F14-Poverty

A recent study led by Sonalde Desai, a sociologist and professor at University of Maryland, College Park, and National Council of Applied Economic Research, challenges the notion that the relationship between people and poverty in India is linear even as the economy has grown rapidly over the last two decades. As opposed to millions of people escaping – or being lifted out of – chronic poverty over time, the study finds that people move in and out of poverty depending on life’s circumstances such as natural disasters, illness and other financial shocks. https://scroll.in/article/1077617/millions-lifted-out-of-poverty-in-india-but-many-still-lead-precarious-lives-on-the-edge 

This phenomenon is called transient poverty, and it is difficult to measure because of lack of real-time data on households

Even as Indians are escaping poverty, according to Desai, they get placed on “a precarious perch where a single accident, natural disaster, or epidemic could push them back into poverty”.

Both Desai and Krishna singled out healthcare-related financial shocks as the top reason behind transient poverty in India. In 2011-’12, out-of-pocket expenditure on health drove 55 million Indians into poverty 

"There are certain parts of India where there aren’t doctors, where there aren’t medical facilities,” Krishna said. This year, the government spent only about 1.2% of GDP on healthcare, according to The Lancet.

by Rohit Inani, IndiaSpend.com

12/01/2025

Lakshmina had been admitted to a hospital and had just given birth to a baby girl. The woman running the hospital asked for Rs 4,000 to discharge her. The couple did not have a single penny. Haresh requested the villagers for a loan but no one gave him any money. Helpless, he sold his son through a middleman. https://thewire.in/rights/behind-up-couple-forced-to-sell-son-for-rs-20000-an-inescapable-microfinance-debt-trap 

When Haresh left farming, Lakshmina came in contact with a group of women. Microfinance companies showed her the dream of making her life better with loans. Between September and December 2023, Lakshmina and Haresh borrowed loans totalling over Rs 2 lakh from five microfinance companies. They attempted to pay instalments of one loan with the money from another loan, but in a few months all the cash was exhausted and they did not even have the money to pay the instalment.

Utkarsh Small Finance Bank lent a loan of Rs 30,000 to Lakshmina on November 18, 2023, which was to be repaid in 24 months with 25% actual interest. An instalment of Rs 740 was to be paid every fortnight. The microfinance company charged Rs 354 as processing fee, Rs 1,104 as other fees and Rs 750 as insurance fee for this loan. After deduction of these charges, she got only Rs 28,896 in hand, whereas she had to pay Rs 3,892 in 24 months including interest.

Lakshmina and Haresh have not been able to deposit amount towards this loan after April 2024.

The question arises as to why microfinance companies were giving loans to Lakshmina and Haresh, when anyone who visited their house could see their abject poverty. One microfinance company has stated Haresh’s annual income as Rs 3 lakh in its documents. If loan payments are not deposited, the borrowers are subjected to physical and mental harassment. The poor who are already financially destitute are being drained further.

In rural areas, the debt trap of microfinance companies is now firmly a death trap for the poor. Several incidents of death by suicide by people entangled in such webs of debt are coming to light. In December 2023, a woman trapped in microfinance debt died by suicide in Mishrauli village of Sevarhi area in ​​Kushinagar district.

by Manoj Singh 

17/09/2024

In 2021, three in four people in India could not afford a healthy diet. In South Asia, the pandemic disrupted work and disproportionately impacted poorer families.

https://thewire.in/rights/subsidised-food-canteens-create-democratic-spaces-in-deeply-divided-societies 

Following the pandemic in 2020, the Indira Rasoi Yojana [now called Shree Annapurna Rasoi Yojana] was started by the Congress-led government in Rajasthan to provide subsidised nutritious meals for the urban poor.

Imediately after the pandemic-induced lockdown, Khera (along with Jean Drèze and Meghana Mungikar) had highlighted the exclusion of 100 million people from the government’s subsidised food grain programme which has more than 800 million beneficiaries. It is exacerbated by the indefinite delay in the population Census 2021, she said.

As India votes for the 18th Lok Sabha, we speak with Khera on various social security schemes including maternity entitlements, healthcare, food-related welfare like community kitchens, which are important in the context of the decline in real wages.

Amma’s canteens in Tamil Nadu were the first “on scale” initiative and were set up in 2013 (there have been such initiatives even before that). After this, Indira canteens were set up in Karnataka. Most recently, and perhaps overtaking these two states in terms of scale, was Rajasthan’s Indira Rasoi scheme that began in 2020 in response to the humanitarian crisis created by the Covid-19 lockdown. In November 2023, there were more than 1,100 Indira Rasois in Rajasthan. These canteens provide breakfast/lunch and dinner at Rs 3 to Rs 8 per plate.

Canteens have fostered the creation of democratic spaces in deeply divided (on caste and class lines) societies. One of the most remarkable was a canteen near a hospital in Jaipur where we saw patients, doctors, lab technicians and cleaning staff among others, eating in the same place.

by Shreehari Paliath, IndiaSpend

09/05/2024

Poverty Down, Files Burnt, Summons Missing |  https://www.youtube.com/watch?v=Pc1UQHWBESY  Cracknomics Ep 41
The Wire  Methods changed so results change...

