About 24.82 crore people escaping multidimensional poverty with a fall in headcount ratio by 17.89 percentage points will also help in accelerating the achievement of Sustainable Development Goals.
Indian Prime Minister Narendra Modi on Monday reiterated the government’s commitment to continue to work towards all-round development and to ensure a prosperous future for every Indian.
He was commenting on a Discussion Paper released by NITI Aayog today on Multidimensional Poverty. The paper says that since 2005-06, India has registered a significant decline in the Multidimensional Poverty Index (MPI) from 29.17 per cent in 2013-14 to 11.28 per cent in 2022-23 — which is a reduction of 17.89 per cent. As a result 24.82 crore people escaped multidimensional poverty in last 9 years.
PM Modi posted on X :
“Very encouraging, reflecting our commitment towards furthering inclusive growth and focussing on transformative changes to our economy. We will continue to work towards all-round development and to ensure a prosperous future for every Indian.”
The National Multidimensional Poverty Index by NITI Aayog uses the internationally acclaimed Alkire Foster methodology with a difference that National MPI covers 12 indicators while global MPI covers 10 indicators. This analysis attempts to study the decline in poverty rates and number of multidimensionally poor people across various time periods. The recent report on National MPI was based on National Family Health Surveys 4 (2015-16) and 5 (2019-21). Owing to lack of data for the years between 2005-06 and 2015-16 and after 2019-21 concerning the incidence of poverty levels, headcount poverty ratios for 2013-14 and 2022-23 have been estimated based on compound growth rate of the reduction in the incidence of poverty levels between 2005-06 and 2015-16 and 2015-16 and 2019-21 respectively.
The latest NITI Aayog publication, ‘Multidimensional Poverty In India Since 2005-06 – A Discussion Paper,’ says, “Multidimensional poverty in India was found to decline from 29.17 per cent in 2013-14 to 11.28 per cent in 2022-23 with about 24.82 crore people escaping poverty during this period.”
At the States’ level, Uttar Pradesh topped the list with 5.94 crore people escaping poverty followed by Bihar at 3.77 crore and Madhya Pradesh at 2.30 crore. All 12 indicators of MPI have shown remarkable improvement during this period.
Traditionally, poverty has been measured by assessing monetary resources available for an individual or household. The monetary metric generally used were household income or consumption expenditure. However, this approach of measuring poverty has been criticized for not capturing the multiple deprivations which may be faced by individuals in their lives. Development not only constitutes economic progress, but also the process of expanding people’s capabilities to convert resources into valuable outcomes.
The global Multidimensional Poverty Index (MPI) is based on the of Alkire and Foster (AF) methodology that identifies people as poor or not poor based on a dual-cutoff counting method. It follows the universally acknowledged metric designed to assess acute poverty, providing a complementary perspective to conventional monetary-based measures of poverty assessment.
Global MPI uses 10 indicators covering three areas namely health, education and standard of living. Health dimension includes Nutrition and Child & Adolescent Mortality indicators, education dimension includes Years of Schooling and School Attendance indicators and standard of living dimension includes six household specific indicators namely, housing, household assets, type of Cooking Fuel, access to Sanitation, Drinking water and Electricity.
But, in its pursuit of addressing the intricacies of poverty, both NITI Aayog and its predecessor, the Planning Commission, have systematically generated poverty estimates over time. Furthermore, NITI Aayog has been entrusted with the task of formulating an indigenized index for measuring multi dimensional poverty estimates as part of the Global Indices for Reform and Action (GIRG) initiative.
The national MPI adopts the dual-cutoff approach of the AF methodology, consistent with the methodology used in the global MPI report. The national MPI retains all the ten indicators from the global MPI and incorporates two additional indicators, Maternal Health and Bank Accounts, in line with India’s national priorities.
The NITI Aayog publication says, “Over the last nearly two decades, there have been substantial improvements in quality of lives of people with poverty levels declining sharply from more than 50 per cent to 11.28 per cent.”
It says that India is all set to reach single digit poverty levels during 2024. The rate of decline in multi dimensional poverty has accelerated during the period 2013-14 to 2022-23. This is made possible by a large number of initiatives/ schemes of the Government targeted at improving specific deprivation aspects.
About 24.82 crore people escaping multidimensional poverty with a fall in headcount ratio by 17.89 percentage points will also help in accelerating the achievement of Sustainable Development Goals. While the performance of States varies, some States which were historically having high poverty have made remarkable progress in bringing people out of poverty, thus reducing inter-state variations in multidimensional poverty.
As the document says, “The Government of India has made significant strides in enhancing the quality of life for millions of individuals, with a focus on the SDG 1.2 target of halving poverty in all its dimensions. Initiatives such as Poshan Abhiyan and Anaemia Mukt Bharat have played a crucial role in addressing reach to health facilities, resulting in a substantial reduction in deprivation.”