Poverty in India PDF

POVERTY IN INDIA  Poverty  “The word ‘poverty’ is originated from the Latin word ‘pauper’ meaning poor, which has its roots in the words ‘pau’ and ‘pario’ that is ‘giving birth to nothing’ referring to unproductive livestock and farmland”  Thus, from its origina...

POVERTY IN INDIA  Poverty  “The word ‘poverty’ is originated from the Latin word ‘pauper’ meaning poor, which has its roots in the words ‘pau’ and ‘pario’ that is ‘giving birth to nothing’ referring to unproductive livestock and farmland”  Thus, from its originality, the term has not been a blessing one rather it is discarded situation that people would like to abandon.  Encyclopedia Encarta defines poverty as “the condition of having insufficient resources or income”. According to the United Nations Human Development Report, (1998), poverty is defined as “a complex phenomenon that generally refers to inadequacy of resources and deprivation of choices that would enable people to enjoy decent living conditions”.  The United Nation (UN) has defined extreme poverty as a “condition characterized by severe deprivation of basic human needs, including food, safe drinking water, sanitation facilities, health, shelter, education and information. It depends not only on income but also on access to services.” The World Bank sets the international poverty line at periodic intervals as the cost of living for basic food, clothing, and shelter around the world changes. In the 2008 update, the poverty line was set at $1.25 per day. In 2015, the threshold was updated to $1.90 per pay, which is where it currently stands. According to World Bank, a person whose per capita income is less than 1.9 dollars per day (2011 purchasing power parity, U.S.$) is called absolute poor. In simple terms, Poverty is the state of one who lacks a usual or socially acceptable amount of money or material possessions. Poverty is said to exist when people lack the means to satisfy their basic needs.  Absolute Poverty and Relative Poverty Absolute poverty refers to the condition where a person does not have the minimum amount of resources needed to meet the minimum standard of living. Absolute poverty involves the scarcity of basic need such as food, clean water, health, shelter, education and information. Those who belong to absolute poverty tend to struggle to live and experience a lot of child deaths from preventable diseases. Absolute Poverty is usually common in developing countries. Relative poverty on the other hand is concerned with how well-off an individual is with respect to others in the same society. Hence it is a measure of income inequality. Usually, relative poverty is measured as the percentage of the population with income less than some fixed proportion of median income. It is a widely used measure to ascertain poverty rates in wealthy developed nations.  Types of Poor Chronic poor: People who are leading constant lives of poverty and who are normally poor but may have a small amount of money with them (for example, casual workers) are classified collectively as the chronic poor. Churning poor: The churning poor are the people who go in and out of poverty (for example, small farmers and seasonal workers). Transient poor: The poor who are well off most of the time but may be subject to bad luck or difficult times at times. They are known as the transient poor  Method of Poverty Estimation Estimation Based on Calorie Intake: Under this method, the minimum requirement of calories for a person in rural and urban are determined independently. The per capita daily requirement of 2400 calories and 2100 calories for an adult in Rural and Urban area respectively. Estimation Based on Income: This is a common methodology of estimating poverty where a particular level of income is fixed as poverty line. Estimation Based on Consumption Expenditures: Under this methodology, various weights are assigned to a basket of goods and services to satisfy basic human needs. This minimum expenditure is taken as poverty line. Estimation Based on Multidimensional Aspects: This measures of poverty captures deprivations in various aspects of life such as Education, Health and Standard of Living.  Overview of Poverty Estimation In India Pre-Independence Estimation Dadabhai Naoroji Estimation of Poverty: The first pre- independence estimation of poverty in India can be traced back to 19th century when Dadabhai Naoroji’s efforts and careful study set subsistence costs based poverty line that varied from Rs.16 to Rs.35 per capita per year in various regions of India at 1867-68 prices. National Planning Committee (1938): National Planning Committee was set up in 1938 under the chairmanship of Jawaharlal Nehru and Professor K. T. Shah as secretary. The Committee regarded the irreducible minimum income between Rs. 15 to Rs. 25 per capita per month at pre-war prices. However, this was also not tagged something as a poverty line of the country. Post- Independence Estimation First Planning Commission Working Group (1962):The concept of the poverty line was first introduced by a working group of the Planning Commission in 1962. The working group formulated the separate poverty lines of Rs 20 per month for rural and Rs 25 per month for urban areas respectively at 1960- 61 prices. These estimates excluded the expenditure on health and education, which both were expected to be provided by the state. Y.K Alagh Committee (1979): In 1979, the Planning Commission constituted a task force for the purpose of poverty estimation under the chairmanship of Y.K Alagh. The committee constructed a poverty line for rural and urban areas on the basis of nutritional requirements. The committee recommended per capita daily requirement of 2400 and 2100 calories for an adult in Rural and Urban area respectively.  