The poverty bar will soon be raised. With it, 38 per cent of India’s population will fall below the poverty line, instead of 28.5 per cent, as at present.
A family of five with an income of less than Rs 3,000 a month in urban and Rs 2,250 in rural areas should be considered poor, says the interim report of a committee directed by the Planning Commission to formulate fresh criteria for determining how poverty should be defined.
At present, using standards laid down in 1998, an urban family earning Rs 2,200 per month or less and a rural family earning Rs 1,650 or less is ‘poor’.
The raised bar will lead to many more people being classified poor. While urban poverty will increase slightly from 26 per cent to 28 per cent, rural poverty will jump from 30 per cent to 46 per cent.
“The report, once accepted, will resolve disparities in urban and rural poverty and make poverty estimation more equitable,” said Planning Commission member Abhijit Sen.
Headed by Suresh Tendulkar, former chief of the PM’s economic advisory council, the committee looked at more parameters than its predecessors.
Earlier, a family was called poor only if it lacked the income to buy food containing a minimum number of calories per day — 2100 calories for urban areas and 2400 for rural areas.
Tendulkar’s committee, however, has estimated the minimum income required to rise above poverty by looking at expenditure on education, health and sanitation too – apart from food. It has also recommended that no distinction should be made between urban and rural households as far as calorie intake.
“We will fine tune our observations and submit the final report next month,” Tendulkar told HT.