Topic 16 poverty(ii)

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Topic 16 poverty(ii)

  1. 1. Poverty Alleviation:Indian Food Security Oriented Approach M.H. Suryanarayana surya@igidr.ac.in
  2. 2. Outline of Presentation • Food Security Oriented Strategy: A PolicyMotivation Imperative • Macro dimension: Estimates, ResourceConceptua Imperatives & Choice of Development Strategies lization • Micro dimension: Programmes for Poverty Alleviation subject to Macro Constraints • Development Puzzles and Policy DilemmasEvaluation 9/2/2012 surya@igidr.ac.in 2
  3. 3. Policy Imperative• Colonial rule & consequences: – Only Law & order & Tax collection – No Development Expenditure – Abysmal living conditions: • Stagnant real income and food production (first five decades of 20th Century) • High illiteracy (84%); mortality rate (27.4 per 1000)9/2/2012 surya@igidr.ac.in 3
  4. 4. Conceptualization• Evolution constrained by information base• Macro Perspective with micro foundations:• Pre-Independence Era: • (i) Naoroji (1901)„Poverty and Un-British Rural India‟: • Income generated insufficient to meet the „necessary consumption‟ of the population • (ii) National Planning Committee (1938): Emphasis on multiple dimensions9/2/2012 surya@igidr.ac.in 4
  5. 5. National Planning Committee (1938)Ten-year Plan Targets for Multiple dimensions:i. Balanced Diet of 2400-2800 kilo calories per adult worker;ii. Improvement in clothing from 15 yards to at least 30 yards per capita per annum;iii. Housing: at least 10 square feet per capita;iv. Liquidation of illiteracy;v. Increase in life expectancy; andvi. Access to adequate medical facilities.9/2/2012 surya@igidr.ac.in 5
  6. 6. A Decade of Planning: Outcome Evaluation• Income Distribution Committee (1962)• Working Group on Poverty: – Poverty line: Rs 20 per capita per month at 1960/61 prices. – Provide for a balanced diet as per the Nutrition Advisory Committee of the Indian Council of Medical research. – Excluded expenditure on health & education to be provided by the State. – To get food to meet minimum energy requirements for an active and healthy life and also minimum clothing and shelter.9/2/2012 surya@igidr.ac.in 6
  7. 7. Conceptualization: Post Independence era• Official Indian definition of „Poor‟: – “Those whose per capita consumption expenditure lies below the midpoint of the monthly per capita expenditure class having a per capita daily calorie intake of 2400 calories in rural areas and 2100 in urban” – Food (cereals) - a major source (85%) of calories; hence, emphasis on food9/2/2012 surya@igidr.ac.in 7
  8. 8. Food Energy Intake Method Food Energy Intake Min Calorie Intake ( 2400 Kcal.) PL Household Consumer Expenditure9/2/2012 surya@igidr.ac.in 8
  9. 9. Expert Group (1993):• Endorsed the poverty norm anchored in a minimum calorie requirement• Distinguished between issues of under-nutrition and measurement of poverty9/2/2012 surya@igidr.ac.in 9
  10. 10. Incidence of Poverty (million): 1983-2004 251.96 244.03 220.92 76.34 80.80 70.94 1983 1993 2004 Rural Urban9/2/2012 surya@igidr.ac.in 10
  11. 11. Conceptualization: New Millennium• Economic Reform Era: Bleeding rural India• Policy response: Expert Committees• Poverty line: – Delinked from the calorie norm – Social perception of deprivation of basic needs – Validates with reference to calorie norm – Provides for a budget share of 54% for food – Poverty estimate of 37% - a case for Right to Food Act9/2/2012 surya@igidr.ac.in 11
  12. 12. Policy Choices9/2/2012 surya@igidr.ac.in 12
  13. 13. Composition of Rural Households (1983) 10.31 6.57 40.72 Self Eemploy Ag Self Empl NonAg 30.7 Agr Labour Other Labour Other Rural 11.79/2/2012 surya@igidr.ac.in
  14. 14. Composition of Rural Unemployment (1983) 5.43 16.32 10.21 8.5 Self Eemploy Ag Self Empl NonAg Agr Labour Other Labour Other Rural 59.549/2/2012 surya@igidr.ac.in
  15. 15. Composition of Rural Poor Households (1983) 6.17 5.99 32.04 Self Eemploy Ag Self Empl NonAg Agr Labour 45.59 Other Labour 10.29 Other Rural9/2/2012 surya@igidr.ac.in
  16. 16. Incidence of Poverty across Households Type (1983) 50 45.45 45 40 35 30.62 26.93 27.93 30 24.08 25 18.32 20 15 10 5 0 Self Eemploy Self Empl Agr Labour Other Labour Other Rural All Ag NonAg9/2/2012 surya@igidr.ac.in
  17. 17. Food Budget Share (%) (1972/73) 90 80 70 60 50 40 30 20 10 09/2/2012 surya@igidr.ac.in
