Chronic Poverty Research Centre

CPRC at the UN CSD: making services work for the poorest

Presentation to the UN Commission for Social Development: making services work for the poorest by Professor Aasha Kapur Mehta of CPRC-India and the Indian Institute of Public Administration, New Delhi.

Poverty Eradication: The Goal

Poverty eradication and addressing the 'life time concerns' of our citizens, i.e., health, housing, education and employment were identified as the first of the five main priorities to be addressed through the Indian Budget 2003-2004.

The Finance Minister said that "For eliminating poverty, it is only reforms that result in sustained growth and high employment that are a durable solution and that the disadvantaged must be the first charge on our exchequer".

The MDGs refer to developing a global partnership for development so as to eradicate extreme poverty and hunger, achieve universal primary education, eliminate gender disparities in education, promote gender equality and empower women, reduce infant and child mortality, improve maternal health and reduce MMR, combat HIV/AIDS, malaria and other diseases, ensure environmental sustainability, halve the proportion of people without sustainable safe drinking water and achieve by 2020, a significant improvement in the lives of at least 100 million slum dwellers.

Taking the cue from the MDGs or goals for development and poverty eradication set at the UN General Assembly in 2000, to which we are a signatory, the tenth plan lists monitorable targets that include the reduction of poverty ratio by 5 percentage points by 2007 and by 15 percentage points by 2012, as also providing gainful and high-quality employment.

There is however a large chasm between

• vision statements, stated objectives and targets,
• allocations made to attain these targets and 
• the prevailing grassroots reality

This gap between vision and reality needs to be bridged. This needs national and international commitment to giving first priority to or "first charge on our exchequer" to "the disadvantaged" in any allocations, however constrained. In other words, correcting disparities must get priority over and above any and every other goal.

Poverty in India

Over the last five decades, systematic efforts have been made to alleviate poverty through increasing economic growth, direct attacks on poverty using targeted programmes, land and tenancy reforms, participatory and empowerment based approaches and provision of basic minimum services. As a result of these efforts, the incidence of poverty has declined from 54.9 per cent in 1973-74 to reportedly 26.1 per cent in 1999-2000. However, despite the many five year plans and major and minor changes in development policy and poverty alleviation strategies adopted by India since independence, unacceptably high levels of poverty and hunger persist, however measured and however defined.

The Tenth Five Year Plan (2002 - 2007) rightly draws attention to the fact that at the beginning of the new millennium, 260 million people in the country did not have incomes to access a consumption basket that defines the poverty line. Of these, 75 per cent were in the rural areas. India is home to 22 per cent of the world's poor. Reduction of poverty in India is, therefore, critical for the attainment of national and international goals.

Chronic Poverty: Key Issues from CPRC's Research in India

Several issues are emerging from CPRC's research in India. Some of these are highlighted below:

