India’s poverty rate dips to 21.8 pct-survey

INDIA: The number of poor people in India fell to 21.8 percent of its 1.1-billion population in the fiscal year ended March 2005, government data showed, thanks largely to strong growth in Asia’s fourth-largest economy.

A survey undertaken by the planning commission, a top policy setting body, on Wednesday showed that poverty as measured by the so-called mixed recall period method had declined to 21.8 from 26 percent in March 2000.

Under the method, consumer spending for five items such as clothing, footwear, durable goods, education and institutional medical expenses are collected from a 365-day period. According to government classification, the official poverty line for urban areas are people earning below 296 rupees ($6.78) per month and 276 rupees in rural areas.

This amount is enough to buy food equivalent to 2,200 calories per day, according to the government.

The Indian economy has grown at an average of more than 8 percent in the past four fiscal years and is poised for another year of nearly 9 percent growth in the fiscal year ending March 2008.

Strong economic growth has made millions of people in the cities richer, but it has bypassed the farming sector that supports more than 60 percent of India’s one billion-plus people.

In recent years, there has been a spate of suicides by poverty-stricken farmers unable to repay loans borrowed from village moneylenders at interest rates as high as 30-60 percent a month.

The ruling Communist-backed government, under strong criticism that many poor people are not benefiting from rapid economic growth, has promised to raise spending on health, education and sanitation.

Indian policymakers say sustained double-digit growth rates over the next 5-7 years would enable the country to wipe out mass poverty.

New Delhi, Thursday, Reuters