Current Affairs July 30, 2023: National Multidimensional Poverty Index, 2023 Global Multidimensional Poverty Index, Poverty line estimation in India

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{GS2 – Poverty – 2023/07/18} National Multidimensional Poverty Index (MPI)

  • Context (TH | TH): 415 million Indians came out of multidimensional poverty in 15 years, says UN.
  • NITI Aayog index says 13.5 cr Indians lifted out of multidimensional poverty in last five years.

Global Multidimensional Poverty Index (MPI)

  • Global MPI is a measure of multidimensional poverty covering 107 developing countries.
  • It was first developed in 2010 by Oxford Poverty and Human Development Initiative (OPHI) and United Nations Development Programme (UNDP) for UNDP’s Human Development Reports.
  • Global MPI uses three dimensions and ten indicators.

Global Multidimensional Poverty Index (MPI)

  • All indicators are equally weighted within each dimension.
  • The MPI ranges from 0 to 1, and higher values imply higher poverty.
  • Global MPI complements the international $2.15 a day poverty rate devised by World Bank.
  • Human development indices by United Nations Development Programme (UNDP):
    1. Human Development Index (HDI)
    2. Inequality Adjusted HDI (IHDI)
    3. Gender Development Index (GDI)
    4. Gender Inequality Index (GII)
    5. Multidimensional Poverty Index (MPI)

Data used for Global MPI

  • For India, GMPI uses the National Family Health Survey (NFHS) data.
  • NFHS is conducted under the aegis of Ministry of Health and Family Welfare (MoHFW) and International Institute for Population Sciences (IIPS).

Nodal agency in India

  • NITI Aayog is the nodal agency responsible for monitoring mechanism of the Global MPI in India.
  • As the Nodal agency for the MPI, NITI Aayog has constituted a Multidimensional Poverty Index Coordination Committee (MPICC).

2023 Global Multidimensional Poverty Index (MPI)

  • 1.1 billion out of 6.1 billion (~18%) live in acute multidimensional poverty across 110 countries.
  • 25 countries, including India, successfully halved their global MPI values within 15 years.

Findings related to India

  • Deprivation in all indicators declined in India.
  • People who are multidimensionally poor and deprived under the nutrition indicator in India declined from 44.3% in 2005-06 to 11.8% in 2019-21.
  • A total of 415 million people moved out of poverty in India within 15 years (2005-06 to 2019-21).

National Multidimensional Poverty Index (National MPI)

  • It is published by NITI Aayog using the methodology in consonance with the global methodology.
  • Like the global MPI, India’s national MPI has three equally weighted dimensionsHealth, Education, and Standard of living – represented by twelve indicators.
  • The national MPI model retains the ten indicators of the global MPI model.
  • It also adds two indicators, viz., Maternal Health and Bank Accounts, in line with national priorities.

National MPI, 2023

  • It is the second edition of the National MPI.
  • It is prepared based on the latest National Family Heath Survey of 2019-21.
  • It represents India’s progress in reducing multidimensional poverty between the two surveys, NFHS-4 (2015-16) and NFHS-5 (2019-21).

Indicators and their respective weightage

Highlights of the report

  • Nearly 13.5 crore people came out of multidimensional poverty in five years.
  • Uttar Pradesh registered the largest decline in the number of poor, with 3.43 crore people escaping multidimensional poverty.
  • India registered a steep decline in the number of multidimensionally poor from 24.85% to 14.96% between 2015-16 and 2019-21.

National Multidimensional Poverty Index

  • Between 2015-16 and 2019-21, the MPI value has nearly halved from 0.117 to 0.066 and the intensity of poverty has reduced from 47% to 44%.
  • India is on the path of achieving the SDG Target 1.2 (of reducing multidimensional poverty by at least half) much ahead of the stipulated timeline of 2030.

Multidimensional Poverty in India

NFHS Survey about Multidimensional Poverty in India

Multidimensional Poverty Index Progress Report 2023.

Percentage of the total population who are multidimensionally poor

Percentage of the total population in states who are Multidimensionally Poor

State/UT Wise percentage point change in the Headcount Ratio between 2015-16 and 2019-21

NFHS-4 MPI NFHS-5 MPI

  • The most rapid reduction in the proportion of multidimensionally poor individuals occurred in districts located within the states of Madhya Pradesh, Gujarat, Uttar Pradesh, and Rajasthan.

NFHS-4 MPI

NFHS-5 MPI

Poverty line estimation in India

  • Poverty line is the amount of money needed for a person to meet his basic needs.

Pre-Independence Poverty Estimation

  1. Dadabhai Naoroji in his book ‘Poverty and Un-British Rule in India,’ made the earliest estimate of poverty line of ₹16 to ₹35 per capita per year at 1867-68 prices.
  2. The Bombay Plan (1944) suggested a poverty line of ₹75 per capita per year.

Post- Independence Poverty Estimation

Committees

Poverty line

Rural

Urban

Lakdawala Committee (1993) (per capita per month) Rs. 49.09 Rs. 56.64
Tendulkar Committee (2005) (per capita per day) Rs. 26 Rs. 32
Rangarajan Committee (2012) (per capita per day) Rs. 32 Rs. 47
  • Lakdawala Committee, Tendulkar Committee, Rangarajan Committee have used the per capita consumption expenditure to estimate the poverty line.      
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