Rural and Urban Poverty

• Poverty is a state or condition which is characterized by a situation in which a person or community lacks the financial resources and essentials for a minimum standard of living.
• It means that the income level from employment is so low that basic human needs can't be met.
• Rural and Urban poverty are similar in nature characterized by low calories intake and low human development index quotient but are caused by different socio-economic disabilities.
• Policy failure in developing countries like India to counter vagaries of poverty is due to lack of clear demarcation of these two subjects.
• It has resulted in its chronic and cyclic nature. It still exists in major parts of rural and urban India despite various national and international efforts to combat this menace.
• Further due to Urbanization of poverty, both urban and rural poverty are inter-related as migration of rural poor causes  poverty in urban areas which is characterized by expansion of slums and economic division urban settlements.

Definition of poverty in India

Tendulkar Expert Group (2009)

• India's official poverty rates and estimates are based on Planning Commission's data which was derived from Tendulkar methodology. It was last estimated in 2009.
• An expert group was constituted under Suresh Tendulkar in 2005 and was constituted in order to review the methodology for poverty estimation.
• It submitted its report in 2009 and did not construct poverty line and adopted the officially measured urban poverty line of 2004-05 (25.7%) based on Expert Group (Lakdawala) methodology.
• The Tendulkar Committee suggested several changes to measure the state of poverty in India.
  • It recommended a shift away from basing the poverty lines from calorie norms used before it.
  • Instead of two separate PLBs for rural and urban poverty lines, it recommended a uniform all-India urban PLB across rural and urban India.
  • It also recommended to use Mixed Reference Period (MRP) based estimates, as opposed to Uniform Reference Period (URP) based estimates which was used in earlier methods for estimating poverty.
  • It also recommended to incorporate private expenditure on health and education while estimating poverty.
• It also validated the poverty lines by checking the adequacy of actual private consumption expenditure per capita near the poverty line on food, education and health by comparing them with normative expenditures which were consistent with nutritional, educational and health outcomes
• Instead of monthly household consumption, consumption expenditure was broken up into per person per day consumption which resulted in the figure of Rs 32 and Rs 26 a day for urban and rural areas.
• The national poverty line for 2011-12 was estimated at 816 per capita per month for rural areas and Rs. 1,000 per capita per month for urban areas.

Rangrajan Committee

• The report by the Rangarajan committee which had re-estimated poverty and submitted its report in mid-2014. Rangrajan commission recommended separate consumption baskets for rural and urban areas which include food items that ensure recommended calorie, protein & fat intake and non-food items like clothing, education, health, housing and transport.
• This committee had raised the daily per capita expenditure to Rs 47 for urban and Rs 32 for rural from Rs 32 and Rs 26 respectively at 2011-12 prices.
• Monthly per capita consumption expenditure of Rs. 972 was recommended in case of rural areas and 1407 in case of urban areas is recommended as the poverty line at the all India level.
• However, the report has neither been accepted by the government nor been used for any official allocation of funds.

Multidimensional Poverty Index (MPI) by NITI Ayog

• Recently, the government think tank NITI Aayog s envisaged bringing Multidimensional Poverty Index (MPI) for respective Indian states and based on those data, a State Reform Action Plan (SRAP) has been envisaged for differential approach to deal with different situations.
• This benchmark is based on Global MPI, which is an international measure which covers 107 developing countries and ranks them on the basis of multidimensional poverty.
• It was first developed in 2010 by Oxford Poverty and Human Development Initiative and United Nations Development Programme for UNDP’s Human Development Reports.
• It takes into account deprivations of health facilities, education and living standards, which are various forms of poverty and aggravates it.

Current Scenario of rural and urban poverty in India

Current definition of poverty

• Although, Lakadwala expert group had estimated rural and urban poverty separately, Tendulkar committee recommended a uniform measure of rural and urban poverty despite their variable characteristics and reasons.
• Further, after non-acceptance of Rangarajan committee report by government resulted in gap in poverty estimation process.
• Socio-Economic Caste Census (SECC) has provided the current reliable estimates by tracking the deprivation of households and address gaps effectively with focus on multi-dimensionality of poverty.
• The Sumit Bose Committee (2017) recommended using SECC 2011 data to identify beneficiaries for all centrally sponsored, central and state government schemes as far as possible.
• The consumption expenditure numbers which are reported by the National Statistical Office (NSO) is currently used to determine the state of rural and urban poverty in India.
• Consumption pattern of individuals as a parameter to estimate poverty because it is difficult to measure income of self employed people.

