Poverty Line in India: Time to take the Measurement Seriously

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The progress of a nation is measured by the number of welfare measures it provides to its citizens. The notion of state intervention in the well-being of its residents is an accepted norm across the world. This commitment towards the betterment of the people’s lives is most pronounced in the democratic systems of government. India, being the largest democracy in the world has the obligation to take concrete steps for the improvement of the citizens’ standard of living. The country has undisputedly done tremendous progress in the fields of science, technology, medicine, defense and industrial production since the time she got independence from the clutches of the tyrant British. But one aspect where the growth seems to be elusive has been the glaring proportion of its population living in abjure poverty. India is today an unpatrolled example of dichotomy where on one hand there are world-class airports, nuclear plants, defense installations and production houses; on the other, there are crores condemned to live a life of hunger and disease in ghettos full of filth and vermins. It is indeed ironic that the famous line of Charles Dickens’s novel The Tale of Two Cities, “It was the best of times, it was the worst of times” stands true for the people of the nation. For the rich and powerful, it is the time where they could mend ‘rules and the law’ with bribery and amass more wealth; however, the poor and destitute are condemned to the lives of perpetual misery and injustice.

The bane of poverty is the biggest problem that stares the nation in the face and is the greatest hurdle in the path of development. The topic of ‘poverty alleviation’ has been hotly debated in the political arenas too where successive governments have usurped power on the lofty promises of solving the predicament. The slogan of ‘Garibi Hatao’ is legendary, so is its cruel betrayal by all the governments since independence. Various welfare schemes and employment programs have been initiated across the decades, but they have failed to realize the desired results. In spite of the dismal success of the poverty alleviation programmes, the methodology adopted to measure the poverty level is of great importance for planning future measures and reducing the number of poor in the nation. The article studies the various committees formed for the estimation of poverty and suggests the remedial measures in the present methodology of the identification of poor in India.

Methodology of Measuring Poverty in India

The need to measure the poverty level in the country is paramount to devise targeted strategies for the reduction of rising poverty. The detailed study of the distribution is required to identify the vulnerable groups and provide them with extra benefits for amelioration. The first measurement of the poverty levels in India dates back to the nineteenth century when the nationalist economist Dadabhai Naoroji measured the income level required for survival on the basis of the 1867-68 prices. He calculated the level on the basis of the amount of money needed ‘for the bare wants of a human being, to keep him in ordinary good health and decency’. The National Planning Committee (1938) formed at the Haripur Session of the Indian National Congress also calculated the money needed for survival in British India. The Bombay Plan (1944) put forward by the leading industrialists of the nation for the economic development tried to assess the poverty levels. The staring feature of this exercise was that it took both the income as well as calorie intake criteria into account for the estimation of the poverty. Other than the efforts of the nationalists, the British Government did nothing to access the quantum of the poverty in India, lest to bring out the barbaric impact of its colonial rule on the indigenous people of India.

After attaining Independence, the government took many steps for the measurement of poverty level across the nation. For the identification, the government has followed the tool called ‘poverty line’ which depicts the percentage of population living in poverty from the total population. A working group of the economic experts was made in 1962 which was headed by Prof. D. R. Gadgil was formed for the identification of the poverty level. The remarkable contribution to the study of the poverty level in India was done by two independent scholars namely, V M Dandekar and Nilkanth Rath. Their 1971 study linked the ‘calorie intake levels’ with the poverty estimation. The result was the formation of a task force by the government in the year 1979 entrusted with the determination of the ‘Minimum Needs and Effective Consumption Demand’. It was chaired by Dr. Y K Alagh and it brought urban-rural and age-sex demarcations into the poverty level discourse. The major step for the identification of the poor came in the year 1993 when the Lakdawala Committee was appointed for the measurement of the poverty level. The report of the committee was criticised as being detached from ground realities of the nation and the demand for another estimation was raised.

The present methodology adopted by the government for the measurement is based on the criteria of the Tendulkar Committee. In December 2005 the Planning Commission (NITI Ayog’s predecessor) constituted an expert group led by Prof. Suresh Tendulkar for the computation of the poverty lines. The group submitted its report in 2009 on the basis of the 2004-05 prices which were accepted by the Union Government. The next milestone was the 2009-10 Household Consumer Expenditure Survey by NSSO to update the prices levels with region wise variations. C. Rangarajan Committee was instituted in the year 2012 for the poverty measurement. The distinguishing feature of the report of the group released in 2014 was that it recommended that the poverty line must incorporate a certain standard of nutrition, clothing, house rent, education and other non-food expenditure. It was a marked change for the prevailing position where the emphasis was only on the food expenditure computation.

