Poverty in India, Rural and Urban Poverty, An Over View

 

Nawaz Ahmed Naik¹, Dr. C.M. Tiwari²

¹Research Scholar (Economics), Govt. T.R.S. (Auto) College Rewa (M.P.)

²Professor & Head (Economics Deptt.), A.P.S. University Rewa (M.P.)

 

ABSTRACT:

Poverty remains a challenge for India; poverty eradication is an important goal of economic policy. Therefore, the measurement of poverty must be acceptable because it has important political implications. This article presents the methodology followed by the expert group (Rangarajan) and explains some of the issues that have been raised since the publication of the report. In addition to methodology, some of the topics covered in the article are: calorie consumption, multidimensional poverty, urban poverty, NAS (National Accounts Statistics)-NSS (National Sample Survey) public spending and poverty, NSS and SECC (Socio-Economic Caste Census and Poverty the method approved by the new poor group is based on sound principles. As the group explained, this measure is not considered an appropriate basis for determining eligibility for various programs. But a proper anti-poverty measure is useful to get an overall picture of a country's progress. This represents the absolute minimum. It is clear that the goal of policy must be not only to reduce the number of people below this threshold, but also to ensure that people in general have a much higher standard of living. Policymakers must pursue a two-pronged strategy: allowing the economy to grow rapidly and attacking poverty directly with poverty programs.

 

 

 

INTRODUCTION:

Growth is not the only goal of economic policy. It must be ensured that all parts of society benefit from economic growth. Eradication of poverty is therefore an important goal. A person needs a certain minimum amount of food and other goods to survive. However, the understanding of poverty varies from time to time and from country to country. However, a certain degree of poverty is necessary. Only then is it possible to assess how the economy is doing, if it guarantees a certain minimum standard of living for all its citizens. Therefore, measuring poverty has important policy implications. There are actually many ways to measure poverty. Some analysts focus on people's lack of access to health, education, sanitation or housing. However, there are many problems with this approach, including difficulties in aggregating deficits across multiple scores from different sources. Perhaps the best approach is to look at this as minimum consumption expenditure per person or rather per household. Any household that does not meet this level of consumption expenditure can be considered a poor household. In turn, the minimum level of consumption expenditure can be derived from the minimum expenditure on food and other products.

 

REVIEW OF LITERATURE:

Minhas (1970) estimated poverty during 1956-57 to 1967-68 on the basis of the definition given by the Expert group of planning Commission (1962). Dandekar and Rath (1971), Bardhan (1973), Rudra (1974) and Ahluwalia (1978) defined poverty on the basis of calorie criteria. Ravallion and Datt (1996) used three poverty measures: Headcount Ratio, Poverty Gap Index and Squared Poverty Gap Index to estimate poverty during 1950-90.

 

 

Bardhan (1974) argued that the national income deflator covered both agricultural and manufactured commodities.The proportion of the rural people below the annual per capita expenditure of 180 at 1960-61 prices was worked out in the study and concluded that the percentage of rural people below the minimium level of living has significantly gone up from 38 per cent in 1960-61 to 54 per cent in 1968-69.It might be noted that the Bardhan ‘s study was just contrary to that  of Minhas indicating a declining trend of rural poverty,Bardhan s study showed the opposed trend at a rising proportion of the rural poor in the decade.

 

Gupta (1979) examined that nature, structure and magnitude of poverty in the rural and urban areas of different states in India and concluded that 47.65 per cent of rural people and 40.71 per cent of people in urban areas were living under poverty line. The poverty level was estimated on the bases of a per capita monthly consumption expenditure of 61.8 per cent and 71.30 for rural and urban areas, respectively, taking the constant price of 1976-77 as the base. The author also measured the relative level of poverty by using the indicators 1. Reasons for migration 2. Present Socio-Economic conditions which include nature of occupation, per capita income, and indebtedness nature of expenditure levels on education, health awareness size of the family, nature of housing, and levels of aspiration.3. Nature of dieting and nutritional base line.

 

Subarmanian (1983) examined that they used time series data of Gini coefficient, real wage, net domestic product in agriculture per head of rural population and Sen’s Index of poverty for the years from 1960-61 to 1970-71. This analysis related the following; if the inequality in consumption decreased by one per cent when other independent variable remain constant, the poverty decreases by 0.62 per cent. If the real wage rate increases by (‘1) one rupee per day, the poverty declines by 0.19 per cent when other variables remains constant. If the net domestic product in agriculture per head of rural production increases by one rupee when other independent variables remain constant, the poverty declines by 0.001 per -cent. This study showed that in the matter of reduction of poverty, one 48 must be adopted proper redistribution policy so as to ensure equality in the level of consumption.

 

OBJECTIVES:

(I) Causes of urban and rural poverty in India.

(II)Programs and policies implemented in India to eradicate rural and urban poverty from the root level.

 

RESEARCH METHDOLOGY:

