NEW DELHI: A new survey suggests that between 2011-12 there were 363 million people, or 29.5% of India’s 1.2 billion population, who lived in poverty- which is significantly higher than the previously estimated figure of only 269 million under the Congress-led United Progressive Alliance (UPA) regime.
The difference of about 94 million, is attributed primarily to a change in the definition of the poverty line considered by the panel, headed by former RBI governor C Rangarajan who also was the chairman of the prime minister’s economic advisory council in the UPA government. The new report was commissioned following widespread criticism two years ago that the government grossly underestimated the number of poor in the country by choosing an unrealistic poverty line for such estimates.
The Rangarajan panel found that almost one in three Indians was poor in 2011-12, because it considers people living on less than Rs. 32 a day in rural areas and Rs. 47 a day in urban areas as poor. In contrast, the official estimate- based on recommendations made by late economist Suresh Tendulkar, defines people living on less than Rs. 27 a day in rural areas and Rs. 33 a day in urban areas as poor.
These figures, ever since they were adopted by the UPA government during its first term, have been criticised for being unrealistic and artificially seeking to lower the poverty numbers. The Hindustan Times reports that the new estimates were submitted to the NDA government last week, but it is not clear whether these would be adopted as new official estimates on poverty.
The sharp revision in the poverty line is partly a result of a change in methodology. For sustenance, the new methodology includes all such expenses on account of basic amenities that are often covered by public expenditure. The new numbers mean that 363 million Indians would have struggled to survive if there was no public spending,” said a member of Rangarajan panel, who did not want to be named.
India’s poverty estimates are based on consumption expenditure surveys done by the National Sample Survey Office.
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