India's Poverty To Reduce By 75 Percent: The World Bank


BANGALORE: India’s huge population has always been a problem, which in turn has lead to the rise in the number of poor in the country. According to recent reports and findings of the World Bank that revised the Purchasing power parity index, they have said that the poor in India will change drastically. They are also planning to revise the global poverty line.

The World Bank has revised the global poverty line at $1.25 from now. India had 400 million poor people in 2010 but the revision of the PPP index showed that the Indian economy is much bigger and the purchasing power is much higher than estimated earlier. This means that the number of poor people is lower than before. As per calculations and suggestions by experts, the number of poor people in India is set to reduce. 

PPP index is given by the World Bank under its International Comparison Programme. This is a huge task as it involves the effort collate and compare prices of hundreds of commodities and services from around the globe. Kaushik Basu, now chief economist of the World Bank, puts it, "In case a dollar in Ghana can buy three times what it can buy in the United States, then a person who earns 1,000 dollars each month in Ghana is said to earn 3,000 in terms of 'PPP-adjusted dollars'."

Unlike the number of poor people back in 2010 with over 400 million in India, the revised PPP number will see a decline of the Indian Poor to 102.3 million and according to calculations by Brookings institution it suggests that it should fall down as low as 98.9 million. Global poverty is on a decline as well which will see the number reduced to 571.3 million overnight. This means that the Millennium Development Goals target for 2015 has been met. This statistical decline is done by calculating the PPP index and the global poverty line.  

N C Saxena, who has worked on identifying the poor in India, notes, "The value of the dollar renders the PPP price index an unfair representative of the purchasing power of people in developing countries, especially of the poor."

“To end extreme poverty, the vast numbers of the poorest – those earning less than $1.25 a day – will have to decrease by 50 million people each year until 2030. This means that 1 million people each week will have to lift themselves out of poverty for the next 16 years. This will be extraordinarily difficult, but I believe we can do it. This can be the generation that ends extreme poverty,” said Kim, the President of WBG.

For India to reach this level of decrease it must start focusing on integrating development with extreme poor so that they are bound in the process of growth whereby they are directly influenced and hence get a chance to benefit from the development of the nation.

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