Living standard, not income, key to fixing poverty line: Govt paper

Economy


(This story originally appeared in on Oct 19, 2020)

NEW DELHI: The future definition of poverty line cannot be the subsistence level income required by an individual but will have to factor in living standards that encompass facilities like housing, education and sanitation among others, a working paper on poverty released by Union rural development ministry notes.

Besides, the paper says that the coronavirus pandemic has “underscored the criticality of certain essentials — access to quality healthcare, education and awareness, water and sanitation facilities, adequate nutrition and the need for living spaces where social distancing can be practiced.”

Interestingly, it says that World Bank has classified India as a lower middle-income country with poverty line at the consumption level of Rs 75 per person per day— a figure higher than India’s present marker. “Over time, India will need to adjust to the new reality of the transition to a lower middle-income country in which poverty does not mean living at the edge of hunger but, rather, lack of income to take advantage of the opportunities thrown up by a growing economy,” the paper notes.

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Written by Seema Gaur and N Srinivasa Rao, principal economic advisor and economic advisor to the department of RD, respectively, the academic paper traces the history of poverty measurement in the country over decades and the controversies that have dogged the process because of its tricky nature. A row had erupted over the Tendulkar poverty line which was said to be pegged too low.

However, the paper concludes that a “poverty line” is essential for the policy makers to have an objective number around which to work as also to measure the progress in combating deprivation. It says that notching an average annual GDP growth rate of 8% is critical to the strategy of attacking poverty by creating jobs. The RD ministry plays a key role in measuring and combatting poverty, being the authority on socio-economic caste census, which is the present barometer for identifying deprived households as also the executor of major poverty alleviation programmes.

While underlining that global reports have asserted that India was moving the fastest in fighting poverty, the paper says “Progress in poverty reduction and improvement in the socioeconomic indicators in India has been marked by substantial inequalities. Poverty is concentrated both spatially and among social and economic groups.”



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