Tendulkar and Rangarajan Committees

In the Indian economy, the shift from calorie-based poverty estimation to a broader “standard of living” approach was spearheaded by two landmark committees: the Suresh Tendulkar Committee (2009) and the C. Rangarajan Committee (2014). These frameworks provided the statistical backbone for identifying beneficiaries under various welfare schemes.

Suresh Tendulkar Committee (2009)

The Tendulkar Committee was constituted to review the methodology for poverty estimation and address the limitations of the previous calorie-centric models.

Core Recommendations and Methodology

• Shift from Calorie Anchor: The committee moved away from a fixed calorie intake (2400/2100 kcal) as the sole criterion, arguing that calorie consumption did not strongly correlate with nutritional outcomes.
• Poverty Line Basket (PLB): It recommended a uniform PLB for both rural and urban India based on the consumption patterns of the urban poor.
• Inclusion of Health and Education: For the first time, private expenditure on health and education was explicitly incorporated into the poverty line, acknowledging that these are essential for human development.
• Price Adjustment: The committee used the Fisher Index to adjust for price differences between states and between rural and urban areas.
• Mixed Reference Period (MRP): It transitioned from the Uniform Reference Period (URP – 30 days) to MRP (recalling durables over 365 days and other items over 30 days) to obtain more accurate consumption data.

Poverty Thresholds and Findings

• Rural Poverty Line: Set at ₹446.68 per capita per month.
• Urban Poverty Line: Set at ₹578.80 per capita per month.
• National Poverty Ratio (2004-05): Re-estimated the poverty ratio at 37.2%, which was significantly higher than the earlier estimate of 27.5% made by the Lakdawala methodology.

C. Rangarajan Committee (2014)

Following public debate over the low poverty thresholds suggested by the Tendulkar methodology, the Rangarajan Committee was formed to provide a more robust estimation.

Key Features and Improvements

• Return to Nutritional Norms: It reintroduced a nutrition-based component but refined it to include calories, proteins, and fats. The norms were set at 2155 kcal (Rural) and 2090 kcal (Urban).
• Behavioral Approach: The committee identified a basket of essential non-food items (clothing, rent, conveyance, education) based on the observed consumption behavior of the median population.
• Modified Mixed Reference Period (MMRP): It adopted the MMRP, which uses a 7-day recall for highly perishable food items, a 365-day recall for durables, and a 30-day recall for all other items.
• Independent Rural/Urban Baskets: Unlike Tendulkar’s uniform basket, Rangarajan proposed separate consumption baskets for rural and urban areas to reflect ground realities.

Comparative Poverty Thresholds (2011-12)

The Rangarajan Committee proposed significantly higher daily expenditure limits compared to the Tendulkar Committee.

Critical Differences Between the Two Frameworks

While both committees sought to modernize poverty estimation, their methodologies diverged on several technical grounds.

• Reference Period: Tendulkar used MRP (30/365 days), whereas Rangarajan used MMRP (7/30/365 days).
• The “Anchor”: Tendulkar anchored the poverty line to a consumption basket of the urban poor; Rangarajan anchored it to a specific nutritional requirement plus essential non-food expenses.
• Estimation of Poor: The Rangarajan methodology resulted in a much larger number of people being classified as “poor” (approx. 363 million) compared to the Tendulkar methodology (approx. 270 million) for the same period (2011-12).

Impact on Policy and Current Status

• Beneficiary Identification: While these committees provided the statistical ratio, the actual identification of beneficiaries for the National Food Security Act (NFSA) and other schemes is done via the Socio-Economic Caste Census (SECC).
• Shift to Multidimensionality: Since 2021, NITI Aayog has shifted focus toward the National Multidimensional Poverty Index (NMPI), which evaluates 12 indicators across health, education, and standard of living, moving beyond the expenditure-based debates of the Tendulkar and Rangarajan eras.

Important Trivia for UPSC Prelims

• Reference Periods: Candidates must remember that MMRP (7-day recall for food) generally shows higher consumption expenditure than URP, thus leading to lower poverty ratios if the poverty line is fixed.
• Nodal Agency: All these committees submitted their reports to the Planning Commission, which has since been replaced by NITI Aayog.
• Data Source: Both committees relied on the Household Consumption Expenditure Survey (HCES) data provided by the National Sample Survey Office (NSSO).
• World Bank Comparison: The World Bank’s current poverty line of $2.15 (PPP) is much higher than the thresholds suggested by either the Tendulkar or Rangarajan committees.