News / Economy

India Records Sharp Drop in Poverty Rate

A boy sells roses while standing on a road divider during in Mumbai in this July 12, 2013, file photo.A boy sells roses while standing on a road divider during in Mumbai in this July 12, 2013, file photo.
x
A boy sells roses while standing on a road divider during in Mumbai in this July 12, 2013, file photo.
A boy sells roses while standing on a road divider during in Mumbai in this July 12, 2013, file photo.
Anjana Pasricha
In India, the government says the percentage of poor people has dropped sharply following strong economic growth during the last seven years. While critics acknowledge that the poverty rate has declined at a rapid pace, they say the Indian government's definition of poverty results in the undercounting of the number of poor.
 
Thirty-five-year-old Jay Prakash Mahato begins his day at 5 am cleaning cars in the business hub of Gurgaon. He then goes to work in a factory making crockery. In the evening he cooks for a family. The two part time jobs along with his regular job help him earn about $200 a month.
 
Mahato says his economic status has improved hugely since he migrated from a village in Bihar more than a decade ago.
 
Mahato says when he came to Gurgaon the wages were very low - about $40. He lived a hand-to-mouth existence. Now he is able to comfortably feed and clothe his four children.
 
Economists link Mahato’s rising income to a decade in which India’s economy grew by almost eight percent annually. Wages improved and people like Mahato got more opportunities, whether at regular jobs or part time ones.
 
The government this week announced that the number of poor people dropped from more than 400 million in 2005 to 270 million by 2012. That’s a drop from 37 percent to 22 percent of the population - or roughly two percent every year. 
 
Numbers debatable

Economists say the actual number of poor people is debatable because the government counts only those who spend less than 55 cents a day in urban areas and about 45 cents in rural areas as poor. The international poverty standard is less than $1.25 per day. By that mark, in 2010, the World Bank estimated nearly 33 percent of Indians were living in poverty.
 
Jay Prakash Mahato is seen cleaning a car as part of his three jobs, in New Delhi's business district of Gurgaon (Anjana Pasricha/VOA).Jay Prakash Mahato is seen cleaning a car as part of his three jobs, in New Delhi's business district of Gurgaon (Anjana Pasricha/VOA).
x
Jay Prakash Mahato is seen cleaning a car as part of his three jobs, in New Delhi's business district of Gurgaon (Anjana Pasricha/VOA).
Jay Prakash Mahato is seen cleaning a car as part of his three jobs, in New Delhi's business district of Gurgaon (Anjana Pasricha/VOA).
Economist Y.K. Alagh in Gujarat says that the exact proportion of poor in the country of 1.2 billion may be questioned. But he says the trend is clear - there is evidence to show that poverty has declined at a more rapid pace in the past decade. 
 
“One, it was a period of high growth. Second, it was a period of high agricultural growth. Employment has also improved.  Agricultural growth and employment are very important determinants of poverty. So in that sense it is plausible, that poverty has fallen in India. What is the level, well…,” . said Alagh.
 
The decline has been steeper in the country’s vast rural areas where two thirds of the population lives. Some of the country’s poorest states such as Orissa, Bihar and Rajasthan have also shown sharper drops in poverty levels than more prosperous regions.
 
However, rural areas are still home to the bulk of the poor - three out of every four live in the countryside. 
 
Job creation challenge

The head of the Indira Gandhi Institute for Development Research in Mumbai, Mahendra Dev, says that makes it critical to focus on creating more jobs outside of the farming sector.
 
“There is a need to shift them to non-farm employment, [the] basic thing is we need more productive employment. India missed [opportunities in the] labor intensive manufacturing sector. You cannot do it overnight, but medium term we have to go to [the] manufacturing sector,” said Dev.
 
Mahato, who migrated from Bihar, one of India’s poorest states, agrees.
 
He says his condition was bad in the village. There were no jobs and no money, and the only sustenance was a few fields which they cultivated. 
 
The political opposition has slammed the government for the latest poverty numbers saying they have been calculated by lowering the bar to measure poverty. 
 
Economist Alagh says India’s record on fighting poverty has been a mixed bag.
 
“Grain consumption has gone up. Nutrition levels have improved, but for women, the girl child and in some regions, chronic malnutrition is still very high. Obviously those are the glaring failures. A lot more could have been done, more focused programs, better evaluation, more effective local institutions,” said Alagh. 
 
The government has promised new norms to identify the poor and more programs to fight high levels of malnutrition in the country. Among them is an ambitious food program to provide highly subsidized food grains to nearly two thirds of the population. Opposition parties, however, are questioning the government for trying to push through this program if it claims only one in every five persons is poor.

