80% of Indians live on less than $2 a day: World Bank

What does it mean to be poor? It depends on which set of figures you consult.

“India is a bit of a curious case because it is one of the few countries in the world where the $1 (Rs39.3) a day poverty line is much higher than the national poverty line,” said Rinku Murgai, a senior economist in the World Bank’s New Delhi office.

The difference between those that qualify as extremely poor according to World Bank standards versus government standards has been a cause for debate among some government officials and the development community.

By World Bank estimates, 80% of India’s 1.1 billion people live on less than $2 a day, meaning more than one-third of the world’s poor live here. One in three Indians lives on less than $1 a day, meaning they qualify as extremely poor, according to the bank. The government says that, on average, those who earn less than Rs356 per month (less than $9) in rural areas and Rs538 a month in cities are poor, but the actual line varies from state to state.

Though overall poverty rates are falling when measured by both the World Bank and the government, India may miss a target set by the United Nations as part of the Millennium Development Goals to halve the number of people living on less than $1 a day from 1990 levels by 2015, according to a report released last week by the UN in partnership with the Asian Development Bank. The country has also achieved less than half the targets to cut hunger in half according to a recent study by the US-based International Food Policy Research Institute.

“India is such a diverse country that aggregates and averages can never adequately describe the depth of poverty,” says Abusaleh Shariff, chief economist and head of the human development programme at the National Council of Applied Economic Research.

“In many ways poverty estimates are just an artificial wall. What matters is the quality of life on $1 a day or $2 a day or whatever line you choose,” he adds.

A closer look at the extreme poor shows some clear patterns: they are often members of marginalized communities, such as scheduled tribes and Muslims; and indicators such as anaemia and illiteracy are high among them, which means these people have little chances of climbing out of poverty, according to analysts.

On Wednesday, the midpoint for the Millennium Campaign, activists around India will hold thousands of events as part of the “Stand Up, Speak Out” campaign, a joint effort of the UN Millennium Campaign and the Global Call to Action Against Poverty, which is hoping to break a world record by having more than 23.5 million people turn up at demonstrations that urge governments to honour their anti-poverty commitments and meet the Millennium Development Goals targets.

“They may fall through the gaps and when it comes to them, there may be lapses in programmes, but [today] we can help them raise their voices,” says Sharad Joshi, secretary of Jaipur-based Centre for Community Economics and Development Consultants Society, which organized more than 300 events in several states focusing on marginalized communities.

The quality of life for many of the poor is highly dependent on where they live and which community they belong to, with the vast majority of the nation’s poor located in a handful of states and members of scheduled castes and tribes, Muslims and women being among the poorest in the country.

Government schemes to counter poverty such as the National Rural Employment Guarantee Programme haven’t had a big enough impact in places where they are most needed, say grass-roots aid workers.

“The implementation is still uneven and doesn’t do enough to counter the need to migrate for work,” says Praveer Peter, a convenor of the Ranchi-based Gender, Livelihoods and Resources Forum, which works in Jharkhand, Chhattisgarh and Orissa, where poverty rates are high and health indicators are dim. “Social security schemes for the unorganized sector are also necessary.”

Meanwhile, the performance of some Indian states on several developmental parameters compares poorly with that of poorer countries.

“We need to figure out why it is—though there has been a lot of progress—(that) immunization rates and rates of child malnutrition are comparable to some of the poorest countries in sub-Saharan Africa in some states” of India, says the World Bank’s Murgai.

To that end, the international agency’s New Delhi office recently began work on a study of poverty and inequality in India that is likely to be released in 2009, she said.

Aside from addressing regional disparities, improving the quality of education and not just access to it is key to maintaining the nation’s economic growth targets and alleviating poverty, according to Shariff.

“If you have education, it doesn’t matter where you live,” he says, with educated households less likely to be poor than their uneducated counterparts.

Despite the fact that India has successfully increased primary school enrollment targets and is on track to meet UN Millennium Development Goal targets in this area, the quality of education remains questionable in many places, he says.

Among children aged 8-11 enrolled in school, more than one in 10 can’t read at all, 14% can’t read letters, one in five can’t read words, and close to 40% can’t read a one-page story.

“The moment you use the word quality, you need to ask how many can read or write a single line and understand it,” he says. “That’s troubling because education can be one of the strongest factors for poverty alleviation.”

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