Thaindian News

New Delhi, Jan 28 (IANS) India’s high growth has helped upgrade the living standards of its people, but is not sufficiently broadbased to reduce poverty in absolute levels, says a report of a UN agency released Thursday.
“In recent years, economic growth has been relatively high in three largest countries in the region, India, Bangladesh and Pakistan, which recorded annual growth per capita above 5 percent in 2000-2006,” according to “Rethinking Poverty” report of the UN’s Department of Economic and Social Affairs.

“As a result, the sub-region saw the proportion of those living in extreme poverty decline in relative terms, from a high of 59 percent in 1981 to 40 percent in 2005,” it said.

“However, such growth has not been sufficiently inclusive and pro-poor to reduce the absolute numbers of people living in poverty. Income inequalities have grown steadily in India since the 1980s, in borh urban and rural areas.”

Giving some examples, the report says the levels of poverty varied significantly within India where Andhra Pradesh, Karnataka, Kerala and Tamil Nadu saw the share of poor decline from 18 percent in 1993-94 to 15 percent in 1999-2000.

At the same time, the share of the total number of poor in Bihar, Orissa, Madhya Pradesh, Uttar Pradesh and West Bengal jumped from 57 percent to 63 percent during the same period.

“Therefore, although there has been a steady decline in the incidence of poverty in India, the efforts of the government have not resulted in a uniform impact across regions. There remain regions where poverty is still deep and severe and hence require greater attention.”

The other highlights of the report:

- The poverty line is supposed to be principally defined in terms of the money income needed to avoid going hungry. Yet, official trends in global poverty and hunger have been going in the opposite direction since the early 1990s.

- Measured globally, the number of people living in extreme poverty (now defined by the World Bank as less than $1.25 per day for 2005) declined from 1.9 billion in 1981 to 1.4 billion in 2005. But if China is removed, the number of people living in extreme poverty actually increased over this period, from 1.1 billion to 1.2 billion.

- The most direct pathway out of poverty is generating enough decent work opportunities. Yet, the creation of productive jobs has failed to receive the prominence it deserves.

- World Bank studies do not point to significant employment due to trade liberalisation.

- Public social expenditures should be protected, even increased, in the face of crises, with priority given to primary health care, universal basic education and social provisioning.

- Studies have demonstrated that privatisation had harmed the poor, either through loss of employment and income or through exclusion from basic services. At the same time, weak governance and regulatory capacity in many developing countries led to the poor control of market abuses by private companies.

- Tax ratio percentage in many developing countries is in single digits whereby the fiscal capacity of the country for investing in the sector is hampered.

- As both economic development and reducing inequality contribute to poverty reduction, public policies should be oriented towards ensuring equitable and sustainable development rather than targeted poverty alleviation programmes which cost much more.

- Neither macroeconomic recovery nor growth necessarily translates into poverty reduction. Consequently, many governments and development agencies have created or supported various programmes to reduce poverty, involving micro-credit, land titling or even “bottom of the pyramid” marketing to the poor.