About 70 percent of India is poor: Top adviser

[anonymus]

Government in order to move away from poverty line on calorie intake method appointed suresh tendulkar commitee to review methodology to estimate poverty.

The recommendations were

1.Poverty estimate to be based on private household consumer expenditure of Indian households collected by National sample survey organisation.

2.Need to move away from anchoring poverty line to a calorie intake form.

3.Shift to MRP(mixed recall period) from URP (Uniform recall period)

4.MRP equivalent of Urban poverty line basket (PLB) correspond to 25.7% Urban headcount ratio as new reference PLB to be provided to rural as well as urban population in all the states after suitable adjustment.

5.The proposed reference of PLB takes into account all items of consumption except transport and conveyance for construction of price indices.seprate allowance for transportation and conveyance to be made in recommended poverty lines.

6.The proposed price indices are based on household-level unit values obtained from 61st round of the NSS on household consumer expenditure for food,fuel and light,clothing and footwear at the most detailed level of disaggregeration and hence much closer to actual price paid by consumers in urban and rural areas.The proposed price indices (Fischer ideal Indices) incorporate both all-India and state level consumption pattern in weighting structure of price indices.

Using this methodology the poverty ratio is

YEAR 1993-94​

Rural​

Urban​

Total​

Planning commission estimate

37.3​

32.4​

36.0​

Tendulkar committee estimate

50.1​

31.8​

45.3​

YEAR 2004-05​

Planning commission

28.3​

25.7​

27.5​

Tendulkar committee

41.8​

25.7​

27.5​

Saxena committee

The committee was appointed by rural development ministry on direction of sonia gandhi.it was headed by a socialist NC Saxena from sonia's kitchen cabinet.Being true to his idealogical beliefs he presented a wishlist.It is akin to ask OBL as to who are true muslims.

The committee recommended for some automatic exclusions and inclusions in BPL list

Exclusion

1.Families who hold more than three time the district average of agricultural land.Two times if completely irrigated.

2.Families having four wheel drives.

3.Families owning threshers and harvesters.

4.Families in which at least one person is drawing a salary of more than र10000/- with pensionary and retirement benefits.

5.Income tax payers

Automatic Inclusions

1.STs

2.SC's

3. Single mothers

4.Household with disables person as breadwinner

5.Household headed by a minor

6.Household with one or more beggars.

7.Household which had bonded labour as member.


This methodology gave a pre-BPL census estimate of poverty at 70% because of bolded portions.


Now the pitfalls of producing 70% figure from one's a$$ are

1.Poverty line is not a dick measuring contest.A person qualifying as poor is provided 35 Kg of Rice and wheat at र2/-(4 cents).His family is provided subsidised housing under Indira awas yojna.He/she is provided a farmland if there is some left over land with panchayat along with many assorted benefits.A person identified as poor is a drain on exchequer.

2.The idea of 70% poors in a country is preposterous.If 70% people are poor than there is some problem in definition of poverty.

3.To keep 70% people on welfare,30% top earners would have to take upon themselves backbreaking load of taxation in effect punishing people for not being poor.

4.There is a saying in economy that "There are no free lunches".If government scales up its welfare programs it would lead to excess liquidity which would cause runaway inflation in effect making everyone poor.

5.India's gini coefficient is still 38 putting india in countries where distribution of wealth is even.

6.It don't takes into account black economy.The whole burden of taxation would be born by salaried class as they can't hide their income by simply not declaring it.

7.World bank defines poverty line as $1.25 PPP which translates roughly to र25/- in Indian currency.India's poverty line after taking tendulkar committee is already higher than this.

 

[shuttler]

http://timesofindia.indiatimes.com/city/delhi/Not-easy-to-be-poor-when-poverty-ends-at-Rs-34-67/articleshow/12347750.cms

"Asian Development Bank's recent report that predicts a 10% rise in food prices could push almost 3 crore more Indians into extreme poverty....."

