Poverty Redefined: Rangrajan Committee Submits Its Report

Poverty Redefined: Rangrajan Committee Submits Its Report

A new definition of poverty has been coined by the Rangrajan committee. As per its report, a person spending more than Rs.47 in the urban area and Rs. 32 in rural areas per day is not considered as poor. Senior economist and former RBI Governor C. Rangrajan has led the committee which has authored the report.

The committee has not seen eye-to-eye with the Tendulkar committee. The Tendulkar committee report on the estimation of poverty has been dismissed by the Rangrajan committee. The Rangrajan committee has indicated that the number of poor in India were much higher in 2011-2012 at 29.5% of the population.

The report has reached Indrajit Singh, the Minister of State for Planning. As per the report, 3 of every 10 persons in India are poor. The Planning Commission's estimates are based on the Tendulkar Committee which has drawn flak for terming those who earn more than Rs. 33 in urban areas and Rs. 27 in rural areas as not poor.

The Rangrajan Committee was set up in 2013 to review the Tendulkar Committee methodology for the estimation of poverty. An effort was also made to clear the ambiguity for the number of poor people in the country. An earlier methodology devised by Tendulkar has estimated the poverty line to be at Rs. 816 and Rs.1,000 respectively based on NSSO data for 2011-2012. Both the Rangrajan and Tendulkar Committees have based the report on the data from the National Sample Survey Office.

Poverty in India has been defined on the basis of calorific consumption required for the survival of the individual apart from other basic costs such as health-care and education. The calorific consumption of the poverty line is fixed currently at 2400 calories per person in rural parts of the country and 2100 in urban locations.

In 2011-2012, 3 out of 10 people were poor whereas 4 out of 10 were poor in 2009-2010, according to the report of the Rangrajan Committee. The number of poor people have therefore risen by 9.4 crore in a single year.

The Rangrajan Committee has also estimated that 363 million people or 29.5% of the 1.2 billion people living in India are currently poor. This is a much higher figure than the 269 million previously indicated that the difference of 94 million can be attributed to change in the manner through which the poverty line is defined.

The estimates were submitted to the NDA government recently and it is not yet established whether these will be considered the new official estimates of poverty. No matter what the number of poor are officially pegged at, poverty has and is a serious problem facing India. With anti-poverty schemes and initiatives, much can be done to reduce the number of poor living in our country. Formulating anti-poverty policies and implementing them well is the important step which needs to be taken in this direction.