Poverty and inequality

Poverty and inequality

According to the paper titled: "The State of the Poor: Where are the Poor and Where are the Poorest?" (2013) by Pedro Olinto and Hiroki Uematsu, using data released in the latest World Development Indicators,

•    India accounts for one-third (up from 22 percent in 1981) of the world poor in 2010 and China comes next contributing 13 percent (down from 43 percent in 1981). People living on less than USD 1.25 (about Rs 65) per day are considered as poor.

•    1.2 billion persons still living in extreme poverty across the world.

Using past studies, the Report of the Expert Group to Recommend the Detailed Methodology for Identification of Families Living below Poverty Line in the Urban Areas, Planning Commission 2012, Perspective Planning Division, http://www.im4change.org/docs/655rep_hasim1701.pdf has found:

•    A comparison of the Gini coefficient* (a measure of consumption inequality) estimated on the basis of MPCE data provided by the NSSO using the Uniform Recall Period (URP) Consumption method indicates that the extent of inequality in the consumption expenditure is higher in urban areas as compared to the rural areas. The Gini ratio for rural areas declined from 0.30 in 2004-05 to 0.29 in 2009-10 and for urban areas it increased from 0.37 to 0.38 during the same period.

•    Rural Gini started declining from 1977-78 till 1993-94, it rose by 0.02 points during 2004-05 and again declined by 0.01 points in 2009-10. However urban inequality has been increasing almost steadily over the years. Urban Gini rose from 0.27 in 1973-74 to 0.34 in 1977-78 to 0.38 in 2009-10. Compared to the same Gini ratio of 0.34, for both rural and urban areas in 1977-78, the gap between them rose to as high as 0.09 points in 2009-10.

•    According to the 65th round of the NSSO** in 2008-09, about 49 thousand slums were estimated to be in existence in urban India in 2008-09, 24% of them were located along nallahs and drains and 12% along railway lines. For 95% slums, the major source of drinking water was either tap (usually public tap) or tubewell. About 73% notified and 58% non-notified slums had a motorable approach road. About 10% notified and 23% non-notified slums did not have any drainage facility. Only 1% notified and 7% non-notified slums did not have electricity connection. About 78% of notified slums and 57% of the non-notified slums had a pucca road inside the slum.

•    A study by the National Institute of Urban Affairs (NIUA), quoted by the National Commission on Urbanisation (NCU), 1988 (ibid.), points out that 68 per cent of the urban poor are women, who are socially treated as expendable and entitled to the poorest nutrition and health care. Single women headed households and girl children are particularly assailable in these circumstances.

•    According to NIUA survey, the 15 most dominant occupations of the poor are: weavers (8.3 per cent), sweepers (6.5 per cent), unskilled labourers (6.3 per cent), street vendors (5.4 per cent), construction workers (5.3 per cent), rickshaw pullers (5.3 per cent), peons (4.1 per cent), domestic servants (3.5 per cent), petty shopkeepers (3.2 per cent), agricultural labourers (3.0 per cent), rag pickers (2.8 per cent), bidi makers (2.7 per cent), drivers (2.6 per cent), petty salesmen (2.2 per cent), and clerks (1.9 per cent).

•    The 2009 National Commission for Enterprises in the Unorganised Sector (NCEUS) report estimates that an overwhelming proportion of workers belonging to the poor and vulnerable groups (between 94% and 98%) are informal workers, while they constitute a much smaller proportion of the work force in the middle or higher income groups. The growth rate of employment also was much less among the poor and vulnerable groups compared to the Middle and Higher income groups. In other words, both in terms of quantity and quality of employment, the poor and vulnerable groups had been lagging far behind the others during the period of rapid economic growth (1993-2004).


* A Gini of zero denotes absolute equality, while a value of 1 (or 100 on the percentile scale) means absolute inequality

** Ministry of Statistics and Programme Implementation,Government of India. 2009. ‘Some Characteristics of Urban Slums’. National Sample Survey Office, National Statistical Organisation. Report No. 534(65/0.21/1)

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