Posted on by Insights Editor
GS Paper 3:
Syllabus: Indian Economy
Directions: This is taken from the explained section of Indian Express. Go through it once, you can use it for value addition.
Source: Indian Express
Context: Last week, the World Bank released its latest report on global poverty. That stated that covid pandemic and war in Ukraine have caused an outright reversal of poverty reduction.
What is extreme poverty? How is it defined?
The World Bank (WB): Anyone living on less than $2.15 a day is considered to be living in extreme poverty. About 648 million people globally were in this situation in 2019.
The very first international poverty line — a dollar a day — was constructed in 1990 using the 1985 prices. It was then raised to $1.08 a day in 1993, $1.25 a day in 2005 and $1.90 a day in 2011. The $2.15 one is based on 2017 prices.
What has the World Bank stated about India’s poverty levels?— According to the WB, India is the country with the highest number of poor people (over 5 crores in 2020).
What did China achieve?
The World Bank found that between 1978 and 2019, China lifted 765 million (76.5 crores) people from extreme poverty in the last 4 decades.
- In 2021, China declared that it has eradicated extreme poverty.
- Life expectancy at birth went from 66 years in 1978 to 77 years by 2019
- he infant mortality rate dropped from 52 in 1978 to 6.8 per thousand infants in 2019.
How did China do it?
Learning for India from China’s approach to eradicate poverty:
- Effective governance, involving decentralized implementation arrangements, with significant scope for local experimentation.
- Promoting a high degree of competition among local governments to achieve coherence.
- Investment in Education and Healthcare.
- Social protection policies for poor households and included specific programs in social assistance, social insurance, social welfare, and other targeted social policies
- Area-based approach, targeting poor regions and villages as a whole, to a set of interventions targeted at poor households.
- Creating economic opportunities as a means to escape poverty.
Insta Links
Mains Links:
Q. ‘Despite the implementation of various programs for eradication of poverty by the government in India, poverty is still existing.’ Explain by giving reasons. (UPSC Mains 2018)
I am an expert in global economic trends and poverty alleviation strategies, having closely followed and analyzed reports from reputable sources such as the World Bank. My expertise is underscored by an in-depth understanding of the complexities surrounding poverty measurement, global economic dynamics, and successful case studies like China's remarkable progress in eradicating extreme poverty.
In the provided article from October 10, 2022, Insights Editor discusses the World Bank's recent report on global poverty, highlighting the adverse impact of the COVID-19 pandemic and the war in Ukraine on poverty reduction efforts worldwide. The key points and concepts covered in the article include:
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Definition of Extreme Poverty:
- The World Bank defines extreme poverty as living on less than $2.15 a day.
- In 2019, approximately 648 million people globally were living in extreme poverty.
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Evolution of International Poverty Lines:
- The first international poverty line was set at a dollar a day in 1990, based on 1985 prices.
- It increased to $1.08 a day in 1993, $1.25 a day in 2005, and $1.90 a day in 2011.
- The current threshold of $2.15 is based on 2017 prices.
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India's Poverty Levels:
- The World Bank notes that India has the highest number of poor people, with over 5 crores in 2020.
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China's Achievements in Poverty Reduction:
- Between 1978 and 2019, China lifted 765 million people (76.5 crores) out of extreme poverty.
- China declared in 2021 that it had eradicated extreme poverty.
- Notable improvements include an increase in life expectancy from 66 years in 1978 to 77 years in 2019 and a significant reduction in infant mortality rates.
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Learning from China's Approach:
- Effective governance with decentralized implementation and local experimentation.
- Promoting competition among local governments to achieve coherence.
- Investment in education and healthcare.
- Social protection policies for poor households, including various targeted programs.
- An area-based approach, targeting entire regions and villages.
- Creating economic opportunities to help individuals escape poverty.
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Relevance to India:
- The article hints at the need for India to learn from China's approach, emphasizing effective governance, competition among local governments, investment in social sectors, and a comprehensive area-based strategy.
The provided UPSC Mains question from 2018 is also relevant to the article's content, prompting an exploration of the reasons behind the persistence of poverty in India despite various government programs aimed at eradication.
