India’s poverty debate needs to move on: Let’s adopt new norms

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column in this paper on 27 March 2024. None of these discussions, however, examined the appropriateness of the existing methodologies for tracking poverty using consumption data. Consumption-based poverty measurement in India traces its roots to a Working Group constituted by the Planning Commission in 1962, which was subsequently re-visited and revised by a task force in 1979.

This task force provided a careful description of the reasoning it employed to arrive at a poverty line for India. In brief, it defined the poverty line as a per-capita consumption expenditure level which could meet an average per capita daily calorie requirement of 2,400 Kcal in rural areas and 2,100 Kcal in urban areas, along with the associated quantum of expenditure on non-food items. This average calorie norm was based on an analysis of the demographic and activity-based composition of the population at that time.

The monetary value of this norm formed the basis of poverty lines in all subsequent revisions. However, the basic approach underlying this calculation was never seriously revisited until the Tendulkar and Rangarajan committees. Both of them noted that changes in the demographic and activity composition since the task force required changes in the calorie norm and expenditure level.

However, while they revisited the expenditure and nutritional dimensions of a poverty norm, they did not adequately address its non-food components. The essence of their argument was to assert that if spending in an expenditure class is adequate to meet nutritional norms, it will also be normatively adequate to meet the associated non-food components. The problem with this assumption is that India has changed significantly since the task force on poverty