Causes of poverty

1)RAPID GROWTH OF POPULATION :-

Population is increasing at a high rate whereas employment opportunities are not increasing. This results to unemployment and poverty in India.

2) INEQUALITY OF INCOME AND WEALTH :-

Unequal distribution of income and wealth among the people is called inequality. Wide inequality of income and wealth is an important cause for poverty in India. According to the planning commission , underdevelopment and inequality are twin causes of poverty. As per WORLD DEVELOPMENT REPORT 2001 the top 20% of the population shares 46% of the national income and bottom 20% share only 8.1% of the national income in 1997. The rich people exploit the poor to remain rich.

3) ILLITERACY :-

A considerable amount of population in India is illiterate and belongs to the category of unskilled labour force. The Indian education system itself is faculty. It is theorotical rather than practical , which has lead to unemployment and poverty.

4) VICIOUS CIRCLE OF POVERTY :-

It is said that, 'India is poor because it is poor'. T he operation of vivious circle of poverty has trapped indians into miseries of poverty , which in turn leads to low per capita income, low consumption , low savings which result in low production, low employment and low income.

5) INFLATION :-

Inflation means rise in general price level. The scarcity of goods and services on one hand and limited income on the other hand adds to the growing inflation. When price rise the purchasing power of the poor people falls, hence the poor becomes poorer.

6) REGIONAL DISPARITY :-

Regional disparity means unequal development among regions or states. Wide regional disparities exist in India, states like Punjab, Haryana, Maharashtra are rich states in terms of per capita income and overall development. On the otherhand states like Bihar, Rajasthan, Orrisa, Uttar pradesh are backword states.

7) SOCIAL FACTORS :-

Social factors like illiteracy , customs and traditions ,festivals, marriages and rural indebtness have contributed towards poverty. The social institutions like caste system, joint family system, religious faith have led to poverty in India.