India Achieves Significant Milestone in Fight Against Poverty
India has achieved a significant milestone in its fight against poverty, according to a commentary authored by economists Surjit Bhalla and Karan Bhasin from The Brookings Institution. Citing recently released consumption expenditure data for 2022-23, the economists highlighted a sharp decline in extreme poverty across the country.
Growth in Per Capita Consumption
The data revealed that real per capita consumption in India has been growing at a rate of 2.9 per cent annually since 2011-12. Notably, rural areas have seen a higher growth rate of 3.1 per cent compared to urban areas at 2.6 per cent.
Reduction in Inequality
Furthermore, there has been an unprecedented reduction in both urban and rural inequality, as indicated by the decline in the Gini coefficient. The urban Gini decreased from 36.7 to 31.9, while the rural Gini dropped from 28.7 to 27.0. “In the annals of inequality analysis, this decline is unheard of, and especially in the context of high per capita growth,” the economists emphasized.
Impact on Poverty
The combination of robust economic growth and a substantial decrease in inequality has led to the eradication of extreme poverty in India, as per the report. The Headcount Poverty Ratio (HCR) has declined from 12.2 per cent in 2011-12 to a mere 2 per cent in 2022-23, equivalent to an annual decrease of 0.93 percentage points.
Rural poverty now stands at 2.5 per cent, while urban poverty has reduced to 1 per cent. The authors stated that these estimates do not account for the government’s provision of free food to a significant portion of the population, nor do they consider the utilization of public health and education services. The pace of poverty reduction in India is remarkable, with the country witnessing a decline that previously took three decades to achieve, now realized over just 11 years.
Policy Push for Reducing Inequality
The report attributes the relatively higher consumption growth in rural areas to the strong policy thrust on redistribution through publicly funded programs. These programs include initiatives such as the national mission for construction of toilets, universal access to electricity, modern cooking fuel, and piped water. Given the near elimination of extreme poverty, India should now graduate to a higher poverty line, which would provide an opportunity to redefine existing social protection programs to give greater support to the genuinely poor, the report suggests.
Positive Implications for Global Poverty Headcount Rates
“Official data now confirms that India has eliminated extreme poverty as commonly defined in international comparisons,” the economists said. This is an encouraging development with positive implications for global poverty headcount rates. This also means that the time has come for India to graduate to a higher poverty line much like other countries. The transition to a higher poverty line provides an opportunity to redefine existing social protection programs, particularly with the objective of better identification of intended beneficiaries and providing greater support to the genuine poor, it added.
Latest Consumer Expenditure Survey Indicates Low Poverty Rate
A latest consumer expenditure survey indicated that poverty has come down to five per cent in the country and people are becoming prosperous both in rural and urban areas, according to NITI Aayog CEO B V R Subrahmanyam. The survey data released by the National Sample Survey Office (NSSO) showed a significant increase in per capita monthly household expenditure in 2022-23 compared to 2011-12.
The NITI Aayog CEO stated that if the trend continues, it is possible that urban and rural incomes and consumption will be at the same level in the coming years. The survey also highlighted a decrease in the consumption of cereals and food in the country, indicating increased prosperity and spending on other goods and processed food.
Overall, these developments showcase India’s progress in achieving the Sustainable Development Goals (SDGs), particularly SDG 1: No Poverty and SDG 10: Reduced Inequalities. The country’s efforts in poverty reduction and inequality reduction have significant implications not only for its own population but also for global poverty rates.
SDGs, Targets, and Indicators in the Article
1. Which SDGs are addressed or connected to the issues highlighted in the article?
- SDG 1: No Poverty
- SDG 10: Reduced Inequalities
2. What specific targets under those SDGs can be identified based on the article’s content?
- SDG 1.1: By 2030, eradicate extreme poverty for all people everywhere.
- SDG 10.1: By 2030, progressively achieve and sustain income growth of the bottom 40 percent of the population at a rate higher than the national average.
- SDG 10.2: By 2030, empower and promote the social, economic, and political inclusion of all, irrespective of age, sex, disability, race, ethnicity, origin, religion, or economic or other status.
3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?
- Indicator for SDG 1.1: Headcount Poverty Ratio (HCR) – decline from 12.2% in 2011-12 to 2% in 2022-23.
- Indicator for SDG 10.1: Gini coefficient – decline in urban Gini from 36.7 to 31.9 and rural Gini from 28.7 to 27.0.
Table: SDGs, Targets, and Indicators
| SDGs | Targets | Indicators |
|---|---|---|
| SDG 1: No Poverty | 1.1: By 2030, eradicate extreme poverty for all people everywhere. | Headcount Poverty Ratio (HCR) – decline from 12.2% in 2011-12 to 2% in 2022-23. |
| SDG 10: Reduced Inequalities | 10.1: By 2030, progressively achieve and sustain income growth of the bottom 40 percent of the population at a rate higher than the national average. | Gini coefficient – decline in urban Gini from 36.7 to 31.9 and rural Gini from 28.7 to 27.0. |
| 10.2: By 2030, empower and promote the social, economic, and political inclusion of all, irrespective of age, sex, disability, race, ethnicity, origin, religion, or economic or other status. | No specific indicator mentioned in the article. |
Note: The article does not provide specific indicators for SDG 10.2, but the overall reduction in inequality can be seen as progress towards this target.
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Source: m.economictimes.com
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