Topic 16 poverty(ii)

Poverty Alleviation: Indian Food Security Oriented

Approach

M.H. Suryanarayana

[email protected]

04/12/2023 [email protected] 2

Outline of Presentation

Motivation

• Macro dimension: Estimates, Resource Imperatives & Choice of Development Strategies

• Micro dimension: Programmes for Poverty Alleviation subject to Macro Constraints

• Development Puzzles and Policy Dilemmas

Conceptualization

Evaluation

• Food Security Oriented Strategy: A Policy Imperative


Policy Imperative

• Colonial rule & consequences: – Only Law & order & Tax collection– No Development Expenditure– Abysmal living conditions:

• Stagnant real income and food production (first five decades of 20th Century)

• High illiteracy (84%); mortality rate (27.4 per 1000)


Conceptualization

• Evolution constrained by information base• Macro Perspective with micro foundations:• Pre-Independence Era:

• (i) Naoroji (1901)‘Poverty and Un-British Rural India’:• Income generated insufficient to meet the

‘necessary consumption’ of the population• (ii) National Planning Committee (1938):

Emphasis on multiple dimensions


National Planning Committee (1938)

Ten-year Plan Targets for Multiple dimensions:

i. Balanced Diet of 2400-2800 kilo calories per adult worker;

ii. Improvement in clothing from 15 yards to at least 30 yards per capita per annum;

iii. Housing: at least 10 square feet per capita;

iv. Liquidation of illiteracy;

v. Increase in life expectancy; and

vi. Access to adequate medical facilities.


A Decade of Planning: Outcome Evaluation• Income Distribution Committee (1962) • Working Group on Poverty:

– Poverty line: Rs 20 per capita per month at 1960/61 prices.– Provide for a balanced diet as per the Nutrition Advisory

Committee of the Indian Council of Medical research.– Excluded expenditure on health & education to be provided

by the State.– To get food to meet minimum energy requirements for an

active and healthy life and also minimum clothing and shelter.


Conceptualization: Post Independence era

• Official Indian definition of ‘Poor’: – “Those whose per capita consumption expenditure lies

below the midpoint of the monthly per capita expenditure class having a per capita daily calorie intake of 2400 calories in rural areas and 2100 in urban”

– Food (cereals) - a major source (85%) of calories; hence, emphasis on food


Food Energy Intake Method

Food Energy Intake

Household Consumer Expenditure

Min Calorie Intake

( 2400 Kcal.)

PL


Expert Group (1993):

• Endorsed the poverty norm anchored in a minimum calorie requirement

• Distinguished between issues of under-nutrition and measurement of poverty


Incidence of Poverty (million): 1983-2004

1983 1993 2004

251.96244.03

220.92

70.94 76.34 80.80

Rural Urban


Conceptualization: New Millennium

• Economic Reform Era: Bleeding rural India• Policy response: Expert Committees• Poverty line:

– Delinked from the calorie norm– Social perception of deprivation of basic needs– Validates with reference to calorie norm– Provides for a budget share of 54% for food– Poverty estimate of 37% - a case for Right to

Food Act


Policy Choices

Composition of Rural Households (1983)

04/12/2023 [email protected]

40.72

11.7

30.7

6.57 10.31

Self Eemploy AgSelf Empl NonAgAgr LabourOther LabourOther Rural

Composition of Rural Unemployment (1983)


16.32

8.5

59.54

10.215.43


Composition of Rural Poor Households (1983)


32.04

10.2945.59

5.996.17


Incidence of Poverty across Households Type (1983)


Self Eemploy Ag Self Empl NonAg Agr Labour Other Labour Other Rural All 0

5

10

15

20

25

30

35

40

45

50

24.08

26.93

45.45

27.93

18.32

30.62

Food Budget Share (%) (1972/73)


0-13 13-15 15-18 18-21 21-24 24-28 28-34 34-43 43-55 55-75 75-100 100-150

150-200

200+ All0

10

20

30

40

50

60

70

80

90

Illiteracy (%) Across Expenditure Classes (1983)


0-30 30-40 40-50 50-60 60-70 70-85 85-100 100-125 125-150 150-200 200-250 250-300 300+ All0

10

20

30

40

50

60

70

80

90


Development Strategy

• Growth with Redistributive Justice:– Planning production by physical controls– Food insecure poor; hence, emphasis on food

production & income generation

• Three-pronged strategy:– Macro: Increase food availability through

production (input subsidies for farmers) & imports– Meso: Food distribution programmes (PDS) (largely

