With its sights set on eliminating extreme poverty by 2030, India has launched a national indicator to measure poverty and track progress precisely
In a major step towards eradicating extreme poverty by 2030, the statistics ministry has announced the development of a national indicator to measure this critical issue. The government defines "extreme poverty" as living on less than $1.25 per day. This definition aligns with international standards. Previously, India lacked an official poverty line, relying on estimates based on multidimensional factors beyond just income. This new national indicator will provide a clear and consistent measure of extreme poverty. Economist P Chidambaram has expressed a dissenting view, arguing that India has no poor.
Independent reports by the World Bank and IMF have offered different estimates of extreme poverty in India, using a slightly higher threshold of $1.90 per day (adjusted for purchasing power). Interestingly, the World Bank's definition aligns with the poverty line calculated by the Tendulkar Committee in 2004-05, when adjusted for inflation. The statistics ministry report, citing NITI Aayog, a government think tank, highlights a significant reduction in poverty over the past decade. The report claims that the proportion of people living in poverty across all dimensions decreased from 24.85 percent in 2015-16 to 14.96 percent in 2019-21.
The report credits sustained economic growth (averaging 6.7 percent between 2016 and 2020) and various government welfare schemes focused on crucial areas like nutrition, healthcare, education, housing, sanitation, and skill development for this progress. NITI Aayog estimates that between 2013-14 and 2022-23, approximately 248.2 million people lifted themselves out of multidimensional poverty. This achievement aligns with the UN Sustainable Development Goals (SDGs) adopted in 2015, which aim to halve multidimensional poverty by 2030.
The report also presents projections based on previous trends. Using data from 2005-06 and 2015-16, the estimated headcount ratio for multidimensional poverty in 2013-14 was 29.17 percent. Following the decline rate observed between 2015-16 and 2019-21 (10.66 percent per year), the projected poverty ratio for 2022-23 is 11.28 percent.
The development of a national indicator for extreme poverty signifies India's commitment to tackling this critical issue. With precise measures and ambitious goals, India is well-positioned to achieve its vision of eradicating extreme poverty by 2030.