Good news: Poverty has shrunk to a record 22%, says Plan Commission

Poverty in India declined to a record 22% in 2011-12, the Planning Commission disclosed on Tuesday. The new rate implies poverty has declinedby nearly three times under UPA rule since 2004-05 compared to the 11 years before that.

Over the last decade, poverty has witnessed a consistent decline with the levels dropping from 37.2% in 2004-05 to 29.8% in 2009-10.

The number of people living below the poverty line hasshrunk to 21.9 percent in 2011-12 from 37.2 percent in2004-05 on account of increase in per capita consumption. In absolute terms, the number of people surviving precariously on the edge of poverty had dwindled to 26.93 crore in 2011-12 from 40.71 crore in 2004-05.

According to these estimates every eighth person person living in urban areas is below the poverty line, while one in five rural residents is poor.

The sharp drop was attributed to the high real growth in recent years, which raised the consumption capacity.Economists attributed these figures to the sharp increase in wages under the Mahatma Gandhi national rural employment guarantee scheme, which is touted as the world's largest welfare programme.

However, critics believethis is the outcome of the trickle-down impact of the record growth witnessed in the first decade of the new millennium. The planning commission has also been slammedfor a statistical sleight of hand made possible by using a formula that has been discredited and is due to be revised next year.

"The data showed that nearly 2 crore people were pulled out of poverty every year from 2004-05 onwards, which resulted in a sharp drop in those below the Tendulkar poverty line to 27 crore in 2011-12 from 40.7 crore in 2004-05," an Economic Times report said.

 Good news: Poverty has shrunk to a record 22%, says Plan Commission


According to the Commission, in 2011-12 for rural areas,the national poverty line by using the Tendulkar methodologyis estimated at Rs 816 per capita per month in villages and Rs1,000 per capita per month in cities.This would mean that the persons whose consumption ofgoods and services exceed Rs 33.33 in cities and Rs 27.20 percapita per day in villages are not poor.

Earlier, the Planning Commission had triggered a majorcontrovery by saying anyone spending more than Rs 32 per dayin urban areas was not poor. This criteria for fixing povertyline was criticised across the political spectrum as beingunrealistic and unmindful of present day realities.

Planning Commission gave out the poverty ratiousing the same criteria saying the number poor in the countryhave shrunk in the past 7 years.The Commission said that for a family of five, the allIndia poverty line in terms of consumption expenditure wouldamount of Rs 4,080 per month in rural areas and Rs 5,000 permonth in urban areas. The poverty line, however, will varyfrom state to state.

State-wise, the Commission said the poverty ratio washighest in Chhattisgarh at 39.93 per cent followed byJharkhand (36.96%), Manipur (36.89%), Arunachal Pradesh(34.67%) and Bihar (33.47%).

Among the union territories, the Dadra and Nagar Haveliwas the highest, with 39.31 per cent people living belowpoverty line followed by Chandigarh at 21.81 per cent.Goa has the least percentage of people living belowpoverty line at 5.09 per cent followed by Kerala (7.05%),Himachal Pradesh (8.06%), Sikkim (8.19%), Punjab (8.26%) andAndhra Pradesh (9.20%).

With inputs from Agencies

Updated Date: Dec 20, 2014 21:12:12 IST