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Niti Aayog cautious on poverty lines

To engage with states, govt wants anti-poverty programmes made more effective

Policy Pulse
Publish Date: Mar 19 2016 11:29AM | Updated Date: Mar 19 2016 11:29AM

Niti Aayog cautious on poverty lines

 The NITI Aayog is treading with caution on estimation of poverty cut-off lines. The issue had triggered a big controversy in the previous United Progressive Alliance administration.

An Aayog task force, headed by Vice-Chairman Arvind Panagariya, will issue a poverty line based on the Suresh Tendulkar committee recommendations or those  of the C Rangarajan panel or an entirely new methodology in the next six months, sources said, after extensive discussions with states and other stakeholders.
As of now, there is no unanimity within the task force on the methodology, they added.
"The task force on poverty elimination has prepared a discussion paper and will invite comments from stakeholders and states next week before firming up its recommendations," a source said.
Meanwhile, it has suggested a number of steps. These include making anti-poverty  programmes such as the Public Distribution System (PDS),  Mid-day Meal Scheme, Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) and Housing for All more effective, the sources said. It feels poverty could only be reduced if job-intensive economic growth accelerates on a sustained basis.
The panel has decided there are four ways that could be considered for tracking the poor. One could continue with the Tendulkar poverty line, switch to the Rangarajan or other higher rural and urban poverty lines, track progress of the bottom 30 per cent of the population over time, or track progress along specific components of poverty, such as nutrition, housing, drinking water, sanitation, electricity and connectivity.
While the last two could complement the measurement of poverty, using a poverty line, these cannot substitute for it, the task force decided.
The task force deliberated on pros and cons of both. It noted the main criticism of the Tendulkar method was that the poverty line was too low. The counter-argument is that if the aim is to assess whether we are making progress in bringing households out of extreme poverty, it makes sense to set the line at a level that allows two square meals a day and other basic necessities.
The task force says the poor predominantly reside in rural areas, where incomes critically depend on agricultural growth. As such, it lays focus on raising productivity in agriculture, giving remunerative prices to farmers, the need for a second 'green revolution' in rain-fed areas in general and eastern India in particular, helping small and marginal farmers by reforming tenancy laws, and bringing relief to farmers in natural disasters.
However, it conceded that, historically, agriculture has not grown in India at rates exceeding five per cent a year on a sustained basis, unlike in industry and services. As such, the benefits of growth can be shared more equally only by creating gainful employment in the latter two sectors.