B.Com Ist Year Poverty Long Short Question Answer

BB.Com Ist Year Poverty Long Short Question Answer :- hii friends this post is very useful for all the student B.com, In this post you will find Business Environment Topic Wise chapter wise all the content Question Answer Notes Model Paper Examination Paper Sample Practice Paper PDF Download Hindi & English For Free.


Q.13. What is the concept of poverty ? Discuss the extent and causes of poverty in India.


What are the causes of poverty in India ? What steps, short-term and long-term can be taken to reduce the poverty in India ? (Meerut, 2013)

Ans. Generally, poverty is defined as a condition where a section of the society are not in a position to fulfil basic needs of life. The word poverty has following connotations:

(1) Absolute Poverty : Absolute poverty of a person means that his income or consumption expenditure is so meagre that he lives below the minimum subsistence level. He is not able to maintain his health and in fact he may be starving.

According to J. L. Hanson, “Poverty may be defined today as having insufficient income to provide what is now regarded as a minimum standard of living.”

(2) Relative Poverty : It is a state in which the position of a person or a family can be expressed in relation to others in the society. The people with lower incomes are relatively poor compared with those with higher incomes, even though they may be living above the minimum level of subsistence. This clearly depicts the inequilities of income in the society.

In Indian context, we are concerned with absolute poverty to understand the problem of poverty.


Poverty line may be defined as the per capita monthly expenditure needed to obtain the consumption basket corresponding to the calorie norms of 2400 per capita per day in rural areas and 2100 per capita per day in urban areas. Person consuming lesser quantity of nutrients, then this will be termed as living below poverty line. Poors of India are recognised on the basis of this poverty line.


The estimates of poverty in India are made on the basis of large national survey conducted by National Sample Survey Organization on consumer expenditure. These surveys are conductedat an interval of approximately five years on all-India basis. Estimate of poverty level in India can be shown from the following table:

Years Poverty Ratio
1973-74 54.9
1977-78 51.3
1983 44.5
1987-88 38.9
1993-94 36.0
1999-2000 26.1
2004-05 37.2
2011-2012 21.9

Source : NSSO Reports.

These estimates show a secular decline in the poverty ratio. though the number of poor remained stable for a long period of two decades (1973-93) mainly due to increase in population. Still 26-1 crore persons are not getting minimum needed food and cloth ete. which is a big problem and challange to all planners.


Several factors have acted to create the conditions of poverty in India. The following are the important factors responsible for the problem of poverty in India:

(1) Rapid Increase in Population : Rapid growth of population is important cause of the prevailing poverty in India. The annual addition to the population was more than the rate of economic growth in India. This adversely affects the growth of per capita income and per capita consumption. The addition to the number have eroded the consumption levels of the already poor • people.

(2) Unemployment : In our country, the labour force increased rapidly but the number of jobs did not rise that speed. Capital formation was inadequate, so enough productive jobs could not be created. The methods of production were more capital oriented and less labour-oriented. Labour intensive activities like agriculture, small-scale and cottage industries did not expand adequately. The number of unemployed persons has been increasing with every Five Year Plan. This is the main factor which is both a cause for poverty as well as the effect of poverty.

(3) Slow Growth of Economic Development: Development consists in the utilisation of all available resources natural and human. But such resources in India remain unutised or underutilised or misutilised to a large extent. Thus over all rate of production, and hence income, has been very low. This keeps the country poor

(4) Increase in Price Level: Rapid increase in price level is also the main cause of poverty in India. When price rises, the purchasing power of money falls and this affects the poor very much. Since 1951, the prices have been increasing. The poor could purchase less and less, so their standard of living falls. Poverty is reflected in the low consumption expenditure of the majority of the people in India.

(5) Inequality in Assets and Income Distribution : In India wealth is concentrated in a few hands while majority of the people live in poverty, hunger and disease. Unless the pattern of income distribution is altered, the object of removal of poverty will be distorted.

(6) Lack of Capital: The lack of capital and low rate of capital formation is also a main cause of poverty. Due to this, the level of income, output and employment remain very low and vicious circle of poverty detes continue.

