Poor, poorer, poorest states? It's Bihar, MP, Odisha

The ongoing debate on the poverty line tells us nothing about where the country’s really poor live. The debate would, therefore, make more sense if regional poverty rates were taken into account.

A look at state-wise data reveals vast regional disparities in the level of poverty. Disturbingly, states with the highest poverty rates are also among the slowest in fighting poverty. This means that the poverty gap among states is on the rise.

The Tendulkar committee, which provided alternative (and higher) numbers on poverty after the official estimates received flak for using an outdated methodology that underestimated the proportion of poor in the country, puts Odisha as the state with the maximum proportion of poor at 57.2 percent in 2004-05.

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[caption id=“attachment_99609” align=“alignleft” width=“380” caption=“Owing to high poverty rates in some of the most populous Indian states like Madhya Pradesh, Uttar Pradesh, and Bihar, it is unsurprising that India’s total poverty is quite close to UP and Maharashtra’s rates at 37.2 percent. Desmond Boylan/Reuters”]  [/caption]

Odisha is followed by Bihar, Madhya Pradesh (MP), Uttar Pradesh (UP) and Maharashtra, according to data available for 17 states on the Planning Commission’s website. While over half the population in the states of Odisha and Bihar operates below the poverty line, Madhya Pradesh is just shy of 50 percent ( see table ).

Owing to high poverty rates in some of the most populous Indian states like Madhya Pradesh, Uttar Pradesh, and Bihar, it is unsurprising that India’s total poverty is quite close to UP and Maharashtra’s rates at 37.2 percent.

However, the all-India figures have seen a distinct decline from about a decade ago (1993-94), when the poverty rate was 45.3 percent - a whole 8 percentage points. The same cannot be said of the poorest states in the country. Madhya Pradesh, for instance, actually showed a four percentage points increase in its poverty rate over the 1993-94 to 2004-05 period.

While Madhya Pradesh was the only state to show an increase in poverty, other states with high poverty did not make much progress either. Odisha, for instance, has shown a miniscule improvement, of around 2 percentage points. Bihar, Uttar Pradesh and Maharashtra showed a more respectable decline of between 5-10 percentage points. However, even this comes up short against the more rapid strides made by states which also have overall lower poverty rates.

States like Jammu and Kashmir, Kerala, Himachal Pradesh, Haryana and Tamil Nadu, which had among the lowest poverty rates in 2004-05, have shown a substantial improvement ranging between 10-15 percent.

It maybe time to enlarge the poverty debate, not only to measure the number of poor but also with a view to closing regional disparities.