The poverty ratio which is the ratio of the number of poor people to the total population is expressed as a percentage. It is also known as HCR (personal ratio). The poverty ratio is measured by an exogenously defined poverty line, which is quantified by monthly per capita consumption expenditure and the class distribution of individuals obtained from the NSSO comprehensive sample survey of consumption expenditure data. In India, we have a long history of measuring poverty. The poverty assessment method used by the Planning Commission is based on the recommendations of task force/working group/expert groups of eminent experts in the field. From time to time, the Planning Commission constituted these groups to revisit methodological issues related to poverty measurement to make the estimates more relevant to the current economic situation. A working group of the Planning Commission defined the poverty assessment methodology in 1962 and it has been fiercely debated over the years by academics, experts, policy makers, etc. In response, the Planning Commission periodically appointed a task force/group of experts to review the methods. In June 2012, the Government of India appointed a team of experts (C. Rangaraja as president) to study a new method of measuring poverty. The commission published its report at the end of June 2014. The methods of the expert group (Rangarajan) The rapid growth of  per capita income and consumption in the first decade of this century and the resulting changes in the structure of the economy and poverty from the people's point of view were considered to require a new perspective of the poverty line and its composition. At the same time, there have been important changes in the composition of private consumption expenditures: a decrease in the share of foodstuffs and cereals. In this background, a group of experts (Rangarajan) must define their own method to draw the poverty line and measure poverty. Health services are based on NSS cycle 60 (January June 2004) Health and Morbidity Survey.  State-specific rural poverty lines (2004-2005) are obtained by adjusting state-specific urban poverty lines (2004-2005) with "within-state-rural into national poverty lines in urban areas.The Expert Group (Rangarajan) has the following terms of reference:

 

(a) “To comprehensively review the existing methodology of estimation of poverty and examine whether the poverty line should be fixed solely in terms of a consumption basket or whether other criteria are also relevant, and if so, whether the two can be effectively combined to evolve a basis for estimation of poverty in rural and urban areas.

(b) “To review alternative methods of estimation of poverty which may be in use in other countries, including their procedural aspects; and indicate whether on this basis, a particular method can be evolved for empirical estimation of poverty in India, including procedures for updating it over time and across states.

Causes of Urban and Rural Poverty, Why India are still a Poor Country?

India has faced numerable obstacles in the way of development

1)    Rapid Population.

2)    Ever increasing economic inequality.

3)    Lack of small scale sectors.

4)    Mismanagement and faulty development model.

5)    Existence of Corruption.

6)    Illiteracy, lack of Education.

7)    Distribution of wealth.

8)    Caste System in India.

 

(II) Government Programmes and Policies to eradication of Rural and Urban Poverty:

1. MGNREGA (2005) Parliament enacted MGNREGA Act. - It promises to give minimum 100 days of unskilled manual labour to rural household whose adult members volunteer for it. Households are eligible for unemployment allowances if employment not was provided within 15 days of demand. - MNREGA labourers are used for creating durable assets as per local needs e.g. ponds, wells, cattle sheds, granary, vermin compost plants, crematorium, renovation of Anganwadi centres, school buildings - No contractors / machinery allowed. - In any project, 60% of amount should go towards wages and 40% towards material. - Union bears 100% wage cost and 75% of material cost. - Wages are linked to Consumer Price Index (Agriculture labour:AL). [Although Modi thinking of linking it with CPI-Rural] - Social audit by the gram sabha at least once in every 6 months.

2. National Livelihood Missions =Skill+Loan - In the late 70s, Government had launched Integrated Rural Development Programme (IRDP), Training of Rural Youth for Self Employment (TRYSEM) and a half dozen other schemes

3. Deen Dayal Antyodaya Yojana: National Urban Livelihoods Mission (DAY-NURM) 1. Give urban poors skill training and loan for self-employment. 2. Develop vendor markets for urban vendors. 3. Shelters for homeless people.

4. Deen Dayal Antyodaya Yojana: National Rural Livelihoods Mission (DAY-NRLM) 1. Bring min.1 woman from each poor household to Self Help Group (SHG) → give them training and loans for candle/soap/handicraft etc. biz. 2. Give training to rural men. They’ll do self-employment or skilled wage employment = More income then working as farm labourers. - Deen Dayal Upadhyaya Grameen Kaushalya Yojana (DDUGKY-2014): - Rural Youth given FREE skill training. Higher age limit for SC/ST/Women/PH. Guaranteed Placement for at least 75% trained candidates. - Aajeevika Grameen Express Yojana (AGEY-2017): interest-free loans given to SHG / Community Based Organisations (CBOs) to buy public transport vehicle so they can earn by transporting ₹ ₹ by transporting ₹ ₹ by transporting passengers.

5. Mission Antyodaya (2017) − It’s similar to those two timepass ‘Adarsh Gram Yojanas’. − Here Government will implement the other ongoing schemes with more vigilance and accountability with the help of Gram Panchayat, NGOs, SHGs, ASHA workers etc.

 

CONCLUSION:

Poverty is still a big challenge for India, India is 2^nd most populated Country in the World, India is still under developed Country, There are number of Poverty Alleviations programmes, Schemes sponsored by government of India. India is facing problems in Education Sector i.e. lack of quality, Infrastructure. Casteism still works in the Country, Poor mind set, Corruption still works in the country, need measures to eradicate the Corruption at root level, Need to implement government schemes at door level, Need to lead the facilities at Urban and Rural Areas of the Country, Transport and Communication, Health, Social Welfare Schemes, proper implementation can be helpful in reduction of Poverty.

 

REFERENCES:

1.      Deaton, Augus and Jean Dreze 2002. Poverty and Inequality in India: A Re-examinations. Princeton, Research Programme in Development Studies: Delhi School of Economics Dutt. R. and Sundharam, K.P.M. 1988.

2.      Indian Economy. S. Chand and Company: New Delhi. Fonesca. A.J. (ed.) 1971. The Challenge of Poverty in India.

3.      Vikas Publishing Company: New Delhi. Punit, A.E. 1982. Profiles of Poverty in India. Deep and Deep Company: New Delhi.

4.      Visaria, Pravin 2000. Poverty in India During 1994-98: Alternative Estimates. Institute for Economic Growth: New Delhi.

 

 

 

Received on 03.04.2023         Modified on 10.04.2023 Accepted on 18.04.2023         © A&V Publication all right reserved Int. J. Ad. Social Sciences. 2023; 11(1):56-58. DOI: 10.52711/2454-2679.2023.00009