Differential nature of Indian and rural poverty

Major Causes of rural poverty in India

Agriculture Distress

• Poor farm mechanization, intensive agricultural practice, fragmented land holdings and erratic monsoon rainfall has reduced the productivity of Indian agriculture.
• Practice of rainfed agriculture in India has linked the fate and productivity of Indian agriculture with Indian monsoon which is often influenced by El-Nino and La-Nina events causing frequent droughts.
• Further, water-intensive agriculture in dryland areas and flood irrigation in rainfed areas often causes degradation of land.
• Apart from this, there large gap in forward and backward linkages in agriculture sector which has made this sector re vulnerable.

Overdependence on Indian agriculture

• More than 70% of the rural population is directly or indirectly dependent on agriculture and allied activities which contributes for 17% of GDP

Rural-Urban migration

• A large chunk of male population of villages migrates to cities search of better opportunities.
• According to Census 2011, about 450 million of the total population of 1.2 billion migrated within the country.
• 78 million population or 15.6% of all domestic migrants have migrated from rural to urban areas.
• Further, the flow of migrants has changed the population mix of the cities and rural areas.
• The number of dependents in rural India has increased who get small share of remittances from their relatives working in urban areas as marginal workers. This exposes them to poverty and destitution.

Ineffective implementation of government Schemes

• Although Panchayati Raj Institutions had been envisaged as more close to people at ground level, large scale corruption in implementation of schemes has diluted the motive which has resulted in rural poverty.
• Even schemes such as houses under Pradhan Mantri Awas Yojna, toilets under Swacch Bharat Abhiyant.c are difficult to be assessed by rural poor due to demand of token money (Climbing money).

Disguised and seasonal Unemployment

• In rural areas, whole family is involved in agriculture activities which are more than required. This causes problem of disguised unemployment.
• Agriculture is seasonal in nature as there is large gap between sowing and harvesting season.
• This leads to seasonal migration of agricultural labourers towards urban centers.

Inefficient Education System

• In rural areas there is lack of quality education and infrastructure causing increased illiteracy in rural society.
• India’s literacy rate is 74.0 percent in which the rural areas reporting a literacy rate of 68.9 percent while the urban areas have registered 85 percent literacy. It has resulted in an absolute difference of nearly 16 percentage points.

Caste System

• Caste system led to concentration of land and wealth in hands of upper caste in rural India. This is more visible as SC/STs have lesser landholdings than upper caste in rural areas.
• This parity often has excluded them from mainstream development and limited them as landless agricultural labourers than farmers.

Colonial Rule

• The colonial rule of the Britishers is ruthlessly destroyed our small scale and handicraft industries for mercantile purposes which were backbone of rural economy in pre-British India.
• Further, contemporary urbanization was reversed by British policies which resulted in over dependency on agriculture.

Green Revolution and impact on rural society

• The areas which were impacted by green revolution witnessed plight of smaller and marginal farmers, who were trapped in debt due to high input cost for procurement of agricultural machinery, fertilizer, pesticides e.t.c.
• This forced them to sell their land to pay debt and caused intra-regional poverty and formation of class society.

Steps Taken by government to mitigate rural poverty

Development of agriculture infrastructure

• Government has ensured promotion of ‘Integrated Farming System’ in rainfed areas to counter the vagaries of monsoon or unseasonal rain.
• It has also include Multi-tier cropping, bee-keeping, solar pumps, solar energy production in non-cropping season to help generating extra income during non-monsoon season.
• Zero-Budget Natural Farming has been promoted in this area to reduce the on-farm expenditure by farmers and check land degradation.
• Mega Food Parks have been established in order to broaden horizon of food processing sector.
• Sampada Yojna has been launched for integrated development of fisheries sector in India.
• Krishonnati Yojna has been launched as an umbrella scheme to cover all agriculture related schemes in an integrated way.
• Millet Village scheme aims to build model farms for dryland agriculture in India.
• PM-KISAN has ensured credit flow to farmers directly into their bank accounts. It has further increased investment in agriculture sector.

Development of non-agriculture infrastructure

• Pradhan Mantri Gram Sadak Yojana (PMGSY) has improved rural connectivity, by providing all-weather roads to connect eligible habitations in rural areas.
• It has also provided forward as well as backward links of farm to market and Mandis.
• National Cold Supply Chain and “Kisan Rail” have been proposed to be setup to provide better storage and transportation facilities for perishable agricultural goods.
• Refrigerated coaches in Express and Freight trains will be provided to transport perishable agricultural products.

Improvement in rural Health sector

• There is one PHC for every 30,000 of population which is available in rural areas which have been developed at block levels.
• These centers have five or six sub-centers staffed by health workers for outreach services such as immunization, basic curative care services, and maternal and child health services and preventive services.
• Further, Swachh Bharat Mission (Rural) has envisaged to provide clean water and sanitation which has resulted in Open Defecation Free (ODF) villages.
• It further envisages to improve the levels of cleanliness in rural areas through Solid and Liquid Waste Management activities.
• Aangawadi Kendras have been opened to provide basic health care activities include contraceptive counseling and supply, nutrition education and supplementation, along with pre-school activities for children
• Accredited social health activist (ASHA) have been recruited to pregnant women in nutrition related information and assist them to primary health care after labour pain.

