Title : MULTIDIMENSIONAL POVERTY INDEX

Date : Nov 27, 2021

Description :

Based on a News Article published in the ‘The Hindu’ on 27^th November 2021 on Page Number 11

 

Useful for UPSC CSE Prelims and Mains (GS Paper I & II)

 

 

 

 

Background:

 

• The United Nations Development Programme (UNDP) and the Oxford Poverty & Human Development Initiative released the Global Multidimensional Poverty Index 2021 in October 2021. (OPHI).
• The Index takes into account statistics from 109 nations with a population of 5.9 billion people.

 

Important Points:

 

• Data from around the world shows that 1.3 billion people are multidimensionally impoverished.
• Children under the age of 18 account for roughly half of the population (644 million).
• Sub-Saharan Africa (556 million) and South Asia account for over 85% of the population (532 million).
• More over 67 percent of the world's population lives in middle-income countries.

 

 

Periodic Poverty Reduction:

• Of the 80 nations and five billion people for whom data is available across time, 70 have reduced MPI in at least one period, with Sierra Leone (2013-2017) leading the way, followed by Togo (2013/2014-2017).

 

Absolute Poverty Reduction:

• Some countries had the fastest absolute poverty reductions in their poorest regions, assisting them in meeting their commitment to leave no one behind.
• North Central Liberia (2013–2019/2020) and Province 2 Nepal (2016–2019) are two of these places.

 

Poverty Among Ethnic and Racial Groupings:

• Disparities in multidimensional poverty among ethnic and racial groups are sometimes bigger than those between geographical subnational regions.
• Multidimensional poverty among different ethnic groups can vary greatly within a country.
• As a result, many policy interventions are required to alleviate multidimensional poverty.

 

Education:

• Approximately two-thirds of the world's multidimensionally poor (836 million) live in households where no woman or girl has finished at least six years of education.
• India has a population of 227 million people.
• In households with at least one boy or man who has finished six or more years of schooling but no girl or woman, one-sixth of all multidimensionally poor people (215 million) dwell.

 

Women and girls:

• Living in multidimensional poverty are also more likely to experience intimate partner violence, according to the report.
• 1 billion people are exposed to solid cooking fuels, another billion has poor sanitation, and another billion lives in unsuitable housing.
• 788 million people live in a family where at least one person is malnourished.
• Within a 30-minute round trip walk, 568 million people do not have access to improved drinking water.

 

Covid's Impact:

 

• The Covid-19 pandemic has slowed development around the planet, and we're still trying to figure out the full extent of its effects.
• It has exposed flaws in social protection systems, education, and the vulnerability of employees all across the world.
• In countries with higher degrees of multidimensional poverty, these flaws are most pronounced.

 

Scenario in India:

 

• Because castes and tribes are a more common line of social stratification in India, this index shows the prevalence and intensity of multidimensional poverty among castes and tribes, as well as among persons who do not belong to any caste or tribe.
• In India, lower tribes or castes account for five out of every six multidimensionally impoverished persons.
• 9.4 percent of Scheduled Tribes live in poverty on several levels.
• 33.3 percent of the Scheduled Caste population is impoverished on multiple levels.
• 27.2 percent of the Other Backward Class group is impoverished on multiple levels.
• In India, female-headed families account for around 12% of the population.

 

About MPI:

 

• The UNDP and the OPHI created the Multidimensional Poverty Index in 2010.
• MPI is based on the premise that poverty is multidimensional, not unidimensional (i.e., it is not just determined by income, and one person may be lacking in numerous fundamental necessities such as education, health, and so on).
• The index depicts the percentage of persons who are poor as well as the average number of deprivations that each poor person faces at any given time.

 

MPI is made up of three dimensions and ten indicators, which are as follows:

 

• Health: Child mortality and nutrition (1/6 weightage each, total 2/6)
• Standard of living: Electricity, flooring, drinking water, sanitation, cooking fuel, and assets (1/18 weightage each, total 2/6)
• Education: Years of schooling and child enrollment (1/6 weightage each, total 2/6

 

• If a person is multidimensionally impoverished, she or he is lacking in at least one-third (33%) of the weighted indicators (out of the ten indicators).
• Extreme multidimensional poverty is defined as being deficient in one half or more of the weighted indicators.
• In contrast to traditional technique, which evaluates poverty solely in terms of income or monetary terms, MPI is significant because it acknowledges poverty across multiple dimensions.

 

 

What is Poverty:

 

• Poverty is defined as a state or condition in which an individual or a group lacks the financial means and necessities for a basic level of living. Poverty is defined as a situation in which one's earnings from work are insufficient to meet fundamental human requirements.
• Poverty, according to the World Bank, is a severe lack of well-being that has various dimensions. Low earnings and the inability to obtain the essential commodities and services required for a dignified existence are examples. Poverty also includes poor health and education, a lack of access to safe drinking water and sanitation, a lack of physical security, a lack of voice, and a lack of capacity and chance to improve one's life.
• In 2011, 21.9 percent of India's population was living below the national poverty threshold.
• In 2018, about 8% of the world's workers and their families were living on less than $1.90 per day (international poverty line).

