India’s Problem: Poverty or inequality

“In a country well governed, poverty is something to be ashamed of. In a country badly governed, wealth is something to be ashamed of.” — Confucius, Chinese teacher and philosopher

“An imbalance between rich and poor is the oldest and most fatal ailment of all republics.” — Plutarch, Greek historian

“The opposite of poverty is not wealth; the opposite of poverty is enough.” — Dr. Wess Stafford, President Emeritus of Compassion International

Poverty is not just lack of money; it is not having the capability to realize ones full potential of a human being : Amartya Sen

I believe that virtually all the problems in the world come from inequality of one kind or another. : Amartya Sen

I raise up my voice; not so I can shout, but so that those without voices can be heard.. We cannot succeed when half of us are held back. : Malala Yousafzai.

Building capacity dissolves differences. It irons out inequalities: APJ Abdul Kalam.

If socio economic inequality continues to grow in this proportion, then the benefits of the youth population, which considered a boon for India, can turn into curse. : Arvind K

Inequality is the root of social evil: Pope Francis.

The worst form of inequality is to try make unequal things equal. : Aristotle.

A nation will not survive morally or economically, when so few have so much, while so many have so little. : Bernie Sanders.

As long as poverty, injustice and gross inequality persists in our world, none of us can truly rest. : Nelson Mandela.

Inequality hardens society into class system. Inequality divides us from one another. Inequality undermines democracy. : George Packer.

Case Study

Amudha

Amudha is a 14-year-old student in 10th grade at a school in a small rural community near Madurai. She lives with her father, mother, sister, nephew and niece. Her father’s hand was broken while picking coconuts. This stopped him from working as a manual labourer. While he was recovering, he worked as a watchman and her mother became a construction worker. Both parents now work in construction. Her father earns Rs 400 per day and her mother earns Rs 350 and has severe knee and back pain due to the strenuous work.

Amudha’ parents cook with wood, unable to afford a liquid petroleum gas (LPG) cylinder. They have no drinking water or toilet facilities. They defecate in the open next to the pond. They obtain electricity from a neighbour’s supply. The meagre wages are not sufficient to maintain a family of six. Amudha’s mother dreams of hut of their own before she dies. Amudha’s elder sister was married at the age of 16 years but her mother wants Amudha to study more so that she can get a good job and salary to support the family. Amudha’s day starts at 6:00am.

She helps her mother at home and then walks to school. Her Government provided bicycle is broken and there is no money to repair it. The Prisoners of Hope Trust sponsors her education. After school, she attends remedial classes until 9:00pm. She then comes home for dinner. Later she helps her mother wash dishes and goes to sleep by 10:00pm. Amudha’s ambition is to become a doctor. Her mother lost two babies, giving birth at home with no access to medical care. Amudha wants to help rural women like her mother. She works hard to achieve this goal.

Kari

Kari is a 45-year-old woman who lives in her birthplace village in Bihar, India. She was married to her husband when she was 13, and they have a son and three daughters. The family is Hindu and belongs to the Musahar caste. During certain seasons, Kari finds agricultural employment related to the crop cycle, often walking 15 kilometers to work. Over time, her left hand has become partially paralyzed. Nonetheless, she strives to work as much as she can. She sows seeds and is occasionally employed by farmers in weeding, for which she is paid INR 25 a day – much less than the prevailing wage due to her disability.

During harvesting, she gathers the paddy and wheat crops. Being seasonal, harvesting work barely lasts for more than four weeks per year. She is paid in kind and can keep one-ninth of the produce that she helps to harvest. Overall, Kari works for less than two months annually, with no guarantee of daily employment. Her husband works half the year in Punjab, and their children have left home. Although proud of their children, Kari and her husband regret being unable to educate any of them due to needing “all hands on board”.

Short Poem: on Inequality, Shannon Perry

Females and Males are one in the world,

Although that is not the belief that has been furled.

We are told that one gender is better than the other,

It seems it’s just one stereotype after another.

Introduction

Addressing the Loksabha on the 75th anniversary of the Quit India Movement (2017), by 2022, when India will celebrate its 75th Independence Day, the PM called for Poverty Free India. Additionally, resolving COVID 19 crisis, the government said, 800 million poor Indians would be given free ration. Poverty is one of the many social problems that are detrimental to Indian Society. That is Injustice.

