Poverty and Developmental Issues - Types, Estimates, Causes

Poverty is a complex condition where individuals or communities lack the financial resources and necessities to maintain a basic standard of living.  

• The World Bank defines poverty as a state of pronounced deprivation in well-being, which includes various aspects such as low income, inadequate access to essential goods and services, limited health and education opportunities, insufficient physical security, lack of voice, and limited opportunities for personal growth.  
• Each country may have its own poverty threshold that determines the number of people living below the poverty line.  
• In India, for example, 21.9% of the population was living below the national poverty line in 2011. Globally, in 2018, almost 8% of the world's workforce and their families were living on less than US$1.90 per person per day (based on the international poverty line). 
• As of 2021, the latest official data on India's poverty comes from the Periodic Labour Force Survey (PLFS) 2018-19, conducted by the Ministry of Statistics and Programme Implementation. The survey estimated India's poverty rate at 24.9%, with 271 million Indians living below the national poverty line. However, due to the impact of the COVID-19 pandemic, the poverty rate in India is likely to have increased significantly. 

Types of Poverty 

1. Absolute Poverty 
2. Relative Poverty 

Understanding of Poverty at Global Level 

Poverty is a global issue and is recognized as a fundamental barrier to sustainable development. The United Nations has set several international targets to address poverty and promote sustainable development, including the Sustainable Development Goals (SDGs) and the Millennium Development Goals (MDGs). Here is a summary of how poverty is understood globally and its link to these targets: 

Global Understanding of Poverty: 

Poverty is a complex and multidimensional phenomenon that goes beyond the lack of income or material possessions. It is characterized by the denial of opportunities and choices, lack of access to essential services, social exclusion, and vulnerability to adverse shocks. Poverty is both a cause and consequence of underdevelopment, and it affects individuals, families, communities, and nations. 

The United Nations has set several international targets to address poverty and promote sustainable development, including the following: 

1. Sustainable Development Goals (SDGs): 

• The SDGs are a set of 17 goals and 169 targets adopted by the United Nations in 2015 to guide global efforts towards sustainable development. The first goal is to "End Poverty in all its forms everywhere" and includes the following targets: 
• Reduce by at least half the proportion of men, women, and children of all ages living in poverty in all its dimensions according to national definitions. 

Implement nationally appropriate social protection systems and measures for all, including floors, and by 2030 achieve substantial coverage of the poor and the vulnerable. 

Ensure significant mobilization of resources from a variety of sources, including through enhanced development cooperation, to provide adequate and predictable means for developing countries, in particular least developed countries, to implement programs and policies to end poverty in all its dimensions. 

2. Millennium Development Goals (MDGs): 

• The MDGs were a set of eight goals adopted by the United Nations in 2000 to reduce poverty and promote sustainable development. Goal 1 was to "Eradicate Extreme Poverty and Hunger" and included the following targets: 
• Halve, between 1990 and 2015, the proportion of people whose income is less than $1 a day. 
• Halve, between 1990 and 2015, the proportion of people who suffer from hunger. 

3. World Bank's Poverty Reduction Strategy 

The World Bank has set a global target of reducing extreme poverty to 3% of the global population by 2030. The Bank's poverty reduction strategy includes the following pillars: 

• Promoting sustainable and inclusive economic growth. 
• Investing in people through better access to education, health, and social protection. 
• Fostering resilience to shocks and crises. 
• Addressing fragility and conflict. 
• Building accountable and effective institutions. 

Poverty Estimates 

Pre-Independence Poverty Estimates 

Post-Independence poverty estimates 

Poverty Line 

Poverty line is a threshold or a minimum level of income or consumption expenditure that is considered necessary to meet the basic needs of an individual or a household. It is the income or expenditure level below which a person or a household is considered poor and unable to afford the basic necessities of life, such as food, shelter, clothing, healthcare, and education. 

The poverty line varies from country to country, depending on the cost of living and the prevailing social and economic conditions. In India, the poverty line is defined by the Planning Commission (now replaced by NITI Aayog) based on the recommendations of an expert group. The poverty line is based on the level of daily per capita consumption expenditure required to meet the minimum dietary requirements and other basic needs. 

The poverty line in India is revised periodically to account for changes in the cost of living and the prevailing social and economic conditions. As of 2021, the poverty line in India is defined as a monthly per capita consumption expenditure of Rs. 1,064 in rural areas and Rs. 1,372 in urban areas. However, there is ongoing debate about the adequacy of the poverty line and whether it accurately reflects the level of deprivation and poverty in the country.  

