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 Obama, Modi Break Nuclear Deal Deadlock

Impasse over liability issues had been stalling bilateral civilian nuclear cooperation; deal reached at start of US president's three-day visit to India More

WHO's Late Efforts in Tackling Ebola Highlight Need for Reform

Health experts debate measures to reform agency’s response to global public health emergencies in special one-day session on deadly outbreak More

One Tumultuous Year in Power for CAR's President

As sectarian violence raged across Central African Republic, interim President Catherine Samba-Panza has Herculean task: to end civil war and put country back on right track More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Worldwide Photo Workshops Empower Youthi
X
Julie Taboh
January 23, 2015 11:08 PM
Last September, 20 young adults from South Sudan took part in a National Geographic Photo Camp. They are among hundreds of students from around the world who have learned how to use a camera to tell the stories of the people in their communities through the powerful medium of photography. Three camp participants talked about their experiences recently on a visit to Washington. VOA’s Julie Taboh reports.
Video

Video Worldwide Photo Workshops Empower Youth

Last September, 20 young adults from South Sudan took part in a National Geographic Photo Camp. They are among hundreds of students from around the world who have learned how to use a camera to tell the stories of the people in their communities through the powerful medium of photography. Three camp participants talked about their experiences recently on a visit to Washington. VOA’s Julie Taboh reports.
Video

Video US, Japan Offer Lessons as Eurozone Launches Huge Stimulus

The Euro currency has fallen sharply after the European Central Bank announced a bigger-than-expected $67 billion-a-month quantitative easing program Thursday - commonly seen as a form of printing new money. Henry Ridgwell reports for VOA from London on whether the move might rescue the eurozone economy -- and what lessons have been learned from similar programs around the world.
Video

Video Nigerian Elections Pose Concern of Potential Conflict in 'Middle Belt'

Nigeria’s north-central state of Kaduna has long been the site of fighting between Muslims and Christians as well as between people of different ethnic groups. As the February elections approach, community and religious leaders are making plans they hope will keep the streets calm after results are announced. Chris Stein reports from the state capital, Kaduna.
Video

Video As Viewership Drops, Obama Puts His Message on YouTube

Ratings reports show President Obama’s State of the Union address this week drew the lowest number of viewers for this annual speech in 15 years. White House officials anticipated this, and the president has decided to take a non-traditional approach to getting his message out. VOA White House correspondent Luis Ramirez reports.
Video

Video S. Korean Businesses Want to End Trade Restrictions With North

Business leaders in South Korea are calling for President Park Geun-hye to ease trade restrictions with North Korea that were put in place in 2010 after the sinking of a South Korean warship.Pro-business groups argue that expanding trade and investment is not only good for business, it is also good for long-term regional peace and security. VOA’s Brian Padden reports.
Video

Video US Marching Bands Grow Into a Show of Their Own

The 2014 Super Bowl halftime show was the most-watched in history - attracting an estimated 115 million viewers. That event featured pop star Bruno Mars. But the halftime show tradition started with marching bands, which still dominate the entertainment at U.S. high school and college American football games. But as Enming Liu reports in this story narrated by Adrianna Zhang, marching bands have grown into a show of their own.
Video

Video Secular, Religious Kurds Face Off in Southeast Turkey

Turkey’s predominantly Kurdish southeast has been rocked by violence between religious and secular Kurds. Dorian Jones reports on the reasons behind the stand-off from the region's main city of Diyarbakir, which suffered the bloodiest fighting.
Video

Video Kenya: Misuse of Antibiotics Leading to Resistance by Immune System

In Kenya, the rise of drug resistant bacteria could reverse the gains made by medical science over diseases that were once treatable. Kenyans could be at risk of fatalities as a result if the power in antibiotics is not preserved. Lenny Ruvaga has more on the story from Nairobi.
Video

Video Solar-Powered Plane Getting Ready to Circumnavigate Globe

Pilots of the solar plane that already set records flying without a drop of fuel are close to making their first attempt to fly the craft around the globe. They plan to do it in 25 flying days over a five month period. VOA’s George Putic reports.
Video

Video How Experts Decide Ethiopia Has the Best Coffee

Ethiopia’s coffee has been ranked as the best in the world by an international group of coffee connoisseurs. Not surprisingly, coffee is a top export for the country. But at home it is a source of pride. Marthe van der Wolf in Addis Ababa decided to find out what makes the bean and brew so special and how experts make their determinations.
Video

Video Yazidi Refugees at Center of Political Fight Between Turkey, Kurds

The treatment of thousands of Yazidis refugees who fled to Turkey to escape attacks by Islamic State militants has become the center of a dispute between the Turkish government and the country's pro-Kurdish movement. VOA's Dorian Jones reports.
Video

Video World’s Richest 1% Forecast to Own More Than Half of Global Wealth

The combined wealth of the world's richest 1 percent will overtake that of the remaining 99 percent at some point in 2016, according to the anti-poverty charity Oxfam. Campaigners are demanding that policymakers take action to address the widening gap between the ‘haves’ and the ‘have nots’, as Henry Ridgwell reports for VOA from London.

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More

All About America

AppleAndroid

World Currencies

EUR
USD
0.8930
JPY
USD
117.98
GBP
USD
0.6673
CAD
USD
1.2445
INR
USD
61.498

Rates may not be current.