You May Like

Multimedia US Nurse ‘Cured of Ebola,’ NIH Says

Nina Pham, Texas nurse who treated first Ebola patient in US, received no experimental drugs; WHO expects vaccine surge in 2015 More

Video Islamic State Militants Encroach on Baghdad

Iraqi capital not under ‘imminent threat,’ US military says, amid worries about foothold More

Video Hong Kong Protesters Focus on Holding Volatile Mong Kok

Activists say holding Mong Kok is key to their movement's success, despite confrontations with angry residents and police More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
After Decades of Pressure, Luxembourg Drops Bank Secrecy Rulesi
X
October 21, 2014 12:20 AM
European Union finance ministers have reached a breakthrough agreement that will make it more difficult for tax cheats to hide their money. The new legislation, which had been blocked for years by countries with a reputation as tax havens, was approved last week after Luxembourg and Austria agreed to lift their vetoes. But as Mil Arcega reports, it doesn’t mean tax cheats have run out of places to keep their money hidden.
Video

Video After Decades of Pressure, Luxembourg Drops Bank Secrecy Rules

European Union finance ministers have reached a breakthrough agreement that will make it more difficult for tax cheats to hide their money. The new legislation, which had been blocked for years by countries with a reputation as tax havens, was approved last week after Luxembourg and Austria agreed to lift their vetoes. But as Mil Arcega reports, it doesn’t mean tax cheats have run out of places to keep their money hidden.
Video

Video Kobani Refugees Welcome, Turkey Criticizes, US Airdrop

Residents of Kobani in northern Syria have welcomed the airdrop of weapons, ammunition and medicine to Kurdish militia who are resisting the seizure of their city by Islamic State militants. The Turkish government, however, has criticized the operation. VOA’s Scott Bobb reports from southeastern Turkey, across the border from Kobani.
Video

Video China Political Meeting Seeks to Improve Rule of Law

China’s communist leaders will host a top level political meeting this week, called the Fourth Plenum, and for the first time in the party’s history, rule of law will be a key item on the agenda. Analysts and Chinese media reports say the meetings could see the approval of long-awaited measures aimed at giving courts more independence and include steps to enhance an already aggressive and high-reaching anti-corruption drive. VOA’s Bill Ide has more from Beijing.
Video

Video US ‘Death Cafes’ Put Focus on the Finale

In contemporary America, death usually is a topic to be avoided. But the growing “death café” movement encourages people to discuss their fears and desires about their final moments. VOA’s Jerome Socolovsky reports.
Video

Video Ebola Orphanage Opens in Sierra Leone

Sierra Leone's first Ebola orphanage has opened in the Kailahun district. Hundreds of children orphaned since the beginning of the Ebola outbreak face stigma and rejection with nobody to care for them. Adam Bailes reports for VOA about a new interim care center that's aimed at helping the growing number of children affected by Ebola.
Video

Video Young Nairobi Tech Innovator on 'Track' in Security Business

A 24-year-old technology innovator in Nairobi has invented a tracking device that monitors and secures cars. He has also come up with what he claims is the most robust audio-visual surveillance system yet. As Lenny Ruvaga reports from the Kenyan capital, his innovations are offering alternative security solutions.
Video

Video Latinas Converting to Islam for Identity, Structure

Latinos are one of the fastest growing groups in the Muslim religion. According to the Pew Research Center, about 6 percent of American Muslims are Latino. And a little more than half of new converts are female. VOA’s Carolyn Presutti travelled to Miami, Florida -- where two out of every three residents is Hispanic -- to learn more.
Video

Video Exclusive: American Joins Kurds' Anti-IS Fight

The United States and other Western nations have expressed alarm about their citizens joining Islamic State forces in Syria and Iraq. In a rare counterpoint to the phenomenon, an American has taken up arms with the militants' Syrian Kurdish opponents. Elizabeth Arrott has more in this exclusive profile by VOA Kurdish reporter Zana Omer in Ras al Ayn, Syria.
Video

Video South Korea Confronts Violence Within Military Ranks

Every able-bodied South Korean male between 18 and 35 must serve for 21 to 36 months in the country’s armed forces, depending upon the specific branch. For many, service is a rite of passage to manhood. But there are growing concerns that bullying and violence come along with the tradition. Reporter Jason Strother has more from Seoul.
Video

Video North Carolina Emerges as Key Election Battleground

U.S. congressional midterm elections will be held on November 4th and most political analysts give Republicans an excellent chance to win a majority in the U.S. Senate, which Democrats now control. So what are the issues driving voters in this congressional election year? VOA National Correspondent Jim Malone traveled to North Carolina, one of the most politically competitive states in the country, to find out.
Video

Video Comanche People Maintain Pride in Their Heritage

The Comanche (Indian nation) once were called the “Lords of the Plains,” with an empire that included half the land area of current day Texas, large parts of Oklahoma, New Mexico, Kansas and Colorado.The fierceness and battle prowess of these warriors on horseback delayed the settlement of most of West Texas for four decades. VOA’s Greg Flakus reports from Lawton, Oklahoma, that while their warrior days are over, the 15,000 members of the Comanche Nation remain a proud people.
Video

Video Turkey Campus Attacks Raise Islamic Radicalization Fears

Concerns are growing in Turkey of Islamic radicalization at some universities, after clashes between supporters of the jihadist group Islamic State (IS) or ISIS, and those opposed to the extremists. Pro-jihadist literature is on sale openly on the streets of Istanbul. Critics accuse the government of turning a blind eye to radicalism at home, while Kurds accuse the president of supporting IS - a charge strongly denied. Henry Ridgwell reports from London.

All About America

AppleAndroid

World Currencies

EUR
USD
0.7893
JPY
USD
107.68
GBP
USD
0.6238
CAD
USD
1.1214
INR
USD
61.185

Rates may not be current.