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Poverty in India and China Essay


India’s slow rate of poverty reduction compared to China is due to the differences in their approach to the economy. Contrary to China’s, India’s economy is mixed which deprives the state of significant control in planning and execution of its policies. The differences in literacy levels and uneven distribution of per capita income also explain the slow rate in India. This essay shows reasons for this difference in poverty reduction rates.


India and China make up a substantial size in the continent of Asia, and are both of significance as far as globalization and the economy are concerned. They are on the forefront of countries undergoing rapid development. As a result of this globalization, they form a basis for studies as well as research on matters relating to economic growth and the factors that go along with it.

They give a clear picture in relation to policies, implementation, strengths and weaknesses of such policies as well as the impact on the general well being of the people. Poverty and its reduction are one such factor.

Poverty Reduction in India

Economic development in this sub continent has not been without it fair share of challenges. Improving the living conditions and general well being of the people is not only the ideal goal of an economy, but also a key indication of the viability of policies embraced in such development. India’s vast physical size massive population and high density of population distribution pose a challenge at a glance, especially because of the unevenness in wealth distribution (Deaton, 2003).

Being a mixed economy, the role of the expansive thus very significant private sector was at times not in line with the government planning leading to imbalances. This kind of liberalism went on unchecked, eliminating the possibility of implementation of policies that would have been more efficient in poverty reduction (Deaton, 2003).

Increase in structural development as well as rates of investment has seen the country’s G.D.P rise steadily from a meager 3.9 in the 1960’s to 9.3 between 2006- 2008 (Cornea, 2006).The wide gap between Per capita expenditure relative to income distribution is another avenue taken in efforts to create a balance in development, thereby leading to poverty reduction.

Bearing in mind that a majority of the people located in rural India wallow in poverty, efforts are targeted in these areas. An effort to ensure primary universal education reaches as many Indians as possible. Currently, the Indian education system is widely penetrative, and has enhanced inventions and innovations in such fields as medicine and mechanization which has gained international recognition (Cornea, 2006).

Generally, urban per capita expenditure exceeds that of rural areas, thus raising the need to come up with measures to create some sort of balance. Agriculture forms a crucial part of India’s economy, and the country has had to employ policies tailored around ensuring food security even to the low income earners. The country has also embarked on aggressive efforts to encourage investment in industrialization, although this move has not taken off at a faster rate.

These efforts by India lack extensive levels of success due to the lack of outright commitment and political goodwill which is, unfortunately, highly influenced by socio- cultural factors. This is further hampered by the fact that for long periods, the people of India have had a highly segregated social system that does not allow equal opportunities to everyone (Cornea, 2006).

Poverty Reduction in China

China’s economic development is dissimilar to that of India in many ways. To begin with, it is mainly state run. Most corporations are run by the state, which also plays the role of chief investor. The policies and approaches put in place by the state were such that they allowed greater balance and sustainability throughout China. Agriculture was also extremely vital to China’s efforts to reduce poverty. State land policies set a platform for agrarian revolution propelled by research and comprehensive investment in the sector.

The exploded and empowered population provided sufficient market for agricultural produce. This sector further provided employment opportunities for the Chinese people. Moreover, rural- urban migration of the Chinese itself brought about significant poverty reduction since the government set a clear platform for wealth creation and equal distribution (Bouch and Carl, 2004).

China also concentrated high investments on infrastructure development to facilitate the achievement of its highly ambitious development programs. This approach paved way for commendable success in its key economic venture- industrialization. Unlike many developing economies that mainly focus on industrialization to suit their local consumers, China embarked on mass production of industrial products for export.

With its chief markets being other developing countries, creation of employment for its vast population comprised mainly of skilled personnel further enhanced poverty reduction in unprecedented figures. In fact, China’s poor are mostly immigrants that have moved into the rural areas and have not been absorbed by the country’s economic set up (Bouch and Carl, 2004).

It is also worth noting that this export oriented production coupled with stringent control on the country’s imports promotes positive balance of its international trade, ensuring positive growth which enhances its ability to raise the living standards of its people. Moreover, it is worth noting that China’s population, although vast, has very high literacy levels.

This is due to the country’s sheer commitment in the provision of compulsory universal education. This kind of empowerment puts its people at the forefront as far as inventions and innovations are concerned. Readiness of the state and other investors to support such ventures also boosts poverty eradication measures (UNDP, 2004)

Reference List

Bouch, N. & Carl, R. (2004) The Macroeconomics of Poverty Reduction: The Case of China and India. Oxford: Oxford University Press.

Cornea, G. (2006) Growth and Inequality in an Era of Liberalization and Globalization. Oxford: Oxford University Press.

Deaton, A. (2003) Prices and Poverty in India. Economic and Political Review, 2(3): 21-23.

UNDP. (2004) Asia Pacific Regional Program on Macroeconomics of Poverty Reduction. Bangkok: United Nations Development Program.

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IvyPanda. (2019) 'Poverty in India and China'. 2 December.

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