Poverty denotes a state in which life lacks necessities. Life survival is necessity, and bad is the man who does not have the means to save it. NITI Aayog performs an assessment of deprivation in India based on consumption expenditure.

Poverty has been described as a “pronounced poverty in well-being” condition and being poor as being hungry, lacking shelter and clothes, being sick and not being cared for, being illiterate and not being taught. Poor people are more vulnerable to out of control adverse events. They are also handled poorly by state and social institutions and in those institutions are excluded from the voice and influence.

Many of these poor people live in the countryside and have odd jobs to keep afloat. The lack of jobs in rural areas that provides a living wage pushes many Indians into fast-growing metropolitan areas like Mumbai, Delhi, Bangalore or Calcutta. Millions of households in India are passing deprivation to the next generation, rendering eradication of poverty almost impossible. Some parts of society have traditionally remained small, making us wonder poverty has become inherited.

Inequalities are deeper in human development. They are difficult, rather than hardship. A lot of people have no chance of a better future in India. They watch from the sidelines of society, without desire, meaning or integrity, as they see others move forward to ever greater prosperity. Some have fled extreme poverty, but others still do not have the ability or opportunities to manage their lives. Sex, ethnicity or the wealth of parents all too much still dictates the position a individual holds in society. Inequalities around employment, wellness, and resources can be seen. In India, inequalities in wealth, labor participation, and leadership positions can also be witnessed. This also bears witness to socioeconomic injustice. In the digital revolution, too, inequality can be observed.

Inequalities and injustice are evidence everywhere. There is the anxiety. Poverty and human development gaps are harming communities, undermining social stability and people’s confidence in government, institutions and one another. Many harmed societies, wiping out people from reaching their full potential at work and in life. We also make it harder for political decisions to represent the desires of society as a whole and protect the world, as today’s few moving forward flex their power to form decisions solely for their own interests. People will take the streets to the full.

Such human development issues are a roadblock to achieving the Sustainable Development Agenda 2030. They’re not all about income and wealth inequalities. They cannot be accounted for simply by using summary inequality measures which concentrate on a single dimension. And they’ll shape the opportunities for people living to see the 22nd century.

Perhaps particularly, the precise data on bad and widespread inequality should be collected. Governments must evaluate their schemes objectively, and deduce a strategy to combat it. India not only faces poverty, but also faces a beast of Inequality. We need multi-pronged approach to resolve both of the problems.

Incidence of Poverty

Each time we open the newspaper, or turn to a news channel, apart from the growing crime rate, there’s one more thing that’s popular to all, deprivation. No matter where one looks, the politically depraved cannot be turned a blind eye. Poverty is what unites us, with culture, class, caste, color and so many other things dividing us. Late Shri Arun Jaitley, then Indian Finance Minister, said in an interview with The Economic Times on 11 January 2019, “Poverty is a secular criterion, and it cuts through cultures and religions.”

Hegel once said: Poverty is a social phenomenon. Indigenous poverty has two facets: one social and the other socio-economic. Many that are economically poor are typically financially and educationally disadvantaged. In India deprivation is counted in absolute terms. Many economists, including Prof. Amartya Sen, and Jean Dreze, Suresh Tendulkar, N.C. Saxena, have highlighted the incidence of poverty. Tendulkar poverty line continues to be India’s reference point. It set Rs. 27.2 daily spending in rural areas, and Rs. 33.3 in urban areas.

There may be various causes of poverty, such as: pandemic (COVID 19), population growth , low agricultural productivity, inefficient use of energy , low rate of economic development, price increase, unemployment, lack of capital and interpreunership, social factors, colonial exploitation and climate factors, to mention but a few.

India is home to over 270 million people living in poverty. One in five Indians are bad. The 7 low-income states are home to 62 percent of poor Indians, and low-income states are home to just 45 percent of the Indians. Compared to 80 per cent of poor Indians live in rural areas. Uttar Pradesh has a low population of 60 million.

Poverty has significant impacts on health, employment and standards of living. These regions are affected largely because of the prevalence of deprivation.

Poverty rate is higher in rural areas than in urban areas. In rural areas poverty rate in 25% where as in urban areas poverty rate is 14%. Small villages account for 27% poor population, 19% poor in Big villages (5000 plus population), 17% poor in small town( less than 1 million) and mere 6% poor in big cities.