 

[Hello_10]

it is the social workers' job to do the survey reflecting the true picture of poverty not tax collectors. another exercise which is very important to reflect genuine social status of a country is the census

Sir, per capita income of India on PPP in January 1990 was around 20% higher than China and you would be surprised to know that per capita income on PPP of Pakistan was around 40% higher than China in January 1990. But now, you find per capita income of China around 2.2 times to that of India on PPP and around 3.2 times to that of Pakistan by 2011. its because China adopted "One Child Policy" along with excellent growth of around 10% average since 1990 while India grew with around 7% average since then with around 1.4% population growth, while Pakistan’s growth rate was hardly around 5% since 1990 with 2.5% population growth so now we find the data’s quite different now. You have to control population and learn from China, which is true for all the South Asian countries like India/ Pakistan/ Bangladesh etc. Even if Pakistanis industries aren’t competitive enough like China to achieve very high growth from external demand, they would at least learn from India whose internal growth has helped them achieve 7% growth rate since 1990. Its bad to see that the highest per capita income South Asian country in 1990, the Pakistan, is now among those who has to catch up with rest of Asia.

for CHina check, China GDP per capita PPP

for India, India GDP per capita PPP
and for Pakistan, check their data in January 1990 and compare with India's/ China's in 1990,
Pakistan GDP per capita PPP

 

[shuttler]

Sir, per capita income of India on PPP in January 1990 was around 20% higher than China and you would be surprised to know that per capita income on PPP of Pakistan was around 40% higher than China in January 1990. But now, you find per capita income of China around 2.2 times to that of India on PPP and around 3.2 times to that of Pakistan by 2011. its because China adopted "One Child Policy" along with excellent growth of around 10% average since 1990 while India grew with around 7% average since then with around 1.4% population growth, while Pakistan’s growth rate was hardly around 5% since 1990 with 2.5% population growth so now we find the data’s quite different now. You have to control population and learn from China, which is true for all the South Asian countries like India/ Pakistan/ Bangladesh etc. Even if Pakistanis industries aren’t competitive enough like China to achieve very high growth from external demand, they would at least learn from India whose internal growth has helped them achieve 7% growth rate since 1990. Its bad to see that the highest per capita income South Asian country in 1990, the Pakistan, is now among those who has to catch up with rest of Asia.

for CHina check, China GDP per capita PPP

for India, India GDP per capita PPP
and for Pakistan, check their data in January 1990 and compare with India's/ China's in 1990,
Pakistan GDP per capita PPP

well Hell_10 you have made great efforts tallying all these numbers and statistics. My point is to resolve and really understand the true poverty of a nation one needs to go into the neglected or "undocumented" mass and get first hand account of their difficulties. This is one way to address the issues about "undocumented" data.

 

[53fd]

I think it is unwise to look at the poverty levels %, as India has set a far lower poverty line than the international standard, & keeps "revising" it every now & then to make those statistics look better. A better statistic would be the % of population that earns < $1 a day, & < $2 a day.

 

[Hello_10]

http://timesofindia.indiatimes.com/city/delhi/Not-easy-to-be-poor-when-poverty-ends-at-Rs-34-67/articleshow/12347750.cms

"Asian Development Bank's recent report that predicts a 10% rise in food prices could push almost 3 crore more Indians into extreme poverty....."

also, and its interesting to see that GDP per capita of Russia was around $9,116 on PPP in January 1990, at the prices in 1990, which was around 12 times to that of China in January 1990, two time to Poland/ Argentina type countries in 1990 and was not much behind Britain which had around $15,000 per capita income in January 1990.

Russia GDP per capita PPP

 

[foxbat]

I think it is unwise to look at the poverty levels %, as India has set a far lower poverty line than the international standard. A better statistic would be the % of population that earns < $1 a day, & < $2 a day.

I think the more acceptable metric is the Human Development Index used by UNDP where Poverty is one of the multiple indices used to determine the quality of life in a country

 

[nalandapride]

I think it is unwise to look at the poverty levels %, as India has set a far lower poverty line than the international standard. A better statistic would be the % of population that earns < $1 a day, & < $2 a day.

India follow world Banks level of Poverty line $1.25(PPP) which comes out to be 26 rupees minimum. ($1(nominal)=$2.5 (PPP))

But enlightened civil society want more than this for our people.

