Poverty ratio 32.75% in rural areas against 8.81% in urban: NITI report

What is the News?

Recently, Niti Aayog has released India’s first National MPI (multidimensional poverty index). The index is based on the findings of the fourth National Health Family Survey (2015-16).

This index calculated the poverty ratio on the basis of three dimensions of MPI– health, education, and standard of living — with each having a weighting of one-third in the index. 

What are the key findings of National MPI?

Source: Business Standard

Around 25.01% of the Indian population is multidimensionally poor.

There is a rural-urban disparity in the spread of poverty. The poverty ratio was as high as 32.75% in rural areas during 2015. On the other hand, the poverty ratio in urban areas was around 8.81% in 2015.

This means ​that around 288 million people in rural areas and close to 38 million in urban areas were poor in 2015.

This pattern was the same in states and Union Territories in varying degrees — a greater proportion of the poor in villages than in urban areas — except for Delhi, which is predominantly a city-state.

What do the earlier reports say about poverty?

Tendulkar Report: It showed the proportion of the poor in the rural population declined to 25.7% from 33.8%, while that in the urban population came down to 21.9% from 29.8% between 2009-10 and 2011-12. This method took those spending less than Rs 33 a day in urban areas and Rs 27 a day in the rural areas as poor.

Rangarajan Report: According to this report, the poor constituted 30.9% of the rural population during 2011-12, against 39.6% during 2009-10. On the other hand, the urban poverty ratio fell to 29.5% from 38.2% over this period. The report took a person spending less than Rs 47 a day in cities and below Rs 32 a day in villages as poor.

Source: This post is based on the article “Poverty ratio 32.75% in rural areas against 8.81% in urban: NITI report” published in Business Standard on 6th December 2021.