Poverty Line: Definition

The poverty line is an economic benchmark used to determine the minimum level of income required to maintain a basic standard of living. It helps identify individuals and families who are unable to meet their essential needs for food, shelter, and clothing.

Measurement of the Poverty Line

In India, the poverty line is determined based on various factors, including the cost of living and consumption patterns. It is assessed using two primary methods:

• Consumption Method: This method estimates the poverty line based on the consumption expenditure of households. It includes the average amount spent on food, clothing, education, and health.
• Income Method: This method calculates the poverty line based on the income of individuals or households. It assesses whether they earn enough to meet basic needs.

Poverty Line in India

The Planning Commission of India, now known as the NITI Aayog, sets the poverty line based on specific income thresholds. As of recent assessments, the poverty line is defined differently for rural and urban areas due to varying costs of living:

• Rural Poverty Line: This is set lower than the urban poverty line, reflecting the lower cost of living in rural areas.
• Urban Poverty Line: The urban poverty line is higher due to increased costs associated with living in cities.

Criticism of the Poverty Line

The concept of the poverty line has faced criticism for various reasons:

• Underestimation: Critics argue that the poverty line often underestimates the actual number of people living in poverty, as it focuses only on income and basic needs.
• Regional Disparities: The same poverty line may not reflect the variations in cost of living across different regions, leading to inaccurate assessments.
• Non-Monetary Factors: The poverty line fails to consider non-monetary aspects of poverty, such as lack of access to education, healthcare, and social services.

Government Initiatives

The Indian government has implemented various schemes to address poverty and improve the living standards of those below the poverty line. Some key initiatives include:

• National Rural Employment Guarantee Act (NREGA): This scheme provides a legal guarantee for at least 100 days of unskilled wage employment in a financial year to every rural household.
• Pradhan Mantri Awas Yojana (PMAY): This initiative aims to provide affordable housing to the urban poor, ensuring that every family has a roof over their heads.
• Mid-Day Meal Scheme: This program aims to improve the nutritional status of school children by providing free lunches in government schools.

Global Perspective

The concept of the poverty line is not limited to India. Many countries have their own criteria for determining poverty levels. Organizations like the World Bank use an international poverty line, which is set at $1.90 a day. This standard helps compare poverty levels across different nations and highlights global poverty issues.