Lakdawala Committee (1993): In 1993, Planning Commisison constituted expert group to review methodology for poverty estimation, chaired by D.T Lakdawala. The committee decided to retain the poverty line defined by task force (1979) but disaggregated the national level into rural and urban poverty lines as defined by task force into state-specific poverty lines The Tendulkar committee (2005): The committee set a benchmark daily per capita expenditure of Rs. 27 and Rs. 33 in rural and urban areas respectively and estimated about 22 (i.e 21.9) percent of the population below poverty line based on this method in 2011-12. The Rangarajan committee (2012): The committee set a daily per capita expenditure of Rs 32 and Rs 47 in rural and urban areas respectively as the poverty line, and worked out Below Poverty Line at close to 29.5 percent in 2011-12  Current State Of Poverty In India Poverty estimation in India is now carried out by NITI Aayog’s. Previously, Planning Commission was responsible for estimating poverty officially. Poverty line estimation in India is based on the consumption expenditure and not on the income levels. Year Rangarajan Lakdawala Committee Tendulkar Committee Committee Rural Urban Total Rural Urban Total Rural Urban Total 1993-94 37.3 32.4 36.0 50.1 31.8 45.3 - - - 2004-05 28.3 25.7 27.5 41.8 25.7 37.2 - - - 2009-10 - - - 33.8 20.9 29.8 39.6 35.1 38.2 2011-12 - - - 25.7 13.7 21.9 30.9 26.4 29.5  Global Multidimensional Poverty Index (MPI) Multidimensional Poverty Index (MPI) was developed by Oxford OPHI and UNDP in 2010. The MPI measures overlapping deprivations at the household level across three dimensions (Education, Health, Standard of Living) made up of ten indicators. The MPI measures not only incidence of poverty (headcount ratio) but also intensity of poverty (severity of poverty)  Relati Dimensi Indicato ve Deprive if.. on r Weigh t Years of No household member has completed at least 1/6 Schooling one year of schooling (>=1). Educatio School n No child is attending school up to the age at Attendan 1/6 which they should finish class 6. ce Child 2 or more children have died in the household 1/6 Mortality  Electricity The household has no electricity (no change) 1/18 Sanitation There is no facility (open defecation) 1/18 The household does not have access to safe Drinking drinking water, or safe water is more than a 1/18 Water 45 minute walk (round trip). Living The household has a dirt, sand, or dung floor Standar Flooring 1/18 (no change). d Cooking The household cooks with dung or wood 1/18 Fuel (coal/lignite/charcoal are now non deprived). Assets The household has no assets (radio, mobile 1/18 ownership phone, etc.) and no car.  MPI and SDGs The measure of acute multidimensional poverty also keeps in check the performance of countries in the Sustainable Development Goals (SDGs) Targets: The ‘Health’ dimension covers the following SDGs areas: SDG 2 – Zero Hunger SDG 3 – Health and Well-Being The ‘Education’ dimension covers the following SDGs area: SDG 4 – Quality Education The ‘Living Standards’ dimension covers the following SDGs areas: SDG 1 – No Poverty SDG 6 – Clean Water and Sanitation SDG 7 – Affordable and Clean Energy SDG 11 – Sustainable Cities and Communities  Scenario Of Multidimensional Poverty In India The Global Multidimensional Poverty Index has shown the same downward trend as depicted by Planning Commission’s official data on poverty. The Global MPI 2021 was released in September 2021. According to Global MPI 2021, India’s rank is 66 out of 109 countries. Data Source MPI MPI H A Publication Survey Year Year 2016 DHS 2005-2006 0.283 53.7 52.7 2017 IHDS 2011-2012 0.191 41.3 46.3 2018 DHS 2015-2016 0.121 27.5 43.9 2019 DHS 2015-2016 0.123 27.91 43.95 2021 DHS 2015-2016 0.123 27.91 43.95  The National MPI Recently, Niti Aayog has published the first-ever National Multidimensional Poverty Index (MPI) of India. The National MPI is aimed at deconstructing the Global MPI and creating a globally aligned and yet customized. India MPI for drawing up comprehensive Reform Action Plans with the larger goal of improving India’s position in the Global MPI rankings. It has three equally weighted dimensions – health, education, and standard of living. These three dimensions are represented by 12 indicators such as nutrition, school attendance, years of schooling, drinking water, sanitation, housing, bank accounts among others. This baseline report of the national MPI measure is based on the reference period of 2015-16 of the National Family Health Survey (NFHS-4).  Key Findings As per NITI Aayog’s report, in year 2015-16, one in every four people in India was multidimensionally poor. It accounts that, 25.01 per cent of the population was multidimensionally poor. Bihar has the highest proportion of people of the state’s population followed by Jharkhand and Uttar Pradesh who are multidimensionally poor. Kerala registered the lowest population poverty levels, followed by Puducherry, Lakshadweep, Goa and Sikkim. Among Uts, Dadra and Nagar Haveli (27.36 per cent), Jammu & Kashmir, and Ladakh (12.58), Daman & Diu (6.82 per cent) and Chandigarh (5.97 per cent), have emerged as the poorest UTs in India. The proportion of poor in Puducherry at 1.72 percent is the lowest among the Union Territories, followed by Lakshadweep at 1.82 per cent, Andaman & Nicobar Islands at 4.30 per cent and Delhi at 4.79 per cent.  Significance of National MPI Important Public Policy Tool: The development of the National MPI of India will be instituting a public policy tool which monitors multidimensional poverty, informs evidence-based and focused interventions, thereby ensuring that no one is left behind. Adjudges Success of Multi-sectoral Interventions: It provides important insights into the degree of success of multi-sectoral interventions to address various aspects of poverty. Includes Multiple Deprivations: Importantly, as a measure of multidimensional poverty, it captures multiple and simultaneous deprivation faced by households. Rigorous Analysis Through All Levels: This report presents an in-depth analysis of the headcount ratio and intensity of multidimensional poverty at the national, State/UT, and district levels.