POVERTY DECLINED AND INEQUALITY WIDENED IN INDIA

POVERTY DECLINED AND INEQUALITY WIDENED IN INDIA

Debesh Bhowmik

Taking 66^th NSSO survey data,Planning Commission estimated that the ratio of per capita income between top 15% and bottom 15% of the population has risen from 3.9 in 2004-05 to 5.8 in 2009-10 in rural areas but the ratio has gone up from 6.4 to 7.8 in urban areas.It showed that poverty has been the slowest in the bottom 15% of the population.The Planning Commission has said that poverty ratio for 2009-10 declined of 7.3% from 37.2% in 2004-05 to 29.8% in 2009-10,so that the number of poor  came down by 15% from 407.2million to 354.6 million  based on per capita expenditure of Rs 29 per day  for urban area and Rs 22 per day for rural area.The poverty ratio is given below,( percentage of people below the poverty line).

Year                Urban poverty             Rural Poverty  Total Poverty

1993-94           31.8                             50.1                 45.3

2004-05           25.7                             41.8                 37.1

2009-10           20.9                             33.8                 29.8

The NSSO data also showed that in rural area Gini coefficient in 2004-05 was calculated as 0.27 which increased to 0.28 in 2009-10,on the contrary, in urban areas the Gini was found as 0.35 in 2004-05 which rose to 0.37 in 2009-10,which means that both urban and rural areas inequality widened where as poverty ratio have fallen.This is self contradictory.Moreover, the richer section got top benefit from growth process of the economy.

Some comments are interesting.M.S.Aluwalia,the deputy chairman of Planning Commission said that NSSO has under estimated the consumption expenditure.The poverty estimates would not impact beneficiaries of welfare schemes. NCAER comments that poor became poorer but rich became richer.They could not say why it had happened.

They, all managed the media and forgot about their responsibilities because no inter relationship between government policy decisions and the NSSO formulation of data, as well as the estimation of Planning Commission towards the stipulated goals. More precisely, NSSO did not collect poverty data in all the years. Even, the organization could not collect macro economic data every year. Therefore, we have a lack of time series data on poverty, unemployment and so on. I think , there is no continuous process on the collection and estimation of data on Indian Economy.Experts come and exit and advice on the estimates only.

Lastly, I would say that poverty and inequality should move in the same direction, otherwise it is unhealthy.