From Google translate of Youtube Transcript:  (Under Edit)

In this episode, let us first look at the claim of the World Bank that it does not know about the poor but the government and institutions have a special interest in measuring poverty. Look, we have reduced poverty so much, we have performed better than the previous government. This is a good basis to pat one's back. Of course, reduction in poverty is a good economic and social indicator. Reduction in poverty means that more people are engaged in running the economy. Reduction in poverty means that people have more participation in the social and political space. But today, when everything is adulterated, even the data has to be checked carefully. First of all, let us talk about the poverty line. India uses consumption expenditure to measure poverty. It is considered more stable than income. The National Sample Survey Office (NSSO) collects this data. The Tendulkar Committee formed in 2005 last conducted the official poverty line. The line was drawn according to the data of that time. It was ₹447 per person per month in rural areas and ₹579 per person per month in urban areas. From time to time experts argue that this is too low. There was a lot of controversy in 2011-12. Even after adjusting for inflation, the poverty line was ₹33 per day in urban areas and ₹27 per day in rural areas. This is still our official poverty line. After this, the Rangarajan committee came in 2011 which raised the poverty line a little by applying a new method. It was ₹47 per day in urban areas and ₹32 per day in rural areas. It means that in 2011-12, while the poverty was 21.9% by Tendulkar method, the poverty was 29.5% by Rangarajan method. We are talking about this so that you can see that the data can easily change by changing the method. Now the World Bank is saying that in the 10 years from 2011-12 to 2022-23, 17 crore people have come out of poverty. In 2011-12, extreme poverty was 16.2% which has come down to just $.3% in 2022-23. Their methodology will also have to be questioned. According to how the World Bank defines poverty, those who spend $2.15 or less per day fall in the range of extreme poverty. $2.15 becomes about $180 per day. The World Bank has also made consumption data its basis here, meaning the economic condition of people is estimated on the basis of what they spend. This method has its own problem because in this the expenditure of self-employed and daily wage earners is not recorded accurately. It is not known. It is possible that you get money today and may not get it tomorrow, but the cost of food and drink of the family has to be borne every day. Income inequality gets hidden in the consumption data. It seems that if people are spending, they must also be earning something. Although consumption survey should be done every 5 years, but after the consumption survey of 2011-12, we had to wait for 10 years. After this, the next two surveys have come in 2022-23 and 2023-24. But experts say that there is a lot of difference in their methodology, due to which you cannot compare them. There is a difference not only in the sampling design but also in the methodology of data collection, recall period, level of aggregation. For example, during the survey, you are asked how much milk did you take in the last 7 days or how much milk did you take in the last 2 days. How many new clothes did you buy in the last 1 year? Or

How many new clothes did you buy in the last 6 months?

Just a little change in the survey results can make a lot of difference, but the main question is whether poverty has really reduced.

In their study published in EPW, Himanshu Peter Lanjao and Philip Shome showed how the pace of poverty reduction has slowed down.

There has been a reduction in poverty from 2011-12 till now, but this reduction is slower than 20045 to 2011-12.

Do you understand that the pace of poverty reduction has slowed down?

According to their estimates, there were 25 crore poor in 2011-12.

Their number has reduced slightly to 22.5 crore in 2022-23.

The World Bank report says that in 2011-12, 65% of the people in UP, Maharashtra, Bihar, Bengal and MP were extremely poor.

Despite the improvement, in 2022-23, the number of poor people will increase to 22.5 crore. 54% of the extreme poor are here As we discussed, consumption alone is not a good way to measure poverty We should look at other things as well Poverty itself is multidimensional, meaning you may be able to afford food, but if you fall sick, you may not be able to afford to go to the hospital There is food at home, but no money to send your child to school No money to buy books for him Similarly, facilities like electricity, water, transport, basic infrastructure etc. also decide how poor you are If poverty has reduced, then why? 30% of rural households survive on MNREGA work where wages are even lower than the market rate If poverty had reduced, would we still have to give free ration to 80 crore people The problem with making consumption data the basis is that the assessment of inequality has gone wrong You must be surprised, but listen, the World Bank report says that the country Inequality has reduced The World Bank's Poverty and Equity Brief says that in 2022-23, India's

The Gini index is 25.5. The Gini index is a tool to measure income inequality. It gives a ranking from zero to 100. Zero means no inequality. It means everyone is earning equally and 100 means the highest inequality. So our score is 25.5. In 2011-12, it was 28.8. So according to this, inequality has indeed reduced. But the World Inequality Database released in 2023 was saying that India's Gini coefficient on the basis of income is 62. What is happening? More equal on the basis of consumption and less equal on the basis of income. It means people like Ambani and Adani are also spending less but making a lot of money. So many reports have said that the inequality gap in the country has increased in the last few years. Have we forgotten that the top 1% rich people of the country have 40% of the country's wealth? Have we forgotten that during the Covid-19 pandemic, when poor people were returning to their homes from cities, Mukesh Ambani was earning 90 crores every hour. Despite Hindenburg's allegations and US court case, Adani's wealth has increased by 1 lakh crores, but look at the condition of the common people. Today, half of the country's population has assets worth less than 3.5 lakhs. A hospital bill can take you below the poverty line. That's why you need to see with your own eyes. Data can show you anything. The World Bank has currently given India good marks in reducing poverty and the government has also patted its back. Now, along with running AI and WhatsApp, you will also have to learn to understand data. 

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