Poverty Alleviation Strategies

Four further features the Survey records. Wages are to be paid weekly, or at the latest within a fortnight of completion of work. The administrative expenditure ceiling rises from 6 to 9 per cent of total expenditure, to pay for staff, training and technical capacity. Gram Panchayats continue to implement at least half the work by cost, and plans are spatially integrated with PM Gati Shakti. All assets created are aggregated into a Viksit Bharat National Rural Infrastructure Stack.

How to write this in an exam. Set out MGNREGA and its economic design, because that is what the question is built on; then say that it has been statutorily overhauled by the 2025 Act, giving the four or five changes above. A candidate who knows only MGNREGA is answering a question about 2024.

Strategy three: self employment and livelihoods

Deendayal Antyodaya Yojana, National Rural Livelihoods Mission (DAY-NRLM). The approach is not a subsidy but an institution: organise poor rural women into self help groups, federate the groups, capitalise them, link them to bank credit, and build livelihoods on that base.

Its scale, from the Ministry of Rural Development as reported by the Survey, cumulative to December 2025.

Over 9 lakh community resource persons work at the grassroots in agriculture, banking, insurance and nutrition, and the mission's stated objective is that families in the network achieve food security and multiple stable income sources over six to eight years, with a target of 3 crore Lakhpati Didis, meaning women members whose household income reaches a lakh of rupees a year.

Samaveshi Aajeevika Yojana, launched under the same umbrella, applies the graduation approach: intensive handholding of the poorest households with asset transfer, training, consumption support and access to finance, until the household can sustain itself. The Survey cites evidence that beneficiaries of a comparable State programme kept a stable income even when casual work disappeared during the pandemic.

Why this strategy is the answer to a particular cause. It attacks indebtedness and the absence of institutional credit directly, and it does so through an organisation the household belongs to rather than a benefit it receives.

Strategy four: food and nutritional security

The National Food Security Act 2013 converted food from a scheme into a legal entitlement, and it has its own chapter, [Food Security: What It Means and How India Provides It]. Its place in a poverty answer is that it protects the largest item in a poor household's budget from the price rises that, as [The Causes of Poverty in India] explains, hit the poor hardest. The nutrition programmes, the midday meal in schools and the anganwadi services, do the same for children and also raise school attendance, which breaks the vicious circle at the education point.

Strategy five: social security, housing and direct transfer

Direct benefit transfer. Payment of benefits into a bank account rather than delivery of a subsidised good, resting on the identity, bank account and mobile combination. It reduces leakage and reaches the household rather than the shop.

Social security and insurance. Pension schemes for the unorganised sector, life and accident insurance at low premium, and health cover, which is the direct answer to the catastrophic health expenditure route into poverty.

Housing, water, sanitation, electricity and cooking fuel. These are not income programmes and they are what moved the Multidimensional Poverty Index, because the index measures exactly these deprivations. That is the point to make about them: they reduce measured poverty on a dimension that cash income would have taken far longer to reach.

Skill development, which acts on the productivity cause rather than on the income directly.

The strategies matched to the causes

A worked example: which strategy would have saved the household

Take Suresh and Ratna from [The Causes of Poverty in India], whose slide into poverty ran through a fragmented holding, an illness, a moneylender's loan and two children leaving school.

• Health cover would have stopped the 40,000 rupee loan at the point it was taken. This is the highest value single intervention for that household.
• A self help group would have offered credit at a rate the household could service, and a place to save in the years before the illness.
• The wage employment guarantee would have given Suresh paid work in the lean season instead of distress sale of the crop, and under the 2025 Act it would be 125 days rather than 100, with the works paused during sowing and harvest so that his own farm labour is not competed away.
• The food entitlement would have protected the household's grain consumption when the crop was sold to service the debt.
• The midday meal would have reduced the immediate cost of keeping the children in school, and the education would have broken the circle for the next generation.
• A recorded tenancy would have brought the income support and the crop insurance to the person actually farming.

