Call Now

Get The App


Chapter 4 Poverty class 12th Commerce

Who are Poor?

Poors in urban areas

In urban areas, poor people include ragpickers, beggars etc. They resides in the kutcha house with walls made of baked mud and roofs of grass and woods. These urban poor are the overflow of rural poor who had migrated to urban area in search of alternative employment and livelihood.


Rural areas poor

In rural areas the poor people include the landless agricultural labor these landless labor engaged in variety of non- agricultural job or tenant cultivator with small handholding …..and most of the rural people even do not get to have even two meals a day …


1. Hunger malnutrition

2. Poor health

3. Limited economic opportunities

4. Bigger families

5. Dept trap


Hunger and malnutrition

  1. Hunger starvation and malnutrition: malnutrition is the basic problem of the poor people and malnutrition is high among the poor households.


Poor health

  1. Poor Health: in this the health of poor people is physically weak. Their children are less likely to survive or be born healthy .


Limited economic opportunity

  1. They have limited economic opportunities due to lack of literacy and skills.


Bigger families

  1. Big families: the poor families are bigger in size, which make their economic condition worse.


Debt trap

  1. O which it push them into the indebtness.


Gender Inequality: gender inequality prevails within the family in regards to participation of gainful employment. poor women receives less care on their way to motherhood..


Meaning of poverty

poverty refers to the state in which an individual is unable to fulfill even the basic necessities of life.


Types of poverty

There are two types of poverty

  • Relative poverty
  • Absolute poverty


Relative Poverty

Relative poverty refers to poverty of people, in camparison to other people, region or nation.

It helps in understanding the relative position of different segments of the population. And it only reflects the relative position of different segments of the population in the income hierarchy. it does not consider; how poor the poor person is or whether he is deprived of the basic minimum requirement of life or not….


Absolute poverty

Absolute poverty refers to the total number of people living below the poverty line…

The absolute poverty is relevant for he less developed countries like India, where there is abundance of poverty. it helps to measure the number of poor people….

The method of poverty line used to measure absolute poverty does not differentiate between the very poor and the other poor.


Poverty Line

Poverty line is a cut off on the line of distribution which usually divides the population of the country as poor and non-poor

So, There are many ways to categories poor:


Chronic Poor : Chronic poor: it include people who are always poor and who are usually poor.


Occasionally poor: Transient poor: transient poor is classifies as churning poor (who regularly move in and out of poverty line) occasionally poor (who are rich most of the time and poor sometimes)


Non poor: Non poor : they are never poor

How to determine Poverty line


Minimum calories intake:

The planning commission define the poverty line as a nutritional requirement says that 2400 calories per person per day for rural area and 2100 calories per person per day for urban area need to take.  These calories are fixed for the rural areas because the rural areas workers has to do grater amount of work as compared to the urban area worker.


Monetary value of minimum calories intake:

Poverty line divides the poor from the non-poor:

There are many kind of poor’s: Absolute poor, very poor and Poor whereas the nonpoor are also of many types middle class upper middle class the rich the very rich and the absolute rich… this poverty line hence divides the poor from the non poors. This method of determining the poverty line keeps on updating over the time to take care of changes in the price level……….


Causes of poverty

1. Population explosion

2. Low level of economic development

3. Poor state of agriculture

4. High literacy rate

5. High level of employment

6. High level of indebtedness

7. Inequalities of income

8. Inflation


Population explosion:

Rapid growth of population, particularly among the poor, is responsible for the problem of poverty in the country.


Low level of economic development

The Indian economy is highly underdeveloped due to relative backwardness of agricultural and industrial sectors. nearly 25 per cent of population is still living below the poverty line.


Poor State of Agriculture

Agriculture in India has continued to be backward due to use of primitive methods of production and fragmented small land holding. As a result, labour and land productivity continue to be low in India. Consequently, most of the farmers live in a state of poverty


High Illiteracy Rate

The weaker sections of society have to take up low paid jobs due to lack of knowledge mainly these people are scheduled castes and scheduled tribes


High level of unemployment

The urban poor in India are largely the overflow of the rural poor who migrate to urban areas in search of employment and a livelihood. Most of the urban poor are either unemployed or temporarily employed as casual labourers. Such casual laboures are among the most vulnerable in society as they have limited skills, with no job security, no assets and no surplus them. So, poverty is closely related to nature of employment.


