Though we'll have to wait a while for the final results to come in, the interim numbers are quite unequivocal. And exciting. Poverty level...
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Though we8217;ll have to wait a while for the final results to come in, the interim numbers are quite unequivocal. And exciting. Poverty levels across the country, say the part-results of the quinquennial NSS large sample survey, have fallen a dramatic 10 per cent in the last six years. While that still leaves India with the world8217;s largest concentration of poor 8212; 23 per cent in urban areas and 27 per cent in rural ones 8212; the NSS results vindicate the Manmohan-Chidambaram-Sinha theory that economic reforms alone will deliver India from poverty. More growth, and more economic reforms, will only intensify this fight against poverty.
At an intuitive level, this should be obvious 8212; after all, greater job creation is the only way to eradicate poverty. Except, the long-held view in India has been that economic growth in the reform years has been unequal, and may have accentuated poverty 8212; there are, of course, those who say that growth itself has fallen! Now the only way this could have happened is for growth to have been so concentrated in certain states, that the others suffered very badly. That, however, just didn8217;t happened. It is true that better-run states like Maharashtra and Gujarat saw seen a rise in economic growth in the reform years, and the badly-run ones like Bihar saw a massive decline Uttar Pradesh saw a small fall as well. But even Bihar did see a hike in per capita income, even though it was a mere one per cent or so, in the reform years. And other low-income states like Orissa saw their per capita incomes grow more than they did in the pre-reform years.
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The reason why the growth-is-bad theorists have had a field day so far, however, has something to do with official statistics as well. You see, the NSS also conducts a yearly thin8217; or small sample survey, and this has been showing an increase in poverty levels, from 38.03 per cent in rural areas in 1994-95 to 38.46 per cent in 1997. Several economists, however, have argued that the NSS8217; thin8217; sample results are faulty, and show totally wild fluctuations 8212; rural poverty figures, for instance, rose rapidly from 40.68 per cent in 1991 to 46.43 the next year and then fell just as dramatically to 38.03 per cent in 1994-95. It remains equally true that no two sets of even official figures in India seem to match 8212; two official estimates of the number of cattle in 1992, for instance, differed by as much as 32 per cent! Clearly much needs to be done to fix the quality of official statistics. But let8217;s not dismiss the latest poverty statistics as pure party propaganda. Purists can, and will, quibble overmethodology and a couple of percentage points here or there. But let8217;s not ignore the other evidence, this time from private firms, that points us in the same direction. Year after year, the NCAER8217;s annual household surveys, as well as the rosy balance sheets of consumer goods firms, show a sharp surge in the purchases of consumer durables like washing machines, refrigerators, colour televisions, you name it. None of this is compatible with anything but poverty levels declining significantly. It8217;s good to be sceptical, but let8217;s not overdo it.
