ThE GrEaTeST EViL

“The greatest of evils and the worst of crime is poverty…our first duty – a duty to which every other consideration should be sacrificed is not to be poor” - Bernard Shaw

Poverty, a word that been gazing humanity since its inception and has many connotations for different people. It may semantically be a single word but practically it is a chain of vocab that may range from hunger, illiteracy, low life expectancy to millions more. The repercussion of the word is wide and dire. For instance, hunger causes more deaths than any other common cause like AIDS, TB, hepatitis, malaria or any other disease discovered by men. It was assumed impossible to find potent anti-venom for this sanguine venom.

Bretton Wood conference, led to the establishment of World Bank and IMF, with an aim to take care of global developmental and macroeconomic issues respectively. It was an appreciable move & raised hopes of the poor and feeble; their rough face began to adore a thin smile, a smile that wasn’t bestowed to them by the Almighty itself. Backed by the hopes of billions, the World Bank planned its programs and priorities to help developing nations come out of the extreme poverty and nurture prudent methods to over come it.

Sixty years, after the caravan took off, it grew from 38 member nations to 184, from one subsidiary to five, from a few hundred dollars to billions. Every bit associated to it grew by leaps and bound. However, the head count of poor too shot up. Besides all its efforts, there remain several unanswered questions that are worth noticing. Like the sufficiency of funds, the aim behind market accessibility, the accuracy of data, etc remains arguable.

India, the focus of my discussion resides maximum number of underprivileged people in the world. It not even comes in top centurions when it comes to human development. Its economic ride in recent years has been acknowledged all over but its investment in social sectors (like education, health, family welfare etc) and infrastructure (roads, telecom, power, etc) is a placebo, which is far below the required levels. Bank group has increased its support and lending in recent years but the most of its aids are invested into infrastructure, while the social sectors are still under shades. Bank has invested heavily in primary education but has failed to achieve the set targets. All the dimensions that bank uses to track its efficiency is running over the danger mark. There are minor improvements in the conditions but are not looking to improve satisfactorily. India’s investment in health ranks lower than the low-income countries. GNI per capita income has doubled over last decades but poverty head count too has gone up.

Using the international poverty line of $ 1 per day purchasing power parity, about one-third of the world’s poor live in India. With some states of India larger than all but a few countries, one cannot be satisfied looking solely at all India aggregate but tracking its diversity. Almost half of the poor in India, approximately 133 million people, live in Uttar Pradesh, Bihar or Madhya Pradesh. Over one quarter of the poor live in rural India (World Bank CAS, 2004). There is no sign that the rates of growth were higher in the states where growth would have had greater impact on national poverty. Over the 14 major states the correlation coefficient between the growth rate in nonagricultural output per person from 1993-1994 to 1999-2000 and the weighted (absolute) growth elasticity of poverty is -0.10, which is not statistically significant at any reasonable level. This reveals the importance of reducing poverty in India, particularly in rural north India. World Bank’s strategy should give genuine attention to this densely populated area to get a marked improvement on global poverty charts.

If we look at the project portfolio of World Bank, there are around 17 active projects running under rural development. Out of which 2 are in UP, namely Uttar Pradesh Sodic Land Reform Reclamation and Uttar Pradesh Water Sector Restructuring. Madhya Pradesh also got 2, namely, Madhya Pradesh District Poverty Initiatives and Madhya Pradesh Water Sector. While in the poorest Bihar no project under this head. Interestingly, states like Karnataka, Andhra & Rajasthan got better chunk of funds than the poorest ones. Between them they share around seven of its rural development projects. Andhra and Karnataka are at the top because of their aggressive adoption of reforms. The portfolio reveals that Andhra got projects under head poverty reduction while states like UP, Bihar etc got none. Justifications, so forwarded are the poor governance and inability to adopt the reforms. Can such a reason become scapegoat to neglect such a huge population struggling to understand the meaning of India shinning or Aam Admi.

The pattern of India’s growth process in the post reforms era, can easily be interpreted that the regional imbalance is evident during the recent growth process as an important factor. (Baldwin, Martin & Ottaviano, 2001). It is also notable that agriculture as a whole has lagged the non-agriculture sector in 1990s; while India’s aggregate GDP grew at a rate of 6.7% p.a. over the period 1993-94 to 1999-00, agro and allied services grew at only 3.2 percent per annum. The importance of rural economic growth and agriculture growth in particular, to poverty reduction in India has long been recognized. The strategies (by World Bank or GoI) thus designed, shall recognize - “Achieving higher aggregate economic growth is only one element of an effective strategy for reconstruction and development of India. The sectoral and geographical composition of growth is also important, as is the need to redress existing inequalities in human resource development and between rural and urban India”.