HOLIDAY HOMEWORKTopic – Poverty as challenge for Indian economy

1.Introduction2.Victorian workhouse3.Causes for Poverty4.Poverty in Arab world5.Effects of Poverty6.Street Children7.Distribution

8.Political Map of India9.Indian Economy

Index

Poverty, economic condition in which people lack sufficient

income to obtain certain minimal levels of health services, food,

housing, clothing, and education generally recognized as

necessary to ensure an adequate standard of living. What is

considered adequate, however, depends on the average standard

of living in a particular society.

INTRODUCTION

Relative poverty is that experienced by those whose income falls considerably below the average for their particular society. Absolute poverty is that experienced by those who do not have enough food to remain healthy. However, estimating poverty on an income basis may not measure essential elements that also contribute to a healthy life. People without access to education or health services should be considered poor even if they have adequate food.

Victorian Workhouse

Workhouses, institutions that provided basic sustenance for the very poor, infirm, and aged, are most commonly associated with Victorian Britain. Conditions were deliberately bleak to deter people from turning to them for help.

Individuals who have a lower-than-average ability to earn income, for whatever reason, are likely to be poor. Historically, this group has included the elderly, people with disabilities, single mothers, and members of some minorities. In the West today, a significantly large group in the poverty-stricken population consists of single mothers and their children; these families account for about one-third of all poor people.

Causes for Poverty

Not only do women who work outside the home generally earn less than men, but a single mother often has a difficult time caring for children, running a household, and earning an adequate income. Other groups disproportionately represented below the poverty threshold are people with disabilities and their dependants, very large families, and families in which the principal wage earner is either unemployed or works for low wages.

Lack of educational opportunity is another cause of poverty. In the developed world, a larger percentage of blacks than whites are poor today, in part because of a heritage of inferior education, meaning reduced employment opportunities later.Much of the world's poverty is due to a low level of economic development. China and India are examples of heavily populated, developing nations where, despite substantial recent industrialization, poverty is rampant. Even in economically developed countries, widespread unemployment can create poverty.

The Great Depression impoverished millions of Americans and Europeans in the 1930s. Less severe economic contractions, called recessions, cause smaller increases in the poverty rate.A report by the United Nations Environment Programme (UNEP), known as GEO-2000, identified excessive consumption of energy, raw materials, and other resources in Western and some East Asian nations as one of the main causes of the continued poverty of the majority of world population.

Extreme poverty in many parts of the world forces residents of those areas to exploit natural resources in an unsustainable manner. Both factors have considerable economic and environmental implications.

The wealth of Saudi Arabia, based on the vast oil reserves discovered there, contrasts conspicuously with the poverty found elsewhere in the Arab world, as shown in this photograph of a poor neighbourhood.

Poverty in the Arab World

Tens of thousands of poor people throughout the world die every year from starvation and malnutrition. Infant mortality rates are higher and life expectancy lower among the poor. Poverty is closely associated with crime. Most of the poor are not criminals, and many criminals are not poor, but people from environments dominated by poverty are more likely to commit crimes and to be punished.

Effects of Poverty

Other social problems, such as mental illness and alcoholism, are common among the poor, in part because they are causes as well as effects of poverty, and often because there is little medical provision for dealing effectively with them. Finally, poverty tends to breed poverty; in some cases, the handicap of poverty is passed from one generation to another, possibly as a result of the family being caught in a poverty trap—a situation in which a relatively small

increase in income will take the family over the threshold for entitlement to benefits, thereby creating a net loss. One possibly consequence of this is that members of the household may be discouraged from seeking employment, losing the opportunities for social advancement that such employment might afford them.

Street Children

Street children of Bucharest, Romania. Of growing concern is the increase in child prostitution in all urban centres where poverty exists.

Poverty has been viewed as a measure of social class and sex inequality in industrial societies, with women and lower-class households experiencing the greater level of poverty. Similarly, poverty has been regarded as an indicator of inequitable economic dealings between the developed and the developing nations, with the poverty of the developing world being linked to the accumulation of wealth in the developed world—the so-called north-south divide.

Distribution

The United Nations Millennium Summit in September 2000 looked at issues of poverty distribution worldwide and set targets for 2015 that included reducing by half the number of people living on less than US$1 a day, providing safe drinking water for 50 per cent of people deprived of such access, primary education for all children, and reversing the spread of diseases such as malaria and AIDS.

The poorest nations in the world are in: South Asia (Bangladesh, India and Pakistan); sub-Saharan and North Africa; the Middle East; Latin America and the Caribbean; and East Asia (China).For 2020 a significant improvement in the circumstances of slum inhabitants and a greater access to modern technologies for poorer nations was also envisaged.

Political Map of India

Political

India has a mixed economy in which both the central and state governments pay a leading role—as regulators, planners, and through ownership of public enterprises. Large-scale government involvement in the economy began in the 1950s as a reflection of nationalism and of the socialism of the first post-independence government led by Jawaharlal Nehru—and with the aim of speeding up economic development and growth to meet the needs of India’s rapidly growing population. The first of India’s five-year

economic plans was launched in 1951.

Indian Economy

During the decades that followed the state took over certain key sectors and invested heavily in others, while the private sector was subject to wide-ranging controls. Tariff, and other, barriers were erected to protect domestic industries, and various agrarian reform programmes were initiated.. Economic growth, except during times of severe drought such as 1979 and 1987, was steady; it averaged 3.6 per cent a year in real terms (that is, after taking into account population growth) between 1965 and 1980, and more than 5 per cent a year during the 1980s.

Inflation and the national debt were generally kept low. Agricultural output rose significantly and the spectre of mass famine was eliminated. The basis of a modern industrial state was laid. However, growth levels were still too low to have more than a marginal impact on the income of the majority of Indians. In 2004 India’s gross national product (GNP) was about US$673,205 million, giving an income per head of just US$620.

In addition, more than 60 per cent of under-five were malnourished, while access to clean water and sanitation was still available only to a minority of the population.In 1991 P. V. Narasimha Rao became prime minister and instituted a significant change in economic policy. Many of the controls over the private sector have been abolished and the state monopoly in certain areas, such as air transport, was loosened. The economy generally was opened up by the reduction of tariff controls and by the encouragement of foreign investment.

These changes were partly brought about by the need to sustain higher growth rates. However, the government also needed to cut public spending and to reduce inflation, debt repayments, and the balance of payments deficit—which had all risen sharply as a result of problems created by the Gulf War and by government borrowing in the late 1980s. In 1991 and 1992 real economic growth dropped to 1.1 per cent; by 1996 it was above 6.5 per cent.Changes at national level have also been reflected at state level

Changes at national level have also been reflected at state level. The states have significant control over internal policy and interpret national policy in different ways. Some, like West Bengal, have far greater government control of the economy than average; others, like Maharashtra, have traditionally been more market-oriented. Since 1991, however, almost all the states have opened their doors to foreign investment, reduced controls over the private sector, and allowed some privatization of state companies. Some states have been more successful in this regard. Five major states, which together constitute one third of India’s population—Andhra Pradesh, Gujarat, Karnataka, Maharashtra, and Tamil.

Nadu—have secured two thirds of private investment proposals since 1991 and 60 per cent of commercial bank credit In contrast, seven states, which together constitute 55 per cent of the population, have secured only 30 per cent of private investment proposals during the same period. These are the states of Assam, Bihar, Madhya Pradesh, Orissa, Rajasthan, Uttar Pradesh, and West Bengal. This disparity may lead to instability in the future. In 2004 some 3.46 million tourists visited India, and spent an estimated US$1,713 million.

Made By : Himanshi

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