(7) Underutilised Natural Resources : India has plenty of natural resources but due to lack of capital, entrepreeurial skill and technical knowledge, these resources have not been exploited fully. As a result and also because of increasing population, the per capita national income has not increased considerably.

(8) Natural Calamities and Famines : Indian econony is based on agriculture and agriculture is mainly depends on monsoon. But several parts of the country have either excess or scanty rainfall. This led to flood or drought or natural calamities. This affects the income of the poor people adversely.

(9) Social Factors : Social backwardness is also responsible for the poverty in India. Due to illiteracy, ignorance, blindfaith and orthodox, they incur heavy expenditure on social functions. Thus, they are indebted and remain poor throughout life.

(10) Political Factors: Being under foreign rule, India was exploited under the British regime. Since Independence, other political factors have adversely affected economic progress. The Indian admistration is known to be corrupt and inefficient. The legislators would not pass laws which may help the poor. Thus all factors have conspired to perpetuate poverty in India.


The following policies and measures should be adopted to eradicate poverty in the country: –

(1) Acceleration of Economic Growth : Employment generation and eradication of poverty can be possible through trickic down effect of economic growth. If in the strategy of growth higher priority is given to agriculture and cottage and smali industries, it will help in eradication of poverty. This is so because agriculture and village and small industries are labour intensive.

(2) Population Control: Population control is an essential pre-requisite for reducing poverty. If population growth is not checked, our progress would be like writing on sand on the sea-shore with the waves of population growth washing away all that we have written. The country must intensify its family planning campaign for the removal of poverty.

(3) Rural Public Works : To provide employment and for eradicating poverty, rural public works should be started on an extensive scale. With the help of rural public works, not only the idle man-power be given employment and their poverty removed but capital assets and infrastructural facilities for agriculture will also be built up.

(4) Social Equity : In view of Social Justice the distribution of income and wealth should be equitable. For this poor people should be provided such assets with which they can generate income. In India the most important asset, especially in the rural areas, is agricultural land. Ceilling on land holding should be implemented more effectively and surplus land should be redistributed to the landless. Technical knowledge, credit facilities and raw materials should also be provided to them.

(5) Rural Industrialisation : Rural industries with their small scale and simple technology offer much larger opportunities for employment and can become helpful for eradicating the poverty.

(6) Provision of Common Services and Social Security: lf the state spends large amounts on the provision of free common services like education, medical and recreation facilities to the masses, this will add to their real consumption and make them feel better off. The provision of social security to industrial labour in form of sickness, disablement, old age, provident fund, insurance benefits etc. has the similar effect of raising the consumption standards of the poorer section of the society.

(7) Integrated Rural Development Programme (IRDP): In the Sixth Five Year Plan, IRDP was launched on 2nd October, 1980. This programmed aims to alleviate rural poverty of selected families of landless labourers, small and marginal farmers, rural artisans, Scheduled Castes (SC) and Scheduled Tribes (ST) and socially or economically backward classes. Households below the poverty line are assisted through an appropriate package of technological services and asset transfer programmes. The programme covered minor irrigation, land development, animal husbandry and dairying, fisheries, forestry and horticulture with the aim of expansion of employment.

(8) The Scheme of Development of Women and Children in Rural Areas (DWCRA): It aims to improve the socio-economic status of the poor woman in the rural areas through creation of opportunities for income generating activities on a self-sustaining basis.

(9) Employment Generation Programmes : The government has adopted many employment generation schemes for eradicating poverty Sampoorna Grameen Rozgar Yojana (SGRY), Prime Minister Rozgar Yojana (PMRY), Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) are some of the important programmes to promote employment and remove poverty.

Short Answer Questions

Q.1. Distinguish between absolute poverty and relative


Ans. See Page 57

Q.2. Discuss the main causes of poverty in India.

Ans. See Page 58 and 59.

Q.3. Discuss the efforts made by government to alleviate poverty in India.

Ans. See Page 60.

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