Incidence of poverty is also high in marginalized sections of the society. 21% poor belong to OBCs. while mere 12% belong to others. Only 28% of Indias population is SC and STs, where as they account for over 43% of Indias poor population.

Casual labor is the main source of income for rural poor, with nearly 50% of the rural poor employed in casual labor. Self-employment and casual labor is the main source of income for urban poor, 40% and 34% respectively.

Poor population spends more on food, fuel and light as compared to non-poor population in India. Poor person spends 56% on food, 13% on fuel and light. Whereas, Non Poor spends 47% on food and 9% on fuel and light. Poor also owns lesser number of assets. Only 61% poor owns mobile phone, while 90% urban owns a mobile phone. 30% poor owns a TV, whereas 65% of non-poor owns a TV. 27% Poor population had stove, while 61% of non-poor had. 5% poor owned a two wheeler, whereas 30% of non-poor owned. 2% of poor owned a refrigerator, while 24% of non-poor owned it. 0% of poor owns, washing machine PC/Laptop, or a four wheeler, non-poor owns 11%, 7% and 5% respectively.

Poverty impacts education too, with 45% poor population remains illiterate, 25% is literate or primary, 15% is middle schooled and mere 15% is secondary or above. This is in stark contrast with mere 26% illiterate amongst non-poor, 20% primary, 17% middle and 37% secondary and above.

In rural areas, nearly 90% of poor are landless and marginal land owners. Whereas 80% of non-poor are marginal land owners and landless.

Before SBM (Swach Bharat Mission), Access to toilets were also stark. Only 21% of poor had access to latrines whereas non poor had 62% access. Only 61% poor population had access to electricity, whereas over 85% of non-poor had access to electricity. Meager 6% poor has access to tap water, whereas 33% non-poor had.

Millions of households in India are passing deprivation to the next generation. Countries 200 poorest region, now known as aspirational districts, have benefited from an ambitious program to eliminate poverty since 1951, when the first five-year plan was developed. For an average of 150 plus development programs running in each district, these districts have since become the subject of all development plans in India. And the rate of deprivation in these districts indicates the prevalence of chronic deprivation in the districts in question.

Inequality issue demands greater attention as pure elevation from poverty won’t provide them with a decent standard of living. We must look at status of inequality present in India in depth to understand the challenges associated with it.

Inequality in India

India is a rapidly changing economy. Since 2005 its average national per capita income has more than doubled. Multidimensional poverty has been developing dramatically due to a combination of strong economic growth and social policies. Between 2005 and 2015 India’s number of multidimensionally poor people dropped by over 271 million. On average improvement among the poorest states and the poorest groups has been more rapid. Despite progress on indices of human growth, horizontal inequalities exist, and their dynamics follow the same trend as in the sense of human development’s vertical inequalities: major differences, fundamental convergence, and enhanced capacity divergence.

These groups have suffered from stigma and exclusion for centuries. Population with 5 or more years of education, 2015: ST (70% Male, 50% female), SC (78.7% Male, 60.7% Female), OBCs (83.1% Male, 66.3% Female) and others (87.1% Male, 77.9% Female). In case of Population with 12 or more years of education, 2015: ST (17.5% Male, 10. 6% female), SC (23.2% Male, 15.7% Female), OBCs (29.4% Male, 21.2% Female) and Others (38.7% Male, 30.4% Female).

Modern India has sought to address the inequalities legally by affirmative action, social discrimination and policies of reservation for such classes. There has been a reduction in inequality in key human development areas since 2005/06. For example, there is a convergence in educational attainment, with traditionally disadvantaged groups in the proportion of people with five or more years of schooling catching up with the rest of the population. Likewise there is convergence in cell phone connectivity and adoption.

Change in population with 5 or more years of education between 2005 and 2015: ST (18% Male, 20. 6% female), SC (13.3% Male, 20% Female), OBCs (10.4% Male, 17.8% Female) and Others (7.3% Male, 11.3% Female). This data indicates marginalized sections have improved more than other sections. Households with access to Mobile ST (77. 6%), SC(87.8), OBCs (92.0) and Others (94.7). Households with access to Mobile, change between 2005 and 2015: ST(72. 6%), SC(79.1), OBCs (77.4) and Others (66.2).

