India’s Multidimensional Poverty: Progress, Initiatives, and Challenges

Niti Aayog has reported a notable reduction in India’s ‘multidimensional poverty line,’ observing a decrease from 24.85% in 2015-16 to 14.96% in 2019-21. This translates to an elevation of approximately 135 million people above the poverty line within this timeframe. This significant achievement is seen as a pivotal move towards meeting the Sustainable Development Goal (SDG) of halving the populace living in poverty.

In line with the Global Indices for Reforms and Growth (GIRG) guidelines, the Indian government has designated Niti Aayog to oversee the unique Multidimensional Poverty Index (MPI). Drawing insights from the latest National Family Health Survey NFHS-5 (2019-21), the MPI’s second edition reveals the nation’s strides in curtailing multidimensional poverty between NFHS-4 (2015-16) and NFHS-5 (2019-21).

This MPI report is an extension of the Baseline Report of India’s National MPI from November 2021. The globally recognized MPI report emerges from a collaboration between the United Nations Development Programme (UNDP) and the Oxford Policy and Human Development Initiative (OPHI) as their technical partners.

Traditionally, poverty was gauged primarily on financial metrics, overlooking qualitative dimensions. However, the MPI adopts a more comprehensive approach than just income-based assessments. Established by UNDP since 2010, the MPI encompasses three pivotal domains: health, education, and living standards.

Using the Alkire-Foster method, the MPI measures both the intensity and the breadth of poverty. The final MPI score is derived by multiplying the proportion of those impoverished with the average deprivation score among them. This facilitates a nuanced understanding of multidimensional poverty, enabling tailored policy interventions at national, state, and district levels.

Various indicators were chosen by the coordinating committee for the MPI, including aspects like nutrition, education, health, sanitation, and economic factors.

Key Insights from the Report
The study emphasizes the remarkable drop in India’s ‘multidimensional poverty line’. It highlights a swift decline in rural areas from 32.59% to 19.28% and in urban areas from 8.65% to 5.27%. Uttar Pradesh leads the states in reducing the number of its MPI poor, followed by Bihar and Madhya Pradesh.

However, the report indicates marginal improvement in education and health. The most notable enhancements are seen in living standards, especially in sanitation, cooking fuel, and electricity availability.

The Economic Survey of 2022-23 attributes much of this progress to various government initiatives such as the Pradhan Mantri Awas Yojana (housing), Jal Jeevan Mission (clean water), and the Pradhan Mantri Jan Dhan Yojana (financial inclusion), to name a few.

Report Shortcomings

The report commends the government’s dedicated schemes, but there’s an oversight regarding the Covid-19 pandemic’s influence on poverty estimations. Most of the data for NFHS-5 was collected before the pandemic’s onset. The document also misses out on depicting India’s economic and social dynamics in recent years.

This assessment is crucial for stakeholders, from policymakers and state authorities to academia and citizens, aiding them in gauging policy impacts and charting progress through data-driven actions. The ultimate objective is aligned with India’s SDG 2030 goal of 1.2.

This report is viewed as a benchmark in India’s pursuit of achieving its targets ahead of schedule. As highlighted by Dr. Yogesh Suri of the National Institute of Transforming India, eradicating poverty is essential for sustainable progress. This effort is seen as India’s commitment to align with Global Sustainable Development Goals, improving its stature in global rankings.

Disclaimer: The views expressed in this feature article are of the author. This is not meant to be an advisory to purchase or invest in products, services or solutions of a particular type or, those promoted and sold by a particular company, their legal subsidiary in India or their channel partners. No warranty or any other liability is either expressed or implied.
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