2. Poverty - Meaning
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.
Poverty-stricken people and families might go without proper housing,
clean water, healthy food, and medical attention.
Each nation may have its own criteria for determining how many of its
people are living in poverty.
3. Poverty - Meaning
A person is considered poor, if his or her income or consumption
level falls below a given “minimum level” necessary to fulfil the basic
needs.
This minimum level is called the poverty line.
Poverty line was defined as the per capita consumption expenditure
level to meet average per capita daily calorie requirement of. 2400
kcal per capita per day in rural areas and 2100 kcal per capita per
day in urban areas.
4. Monthly per capita consumption expenditure of Rs. 972 in rural
areas and Rs. 1407 in urban areas is recommended as the poverty line at
the all India level.
According to recent reports, more than a quarter of the population
living in rural areas of India is below the poverty line.
Out of the total population living in the rural parts of India, 25.7% is
living below the poverty line whereas in the urban areas, the situation is a
bit better with 13.7% of the population living below the poverty line.
5. Types of Poverty
Absolute poverty
Also known as extreme poverty or abject poverty, it involves the scarcity
of basic food, clean water, health, shelter, education and information.
Those who belong to absolute poverty tend to struggle to live and
experience a lot of child deaths from preventable diseases.
Absolute Poverty is usually uncommon in developed countries.
It was first introduced in 1990, the “dollar a day” poverty line measured
absolute poverty by the standards of the world’s poorest countries; which in
2015, was changed to $1.90 a day, by the World Bank.
This number is controversial; therefore each nation has its own threshold
for absolute poverty line.
6. 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
Usually, relative poverty is measured as the percentage of the population with
income less than some fixed proportion of median income
It is a widely used measure to ascertain poverty rates in wealthy developed nations.
Situational Poverty
It is a temporary type of poverty based on occurrence of an adverse event like
environmental disaster, job loss and severe health problem
People can help themselves even with a small assistance, as the poverty comes
because of unfortunate event
Generational Poverty
It is handed over to individual and families from one generation to the one.
This is more complicated as there is no escape because the people are trapped
in its cause and unable to access the tools required to get out of it.
7. Rural Poverty
It occurs in rural areas with population below 50,000. It is the area where
there are less job opportunities, less access to services, less support for
disabilities and quality education opportunities.
People are tending to live mostly on the farming and other menial work
available to the surroundings.
Urban Poverty
It occurs in the metropolitan areas with population over 50,000. These are
some major challenges faced by the Urban Poor:
• Limited access to health and education.
• Inadequate housing and services.
• Violent and unhealthy environment because of overcrowding.
• Little or no social protection mechanism.
9. Poverty Alleviation Strategies
• India is a developing country with a significant population living in
poverty. The Indian government and various organizations have
implemented various strategies to alleviate poverty in the country.
Some of the poverty alleviation strategies in India are:
• Employment Generation: One of the most important strategies to
alleviate poverty is to generate employment opportunities. The
government has launched several schemes such as MGNREGA, Start-
up India, Skill India, and Make in India to create jobs and reduce
unemployment.
• Education: Education is a powerful tool for reducing poverty. The
government has implemented several schemes such as the Sarva
Shiksha Abhiyan (SSA), Mid-Day Meal Scheme, and Right to
Education Act to ensure that every child receives education.
10. Poverty Alleviation Strategies
• Health Care: The government has implemented several health care
schemes such as the National Health Mission, Ayushman Bharat, and
Pradhan Mantri Jan Arogya Yojana to provide affordable health care
to the poor.
• Microfinance: Microfinance is a tool to provide financial services to
the poor who do not have access to traditional banking services. The
government has implemented several schemes such as the National
Bank for Agriculture and Rural Development (NABARD), Micro
Units Development and Refinance Agency (MUDRA), and Jan Dhan
Yojana to provide financial services to the poor.
• Social Security: The government has implemented several social
security schemes such as the National Social Assistance Programme
(NSAP), National Old Age Pension Scheme, and Rashtriya Swasthya
Bima Yojana to provide financial assistance to the poor.
11. Poverty Alleviation Strategies
• Infrastructure Development: The government has launched several
infrastructure development schemes such as the Pradhan Mantri Gram
Sadak Yojana, Swachh Bharat Abhiyan, and Digital India to improve
the living standards of the poor.