 

[53fd]

I think the more acceptable metric is the Human Development Index used by UNDP where Poverty is one of the multiple indices used to determine the quality of life in a country

The topic is strictly about poverty, not the HDI. Please stick to the topic.

 

[Ammyy]

The topic is strictly about poverty, not the HDI. Please stick to the topic.

This is not official data do you even think this deserve to be a topic ????

 

[majesticpankaj]

i think the standards are pretty well... 1.25$ at ppp is close to 26 rs and add to government subsidies on food, fuel, free education and free healthcare. that is pretty good.

 

[JohnyD]

India's 0.51 billion population is not poor!

 

[StingRoy]

I think the more acceptable metric is the Human Development Index used by UNDP where Poverty is one of the multiple indices used to determine the quality of life in a country

I support HDI and Happiness Index to be the standard. Needless to say we aren't doing too good on these metrics either.

Shame on the planning commission on setting these limits and the govt trying to defend it.

Sounds almost ridiculous to us living in the cities, while I believe their argument for the villages. It is much cheaper to live in the villages in India. Except for rice and pulses, the vegetable costs are sometimes 1/4th of what we pay in the cities.... most grow their own and are able to survive.

 

[Hello_10]

well Hell_10 you have made great efforts tallying all these numbers and statistics. My point is to resolve and really understand the true poverty of a nation one needs to go into the neglected or "undocumented" mass and get first hand account of their difficulties. This is one way to address the issues about "undocumented" data.

Sir economics is a funny subject, no matter how much command we have in this field, we always have to say &#8216;estimate only&#8217;, &#8216;almost&#8217; etc . as, there is always something to count/ add, keep revising the datas on time to time with new information etc. and, &#8216;undocumented&#8217; part of GDP is a reality for the developing countries and how will we measure the true picture of an economy if we don&#8217;t count around 50% to 60% of their undocumented part which is a truth? the efforts were to say, the GDP which we see includes only what the governments could &#8216;document&#8217;.

And Sir, its written on the wall that if India categorize its poor in a right way then its &#8216;correct&#8217; to say that 70% population of India is poor. I support it and it&#8217;s a truth and the reason I had mentioned in my link of an Indian movie, its the over population. I support the claim on the fact that if we raise the &#8216;cut off&#8217; of measuring poverty, 70% Indians would easily fall in it, and we find it correct.

But we also consider the fact that World Bank says even per capita income of $1.25 on PPP is &#8216;enough&#8217; to say he/ she can feed themselves, then here, yes this is also a &#8216;cut off&#8217; of measuring poverty

 

[shuttler]

Sir economics is a funny subject, no matter how much command we have in this field, we always have to say &#8216;estimate only&#8217;, &#8216;almost&#8217; etc . as, there is always something to count/ add, keep revising the datas on time to time with new information etc. and, &#8216;undocumented&#8217; part of GDP is a reality for the developing countries and how will we measure the true picture of an economy if we don&#8217;t count around 50% to 60% of their undocumented part which is a truth? the efforts were to say, the GDP which we see includes only what the governments could &#8216;document&#8217;.



And Sir, its written on the wall that if India categorize its poor in a right way then its &#8216;correct&#8217; to say that 70% population of India is poor. I support it and it&#8217;s a truth and the reason I had mentioned in my link of an Indian movie, its the over population. I support the claim on the fact that if we raise the &#8216;cut off&#8217; of measuring poverty, 70% Indians would easily fall in it, and we find it correct.

But we also consider the fact that World Bank says even per capita income of $1.25 on PPP is &#8216;enough&#8217; to say he/ she can feed themselves, then here, yes this is also a &#8216;cut off&#8217; of measuring poverty

The % of 50 or 60 or whatever % is just a wild guess with nothing to substantiate, isn't it Hello+10? I do agree there has to be a cut off standard for the sake of measurement, and from there to devise government planning on a macro perspective.

Also one thing that is highlighted in the OP's article is the dire lack of basic facilities. This plight adds difficulties to the poor but they are not quantified or they are in existence but not quantifiable as factors in calculation of the poverty measurements