How poor is India really?

In looking at prevalence of poverty among both urban and rural populations, a uniform benchmark of Rs 6,000 per month grossly underestimates the magnitude of poverty, writes Prabhat Patnaik

Daily wage labourers in Delhi (photo: National Herald archives)
Daily wage labourers in Delhi (photo: National Herald archives)
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Prabhat Patnaik

One of the striking findings of the Bihar caste survey is that absolute poverty in the country is far more pervasive than governments in India have claimed, showing that 34.1 per cent of Bihar’s population has a monthly household income of Rs 6,000 or less.

This benchmark figure of Rs 6,000 per month corresponds to the official ‘poverty line’ per the government’s own criterion. These days, however, the government has stopped talking about the poverty line altogether, and has adopted instead the concept of ‘multidimensional poverty’.

This approach reveals that only 15 per cent of the country’s population is in poverty. It is true that Bihar does not represent the country as a whole, but the figure is too high for the pervasiveness of poverty in the country to be denied.

There is a rationale for taking Rs 6,000 as the benchmark. For 2011-12, the government-appointed Tendulkar Committee had recommended a poverty line of Rs 29 per day for rural India.

If we take the consumer price index (CPI) for agricultural labourers, there has been a 77.5 per cent rise in the index between 2011-12 and 2021-22, which would make the corresponding poverty line amount for 2021-22 equal to Rs 51.475. For a family of four, this works out to a monthly sum of Rs 6,177.

A monthly income of Rs 6,000 therefore appears perfectly justified as the benchmark figure for rural poverty. The benchmark figure for urban poverty is, of course, much higher. In looking at the prevalence of poverty among the population as a whole, including urban and rural components, a uniform benchmark of Rs 6,000 per month grossly underestimates the magnitude of poverty.

Nonetheless, we continue to apply this uniform benchmark quite deliberately to the data in order to avoid any accusations of exaggeration. Despite being in conformity with official criterion, it is not really an appropriate one. The Tendulkar Committee was bound to respect official sensibilities in suggesting a poverty line. We can approach the problem differently.

The Planning Commission had originally accepted 2,200 calories per person per day as the benchmark for poverty in rural India. If we look at the National Sample Survey figures on the per capita expenditure level at which exactly 2,200 calories were accessed in rural India in 2017-18, it works out to Rs 70. For a family of four persons, this amounts to Rs 8,400 per month.

Between 2017-18 and 2021-22, there has been a 21 per cent increase in the agricultural labourers price index. Thus in 2021-22, the monthly household expenditure for a family of four that should define the benchmark for poverty in rural India is Rs 10,164.

In other words, we should, at the very least, take Rs 10,000 as the benchmark level of household income for defining rural poverty. The income level for defining urban poverty should be much higher; but let us deliberately apply a uniform benchmark for both urban and rural household incomes.


With Rs 10,000 as the benchmark, the Bihar caste survey reveals that 63.74 per cent (64 per cent in round figures) falls short. The idea that 64 per cent of the population is steeped in absolute poverty in the year 2022-23 is an amazing finding for a major state in India.

Official spokesmen keep emphasising growth in GDP, as if that ipso facto solves all the economic problems of the country. This government keeps proclaiming its vision of achieving a $5 trillion economy as the ultimate feather in its cap. If we extrapolate from Bihar to the country as a whole, behind all the talk of GDP growth lies the appalling fact that two-thirds of our population lives in absolute poverty.

A glimpse of this grim reality was already evident from a number of other indicators, particularly the Global Hunger Index that ranked India at 111 among a total of 125 countries. The fact that a survey conducted for an altogether different purpose — namely to ascertain the caste-wise distribution of the population — also revealed the pervasiveness of poverty and deprivation in the country, simply amplifies the harsh truth.

Yet, every such indicator is dismissed by the government as being inconsequential. The BJP’s position is that GDP growth is of paramount importance for the Indian economy, and that such growth can be ushered in only by capitalists, to whom all facilities must be provided, including incentives in the form of transfers.

The ‘nation’s interests’ have thus been made identical with the interests of the monopoly (crony) capitalists. The fact that India’s GDP growth — which the government claims to be the highest among the major economies of the world — still leaves two-thirds of the population in absolute poverty, underscores the vacuity and tendentiousness of the BJP’s argument.

As for the multidimensional poverty index, those findings are based on an intellectual misperception. Every mode of production has the poor within it acting in a particular way, hence every mode of production must have its own criteria for identifying poverty. Under feudalism, for instance, poverty takes the specific form of children being starved, deprived of education, and exploited by being compelled to join the work force.

Under capitalism, on the other hand, poverty does not take the form of enforced child labour but a push towards crime, caused by children growing up in squalid surroundings, with access to only the poorest of schools and healthcare facilities, deprived of things (including gadgets) that their better-off peers take for granted.

The link between poverty and crime is particularly strong under advanced capitalism, which is one reason why any survey on poverty which does not cover jail inmates remains unsatisfactory.

In short, the criteria for identifying poverty must differ from one mode of production to another. If we must have one criterion to cover all forms of poverty, especially in a society like ours where we have an amalgam of different modes of production, then that has to be the level of income.

As we have seen, income itself is not an easy concept to measure, which is why some easily measurable proxy has to be found. The level of nutrition is one such proxy. Whatever the setting, feudal or capitalistic, the poor are invariably undernourished.

The problem with the multidimensional poverty index is that it gives a very low weightage to nutrition, and also takes a poor approximation to it such as body mass index. It considers a number of other measures such as school attendance and access to gadgets as signifiers of the absence of poverty, while these only signify, at best, a transition from feudal poverty to capitalist poverty.

It is on the basis of this utterly dubious multidimensional poverty measure that the BJP government has been claiming that GDP growth leads to the automatic elimination of poverty. The findings of the Bihar caste census should be an eye-opener for all those who have been taken in by such propaganda.

(IPA Service. Courtesy: People’s Democracy)

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