16.4% Indians poor: Multidimensional Poverty Index 2023 Report

The Multidimensional Poverty Index (MPI) 2023 released this week by United Nations Development Programme (UNDP) presents detailed data on the state of poverty in the world. The report also highlights recent research on various poverty-related issues, including deprivation bundles, poverty reduction progress, the impact of COVID-19 on poverty, gendered and intra-household analyses of female schooling, and the relationship between the global MPI and Sustainable Development Goal indicators. The report provides MPI values for various countries and regions, including India, and provides data on various indicators of poverty.

Based on information from the National Family Health Survey for 2019–21, it is estimated that 16.4 per cent of Indians (or roughly 231 million) are “multidimensionally poor”—down from 55 per cent in 2005–2006. Rural poverty is prevalent throughout the world and accounts for over 84 per cent of the poor. In South Asia, where approximately 340 million (87.5 per cent) poor people reside in rural areas compared to 49 million (12.5 per cent) in urban areas, rural-urban inequities are evident. Even if urban poverty is a real issue, and household surveys could do a better job of capturing it, the majority of the poor reside in rural areas.

Previous global MPI reports have drawn attention to gender and ethnic disparities (UNDP and OPHI 2021) and inequalities across sub-national regions, age groups and rural-urban areas (UNDP and OPHI 2019), among other inequalities.

When comparing monetary and multidimensional poverty, it was found that in 42 out of 61 countries, more people live in multidimensional poverty based on the global Multidimensional Poverty Index (MPI) than in extreme monetary poverty based on the World Bank’s $2.15 a day measure. The report highlights that poverty has seen some changes over time. In 72 out of 81 countries, there has been a significant reduction in the MPI value during at least one period. However, it’s important to note that most of the data used in the report is from before the COVID-19 pandemic. It is also worth mentioning that 25 countries managed to halve their global MPI value within 15 years, showing that progress at scale is possible. However, there are still challenges to overcome. In 42 countries, children are being left behind, indicating a lack of progress in addressing child poverty. Furthermore, in 15 countries, the rate of poverty reduction was outpaced by population growth, resulting in an increase in the number of poor people despite declining poverty rates. The report highlights Cambodia as an example of progress, as it managed to halve its MPI in 7.5 years, including the years affected by the COVID-19 pandemic. This progress was achieved despite an increase in deprivations in school attendance. The text also emphasizes the importance of timely and disaggregated gathering of poverty data for effective policymaking and achieving the goals of the 2030 Agenda for Sustainable Development.

In India, a significant number of poor people experience various deprivations. Out of the 1.1 billion poor people in the country, 824-991 million lack adequate sanitation, housing or cooking fuel. Additionally, 600 million poor people live with someone in their household who is undernourished. The issue of gaps in education is also prevalent, as in all regions except Europe and Central Asia, around half of poor people do not have a household member who has completed six years of schooling. The global MPI, which measures acute multidimensional poverty, is constructed based on 43 survey questions, making it a relatively efficient data collection process. However, there is a need for increased investment in statistical sources to improve poverty statistics. Overall, the global MPI provides a comprehensive measure of poverty that goes beyond monetary indicators, taking into account various dimensions of deprivation. In India, as in many other countries, there is a need to address issues such as inadequate sanitation, housing, undernourishment, and gaps in education to effectively reduce poverty and improve the well-being of the population. The MPI is based on the Alkire-Foster method, which identifies people as multidimensionally poor if they are deprived in at least one-third of the weighted indicators. The report explains the process of selecting the indicators and dimensions used in the MPI, as well as the weighting system used to calculate the overall MPI value. The report also provides information on the data sources used to calculate the MPI, including household surveys and censuses. Finally, the report discusses the advantages and limitations of the MPI as a measure of poverty, including its ability to capture the multidimensional nature of poverty and its sensitivity to changes in poverty over time.