Poverty alleviation programmes

The first principle

Poverty is not only a shortage of income; it is a shortage of assets, capabilities and bargaining power, which is why growth alone does not end it and why welfare schemes alone do not end it either. A household escapes poverty when three things move together: it earns more from work or assets, it is protected from shocks such as illness, drought and price rises, and it gains the health, schooling and voice to keep what it earns. Every approach India has tried, from trickle down growth to legal entitlements, is an attempt to move one or more of these three levers.

The core

How poverty is counted, in brief

Concepts and poverty lines are covered in the GS1 note on poverty measurement. The Tendulkar Expert Group (2009) put poverty at 21.9 per cent of the population in 2011 to 12, while the Rangarajan Expert Group (2014), using a higher consumption basket, put it at 29.5 per cent for the same year. No official consumption poverty line has been notified since, so recent debate relies on multidimensional measures and on World Bank estimates.

Four approaches to poverty

• Trickle down growth (1950s and 1960s). The early Five Year Plans assumed that rapid industrial growth would raise employment and wages and so lift the poor without special targeting. Growth stayed slow and land reform stalled, so the rural poor gained little.
• Direct attack on poverty (1970s and 1980s). The slogan "Garibi Hatao" in the 1971 general election and the Fifth Five Year Plan (1974 to 1979), with its Minimum Needs Programme, turned the State towards schemes aimed straight at the poor: the Integrated Rural Development Programme (IRDP, 1978 to 1980) for assets, and wage employment programmes such as Food for Work.
• Rights based approach (2005 to 2013). Laws turned benefits into legal entitlements that a citizen can claim and enforce: the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) 2005, the Forest Rights Act 2006, the Right of Children to Free and Compulsory Education Act 2009 and the National Food Security Act (NFSA) 2013.
• Multidimensional approach (2010s onward). Poverty is tracked as overlapping deprivations in health, education and living standards, and policy targets these directly through housing, sanitation, cooking fuel, electricity and bank accounts, delivered increasingly by direct benefit transfer.

The paradox of poverty

The paradox of poverty is persistent poverty amid plenty: a country with fast growth, surplus food stocks and rich mineral regions still has large numbers who are poor. The main explanation is inequality in the ownership of land and assets, because people who own nothing but their labour gain from growth only through wages, while returns on land, capital and minerals go to owners.

• Landlessness and failed land reform. Zamindari abolition removed intermediaries, but ceiling laws were evaded through benami and fictitious transfers, tenancy reform pushed tenants into informal leases, and little surplus land reached the landless. Scheduled Caste households in particular remain largely landless or marginal farmers.
• Asset concentration. Studies by the World Inequality Lab and others show the top tenth holding a large and rising share of income and wealth, so growth raises averages faster than the incomes of the bottom half.
• Resource rich, people poor. The mineral belt of Jharkhand, Odisha and Chhattisgarh is among the poorest parts of India, because mining displaced tribal communities without giving them a share in the wealth.
• Exclusion from scheme design. Programmes tied to land titles, such as Pradhan Mantri Kisan Samman Nidhi (PM KISAN), leave out tenants and landless labourers.

Dimensions

Multidimensional poverty

• The global index. The United Nations Development Programme (UNDP) and the Oxford Poverty and Human Development Initiative (OPHI) publish the global Multidimensional Poverty Index (MPI) using ten indicators across health, education and living standards. A person is poor if deprived in at least one third of the weighted indicators, and the MPI equals incidence (the share of people who are poor) multiplied by intensity (the average share of deprivations among the poor).
• Why incidence and intensity matter. Two districts with the same income poverty can differ sharply, since in one the poor may lack only electricity and in the other nutrition, schooling and sanitation together. Intensity shows depth, and the indicator breakdown tells policy which deprivation to attack first, which an income line cannot do.
• India in the 2023 global report. About 415 million people in India moved out of multidimensional poverty between 2005 to 06 and 2019 to 21, as incidence fell from 55.1 per cent to 16.4 per cent.
• NITI Aayog's National MPI. The National Institution for Transforming India (NITI Aayog) uses twelve indicators, adding maternal health and bank accounts. Its 2023 report found the headcount fell from 24.85 per cent in 2015 to 16 to 14.96 per cent in 2019 to 21, so about 13.5 crore people moved out. A discussion paper of January 2024 estimated 11.28 per cent in 2022 to 23 and about 24.82 crore people escaping between 2013 to 14 and 2022 to 23. In the 2023 report Bihar, Jharkhand and Meghalaya had the highest shares in 2019 to 21, while Uttar Pradesh, Bihar and Madhya Pradesh saw the largest falls in the number of poor.

Other dimensions

• Economic. World Bank estimates released in 2025 put extreme poverty in India at about 5.3 per cent in 2022 to 23, measured at the international line of $3 a day in 2021 purchasing power parity (PPP), though many households sit just above the line and fall back after a shock.
• Social. Poverty is concentrated among Scheduled Castes, Scheduled Tribes, landless labourers and female headed households, so caste and gender decide who is poor as much as region does.

