In the ongoing pursuit of socioeconomic progress, nations around the world continually grapple with the challenge of poverty alleviation. Within this context, the Head Count Ratio (HCR) serves as a critical metric, offering insight into the proportion of a population living below the Poverty Line. Recently, India achieved a significant milestone on its developmental journey, as research conducted by the American think tank Brookings indicates the official eradication of "extreme poverty" within its borders. This remarkable feat is not only marked by a substantial decline in the headcount poverty ratio but also by a noteworthy surge in household expenditures. At the heart of this achievement lies the government's proactive redistribution policies, which have played a pivotal role in fostering a decade of robust and inclusive development for the nation.

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What Helped In Eliminating Poverty:

According to Brookings, high growth and a large decline in inequality have combined to eliminate poverty in India for the Purchasing Power Parity USD 1.9 poverty line. The Headcount Poverty Ratio (HCR) for the 2011 PPP USD 1.9 poverty line has declined from 12.2 percent in 2011-12 to 2 percent in 2022-23, equivalent to 0.93 percentage points (ppt) per year. Rural poverty stood at 2.5 percent while urban poverty was down to 1 percent. For the PPP USD 3.2 line, HCR declined from 53.6 percent to 20.8 percent. Notably, these estimates do not take into account the free food (wheat and rice) supplied by the government to approximately two-thirds of the population, nor utilization of public health and education, the think tank stated. The data show a strikingly lower number of poor people in India, at both thresholds than those estimated by the World Bank.


India’s Headcount Poverty Ratio:

The Brookings Report presented a chart showing India’s Headcount Poverty Ratio for both the 1.9 USD PPP ( Purchasing power parities (PPPs) are the rates of currency conversion that try to equalize the purchasing power of different currencies, by eliminating the differences in price levels of between countries) and the 3.2 USD PPP from 1977-78. It stated that the change in slope of the HCR for the higher 3.2 USD poverty line “reveals the extent of inclusive growth experienced in India over the last decade.” The decline in HCR at the higher poverty line is remarkable given that in the past it took 30 years for India to witness a similar decline in poverty levels as now witnessed over 11 years, it added. The authors think that the relatively higher consumption growth in rural areas should not come as a surprise given the “strong policy thrust on redistribution through a wide variety of publicly funded programs.” Brookings lauded the national mission for the construction of toilets and attempts to ensure universal access to electricity, modern cooking fuel, and, more recently, piped water, among the policies that thrived consumption. The rural access to piped water in India as of August 15, 2019, was 16.8 percent and at present it is 74.7 percent, the report cited. The reduced sickness from accessing safe water may have helped families save more income.


District Program with Aspirations:

Similarly, 112 districts nationwide were designated as having the lowest development indicators under the Aspirational District Programme. Government measures specifically targeted these districts to enhance their development performance. According to official data, India has successfully eradicated severe poverty, as it is generally referred to in international comparisons. According to the Brookings paper, "This is an encouraging development with positive implications for global poverty headcount rates."This implies that India must now advance to a higher poverty level in line with other nations. Redefining current social security programs is made possible by the move to a higher poverty level, especially with the aim of better identifying intended beneficiaries and offering more assistance to the truly impoverished.