• Women Empowerment: Women empowerment is an important
strategy to alleviate poverty. The government has implemented
several schemes such as the Beti Bachao Beti Padhao, Mahila E-Haat,
and Ujjwala Yojana to empower women and reduce poverty.
These are some of the poverty alleviation strategies in India. The
implementation of these strategies has helped to reduce poverty in the
country. However, there is still a long way to go to completely eradicate
poverty in India.
12. MGNREGA - Mahatma Gandhi National Rural
Employment Guarantee Act
• The Mahatma Gandhi National Rural Employment Guarantee Act was
passed on 23rd August 2005 and it was officially launched on 2nd
February 2006.
• MGNREGA is a rural wage employment program in India.
• It provides for a legal guarantee of at least 100 days of unskilled
wage employment in a financial year to rural households whose
adult members are willing to engage in unskilled manual work at
a predetermined minimum wage rate.
• The Ministry of Rural Development (MRD), Govt. of India is
monitoring the entire implementation of this scheme in association
with state governments.
13. The objectives of the Act are
• To enhance the livelihood security of the rural poor by generating wage
employment opportunities; and
• To create a rural asset base, which would enhance productive ways of
employment, and augment and sustain a rural household income
14. Key features of MGNREGA
• Legal right to work: The Act gives adult members of rural households a legal
right to employment, in contrast to past job guarantee programmes. The
beneficiaries must include at least one-third of women.
• Wages: Unless the central government notifies of a pay rate, wages shall be
paid by the wages stipulated for agricultural labourers in the state under the
Minimum Wages Act of 1948. (this should not be less than Rs 60 per day).
Currently, the federal government sets pay rates, which vary by state.
• Decentralised planning: Gram Sabhas must recommend the projects to be
carried out and must carry out at least 50% of them.
• Transparency and accountability: Wall writings, citizen information boards,
management information systems, and social audits are all options for proactive
disclosure. Gram Sabhas carry out social audits so that the locals may keep
track of how the programme is being implemented.
15. Key features of MGNREGA
• Funding: The federal government and the states split the cost of funding. Wages (for
unskilled, semiskilled, and skilled labour), material costs, and administrative costs
make up the three main categories of expenditures.
• Time-bound guarantee of work and unemployment allowance: Employment must
be provided within 15 days of being demanded failing which an ‘unemployment
allowance’ must be given.
• Worksite facilities: All work sites should have facilities such as crèches, drinking
water and first aid.
16. Significance of MGNREGA
Social
MGNREGA is the largest social security scheme in the world.
Empowerment of vulnerable sections: Large-scale engagement of women, people from
traditionally marginalised groups like Scheduled Castes and Scheduled Tribes (SCs/STs),
and others. Women generate 47% of the total person-days, while SCs/STs contribute 51%
of the total person-days.
Poverty alleviation: The less poor have used it as a means to augment their income by
working during slow agricultural seasons, while the poor have used it as a means of
escaping poverty.
Distress migration: MGNREGA has a highly positive impact on poor households with a
drastic reduction in the distress migration
Some studies even point to improved education for children in MGNREGA households.
17. Significance of MGNREGA
Economical
Employment generation: Since this program’s introduction in 2006, it has altered the
rural labour market’s makeup. Rural households were given the chance to make a
minimal income by receiving employment cards under this programme.
Increasing wage rate: Increasing the wage rate in rural areas and thereby increasing the
purchasing power in rural India.
Thrust to the rural economy: Strengthening the rural economy through the creation of
infrastructure assets.
Financial inclusion: Payments under the scheme today are mostly by way of direct
transfer into beneficiary accounts — which in turn forced people to open 10 crore new
bank or post office accounts. The scheme has indirectly enabled households to get freed
from the clutches of local money lenders too.
18. Challenges of MGNREGA
Ridiculously low wage rate: MGNREGA wage rates are now lower. The MGNREGA
wage rate cannot be less than the state’s minimum agricultural wage rate, according to
several rulings.
Inadequate budgetary allocation: Researchers determined that the scheme should have
received an allocation of Rs 76,131 crore, which was less than the actual amount, to
satisfy the registered work requirement in 2017–18. Similar to practically every year, the
first six months see more than 80% of the funds depleted.
