Monday, August 03, 2015

Tale of Poverty (2)

India's latest Socioeconomic and Caste Census (SECC) paintsa stark picture of widespread rural poverty and deprivation. It comes as no surprise that the bulk of the Indian population is still overwhelmingly poor. 

Of the 300 million Indian households surveyed, an overwhelming majority (73%) live in villages. Of this rural population, less than 5% earn enough to pay taxes, only 2.5% own a 4-wheeler vehicle and less than 10% have salaried jobs. Not only does rural India have miserable statistics on income and asset ownership, its literacy rates are low. Only 3.5% of students graduate and around 35.7% of residents can't read or write.

India's definition of "poor" has been debated by development economists and activists, with several finding the official poverty line too low and leaving out a number of people who might still need government assistance. In 2014, a report by the Indian government Planning Commission estimated that 363 million Indians, making up 29.5% of the total population, were living below the poverty line in 2011-12. The report, by the Rangarajan Expert Group, also estimates that the India poverty ratio fell from 38.2% to 29.5% between 2009-10 and 2011-12, lifting 91.6 million individuals out of poverty.

According to a Pew Research Center report released this month, while people were able to move up the social ladder from poor to low income during the last decade, the actual number of people in the middle class (living on $10-20 a day) barely budged from 1% in 2001 to 3% in 2011. Most developing countries set poverty lines far below those of advanced country levels.

Living on double the Indian Planning Commission poverty line of $2.40 per day would still mean not meeting nutritional and other needs at developed economy levels. Many poor people "lifted out of poverty" are still living at levels closer to $2.40 than $10 per day. The Pew report estimates that at the proposed Rangarajan poverty line, food consumption alone would take up 57% of a rural family's budget and 47% of an urban family's budget.

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