Counting the Poor, Numbers suggest need for a welfare

Counting the Poor, Numbers suggest need for a welfare


  • There is a need to introspect on who is exactly is poor in India. There was a time when calorie intake was the yardstick. But, converting calorie required a day into monetary value was always a challenge.
  • People also cannot live with just calories. They need housing, clothing, education and so on.
  • The world bank uses the concept of income per day, which is now taken at $1.9 for per person per day. It translates to approximately Rs160 a day in India, for a family of 4, Rs640 a day. It translates to Rs 19,200 monthly or Rs 2.3 lakh for a year.
  • Such approach adopts a universal yardstick which is not current. For Ex- $1.9 for per person per day may be too low for a developed country. There is also the risk for extrapolation because it is not possible to get these numbers for entire population.
  • Income tax data, while useful indicator captures on a small segment.
  • Pradhan Mantri Garib Kalyan Yojana covered 800 million people. It implies nearly 60% of the population required support from the government.
  • The PM KISAN scheme which involves outlay of Rs 6000 per beneficiary per year has been availed by 110 million farmers. However, it leaves vulnerable non farming class, especially poor in urban areas.
  • Putting all these numbers together, the proportion of vulnerable people in the economy would range between 30% and 60%. In such a situation it is but natural that the government has to assume the role of a welfare state.

What is Poverty?

Poverty is a state or condition in which a person or community lacks the financial resources and essentials for a minimum standard of living.

Types of Poverty: Mainly two

  • Absolute Poverty : A condition where household income is below a necessary level to maintain basic living standards food, shelter, housing etc
  • Relative Poverty : It is defined from the social perspective that is living standard compared to the economic standards of population living in surroundings.

How Poverty is measured?

Poverty line estimation in India is based on the consumption expenditure surveys and not on the income levels.

VM Dandekar and N Rath Committee (1971) It made the first systematic assessment of poverty in India, based on National Sample Survey (NSS) data. It said that poverty line must be derived from the expenditure that was adequate to provide 2250 calories per day in both rural and urban areas.

Alagh Committee (1979) It constructed a poverty line for rural and urban areas on the basis of nutritional requirements and related consumption expenditure. Poverty estimates for subsequent years were to be calculated by adjusting the price level for inflation.

Lakdawala Committee (1993) It continued with the Consumption expenditure calculated based on calorie consumption as earlier. It also provided for State specific poverty lines and these should be updated using the CPI-IW in urban areas and CPI-AL in rural areas.

Tendulkar Committee (2005) It adopted a shift from calorie based estimation to include items like cereal, pulses, milk, vegetables, spices etc. It computed separate poverty lines for Rural and Urban areas. It also included consumption on health and education while estimating poverty line.

According to Tendulkar Committee, Poor as a percentage of population stand at 21.9% in 2011-12. Official Poverty figures (Government Figures) are based on Tendulkar committee.

Rangarajan Committee (2012)- It adopted average requirements of calories, proteins and fats based on Indian Council of Medical Research (ICMR) norms. It provided separate poverty lines for Rural and Urban areas. It incorporated Clothing, footwear, education, institutional medical treatment etc.

According to Rangarajan committee, Poor as a percentage of population stand at 29.5% in 2011-12.

What is Multidimensional Poverty Index by NITI Aayog?

(Credits- PIB)

The NMPI is calculated using 12 indicators — nutrition, child and adolescent mortality, antenatal care, years of schooling, school attendance, cooking fuel, sanitation, drinking water, electricity, housing, assets and bank account. They have been grouped under three dimensions namely, health, education and standard of living. India’s national MPI (multidimensional poverty index) identifies 25.01 per cent of the population as multidimensionally poor.

What are the schemes for Poverty alleviation?

  • Integrated Rural Development Programme (IRDP)
  • Jawahar Rozgar Yojana/Jawahar Gram Samridhi Yojana
  • Rural Housing – Indira Awaas Yojana
  • Food for Work Programme
  • National Old Age Pension Scheme (NOAPS)
  • Annapurna Scheme
  • Sampoorna Gramin Rozgar Yojana (SGRY)
  • Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) 2005
  • National Rural Livelihood Mission
  • National Urban Livelihood Mission
  • Pradhan Mantri Kaushal Vikas Yojana
  • Pradhan Mantri Jan Dhan Yojana

Way Forward Reducing Inclusion and Exclusion errors, skilling of population, support to manufacturing companies along with reducing red tapism will go a long way in reducing poverty in the country.

NEWS- Counting the Poor, Numbers suggest need for a welfare state.

Syllabus- Mains; GS-3; Poverty