Even in improved areas of human growth, such as access to technology and 12 or more years of schooling, there has been an rise in inequalities: classes that were more competitive in 2005/2006 have made the most strides, and disadvantaged groups are moving ahead even, given success, are lagging further behind in comparative terms.

Change in population with 12 or more years of education between 2005 and 2015: ST (8.8% Male, 6.7% female), SC (9.8% Male, 9.4% Female), OBCs (10.8% Male, 11.4% Female) and others (11.1% Male, 10.5% Female). Households with access to computers ST (3.0%), SC (4.8%), OBCs (8.0%) and others (16.7%). Similary, change in computer access between 2005 and 2015: ST (2.3%), SC (4.0%), OBCs (6.0%) and others (10.2%).

Wealth inequality based on the income share of the top 10 per cent has risen in most regions since 1980, but at different levels. The top 10 per cent won an estimated 55 per cent of sales. In India, the bottom 40 per cent sales growth—58 per cent between 2000 and 2018—was significantly below average. The richest 1 per cent at the other end of the continuum saw their salaries rise slightly faster than the average since 2000 and since 2007. The top 1% share of national income rose from 5% in the 1980s to 22% in 2018 (based on the World Inequality Database).

In India, the average rate of income growth was 122 per cent between 2000 and 2018. The bottom 40% growth rate was 58%, while the highest 1% growth rate was 213%. Latest OXFAM study estimated that the top 1 per cent own more than four times the wealth owned by 953 million (70 percent of the population). The cumulative income of 63 Indian billionaires for fiscal year 2018:2019 is higher than the total Union Budget. It would take 22,277 years for a female domestic worker to earn what a technology company’s top CEO earns in one year. A tech CEO will make more in 10 minutes than a domestic worker would do in a year with earnings estimated at Rs. 106 per second. A minimum wage earner in rural India will take 940 years to earn what a top-paying executive earns in a year.

The measures of multidimensional gender social norms tend to be related to discrimination between the sexes. The net inequality is greater in countries with higher prejudices. The disparity can be calculated by the rate of maternal mortality(174), the proportion of seats in parliament (12%), the population with at least some secondary education (39% female versus 63.5% male), the rate of participation in the labor force (27% female and 73% male). India ranked 108 out of 149 countries according to WEF’s newly published gender wage gap index. Women in India earn less than men by 19 per cent. A man’s median gross hourly wage is Rs. 243, while it is Rs. 197 for women. Women and girls each and every day put in 3.26 billion hours of unpaid work, a contribution to the Indian economy of at least 19 lakh crore a year, which is 20 times India’s education budget in 2019. The situation in India alone isn’t bad, the world’s top 22 richest men have more money than all African women.

There are over 630 million Internet users in India. India now boasts the world’s second-largest Internet user base. India also has the lowest rates for mobile data, which in the last 4 years has encouraged a huge population to use the internet. Data consumption is also growing, in addition to pie size. The average Internet user now consumes more than 10 GB of data per month, which translates into 20 hours of video per month , compared with just 15 minutes in 2015. Yet for every Indian who has internet access, there’s at least one who doesn’t, it should be a matter of concern. The technological changes which unfold before our eyes will increase inequality.

The Industrial Revolution may have set humanity on a path to unparalleled betterment. Yet the Great Divergence opened up, too. Likewise, technological innovation will increase the gap between haves and have-nots. Rural people in India, 66% have an internet density of 25.3%, while 34% of urban population has an internet density of 98%. In the quality of internet connectivity, we also see significant variations in the access rates across the region. Remote mountainous regions of HP, sparsely inhabited Rajasthan deserts, and dense MP forests face greater digital exclusion. So, many of these places are home to tribal and oppressed peoples in India.

Hence poor communication will inadvertently exacerbate established disadvantages. Gender is another important factor, with just 20 per cent of Indian women using mobile and internet services, said a GSMA 2019 survey. Fundamentally the finance landscape is being reshaped, with non-financial tech companies delivering payment services. In India, JAM trinity has revolutionized government to individual, payment. Demonetization was thought to move India towards digital transactions, but the latest RBI study said that circulating currency has increased by 17%. Online transactions rose to 19.5 per cent in volume in 2018/19, but the digital economy has gained traction in metro, city and semi-urban belts to some degree. It has not spread to rural belts or the informal sector where the problem is financial illiteracy.

