Official Poverty Estimates
The last official estimate of poverty in India was released by the Planning Commission for the year 2011-2012. The poverty rate was calculated using the Tendulkar Committee’s methodology. Since then, no further official estimates have been published.
Recent Developments
In 2023, NITI Aayog published the report titled ‘National Multidimensional Poverty Index – A Progress Review 2023’. This report utilises data from the National Family Health Survey (NFHS-5) conducted between 2019 and 2021. The National Multidimensional Poverty Index (MPI) assesses deprivations across three dimensions – health, education, and standard of living, employing 12 indicators aligned with the Sustainable Development Goals (SDGs).
Highlights from the MPI Report
The MPI value decreased from 0.117 in 2015-16 to 0.066 in 2019-21. This indicates progress towards achieving SDG Target 1.2, which aims to halve the proportion of individuals living in poverty by 2030. Improvements in all 12 parameters are attributed to various flagship programmes initiated by the Government of India.
Types of Poverty
Absolute poverty refers to severe deprivation of basic human needs. Relative poverty is associated with income inequality, where individuals may meet basic needs but still feel poor compared to wealthier groups. Generational poverty describes a cycle of poverty that persists across generations. Situational poverty arises from specific life events, such as illness or natural disasters. Other forms include natural and artificial poverty, primary and secondary poverty, subjective poverty, and rural versus urban poverty.
Current Poverty Line Definition
The poverty line is defined as the threshold below which individuals are classified as poor. According to the Tendulkar Committee, the poverty line is set at ₹1,000 per month for rural areas and ₹1,500 for urban areas, based on 2011-12 prices.
Poverty Statistics
As of 2021, around 6.8% of India’s population lives below the poverty line, equating to approximately 83 million individuals. India accounts for approximately 20% of the global poor.
Poverty Trends
Poverty levels have decreased from 45% in 1993-94 to about 6.8% in 2021. However, the COVID-19 pandemic is estimated to have pushed an additional 75 million people into poverty.
Regional Disparities in Poverty
Certain states exhibit higher poverty rates, including Bihar (30.9%), Jharkhand (26.2%), and Uttar Pradesh (29.4%). Conversely, states with lower poverty rates include Kerala (0.7%), Goa (5.1%), and Punjab (7.5%).
Demographic Factors
Rural poverty is generally higher than urban poverty, with rural areas experiencing a poverty rate of approximately 7.9% compared to urban areas at around 5.5%. Scheduled Castes and Scheduled Tribes have higher poverty rates, approximately 20% and 25%, respectively.
Government Initiatives
Several poverty alleviation programmes exist, including the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), which guarantees 100 days of wage employment annually to rural households. The Pradhan Mantri Awas Yojana (PMAY) aims to provide affordable housing for the urban poor. The National Food Security Act (NFSA) ensures access to food at affordable prices.
Socioeconomic Factors
High unemployment rates contribute to poverty, with an unemployment rate of approximately 7.8% as of 2021. Low literacy rates in impoverished regions further exacerbate poverty, with rural literacy at about 68.9%.
Health and Nutrition Issues
Malnutrition affects approximately 38% of children under five, leading to stunted growth. Limited access to healthcare services in rural areas contributes to poverty.
Economic Growth and Poverty Dynamics
India’s GDP growth rate was around 8.4% in 2021. However, the benefits of this growth have not been evenly distributed, resulting in income inequality, as indicated by a Gini coefficient of approximately 35.7.
Future Projections
The Government of India aims to reduce poverty to below 3% by 2030, aligning with the Sustainable Development Goals (SDGs).
International Comparisons
India’s poverty headcount ratio is notably higher than that of other BRICS nations, such as Brazil and South Africa.
Challenges Ahead
Sustainability of poverty alleviation measures remains a critical concern. Additionally, the impact of climate change poses risk to the livelihoods of the poor, exacerbating vulnerabilities to environmental shocks and disasters.
Questions for UPSC:
- Critically analyse the impact of flagship programmes like Pradhan Mantri Awas Yojana and Swachh Bharat Mission on reducing multidimensional poverty in India.
- Estimate the role of education and employment in influencing poverty levels in India, particularly in rural areas, and discuss potential policy interventions.
- Point out the regional disparities in poverty rates across state of Indias and analyse the historical and socio-economic factors contributing to these differences.
- With suitable examples, evaluate the sustainability of current government poverty alleviation initiatives in the context of climate change and economic inequality.
Answer Hints:
1. Critically analyse the impact of flagship programmes like Pradhan Mantri Awas Yojana and Swachh Bharat Mission on reducing multidimensional poverty in India.
- Pradhan Mantri Awas Yojana (PMAY) aims to provide affordable housing, addressing shelter needs and improving living conditions.
- Swachh Bharat Mission focuses on sanitation and hygiene, leading to better health outcomes and reduced healthcare costs.
- Both programmes contribute to economic empowerment through job creation in construction and sanitation sectors.
- Improved living conditions and sanitation have a direct impact on education and productivity, further reducing poverty.
- Challenges include implementation gaps and ensuring that benefits reach the most vulnerable populations effectively.
2. Estimate the role of education and employment in influencing poverty levels in India, particularly in rural areas, and discuss potential policy interventions.
- Education enhances skill development, increasing employability and income potential, crucial in rural areas with limited job opportunities.
- Employment programs like MNREGA provide financial stability, reducing vulnerability to poverty among rural households.
- Access to quality education remains uneven, with rural areas facing high dropout rates and inadequate infrastructure.
- Policy interventions could include improving rural education infrastructure and vocational training programs tailored to local job markets.
- Strengthening self-employment initiatives and microfinance can also empower rural populations economically.
3. Point out the regional disparities in poverty rates across states of India and analyse the historical and socio-economic factors contributing to these differences.
- Poverty rates vary , with states like Bihar and Uttar Pradesh having higher rates compared to Kerala and Punjab.
- Historical factors include colonial exploitation, which left some regions more developed than others, impacting current economic conditions.
- Socio-economic factors include access to education, healthcare, infrastructure, and employment opportunities, which vary widely across states.
- Regional disparities are also influenced by governance, policy implementation, and local resource availability.
- Addressing these disparities requires targeted policies that consider the unique historical and socio-economic contexts of each state.
4. With suitable examples, evaluate the sustainability of current government poverty alleviation initiatives in the context of climate change and economic inequality.
- Current initiatives like PMAY and skill development programs face challenges from climate change, impacting agriculture and livelihoods.
- For example, increased flooding and droughts affect rural income stability, undermining poverty alleviation efforts.
- Economic inequality exacerbates the impact of climate change, as marginalized communities are less resilient to environmental shocks.
- Integrating climate resilience into poverty alleviation programs is essential for long-term sustainability.
- Examples of successful integration include promoting sustainable agricultural practices and renewable energy projects in rural areas.
