Accurate poverty measurement is foundational to targeting welfare expenditure. India's successive expert committees have refined poverty lines, yet methodological divergences continue to shape both the scale of deprivation acknowledged and the policy responses designed.
The Rangarajan Committee (2014) recommended separate Monthly Per Capita Expenditure (MPCE) thresholds for rural and urban areas, recognising structural differences in consumption baskets and cost of living. The rural poverty line was set at ₹972 and the urban line at ₹1,407 per person per month at 2011-12 prices. This spatial differentiation improved targeting precision compared to earlier uniform approaches.
Unlike earlier committees that anchored poverty lines primarily to calorie intake norms, the Rangarajan Committee incorporated a broader normative basket covering food, clothing, education, health, and transport. It did not entirely reject nutritional considerations but moved beyond a single calorie threshold, embedding a more multidimensional consumption standard into the estimation framework.
A significant policy implication of the Rangarajan methodology was that it yielded a higher poverty ratio for 2011-12 — approximately 29.5 percent — compared to the Tendulkar Committee's estimate of around 21.9 percent for the same year. This upward revision enlarged the eligible population for welfare programmes, directly affecting resource allocation decisions.
Frequent revisions in poverty lines create administrative uncertainty in scheme eligibility, beneficiary identification under programmes like the National Food Security Act, and inter-state resource transfers. A stable, legislatively anchored methodology remains absent, leaving poverty estimation vulnerable to political contestation and periodic methodological disruption.
Poverty estimation is not merely a statistical exercise; it determines the architecture of social protection. Institutionalising a transparent, periodically updated, and multidimensional methodology — insulated from short-term political pressures — remains an unfinished governance imperative.
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