There were a number of causes for the widespread poverty in India. One historical reason is the low level of economic development under the British colonial administration. The policies of the colonial government ruined traditional handicrafts and discouraged the development of industries like textiles. This resulted in fewer job opportunities and a low growth rate of incomes. This was accompanied by a high growth rate of population. The two combined to make the growth rate of per capita income very low. The failure at both the fronts: promotion of economic growth and population control perpetuated the cycle of poverty. Unable to find proper jobs in cities, many people started working as rickshaw pullers, vendors, construction workers, domestic servants, etc. With irregular small incomes, these people could not afford expensive housing. They started living in slums on the outskirts of the cities and the problems of poverty, largely a rural phenomenon also became the feature of the urban sector. Another feature of high poverty rates has been the huge income inequalities. One of the major reasons for this is the unequal distribution of land and other resources. Major policy initiatives like land reforms which aimed at the redistribution of assets in rural areas have not been implemented properly and effectively by most of the state governments. Since lack of land resources has been one of the major causes of poverty in India, proper implementation of policy could have improved the lives of millions of rural poor. Many other socio-cultural and economic factors also are responsible for poverty. In order to fulfill social obligations and observe religious ceremonies, people in India, including the very poor, spend a lot of money. Small farmers need money to buy agricultural inputs like seeds, fertilizer, pesticides, etc. Since poor people hardly have any savings, they borrow. Unable to repay because of poverty, they become victims of indebtedness. So the high level of indebtedness is both the cause and effect of poverty.
i. What are the reasons behind the huge income inequalities in rural areas?
ii. What are the economic and socio-cultural causes of poverty?
iii. What was the root cause of India's poverty historically?