Poverty Alleviation: RWG to Empowerment

Redistribution with Growth (RWG) – The Initial Approach

The RWG strategy, dominant in the 1950s-70s, posited that economic growth would generate sufficient benefits to ‘trickle down’ to the poor through increased employment and income. This involved policies like land reforms, industrialization, and investments in infrastructure. However, this approach faced several limitations:

• Unequal Distribution: Growth was often concentrated in certain sectors and regions, exacerbating income inequality.
• Limited Reach: The ‘trickle-down’ effect was slow and often did not reach the most vulnerable sections of society.
• Lack of Focus on Capabilities: The strategy largely ignored the importance of human capital development and social inclusion.

Growth-Mediated and Support-Led Security – A Shift in Focus

In the 1990s, the work of Amartya Sen and Jean Dreze brought a new perspective to poverty alleviation. They argued that economic growth alone was insufficient and that social security and public provisioning were crucial for ensuring basic needs and capabilities. This led to the adoption of policies like the Public Distribution System (PDS), the National Rural Employment Guarantee Act (NREGA – later MGNREGA in 2006), and various social sector programs.

Growth-mediated security emphasized creating conditions for growth that would benefit the poor, while support-led security focused on providing direct support to vulnerable groups through social safety nets. However, these strategies also faced challenges:

• Leakages and Corruption: Implementation of social programs was often plagued by leakages and corruption, reducing their effectiveness.
• Dependency: Over-reliance on social safety nets could create dependency and disincentivize work.
• Limited Empowerment: These strategies often treated the poor as passive recipients of aid, rather than active agents of their own development.

Empowerment, Opportunities, and Security – The Current Paradigm

The current poverty alleviation strategy represents a significant shift towards a more holistic and empowering approach. It recognizes that poverty is multi-dimensional, encompassing not only income deprivation but also lack of access to education, healthcare, and social inclusion. The core principles of this approach are:

• Empowerment: Providing individuals with the agency and capabilities to make their own choices and participate in decision-making processes. This includes promoting self-help groups (SHGs), strengthening local governance, and ensuring access to information.
• Opportunities: Creating economic opportunities for the poor through skill development, entrepreneurship promotion, and access to credit. Schemes like the Pradhan Mantri Kaushal Vikas Yojana (PMKVY) and the Start-up India initiative fall under this category.
• Security: Providing social security and protection to vulnerable groups through programs like the National Food Security Act (NFSA), the Pradhan Mantri Jan Dhan Yojana (PMJDY), and the Atal Pension Yojana.

Key Schemes Reflecting the New Approach

This approach also emphasizes convergence of different programs and schemes to maximize their impact. For example, linking MGNREGA with skill development programs can create more sustainable livelihood opportunities. Furthermore, the focus on data-driven decision-making, using tools like the Multidimensional Poverty Index (MPI), helps to identify and target the most vulnerable populations effectively.