New Delhi: The raging economic crisis appears to have hit the poor in India hard, as an expert group headed by former chairman of the Prime Minister’s Economic Advisory Council, Dr C. Rangarajan, which submitted its report last week, revealed that the number of poor in the country is 7.5 per cent more than what was estimated earlier.
Sources in the government privy to the report revealed that the Rangarajan panel found that as of 2011-12, around 29.5 per cent of India’s population lived below the poverty line (BPL) as against the 21.9 per cent earlier estimated by the Planning Commission using the Tendulkar methodology.
On the controversial question of poverty line, the Rangarajan report says that any person who spent more than Rs 972 in rural areas and Rs 1,407 in urban areas in a month in 2011-12 has not been counted under the BPL category. If the monthly figures are calculated on a daily basis, they translate into a per capita expenditure of Rs 32 in rural areas and Rs 46 in urban areas. The BPL benchmark according to the Tendulkar estimate for 2011-12 was Rs 816 in rural areas and Rs 1,000 in urban areas, which on a daily basis came to be Rs 27 in rural areas and Rs 33 in urban areas.
The Planning Comm-ission had constituted the expert group headed by Dr Rangarajan in the midst of a massive uproar over the “abnormally low” poverty line fixed by the then UPA government in May 2012.
Opposition parties and activists had alleged that it gave a false impression of the decline of poverty in the country. The expert group was mandated to revisit the methodology for the estimation of the BPL population and identification of poor.
Incidentally, the Rangarajan panel not only reviewed the existing methodology for estimating poverty, which was based on the suggestions made by the late noted economist Suresh Tendulkar, it also assessed whether poverty can be determined on any other criteria other than consumption basket.
The Rangarajan report also reviewed the divergence between the National Sample Survey Organisation estimates on consumption expenditure and those put up by the Central Statistical Organisation. Sources said that the current report has also suggested that poverty ratio should be disengaged from entitlements under various social security programmes of the government.