GLOBAL MULTIDIMENSIONAL POVERTY INDEX

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• According to the Global Multidimensional Poverty Index (MPI), Poverty in India during the 15 years between 2005-06 and 2019-21 declined by nearly 41.5 crores.

 

Details

• The Global Multidimensional Poverty Index (MPI) was released by the United Nations Development Programme (UNDP) and the Oxford Poverty and Human Development Initiative (OPHI).
  • The report highlighted that the poverty rate in India declined from 55.1% in 2005-06 to 16.4% in 2019-21.
• MPI Improvement for India has resulted in a reduction in poverty in South Asia.
• The highest number of poor people was recorded in Sub-Saharan Africa.
• The report doesn’t fully consider the effects of the COVID-19 pandemic on poverty in India.
  • For MPI, Nearly 71% of the data taken from the National Family Health Survey-5 (2019- 2021) were collected before the pandemic.
• The global MPI makes a deprivation profile of each household and person based on 10 indicators ranging from Health, Education and Standard of living.
  • All indicators are equally weighted within each dimension.
  • The global MPI identifies people as multidimensionally poor if their deprivation score is 1/3 or higher.
• Bihar, the poorest State in 2015-2016, saw the quickest reduction in MPI value.
  • Poverty fell from 77.4% in 2005-2006 to 34.7% in 2019-2021.
• According to the report, India still has the largest number of poor people worldwide at 22.8 crores, followed by Nigeria at 9.6 crores.

 

Reasons behind Poverty in India

• Illiteracy and lack of quality education: Despite more than 15 million graduates being produced every year, there are no jobs available for them due to the lack of quality education. Most of these graduates are studying outdated educational syllabi and hence cannot be productively employed anywhere.
• A vicious trap of poverty: Prevalence of massive malnourishment, stunting and wasting amongst children which negatively impact their physical and mental potential pushing them deeper into the vicious trap of poverty for the rest of their lives.
• Sub-standard health outcomes: More than 60% of the household incomes in many families are devoted towards health expenditure. This out-of-pocket expenditure on healthcare is one of the biggest pull factors for poverty.
• Administrative Bottleneck: Certain government policies favour one sector over the other. Also, there is a lack of rule of law and enforcement of laws such as the Minimum Wages Act.
• Income Inequality: According to Oxfam, the top 10% of the Indian population holds 77% of the total national wealth. 73% of the wealth generated in 2017 went to the richest 1%, while 67 million Indians who comprise the poorest half of the population saw only a 1% increase in their wealth.
• Discrimination: Discrimination and poverty go hand in hand. Discrimination can both cause poverty and be a hurdle in alleviating poverty. Ex: Discrimination against women, SC, ST, Disabled, Old age people etc is one of the major causes of poverty among them.
• Nature of job: Approximately 56% of the total working population is in the agricultural sector. Which is marked by poor landholding, low productivity and disguised unemployment.
• The issue of low employment growth within industrial and service sectors has contributed to stagnant or declining standards of living.
• Inadequate public infrastructure: Lack of accessibility to primary health care centres, quality public schools, research institutions, roads, waterways, rural markets, etc. act complementary for the rise and sustenance of poverty in India.
• Poor policy structure: Given the vicious cycle of poverty, government hand-holding is needed to support those above the poverty lines to prevent them from slipping below the line.

 

Consequences of Poverty

The high infant mortality

• 4 million children die each year in India before their fifth birthday.
• In addition to Nigeria, Pakistan, the Democratic Republic of the Congo and China, India is one of the countries with the highest child mortality rates.
• Pneumonia, malaria and diarrheal diseases as well as chronic malnutrition are the most frequent causes of death.

 

Malnutrition - not even a bowl of rice a day

• India is one of the world’s top countries when it comes to malnutrition: More than 200 million people don’t have sufficient access to food, including 61 million children. 7.8 million infants were found to have a birth weight of fewer than 2.5 kilograms - alarming figures for a country commonly referred to as an emerging market.

 

Child labour - no time to play and learn

• Although child labour for children under the age of 14 in India is prohibited by law, according to o cial figures, 12.5 million children between the ages of 5 and 14 are working.
• Aid agencies assume that in reality, there are many more estimating that 65 million children between 6 and 14 years do not go to school.
• Instead, to secure survival, it is believed that Indian children contribute to the livelihood of their families; they work in the field, in factories, in quarries, in private households and in prostitution.

Lack of education - no opportunities without education

• According to UNICEF, about 25% of children in India have no access to education.
• The number of children excluded from school is higher among girls than boys. Although women and men are treated equally under Indian law, girls and women, especially in the lower social caste, are considered inferior and are oppressed by their fathers, brothers and husbands.
• Without education, the chance of finding a living wage from employment in India is virtually hopeless.

 

Child marriage - the early end of childhood

• According to an investigation by the medical journal The Lancet, 44.5% of girls are still married in India before they are of legal age.
• Due to poverty, many parents encourage early marriages for their daughters in hopes of better lives for them.

 

Effects on Society

• The occurrence of violence and crime is geographically coincident. Due to unemployment and marginalization, poor people often indulge in wrong practices such as prostitution, theft, and criminal activities to earn money.
• Coupled with a lack of education and a properly formed moral conscience, a poverty-ridden society is more affected by violence by its people against its people from a sense of deep-seated discontent and rage.
• Homelessness affects child health, women's safety and an overall increase in criminal tendencies. Lack of money is a major cause of stress among the middle class and the poor and leads to a decline in the productivity of individuals.
• Large families fail to meet the monetary needs of the members and children as young as 5 years are made to start earning to contribute to the family income.
• Terrorist organizations offer poverty-ridden families money in exchange for a member’s participation in their activities which induces a sense of accomplishment among the youth.

 

Effect on Economy

• Poverty is a direct index indicating the success of the economy of the country. The number of people living under the poverty threshold indicates whether the economy is powerful enough to generate adequate jobs and comforts for its people. Schemes providing subsidies for the poor of the country again impose a drain on the economy.

 

Way Forward

The growth of the population at the current rate should be checked by the implementation of policies and awareness promoting birth control.

• All efforts should be made to increase employment opportunities in the country, either by inviting more foreign investments or by encouraging self-employment schemes.
• Measures should be taken to bridge the immense gap that remains in the distribution of wealth among different levels of society. A 99% one-off windfall tax on the wealth gains of the 10 wealthiest men in Covid19 alone will generate $ 812 billion.
• Certain Indian states are more poverty stricken than others like Odhisha and the North East states. Government should seek to encourage investment in these states by offering special concessions on taxes.
• The primary needs of people for attaining a satisfactory quality of life like food items, and clean drinking water should be available more readily.
• Improvement of the Subsidy rates on commodities and the Public Distribution system should be made.
• Free high school education and an increased number of functioning health centres should be provided by the government.
• At the household level, subsidized food grains have enabled people to meet food requirements but there is no certainty of income, particularly during the pandemic time. But Poverty is not just a measure of hunger. There is a need for Universal Income Support. Economic Survey 2016-17has suggested replacing all current cash transfers with universal basic income. The survey wants UBI to replace and not supplement the existing social welfare, and anti-poverty schemes like MGNREGA, PMJSY etc.
• Investments in human capital and public goods have significant positive impacts on private-sector productivity, with estimated rates of return ranging from 15% to upwards of 45 %. The enhanced productivity of human beings or human capital contributes substantially not only towards increasing labour productivity but also stimulates innovations and creates the ability to absorb new technologies.

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