India's Poverty Numbers Estimation [UPSC Notes]

Recent changes (2023) in the National Sample Survey (NSS) consumption expenditure survey methodology make the survey incomparable with past rounds of surveys. In this article, you can read more about this topic, which is relevant for the IAS exam economy segment.

About Poverty Line Estimates

• A country’s economic progress can be measured by the rate of economic growth and the rate of poverty decline.
• While the rate of economic growth helps in estimating overall economic performance, the estimates of poverty decline help in analysing equity and equality in sharing of economic resources.
• One of the important official surveys in poverty estimates is the NSS consumer expenditure survey. The planning commission utilizes the quinquennial data from NSS to estimate the poverty level.
• The NSS consumption expenditure survey conducted last time showed a rapid decline in poverty level between 2004-05 and 2011-12. The data from the consumer expenditure survey conducted in 2017-18 was not released.
• NSS survey has evolved by adding new questionnaires to reflect changing consumption patterns. In order to improve the accuracy of the survey the methodology of the ongoing consumer expenditure survey (2022-23) is revamped.
• As per new changes, with the objective to keep interviews short, different parts of questionnaires were used in different visits. This change has made the survey incomparable with past rounds of surveys.

Measures Needed:

• Statistics and economics experts including Nobel laureates such as Angus Deaton, PC Mahalanobis and Moni Mukherjee recommended conducting consumer expenditure surveys on an annual basis.
• Regular conduct of the survey also ensures that each round of surveys can be compared and also allows experimentation. This will help avoid the trade-off between comparability and accuracy.
• Recommendations of the Adhikari panel can also be followed such as conducting large-scale pilot surveys using new questionnaires.
• Another recommendation can be to retain the sub-sample conducted using the past method to allow comparison with past rounds. This was initially recommended by the National Statistical Commission (NSC) but the decision was later reversed.

India’s Poverty Numbers Estimation:- Download PDF Here