Hyderabad: A discussion paper released by the NITI Aayog, the government’s think-tank, in the middle of January, indicated that nearly 25 crore people in India "escaped" Multidimensional Poverty (MDP) over the past nine years.
This paper was authored by NITI Aayog member Ramesh Chand and senior advisor Yogesh Suri, with technical inputs from the United Nations Development Programme (UNDP) and Oxford Policy and Human Development Initiative (OPHDI).
Taking the clue from this discussion paper, Prime Minister Narendra Modi instantaneously claimed while addressing the beneficiaries of the 'Viksit Bharat Sankalp Yatra' (VBSY) that his government has made even the impossible possible through the transparent system created by it, coupled with focus on public participation. He said these are not merely statistics for him as every number represents a life who was deprived of the benefits of the government schemes so far.
However, the Congress party termed the NITI Aayog report's findings as the "latest jumla in a list of jumlas" and alleged that the government is hatching a "conspiracy" to exclude the marginalised populations from the safety net of welfare schemes and free ration.
Also, against the backdrop of the Union government's constant rhetoric of India emerged as the fourth largest economic power in the world poses some pertinent questions such as: Has India been moving on the trajectory of 'Viksit Bharat' by 2047 without poverty and hunger as enunciated by the Union government?
What are the theoretical, methodological, and empirical questions raised by the experts that remain unanswered? Is India's official statistical infrastructure suffering from increased politicisation and declining credibility? The NITI Aayog’s paper on MDP in India since 2005-06 claimed that India is well on track to achieve the UN-Sustainable Development Goal (SDG 1.2) of "halving multidimensional poverty" much ahead of 2030.
The paper further claimed that various government initiatives such as 'Poshan Abhiyan', 'Anaemia Mukt Bharat', and 'Ujjwala Yojana' have played a major role in mitigating different forms of deprivation. According to the paper, India has registered a significant decline in MDP from 29.17 per cent in 2013-14 to 11.28 per cent in 2022-23.
The so-called BIMARU states (BIMARU is an acronym for Bihar, Madhya Pradesh, Rajasthan, and Uttar Pradesh, a group of states that have historically logged in social and economic indicators) registered the largest decline; for example, 5.94 crore people in Uttar Pradesh escaped MDP, followed by Bihar at 3.77 crore, Madhya Pradesh at 2.30 crore and Rajasthan at 1.87 crore. The poorer states register faster decline in poverty, indicating reduced disparities.
What’s going wrong with the Poverty Estimations?
The National Multidimensional Poverty Index (NMPI) measures simultaneous deprivations across three equally weighted dimensions of health, education, and standard of living that are represented by 12 SDGs-aligned indicators, according to NITI Aayog.
Economists did not leave no stone unturned in raising their critical observations over the validity of the findings of the paper of NITI Aayog on the following points: MPI, Not an Acceptable Measure: First, many economists including Jean Dreze expressed reservations about the use of MPI in poverty measurement.
"MPI does not include any indicator of short-term purchasing power. Thus, we must read MPI data along with other information, including recent evidence of sluggish growth in real wages. MPI data can complement but not substitute for poverty estimates from consumer expenditure surveys that were long overdue [in India]," he lamented.
Low on Global Hunger Index: Second, there is the big anonymous as to why there has been a slide in India's performance on the Global Hunger Index (GHI) in recent times if there has been such impressive reduction in poverty. India was ranked 111 among 125 countries in 2023, and the only countries ranking lower than India were such as Afghanistan, Liberia, Central African Republic and Somalia. India's performance in terms of GHI score continued to be dismally low in last ten years.
Is it a Freebie?: Third, how can a nation achieve the UN-SDG 1 - concerning the Eradication of Poverty in all its forms, when its government has to ensure the survival of over 81 crore persons (over 57 per cent of population) at an approximate cost of Rs.11.8 lakh crore under the 'Pradhan Mantri Garib Kalyan Anna Yojana' (PMGKAY)? This is perhaps the world's largest food security scheme introduced during the COVID-19 pandemic in April 2020 for the benefit of the most vulnerable sections of the country.
