Poverty in India

Topics: Poverty, Poverty threshold, Poverty in the United States Pages: 8 (3045 words) Published: October 21, 2010
Poverty in India is widespread with the nation estimated to have a third of the world's poor. According to a 2005 World Bank estimate, 42% of India falls below the international poverty line of US$ 1.25 a day (PPP, in nominal terms 21.6 a day in urban areas and 14.3 in rural areas); having reduced from 60% in 1981.[1] According to the criterion used by the Planning Commission of India 27.5% of the population was living below the poverty line in 2004–2005, down from 51.3% in 1977–1978, and 36% in 1993-1994.[2] A study by the Oxford Poverty and Human Development Initiative using a Multi-dimensional Poverty Index (MPI) found that there were 421 million poor living under the MPI in eight north India states of Bihar, Chattisgarh, Jharkhand, Madhya Pradesh, Orissa, Rajasthan, Uttar Pradesh and West Bengal. This number is higher than the 410 million poor living in the 26 poorest African nations.[3] However, latest estimates by NCAER(National Council of Applied Economic Research), show that 48% of the Indian households earn more than 90,000 (US$2,025) annually(or more than US$3 PPP per person). According to NCAER, in 2009, of the 222 million households in India, the absolutely poor households (annual incomes below 45,000) accounted for only 15.6 % of them or about 35 million (about 200 million Indians). Another 80 million households are in income levels of 45,000-90,000 per year[4] Since the 1950s, the Indian government and non-governmental organizations have initiated several programs to alleviate poverty, including subsidizing food and other necessities, increased access to loans, improving agricultural techniques and price supports, and promoting education and family planning. These measures have helped eliminate famines, cut absolute poverty levels by more than half, and reduced illiteracy and malnutrition.[5] Contents [hide]

1 Poverty estimates
2 Causes of poverty in India
2.1 Caste system
2.2 British era
2.3 India's economic policies
2.4 Neo-liberal policies and their effects
3 Efforts to alleviate poverty
3.1 Outlook for poverty alleviation
3.2 Controversy over extent of poverty reduction
3.3 Persistence of malnutrition among children
4 See also
5 References
6 Further reading
7 External links
Poverty estimates

The World Bank estimates that 456 million Indians (41.6% of the total Indian population) now live under the global poverty line of US$ 1.25 per day (PPP). This means that a third of the global poor now reside in India. However, this also represents a significant decline in poverty from the 60 percent level in 1981 to 42 percent in 2005. The rupee has decreased in value since then, while the official standard of 538 (urban)/356 (rural) per month has remained the same.[6][7] Income inequality in India is increasing, with a Gini coefficient of 32.5 in 1999-2000.[8] However, according to the latest NCAER estimates, in 2009, only 15.6% of the households or 200 million people, had income levels less than 45,000 annually(US$ 1.4 PPP per person)[9].On the other hand, the Planning Commission of India uses its own criteria and has estimated that 27.5% of the population was living below the poverty line in 2004–2005, down from 51.3% in 1977–1978, and 36% in 1993-1994[2]. The source for this was the 61st round of the National Sample Survey (NSS) and the criterion used was monthly per capita consumption expenditure below 356.35 for rural areas and 538.60 for urban areas. 75% of the poor are in rural areas, most of them are daily wagers, self-employed householders and landless labourers. Although the Indian economy has grown steadily over the last two decades, its growth has been uneven when comparing different social groups, economic groups, geographic regions, and rural and urban areas.[5] Between 1999 and 2008, the annualized growth rates for Gujarat (8.8%), Haryana (8.7%), or Delhi (7.4%) were much higher than for Bihar (5.1%), Uttar Pradesh (4.4%), or Madhya Pradesh (3.5%).[10] Poverty rates in rural...
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