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Indian Poverty
There are quite a few economies around the globe that aren’t doing very well, but one country’s economy is beginning to emerge as a potential powerhouse: India.

India is well acquainted with poverty and has been for many years now, with a large portion of the country’s population living in slums and other unsanitary conditions. Approximately 33 percent of the population lives in poverty, with only 62 percent of adults being literate, and only 49 percent of girls attending secondary school largely due to economic reasons.

The recent change in India’s economy could alter this. India’s stock market has reached new highs in recent months with a stable rupee.

Politics have had a large effect on India’s recent success, with the election of new Prime Minister Narendra Modi. Modi’s Bharatiya Janata Party, or BFP, experienced its first win in 30 years. The result is a more optimistic India that hopes to heal a broken bureaucracy.

Nicholas Smithie, Chief Investment Strategist at Emerging Global Advisors, says Modi is more likely to tackle major obstacles, such as a poor infrastructure, than previous prime ministers. Modi and the BJP work on a pro-growth platform, focusing on government approvals and advances in labor and education.

India might only be getting lucky. Certain aspects of the global economy—slowdown in China, money printing in Japan, Russia’s recession, stagnation in the European zones and falling oil prices—aren’t hitting India quite as hard. The deflation around the world is proving helpful to India, which has suffered high inflation. India has a rare opportunity to capitalize on new political officials and economic reform. International corporations are growing eager to invest in India, now assured that India’s policies will foster economic expansion.

As India’s economy emerges with a strong, stable foundation, the future of poverty reduction looks a little brighter. As the economy improves, families are better able to afford food, clean water and sanitary conditions. Educational opportunities are allowed to expand as the economy grows, creating a more secure future for Indian children, particularly girls. The path to recovery and to reducing poverty in India is long, but with a stronger economy and a hopeful leader, India seems to be on the right track.

Alaina Grote

Sources: The Economist, UNICEF, U.S. News

Photo: Flickr

poverty_in_india
India is the world’s largest democracy, and on May 12 it concluded a month-long national election process in which 814 million eligible voters went to the polls and selected 543 members of the lower house of parliament. In the election, Narendra Modi and the Bharatiya Janata Party claimed victory as the decade of dominance by the Congress Party came to an end. The high rate of political participation and voter enthusiasm amongst India’s population is promising, but the looming issue of poverty remains.

With a population of over 1.2 billion people spread out over 1 million square miles, India is the second most populous country in the world. However, according to many reports, poverty in India is widespread and nearly a third of the population is living in poverty. India’s Planning Commission estimated in 2013 that there were over 270 million people living under the poverty line. Other studies put that number closer to 310 million, but it is clear that no matter what the criteria, poverty remains a defining issue for India in the 21st century.

The World Bank estimates that 77 percent of India’s poor live in rural areas with 60 percent of Indians living in small villages with fewer than 5,000 people. The 77 percent in rural areas is comprised of nearly 240 million people, with the remainder of India’s impoverished amounting to over 70 million in urban areas. In recent years, rates of rural poverty in India have been declining, though the change has been attributed to urban migration and negligible advances in living standards. Similarly, India’s population growth has led to an increased poor population despite decreases in overall poverty rates.

Part of the problem seems to be Indian citizens’ relatively low access to health care. According to the World Health Organization, the life expectancy for Indian citizens, 64 years for males and 68 for females, is below the global life expectancy of 70. India’s infant mortality rate and education system is also a point of concern. Attendance at primary schools has become increasingly common for Indian children over the past decades but the adult literacy rate is 62.8 percent.

India’s government reported earlier this year that its economy grew by 4.6 percent in the first quarter of 2014. Positive economic growth has become common in recent years, but this figure is far from the regular 8 percent annual growth rate which India experienced before the global financial crisis of 2008. In the time since the crisis, investment has stalled and the rupee’s value has decreased as India’s national deficit has continued to grow steadily.

With the installment of a new prime minister with a pro-business mindset, only time will tell if India regains its pace for economic growth. The future looks promising but the reality of India’s alarming poverty is omnipresent. Nearly 70 years after gaining independence, India has attained political stability and is in the midst of coaxing economic stability to follow suit.

– Taylor Dow

Sources: Daily Mail, The Guardian, The New York Times, The Wall Street Journal, World Bank, WHO
Photo: The Independent India