1. Illiteracy: Independent India had very high rates of illiteracy just after independence. This was due to the fact that the Britishers did not spend commensurately on education and rather discouraged educational reforms. Over the years, the literacy rates rose but still as nearly 30 percent of the Indians are illiterate, they find it difficult to engage in well-paying economic activities and thus remain poor.

2. Unemployment: It is the second major reason of poverty. The people who don’t get work sit idle. Unemployment is basically because of unavailability of education which plays a vital role in the social as well as economic development of an individual.

3. Inequalities of Incomes: The unequal distribution of income is the other reason of poverty. Money has been rendered in few people’s hand and then they distribute it. One of the major reasons for this is the unequal distribution of land and other resources. Despite many policies, we have not been able to tackle the issue in a meaningful manner. Land reforms which aimed at redistribution of assets in rural areas have not been implemented properly.

4. Slow Growth of Employment Opportunities: There is slow growth of employment opportunities, especially in industrial sectors. On the other hand, population is growing day by day leading to growth of labor force without sufficient job opportunities. The failure at both the fronts: promotion of economic growth and population control, has perpetuated the cycle of poverty.