The UPA government?s focus on food security and other social welfare schemes has once again revived the debate about poverty levels in the country. The big difference this time around is that any Indian snapshot of poverty is complicated by the appearance of at least four widely different poverty estimates brought out by both government and quasi-government agencies. Since poverty numbers have a significant impact on the need for redistributive efforts and since such efforts translate into a large demand on the limited financial resources of the government, it is best that this debate is settled at the earliest. The issue first came into focus when the Arjun Sengupta (the chairman of the National Commission for Enterprises in the Unorganised Sector in 2007) report on the conditions of work in the unorganised sector estimated that 836 million people who account for 77% of the population with an income of $2 in PPP terms could be considered as poor and vulnerable. This estimate of the size of the vulnerable segment was based on various official survey reports on consumption and employment levels in the first half of the decade. But it was in sharp contrast to the official poverty figures brought out by the Planning Commission that estimated the number of poor at 302 million or 27.5% of the population based on the 2004-05 consumption figures. Then, in September last year, the report of the expert group on the methodology of the BPL census in 2009 came up with the demand that the percentage of the poor rural population entitled to BPL status should be drastically revised upward to at least 50%. This estimate was supposedly in sync with data indicating that 50-75% of the children and women are either underweight or anaemic in rural India.
Attempting to resolve the methodology conundrum of poverty estimates, an expert group set up by the Planning Commission came up with yet another set of poverty figures in November 2009. This estimate was based on a new reference basket and new price indices. It found the share of poor in 2004-05 to be 37.2%. These are all poverty numbers thrown up at the level of the central government. State governments have a vested interest in showing higher poverty numbers to gain access to more largesse from the Centre. There is an urgent need to get a realistic assessment of the exact number of very vulnerable people who genuinely need government aid. Perhaps the census data will shed new light on the poverty numbers debate. It would be reasonable to guess though that poverty will likely have fallen quite sharply through a decade of high growth and redistribution programmes (NREG, loan waiver), than some poverty ayatollahs would like to admit.
