National Multidimensional Poverty Index

National Multidimensional Poverty Index

News: Recently, The NITI Aayog released the ‘National Multidimensional Poverty Index: A Progress Review 2023’.

Key Findings:
• India has seen a 9.89% decrease in multidimensionally poor people from 2015-16 to 2019-2021, with 13.5 crore people escaping poverty.
• The national MPI value has reduced from 0.123 in 2015-16 to 0.071 in 2019-21, indicating an improvement in the overall well-being of the population
• The rural areas witnessed the fastest decline in poverty from 32.59% to 19.28%, while the urban areas saw a reduction in poverty from 8.65% to 5.27%
• However, one in seven Indians is multidimensionally poor.

What is National MPI?
• The project is aimed at deconstructing the Global MPI and creating a globally aligned and yet customised India MPI.
• It seeks to draw up comprehensive Reform Action Plans with the larger goal of improving India’s position in the Global MPI rankings.
• NITI Aayog is the nodal agency for the National MPI, ranking States and UTs based on their performance.

What methodology does it follow?
• It captures overlapping deprivations in health, education and living standards to ascertain multidimensional poverty.
• Each of the specific parameters (under 3 broad categories) is assigned a value to calculate what is called a ‘deprivation score’.
• The deprivation score is the sum of the weighted status of all the indicators for an individual – if it is more than 0.33, only then an individual is considered multidimensionally poor.
• The primary data source to arrive at these figures was National Family Health Survey-5 (NFHS-5).

How have different states fared?
• BIMARU states - The number of people in poverty in rural areas witnessed the fastest decline (from 32.59 to 19.28%), owing to improvements in states like Bihar, UP, MP, Odisha, and Rajasthan.
• The number of states with less than 10% people living in multidimensional poverty doubled in the five years between 2016 and 2021.
• Except for Bihar, no other state in India has more than one-third of its population living in multidimensional poverty.

What initiatives have helped in reducing India’s multidimensional poverty?
• Improvements in indicators pertaining to access to clean cooking fuel, bank accounts, access to drinking water and sanitation have helped.
• Flagship initiatives such as PM Jan Dhan Yojana, Swachh Bharat Mission, Jal Jeevan Mission, PM Ujjawala Yojana have been helpful.
• Better nutrition and healthcare through PM Poshan Abhiyan, Ayushman Bharat, Anaemia Mukt Bharat, Fortification of Rice etc have also helped.

What factors are keeping Indians multidimensionally poor?
• Within the health category, 3 sub-indicators – nutrition, child and adolescent mortality, and maternal health – showed only moderate improvement.
• Lack of proper nutrition contributed close to 30% – the highest – in the overall calculation of India’s MPI.
• Other indicators that did not record a significant decline include lack of years of schooling, inadequate access to maternal health services and less-than-desired school attendance.