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The IUP Journal of International Relations

Projections for Poverty Elimination in India with Some Assumptions: Impact of Inequality

Article Details

Pub. Date	: Oct , 2022
Product Name	: The IUP Journal of International Relations
Product Type	: Article
Product Code	: IJIR021022
Author Name	: Kishore G Kulkarni, P Nandakumar Warrier and Rebecca Stephan
Availability	: YES
Subject/Domain	: Arts & Humanities
Download Format	: PDF Format
No. of Pages	: 14

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Abstract

The paper studies the relationship between poverty levels, per capita incomes and inequality by using a large sample of low and middle-income nations. The results, which indicate the requirement of a per capita income that is close to the one currently registered in Mexico for poverty removal, are used to predict the year of the "happy event" of poverty eradication in India. The tentative finding is that the portals to a better material life for the people of India may gradually open only in the early 2040. It is also observed that some countries like Azerbaijan and Kazakhstan have succeeded in poverty removal at low per capita income levels, which may be attributed to greater success in removing inequality and to praiseworthy performance in the realm of non-monetary indicators of poverty. The paper is, of course, based on some important rational assumptions such as absence of any other major shock such as Covid-19, and the continuous average increase in India's GDP by 8%. Therefore, this is an exercise in rationality with the absence of major external positive or negative shocks.

Introduction

Considerable attention has been given in development economics literature to the phenomenon termed as "the middle-income trap", a specter that seems to loom unfailingly in the path of nations striving to reach high status. In this context, it is relevant to consider another pitfall on the growth path, the "poverty trap". For, just as is the case of the so-called middle-income trap when countries get bogged down without completing the high-income GDP per capita level, the elimination of poverty can turn out to be an elusive goal sometimes, despite fairly high rates of growth.