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National Multidimensional Poverty Index

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July 21, 2023

Why in news?

Recently, Niti Aayog has released a report titled “National Multidimensional Poverty Index: A Progress Review 2023”.

What is Multidimensional Poverty?

  • Poverty According to the World Bank, those who are unable to earn 2.15 dollar per day are living in extreme poverty.
  • As per UNDP, it is the measure of poverty that considers various deprivations experienced by people in their daily lives including poor health, insufficient education and low standard of living.
  • It is a means to capture the complexity of poverty that considers dimensions of well-being beyond just monetary poverty.
  • Global MPI Report – It is jointly published by the Oxford Poverty and Human Development Initiative (OPHI) and the United Nations Development Programme (UNDP).
  • It is based on the Alkire-Foster (AF) methodology that captures overlapping deprivations in health, education, and living standards.

What is the Niti Aayog’s MPI report about?

  • National Multidimensional Poverty Index: A Progress Review 2023 - In national level, Niti Aayog is the nodal agency to release MDP report for states and Union Territories.
  • It plays a pivotal role in assessing advancements towards Sustainable Development Goals (SDGs) 1.2 - Reduce at least by half the proportion of men, women and children of all ages living in poverty in all its dimensions.
  • It presents the changes in multidimensional poverty between the survey periods of NFHS-4 (2015-16) and NFHS-5 (2019-21).
  • Source data - Data inputs are taken from National Family Health Survey (NFHS-5).
  • Indicators - India’s national MPI has 3 equally weighted dimensions - Health, Education, and Standard of living – which are represented by 12 indicators.
  • Sub-indices of National MPI
  • Headcount ratio (H): How many are poor?
  • Intensity of poor (I): How poor are the poor?
  • MPI= H*I
  • If the deprivation score (sum of the weighted status of all the indicators) for an individual is more than 0.33, then an individual is considered multidimensionally poor.

Niti Aayog 1 2023

What are the key findings?

  • Poverty in India - There has been steep decline in the poverty, India has achieved a remarkable reduction in its MPI value and headcount ratio between 2015-16 and 2019-21.
  • It registered a decline in the number of “multidimensionally poor” individuals, from 24.85 % in 2015-16 to 14.96 % in 2019-2021.
  • Around 13.5 crore Indians escaped poverty between the 5 year time period due to improvements in indicators like access to cooking fuel, sanitation, drinking water etc.,
  • 1 in 7 Indians multidimensionally poor due to marginal improvement in indicators like nutrition and access to education.
  • Regional disparity- Rural areas witnessed faster decline in poverty from 32.59% to 19.28% than urban area,
  • Poverty in States - The number of states with less than 10% people living in multidimensional poverty doubled in the five years between 2016 and 2021.
  • The poverty struck states are Mizoram, Himachal Pradesh, Punjab, Sikkim, Tamil Nadu, Goa, and Kerala, Telangana, Andhra Pradesh, Haryana, Karnataka, Maharashtra, Manipur, and Uttarakhand.
  • No other state in India has more than one-third of its population living in multidimensional poverty other than Bihar.

Niti Aayog 2 2023

What is keeping Indians multidimensionally poor?

  • Lack of uniformity- Poverty reduction is not equally represented in the three main indicators of standard of living, health, and education.
  • Marginal health performance- Three sub-indicators of health which are nutrition, child and adolescent mortality, and maternal health showed only moderate improvement.
  • Nutrition deprivation- It contributes close to 30% the highest in calculation of MPI which results in nearly 1/3rd of multidimensional poverty in India.
  • Lack of education-It is due to lack of years of schooling (16.65%), and less-than-desired school attendance (9.10%).
  • Cooking fuel- Though it marked a significant improvement, around 44% of Indian population is still deprived of it.
  • Sanitation- Despite its improvement, sanitation services are still deprived to around 30% of the population.
  • Access to housing- In India, 41% of the population is still deprived of housing.

References

  1. Indian Express| Explained MDP report
  2. Niti Aayog| MDP report
  3. The Hindu| Decline in Multidimensional poor
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