Assessment of the growth experience: Poverty and Unemployment
- Poverty and unemployment are closely related
- High poverty has a multiplier effect on quality of life, deprivation, malnutrition, illiteracy and low human resource development.
Poverty
- Poverty lines
- Normative nutritional requirement per person per day at some base point.
- This is debated
- 2400 cal (rural), 2100 cal (urban)
- Nutrient requirement then needs to be translated to monetary terms.
- Poverty has declined as per NSSO estimates.
- However, recent committees like the Tendulkar committee have reviewed the methodology of measuring poverty and concluded that poverty levels are much higher than those presented through the NSSO estimates.
- Data on poverty reduction <put>
- Rural-urban and regional disparity
- Even when poverty has declined there has been a marked disparity in its reduction in rural and urban areas as well as across different regions in the country
- — states have poverty ratio below the national average
- Significant reduction in Andhra, Gujarat, Haryana, Karnataka, Kerala, Maharashtra, Punjab and WB
- Most poor states of Bihar, MP, Orissa and UP have shown little progress in poverty reduction
- Over 54 pc of India’s poor lived in these states in 2004-05
- These states have more poor than 26 sub-Saharan African countries according to the 2010 HDR
- North-western states (P, H, HP, J&K) comprise only 2.2 pc of India’s poor. Rural urban disparity is minimal
- More than half of India’s urban poor live in the states of Maharashtra, MP, UP and TN
- There is no evidence for convergence in the incidence of poverty across the states of India
- Coeffcient of variation (CV) of poverty reveals widening inter-state inequalities in poverty reduction. Between 1993-94 and 2004-2005 CV increased from 36 to 54.
- Non-income dimensions of poverty
- NFHS-3 and District level Household Survey on Reproductive Health
- 46 pc children under 3 and 49 pc children under 6 malnourished
- 79 pc children anaemic
- 59 pc deliveries did not take place in institutional agencies
- 32 pc have no electricity, 55 no toilet
- Multidimensional Poverty Index
- NFHS-3 and District level Household Survey on Reproductive Health
- Economic Growth and Poverty
- Necessary for poverty reduction, but not sufficient
- This is because
- Poverty is not only income poverty. There are various other unfreedoms. The MDPI captures this well
- Enabling role of basic education, good health, land reforms, social security
- The fruits of economic growth may not be automatically utilised to expand basic social services
- Eliminating deprivation is as much a matter of public action as one merely of economic growth.
- There has been no significant acceleration in the process of poverty reduction during 1980-2005 despite an acceleration in the growth of per capita GDP
- Since public action is required, schemes such as NREGS and SGSY are important
- Chronic Poverty
- Higher among rural casual labour households than urban casual labour households
- Varies significantly across social and occupational groups and is highest for SCs
- Poverty in India vs other developing countries
- China
- Poverty in China declined from 53 pc in 1981 to 8 pc in 2001. In the same period India reduced poverty by 17 pc
- India fares badly even on non-income dimensions of poverty like malnutrition, infant mortality
- Concerns about equity and disparity remain in China too. India has fared better than China in achieving lower inequality
- Poverty and Planning/inclusive growth <see poverty notes>
- Strategy to deal with the problem
- Recognize that poor are hetrogenous. So strategies need to be specifically designed to deal with chronic poor and other poor
- Design safety nets
- Strengthen livelihood and make them more productive
- China
Obsession with economic growth? <Notes from Sen’s article>
- Economic growth helps in advancing living standards and in battling poverty
- Growth, however, should not be taken to be an end in itself
- Sustainable economic growth
- Focus on development
- The good thing about economic growth is that it generates resources for the government to spend according to its priorities
India-China comparision
| Parameter | India | China |
| LE | 64.4 | 73.5 |
| IMR | 50 | 17 |
| U-5 MR | 66 | 19 |
| Literacy | 65 | 94 |
| Mean years of schooling | 4.4 | 7.5 |
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