Impact of prevalent inequality

In places with high income inequality, the relation between the income of parents and their children is higher, i.e. , lower mobility of the intergenerational income. This relation is called the Great Gatsby Curve. The greater human development inequality, the greater the generational elasticity of the wage, i.e., the lower the mobility. Inequality limits versatility, as it generates incentives. It increases the income implications of intrinsic disparities between individuals; it also changes resources, rewards, and structures that form, grow, and distribute features and skills valued on the labor market; and it shifts the balance of power such that some groups are able to organize policies or otherwise promote the achievement of their children independently of talent.

Compared to the Great Gatsby Curve, areas with greater disparity in human growth have greater intergenerational continuity in education (a formula that measures the effect on the years of schooling of respondents of one additional year of parenting). This means that education rates in more unequal countries are stickier across generations (that is, there is less relative mobility). Education gaps begin during infancy, when parents are unable to take advantage of the ability to care for themselves. But institutions can play an important part in promoting mobility

Initiatives taken by government plus few suggestions

The Government has taken many measures to relieve the poverty traps of the poor population. Which include the Integrated Rural Development Programme, PM Swarojgar Yojana, Rural Awaas Yojana, Work Food Programme, National Old Age Pension Scheme, Annapurna Scheme, MGNREGA, NRLM, NULM, PMKVY, PMJDY (Jan Dhan Yojana), etc.

These initiatives have borne fruit too. India halved its poverty rate since 1990. Also wwe have uplifted 270 million people from poverty between 2005 and 2015. For the first time in 2018, Nigeria overtook India in total number of poor population. India is now, not the home to most poor in the world. Poverty estimation in India is carried out by NITI Aayog based on consumption expenditure not on income levels in India. Data of which is collected by NSSO. We want to eliminate prevalent poverty in the country but are truly unaware of the magnitude of poverty. Some reports suggest Indian rural poverty has shot up, while some reports suggest COVID 19 may double the poverty in India. Also the lack of official data from government increases the chasm between reality and hypothetical finding of numbers of poor. Indian government has proposed a national survey with new matrices to estimate poverty.

Estimates based on administrative tax data in India suggest that the top 1 per cent will have a share of income close to 20 per cent. Yet households record a share of income of about 10 percent, indicating that data from the household survey underestimate income at the top of the distribution. Survey numbers for household data do not represent true picture. To eliminate poverty, India needs to rise at least 8 per cent of GDP growth rate.

Conclusion

Poverty and injustice are twin evils that, since time immemorial, have plagued Indian society. These are impacting the marginalized parts of society. And fighting them is crucial for governments. Interventions need to understand both how to close the gap in the achievements of basic education and how to stop the persistent — or even increasing — divergence in more advanced education achievements. Poverty has an effect on all aspects of human life whether it is health, education or living standards.

Inequalities are seen in all ways, from the accessibility of different items, it is prevalent across gender too. Inequality requires greater focus as uplifting people from poverty is comparatively easy, but eradicating inequality is difficult.

Economic disparities are to a large degree a decision made by those with the option. Remedying them is a option, too. Technology may help to teach at the right level, for instance in allowing personally tailored content. One example of how technology can help in middle school grades is a technology led instructional Programme called Mindspark used in India. It benchmarks each student’s initial learning level, and dynamically customizes content to suit the level and rate of progress of the person.

Those with exposure to the system scored higher in Maths and in Hindi in just 4.5 months. For example, carbon pricing will minimize inequality if the revenue from a carbon tax is returned to taxpayers according to a budget-neutral principle called revenue redistribution.

Having the richest one percent in the next 10 years to pay only 0.5 percent extra tax on their income would be equal to the investment needed to create 117 million jobs in various sectors. Indian government as one of Digital India’s key pillars is pushing for universal access to mobile connectivity. It aims to achieve this by providing broadband connectivity to 250,000 village councils across the country.

What India requires is a systematic exercise guided by data to determine what factors cause the degree of exclusion and the reasons behind it. We can only devise tailored approaches to combat it when we truly grasp the beast of deprivation and injustice. We must see a dream for a more equitable India wherein no one is plagued with poverty and inequality is not seen. Jai Hind.