High Level of indebtedness

Unemployment or under employment and the casual nature of work compels people to borrow money, that too at higher interest rates. Such indebtedness is one of the significant factors of poverty.


Inequalities of income

The unequal distribution of income and assets has also led to the persistence of poverty in India.



Inflation: The continuous rise in prices, particularly of essential commodities like food grains, has added to the miseries of the poor. Sharp rise in prices discourages the poor people to buy the food grain. As a result, it leads to the poverty in India.


Government Approach to Remove the Poverty

  • Growth Oriented Approach
  • Poverty elevation program
  • Minimum needs program


Growth Oriented Approach

  1. This approach was initiated in first five year plan .this approach is based on an expectation that effects the economic growth …
  2. However the growth oriented approach proved to be ineffective because :
  3. Population growth results in very low growth in per capita.
  4. Green revolution intensified the dispsrities between the large and small farmers.
  5. Unwillingness and inability to redistribute land.
  6. The benefit of economic growth did not trickle down the poor.


Poverty Alleviation program

  1. This approach was initiated in the third five year plan.


Minimum needs program

  1. this approach was initiated in  fifth five year plan .
  2. the main aim was to provide the basic needs to people .
  3. people standard of living should improve.
  4. To create employment opportunities and bring improvement in health and education sector …


Three major programme that aim at improving food and nutritional status of the poor are :

  • Public distribution system
  • Integrated child development scheme and
  • Midday meal scheme


Poverty Alleviation Program

  1. Self-employment program
  2. Wage employment program
  3. Self-employed program
  4. Rural employment generation program
  5. Prime minister rozgar yojana
  6. Swarna jyanti rozgar yojana
  7. Swarnjyanti gram swarozgar  yojana
  8. wage employment programme Sampoorna grameen rozgar yojana
  9. National food for work programme


Rural employment generation program

This programme was started by the government to create self-employment opportunities in the rural areas and small towns…It was implemented by Khadi and Village Industries Commission.


Prime minister Rozgar yojana (PMRY)

Under this programme, the educated unemployment from low income families in rural and urban areas were given financial help to them and also generates employment. PMRY attempted to generate employment by setting up 7 lakh micro enterprises during the eighth plan 1992-97. And By 2003 -04, 3 million people got employment under this scheme.


Swarna Jayanti Shahir yojana

Swarna Jayanti Shahri Rozgar Yojana

SJSRSY mainly aims at creating employment opportunities for both self-employment and wage employment in urban areas.


This programme seeks to provide gainful employment through encouraging the setting up of self-employment ventures or provision of wage employment.

It is centrally sponsored scheme, which is funded on 75:25 basis, between the Centre and the States.

Earlier, financial assistance was given to families or individuals under the self-employment programme. However, the government changed this approach since the 1990s through the programme “Swarnjayanti Gram Swarozgar Yojana


Swarnjayanti gram swarozgar yojana

SGSY aims at promoting micro enterprises and to bring the assisted poor families (Swarozgaris) above the poverty line, by organizing them into self-Help Groups (SHGs).Initially they are encouraged to save some money and lend among themselves as small loans.Later, though banks, the government provides partial financial assistance to SHG’s, which then decide, whom the loan is to be given, for self-employment activities.

Sampoorna Grameen Rozgar Yojana (SGRY): Aims to provide employment and food to people in rural areas who lived below the poverty line. thereby providing food security and increasing nutritional levels.

The SGRY will be open to all rural poor who are in need of wage employment and desire to do manual and unskilled work in and around his village/habitat. Wages were paid as a combination of food grains and cash.


National food for work programme

(NFFWP): This programme was launched in 2004 with the objective of intensifying the generation of supplementary wage employment.

The programme was implemented as a 100 per cent Centrally Sponsored Scheme.

This programme was incorporated in Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) in 2005.

MGNREGA aims at enhancing the livelihood security of people in rural areas by guaranteeing 100 days of wage-employment in a financial year to a rural household whose adult members volunteer to do unskilled manual work.

Explore All Chapters