India’s poverty level down to 5% of population

NITI Aayog CEO has said India's poverty level has fallen to just five per cent, signalling an improvement in the nation's economic landscape.

• Data source: Latest consumer expenditure surveyconducted by the National Sample Survey Office (NSSO).
  • The survey categorised people into 20 different groups, revealing that the average per capita monthly expenditure in rural areas is Rs 3,773, while in urban areas, it stands at Rs 6,459.
• The Survey revealed that per capita monthly household expenditure more than doubled in 2022-23 as compared to 2011-12.

• The data indicates that poverty in India is now below five per cent.

The trends

• The consumption has surged by 2.5 times in both rural and urban areas, indicating progress across the board.
• The gap is narrowing between rural and urban consumption, suggesting a positive trajectory towards economic parity.
• There is the decline in the consumption of cereals and food items, indicating a shift towards a more prosperous lifestyle.
• People are now allocating more income towards non-food items, such as milk, fruits, vegetables, and processed foods, reflecting increased prosperity and evolving consumption patterns.

What is Poverty?

• Poverty can be defined as a condition in which an individual or household lacks the financial resources to afford a basic minimum standard of living.
• The World Bank defines poverty using the International Poverty Line, which designates extreme poverty at $2.15 per person per day, while $3.65 falls under the lower-middle income category, and $6.85 is classified as upper-middle income.

Types of Poverty:

• Absolute Poverty: Lack of basic necessities like food, shelter, and healthcare, threatening survival.
• Relative Poverty: Deprivation in comparison to the broader society, despite meeting basic needs.
• Urban Poverty: Concentrated in urban areas, characterized by slums, unemployment, and inadequate living conditions.
• Rural Poverty: Predominant in rural regions, often linked to agricultural challenges, low income, and limited access to services.
• Cyclical Poverty: Temporary state due to economic fluctuations or personal circumstances.
• Chronic Poverty: Persistent, long-term deprivation often linked to systemic issues and lack of opportunities.
• Income Poverty: Lack of sufficient income to meet basic needs.
• Multidimensional Poverty: Deprivation in various aspects, including education, health, and living standards.