Posted at 11:31 AM ET, 03/20/2012

Is India misrepresenting its poverty numbers?

India’s poverty figures fluctuate wildly, anywhere from 300 million people to 800 million people, depending on whom you ask.

A young Indian ragpicker walks past storks at a landfill in Guwahati, in India's north-eastern state of Assam. (BIJU BORO - AFP/GETTY IMAGES)
India’s Planning Commission says the number of poor people has dropped by 51 million — more than the entire population of Spain or Argentina — in the past five years. This, officials say, is the sharpest drop in poverty rate in India — from 406 million to 356 million, out of 1.2 billion Indians — since the country introduced an ambitious economic reforms program in 1991 that brought unprecedented economic growth and wealth. Poverty in rural India declined at an even faster pace, the report said.

But many Indians are not ready to believe this rare good news. Some accuse the government of statistical jugglery — first, lowering the definition of the poverty line, so as to include fewer people, and then claiming that the number of Indians living in poverty has declined.

According to the commission, Indians are defined as poor if they spend the equivalent of 56 cents or less daily in urban areas and 44 cents or less in villages. This is lower than the earlier level of 65 to 75 cents a day or less in cities, and 50 to 55 cents daily or less in villages, which was set by the commission.

“Is this the poverty line or the starvation line?” S. S. Ahluwalia, a lawmaker with the opposition Bharatiya Janata Party, asked in parliament on Tuesday, accusing the government of playing with lives of the poor.

“India’s poverty line is the most austerely defined line in the whole world,” said M. S. Swaminathan, an agricultural economist. “It is lower than other emerging economies.”

The government’s data triggered fear among many activists that fewer people will benefit from the government’s proposed free food program for the poor.

But Planning Commission chairman Montek Singh Ahluwalia, an ardent advocate of free market policies, dismissed such fears on Tuesday.

“The focus of this exercise is to determine whether inclusive growth is working,”said Ahluwalia. “It is not to determine who will get food entitlements.”

One official at the commission said welfare programs like the rural public works guarantee scheme launched by Prime Minister Manmohan Singh’s government has reduced destitute poverty in the past five years,

But in India’s poorer, populous northern states of Uttar Pradesh and Bihar, the poverty decline has only been marginal, and the absolute number of poor has risen.

By  |  11:31 AM ET, 03/20/2012

Tags:  World, India, poverty line

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