• We still have large numbers of people for whom poverty is intractable and who have remained marginalized. Further, not only are estimates of poverty high at any given point of time but a large number of those below the poverty line are chronically poor.
• Panel data studies for India show that more than half of the households who were poor at a given time remained in poverty over a decade later, thereby suffering long duration poverty. 52.61% of the households that were poor in 1970-71 remained in poverty over a decade later. A little less than half (47.39%) of households below the poverty line in 1970-71 escaped from poverty and became non-poor. Conversely one fourth of households who were non-poor in 1970-71 became poor a decade later.
  In the context of poverty related policy interventions it is important differentiate between factors and conditions driving poverty, persistence of poverty, escape from and entry into poverty.
• Factors that are related to the persistence of poverty are the scheduled tribe status, larger household size, increase in household size, larger number of dependent children and increase in number of dependent children. Since the scheduled tribes live in villages that are often far from good roads, lack electricity, clean drinking water, sanitation, schools and health care facilities, increased allocation of resources to enable human and infrastructure development in these areas should be a policy priority.
• Escape from poverty is enabled by increased income earning opportunities through growth in size of the village, or proximity to urban areas, improved infrastructure, initial literacy status of the household head, ownership of, or access to income from physical assets such as cropland, livestock, or a house, and increases in ownership of and therefore income from these assets. These findings would suggest that greater emphasis should be placed on literacy and infrastructure development and increased backward and forward linkages with urban areas than current policy orthodoxy displays.
• While caste and more particularly tribal status is an important determinant of poverty particularly severe poverty in the case of scheduled tribes, it is not an important determinant of exit from poverty which is dependent on acquisition of assets, literacy, better demographic profile of the household than its caste or tribal status.
• Perceived reasons for decline into poverty were high health care costs, high interest consumption debt from private money lenders, and social expenses on deaths and marriages. All of these can be addressed by policies and/or programmes.
• Chronic poverty seems to be disproportionately high among historically marginalised groups such as scheduled castes, scheduled tribes, the elderly, women and the disabled. The multiple deprivations suffered by these groups make it harder for them to escape poverty as disadvantages are mutually reinforcing.
• Casual agricultural labourers are the largest group and cultivators the second largest among the chronically poor. Most of the chronically poor are wage dependent.
• A significant proportion of people experiencing chronic poverty are severely poor, and those suffering extreme poverty have a high probability of experiencing chronic poverty.
• Hunger is the starkest indicator of severe poverty. Within the group of 204 million undernourished people in India, is a subset who are unable to access even two square meals a day. 4.2 per cent of rural and 1.1 per cent of urban households reported getting two square meals a day only during some months of the year. Those not getting two square meals a day even in some months of the year constituted 0.9 per cent of rural and 0.5 per cent of urban households.
• A large proportion of the poor in remote areas are both chronically and severely poor and the incidence of this is negatively associated with size of land holding and household population. Remote rural areas are likely to experience chronic poverty on the basis of agro-ecological and socio-economic factors. Unless efforts are made to develop the deprived areas, out migration from drought prone regions may only shift poverty from rural to urban or from dry land to agro-climatically better endowed regions.
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• Several states with high incidence of income poverty have the worst record on multidimensionality indicators. There are districts of India that reflect chronic and severe deprivation in multi-dimensional parameters. Strategic allocation of resources is needed to correct such imbalances.
• The urban poor who live in slums face situations of conflict and contested claims on spaces that provide opportunities for earning a livelihood and escaping from chronic poverty.
• There are increasing conflicts between the poverty affected social groups and others in the rural areas in recent decades. If there is deepening of disparities and destitution then there will be greater class-caste-tribe conflict.
• In the context of health related shocks it needs to be noted that poor quality of water can have serious health related ramifications. Water is precious and drinking water even more so. Public provisioning of safe and adequate drinking water to all citizens is the primary responsibility of the state. Failure in provision of drinking water occurs on many counts - lack of universal access, lack of achievement of minimum consumption norms, irregularity of supply, distance from source and quality. Many of the water borne diseases -gastroenteritis, and hepatitis originate from the pathogens present in drinking water. Health risks are also caused by excess flouride, arsenic, salinity, iron and chemical pollutants like pesticides and insecticides in water. It is estimated that in India 21 per cent of all communicable diseases (11.5 per cent of all diseases) are water related. Every year 1.5 million children under 5 years die in India of water related diseases and the country loses 1800 million person hours (over 200 million person days) each year due to water borne diseases. Those in chronic poverty such as casual labourers cannot afford to take time off from work in case of ill health. The food that they and their families eat, depends on the money earned from working that day. Since they cannot afford either the filtration devices devices or the medical costs of health related shocks and loss of work days from diseases caused by poor quality of water, providing safe drinking water for all in real terms is a key policy concern.
• Key issues in the context of hunger and severe poverty are identifying the extent of food and nutritional insecurity among the chronically poor; understanding the reasons for its occurrence and the associated reasons for state, societal and market failure to address this; and finding ways to ensure that the food grain stocks reach the hungry. The circumstances leading to hunger and starvation may be different for the chronically poor tribal in Orissa and the Andhra powerloom weaver who suddenly faces severe poverty, indebtedness and starvation due to an inability to compete with cheaper substitutes due to globalisation and policy change. However, the underlying cause of starvation in both situations is severe poverty - whether long duration or transitory.

Our future work will be concerned with strengthening the evidence base for pro-poor policy development at the national level as well as in the selected states of India. Our approach will be to use panel data and life history analysis through field work so as to to draw policy lessons that will reduce poverty and vulnerability for the persistently poor, and facilitate escape from and prevent entry into persistent poverty.