Poverty Reduction in Indian Economy

Poverty Reduction in the Indian Economy

Overview

• Poverty reduction is a significant challenge for the Indian economy, with a large proportion of the population living below the poverty line.
• The Indian government has implemented various policies and programs to reduce poverty and improve living standards.

Poverty Measurement

• Poverty is measured using the Tendulkar Committee methodology, which considers a person poor if they spend less than ₹27 per day in rural areas and ₹33 per day in urban areas.
• The Rangarajan Committee methodology is also used, which considers a person poor if they spend less than ₹32 per day in rural areas and ₹47 per day in urban areas.

Poverty Reduction Strategies

• Rural Development Programs:
  • Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA): guarantees 100 days of employment per year to rural households.
  • National Rural Livelihood Mission (NRLM): aims to reduce poverty by promoting self-employment and entrepreneurship among rural women.
• Urban Poverty Reduction:
  • National Urban Livelihood Mission (NULM): aims to reduce poverty and improve livelihoods of urban poor through skill training and micro-enterprise development.
  • Deendayal Antyodaya Yojana-National Urban Livelihood Mission (DAY-NULM): provides financial assistance to urban poor for skill upgradation and entrepreneurship.
• Social Welfare Schemes:
  • Public Distribution System (PDS): provides subsidized food and other essential commodities to below poverty line (BPL) households.
  • Antyodaya Anna Yojana (AAY): provides highly subsidized food to the poorest of the poor.
  • National Food Security Act (NFSA): aims to provide food security to two-thirds of the population.

Poverty Reduction Achievements

• Poverty Rate Reduction: The poverty rate has declined from 37.2% in 2004-05 to 21.9% in 2011-12.
• Number of Poor: The number of poor has declined from 407 million in 2004-05 to 269 million in 2011-12.
• Human Development Index (HDI) Improvement: India's HDI ranking has improved from 131 in 2005 to 129 in 2019.

Challenges and Concerns

• Inequality and Exclusion: Poverty reduction programs often fail to reach the most vulnerable sections of the population, including SC/ST communities, women, and minorities.
• Quality of Education and Healthcare: Access to quality education and healthcare remains a challenge for the poor, hindering their ability to break out of the poverty cycle.
• Climate Change and Natural Disasters: Climate change and natural disasters can reverse poverty reduction gains and push people back into poverty.

Poverty Reduction in the Indian Economy

Poverty Overview

• A significant proportion of India's population lives below the poverty line, making poverty reduction a major challenge.

Poverty Measurement

• The Tendulkar Committee methodology defines poverty as spending less than ₹27 per day in rural areas and ₹33 per day in urban areas.
• The Rangarajan Committee methodology defines poverty as spending less than ₹32 per day in rural areas and ₹47 per day in urban areas.

Poverty Reduction Strategies

Rural Development Programs

• Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) guarantees 100 days of employment per year to rural households.
• National Rural Livelihood Mission (NRLM) aims to reduce poverty by promoting self-employment and entrepreneurship among rural women.

Urban Poverty Reduction

• National Urban Livelihood Mission (NULM) aims to reduce poverty and improve livelihoods of urban poor through skill training and micro-enterprise development.
• Deendayal Antyodaya Yojana-National Urban Livelihood Mission (DAY-NULM) provides financial assistance to urban poor for skill upgradation and entrepreneurship.

Social Welfare Schemes

• Public Distribution System (PDS) provides subsidized food and other essential commodities to below poverty line (BPL) households.
• Antyodaya Anna Yojana (AAY) provides highly subsidized food to the poorest of the poor.
• National Food Security Act (NFSA) aims to provide food security to two-thirds of the population.

Poverty Reduction Achievements

• The poverty rate has declined from 37.2% in 2004-05 to 21.9% in 2011-12.
• The number of poor has declined from 407 million in 2004-05 to 269 million in 2011-12.
• India's Human Development Index (HDI) ranking has improved from 131 in 2005 to 129 in 2019.

Challenges and Concerns

• Poverty reduction programs often fail to reach vulnerable sections of the population, including SC/ST communities, women, and minorities.
• Access to quality education and healthcare remains a challenge for the poor, hindering their ability to break out of the poverty cycle.
• Climate change and natural disasters can reverse poverty reduction gains and push people back into poverty.