class 12 Indian economy poverty revision notes

 POVERTY



Poverty refers to the state of not having enough money to take care of basic needs of life such as nutritious food, descent clothing, and safe shelter. (Here I am using these terms because everybody is getting food, clothing and shelter, but the poor people do not get nutritious food, descent clothing, and safe shelter)
Or

It a situation in which an individual or a group of individuals are unable to fulfill the basic needs of life such as nutritious food, descent clothing, and safe shelter.

WHO ARE POOR

DIMENSIONS OF POVERTY

Poverty has multi dimensions:

 Hunger and starvation

 Poor health

 Lack of clean water and sanitation

 Living with a sense of helplessness

 Leads to debt trap

 Non access to modern education and health facilities

POVERTY LINE

Meaning: Poverty line is a cutoff point on the line of distribution which distinguishes people as poor and non poor.

Methods of Fixing Poverty Line in India:

There are two methods

(a) Consumption Criteria (Minimum Calorie Criterion) :

According to this criterion poverty line is fixed on the basis of average calorie intake. According to the Planning Commission the average calorie intake to determine poverty is 2400 calorie and 2100 calorie per person per day in rural and urban areas respectively.

(b) Income Criteria (Minimum Consumption Expenditure Criterion) :

According to this criterion based on the consumption criteria how much income is required will determine the poverty line. On the basis of the year 2000 prices it was Rs. 328 and Rs. 454 in rural and urban areas respectively per person per month.But recently planning commission has prescribed (As per Tendulkar Panel’s report) this minimum income limit as Rs.27 and Rs. 33 per person per day in rural and urban areas respectively.This means the food basket which gives 2400 calorie costs Rs. 27 in rural areas and which gives 2100 calorie costs Rs. 33 in urban areas.

Poverty has two variants

(a) Absolute Poverty:

 It refers to poverty of people as per the poverty line.

 The person whose income is below the poverty line are considered as poor

 The concepts of Monthly Per capita Expenditure and Consumption of Average Calorie Intake are used to measure Absolute Poverty.

(b) Relative Poverty:

 It refers to poverty of people in relation to other people , regions or nations

 It is interpreted in terms of inequality of income

 The concepts of Lorenz Curve and Ginni coefficient are used to measure relative poverty.

CAUSES OF POVERTY

i. Rapid population growth

ii. Low level of Capital Formation

iii. Lack of alternate employment opportunities other than agriculture

iv. Illiteracy

v. Wide spread unemployment

vi. Lack of proper implementation of Public Distribution System

vii. Indebtedness

viii. Poverty itself (Vicious Circle of Poverty)

POLICIES AND PROGRAMMES TOWARDS POVERTY ALLEVIATION

The government‘s approach to poverty reduction was of three planks.

 Growth oriented approach

 Specific poverty alleviation programmes/Targeted anti-poverty Measures

 Providing basic amenities to the people

(a) Growth Oriented Approach

 This approach was implemented on the assumption of the “Trickle Down Theory of Development”.

 It was expected that the effect of economic growth would spread to all sections of the society and also to the poor section.

 Govt. initiated rapid industrialization and Green revolution to make this a success.

(b) Targeted Anti-poverty Measures

Under this approach govt. have initiated many Specific Poverty Alleviation Programmes .These are as follows.

a. Mahatma Gandhi National Rural Employment Guarantee Programme (MGNREGP)

b. Swarnajayanti Gram SwarojgarYojana (SGSY)

c. SwarnaJayantiSahariRojgarYojana (SJSRY)

d. SampoornaGrameenRojgarYojana (SGRY)

© Providing basic amenities to the people

Under this approach govt. initiated many programmes which gives social securities and basic amenities of life to the people and address the poverty. The programmes are as follows.

o Public Distribution System (PDS)

o Integrated Child Development Scheme (ICDS)

o Mid-day Meals Scheme (MMS)

o National Social Assistance programmes (NSAP)

o Indira AwasYojana (IAY)

o Antodaya Anna Yojana (AAY)

o Million Wells cheme (MWS)

o National Rural Drinking Water Programme (NRDWP)




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