With the results of the first round of the Household Consumer Expenditure Survey (HCES) 2022-23 now available, Bibek Debroy, Chairman of the Economic Advisory Council to the Prime Minister, has called for a new estimate for the poverty line in India.
“We still do not have an official poverty line after the Tendulkar [Committee] and the multidimensional poverty index is not quite a poverty line. Should we now have a new poverty line in which this data can be used,” Debroy noted at a Data Users Conference on the household consumer expenditure survey on Wednesday.
Historically, the Planning Commission periodically estimated poverty lines and poverty ratios for each year the HCES was conducted. The last HCES with available results pertains to 2011-12. In December 2005, the Planning Commission constituted an Expert Group under the chairmanship of Suresh Tendulkar to review the methodology for estimating poverty.
The Tendulkar Committee submitted its report in December 2009, computing poverty lines and poverty ratios for 2004-05.
Subsequently, a committee led by C. Rangarajan was established to review the poverty line methodology amid concerns that the Tendulkar poverty line was too low. However, the Planning Commission updated the poverty estimates for 2011-12 using the Tendulkar Committee's methodology.
In recent developments, the NITI Aayog released a multidimensional poverty index, revealing that 250 million people moved out of poverty between 2015 and 2024.
Addressing the conference, Debroy emphasized that while improvements in the HCES 2022-23 methodology are desirable, they may render comparisons with previous surveys non-viable. He also questioned whether the decline in the Gini coefficient, a measure of inequality, is beneficial.
“As the economy grows and prospers, inequality tends to widen a little bit,” he said.
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