Causes of Poverty in India

Poverty in a developing economy like India is rarely the result of a single cause; it typically arises from a combination of demographic, economic and social factors reinforcing one another.

• Population pressure: A high rate of population growth over a long period spreads limited resources — land, capital, public services — over a larger number of people, slowing the growth of per-capita income and making poverty reduction harder even when overall output grows.
• Unemployment and underemployment: A large section of the workforce either cannot find work at all, or is only partially/irregularly employed (underemployed), so many households simply do not earn enough to cross the poverty line even though members are technically "working."
• Low productivity in agriculture: Since a large share of India's workforce still depends on agriculture, and agricultural productivity per worker has historically been much lower than productivity in industry or services, incomes earned in agriculture tend to be low, keeping a large agriculture-dependent population near or below the poverty line.
• Unequal distribution of income and assets: Ownership of productive assets — most importantly agricultural land, but also capital and education — has historically been highly unequal in India. Because asset ownership strongly influences income-earning capacity, this inequality in assets translates directly into inequality, and often poverty, in incomes.
• Social factors: Social structures such as the caste system have historically restricted occupational mobility and access to resources and education for certain groups, entrenching poverty across generations for those excluded from better economic opportunities. …