What the example demonstrates. The strategies are not alternatives to be ranked; each closes a different door. That is the reasoning to give when a question asks whether India's approach to poverty has been correct.

Criticism, which a complete answer must include

Targeting errors, in both directions. Exclusion of eligible households and inclusion of ineligible ones. The self targeting design of a work guarantee avoids it, which is one of its main advantages; a benefit list does not.

Leakage. The Survey's own account of the reasons for overhauling MGNREGA, work not done, expenditure not matching progress, machines used on manual work, attendance systems bypassed, is a statement of the problem by the Government itself.

The proliferation of schemes. Very many programmes across many departments, each with its own identification, form and delivery. The convergence approach in the new Act and in PM-DDKY is an explicit response to it.

Delivery reaches the recorded person. The tenant, the migrant and the unregistered worker are precisely the poorest and the hardest to reach.

Employment programmes create assets of uneven quality, which is why the 2025 Act narrows the works to four priority areas and aggregates the assets into a national infrastructure record.

A guarantee is not a livelihood. A hundred, or a hundred and twenty five, days of unskilled manual work is a floor, not a path out of poverty. That is why the livelihoods mission and skill development exist beside it.

Quick revision

1. Five strategies: growth; wage employment; self employment and livelihoods; food and nutrition; and social security, services and direct transfer.
2. MGNREGA 2005: legal right to 100 days of unskilled manual wage employment per rural household. Its economic virtues are that it is self targeting and that it sets a floor under the rural wage.
3. The Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Gramin) Act, 2025 overhauls it: 125 days; four priority areas of water security, rural infrastructure, livelihoods and extreme weather and disaster works; disentitlement clauses removed; States may notify a 60 day pause in peak sowing and harvest; State wise normative allocation; Viksit Gram Panchayat Plans; wages weekly or within a fortnight; administrative ceiling 6 to 9 per cent; Gram Panchayats to implement at least half the work by cost; assets aggregated into a national rural infrastructure stack.
4. Why it was changed: work not done on the ground, expenditure not matching physical progress, machines on manual work, attendance bypassed, accumulated misappropriation, few households completing 100 days, and demand down over 53 per cent.
5. DAY-NRLM, to December 2025: 90.90 lakh self help groups, 10.05 crore households mobilised, 62,453.85 crore rupees of capitalisation support, 11.92 lakh crore rupees of bank credit accessed, 9 lakh community resource persons, target 3 crore Lakhpati Didis. Samaveshi Aajeevika Yojana applies the graduation approach.
6. Food: the National Food Security Act 2013 entitlement, plus midday meal and anganwadi nutrition.
7. Services moved the multidimensional index, because housing, sanitation, water, electricity and cooking fuel are its dimensions.
8. Criticism: targeting errors, leakage, too many schemes, delivery to the recorded person rather than the actual worker, uneven assets, and the fact that a work guarantee is a floor and not a livelihood.

Test yourself

1. Describe the strategies India has used to reduce poverty. Five, operating together. A growth oriented strategy, on the reasoning that sustained growth raises employment and wages and funds everything else. Wage employment programmes, culminating in a statutory guarantee of rural employment. Self employment and livelihood programmes built on women's self help groups under the Deendayal Antyodaya Yojana National Rural Livelihoods Mission. Food and nutritional security, made a legal entitlement by the National Food Security Act 2013 and supported by the midday meal and anganwadi services. And social security, public provision of housing, water, sanitation, electricity and cooking fuel, and direct benefit transfer, together with skill development. They are complementary rather than alternative, because the causes of poverty reinforce one another.

