Socio-Economic Determinants of Rural Poverty: An Empirical Exploration of Jharkhand State, India

Abstract

Poverty has become a general phenomenon that is perceived to mean different things to different people at different times and places. India was the first country in the world to define poverty as the total per capita expenditure of the lowest expenditure class, which is required to ascertain a minimum intake of 2400 kcal/day in rural and 2100 kcal/day in urban areas. However, there exists a substantial interstate and urban rural differential in the cost of goods and services. One in three Indians lives below the poverty line according to the Tendulkar Committee report which used a measurement of goods and services, rather than calorie intake, to calculate poverty. The World Bank estimates that 80% of India's population lives on less than $2 a day which means a higher proportion of its population lives on less than $2 per day as compared with sub-Saharan Africa. World Bank identified Jharkhand as one of the most poverty-stricken state in the country with a sharp contrast between rural and urban poverty. Jharkhand is a tribal state which has high incidence of poverty. A majority of OBC, SC and ST population fall under BPL category due to a number of agro-climatic and socio-economic factors. BPL households often live misery and face poor quality of life as they lack the basic amenities. Poverty in the region leads to migration and both migration within the state and out-side state is common. Youth prefers to migrate out-side state but with increase in age within state migration picks up. A good proportion of rural households has connection with the commercial banks, cooperative banks and other financial institutions. The commercial banks have better reach among the rural households and they can be instrumental in poverty alleviation programmes. The important causes/determinants of rural poverty in Jharkhand can be summarized as; lack of education, poor land base with small and marginal land holdings. Lack of employment opportunities at local level and poor infrastructure compounds the problem. In addition to these factors, poor quality of natural resources like; acidic, laterite and red soils, water scarcity leading to mono-cropping in the state have also contributed towards rural poverty. With changing climatic scenario, and undulating terrain lacking capacity to retain rain water forces the farmers to take a single crop in the state, thereby reducing the opportunities to a better livelihood. Information and communication technologies can play a pivotal role as it the common means of seeking information for improved farming practices. People are using modern technologies like mobile phone for the linkage between people and institution for use of agriculture-related technology, knowledge, skills and information. Hence, the technological interventions can integrates farmers, agricultural scientists, extension workers, input dealers and the private sectors to harness the knowledge and information from various sources for better farming and improved livelihoods. There is a considerable potential for establishment of forest based processing units in state, can provide employment to local people and will reduce the migration phenomenon thereby enhancing the livelihoods of rural poor.