A new indicator to measure “extreme poverty” is likely to be developed by NITI Aayog after consultations with several ministries, official sources told FE.
The think-tank is expected to form a committee to first fix a threshold income level, which can be used to measure extreme poverty, and then formulate a methodology to measure it on a periodic basis, an official said.
A new indicator to measure “extreme poverty” is likely to be developed by NITI Aayog after consultations with several ministries, official sources told FE.
The think-tank is expected to form a committee to first fix a threshold income level, which can be used to measure extreme poverty, and then formulate a methodology to measure it on a periodic basis, an official said.
“The NITI Aayog may hold a meeting this month with several ministries, where deliberations will take place to measure extreme poverty,” an official said.
“This figure will be different from the multidimensional poverty. It will measure poverty on an income-based approach…but NITI Aayog has to take the final call,” another official said.
At present, the government reckons that any individual living earning below $1.25 per day is living in “extreme poverty”. The figure was adopted by the United Nations to measure destitution in 2015, and India has gone by this. However, since then, the Centre has not made any attempt to revisit the threshold. In fact, no survey till date has been conducted to measure extreme poverty in the country, post 2015.
The last survey to measure income-based poverty was done in 2011-12, and its results were released in 2013. The survey has estimated poverty based on the Tendulkar line, which states any individual earning below Rs 33/day should be considered as living under poverty. According to the 2011-12 survey, 21.9% people of the total population, or 269.3 million individuals were found to be living under poverty.
N R Bhanumurthy, professor, National Institute of Public Finance and Policy (NIPFP) said, “measuring extreme poverty through an indicator will help achieve basic requirements of SDGs, but the focus should be on measuring multidimensional poverty, and reducing it.”
Earlier, an in interview to FE, NITI Aayog Member Arvind Virmani had said: “Multidimensional poverty index (MPI), though another way of estimating poverty, doesn’t give useful information.”
“Poverty is indicated through income. I have been in favour of estimating poverty through income only,” Virmani had said. “The concept of income and consumption is very clear, since 1960s. Having an index (MPI) actually gives a confusing picture.”
The NITI Aayog currently measures poverty through MPI. The MPI captures overlapping deprivations (dimensions of poverty) in health, education and living standards.
Under the Global Indices for Reforms and Growth (GIRG) mandate approved by the central government in February 2020, 29 select global indices are to be monitored to evaluate and improve India’s global ranks in tackling MPI. The national MPI is in step with the SDG, which aims to reduce “by at least half the proportion of all men, women and children of all ages living in poverty in all its dimensions according to national definitions” by 2030.
In January, the NITI Aayog had said that an estimated 248.2 million people moved out of multidimensional poverty between 2013-14 and 2022-23. Based on the interpolation of the multidimensional poverty index (MPI) estimates between 2005-06 and 2015-16, the headcount ratio for the year 2013-14 comes to 29.17%. Similarly, the proportion of multidimensional poverty for the year 2022-23 is projected to be 11.28% based on the trend rate of 10.66% decline per year between 2015-16 and 2019-21.
In its latest progress report of achieving SDGs, the ministry noted that the government’s comprehensive strategy to eliminate poverty in all forms, has led to a drastic fall–to the tune of about 10 percentage points–in the proportion of men, women and children of all ages living in poverty “in all its dimensions”. Between 2015-16 and 2019-21, the percentage of people living in poverty sharply fell from 25% to 15%.
Govt to bring back income-based poverty estimate, NITI Aayog to play nodal role