Has India's battle against poverty done well in the last 5 yrs?

India has lifted 140 million people out of multi-dimensional poverty from 2015-16 to 2019-21, according to a report by the United Nations Development Programme. The report compares the above figure with a period between 2005-06 to 2015-16, when 275 million people were pulled out of poverty.

In line with this, the incidence of poverty -- the proportion of people who live in multidimensional poverty -- fell from 55.1% in 2005-16 to 16.4% in 2019-21.

What is multidimensional poverty?

The multi-dimensional poverty index takes into account a wide range of parameters spanning health, education and standard of living as against a poverty index by World Bank, which measures income level to gauge poverty levels.

Put this number on screen in form of graph

16.4% of India’s population live in poverty and about 4.2% of the population live in severe poverty. about 18.7% of people are vulnerable to poverty
 

The UNDP report noted that about 16.4% of India’s population live in poverty and about 4.2% of the population live in severe poverty, and about 18.7% of people are vulnerable to poverty. Unsurprisingly, the rural disparities are stark as 21.2% people in rural areas are poor compared with just 5.5% in urban areas.

Poverty alleviation

Interestingly, India reduced poverty at a faster pace from 2015-16 to 2019-21 at an average rate of 11.9% a year, compared with 8.1% from 2005-2006 to 2015-2016. However, when the base poverty levels are lower, the relative poverty reduction is easier to achieve.

The effects of Covid-19 pandemic on the poverty numbers cannot be assessed because nearly two-thirds of data from the 2019-2021 health survey for the country were collected before the pandemic.

Going by the World Bank’s measure of poverty by income, about 56 million Indians may have plunged into extreme poverty in 2020 as a result of the pandemic. The World Bank estimated extreme poverty based on a purchasing power parity (PPP) of $2.15.

Despite this, the UN report said the results are striking, showing a significant reduction in all 10 multidimensional poverty index deprivations among poor people. For instance, in health, the proportion of people who are deprived from nutrition fell from 44.3% in 2005-06 to 21.1% in 2015-16 to 11.8% in 2019-21.

Similarly, in education, people who are deprived of certain years of schooling dropped from 11.6% in 2015-16 to 7.7% in 2019-21.

Experts say it all depends on how you define multidimensional poverty to get a sense of whether India has fared better in the last few years.
 

Quality of education

For instance, even though the number of certain years completed in school by children has improved over the years as seen in the UNDP report, the quality of education still lags.

According to a National Achievement Survey (NAS) of 2021, there is an average learning level of 59% in grade 3, 42% in grade 8 and 36% in grade 10. This indicates a decline in learning levels with an increase in grade level.

Further, the Covid-led schools closure must have worsened learning across the education system, along with erosion in gains in enrolment and school completion. According to the World Bank, five months of school closures due to Covid would result in an immediate loss of 0.6 years of schooling adjusted for quality, bringing the effective learning that a student can achieve down from 7.9 years to 7.3 years.

Children’s health

Similarly, despite an improvement in child mortality from 2005, child stunting and wasting is still worse in India.

According to the National Family Health Survey of 2019-21, the child wasting rate of children worsened from 15% in 2012-16 period to 19.3% in 2019-2021 and it is one of the highest in the world.

Stunting is when a child’s height is lower for the appropriate age and wasting is when a child’s weight is too low for the height. Let us hear more from NC Saxena, former secretary at planning commission.

NC Saxena, former Secretary, Planning Commission believes India has done well in physical infra, sanitation and electricity penetration. But India has not performed well in nutrition with regards to calorie intake and malnutrition. Experts also say India has done well over the past few years in physical infrastructure indicators captured in a UN report. Deprivations in sanitation, cooking fuel and housing fell the most from 2015-2016 to 2019-2021.

Speaking to Business Standard, DK Srivatsava, Chief Policy Advisor, EY India says, India has done tangibly better in recent years due to targeted policy orientation. On health and education, much ground is still to be covered, he says. 

Despite progress on some multi-dimensional poverty indicators in recent years, India still has by far the largest number of poor people at 228 million. The impact of Covid might have only worsened the scenario and policymakers have their task cut out in eliminating poverty as a whole.