Events & Issues

New Delhi, 24 October 2011

Poverty Line

WHAT ABOUT THOSE ABOVE IT?

Dr. S. Saraswathi

(Former, Director, ICSSR, New Delhi)

This exercise of the Government, periodically undertaken, has now become one of the rare cases of it responding to criticism and suggestions and coming out with explanations and reparations in drawing this line. 

Poverty line, like the Equator, is an invisible and imaginary line, but dividing not the territory but people. It can be used for varied purposes like identification of people for granting governmental food security, coverage under various welfare programmes, preparation of human development index (domestic and international), and so on.

Therefore, there is scope as well as use for more than one line drawn on different criteria.  For, poverty has various dimensions and affects people in different degrees. It has multiple properties.

Ever since Dandekar and Rath attempted a measurement of poverty in 1973 on the basis of calories intake, the basis remains the same and its translation in monetary terms changes according to price index. Revised estimates of population below poverty line have been made and new norms have also been examined.

The current revision sticks to the existing level of minimum consumption of 2100 calories per capita per day in urban and 2400 calories in rural areas as the line dividing the poor and the non-poor.  In monetary terms, it amounts to Rs. 32 in urban and Rs. 28 in rural areas per day per head.  It means a monthly expenditure of Rs.4824 in urban and Rs.3905 in rural areas as per June 2011 prices for a family of five members.

This falls far below the international poverty line drawn by the World Bank in 2008 at $ 1.25 per capita per day on the basis of household income.  It was estimated that one-third of people below this line were in India, and 41.6% of the total population of India was poor.

The monetary limit now fixed by the Planning Commission is supposed to cover not only food, but many other items such as clothing, shelter, cooking fuel, lighting, transport, education, and medical costs. In view of the ever-rising cost of commodities, it is obvious  that the line does not demarcate the poor from the non-poor, but the desperately poor and the destitute from all others including those not so poor. Hence, those technically above the line include sizeable number of poor people who cannot afford a decent living standard.

The artificially low poverty line may help the nation to show drastic reduction in poverty ratio, and help reach the MDG on paper, but cannot help lessen real poverty or the number of poor. The percentage calculation, first of all, overlooks the size by number which keeps increasing.  Secondly, poverty estimates ignore myriad factors other than calories intake and income required for that which make one poor. The official claim of reduction in poverty ratio from 36% in 2004-05 to 32% in 2009-10 is made on this controversial poverty estimates 

In fact, poverty estimates have always been a matter of debate and differences over the formula and the calculation.  It is hard to believe that past estimates range between 16% and 77% of the population. The Planning Commission and expert committees do not see eye to eye. In the 1990s, for instance, Lakdawala Committee, taking minimum standard of living as the index, put the poverty ratio as 36% against the Planning Commission’s estimate of 16.6%. More recently, Tendulkar’s poverty estimate of 32% replaced the official figure of 28%.

In international comparisons, poverty threshold is understood as the minimum level of income deemed necessary to achieve an adequate standard of living in a given country. This is bound to be higher in developed countries than in developing countries. Food alone is not adequate for decent living as a human being.  

There are three basic poverty dimensions in human poverty index, namely, knowledge, longevity, and proper standard of living.  These are measured by various indicators such as life expectation, education, mortality rate, health and nutrition.  Availability of and access to basic necessities of life like safe drinking water, medical care, toilet facilities, schools, etc., are some of the minimum requirements denied not only to those below the officially drawn  “poverty line”, but also to many  above the line.  Poverty must be identified in all forms of deprivation.

Amartya Sen has stated that “real poverty” is in terms of “capability deprivation” and may be more intense than income deficiency.  From this angle, distribution of doles and freebies may satisfy the recipients’ desire for acquisitions, but does not even remotely contribute to capability development and thereby to poverty removal.

There are different poverty concepts. It may be limited to subsistence level which is reflected in the Planning Commission’s poverty line. It may be seen as inability to meet essential needs for decent living which is faced by bulk of those above the poverty line. This is taken into account by many populist State Governments. It can also be viewed as relative deprivation which is sought to be removed by various policies like Reservation.

Schemes like the NREGA are intended to remove absolute poverty.   Other welfare schemes are needed to promote productive employment and facilitate access to means for improvement of quality of life.  These cannot be restricted to those below the poverty line.  It can be safely asserted that the line artificially divides the poor. Redrawing the line by pushing down some of those who happen to be above the line is half-baked solution.  

The Planning Commission’s assurance at this juncture that welfare schemes would not stop at the line is gratifying. It has come too late after tremendous outpourings from the public. Still, poverty alleviation depends much on proper socio-economic surveys that are going on to help in identification of the poor above the poverty line and proper implementation of policies and programmes. Hope these shall do justice.-- -INFA

(Copyright, India News and Feature Alliance)