India and US and Globalization Term Paper

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India and U.S.: Poverty and Millennium Development Goals in relation to Globalization

India is selected as the welfare state under study in this paper, with a focus on poverty, one of the key Millennium Development Goals (MDG), and highlights the question of how globalization contributes to, or ameliorates poverty in India. The conditions in India are analyzed herein, and compared with those in the United States (U.S.). This paper concentrates on ascertaining the influence of globalization on penury (extreme poverty and/or destitution) in India. For that purpose, it is essential to first define both globalization and poverty, prior to evaluating the extent that globalization has impacted such poverty, if any.

Definitions: Globalization and Poverty

The appropriate beginning here is first to define our terms: specifically, what is globalization? One definition describes it as the interchange of culture, ideas, and products such that the result is international integration. In business terms, globalization is active when an AT&T customer in the United States (U.S.) calls for service and speaks to an AT&T representative whose office is in India or the Philippines. Similarly, when Apple products and/or parts are being made in China and then sold in the U.S., or the salmon you buy in the market has a label 'farmed in Thailand', this is globalization.

2. What then, is 'poverty'?

Poverty is both specific and relative -- it denotes a state wherein the individuals concerned lack basics that are essential requirements for 'normal' life, which would be water, food (adequate nutrition), shelter, an income, access to health care, and even education. There are those whose state of poverty is dire -- they may lack access to clean water on a daily basis and not have sufficient food to fulfill basic nutritional requirements. Yet, poverty can also be relative, as some individuals who would be considered in a 'state of poverty', say in the United States, might be considered as considerably above the poverty line for another country.

Perhaps the most significant factor affecting the economic conditions of most countries is globalization. In the nineteenth century, globalization was marginal as compared to the current century, where it is more significant and works more rapidly. The past five years has seen a decline in capital mobility, which is nevertheless high, with movement of trillions of dollars around the globe every day. Mobility of labor around the globe would perhaps be much higher, if more individuals had the access and ability to move from one location to another for employment. Movement of products and services around the globe takes place in record quantities, and such products and services penetrate deeper, with the aid of modern communication technology, into societies and economies than was possible previously (Winters). In large economies, the effect of globalization could be different for varying groups in the society such as rich, poor, disabled, women, urban and rural communities, and marginalized groups such as individuals of low castes or rural areas (Arora).

India is progressively being depicted as the 'poster state' of globalization (as cited in Arora). In part, this is because the government of India carried out extensive reforms in trade and other national arenas in 1991. These were aimed at improving internal policies and reducing controls to attain more integration with the global economy, and to accelerate economic growth. This is often denoted as globalization (Arora). However, in accordance with a recent committee constituted by the Indian Government for estimation of the nation's poverty, approximately 38% (380 million) of the population of India lives and/or has incomes below the poverty line (Singh, 2013). This manuscript discusses poverty in urban and rural regions of India, along with patterns of migration, and the effect(s) of globalization on many factors. These include: educational, economic and infrastructural development, poverty and the Indian pay scale, as well as Western culture's influence on India. All of these aspects compared with the analogous aspects for the United States. The paper concludes with a discussion of the viability of the Indian welfare state in times of increasing global interdependence.

3. Migration from rural to urban areas and its effect on poverty in both regions

This section explores migration from rural areas to urban areas in both India and U.S.A., and its influence on poverty with regards to both areas in both countries.

3.1 India

The past four decades has seen a drop from 3.79% to 2.73% in migration from rural regions to urban areas in India, with 30% of its total population residing in urban regions.

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With a total population estimating 1.02 billion, India has a poverty rate of 27% (Singh, 2007).

Figure 1. Urban Population Growth

(source: http://www.nationalstrategyforurbanpoor.org/yashada/html/urban_poverty/u_p_home.htm)

As shown in Figure 1, the onset of globalization in the last decade of the 20th century corresponds with the decline in growth of the urban population in India. A slight rise in poverty in urban areas was also observed in the period between the late 1960s and late 1970s. This relates to the initial migration from rural to urban territories during that period.

Figure 2. Poverty in India from 1955 -- 2000 (source: http://www.nationalstrategyforurbanpoor.org/yashada/html/urban_poverty/u_p_home.htm).

The graph, shown above as Figure 2, depicts that although 52.4% rural and 46% urban population were below the poverty line in 1970-75, these figures decreased to 27.1% and 23.6%, respectively, by 1995-2000. What is disturbing, however, is that though the numbers of the rural destitute decreased from 261.3 million persons to 193.2 million persons in the period cited, simultaneously. The urban destitute population increased from 60 million individuals to 67 million individuals (Singh, 2007). These statistics clearly demonstrate rapid movement of the indigent from rural to urban regions. From among India's population of 1.02 billion, as many as 30%, or 307 million individuals, were registered as being migrants from their place of birth. For the state of India overall, excluding Jammu and Kashmir regions, this proportion is slightly higher than the 27.4% registered in the year 1991.

Migration of business-oriented persons and laborers to urban regions from the country's rural areas for employment was the major cause of urban poverty (Singh, 2007). This proves to be a significant part of urbanization in developing nations. According to the National Sample Survey (NSS) 1999-2000, nearly 27% of the population of India was pronounced to be 'migrant'. Migrants are defined as those who have acquired 'migrant' status of residing away from home for a period of over 60 days during the previous ten years. Using this same definition, 16.3 million males and 1.4 million females in India were calculated as being migrants (Singh, 2007). Indian States such as Delhi, Punjab, and Goa showed a poverty level below 10%, while nearly half the population of Orissa (47%) and Bihar (43%) were poor (Singh, 2013). These figures are obtained from a new committee constituted by the Indian government for poverty estimation. Poverty has declined in areas where foreign investment or exports are growing (Singh, 2013).

In India, welcoming foreign investment is associated with poverty decrease. The capital market's rapid development has proven to be an important feature of the modern globalization process (Shenggen, Chan-Kang, and Mukherjee).

3.2 United States

The Poverty rate in the U.S., or the percentage of population deemed poor as per 'official definition', was 14.5% as reported in 2013; this marks a decline of statistical significance from the 2012 estimate of 15.0% (Thomas, 2015). The poverty rate decline over the second half of the 1990's is attributed to America's strong economy in the majority of the decade. This resulted in a historic low, record-tying 11.3% poverty rate in 2000 (tied statistically with the preceding lowest poverty rate of 11.1% in 1973). A congressional statement reported that poverty was concentrated more highly in some regions compared to others. It was almost twice as much in main cities as in suburbs; within metropolitan regions, poverty was found to be considerably higher in central locations of cities than in suburbs: 19.1% vs. 11.1%, respectively, as per 2013 estimates (Thomas).

As per a Census Bureau report (as cited in Arzaghi and Rupasingha), population in-flows, during the 1990s, were more than out-flows in non-metro locations. Identifying this trend's spatial differences, the report remarks further that approximately 6.2 million individuals migrated to non-metro regions, while roughly 5.7 million migrated away from non-metros from 1995 to 2000, a number that was still considerable (Arzaghi and Anil).

Though a larger proportion of the poverty-ridden population was located in urban zones, rural areas depicted more persistent and higher poverty rates (as cited in Mosley & Miller). Urban areas showed the highest poverty, from 18.7% in 2009, to 19.8% in 2010, and 20% in 2011 and 2012. In suburban regions, poverty dropped below 11% (2012), after dropping from 11.9% to 11.3% in 2010-11. Outside metropolitan locations, poverty increased from 16.5% (2010) to 17% (2011) and 17.6% in 2012 (Austin).

Infrastructural development and Poverty

One consideration in terms of globalization is the development of.....

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