11/20/2014

Bankers Adda: SBI PO: Essay on "The poverty line - how should it be defined?"

Essay on "The poverty line - how should it be defined?"

Hello Readers,
In view of the upcoming SBI PO Exam 2014, here we are presenting to you
an essay on "The poverty line - how should it be defined?" Hope you like the
post!

India since independence has achieved a lot in the term of GDP growth, per
capita income, and in other economic index but it still has a very big portion
of population living under poverty line. Generally the populations below the
poverty line are considered as the people who can't afford their basic daily
requirement.
Modern economists define the poverty line in various ways. Planning
commission of India has periodically defined the poverty line. A committee
was constituted under the chairmanship of Prof. Suresh. D Tendulkar, to
review the methodology for estimation of poverty line for the period 2004-2005
and 2009 - 2010.
Tendulkar used implicit prices derived from quantity and data collected in
household consumer expenditure surveys to compute and define the poverty
line. Tendulkar's report says a person was considered above poverty line if
he/she earns Rs 22.44 per day in rural area and Rs 28.65 per day in urban
areas. According to Tendulkar's committee 21.9% Indians were considered
below poverty line in the year 2011 - 2012.
This figure of poverty line defined by Prof Tendulkar is contested by many
people. It is being said; in the age of high inflation fixing this poverty line is
ludicrous. These days one needs at least Rs 30 for a single meal and a
person's calorie requirement can't be met by a single meal. Beside food, there
are other requirements like cloths, shelter etc. So the amount suggested by
Prof. Tendulkar to define poverty line is untenable.
The definition given by Tendulkar received a lot of criticism. So the Planning
Commission constituted an expert group headed by noted economist C.
Rangarajan to review the Tendulkar Committee. The committee that was
constituted to find the correct measure to define the poverty line has still to
submit its report.
Meanwhile, a report on Indian states by current RBI governor Raghuram
Rajan is being considered to define the poverty line. Rajan has categorized
the states on composite index on the basis of 10 equally weighted indicators
for monthly per capita consumption expenditure, education, health, household
amenities, poverty rate, female literacy, percentage of the Scheduled
Caste/Scheduled Tribe population, urbanization rate, financial inclusion and
physical connectivity.
There is however no consensus on this definition. In its absence we need to
give a new definition to poverty. Every individual should be considered poor
or below poverty line who can't fulfill all his/her basic requirement of life. A
person must have enough earning so that he/she can afford two times meal
to remain healthy and have cloths to wear. Besides, fulfill other bare minimal
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11/20/2014

Bankers Adda: SBI PO: Essay on "The poverty line - how should it be defined?"

needs for survival.

In the term of individual's poverty calculation, it can be considered as
monthly consumption expenditure capability, expenditure on education,
health, household amenities, etc. Imbalance in any of these should be
considered as a point of poverty for the individual.
Poverty should never be measured on the basis of family income. As every
individual have specific requirement. In the patriarchal Indian society, it is
high time to consider every woman individually and she should never be
considered dependent on other family members.
Poverty line should not merely consider as income level but also the
availability of resources for daily requirements. If an individual falls short in
them he/ she should be bracketed under the poverty line.

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