Over the years, India has grappled with the complex challenge of poverty, prompting numerous attempts to gauge its prevalence and track changes over time. While various estimates have been proposed, they consistently suggest a decline in poverty levels, reflecting the nation’s commitment to economic development and poverty alleviation. This essay critically examines the veracity of such assertions, particularly with a focus on urban and rural poverty indicators. The multifaceted nature of poverty necessitates a nuanced analysis that considers the distinct dynamics at play in urban and rural settings. Urbanization and industrialization have brought about significant economic transformations, impacting poverty in diverse ways. In urban areas, factors such as employment opportunities, access to education, and healthcare facilities play pivotal roles in shaping the poverty landscape. Conversely, rural regions confront challenges related to agrarian livelihoods, land reforms, and infrastructural development. By scrutinizing these dimensions, this essay aims to unravel the complexities of poverty in India, evaluating the effectiveness of policies and interventions in addressing the unique challenges posed by both urban and rural contexts.
Tag: Issues relating to poverty and hunger.
Contents
Decoding the Question:
- In the Introduction, you can start with the background of the poverty estimates in India and mention the definition of poverty and the poverty estimation approach in India.
- In Body, try to highlight approaches of earlier Committees on the estimation of poverty and then do a critical examination of different estimates of poverty in India.
- In Conclusion, suggestions like India can think of FAO’s implementation mechanism, etc.
Answer:
Poverty means that the income level from employment is so low that basic human needs can’t be met. The poverty estimates in India have consistently reflected a divergence from the rest of the indicators of well-being such as under-nutrition among children, underweight children, chronic anemia among women, malnutrition among women, and other consequent health indicators, specifically in the last two decades, which show worsened nutritional situation. Such divergence called for a closer look at the methodology involved in arriving at the threshold ‘poverty line’ and has been debated since.
According to the World Bank, Poverty is a pronounced deprivation in well-being and comprises many dimensions. It includes low incomes and the inability to acquire the basic goods and services necessary for survival with dignity.
Approaches of Earlier Committees on Estimation of Poverty:
- The Working Group 1962: Recommended that the national minimum consumption expenditure for a household of five persons should not be less than Rs 100 per month or Rs 20 per capita per month in terms of 1960-61 prices. For urban areas, this figure was Rs 125 per month or Rs 25 per capita per month to cover the higher prices there. This poverty line was widely used in the 1960s and 1970s to estimate the poverty ratio at the national and state levels.
- Alagh Committee 1979: This committee estimated average calorie requirements and the poverty line corresponding to the calorie requirement. The estimated calorie norm was 2400 kcal per capita per day in rural areas and 2100 kcal per capita per day in urban areas.
- Lakdawala Committee in 1989: They did not redefine the poverty line. The Committee retained the one defined by the Alagh Committee which was at the national level in rural and urban areas. This Committee disaggregated these national poverty lines into state-specific poverty lines to reflect the inter-state price differentials.
- The Expert Group under the chairmanship of Suresh D. Tendulkar in 2009 did not construct a poverty line. It adopted the officially measured urban poverty line of 2004-05 based on the Lakdawala Committee’s methodology and converted this poverty line into MRP consumption.
- The C. Rangarajan Committee in 2011 redefined the poverty line. According to the report of the committee, the new poverty line should be Rs 32 in rural areas and Rs 47 in urban areas.
Critical Examination of Several Different Estimates of Poverty in India:
- The Lakdawala Committee did not provide major changes from the existing methodology in its recommendations and asked to follow the calorie-based methodology for deriving the ‘poverty line’ without making changes in the existing consumption basket, it suggested a minor change.
- A committee appointed under the chairmanship of Suresh Tendulkar attempted to change the composition of the existing consumption basket to take into account the real needs of the poor people. The method of using the urban consumption basket for 2004-05 for both rural and urban areas is riddled with problems as it does not consider the several socio-economic differences in consumption patterns of rural and urban India.
Reduction in poverty levels over time:
- The percentage of the population living below the poverty line in India decreased to 22% in 2011-12 from 37% in 2004-05, according to data released by the Planning Commission in July 2013.
- A new (International Monetary Fund) IMF paper released on Tuesday, titled ‘Pandemic, Poverty, and Inequality: Evidence from India’ says that ‘extreme poverty was maintained below 1% in 2020 due to Pradhan Mantri Garib Kalyan Ann Yojana (PMGKY).
- The paper argues that the incorporation of the food subsidy data has helped it conclude that the ‘official poverty line’ must be moved from (Population living on <$1) PPP $1.9 to $3.2. In terms of rupees, moving from 865 per person per month to Rs 2250 per person per month.
- The paper also counters another Pew research paper that 75 million Indians were pushed into poverty, claiming that data was calculated in the absence of an ‘official’ Consumption Expenditure Survey (2017-18). Furthermore, it claims that ‘extreme poverty’ has been eradicated in India.
- The COVID-19 pandemic broke a streak of declining poverty globally and within India, according to a new World Bank report, with 2020 seeing the number of poor in India rising by between 3 crore and 5.6 crore, depending on the method of estimation. The increase in global poverty is the first since 1998, while the increase in India is the first since 2011.
FAO’s recommendation on Defining Poverty Line: Minimum energy requirements of calorie, protein and fat as recommended by FAO are based on scientific experiments and thus cannot be questioned. What can be questioned is whether these experiments are done in an environment suitable for the Indian situation.
Even though there have been several different estimates of poverty in India, all indicate reduction in poverty levels over time, from 45.3% in 1994 to 21.9% in 2012. However, the way to define what is a poverty line has varied many times and it plays a significant part in capturing the full story. As suggested, a scientific way to define a poverty line considering the social structure might be better suited in the Indian context. India can think of FAO’s poverty calculation in future to inculcate this.
In case you still have your doubts, contact us on 9811333901.
For UPSC Prelims Resources, Click here
For Daily Updates and Study Material:
Join our Telegram Channel – Edukemy for IAS
- 1. Learn through Videos – here
- 2. Be Exam Ready by Practicing Daily MCQs – here
- 3. Daily Newsletter – Get all your Current Affairs Covered – here
- 4. Mains Answer Writing Practice – here
