Page 73 - DECO502_INDIAN_ECONOMIC_POLICY_ENGLISH

Unit 7: Poverty: Concept, Cause and Government Policies

Table 2 : Percentage of Poor and Total Number of poor in India Since 1973 Notes

Year Percentage Number of Average Annual
of poor (%) poor (million) Rate of Decline

1973-74 54.9 321 –0.59
1977-78 51.3 329 0.31
1983 44.5 323 0.31
1987-88 38.9 307 1.25
1993-94 36.0 320 –0.70
1999-00 26.1 260 3.40
2004 23.6 250 0.82

*Based on the estimated population of 2004 and poverty ratio calculated using latest NSS data in
2004.
Source : National Institute of Rural Development (2004) : Rural Development Statistics (2002-03)
An Estimate of the Rural Poor has been made on the basis of official estimates and MPCE (Monthly
per Capita Expenditure) providing 2,400 calories. Since the norm of MPCE for 1973-74 was correctly
applied, the estimate of poverty by both the methods works out to be 56.4%. But for year 1993-94 and
1999-00, the official estimates were much lower than that based on MPCE providing 2,400 calories.
Utsa Patnaik concludes her critique with the following observation : “Sometime to justify the indirect
method, it is argued in an illogical manner that the original consumption norm of 2,400 calories was
‘too high’. First, it is not ‘too high’ because the average intake of those below it works out to less than
1,900 calories which is lower than in any other country in the world except the least developed
countries. Second, even if it is accepted for the sake of argument that it is ‘too high’, it does not justify
comparing 1999-00 ‘poverty’ figures which are of all those persons below 1,890 calories intake , to
those below 1,970 calories in 1993-94 and below 2,400 calories intake in 1973-74.”
Table 3 : Poverty distribution of Persons by Per capita Monthly
Expenditure and Calorie intake, 1999-00, All India

Monthly Calorie Percentage of Cumulative
Per capita intake total persons percentage
Expenditure `` `` `) per day
(1) (2) (3) (4)
Rural
Below 225 1,383 5.1 5.1
225-255 1,609 5.0 10.1
255-300 1,733 10.1 20.2
300-340 1,868 10.0 30.2
340-380 1,957 10.3 40.5
380-420 2,054 9.7 50.2
420-470 2,173 10.2 60.4
475-525 2,289 9.3 69.7
525-615 2,403 10.3 80.0

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