A record 13.5 crore people moved out of multidimensional poverty between 2015-16 and 2019-21 as per NITI Aayog’s Report ‘National Multidimensional Poverty Index: A Progress Review 2023’. The Report was released on July 17, 2023.
Second Edition Of National Multidimensional Poverty Index (MPI)
Based on the latest National Family Health Survey [NFHS-5 (2019-21)], the second edition of the National Multidimensional Poverty Index (MPI) represents India’s progress in reducing multidimensional poverty between the two surveys, NFHS-4 (2015-16) and NFHS-5 (2019-21).
It builds on the Baseline Report of India’s National MPI launched in November 2021.
The methodology used is consistent with the global methodology.
Global Multidimensional Poverty Index (MPI)
Historically, poverty was calculated by looking only at income. Now, there is a better way called the Global Multidimensional Poverty Index (MPI), which uses the Alkire-Foster (AF) method to consider not just income, but also lack of access to healthcare, education, and basic living standards.
It directly compares and takes into account deprivations, which makes it a valuable addition to income poverty measurements.
Oxford Poverty and Human Development Initiative (OPHI) and the United Nations Development Programme (UNDP) work together to publish the global MPI Report.
Indian Government has recognized the importance of the global MPI as part of the Global Indices for Reform and Action (GIRG) initiative for reform and action.
The goal of the GIRG initiative is to use global indices as tools for both improving the country’s performance and ranking, as well as driving systemic reforms and growth.
NITI Aayog is responsible for developing an index to monitor how well States and Union Territories are addressing poverty that considers multiple factors. This is part of their role as the coordinating agency for the MPI.
NITI Aayog’s Report On Multidimensional Poverty: 12 Indicators
India’s national MPI consists of three dimensions – Health, Education, and Standard of Living. Like the global MPI, all three dimensions have equal weightage. They are measured by 12 indicators, similar to the global MPI. The graphic below shows these indicators:
These dimensions are represented by 12 SDG-aligned indicators.
These include nutrition, child and adolescent mortality, maternal health, years of schooling, school attendance, cooking fuel, sanitation, drinking water, electricity, housing, assets, and bank accounts. Marked improvement is witnessed across all the 12 indicators.
Sub-indices of the National MP
The indices of the national MPI comprise:
i) Headcount ratio (H): What is the proportion of multidimensionally poor people in the population? This is calculated by dividing the number of multidimensionally poor individuals by the total population.
ii) Intensity of poverty (A): What is the level of deprivation experienced by individuals who are considered multidimensionally poor on average?
To compute intensity, the weighted deprivation scores of all poor people are summed and then divided by the total number of poor people.
MPI value is calculated by multiplying two factors: The headcount ratio (H) and the intensity of poverty (A). This measurement reflects the percentage of people who are living in poverty and the severity of their deprivation.
When An Individual Is Considered MPI Poor
As per the AF methodology, if an individual’s deprivation score is 33.33% or more, they are classified as MPI poor.
The Multidimensional Poverty Index is crucial in evaluating progress towards reducing all forms of poverty, as targeted under Goal 1.2 of the Sustainable Development Goals.
In November 2021, NITI Aayog released the national MPI Baseline Report which used data from the National Family Health Survey (NFHS-4) conducted in 2015-16 to make estimates.
National Multidimensional Poverty Index 2023: Key Findings
- Report states that India’s number of multidimensionally poor has decreased by 9.89 percentage points, going from 24.85% in 2015-16 to 14.96% in 2019-2021.
- Poverty in rural areas decreased from 32.59% to 19.28%, which was a faster decline compared to urban areas where poverty decreased from 8.65% to 5.27% during the same time period.
- 3.43 crore individuals in Uttar Pradesh were able to escape multidimensional poverty, indicating the fastest decline in poverty levels within the state.
- According to the Report, the States of Uttar Pradesh, Bihar, Madhya Pradesh, Odisha, and Rajasthan showed the quickest decrease in the percentage of people who were multidimensionally poor.
- India’s progress towards achieving the SDG Target 1.2 of reducing multidimensional poverty by at least half by 2030 is faster than expected. Between 2015-16 and 2019-21, the MPI value has decreased by almost half, from 0.117 to 0.066, and the intensity of poverty has decreased from 47% to 44%.
- The report shows that the Government is committed to achieving sustainable and fair development, and ending poverty by 2030, in line with its pledge to the SDGs.
- Government’s efforts to enhance access to sanitation, nutrition, cooking fuel, financial inclusion, drinking water, and electricity have resulted in notable progress in these sectors.
- The 12 parameters of MPI have significantly improved, and flagship programs such as Poshan Abhiyan and Anaemia Mukt Bharat have helped reduce health deprivations.
- Sanitation in the country has been improved by initiatives like Swachh Bharat Mission (SBM) and Jal Jeevan Mission (JJM), leading to a noticeable 21.8 percentage point improvement in sanitation deprivations.
- Pradhan Mantri Ujjwala Yojana (PMUY) has provided subsidized cooking fuel, resulting in a 14.6% improvement in cooking fuel access and positively transforming lives.
- Schemes like Saubhagya, Pradhan Mantri Awas Yojana (PMAY), Pradhan Mantri Jan Dhan Yojana (PMJDY), and Samagra Shiksha have had a significant impact on reducing multidimensional poverty in the country.
- Government’s dedication to enhancing citizens’ lives and building a better future for all is demonstrated by the significant improvement in access to basic necessities like electricity, bank accounts, and drinking water, which has resulted in extremely low deprivation rates.
- Ensuring that various programs and initiatives are implemented consistently and in coordination with each other, India has successfully reduced deprivations across multiple indicators.
Read Full Report Here