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Poverty Debate in India:

Poverty of imagination

A poverty of imagination must be overcome that frames and informs social welfare policies. The problem of poverty creation does not appear on policymakers’ radar screens, because official statistics do not shed light upon the magnitude of this problem. Officials are concerned with reducing the stock of poverty, and that is all they measure: stocks – but not flows.

Measuring only stocks is hardly sufficient, however, for designing the policies that are required. Ascertaining the separate rates of escape and descent is indispensable because different types of policies are needed to address each of these trends.

Consider a hypothetical example in which the national stock of poverty, 32%in 2000, fell to 24%by 2010. How did this 8% reduction actually come about? Should we be gladdened or disheartened by this occurrence? The answer depends upon the underlying flows: Did (A) 8% of the population escape poverty, and no one fell into poverty (which is terrific); or (B) did 16%escape poverty, while 8% concurrently became poor; or (C) causing most despair, did 24% escape poverty and 16%fall into poverty.

Official data do not help distinguish between these (and innumerable other) possibilities, all of which can underlie the observed 8% net reduction. And so the problem remains.

Preventing poverty creation is both necessary and possible. Similarly, the paucity of opportunities available to poorer people has to be remedied. Helping more people rise above the poverty line is, no doubt, essential. But young people, like Chandru and Vasundhara and Bhoora, whom we will meet in a later posting, are capable of rising much further.