Increment in Employment Opportunities

• The government is committed to provide employment opportunities under MGNREGA (Mahatma Gandhi National Rural Employment Guarantee Act) to end the problem of seasonal and disguised unemployment in rural areas.
• Rapid Infrastructure development in rural areas have further engaged rural work force in various employment opportunities.

Major Causes of Urban poverty in India

• There has been rapid increment in urban poverty. The urban population which was estimated at 17.29 percent in the 1951 Census almost doubled in percentage terms by 2011 (31.16 percent).
• Lucrative urban opportunities and failure of agriculture sector owing to erratic monsoon, lesser investment in agriculture sector and lower economic output has compelled a large chunk of Indian population to migrate to cities.
• This unsustainable urban growth has led to congestion in cities and caused problems of high traffic, sewage and waste disposal problems and increased pressure on pre-existing infrastructure.
• It has also introduced a large number of unskilled and semi-skilled labours causing poverty in urban areas.
• Development of slums, sanitation and drinking water problems, lack of clean atmosphere and more expenditure on health causes poverty in urban areas.

Lower Wages

• Due to availability of large number of unskilled and semi-skilled laborers, wages of urban poor is very low, leaving them with less money to invest on health and education.

Development of slums: Multiplier effect on multi-dimensional poverty

• Poor and unskilled workers who usually migrate to cities to counter disguised and seasonal unemployment in agriculture sector often live in low cost housing.
• Informal sector which is considered as a permanent feature of the urban economies in developing countries is characterized by low investment.
• It requires unskilled labour force. They depend on low cost housing due to lower per capita income.
• These informal sector enterprises are typically located in or around the slum areas in urban centers of developing and undeveloped countries where people are engaged in the informal sector and live in the slums.
• These slums are hotspots of illegal activities such as drug peddling, prostitution, child-trafficking and gambling which further aggravates the level of poverty.
• These slums are also hotbed of poor sanitation management and drinking water supply often causes spread of diseases more frequently than ever.
• This results in high expenditure on health of urban poor leaving them with less them with less money to spend on other important necessities.

Initiatives taken by government to combat poverty in Urban areas

Slum Management Programmes and housing sector initiatives

Pradhan Mantri Awas Yojana (Urban).

• Ministry of Housing and Urban Poverty Alleviation (MoHUPA) is committed to provide Housing for All by 2022 under Pradhan Mantri Awas Yojana (Urban).
• It seeks to address the housing requirement of urban poor including slum dwellers.
• The mission aims for rehabilitation of Slum Dwellers with participation of private developers using land as a resource under one of its provisions.
• It provides an interest subsidy of 6.5% on housing loans which can be availed by beneficiaries for 15 years from start of loan date.

Jaga Mission

• Jaga Mission was launched by Odisha government and has been recognized by World Habitat Mission for an ideal slum rehabilitation programme.
• It is the world’s largest slum land title project which has involved the government surveying and awarding slum dwellers a legal land title making them the owners of the land.
• It also uses drones to survey different slums and provided land titles to slum-dwellers, recognizing their rights.

Public Health Expenditure

• Concepts such as Mohalla clinics, which were launched by Delhi government has significantly diverted large number of patients with minor health issues from large hospitals, thus saved health expenditure Urban poor.

Clean Water and Sanitation

• Swachh Bharat Mission (Urban) which is implemented by the Ministry of Urban Development has components such as elimination of open defecation, conversion of unsanitary toilets to pour flush toilets, eradication of manual scavenging, municipal solid waste management and bringing about a behavioral change in people regarding healthy sanitation practices.
• It aims to cover 04 crore households, provide 2.5 lakh community toilets, 2.6 lakh public toilets, and a solid waste management facility in each town.
• Community toilets have been built under this programme in slums of urban areas.

Skilling Urban youths

• Deendayal Antyodaya Yojana-National Urban Livelihoods Mission NULM) provides for skill training of the urban poor to enable them become skilled and employable with better jobs.
• The scheme also provides training and boarding and lodging costs and assessment and certification fee of the candidates is borne by the government.
• Craftsmen Training Scheme, National Programme for Civil Services Capacity Building, Green Skill Development Programme e.t.c are other skill development programmes which aims to eliminate poverty in Urban India.

Conclusion

As the COVID-19 pandemic tests the resilience of rural economies in real time, the stakes for acting upon these insights are high. To best serve underprivileged urban and rural populations, the government needs to invest in solutions that uplift rural and urban communities as a matter of equity and resilience.