Page 321 - Failure to Triumph - Journey of A Student

nation’s monetary authority, regulator and supervisor of the monetary system, banker to the
government, custodian of foreign exchange reserves, and as an issuer of currency. It is governed by a
central board of directors, headed by a governor who is appointed by the Government of India.

The rupee was linked to the British pound from 1927-1946 and then the US dollar till 1975 through
a fixed exchange rate. It was devalued in September 1975 and the system of fixed par rate was

replaced with a basket of four major international currencies – the British pound, the US dollar, the
Japanese yen and the Deutsche mark. Since 2003, the rupee has been steadily appreciating against the
US dollar. In 2009, a rising rupee prompted the Government of India to purchase 200 tons of gold for
$6.7 billion from the IMF.

Income and Consumption

India’s gross national income per capita had experienced astonishing growth rates since 2002. India’s
Per Capita Income has tripled from 19,040 in 2002-03 to 53,331 in 2010-11, averaging 13.7%

growth over these eight years. It further grew by 14.3% to reach 60,972 during 2011-12 fiscal.
Indian official estimates of the extent of poverty have been subject to debate, with concerns being
raised about the methodology for the determination of the poverty line. As of 2005, according to
World Bank statistics, 75.6% of the population lived on less than $2 a day (PPP), while 27.5% of the
population was living below the new international poverty line of $1.25 (PPP) per day. However,
data released in 2009 by the Government of India estimated that 37% of the population lived below

the poverty line.

Housing is modest. According to The Times of India, a majority of Indians had a per capita space
2
equivalent to or less than a 100 square feet (9.3 m ) room for their basic living needs, and one-third
of urban Indians lived in “homes too cramped to exceed even the minimum requirements of a prison
2
cell in the US." The average is 103 sq ft (9.6 m ) per person in rural areas and 117 sq ft (10.9 m ) per
person in urban areas.

Around half of Indian children are malnourished. The proportion of underweight children is nearly
double that of Sub-Saharan Africa. However, India has not had any major famines since
Independence.

Since the early 1950s, successive governments have implemented various schemes to alleviate
poverty, under central planning, that have met with partial success. All these programmes have relied

upon the strategies of the Food for work programme and National Rural Employment Programme of
the 1980s, which attempted to use the unemployed to generate productive assets and build rural
infrastructure. In August 2005, the Parliament of India, in response to the perceived failure of
economic growth to generate employment for the rural poor, passed the Rural Employment
Guarantee Bill into law, guaranteeing 100 days of minimum wage employment to every rural
household in all the districts of India. The Parliament of India also refused to accept Union
Government’s argument that it had taken adequate measures to reduce incidence of poverty in India.
The question of whether economic reforms have reduced poverty has fuelled debates without

generating clear- cut answers and has also increased political pressure against further economic