Now, this scheme has been extended for a period of five more years till the end of 2028. What is the rationale behind the continuation of this scheme for over 57 per cent of Indians when the poverty has been reduced significantly in the recent past? Is it a freebie or a poverty reduction intervention?
Poverty of Data on Poverty: Fourth, for the past decade since 2011, India did not release any official poverty data. This led to different interpretations of the incidence of poverty in the country based on not-so-comprehensive data available from time to time in piecemeal. As a consequence, any debate on poverty in the absence of official data in India became controversial and meaningless.
If the data were authentic from credible sources, there would be no need for decorative attributions. Furthermore, the credibility of the statistical system in India has come into question over recent years. The government had refused to release a consumption expenditure survey results conducted by the National Sample Survey Organisation (NSSO) in 2017-18.
The Census enumeration scheduled to take place in 2021 has been pushed to 2024 25 until further orders. Due to the absence of authentic, comprehensive official data, the researchers are using projections in order to determine the numbers, and such "projected data" may be far from the ground reality. There is no prima facie reason for assuming that the 7.9 per cent per annum Gross Domestic Product (GDP) growth rate would deliver similar results to a period when the GDP growth rate for the recent nine years fell to 5.7 per cent per year.
We all know that COVID-19 affected all the 12 dimensions of NMPI adversely; however, peculiarly, in the NITI Aayog paper, the authors made yet another linear projection to extend their conclusions to two years beyond the end of COVID-19. In other words, in the paper the authors used data for non-COVID years to extend non-COVID rates of improvement after Covid, to 2022 and 2023. Thus, such illogical assumptions and methodological errors made the findings of the paper highly questionable and flawed.
Paradoxically, India, the fourth largest economy in the world that claims as 'Vishwa Guru' and that aims for 'Viksit Bharat' by 2047 has to depend on the research papers written by a few individuals or external agencies rather than its own professional body of statistical organisation and infrastructure.
Is India Ready to Heed the Nobel Laureates?
Abhijit Banerjee and Esther Duflo, who won the 2019 Nobel Prize in Economics, felt that in the absence of an authoritative survey-based data on India's poverty that is credible and politically insulated, it would be difficult to evolve an appropriate policy response because it is really necessary to know what is going on to be able to address the problem.
According to Abhijit Banerjee, India's national policy frame has not been really focused on inequality, and there is no real discourse about it. "The abuse of power was the primary source of inequality. Investment in education is important which is key to democracy in a deeper sense of giving everybody an opportunity; however, at the same time, education may become meaningless if labour markets did not provide jobs… Over-centralisation of power breeds unaccountability, and finally it leads to further poverty,” Abhijit Banerjee warned.
Swelling inequality India has emerged as one of the top countries with high income and wealth inequality, though the share of the population living in MDP fell from 25 per cent to 15 per cent between 2015-16 and 2019-21, the United Nations Development Programme (UNDP) revealed in its recent report. For this purpose, the international poverty measure of US$2.15 per day was considered.
Income and wealth disparities are worsening particularly in South Asia, where the wealthiest 10 per cent control over half of total income. Oxfam India's report disclosed that just 5 per cent of Indians own more than 60 per cent of the country's wealth, while the bottom 50 per cent of the population possess only 3 per cent of the wealth.
The widening income disparity among the working age population in India is also evident in a statistic provided in a Goldman Sachs report released on January 12. According to it, only 4.1 per cent (60 million) of working population in India earned an income of $10,000 per annum in 2022; whereas half of the working population (720 million) could earn a meagre annual income of $1500.
Reducing inequality within and among countries is the UN-SDG 10. Inequality threatens long-term social and economic development, harms poverty reduction and destroys people's sense of fulfillment and self-worth. Wages of 800 million workers globally have failed to keep up with inflation while wealth of five richest people has grown by $14 million an hour since 2020, says Oxfam in its recent report released on January 16.
Top 1 per cent of wealthy people own 43 per cent of all global financial assets! Oxfam’s revelation that for achieving the eradication of global poverty by 2030 as per the target enunciated in the UN SDGs – we may have to wait for another 229 years - came as a bomb shell!
