UNDERSTANDING POVERTY: Reader's Digest


Readers' Digest, June 2015 Letters UNDERSTANDING POVERTY Most of the nations listed as former recipients of aid still have populations still living below the povertyline. In India, we need a nationally accepted method to determine this line, which may vary for geographical regions. M G WARRIER, Thiruvananthapuram Submitted version: Letters/IN MY OPINION April 4, 2015 Playing safe on poverty This refers to the article “3 Myths About the World’s Poor” (RD, April 2015). The pleasant thoughts about improvement in global poverty level are soothing. Per capita income adopted for estimation of poverty level of countries is misleading. The eleven countries listed as former recipients of aid together have a population of 51 crore and about 25 percent of the population under poverty line. Back in India (a country with a population of 125 crore of which 30 per cent still remain below the Poverty Line) NITI Aayog has taken a stand not to estimate its own poverty line. Still, poverty elimination (as has been achieved only in Singapore with a population of 56 lakhs on this part of the globe) there is a need to have a nationally accepted method to arrive at poverty line- even if the line for different geographical regions within India may vary- and that method having the sanction of NITI Aayog and GOI. This is because several government schemes for poverty alleviation(now poverty elimination) relate the eligibility criteria to poverty line. International comparisons, fear of loss of image if the number of those below poverty line goes up during a particular period, total disconnect of poverty line or comparable indicator for different countries with purchasing power parity and several other constraints make poverty estimation highly subjective and sometimes prejudiced in India. Economists and consultants help out policy makers in such situations by creating confusion with figures.There cannot be a better method than the one based on spending capacity and purchasing power of the rupee. Once NITI Aayog decides on the poverty line for the purpose of extending benefits under central schemes, some agency should estimate and publish information about Indians living below poverty line and proportion of the population with (a) capacity to spend double the expenditure ceiling for poverty line (b) capacity to spend four times the ceiling (c) capacity to spend eight times the ceiling and (d) others. Such an estimation will help Gates family to revisit their views on the myths they have exploded. M G Warrier, Thiruvananthapuram

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