Urban sector to promote eco devt)– Micro: Income generating programmes


Strategy for Agricultural Growth

• Green Revolution:– (i) Price support for output; (ii) input price subsidy; &

(iii) PDS– Change in food grain production composition =>

increase in cost of calories – Increase in regional disparities– Increase in price dispersion worsened food security in

remote rural areas => inevitability of PDS – Targeting Errors in income generating programmes


Economic Reforms

• Adjustment with a Human Face• Options for PDS reform – dismantle; mean-based

targeting; commodity-base targeting; food stamps/cash transfers

• PDS evaluation – Targeting a Penalty on the Food Insecure


Identification for Targeting

• Universal vs. Targeted Programmes• Universal: Self-selection of beneficiaries• Targeted: Economic status of the beneficiary

– Targeted PDS with respect to • (i) occupational; • (ii) Household ; & • (iii) Social characteristics


BPL Census

• Purpose: Classify rural households into BPL & APL categories

• Criterion:– Census 1992: Income per household (RS 11000 / annum)– Census 1997: Two-stage procedure

• 1st : Assets, durables & income• 2nd: Consumer expenditure (Poverty line)

– Census 2002:• Indicators of quality of life & scores

– Census 2009: Three Step procedure


Development Puzzles & Policy Dilemmas


Fig. 1: Rural Poverty

0

10

20

30

40

50

60

70

1951

-52

53-5

4

55-5

6

57-5

8

59-6

0

61-6

2

63-6

4

65-6

6

67-6

8

69-7

0

71-7

2

73-7

4

75-7

6

77-7

8

79-8

0

81-8

2

83-8

4

85-8

6

87-8

8

89-9

019

91

93-9

4

Year

He

ad

cou

nt

rati

o (

pe

r ce

nt)

Source: World Bank (1997)


Fig. 2: Monthly Per-Capita Consumer Expenditure by the Poorest Decile Groups and Total Population: All-India Rural

0

5

10

15

20

25

301

96

0-6

1

61

-62

62

-63

63

-64

64

-65

65

-66

66

-67

67

-68

68

-69

69

-70

70

-71

71

-72

72

-73

73

-74

74

-75

75

-76

76

-77

77

-78

78

-79

79

-80

80

-81

81

-82

19

83

83

-84

84

-85

85

-86

86

-87

87

-88

88

-89

89

-90

90

-91

19

92

93

-94

93

-94

Year

Rs

at

1960

-61

pri

ces

Poorest Decile Group (PDG) 2nd PDG 3rd PDG 4th PDG 5th PDG Total Rural


Average MPCE in different States 2004-05

Nutrition based Poverty Trap?Macro evidence


Incidence of Calorie Deficiency (%)Norms: 2400 Kcal (Rural); 2100 Kcal (Urban)

1983 1987/88 1993/94 1999/00 2004/050

10

20

30

40

50

60

70

80

66.1 65.9

71.174.2

79.8

60.557.1 58.1 58.2

63.964.8 63.9

67.870.1

75.8

Rural

Urban

All India


Per Capita Calorie Intake by Deceile Group: All India Rural

0

500

1000

1500

2000

2500

3000

3500

4000

4500

1972/73 1983 1993/94 1999/00 2004/05

Year

Kca

ls pe

r diem

Decile Group I II III IV V VI VII VIII IX X Norm


Per Capita Calorie Intake by Decile Group: All India Urban

0

500

1000

1500

2000

2500

3000

3500

4000

1972/73 1983 1993/94 1999/00 2004/05

Year

Kca

ls pe

r diem

Decile Group I II III IV V VI VII VIII IX X Norm


Measures of Health Status


Infant Mortality Rate

Rural Urban All India0

10

20

30

40

50

60

70

80

90 85

56

79

73

47

68

62

42

57

NFHS-1NFHS-2NFHS-3

(Deaths at age 0-11 months per 1,000 live births)

NFHS-3, India, 2005-06

Child Nutritional Status

Stunted Wasted Underweight0

10

20

30

40

50

60

51

20

4345

23

40

NFHS-2NFHS-3

(% children age under 3 years)

NFHS-3, India, 2005-0604/12/2023 [email protected]


Growth & Poverty Reduction: At what Cost?

Topic 16 poverty(ii)

Health & Medicine

Transcript of Topic 16 poverty(ii)