India has eliminated extreme poverty, US think-tank says, cites these reasons - Hindustan Times
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India has eliminated extreme poverty, US think-tank says, cites these reasons

By, New Delhi
Mar 03, 2024 09:33 AM IST

The Brookings Institution report has been authored by economists Surjit S Bhalla and Karan Bhasin.

India has eliminated extreme poverty as commonly laid out in international comparisons, according to US-based think-tank The Brookings Institution, which cited India's recently-released consumption expenditure data (for 2022-23) in its report.

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Also Read: India's GDP grew by 8.4 per cent in December quarter

The study has been authored by economists Surjit S Bhalla and Karan Bhasin.

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What does data show?

The data shows that since 2011-12, the country's real per capita consumption growth has been at 2.9%, while at 3.1% per annum, rural growth was significantly higher than urban growth (2.6%). Additionally, an ‘unprecedented’ decline was seen in both urban and rural inequality: 36.7 to 31.9 and 28.7 to 27, respectively (in terms of Gini coefficient, multiplied by 100).

Poverty in rural areas, meanwhile, was recorded at 2.5%, and 1% in urban areas.

“The data show a strikingly lower number of poor people in India. than those estimated by the World Bank,” the authors, Bhalla and Bhasin, wrote.

Why these results?

The duo noted that the comparatively higher consumption growth in rural areas ‘should not come as a surprise.’ This, they say, is because of the government's ‘strong policy thrust’ on redistribution by means of a wide variety of publicly-funded schemes, including both a national mission for the construction of toilets, and attempts to ensure universal access to each of these: electricity, modern cooking fuel, and piped water.

Also Read: Making sense of GDP numbers

An example is access to piped water in rural areas, which was 16.8% as of August 15, 2019, India's 73rd Independence Day, and, at present, stands at 74.7%, the report said.

Key takeaways

The official data, therefore, ‘confirms that India has eliminated extreme poverty,’ the report said, calling this an ‘encouraging development with positive implications' for global poverty headcount rates.

This further means that the country, much like other nations, must now shift to a higher poverty line, a transitions that will, in turn, provide an opportunity to identify intended beneficiaries in a better way, and offer greater support to those who are genuinely poor.

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