Assistance Programme under which, homeless elderly people are given pension to sustain themselves. The programme also covers poor and destitute women.