 

 

 

Poverty Estimation in India:

 

• Poverty estimation in India is done by the NITI Aayog task force using data from the National Sample Survey Office under the Ministry of Statistics and Programme Implementation to calculate a poverty line (MOSPI).
• In India, poverty lines are calculated primarily on consumption expenditure rather than income levels.
• Consumer expenditure surveys conducted by the National Sample Survey Organization are used to determine poverty. A poor household is defined as one that spends less than a certain amount each month.
• The poverty ratio, which is the ratio of the number of poor to the total population stated as a percentage, is used to determine the prevalence of poverty. It's also referred to as the head-count ratio.
• The Alagh Committee (1979) established a poverty level based on an adult's daily calorie requirement of 2400 and 2100 calories, respectively, in rural and urban areas.
• Following that, the poverty estimation was done by other committees, including the Lakdawala Committee (1993), Tendulkar Committee (2009), and Rangarajan Committee (2012).
• According to the Rangarajan committee report (2014), the poverty line is set at Rs. 1407 per capita in urban areas and Rs. 972 in rural regions.

 

Factors enhancing Poverty in India:

 

• Population Growth: India's population has risen steadily over the years. It has risen at a pace of 2.2 percent per year for the past 45 years, implying that around 17 million people are added to the country's population each year. This has a significant impact on the demand for consumer products.
• Agricultural Productivity is Low: The low productivity of the agricultural sector is a key cause of poverty. Low productivity can be caused by a variety of factors. It is primarily due to fragmented and subdivided land holdings, a lack of cash, illiteracy about modern farming technologies, the use of conventional farming practises, wastage during storage, and other factors.
• Inefficient Resource Utilization: The country suffers from underemployment and hidden unemployment, notably in the agricultural sector. Low agricultural output and a drop in living standards have resulted as a result of this.
• Economic Progress at a Slow Pace: India's economic development has been slow, particularly in the first 40 years of independence before the LPG reforms in 1991.
• Price Increases: The country's price increases have been consistent, adding to the burden carried by the poor. Although a few people have profited, the lower income groups have suffered as a result, and are unable to meet even their most basic needs.
• Unemployment is another element that contributes to poverty in India. As the world's population grows, so does the number of people looking for work. However, the expansion of opportunities is insufficient to meet the demand for jobs.
• Lack of Capital and Entrepreneurship: In the absence of capital and entrepreneurship, the economy suffers from a lack of investment and employment creation.
• Social Issues: In addition to economic factors, social factors obstruct India's poverty eradication efforts. The laws of inheritance, the caste system, and certain customs, to name a few, are all obstacles in this regard.
• Colonial Exploitation: For nearly two centuries, the British colonisation and authority over India de-industrialized the country by destroying its traditional handicrafts and textile industries. Colonial policies reduced India to a mere producer of raw materials for European industry. Climatic Factors: The majority of India's impoverished live in the states of Bihar, Uttar Pradesh, MP, Chhattisgarh, Odisha, Jharkhand, and others. Natural catastrophes like as floods, disasters, earthquakes, and cyclones frequently strike these states, wreaking havoc on agriculture.

 

India's Poverty Alleviation Programs:

 

• IRDP (Integrated Rural Development Program): It was first implemented in 1978-79 and became universal on October 2, 1980, with the goal of providing help to the rural poor in the form of a subsidy and bank credit for productive work possibilities throughout several plan periods.
• Jawahar Gram Samridhi Yojana/Jawahar Rozgar Yojana: The JRY was created with the goal of creating real work possibilities for the unemployed and underemployed in rural areas by building economic infrastructure and community and social assets.
• Rural Housing – Indira Awaas Yojana: The Indira Awaas Yojana (LAY) initiative intends to provide free housing to BPL families in rural regions, with SC/ST households being the primary objective.
• The Food for Work Program aims to improve food security by providing pay jobs. Food grains are provided free of charge to states, however deliveries from the Food Corporation of India (FCI) godowns have been delayed.
• The National Old Age Pension Scheme (NOAPS) is a government-sponsored pension. Panchayats and municipalities are in charge of implementing the scheme in states and union territories. Depending on the state, the contribution may differ. For applicants aged 60–79, the old age pension is worth $200 per month. According to the 2011–2012 Budget, the sum for applicants over the age of 80 has been increased to $500 per month. It's a profitable business.
• The Annapurna Scheme was established by the government in 1999–2000 to offer food to older adults who are unable to care for themselves, are not covered by the National Old Age Pension Scheme (NOAPS), and have no one in their community to look after them. This programme would supply qualified senior folks with 10 kg of free food grains per month. They primarily target 'poorest of the poor' and 'indigent senior seniors' groups.
• SGRY (Sampoorna Gramin Rozgar Yojana): The scheme's core goals are the creation of wage jobs, the development of long-term economic infrastructure in rural areas, and the supply of food and nutrition security for the poor.
• MGNREGA (National Rural Employment Guarantee Act) of 2005: Every rural household receives 100 days of guaranteed employment each year as a result of the Act. Women would be eligible for one-third of the proposed jobs. National Employment Guarantee Funds will also be established by the federal government. State governments will also establish State Employment Guarantee Funds to carry out the scheme. If an applicant is not hired within 15 days, he or she will be eligible for a daily unemployment stipend under the programme.
• Aajeevika (2011): National Rural Livelihood Mission: It arose from the necessity to diversify the demands of the rural poor by providing them with occupations that pay a monthly salary. To assist the poor, self-help groups are organised at the village level.
• National Urban Livelihood Mission: The NULM focuses on organizing urban poor in Self Help Groups, creating opportunities for skill development leading to market-based employment and helping them to set up self-employment ventures by ensuring easy access to credit.
• Kaushal, Pradhan Mantri Vikas Yojana: It will focus on new entrants to the labour market, particularly those who have dropped out of classes X and XII.
• Jan Dhan Yojana of Pradhan Mantri: It planned to distribute subsidy, pension, and insurance benefits directly to beneficiaries, and it met its goal of opening 1.5 million bank accounts. The scheme is aimed mostly at the unbanked poor.

Tags : Jan Dhan Yojana, MPI, Bihar