Looking at the estimated poverty decline in India between 2011-12 and 2016-17, do you think time has come for our economic policies to change? Comment.
The NSSO Consumer Expenditure Survey report 2017-18 is soon to be released. As per the trends of consumer expenditure and consumer prices, great changes need to be introduced in the way Indians think about the poverty and its removal, its macro and microeconomic policies especially the ones which were based on agriculture. The government needs to rethink many aspects and seriously consider rethinking economic policies:
ï¿½ The government has to recognize the fact that India is no longer a poor country as only 4.5 per cent of the population is categorised as being poor.
ï¿½ The measure of food consumption has always been regarded as a benchmark of poverty. Thus, a vast landscape of food production, consumption and even distribution has been set-up. The time has finally come to change this.
ï¿½ Next, the government has to basically think about poverty in relative terms and not on the basis of absolute terms i.e. a fixed proportion of median income. But before jumping onto it, India should consider shifting the poverty line as per our income status as a middle-income country.
ï¿½ Finally, poverty should not be seen in terms of quantity but quality i.e. electricity, health, education, jobs, sanitation, etc. The government can also rethink the current agriculture policy.
All of the above have been deduced from the trends which will be seen in the latest NSSO survey of consumer expenditure which is generally considered as a potent indicator of poverty. Currently, it stands at 60 per cent of GDP. As per the World Bank, poverty line estimates for middle-income economies, the poverty in India has come down to 31% from a high figure of 57% in just 6 years. Most of this population is based in the states of UP, Bihar and MP. Thus, more targeted transfer of incomes in needed. The DBT mechanism of the government has successfully solved targeting programs for over 430 government schools and subsidies. Also, the government should consider bringing more people under the provision of the tax net. The government needs to free resources for some vital areas like road, water and railways. Times have changed and there is an urgent need to improve the policies of the government.
Published: June 28, 2019 | Modified:December 1, 2019