  18. 18. Illiteracy (%) Across Expenditure Classes(1983) 90 80 70 60 50 40 30 20 10 09/2/2012 surya@igidr.ac.in
  19. 19. Development Strategy• Growth with Redistributive Justice: – Planning production by physical controls – Food insecure poor; hence, emphasis on food production & income generation• Three-pronged strategy: – Macro: Increase food availability through production (input subsidies for farmers) & imports – Meso: Food distribution programmes (PDS) (largely Urban sector to promote eco devt) – Micro: Income generating programmes9/2/2012 surya@igidr.ac.in 19
  20. 20. Strategy for Agricultural Growth• Green Revolution: – (i) Price support for output; (ii) input price subsidy; & (iii) PDS – Change in food grain production composition => increase in cost of calories – Increase in regional disparities – Increase in price dispersion worsened food security in remote rural areas => inevitability of PDS – Targeting Errors in income generating programmes9/2/2012 surya@igidr.ac.in 20
  21. 21. Economic Reforms• Adjustment with a Human Face• Options for PDS reform – dismantle; mean-based targeting; commodity-base targeting; food stamps/cash transfers• PDS evaluation – Targeting a Penalty on the Food Insecure9/2/2012 surya@igidr.ac.in 21
  22. 22. Identification for Targeting• Universal vs. Targeted Programmes• Universal: Self-selection of beneficiaries• Targeted: Economic status of the beneficiary – Targeted PDS with respect to • (i) occupational; • (ii) Household ; & • (iii) Social characteristics9/2/2012 surya@igidr.ac.in 22
  23. 23. BPL Census• Purpose: Classify rural households into BPL & APL categories• Criterion: – Census 1992: Income per household (RS 11000 / annum) – Census 1997: Two-stage procedure • 1st : Assets, durables & income • 2nd: Consumer expenditure (Poverty line) – Census 2002: • Indicators of quality of life & scores – Census 2009: Three Step procedure9/2/2012 surya@igidr.ac.in 23
  24. 24. Development Puzzles & Policy Dilemmas9/2/2012 surya@igidr.ac.in 24
  25. 25. Headcount ratio (per cent) 19 51 0 10 20 30 40 50 60 70 - 529/2/2012 53 -5 4 55 -5 6 57 -5 8 59 -6 0 Source: World Bank (1997) 61 -6 2 63 -6 4 65 -6 6 67 -6 8 69 -7 0 71 -7 2 73 -7 4 Yearsurya@igidr.ac.in 75 -7 Fig. 1: Rural Poverty 6 77 -7 8 79 -8 0 81 -8 2 83 -8 4 85 -8 6 87 -8 8 89 -9 0 19 91 93 -9 425
  26. 26. Fig. 2: Monthly Per-Capita Consumer Expenditure by the Poorest Decile Groups and Total 30 Population: All-India Rural 25 20Rs at 1960-61 prices 15 10 5 0 1983 1992 61-62 62-63 63-64 64-65 65-66 66-67 67-68 68-69 69-70 70-71 71-72 72-73 73-74 74-75 75-76 76-77 77-78 78-79 79-80 80-81 81-82 83-84 84-85 85-86 86-87 87-88 88-89 89-90 90-91 93-94 93-94 1960-61 Year Poorest Decile Group (PDG) 2nd PDG 3rd PDG 4th PDG 5th PDG Total Rural 9/2/2012 surya@igidr.ac.in 26
  27. 27. Average MPCE in different States 2004-059/2/2012 surya@igidr.ac.in 27
  28. 28. Average MPCE in different States 2004-059/2/2012 surya@igidr.ac.in 28
  29. 29. Nutrition based Poverty Trap? Macro evidence
  30. 30. Incidence of Calorie Deficiency (%) Norms: 2400 Kcal (Rural); 2100 Kcal (Urban) 79.880 75.8 74.2 71.1 70.1 67.870 66.1 64.8 65.9 63.9 63.9 60.5 57.1 58.1 58.26050 Rural40 Urban All India302010 0 1983 1987/88 1993/94 1999/00 2004/059/2/2012 surya@igidr.ac.in 30
  31. 31. Per Capita Calorie Intake by Deceile Group: All India Rural 4500 4000 3500 3000Kcals per diem 2500 2000 1500 1000 500 0 1972/73 1983 1993/94 1999/00 2004/05 Year 9/2/2012 Decile Group I II III surya@igidr.ac.in IV V VI VII VIII IX X Norm 31
  32. 32. Per Capita Calorie Intake by Decile Group: All India Urban 4000 3500 3000Kcals per diem 2500 2000 1500 1000 500 0 1972/73 1983 1993/94 1999/00 2004/05 Year Decile Group I II III IV V VI VII VIII IX X Norm 9/2/2012 surya@igidr.ac.in 32
  33. 33. Measures of Health Status9/2/2012 surya@igidr.ac.in 33
  34. 34. Infant Mortality Rate 90 85 (Deaths at age 0-11 months per 1,000 live births) 79 80 73 68 70 62 56 57 60 47 NFHS-1 50 42 NFHS-2 40 NFHS-3 30 20 10 0 Rural Urban All India9/2/2012 NFHS-3, India, 2005-06 surya@igidr.ac.in 34
  35. 35. Child Nutritional Status 60 (% children age under 3 years) 51 50 45 43 40 40 NFHS-2 30 23 NFHS-3 20 20 10 0 Stunted Wasted Underweight9/2/2012 surya@igidr.ac.in NFHS-3, India, 2005-06
  36. 36. Growth & Poverty Reduction: At what Cost?9/2/2012 surya@igidr.ac.in 36
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