India's poverty reduction challenges

India has achieved a significant milestone in reducing the incidence of poverty, the data from the latest Global Multidimensional Poverty Index (MPI) released by the United National Development Programme (UNDP) and the Oxford Poverty and Human Development Initiative (OPHI) shows. The estimates show that about 415 million people exited multidimensional poverty in the country in roughly 15 years from 2005-06 to 2019-20. These estimates come with a rider from UNDP and OHPI that despite tremendous gains, India continues to have the largest number of poor people worldwide (228.9 million). Besides, "the most recent data for MPI were collected pre-pandemic, so the effects of COVID-19 and subsequent shocks on poverty in India cannot be assessed yet." Nevertheless, the incidence of poverty falling from 55.1 per cent in 2005-06 to 16.4 per cent in 2019-21 speaks volumes about the progress made by the country and the lessons learnt will be useful for key interventions towards achieving the Sustainable Development Goal of no poverty. The country's target is to reduce at least half the proportion of men, women and children of all ages living in multidimensional poverty by 2030. The MPI report brings out hard realities for Assam as it continues to be among the ten poorest states, and only West Bengal is the state to move out of the category. Other nine states in this category include Bihar, Jharkhand, Meghalaya, Madhya Pradesh, Uttar Pradesh, Odisha, Chhattisgarh and Rajasthan. A key finding in the report calls for urgent action by policymakers is that children are still the poorest age group, with more than one in five children being poor, compared with around one in seven adults. This translates to 97 million poor children - more than the total number of poor people in any other country covered by the global MPI, according to the report. The UNDP says that the data used to estimate the 2022 global MPI values were gathered from household surveys across 111 countries, covering 6.1 billion people and the report finds that 1.2 billion people live in acute multidimensional poverty – nearly twice the number of people when poverty is defined as living on less than 1.90 dollars per day. The UNDP claims that this year for the first time, the MPI reveals interlinkages: interlinked deprivations that affect the same person or household simultaneously in the form of deprivation bundles. With more than 850 different combinations of the 10 deprivations, this analysis can guide policymakers on specific interventions that are meaningful for individuals and families experiencing poverty, it adds. The MPI report has been released two days after the release of the Global Hunger Report 2022 released by Concern Worldwide and Welt Hunger Hilfe, Non-Government Organizations from Ireland and Germany respectively, which ranked India at 107 among 121 countries and claimed that the country slipped six places. India officially rejected the Global Hunger Report and alleged that the index is "an erroneous measure of hunger and suffers from serious methodological issues". India argues that three out of the four indicators used for the calculation of the index are related to the health of children and cannot be representative of the entire population. Besides, the fourth and most important indicator estimate of the proportion of the undernourished population in the Global Hunger Report is based on an opinion poll conducted on a very small sample size of 3000, it alleges. Key highlights of the MPI report for India are: deprivations in sanitation, cooking fuel and housing fell the most from 2015-16 to 2019-2021. The share of the population who were poor and deprived of sanitation dropped from 24.4 per cent to 11.3 per cent, and the share of the population who were poor and cooked primarily with wood, dung, charcoal or another solid fuel was nearly halved — from 26.0 per cent to 13.9 per cent and reduction in the share of the population who were poor and deprived in electricity from 8.6 per cent to 2.1 per cent. In both rural and urban areas nutritional deprivation is rampant, with around 60 per cent of people experiencing it. The MPI report, however, states that a key issue for monitoring poverty is data irregularity and more frequent data are needed to track progress, evaluate policies and ultimately get the information needed to accelerate poverty reduction. Updating poverty estimates with the post-Covid poverty data at the national and states level will be crucial for key policy and investment decisions related to integrated interventions. The Central government's decision to extend till December the additional free-of-cost rice/wheat distribution to 80 crore households under the PM Garib Kalyan Anna Yojana (PM-GKAY) also presents the realities of the rising food subsidy bill. The government has already distributed 1121 lakh MT of free foodgrains under PMGKAY equivalent to a food subsidy of Rs 3.91 lakh crore. The MPI report is a reminder of the formidable challenge of lifting every single household out of poverty in India.