Model Answer
0 min readIntroduction
Poverty in India has been a persistent and complex challenge, attracting considerable debate among economists, policymakers, and social scientists. Before the economic liberalization of 1991, the understanding of poverty was largely shaped by socialist and welfare-state ideologies. Early discussions centered around land ownership, colonial exploitation, and the need for equitable distribution of resources. The post-independence era witnessed a shift towards planned development and state-led poverty reduction programs, but the definition and measurement of poverty remained contentious, evolving through various phases reflecting changing economic and political contexts. This answer will explore the key facets of the poverty debate in pre-liberalization India.
Early Debates & Colonial Era (Pre-1947)
The discourse on poverty in India predates independence, rooted in critiques of colonial economic policies. Early analyses, often by Indian nationalists and some British administrators, highlighted the ‘drain of wealth’ – the transfer of resources from India to Britain – as a major cause of widespread poverty. Dadabhai Naoroji’s ‘Poverty and Un-British Rule in India’ (1901) was a seminal work, arguing that British rule was the primary factor responsible for India’s economic decline and impoverishment. The focus was largely on structural issues like land revenue systems, de-industrialization, and the suppression of indigenous industries.
The Nehruvian Era & The Planning Commission (1947-1960s)
Post-independence, the Indian state adopted a planned development model under the guidance of the Planning Commission. Poverty was viewed as a consequence of structural inequalities and underdevelopment. The dominant approach emphasized state intervention, industrialization, and land reforms. The initial focus was on increasing national income, with the trickle-down effect expected to alleviate poverty. However, the definition of poverty remained largely qualitative.
- Early Poverty Lines: Initial attempts to define poverty were based on nutritional requirements. The All India Rural Credit Survey (1954) estimated a minimum calorie intake of 2250 calories per capita per day as a poverty line for rural areas.
- Mahalanobis Model: The Second Five Year Plan (1956-61), based on the Mahalanobis model, prioritized heavy industry, with the assumption that this would generate employment and reduce poverty in the long run.
The Emergence of Quantitative Measures (1970s-1980s)
The 1970s witnessed a growing emphasis on quantitative measurement of poverty. This was driven by the need to assess the impact of poverty alleviation programs and to refine policy interventions.
- Alagh Committee (1979): This committee provided the first official poverty line estimate at the national level, based on calorie intake and expenditure. It estimated that 5.1% of the population lived below the poverty line in 1977-78.
- Lakdawala Committee (1993): While its recommendations were implemented post-liberalization, the Lakdawala Committee built upon the work of the Alagh Committee, refining the methodology for updating the poverty line based on Consumer Price Index (CPI) data.
However, debates continued regarding the appropriateness of calorie-based poverty lines. Critics argued that this approach was inadequate as it failed to capture the multidimensional nature of poverty, including access to education, healthcare, and other essential services.
The Debate on Relative vs. Absolute Poverty
A significant debate revolved around the concept of relative versus absolute poverty. The official poverty line in India was based on an absolute measure – a fixed calorie intake. However, some economists argued for a relative poverty line, defined in relation to the average income or consumption level in society. This perspective highlighted income inequality as a crucial aspect of poverty.
Poverty Alleviation Programs & Their Effectiveness
The pre-liberalization era saw the launch of numerous poverty alleviation programs, including:
- Integrated Rural Development Programme (IRDP) (1978): Aimed at providing self-employment opportunities to rural poor.
- National Rural Employment Programme (NREP) (1980): Provided wage employment to the rural poor.
- Public Distribution System (PDS): Established to provide subsidized food grains to the poor.
Despite these programs, poverty reduction remained slow and uneven. Critics pointed to issues of leakages, corruption, and lack of effective targeting as major reasons for their limited success. The debate centered on whether these programs were genuinely reaching the intended beneficiaries and whether they were addressing the root causes of poverty.
The Limitations of the Pre-Liberalization Approach
By the late 1980s, it became increasingly evident that the pre-liberalization approach to poverty reduction had reached its limits. The slow economic growth, bureaucratic inefficiencies, and the lack of market incentives hindered progress. The debate shifted towards the need for economic reforms to accelerate growth and create more opportunities for the poor.
Conclusion
The poverty debate in pre-liberalization India was characterized by evolving definitions, measurement methodologies, and policy approaches. While early discussions focused on colonial exploitation and structural inequalities, the post-independence era saw a shift towards planned development and state-led poverty alleviation programs. Despite numerous initiatives, poverty reduction remained slow, prompting a re-evaluation of the existing approach. The limitations of the pre-liberalization model ultimately paved the way for the economic reforms of 1991, which aimed to accelerate growth and address poverty through a more market-oriented approach.
Answer Length
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