He said “I hunt for haddocks’ eyes
Among the heather bright,
And work them into waistcoat buttons
In the silent night.
And these I do not sell for gold
Or coin of silvery shine,
But for a copper halfpenny,
And that will purchase nine.

                                                     
             – Lewis Carrol


What does it mean to be poor in India? Well, it depends on who you ask. Till 2004 the poverty line was defined by calorific intake. If you consume less than 2400 kcal in rural India, or 2100 kcal in urban India you could officially be considered poor. There are a couple of problems with this definition, aside from the fact that by that rule most Bollywood starlets would qualify as poor.  Basic needs like housing, healthcare, transportation and the costs of educating either yourself or your offspring, are not included. In other words, unless you were starving, you weren’t poor. Carl Haub and O.P. Sharma of the Population Reference Bureau wrote an excellent article last year, which covers some of the salient points in this debate. What I found most interesting about the article was this chart, which I have inserted below.

The Number of Indians Living Below the Poverty Line

Source: Population Reference Bureau

    
Depending on which criteria you choose to employ, India has between 328 million and 903 million poor citizens. A difference of a mere 600 million. If we accept the current official figure, then India has more poor people than the population of the United States. While this is a sobering thought, that’s just under 30% of the total population, and we seem to have made progress since the 1970s when that figure was closer to 56% . If we accept the Arjun Sentgupta Commission’s definition, the number of poor people in India is marginally smaller than the combined populations of the US, Indonesia, Brazil and Pakistan, which are the most populous countries after China and India. If the enormity of the problem has not sunk in yet, and for many of us cognitive dissonance will begin to take over, 903 million people in India, roughly 77% of the population, have access to the vote (theoretically) but don’t earn enough to feed themselves.

The National Commission for Enterprises in the Unorganised Sector headed by Arjun Sengupta, more often referred to eponymously, published its report on the living and working conditions of workers in the unorganised sector in India in 2007. This report found, amongst other things, that an estimated 77% of the population lived on less than INR 20 ($0.45) a day (2004-05 prices). Even 6 years ago, twenty rupees would have bought you two meals of questionable nutritive value and little else.  It is this figure that the Planning Commission of India, which guides national economic policy, submitted to the Supreme Court as the poverty line. In other words anyone earning above INR 20 a day in urban India, or INR 15 in rural India cannot be considered poor. The Planning Commission report assumes that the average city dweller can get by on a monthly budget of  INR 578 ($13), with an expenditure of INR 31 ($0.70) on rent, INR 18 ($0.40) on education and INR 25 ($0.55) on medicines for the month. Let’s just take the average rent figure. According to the most recent National Sample Survey conducted (2008-09) the average rent in urban India is about INR 1000 ($22) for a lease without a contract (informal) and INR 1800 ($40) for a contractual lease (formal). To use an americanism, that’s not even in the same ballpark.     

The Indian Government has obvious reasons for wanting to define the poverty line as low as possible. Aside from making it look like their policies have been more effective than may actually be the case, it reduces the burden on the public exchequer with regard to the provisions of the Food Security Bill. The Bill mandates that every Indian living below the poverty receive subsidized foodgrains. The governments rationale is that given the measly 1% of GDP allocated to the food subsidy, it is better to concentrate on the poorest. Or in other words, let us try and change the definition of poverty so that we can pretend we are doing our best to solve the problem.