‘Poverty Level’ in India

The official tool for the estimation of poverty in India being followed by the Union Government is the Tendulkar Committee (2009) report formula based on the 68th round of NSSO (2011-12). The official poverty line works out to be approximately ₹ 816 per person per month in rural areas and ₹ 1,000 per person per month in urban areas at the 2011-12 price levels. The total percentage of population living below poverty line is 25.7% in rural areas and 13.7% in the urban areas. It compounds to 21.9% in the population of 130 crores. It totals to about 28.47 crore people living in poverty, which is more than the entire populations of most of the nations in the world. There is also the glitch that the Union Government has not till now adopted the recommendations of C. Rangarajan Committee for the new population levels which are most comprehensive and realistic as they take into account the non-food expenditure along with the prescribed amount of calories, fats and proteins as per the ICMR standards. This methodology would total to the poverty line in rural areas to be ₹ 972 and ₹1,407 for the urban areas. But the problem is that it will increase the total proportion of the population living in poverty greatly. The new nation-wide percentage of poverty would amount to 29.5% (from the current 21.9%). Similarly, in the rural areas the percentage will be 30.9% while in the urban areas, it would be 26.4%.

The non-adoption of new and reformed guidelines of the C. Rangarajan Committee by the Union Government is nothing but a cruel jugglery of figures to mask its monumental failure in poverty reduction. Another aspect of the problem is that no government would like to invite the ire of the electorate by adopting new guidelines because the blame for appalling poverty levels must be shared by successive governments spanning seven decades of Independent India. It must be pointed out that though the methodology of the Rangarajan Committee is renewed, it is still a far cry from the globally accepted norm of $1/day. However, acceptance of the Rangarajan recommendations would be a great step in the mission of poverty reduction.

Need of ‘Political Will’

The governments have, over the years, introduced various schemes for the poverty reduction. The major ones being the National Food for Work Program, Swaranjayanti Gram Swarozgar Yojana, Indira Awas Yojana, Mid-day Meal Scheme, Public Distribution System (PDS), UJWALA Yojana etc. for the welfare of the poor people. The seminal contribution was made by the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) in providing assured 100-day employment in the rural areas. The initiatives of the ruling dispensation like Direct Benefit Transfer (DBT) scheme, SUBHAGYA Yojana, Stand-up India, Bharat Net and Jan Dhan Yojana are positive steps for the empowerment of the rural areas. The main hurdles in the path of the economic emancipation are the corruption and nepotism in the official working that results in most of the funds meant for the development of the poor going to the corrupt officials and ministers. The vast amounts of Non-Performing Assets (NPAs) of the Indian banking sector of about ₹ 7 lakh crores are enough to feed 84.54 lakh poor people for their entire lives (taking ₹1000/month for 69 years). The political will to prevent misuse of the public money is totally absent. The instances of about 44 deaths of the poor people for the chilling weather in Delhi in only 6 days (1st to 6th January 2018) and spine-shivering news of the death of a schoolgirl in Chhattisgarh for being denied government rations depicts the extreme apathy of the ruling class to the woes of poor. The government must also inspire austerity measures as any nation with 28 crores poor people must follow some economic propriety.

Remedial Measures for Improvement

The need of the hour is to sincerely pursue the policies of the government for the benefits of the poor. The bane of corruption must be reduced and the allotted money for the poor must reach its desired beneficiaries. The government must also stop its Frankenstein-like insistence on the Aadhaar card for the government benefits. The life of an Indian is too pious to be denied over non-production of the Aadhaar card. The judiciary must also improve its track record in reducing corruption. The wealthy corrupt officials and ministers go scot-free due to the elite army of lawyers and dilatory tactics. The government must also base its benefits schemes solely on the economic basis. The ‘caste’ factor must be totally separated from the eligibility conditions when it comes to Below Poverty Line (BPL) in India. The economic incapacity and hunger hit people of all castes and religions equally hard. The government must also pay adequate attention to the implementation of the schemes, rather than solely focussing on outcomes and budgetary allocations. Stringent auditing of every rupee sanctioned for the poor along with timely supervision of the welfare schemes must be implemented. The use of economic tools like the Poverty Gap Index (PGI) which studies the inequalities in the income level of the population must also be studied while framing of the policies by the Union Government.

The youth of the nation has a great role in building a better and more resilient nation. They must pledge to end the problems of corruption and nepotism. The people must also choose their political representatives wisely. The leaders who have been facing graft charges and those convicted in corruption cases must be socially boycotted by the public. The problem of poverty is multi-dimensional in nature and all the aspects of the economic incapacity of the people must be perused in great detail. If the government is able to improve its welfare benefit delivery effectiveness and curb its wasteful spending in oath ceremonies, rallies and political publicity; only then the dream of the happy and content population could be realized. We must remember that even on the glorious day of 15th August 1947, Jawaharlal Nehru declared that we are redeeming our pledge ‘not completely, but in partial measure’. The people of India have been waiting for more than 70 years for the completion of that pledge, and it is high time we take concrete steps in heralding a golden future for the nation.


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