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"When the government violates the people's rights, insurrection is, for the people and for each portion of the people, the most sacred of rights and the most indispensable of duties."

Poverty estimates in our country are derived from the household consumer expenditure data collected by National Sample Survey Organisation (NSSO) every fifth year. Household consumer expenditure surveys are also conducted annually but the sample size is much smaller. Planning Commission does not take cognizance of these annual surveys. Everyone eagerly awaited the quinquennial survey results for the year 1999-2000 (55^th round) for an authentic picture of the poverty trend during the decade of economic reforms. The quinquennial survey of 1993-94 and the annual surveys through out 90s indicated that the declining trend in poverty ratio achieved during 80s, was halted (reversed?) in the reform era. The reform lobby was uncomfortable with the annual surveys and insisted that rigorous poverty estimate could only be obtained from the quinquennial surveys of large sample size.

The 55^th round results (1999-2000) took everyone by surprise. The poverty ratio came down from 36% in 1993-94 to 26% in 1999-2000 - 10% decline in just 5 years. The reform programme of the government was a magic wand. Did it actually physically annihilate the poor and the marginalised?

The reported numbers on farmers’ suicides, the starvation deaths, victims of communal riots, dalits killed by the upper castes and the tribals killed in police firing are indeed alarming for any civilized society.

The 55^th round survey results created a serious controversy with respect to reference period. The NSSO has been collecting consumer expenditure data on the basis of a uniform 30-day recall period since 1950s. There had been a persistent clamor that one-month recall period was too long and the expenditure on food got underreported. NSSO responded by changing the reference period. In the 55^th round, the consumer expenditure for food, pan, tobacco, etc. was recorded for two reference periods, one- week recall and one-month recall. The reference period for clothes, consumer durable etc. was 365 days and for other items it was one month.

The changed reference period increased the expenditure estimates and reduced poverty figures in one stroke. Such drastic reduction in poverty raised a big uproar. The 1999-2000 figures of headcount poverty ratio could not be accepted especially in view of the annual survey results and in view of the trends shown by other variables closely related to poverty. The experts (pro and anti globalization) argued about the rigour of monthly and weekly recall period and ultimately agreed on one point. The 1999-2000 poverty estimates were not comparable with 1993-94 estimates. Hence, no inference could be drawn regarding impact of reform on poverty.

The experts are civilized people. In this world fraught with violent conflicts, they have learnt to live in harmony with ‘notes of dissents’ to protect their honour. However, if they were to face a group of class 10^th or 1^st year students, who are particularly encouraged to ask questions, then it is not unlikely that one of them will stand up and ask:

Q.      “ What exactly is the meaning of 36 % or 26% poverty in the country?”

The expert will answer,“ It is the percentage of population which lives below the poverty line.”

Q.         & #8220;What is ‘poverty line’?”

A.         & #8220;It is Rs. 327 per month per capita for rural India and Rs.454 per month per capita for urban India for the year 1999-2000.”

Q.         & #8220; How are they obtained?”

A.         & #8220;The Planning Commission updates the ‘poverty lines’ for the year 1973-74 according to relevant price indices”

Q.         H ow were the poverty lines for the year 1973-74 computed?

A.         & #8220;The planning commission identified the expenditure group from the NSSO consumer expenditure data, whose expenditure on food fulfilled the calorie norms. The average per capita per month expenditure of this group was fixed as the ‘poverty line’. The poverty line was Rs. 49 for rural areas and Rs. 56.6 was for urban areas.”

Q.         & #8220;What were the calorie norms?”

A.         & #8220;For rural India, it was 2400 Kcal per capita per diem and for urban India it was 2100 Kcal per capita per diem.”

Q.         & #8220;What were the poverty ratios in 1973-74?”

A.         & #8220;The poverty was 56.4% in rural areas, and 49% in urban areas.”

Q.         & #8220;Does it mean that in 1973-74, 56.4% population in rural areas did not have sufficient purchasing power to afford 2400 Kcal and 49% population in urban areas could not afford 2100 Kcal?”

A.         & #8220;That is correct.”

Q.         & #8220;Does it mean that we have made considerable progress in 25 years and in 1999-2000 only 27% of our rural population cannot afford 2400 Kcal?”

If the expert is bothered about rigour and truth, he/she cannot answer this question in affirmative. According to NSSO 55^th round data the rural poverty line of Rs.327 in 1999-2000 corresponds not to 2400 Kcal but to 1868 Kcal. The rural poverty line, which would correspond to 2400 Kcal, is Rs. 567 and the corresponding poverty ratio is 74.9%. Thus in 1999-2000, 74% of our rural population cannot afford 2400 Kcal.

The expert may find this statistics too uncomfortable and may like to end the conversation. However, if these figures are given to the student, he will easily infer that either the definition of poverty should be revised or the poverty figures should be revised.

II

We present below the state wise poverty lines and poverty ratios obtained according to the planning commission definition of fulfilling 2400 Kcal and 2100 Kcal norms. These are juxtaposed against the official figures. Our estimates are only approximate. We neither had the requisite data nor did we attempt finer statistical adjustments to get more accurate estimates. Our intention here is only to bring home the wide divergence between the two sets of figures and thus point at the absurdity of official estimates.

The inconsistency in the government determined poverty lines and nutritional norms arise because the poverty lines computed in 1973-74 have been adjusted for the changes in price indices. Computing state level poverty lines according to state price indices has also accommodated the differing price trends in different states. However, the pattern of consumer expenditure is assumed to be constant. Neither inter state nor inter temporal differences in consumption pattern have been accounted for.

The expenditure pattern of the population has changed significantly both in rural and urban India. There is a shift in expenditure from food to non-food items. In the food basket, a shift is observed from cereals to non-cereals. This shift is observed over all expenditure groups even those at poverty line and below it. Thus, in 1973-74 the expenditure group at poverty line in rural areas spent 80% of its total expenditure on food. In 1999-2000, the expenditure group at rural official poverty line spends only 65% of its total expenditure on food. At the rural poverty line conforming the nutritional norms only 60% of total expenditure is spent on food. Obviously the poverty line updated for price alone will be unable to meet the calorie requirements.

III

There are two ways in which researchers define poverty: relative poverty and absolute poverty. Relative poverty means bottom 10% or 20% or 30% of the population, which cannot participate in the desirable patterns of life that exist in a given society at a given time. Absolute poverty, however, refers to a situation in which a person lacks those things that help to sustain human life. It refers to the basic human needs, such as food, shelter and clothing. Generally relative poverty is considered relevant for societies where everyone has attained a certain minimum level of living and people have higher aspirations from life. For a poor country absolute poverty is more relevant.

If our experts have decided that poverty in India is to be viewed in relative terms i.e.30% or lower, then the official estimates are always right and there is no need to bother about definition of poverty in terms of absolute norms.

However, if we accept that people have not yet got the basic minimum required for a dignified human life, then we must set explicit norms for the basic minimum. In 1978, the task force appointed by the planning commission defined poverty line as the actual expenditure of the expenditure group, which spends enough on food to fulfill the normative calorie requirements. Norms were thus fixed only for the food components. No norms were fixed for the nonfood items like clothes, housing, education, and health etc. Many of us have argued time and again that dignified living standards must include norms with respect to all the above items and more.

In this context, we look at the consumption patterns in rural India of the expenditure groups at the official poverty line and at the poverty line, which corresponds to the calorie norms.