Poverty (India)

Reflections on Jaigaon: Poverty, Slums, and the Economic Horizon

March 13, 2009 — The street was littered as ever. A pack of sheep grazed on discarded paper, plastics, and spoiled fruits and vegetables. Along the roadside, polythene sheets were spread out to display Chinese electronics, coins, and clothes, while hawkers pushing carts (thelas) of bhel puri, peanuts, and coconut shouted out their offers. Taxis, tempos, and auto-rickshaws honked endlessly to carve a path through the dense crowd of people and vehicles.

Among the throng, young girls carried infant siblings balanced on their hips—one arm wrapped tightly around the baby, the other tugging at the shirts or pants of passing Apas and Amas to signal their presence in this bustling square.

While Bhutan rarely sees widespread begging, the border town of Jaigaon seems flooded with it. Awed by their reality, passing Bhutanese shoppers automatically hand out small change—anywhere from five to a hundred Ngultrums—to these children.

These children spend most of their days on the streets, returning to the slums at night. Their homes are makeshift huts crafted from polythene salvaged from town garbage dumps. I have even seen some residing in abandoned underground sewage tunnels in the suburbs. Most of these children have parents who hold regular jobs at construction sites, in local restaurants, or in red-light districts; the children are sent to the streets to earn extra income. Many of these families are believed to have migrated or been displaced from Bangladesh.

Whenever these children press for money, passersby instantly hand over whatever loose change they can find in their pockets or purses just to avoid a scene. But there is little escape: if you don’t give, they follow you; if you do, a dozen more join them.

Yet, Jaigaon remains a bustling paradise for enthusiastic shoppers, sellers, and hawkers alike. One can find practically anything here—from cheap street food to luxury vehicles—and if an item is out of stock, vendors deliver it the next day. As much as Jaigaon represents a vibrant example of local entrepreneurship, it is equally a sanctuary for displaced people struggling to survive, and an eye-opener for anyone unfamiliar with poverty up close.

Poverty and Slums in India: The Impact of a Changing Economic Landscape

The following section incorporates insights adapted from a column by Hari Sud—a former investment strategies analyst, international relations manager, and retired Vice President from C-I-L Inc.

Western media headlines often report that 25% of Indians live on less than $1 a day, while 70% live on less than $2. However, these metrics can be misleading because they fail to account for how money holds different purchasing power in different economies.

Using Purchasing Power Parity (PPP)—which evaluates income based on the cost of local goods and services—presents a more accurate picture. On a PPP basis, India’s lower-income tier effectively earns closer to $7 a day. While still low, it reflects a different economic reality than flat exchange-rate headlines suggest. Nevertheless, extreme poverty and urban slums remain critical challenges that breed hopelessness and require direct integration into broader economic strategy.

What Drives Urban Slums?

Urban slums are born from a vicious cycle: population growth, rapid rural-to-urban migration in search of work, low incomes, and a lack of affordable housing.

• Historical Migration: Following independence in 1947, expanding urban industries drew cheap labor from rural areas. Migrants built makeshift shelters near their workplaces. Over time, single structures grew into sprawling settlements of thousands.

• Political Patronage: Local political structures often provided rudimentary utilities (like basic electricity and water) to convert these settlements into reliable vote banks, institutionalizing unauthorized slums.

• Socioeconomic Diversity: Slums are not occupied exclusively by the destitute. Second-generation residents who have secured employment often remain because urban centers lack affordable formal housing.

Today, major urban hubs face significant housing deficits—Delhi, Mumbai, and Kolkata contain massive informal settlements, and even newer, planned cities like Chandigarh face similar pressures.

Can Economic Growth Solve the Crisis?

If sustained economic growth rates continue, per-capita GDP will rise significantly over the coming decades, generating millions of jobs in manufacturing, construction, and services.

However, structural transformation takes time:

1. The Short-to-Medium Term (Next 10–20 Years): Economic growth alone will not instantly erase slums. Rising urban populations could initially strain existing infrastructure further unless paired with aggressive urban renewal and low-cost housing development.

2. The Long-Term Outlook (25+ Years): As median incomes rise, families naturally transition into planned housing developments. Combined with rural economic growth—which slows desperate migration to cities—slum growth is expected to plateau and eventually decline.

Global Lessons: US, UK, and China

The struggle with urban poverty is not unique to South Asia:

• The United States: During the early 20th century, rapid immigration and post-Civil War migration created dense urban ghettos in cities like New York and Boston. Industrialization, postwar economic expansion, and large-scale infrastructure investments eventually absorbed these populations into formal housing and stable employment.

• Great Britain: Pre-industrial cities in Britain suffered widespread urban squalor. The rapid expansion of manufacturing during the Victorian era quadrupled national wealth and created widespread factory employment, gradually dismantling industrial-era slums.

• China: Post-1949 China controlled urban migration through the strict Hukou (residence permit) system, preventing rural squatters from establishing informal urban settlements. Modern state-led infrastructure investment transformed urban housing rapidly, though rural-urban income disparities remain.

Conclusion

Ending extreme poverty and urban slums requires a dual approach: sustained economic expansion paired with targeted urban housing policies.

While economic growth alone will not transform towns like Jaigaon overnight, long-term national prosperity remains the primary engine capable of providing rising generations with better alternatives, stable housing, and dignified livelihoods.