Poverty and its Solutions

Introduction

Poverty is described as a state or situation in which an individual or a community lacks the financial resources and necessities for a basic standard of living. Poverty is described as a situation in which one's earnings from work are insufficient to meet basic human needs.

According to World Bank, Poverty is a state of deprivation in one's well-being that has several aspects. Low wages and the inability to obtain the basic goods and services needed for a dignified existence are examples. Poverty also includes poor health and education, limited access to clean water and sanitation, insufficient physical protection, a lack of voice, and a lack of ability and incentive to improve one's situation.

In India, 21.9% of the population lives below the national poverty line in 2011.
In 2018, almost 8% of the world’s workers and their families lived on less than US$1.90 per person per day (international poverty line).

Types of Poverty: There are two main classifications of poverty:

Absolute Poverty:A situation in which a household's income falls below the amount required to sustain basic living standards (food, shelter etc.). This condition allows comparisons to be made between countries as well as over time. The "dollar a day" poverty line, first adopted in 1990, calculated total poverty by the standards of the world's poorest countries. The World Bank raised it to $1.90 a day in October 2015.

Relative Poverty: It is characterised from a social standpoint as a living standard in comparison to the economic standards of the surrounding population. As a result, it is an indicator of income disparity.
In most cases, relative poverty is described as the percentage of the population earning less than a certain percentage of median income.

Poverty Estimation in India

Poverty estimate in India is done by the NITI Aayog task force using data from the National Sample Survey Office under the Ministry of Statistics and Programme Implementation to calculate a poverty line (MOSPI).
In India, the poverty line is calculated based on consumption expenditure rather than income levels.
Poverty is calculated using the National Sample Survey Organization's consumer spending surveys. A poor household is characterised as one that spends less than a certain amount per month.
The poverty ratio, which is the ratio of the number of poor to the total population expressed as a percentage, is used to determine the prevalence of poverty. It's sometimes referred to as the head-count ratio.
Alagh Committee (1979): It determined poverty line on a minimum daily requirement of 2400 and 2100 calories in Rural and Urban area respectively for an adult.

Following that, the poverty estimation was done by various committees, including the Lakdawala Committee (1993), Tendulkar Committee (2009), and Rangarajan Committee (2012).

According to the Rangarajan committee report (2014), the poverty line is projected to be Rs. 1407 per capita in urban areas and Rs. 972 in rural areas.

Causes of Poverty in India

Low Agricultural Productivity: The poor productivity of the agricultural sector is a major cause of poverty. Low productivity can be caused by a variety of factors. It is primarily due to scattered and subdivided land holdings, a lack of resources, illiteracy about modern farming technology, the use of conventional farming methods, wastage during storage, and other factors.
Inefficient Resource utilisation: In the country, there is underemployment and hidden unemployment, especially in the agricultural sector. Low agricultural productivity and a drop in living standards have resulted as a result of this.
Population Explosion: It has risen at a rate of 2.2 percent each year over the past 45 years, implying that about 17 million people are added to the country's population per year. This has a major impact on the market for consumer products.
Low Rate of Economic Development: India's economic growth has been slow, especially in the first 40 years after independence, prior to the 1991 LPG reforms.
Price Rise: The country's price increase has been consistent, adding to the burden borne by the poor. While a few individuals have benefited, the lower income groups have suffered as a result, and are unable to meet even their most basic needs.
Unemployment: Poverty in India is also exacerbated by unemployment. When the population grows, so does the number of people looking for work. However, the expansion of work opportunities is insufficient to meet the need.
Lack of Capital and Entrepreneurship: It resulted into low level of investment and job creation in the economy.
Social Factors: Apart from economic factors, social factors often obstruct India's efforts to eradicate poverty. The rules of descent, the caste system, and some customs, to name a few, are all obstacles in this regard.
Colonial Exploitation: For nearly two centuries, the British colonisation and rule over India de-industrialized the country by destroying its ancient handicrafts and textile industries. Colonial policies reduced India to a mere source of raw materials for European industries.
Climatic Factors: The states of Bihar, UP, MP, Chhattisgarh, Odisha, Jharkhand, and others account for the majority of India's poor. Natural disasters such as floods, disasters, earthquakes, and cyclones often strike these states, wreaking havoc on agriculture.

Solutions for Poverty Alleviation:

Strengthening MNREGA: The Act provides 100 days assured employment every year to every rural household. One-third of the proposed jobs would be reserved for women. This will provide remunerative jobs to poor so that they can fulfil their needs.
Increasing National Food Security Mission goals: Increase rice, wheat, pulses, and coarse cereals production in the country's defined districts by expanding the region and improving productivity in a sustainable manner.
National Rural Livelihood Mission: It arose from the need to diversify the needs of the rural poor by providing them with jobs that pay a monthly salary.
Strengthening Agriculture: By Diversifying it including coarse grains such as Ragi, Bajra, Jawar.
Strengthening MSMEs for Food production and processing.
Skill development in rural and urban areas.
Direct Benefit Transfer to people in need or who have faced agricultural crisis such as famine.
Strengthening research and development in the field of agriculture and provide proper extension services.
Reduction in malnourishment among children and women by strengthening Anganwadis and Mid day meal scheme.

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