84% households suffer decline in income, over 1/3 households may run out of resources by next week: CMIE
Centre for Monitoring Indian Economy in its study has stated that more than one-third of Indian households may run out of resources in another week and face distress without assistance after that
Centre for Monitoring Indian Economy (CMIE) in its study has stated that more than one-third of Indian households may run out of resources in another week and face distress without assistance after that, a report in Economic Times said.
The study is based on the impact of lockdown on Indian household income that was released on Tuesday, May 12. It also stated that 84% household has suffered a decrease in monthly income and that more than one-fourth of the country’s working-age population is unemployed.
“Across India, 34% of all households report being able to survive for no more than one week without additional assistance,” said the study co-authored by CMIE chief economist Kaushik Krishnan.
It also highlighted the urgent need to support households at the lower end of the income spectrum.
“These figures suggest that the rapid distribution of in-kind or cash transfers is needed to prevent a sharp increase in malnutrition and severe deprivation,” the study said.
CMIE’s study observed that the decline in household income synced with a sharp increase in the rate of unemployment to 25.5% as on May 5 from 7.4% on March 21, as per the CMIE’s quarterly Consumer Pyramids Household Survey (CPHS).
Data in the study unveiled the urban-rural divide, with 65% of urban households reporting enough provisions for a week while only 54% of rural households said they have enough provisions.
Some states like Delhi, Punjab and Karnataka were least affected, states like Bihar, Haryana and Jharkhand were among the worst affected, the study said, as reported by Economic Times.
It is reportedly indicated that factors like per capita income before the lockdown, the effectiveness of aid, delivery and lockdown severity rather than the extent of outbreak affects the declining income.
The study was authored by CMIE’s Krishnan, Marianne Bertrand, professor at the University of Chicago Booth School of Business, and Heather Schofield, assistant professor at the Wharton School of the University of Pennsylvania.