UPSC Mains 2025 GS2 Q16: model answer

The 'paradox of poverty' is the coexistence of widespread poverty with abundant resources and fast growth. India is the world's fourth largest economy by size, yet millions remain poor because ownership of assets is concentrated.

Ownership inequality

• Land: Agriculture Census 2015-16: marginal holdings are about 68% of holdings but operate about a quarter of the area. Landless labourers depend on wages.
• Wealth: Oxfam estimated the top 1% hold over 40% of national wealth (2023).
• Social: SCs and STs own less land and capital; women rarely hold land titles.

Why ownership causes poverty

• Without collateral, the poor cannot borrow; growth gains go to asset owners.
• Rent and interest flow from poor to rich.
• Weak bargaining power keeps wages low.

Resource-rich, people poor

• Jharkhand, Odisha and Chhattisgarh hold much of India's coal and iron ore but have among the highest poverty rates.
• Mining displaces tribals while profits go elsewhere; this is the local 'resource curse'.

Remedies

• Land reforms, tenancy laws, women's titles (SVAMITVA records).
• District Mineral Foundations and Samatha (1997) principle of sharing.
• Asset creation through MGNREGA, credit through SHGs and Mudra.

Multidimensional poverty fell sharply, with NITI Aayog estimating about 25 crore people moving out between 2013-14 and 2022-23. Lasting progress needs wider ownership, not only transfers.