Economy

NITI Aayog panel’s draft report treads cautiously on poverty

Amiti Sen New Delhi | Updated on January 24, 2018

Sends draft to States for comments; to be finalised by Governing Council



The NITI Aayog taskforce on eliminating poverty has decided to tread the middle path on the contentious issue of whether to have a poverty number to identify the poor or just use deprivation indicators for decision making.

In its draft discussion paper on mitigating poverty, which has been sent to the States for comments, the taskforce, under the Aayog’s Vice-Chairman Arvind Panagariya, has placed arguments both in favour of and against the need for a poverty number.

“The Governing Council of NITI Aayog, which will vet the final draft, will take a final view on issues raised in the discussion paper,” a government official told BusinessLine. States are supposed to give their comments on the draft by mid-August.

The panel includes NITI Aayog member Bibek Debroy, Chief Statistician TCA Anant, economist Surjit Bhalla and secretaries from the ministries and departments of rural development, housing and urban poverty alleviation, financial services, MSME and skill development.

The discussion paper also states that in case a poverty number is required, it may not be necessarily calculated by the NITI Aayog. It could be calculated jointly by the Rural Development Ministry, which would give the number for rural poor, and the Urban Poverty Alleviation Ministry, which would give the number for urban poor, or the statistical commission.

“People have already started making calculations on rural poverty based on the recent findings of the Socio Economic and Caste Census (SECC), 2011, of the Rural Development Ministry. Although the survey is a sensitivity analysis based on certain deprivation indicators, a number can be calculated if you decide on the indicators to include and add them up,” the official said.

Urban poor

The Urban Poverty Alleviation Ministry is carrying out a similar census, which will also throw up a number for the urban poor.

“We need to just calculate the aggregate to come out with a national poverty number,” the official said, quickly adding that a decision on the matter has not yet been taken.

Giving arguments in favour of doing away with poverty numbers, the document has said that none of the anti-poverty programmes, such as the Indira Awas Yojna and the Antodaya Scheme, are contingent on using anti-poverty numbers.

Moreover, the definition of poor might also differ between various sectors. A household that is considered poor for a housing programme may not qualify under a food programme.

However, the document adds that poverty numbers may be needed for two reasons; one, if there is some percentage of subsidy in poverty schemes borne by the Centre and two, poverty numbers may be needed for particular States.

Also when Sustainable Development Goals are in place — they may have targeted poverty reduction numbers — the country would need a baseline as a measure of its performance.

The taskforce’s document has suggested to States that they use the Socio Economic and Caste Census survey, wherever suitable, for their welfare programmes.

The SECC has automatically excluded 39.39 per cent of the rural population from the list of poor based on 14 parameters, included 0.92 per cent based on five parameters and has divided the rest on the basis of seven deprivation indicators.

The Rural Development Ministry has reportedly classified 31.26 per cent of rural households as poor based on about four of the seven indicators.

The Rangarajan committee, a technical expert group set up by the UPA in 2012, had classified 30.95 per cent of rural Indians as poor in 2011-12.

Published on July 23, 2015

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