Causes of Poverty 

1. Climatice causes 

India's poverty is affected by various factors, including economic, social, and climatic conditions. Climate plays a significant role in determining the well-being of people, particularly those living in poverty. Here are some of the climatic causes of poverty in India: 

• Droughts: India is vulnerable to droughts, particularly in arid and semi-arid regions. Droughts can cause crop failure, livestock deaths, and water scarcity, leading to poverty among farmers and rural communities. 
• Floods: India also experiences frequent floods, particularly in low-lying areas and river deltas. Floods can damage crops, homes, and infrastructure, leading to displacement and loss of livelihoods. 
• Cyclones: Coastal regions in India are vulnerable to cyclones and tropical storms, which can cause significant damage to homes, infrastructure, and crops, leading to poverty among coastal communities. 
• Heatwaves: India is also prone to heatwaves, particularly in the summer months. Heatwaves can cause heat exhaustion, dehydration, and heatstroke, particularly among the poor who lack access to air conditioning and adequate water supply. 
• Land degradation: Land degradation, including soil erosion and desertification, can reduce the productivity of agricultural land, leading to poverty among farmers and rural communities.  
• Deforestation: Deforestation can lead to soil erosion, loss of biodiversity, and reduced rainfall, leading to poverty among forest-dependent communities. 

2. Demographic Factors 

India's poverty is influenced by various demographic factors, including population growth, age structure, gender, and education. Here are some of the demographic factors leading to poverty in India: 

• Population growth: India has one of the highest population growth rates in the world. Rapid population growth puts pressure on resources and infrastructure, making it difficult to provide basic necessities like food, water, and shelter. 
• Age structure: India has a large youth population, with around 50% of the population below the age of 25. High youth unemployment rates and a lack of job opportunities can lead to poverty among young people. 
• Gender: Women in India face discrimination and inequality, which can lead to poverty. Women have limited access to education, healthcare, and employment opportunities, which can prevent them from achieving economic independence. 
• Education: Lack of education is a significant contributor to poverty in India. Children from poor families often lack access to quality education, which limits their future job opportunities and perpetuates the cycle of poverty. 
• Urbanization: Rapid urbanization in India has led to the growth of slums and informal settlements. Poor infrastructure, lack of access to basic services, and high living costs can lead to poverty among urban residents. 

3. Political Factors 

• Despite gaining independence from foreign rule over seven decades ago, poverty remains widespread both in rural and urban areas of India.  
• The persistence of poverty can be attributed to several reasons, including communal tensions and conflicts between regional parties, which hinder the implementation of poverty reduction measures.  
• Rural reforms are often delayed or only implemented partially, leading to short-term solutions that do little to address poverty in India.  
• Vote bank politics is also a factor, with political leaders excluding significant portions of the population from poverty reduction programs for their own political gain.  
• Minority ethnic communities, tribal groups, and Dalits are often overlooked as beneficiaries. Furthermore, political interests have guided development plans, which have not been successful in addressing the issue of poverty and unemployment in India, raising concerns about the effectiveness of poverty reduction efforts. 

4. Social Factors 

Untouchability, caste system, and social exclusion have been significant contributors to poverty in India for centuries. Here are some of the ways in which these factors cause poverty: 

• Limited access to education: The caste system in India has historically prevented people from lower castes, including Dalits and Adivasis, from accessing education. This lack of education limits their opportunities for employment and economic mobility, leading to a higher incidence of poverty. 
• Discrimination in employment: The caste system also creates discrimination in employment, with people from lower castes often excluded from certain jobs and industries. This exclusion limits their opportunities for income generation and economic advancement. 
• Lack of access to basic services: Dalits and Adivasis have historically been excluded from access to basic services such as healthcare, clean water, and sanitation. This lack of access to basic services can exacerbate poverty and create significant health problems. 
• Landlessness: Many Dalits and Adivasis in India are landless and work as agricultural laborers. They often face exploitation and discrimination from landlords, who are typically from higher castes. This can lead to a cycle of debt and poverty. 
• Social exclusion: Dalits and Adivasis in India have historically been socially excluded from mainstream society. This exclusion can lead to feelings of isolation and a lack of social support, which can exacerbate poverty. 

5. Economic Factors 

Low agricultural productivity: Agriculture is the primary source of livelihood for millions of people in India. However, low agricultural productivity due to a lack of modern farming techniques, inadequate irrigation, and climate change can lead to reduced income and poverty. Farmers often lack access to credit, inputs, and markets, which further exacerbates the problem. 

Lack of employment opportunities: The lack of formal employment opportunities in both rural and urban areas contributes to poverty in India. The informal sector, which employs a significant portion of the workforce, is often characterized by low wages, job insecurity, and lack of social protection. Additionally, the lack of job opportunities for women and marginalized communities further perpetuates poverty. 

Inflation: Inflation, or the rise in the prices of goods and services over time, can erode the purchasing power of people's incomes, particularly those with lower incomes. This can lead to reduced access to basic necessities such as food, healthcare, and education, thereby contributing to poverty.