Poverty and Public Distribution System; Part – I

Nagar had sent this article to me several months ago. Of late, I have not been paying much attention to Vrikshamandir. Since the beginning of this year, I have had some health issues. Now that the situation is fast normalising, I thought, what better way to start regular posting on Vrikshamandir than posting this from my dear friend and former colleague, Nagar. The second part of the article can be accessed by clicking the link.

This is my attempt to understand an ever-relevant issue. I am presenting my understanding in two parts. 

Part – I. Poverty?  How many poor do we have? 

There is a famous saying, “Empty mind is devil’s workshop”. And these days, the devil has a new pastime- surf the net. 

And when you surf the net, your best bet is “Google”. 

So, a couple of days ago, I decided to ‘Google’ on a subject that is global favourite- poverty. In fact we Indians are so obsessed with it that we have used it as a favourite political tool to win elections and stay in power. From ‘Garibi Hatao’ to ‘Garib Rath’ and ‘GaribiRekha’, we have seen it all. Whereas ‘Garib Rath’ perpetually reminded the entire route through which Lalu Yadav’s famous brain child ploughed that ‘we are poor and shall remain so’, the slogan ‘Garibi Hatao’ meaning ‘push poverty aside’ has always been and erroneously interpreted by the naïve Indian mind as ‘Garibi mitao’.

In fact our obsession with ‘Garibi’ is so high that ever since my childhood, I have heard our beloved country being referred as a‘Garib Desh’, as though this is a matter of national pride. 

And then comes the immortal ‘Garibi Rekha’ (poverty line). Successive governments have come out with programs and strategies to ‘alleviate’- not ‘eliminate’ poverty, simply because everyone knows that poverty is there to stay. It has been there ever since a societal structure emerged for a species called ‘humans’. My own view is that poverty always existed, is existing and will continue to exist. Poverty elimination, however well intentioned will always remain an Utopian concept and elude humanity.

My reasoning is simple- anything that is relative can not be eliminated and poverty is relative. However well off a person, if he is at the left end of the curve, he is poor. Whatever values you place along the X axis of a graph, those who are at the extreme left will always remain poor. Even a millionaire at the starting point of the curve on the left of a graph is as poor as the one who starts with a zero or 10 on another graph comparing wealth distribution. And however hard the managers of national economies the world over may try, they will find it impossible to flatten the curve as an index of equitable distribution of wealth.

And that is where the game of ‘poverty line’ begins. Politicians and economists on either side of the aisle become passionate when it comes to define the ‘poverty line’.. Economists try to define it, assign values and pamper their political masters by claiming that the poverty line has shifted – either up or down depending upon on which side of the aisle they are. 

Since economists always agree to disagree, I thought a common parameter which should be acceptable to all may be the ‘Ration Card’holding. Here again my reasoning is simple- those who can’t afford to buy basic foods at market price see in the holy ‘Ration Card’- the ultimate saviour from hunger. So in India, all Ration Cardholders must be necessarily poor. They must all be under the ‘poverty line’. 

How many poor do we have? 

In fact my attention was drawn on ‘Ration card’ when I came across this headline ‘67% population dependent on PDS for food’, in the Indian Express, November 9, 2020. If that is the percentage of population that is too poor to afford buying food grains at open market prices, then logically the poverty line should also be at 67%. Shouldn’t it? 

Here I would like everyone to remember that before the Aadhar Cardarrived on the scene, Ration Card was perhaps the most important document to prove your existence and Indian citizenship besides your entitlement to get subsidised supplies- food grains, sugar, edible oils, Kerosene etc. and of course, the cooking gas connection. Having a Ration Card, therefore became a ‘National necessity’. 

Official statistics on poverty line, however has a different story to tell Planning commission estimates of 2011-12 (as per TendulkarMethodology), the percentage of population below poverty line in India was 21.9%. (25.7- rural, 13.7 -urban) that need subsidised food grains under PDS. 

Let us have a quick look at how has the poverty line ‘behaved’ in the last few years. 

Year	Rural	Urban	Combined
2004-2005	42.0	25.20	37.2
2009-2010	33.8	20.9	29.8
2011- 2012	25.7	13.7	21.9

.

Source: India: population below poverty line (Source: RBI Website State wise data for the same years is given in appendix at the end of this blog.

Another source that compares the incidence of poverty across countries provides us with historical data over the years as under:

And now look at this: This shows India’s poverty rate from 1977-2022. This is based on the World Bank criteria of ‘percentage of population living on less than $5.50 a day at 2011 international prices.

Year	Under USD 5.5 per day	Percentage Change
2011	87.40	-3.70
2009	91.10	-1.80
2004	92.90	-2.60
1993	95.50	-0.20
1987	95.70	-0.90
1983	96.60	-0.50
1977	97.10

Source: Macrotrends.net

So, a decline in poverty rate of just 10.30%  in 34 years, that is 0.30% per year! How marvellous! So much for the much touted national programs to eradicate poverty. Wasn’t the slogan ‘GaribiHatao’ given in 1977? Just asking! 

India’s poverty rate for 1977 was 97.10% and it declined to 87.40% in 2011. Sources quoted earlier, however show population below poverty line as 21.9%. Which one is right? 

And as though this is not enough to confuse us on how many really poor do we have, here is another one from ‘Poverty rate in India: Global statistics:

“India is no longer the country with the most extreme poverty, states the Brookings report. In the global poverty ranking, India is sliding down. As per the real-time data from World Poverty Clock, 7% of theIndian population are living in extreme poverty and 0.6 Indians are escaping extreme poverty every minute.

(Meaning of Extreme Poverty: Individuals who are without income, home, health, or food twice a day. Also, people who are bedridden, no facility to make and eat food, having debts due to health ailments comes under the list of extreme poor category).

So, I guess it would be reasonable to assume that our poor population is anywhere between 7% to 67% depending upon how and with what agenda  we want to view Indian poverty. Most politicians would want to or rather love to view poverty at 67% as it gives them a platform to vociferously advocate continuation of highly subsidised PDS program and honour their election promise of providing Wheat, Rice and coarse cereals at ₹ 3,2 and 1/kg through a network of nearly 550,000 ration shops in the country.