From UPSC perspective, the following things are important :
Prelims level : Poverty line
Mains level : Paper 3- Counting the number of the poor
Counting the number of the poor
- If the state of the Indian economy is to be repaired, we need to meticulously count the number of the poor and to prioritise them.
- The World Bank $2-a-day poverty line might be inadequate but it would be a start and higher than the last line proposed by the C. Rangarajan committee.
- A survey in 2013 had said India stood at 99 among 131 countries, and with a median income of $616 per annum, it was the lowest among BRICS and fell in the lower-middle-income country bracket.
- Since 2013 three important data points have made it clear that the state of India’s poor needs to be acknowledged if India is to be lifted.
- The first being, the fall in the monthly per capita consumption expenditure of 2017-18 for the first time since 1972-73.
- Second is the fall of India in the Global Hunger Index to ‘serious hunger’ category.
- Third, health census data or the recently concluded National Family Health Survey or NFHS-5, which had worrying markers of increased malnutrition, infant mortality and maternal health.
- A fourth statistic, Bangladesh bettering India’s average income statistics, must also be a reason for Indians to introspect.
Increase in number of poor in India
- In 2019, the global Multidimensional Poverty Index reported that India lifted 271 million citizens out of poverty between 2006 and 2016.
- Since then, the International Monetary Fund, Hunger Watch, SWAN and several other surveys show a decided slide.
- In March, the Pew Research Center with the World Bank data estimated that ‘the number of poor in India, on the basis of an income of $2 per day or less in purchasing power parity, has more than doubled to 134 million from 60 million in just a year due to the pandemic-induced recession’.
- In 2020, India contributed 57.3% of the growth of the global poor.
- This has thrown a spanner in the so far uninterrupted battle against poverty since the 1970s.
- Urgent solutions are needed within, and the starting point of that would be only when we know how many are poor.
Debate on the poverty line
- In 2011, the Suresh Tendulkar Committee report at a ‘line’ of ₹816 per capita per month for rural India and ₹1,000 per capita per month for urban India, calculated the poor at 25.7% of the population.
- The anger over the 2011 conclusions, led to the setting up of the C. Rangarajan Committee.
- In 2014, C. Rangarajan Committee estimated that the number of poor were 29.6%, based on persons spending below ₹47 a day in cities and ₹32 in villages.
- The National Commission for Enterprises in the Unorganised Sector in 2004, had concluded that 836 million Indians still remained marginalised.
- The Commission’s conclusion was ignored — that 77% of India was marginalised — emphasising that it was a problem of a much bigger magnitude, than the figure of 25.7% conveyed.
Why counting the poor matters?
1) Helps in forming public opinion
- Knowing the numbers and making them public makes it possible to get public opinion to support massive and urgent cash transfers.
- The world outside India has moved onto propose high fiscal support, as economic rationale and not charity.
- In India too, a dramatic reorientation would get support only once numbers are honestly laid out.
2) It helps in evaluating success of policies
- Recording the data helps to evaluate all policies on the basis of whether they meet the needs of the majority.
- Is a policy such as bank write-offs of loans amounting to ₹1.53-lakh crore last year, which helped corporates overwhelmingly, beneficial to the vast majority?
- This would be possible to transparently evaluate only when the numbers of the poor are known and established.
3) Helps in addressing the concerns of real majority
- If government data were to honestly account for the exact numbers of the poor, it may be more realistic to expect the public debate to be conducted on the concerns of the real majority.
- Such data would also help in creating a climate that demands accountability from public representatives.
4) To gauge the rising inequality
- India has clocked a massive rise in the market capitalisation and the fortunes of the richest Indian corporates, even as millions of Indians have experienced a massive tumble into poverty.
- To say that the stock market and the Indian economy are ‘not related’ is ingenuous.
- Indians must have the right to question whether there is a connection and if the massive rise in riches is not coincidental, but at the back of the misery of millions of the poor.
- If billionaire lists are evaluated in detail and reported upon, the country cannot shy away from counting its poor.
The massive slide into poverty in India that is clear in domestic and international surveys and anecdotal evidence must meet with an institutional response.