Why is India poor ?

It is probably an often thought question, but rarely answered correctly by most of the people. What makes a country like India poorer than a country like say America? I have tried to answer this question since I was a kid, then as an adult.

Lets see, most people might answer to that question as “India is poor because it lacks so and so “, the effect being something India does not have because its poor, and US has because its richer, and not a cause of Indian poverty. For example, some people might answer

“India is poor because it lacks infrastructure western countries have”, or

“India is poor because of lack of education among people”, or

“India is poor because its very corrupt, and it has politicians who manipulate people etc etc”.

The problem here is simple, almost all these answers are effects, India does not have the infrastructure of western countries because India is poor, it doesn’t need that infrastrucutre, you cannot spend Rs 500 million per year on a road which brings per user cost is Rs 5,000 per month, and the average salary of people using that road is Rs 10,000 per month. Why not? Because if you did build a luxury road like that for people this poor, you are wasting resources more than you are creating them. When India becomes richer better infrastructure will follow, even if govt is the only entity building it, they will have more money to spend on infrastructure. You cannot create prosperity by creating one effect and hoping other effect will follow.

Similarly, the stuff about Indian people being educated, well if you are going to work on a construction site for all your life(someone has to work there), there is no point in spending so much money on your education which could have gone towards creating more job opportunities for you. By trying to create this effect, by educating 100,000 workers who will be working on manufacturing all their lives, and then ending up with having jobs for only 60% of them isn’t really a better outcome.

A bit matured people who understand how things worked, they will come to the conclusion that India is poor because it has less money than America, therefore India is poor and America is richer. But then that was incorrect too when you will find out that Indian govt has the power to print any amount of money possible. Why can’t Indian govt print more money, give some to everyone and make everybody richer. Apparently its not that easy as it may sound, when money supply is increased, prices of commodities rise soon thereafter. So even if poor people are given a lot of money, that will just raise the prices of the various commodities they might buy thereby bringing them back to same level of poverty as before(more or less).