2. What was MGNREGA, and what are its economic merits? The Mahatma Gandhi National Rural Employment Guarantee Act 2005 gave every rural household a legal right to a hundred days of unskilled manual wage employment in a financial year, with an unemployment allowance if work was not provided within the stipulated time. Its economic merits are three. It is self targeting: because the work is unskilled manual labour at a notified wage, only those who need such work apply, so the poor need not be separately identified and errors of inclusion are minimised. It places a floor under the rural wage, since a private employer must offer at least as much to attract labour. And it provides work in the lean season, which prevents distress sale of assets and distress borrowing.

3. What changes has the Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Gramin) Act 2025 made? It raises the guarantee from a hundred to a hundred and twenty five days of unskilled wage employment per rural household per financial year. It replaces the scattered categories of permissible works with four priority areas: water security, rural infrastructure, livelihoods, and works to mitigate extreme weather and prepare for disaster. It removes the disentitlement clauses attaching to the unemployment allowance, strengthening the rights based character of the entitlement. It empowers States to notify pause periods aggregating sixty days during peak sowing and harvesting so that farm labour is available. It replaces unpredictable allocations with State wise normative allocation on objective development parameters. It requires wages to be paid weekly or at latest within a fortnight of completion of work, raises the administrative expenditure ceiling from six to nine per cent, requires Gram Panchayats to implement at least half the work by cost through Viksit Gram Panchayat Plans, and aggregates the assets created into a national rural infrastructure record.

4. Why was MGNREGA reassessed? Because of structural weaknesses the Government itself identified. Monitoring in several States found work not actually done on the ground, expenditure not matching physical progress, machines being used on works meant to be labour intensive, and digital attendance systems being bypassed; misappropriation accumulated over time. Only a small proportion of households completed the full hundred days after the pandemic, so the guarantee was not being realised in practice. And demand for work under the scheme had fallen by over half, which the Economic Survey attributes to workers moving to farm and other non scheme employment. The conclusion drawn was that the architecture had reached its limits, not that the guarantee should be withdrawn.

5. How does the self help group approach differ from a subsidy, and what has it achieved? A subsidy is a transfer to a household; the self help group approach builds an institution the household belongs to. Poor rural women are organised into groups, the groups are federated and capitalised, the federations are linked to bank credit, and livelihoods are built on that base with training and community resource persons. It therefore attacks the absence of institutional credit and the resulting indebtedness at their source, and it creates an organisation that persists after any particular scheme ends. Cumulatively to December 2025 the mission had promoted 90.90 lakh groups covering 10.05 crore households across 7,156 blocks, provided 62,453.85 crore rupees of capitalisation support, and enabled the groups to access 11.92 lakh crore rupees of bank credit, with over nine lakh community resource persons active and a target of three crore Lakhpati Didis.

6. Why did public provision of services reduce measured poverty faster than income growth alone would have? Because a large part of the measured decline is in multidimensional poverty, and the dimensions of that index are deprivations in health, education and standard of living rather than money: nutrition, child mortality, years of schooling and school attendance, cooking fuel, sanitation, drinking water, electricity, housing and assets. Those are supplied publicly rather than bought individually, so a programme that connects a village to electricity or provides a toilet and a gas connection removes several deprivations at once for every household covered, whereas income would have had to rise substantially and then be spent in that way. That is why the Multidimensional Poverty Index fell from 55.3 per cent in 2005-06 to about 11.28 per cent in 2022-23 while consumption based measures fell on a different path.

7. "India has too many poverty schemes." Comment. There is real substance to the criticism. A large number of programmes across many departments, each with its own eligibility, identification, form and delivery mechanism, imposes a heavy burden on the poorest households, who are the least able to negotiate it, and on administrative capacity at the block and panchayat level; it also makes evaluation difficult and duplication likely. The Government has itself responded to the point: the Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Gramin) Act 2025 is built around convergence and integrated Gram Panchayat plans, and PM Dhan Dhaanya Krishi Yojana converges thirty six existing schemes across eleven departments in each of a hundred districts. Against the criticism it must be said that poverty has several distinct causes, that a single instrument cannot address them all, and that the answer is convergence in delivery rather than a reduction in the number of objectives.