Poverty, unemployment, inflation and inclusive growth
Key facts
- 2005: The Mahatma Gandhi National Rural Employment Guarantee Act created a demand-driven legal guarantee of up to 100 days of unskilled manual wage em...
- 2009: The Tendulkar Committee report was accepted for official poverty estimation and shifted the poverty-line method towards a broader consumption ba...
- 2013: The National Food Security Act created statutory food-grain entitlements;
- 2014: The Rangarajan Committee proposed a higher poverty line than Tendulkar, but NITI Aayog records that the Tendulkar line remained the basis of the...
- 2015: The United Nations adopted the 2030 Agenda with 17 Sustainable Development Goals, linking poverty reduction, decent work, reduced inequality and...
Key Points at a Glance
- 1
2005: The Mahatma Gandhi National Rural Employment Guarantee Act created a demand-driven legal guarantee of up to 100 days of unskilled manual wage employment in a financial year for rural households whose adult members demand work.
- 2
2009: The Tendulkar Committee report was accepted for official poverty estimation and shifted the poverty-line method towards a broader consumption basket; the Planning Commission estimated India's 2011-12 poverty ratio at 21.9% on this method.
- 3
2013: The National Food Security Act created statutory food-grain entitlements; priority households receive 5 kg per person per month and Antyodaya households receive 35 kg per household per month.
- 4
2014: The Rangarajan Committee proposed a higher poverty line than Tendulkar, but NITI Aayog records that the Tendulkar line remained the basis of the official 1993-94, 2004-05 and 2011-12 poverty estimates.
- 5
2015: The United Nations adopted the 2030 Agenda with 17 Sustainable Development Goals, linking poverty reduction, decent work, reduced inequality and stronger institutions.
- 6
2016: The amended RBI Act gave statutory basis to India's flexible inflation-targeting framework; the CPI inflation target is 4% with a 2% to 6% tolerance band.
- 7
2024: NITI Aayog's discussion paper estimated that 24.82 crore people moved out of multidimensional poverty between 2013-14 and 2022-23, with the headcount ratio declining from 29.17% to 11.28%.
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Current NFSA delivery: Under PMGKAY, free food-grain distribution has an intended NFSA coverage of 81.35 crore persons, with about 80 crore persons receiving food grains free of cost in the latest official review, so food security remains a central anti-poverty stabiliser.
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Poverty: meaning and measurement
Poverty means inability to secure a minimum standard of living. In exam terms, it has two main forms. Absolute poverty uses a fixed minimum consumption or income threshold. Relative poverty compares a household's position with the general standard of society. India has historically used consumption-expenditure based poverty lines, because poor households often have irregular income but observable spending on food, fuel, clothing, rent, education and health. Causes include low and irregular income, landlessness, low productivity, ill health, weak schooling, social exclusion, regional backwardness and vulnerability to price or climate shocks.
The older calorie-norm approach focused on minimum food energy needs. The Lakdawala Committee kept state-specific poverty lines. The Tendulkar Committee submitted its report in December 2009; the Planning Commission accepted that methodology and estimated India's 2011-12 poverty ratio at 21.9%. The Rangarajan Committee, reporting in 2014, proposed a higher poverty line, but NITI Aayog later recorded that the Tendulkar line remained the basis of the official 1993-94, 2004-05 and 2011-12 poverty estimates. For CET, remember the sequence: calorie norm, Lakdawala, Tendulkar, Rangarajan, then renewed debate after newer household consumption surveys.
Core recall: poverty is not just low income; the measurement method decides who is counted and what policy follows. A good answer links poverty with employment, food security, education, health and productive assets, not only with cash income.
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