Inflation: As agricultural labourers’ pay has multiplied, forcing farmers to seek higher
prices for their food grains through Minimum Support Prices, the MGNREGA initiative
to reduce poverty has come at the expense of skyrocketing food prices (MSPs).
Affected labour market: Rural agricultural labourer wages are pushing farmers to
mechanise their operations, which is proving to be more cost-effective.
19. Challenges of MGNREGA
Delay in payment of wages: The majority of states have not fulfilled the MGNREGA
requirement to pay wages within 15 days. Additionally, workers are not reimbursed for
late wage payments. Wage payments are frequently delayed for weeks or even months
without providing any sort of compensation.
Non-payment of unemployment allowances: When the job is not readily available, the
majority of states do not provide unemployment benefits. The failure to provide dated
receipts for the requested work hinders employees from requesting unemployment
benefits.
Ineffectiveness of local bodies: Since Panchayat Samitis hasn’t been met in months,
work approval has been put off. In 2015–16, only 10% of the 4.8 crore households were
able to fully benefit from 100 days of labour.
20. NRLM - National Rural Livelihoods Mission
• The Ministry of Rural Development's flagship program for reducing poverty is the
Deendayal Antyodaya Yojana - National Rural Livelihoods Mission (DAY-
NRLM).
• Its primary focus is to empower the poor, especially women, by creating strong
institutions that can access financial services and livelihood opportunities.
• DAY-NRLM follows a demand-driven approach, allowing states to create their
own poverty reduction plans tailored to their specific needs.
• Intensive blocks and districts receive comprehensive DAY-NRLM components
through various implementing bodies, while the rest are non-intensive.
21. The National Rural Livelihoods Mission (NRLM)
• The National Rural Livelihoods Mission (NRLM) is a poverty alleviation
programme. The Ministry of Rural Development, Government of India,
implemented it. The mission aims to promote self-employment and the
organization of rural poor.
22. The National Rural Livelihoods
Mission (NRLM
• The Deen Dayal Antyodaya Yojana – National Livelihoods Mission (DAY-NRLM) is
a government-run program.
• It aims to reduce poverty in rural India by creating sustainable livelihoods for
the poor. The mission was launched in June 2011 and is implemented by the
Ministry of Rural Development.
• The programme was renamed Deendayal Antayodaya Yojana in November 2015.
• The mission would try to provide shelters with critical services to the urban homeless
in stages.
• To reduce poverty and vulnerability of urban poor families by enabling them to
access profitable self-employment and skilled wage job possibilities.
• To result in a significant improvement in their livelihoods on a long-term basis by
developing strong grassroots-level poor institutions.
24. Inequality
• Inequality refers to the phenomenon of unequal and/or unjust distribution of
resources and opportunities among members of a given society
Inequality refers to the phenomenon of unequal and/or unjust
distribution of resources and opportunities among members of a
given society
25. Inequality: Incomes
Vertical Inequality
Difference between the rich and the
poor.
Horizontal Inequality
Where people of similar background,
status, qualifications, etc. have
differences in incomes
Caused by:
The Labour Market:
Differences in education,
qualifications, skills, abilities and
experience mean that the supply of
labour differs in relation to the
demand
The Tax System:
Impact of taxes that may be
regressive in their effect
Ability of some to be able to exploit
the system to pay less tax
Education:
Level of education and access to
education influences the level of
earnings
26. Inequality: Opportunity
The level of opportunity may influence the level of inequality
Access
How easy is it for individuals to access education, work, housing, etc?
How easy is it for countries to access markets?
Discrimination – on the basis of race, ethnicity, gender, etc.
27. Inequality: Assets
Not just the quantity but also the quality of assets can impact on inequality
Individuals – ownership of houses, cars, consumer goods, etc.
Countries
Access to raw materials, natural resources, infrastructure – roads, rail
telecommunications, etc.
Amount and quality of capital assets
Amount and quality of human assets
28. Inequality: Gender
• Evidence suggests women still paid less than men for the same job
• Some countries actively discriminate against women
• Men still dominate positions of power and responsibility
29. Inequality: Wealth
Differences in wealth – different to that of income
Income = flow
Wealth = stock
Wealth = houses, land, physical assets such as cultural items –
artwork, sculptures, etc.
Inherited wealth still a source of inequality
