Skip to main content

India's poverty estimate would go down to 12.4% from 21.2% if new methodology is adopted: World Bank report

By Rajiv Shah
The World Bank wants India to urgently rework its methodology of estimating poverty, more "compatible" with international estimates, saying if it does so, it “would eventually lead to a substantial downward revision of the poverty numbers in India” – from 21.2 per cent to nearly half of it, about 12.4 per cent, as worked out for the period 2011-12.
It is not known if the Government of India will accept the new methodology. If it does, the BJP-led government can go around propagating how poverty in India has substantially gone down, just as it did while revising GDP methodology, showing a higher GDP growth than previously estimated.
However, there is a risk in estimating lower poverty rates: It would mean providing fewer doles to people under populist programmes, alienating lots of people getting advantage of subsidies because they are categorised as poor.
Taking strong exception to the way India has been estimating poverty, the World Bank says, in its new report, “Poverty and Shared Prosperity 2016: Taking on Inequality”, had to take the total poor population in India “based on estimates rather than actual numbers provided through a household survey”.
“Such estimates are subject to a great deal of uncertainty, which typically arises because of revisions of national accounts in each country”, the World Bank notes, adding, India’s estimates “reflect the government’s periodic revisions of the growth in private consumption expenditure and the population.”
Giving the example of two years, 2013 and 2012, the World Bank notes, “Notwithstanding the revisions, no methodological change underpins the 2013 poverty estimates for India with respect to 2012.”
Pointing out that the poverty estimates for India at the global poverty line are “historically based on the Uniform Reference Period consumption aggregate, which involves a 30-day recall among respondents in the recording of all items of consumption”, the World Bank notes, “For 2011-12, this implies a poverty rate of 21.2 per cent at the US$1.90 poverty line.”
“Since 2009”, the World Bank says, “However, the Multiple Mixed Reference Period has also been used in the collection of consumption data. The methodology is closer to best international practice. It relies on recall periods among respondents of 7, 30, and 365 days, depending on the items of consumption.”
Pointing out that this methodology relies on “recall periods among respondents of 7, 30, and 365 days, depending on the items of consumption”, the World Says, “If the consumption estimate derived from the latter methodology had been used to estimate India’s poverty rate, the result at the US$1.90 poverty line would have been a substantially lower 12.4 per cent in 2011-12.”
It underlines, “The application of the methodology is still being tested. Its adoption would eventually lead to a substantial downward revision of the poverty numbers in India.”
Based on the old methodology, India, the World Bank says in its report, is by far the country with “the largest number of people living under the international US$1.90-aday poverty line, 224 million, more than 2.5 times as many as the 86 million in Nigeria, which has the second-largest population of the poor worldwide.
Pointing towards the scale of poverty in India, the report notes, “Whereas the annual mean income among the bottom 40 in the United States is US$8,861 per person, the bottom 40 earn US$1,819 in Brazil and US$664 in India, about 13 times less than in the United States.”
The report says, “Only the top 10 in India earn sufficient average incomes to be part of the bottom 40 in the United States if that is where they had been located”, adding, “The increase in inequality in India has been more muted and began in the second half of the 2000s.”

Comments

TRENDING

Missed call drive for VVPAT verification follows online plea to "pressure" poll panel

By Our Representative
Several political activists have begun a new campaign, asking concerned citizens to give a missed call on 9667655855 to “support the demand that 2019 Loksabha elections must be declared only after verification of 50% electronic voting machines (EVMs) with Voter Verifiable Paper Audit Trail (VVPAT) receipts.” The effort, supported by civil society networks across India, is meant to "further pressure" India's election machinery to ensure that the poll outcome becomes more transparent.

Did Modi own, buy digital camera costing Rs 7 lakh in 1987-88, also used email?

Counterview Desk
In an interview to the news channel News Nation, aired on Saturday last, Prime Minister Narendra Modi declaring that he had approved the air strike despite bad weather because he felt the clouds would hide Indian planes from Pakistani radar is known to have become a laughing stock across India.

When a neo-nationalist "invaded" hijab clad ladies, Bengali looking scholar in Delhi metro

By Aditi Kundu*
Travelling in Delhi metro on a daily basis to commute from Mayur Vihar to Dwarka, I see diverse people everyday. One can hear them talk about different aspects of life, from kitchen pilitics to national politics. On the morning of May 13, I witnessed a strange incident; disturbing and amusing at the same time.

Terror attacks: Difference in public reactions in India, those in Colombo, Christchurch

By Battini Rao*
Recently, on April 20 during Easter Sunday, more than 250 people were killed in a series of coordinated terrorist attacks in churches and hotels in Colombo, Sri Lanka. Local Islamic organisations Thawheed Jamath (NJT) and Jamathei Milathu Ibrahim (JMI) are held responsible for the attack. Islamic State has also claimed responsibility.

Women lost 88 lakh jobs in 2018: Why Modi "failed" to address their disempowerment?

Counterview Desk
Five human rights leaders Anjali Bhardwaj, Shabnam Hashmi, Purnima Gupta, Dipta Bhog, and Amrita Johri of the Women March for Change have posed 56 questions (alluding to Modi’s claim of 56 inches chest) to Prime Minister Narendra Modi and BJP against the backdrop of his interview with a Bollywood star, which was allegedly masqueraded as a “non-political” conversation.

World Bank clarifies: Its 26th rank to India not for universal access to power but for ease of doing business

By Our Representative
In a major embarrassment to the Government of India, the World Bank has reportedly clarified that it has not ranked India 26th out of 130 countries for providing power to its population. The top international banker’s clarification comes following Union Power Minister Piyush Goyal’s claim that India has “improved to 26 position from 99” in access to electricity in just one year.

Disproportionately high death sentences against Dalits, Adivasis, Muslims: UN told

Counterview Desk
In their joint submission to the United Nations Human Rights Committee to meet for the listing of adoption of list of issues at its 126th session, July 1-26, 2019, top Dalit rights organizations have taken strong exception to, among other things, "disproportional application of death sentencing by the judiciary of minorities, such as Muslims, Dalits and Adivasis".

Ex-IAS, IPS, IFS officers tell Modi: Pragya Thakur doesn't represent India's rich heritage

Counterview Desk
In an open statement, a group of former civil servants have said that normally they would have dismissed the candidature of Pragya Thakur, who is BJP’s choice for the Bhopal Lok Sabha constituency, as an act of political expediency. However, they were forced to react to her candidature after none other than Prime Minister Narendra Modi termed has as a “symbol of our civilisational heritage.”

India's 80% construction sites "unsafe", deaths 20 times higher than those in Britain

By Rajiv Shah
The Government of India may be seeking to project India’s construction sector as the country’s second-largest employer of the country after agriculture, providing jobs to more than 44 million people, and contributing nearly 9% to the national GDP, yet, ironically, its workforce is more unprotected than any other industrial sector of the country. Data suggest that the possibility of a fatality is five times more likely in the construction industry  than in a manufacturing industry, and the risk of a major injury is 2.5 times higher.

India sans Modi preferable, Congress worthier recipient of Indians’ votes: The Economist

By Our Representative
In a strongly-worded and crucial commentary on Prime Minister Narendra Modi as the electoral political battle is on, influential British weekly “The Economist”, has declared that “Indians, who are in the midst of voting in a fresh election, would be better off with a different leader”, even as pointing out that that under Modi, “India’s ruling party poses a threat to democracy.”