In 9 years, 248mn pulled out of multidimensional poverty: Niti Aayog paper

India’s so-called multidimensional poverty fell from 29.17% in 2013-14, when the Modi government assumed power, to 11.28% in 2022-23

New Delhi: In the first nine years of the Modi government, India pulled almost a quarter of a billion people out of poverty, as measured by access to basic services, a new discussion paper from the country’s state-run think tank said Monday.

In 9 years, 248mn pulled out of multidimensional poverty: Niti Aayog paper

India’s so-called multidimensional poverty fell from 29.17% in 2013-14, when the Modi government assumed power, to 11.28% in 2022-23, which is equivalent to nearly 248 million escaping deprivation, the estimated from Niti Aayog’s paper showed, with much of the gains in traditionally high-poverty Hindi-speaking states, which account for the largest cuts in the number of people with severe disadvantages. For instance, Uttar Pradesh topped the list of states, with 50.94 million people estimated to have escaped dire living conditions according to the study.

To be sure, to assess deprivation levels in 2013-14 over 2022-23, the authors – Niti Aayog member Ramesh Chand and senior adviser Yogesh Suri – used projections of poverty due to data limitations for some specific periods. The Niti Aayog paper used, with technical assistance from the UNDP, the internationally acclaimed Alkire-Foster method of counting the poor. This was developed by the Oxford Poverty and Human Development Initiative’s Sabina Alkire and James Foster and is based on the key idea that poverty is not merely a lack of sufficient income, but chronic deprivation of access to adequate healthcare, education and decent living conditions.

According to the paper, the number of people escaping multiple disadvantages is highest in Uttar Pradesh, followed by Bihar at 37 million and Madhya Pradesh at 23 million.

As a result of the decline in the poverty headcount ratio, India is likely to achieve its Sustainable Development Goals target of halving multidimensional poverty well before he deadline of 2030, the paper said.

Although India’s National Multidimensional Poverty Index constructed by Niti Aayog uses the Alkire Foster methodology, it is slightly broader. The National MPI covers 12 indicators while the global MPI of Alkire Foster covers 10. These include health, education and standard of living.

“Income in itself is necessary, but not sufficient to improve the condition of people and the MPI index has precisely taken this perspective to understand how it has effected people in sectors like education, health and standard of living,” said author Chand .

The health dimension includes nutrition and child and adolescent mortality indicators, while the education dimension includes years of schooling and school attendance. The standard of living dimension includes six household-specific indicators, namely, housing, household assets, type of cooking fuel, access to sanitation, drinking water and electricity. All 12 indicators of MPI have shown remarkable improvement during this period, the paper stated.

“The ultimate objective of MPI is leaving no one behind and complements the government’s motto of saabka saath, sabka vikas (inclusive development),” said Niti Aayog CEO BVR Subrahmanyam.

Last year, Niti Aayog said multidimensional poverty in India had decreased from 24.85% in 2015-16 to 14.96% in 2019-21 based report on the National MPI released on July 17. This was equivalent to lifting an estimated 135 million people out of multidimensional poverty according to population projections used by the report.

Praising the achievements, Prime Minister Narendra Modi posted on the social-media platform X, formerly known as Twitter: “Very encouraging, reflecting our commitment towards furthering inclusive growth and focusing on transformative changes to our economy.”

The paper also found that the pace of decline in poverty headcount ratio was much faster between 2015-16 and 019-21 (with a 10.66% annual rate of decline) compared to period 2005-06 to 2015-16 (which had a 7.69% annual rate of decline).

“My feeling is that the drop in multidimensional poverty in the Uttar Pradesh, Bihar and Madhya Pradesh is not surprising because these are low-base states. The returns to public expenditure must have seen a structural shift upwards under new institutions and mechanisms,” said economist NR Bhanumurthy, vice-chancellor of Dr. B.R. Ambedkar School of Economics University, Bengaluru. “Centrally sponsored schemes are being implemented in a much more efficient way.”