Divergent Perspectives on Poverty in India: Contrasting Inferences by NITI Aayog and Oxfam

The findings of the NITI Aayog used baseline data of NFS (2015-16) and NFS (2019-21) to arrive at the conclusions.
Niti Aayog
Niti Aayog Internet

New Delhi- Poverty in India remains a complex and multifaceted issue, and reports by two prominent organizations, NITI Aayog and Oxfam, offer contrasting perspectives on the state of poverty and inequality in the country. While NITI Aayog's recent report Multidimensional Poverty Index suggests a significant reduction in poverty levels, Oxfam's survey on wealth inequality presents a more somber picture. Examining these differing narratives provides valuable insights into the multidimensional nature of poverty in India and prompts a critical examination of the country's progress in addressing economic disparities.

NITI Aayog released its Multidimensional Poverty Index on Tuesday. The report claimed a massive reduction in poverty between 2015-2016. Some of the key highlights of the report are:

  • Over 135 million people moved out of multidimensional poverty in a period of five years between 2015 and 2019-21.

  • Only 14.96 percent of the people were poor in 2019-21 based on the multidimensional index employed by the Aayog against 24.85% in 2015-16, a decline of around 10% approximately.

  • Only 5.27% of the people in urban areas were poor in 2019-21 against 8.65% in 2015-16.

  • Rural poverty declined at the fastest rates as the number of poor reached 19.28% against 32.59% earlier, a reduction of 13.3% approximately.

  • Uttar Pradesh accounted for the maximum reduction in poverty as the state managed to lift 3.45 million people out of poverty in the period.

The findings of the NITI Aayog used baseline data of NFS (2015-16) and NFS (2019-21) to arrive at the conclusions. The Multidimensional Poverty Index considers three dimensions: health, education, and standard of living. These dimensions have three indicators like nutrition, child and adolescent mortality, years of schooling, school attendance, cooking fuel, sanitation, drinking water, electricity, bank accounts, and assets.

Niti Aayog
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OXFAM: Survey accentuates the inequality in India

In contrast to this, the "Survival of the Richest: The India Story" released by Oxfam International on the first day of the World Economic Forum annual Meeting at Davos paints a quite dismal picture of wealth inequality in India. Some of the concerning figures of the report are:

  • The top 1% of the population owned more than 40.5% of its total wealth in 2021.

  • 5% of Indians own more than 60% of the country's wealth, while the bottom half of the population (700 million people) together share just 3% of wealth between 2012 and 2021.

  • In 2017, 73% of the wealth generated went to the richest 1%.

  • The top 10% of the Indian population holds 77% of the total national wealth.

  • 670 million Indians who comprise the poorest half of the population saw only a 1% increase in their wealth.

  • The number of hungry Indians has increased from 19 crores to 35 crores.

  • Gender inequality in India was also skewed, with females earning only 63 paise for every 1 rupee earned by male workers.

  • Scheduled castes and rural workers fare worse as they earned 55% of what the advantaged groups earned respectively between 2018 and 2019.

Gender and Social inequality

The report shed light on the presence of gender and social inequality in India. It revealed that gender disparity was pronounced, with women earning only 63 paise for every 1 rupee earned by male workers. Additionally, scheduled castes and rural workers faced even greater challenges, as their earnings amounted to only 55% of what the more advantaged groups earned between 2018 and 2019. The report emphasized that marginalized communities, including Dalits, Adivasis, Muslims, women, and informal sector workers, bear the brunt of a system that prioritizes the survival of the wealthiest. It further proposed that levying taxes on the ten richest individuals could generate sufficient funds to reintegrate children into the education system.

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