In practice

Major programmes and their performance

• MGNREGA (2005, Ministry of Rural Development). It guaranteed 100 days of unskilled wage work a year to every rural household that asked, with work within 15 days or an unemployment allowance, one third of work for women, and Section 17 social audits by the gram sabha. It was a safety net in droughts and the Covid pandemic and women did more than half its person days, but wages were often late and real wages barely rose. In December 2025 Parliament replaced it with the Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Gramin) Act, 2025, which raises the guarantee to 125 days, lets states pause work for up to 60 days in peak farm seasons and shifts most states to a 60 to 40 Centre state cost share, a change critics say weakens the demand driven guarantee.
• Deendayal Antyodaya Yojana National Rural Livelihoods Mission (DAY NRLM, 2011). It organises poor women into self help groups (SHGs) and federations for savings, credit and livelihoods; see the Governance note on SHGs.
• Pradhan Mantri Awas Yojana (PMAY). The urban scheme (2015) and the rural scheme (2016, replacing Indira Awaas Yojana) fund pucca houses, often in women's names, and the rural scheme has built more than two and a half crore houses.
• PM Ujjwala Yojana (2016). It gave free liquefied petroleum gas (LPG) connections to women of poor households, now more than ten crore, but many families refill rarely because of cost, so firewood is still used.
• Jan Dhan (2014) and PM KISAN (2019). Pradhan Mantri Jan Dhan Yojana has opened more than 50 crore bank accounts, over half held by women, which made direct transfers possible. PM KISAN pays ₹6,000 a year in three instalments to landholding farmer families.
• NFSA (2013). It entitles up to 75 per cent of the rural and 50 per cent of the urban population to subsidised, now free, foodgrains; see the note on hunger and malnutrition.
• National Social Assistance Programme (NSAP, 1995). It pays old age, widow and disability pensions to poor households, but the Central share of the old age pension (₹200 a month, ₹500 above 80) has not been raised for more than a decade, so states top it up unevenly.

Welfare is not enough: prices and jobs

• Inflation is a tax on the poor. Food takes a large share of a poor household's budget and its income is rarely indexed, so food inflation cuts real income. Since the 2016 amendment to the Reserve Bank of India (RBI) Act, the Monetary Policy Committee targets consumer price inflation of 4 per cent with a band of 2 per cent either side, while buffer stocks and open market sales of grain steady food prices.
• Jobs are the lasting exit. The Periodic Labour Force Survey (PLFS) of the National Statistical Office (NSO) shows the unemployment rate for people aged 15 and above falling from 6.0 per cent in 2017 to 18 to 3.2 per cent in 2023 to 24, but much of the new work is self employment and unpaid family work. Employment intensive growth in labour heavy sectors such as textiles, food processing, construction and tourism, and support to micro, small and medium enterprises (MSMEs) through credit and market access, does more for the poor than transfers alone.

Issues and way forward

• Political will decides implementation. Programmes become showpieces when funds are released late, staff are short and success is measured by money spent rather than outcomes. States such as Rajasthan and Andhra Pradesh used MGNREGA far better than others in its early years under the same law, which shows the difference was will.
• Leakage and elite capture. Ghost beneficiaries, fake muster rolls and capture by local elites drained older schemes; Aadhaar linked transfers cut duplication, but failed authentication now excludes some, so offline fallback must stay.
• Design faults. Schemes tied to land titles miss tenants, pensions are too small, and many schemes work in silos. Converging them on the same household, as Kerala's Kudumbashree does through panchayats, works better.
• Accountability. Social audits are held irregularly in most states, so independent audit units, public data and penalties for delayed wages would restore the citizen's check.
• Assets and growth. Lasting progress needs land records and tenancy reform, skills and credit for MSMEs alongside stable prices.

Common confusions

• Incidence and intensity. Incidence is the share of people who are poor; intensity is how many deprivations the average poor person faces. The MPI multiplies the two.
• Global MPI and National MPI. The global MPI of UNDP and OPHI uses ten indicators and compares countries; NITI Aayog's National MPI uses twelve, adds maternal health and bank accounts, and ranks states and districts.
• Wage employment and self employment programmes. MGNREGA gave wage work on public works, as its 2025 successor does; DAY NRLM builds self employment through SHGs and credit.

For the exam

• Keyword bank: trickle down growth, Garibi Hatao, direct attack on poverty, rights based approach, paradox of poverty, asset inequality, Multidimensional Poverty Index, incidence and intensity, MGNREGA, social audit, PMAY, NSAP, flexible inflation targeting, employment intensive growth, political will.
• Practise the previous year questions on this topic →
• Use in an answer:
  • Introduction with data: "According to NITI Aayog, about 24.82 crore Indians moved out of multidimensional poverty between 2013 to 14 and 2022 to 23, yet the poorest states and groups still carry most of the remaining deprivation."
  • Introduction with a report: "The global Multidimensional Poverty Index of UNDP and OPHI found that about 415 million Indians left poverty between 2005 to 06 and 2019 to 21, showing that attacking deprivations directly can work faster than waiting for growth."
  • Conclusion: "Poverty programmes succeed when a legal entitlement is backed by funds, staff and accountability; without political will even a well designed law becomes a showpiece."
  • Conclusion: "Welfare can protect the poor, but only jobs, stable prices and a fairer spread of assets can make them less poor."