Poverty
Poverty is a state or condition in which a person or community lacks the financial resources and essentials for a minimum standard of living. Poverty means that the income level from employment is so low that basic human needs can’t be met.
Types of Poverty:
- There are two main classifications of poverty:
Absolute Poverty:
- A condition where household income is below a necessary level to maintain basic living standards (food, shelter, housing).
- This condition makes it possible to compare between different countries and also over time.
Relative Poverty:
- It is defined from the social perspective that is living standard compared to the economic standards of population living in surroundings.
- Hence it is a measure of income inequality.
Causes of Poverty in India
Population Explosion:
- India’s population has steadily increased through the years. This also increases the demand for consumption goods tremendously.
Low Agricultural Productivity:
- A major reason for poverty in the low productivity in the agriculture sector. The reason for low productivity is manifold.
Inefficient Resource utilisation:
- There is underemployment and disguised unemployment in the country, particularly in the farming sector.
- This has resulted in low agricultural output and also led to a dip in the standard of living.
Low Rate of Economic Development:
- Economic development has been low in India especially in the first 40 years of independence before the LPG reforms in 1991.
Price Rise:
- Price rise has been steady in the country and this has added to the burden the poor carry.
Unemployment:
- The ever-increasing population has led to a higher number of job-seekers. However, there is not enough expansion in opportunities to match this demand for jobs.
Lack of Capital and Entrepreneurship:
- The shortage of capital and entrepreneurship results in low level of investment and job creation in the economy.
Social Factors:
- social factors hindering the eradication of poverty in India. Some of the hindrances in this regard are the laws of inheritance, caste system, certain traditions, etc.
Colonial Exploitation:
- Colonial Policies transformed india to a mere raw-material producer for european industries.
Climatic Factors:
- Most of india’s poor belong to the states of Bihar, UP, MP, Chhattisgarh, odisha, Jharkhand, etc.
- Natural calamities such as frequent floods, disasters, earthquake and cyclone cause heavy damage to agriculture in these states.
Poverty Trap: