1. Poverty Measurement in India: Revisiting the Rangarajan Line & Shift to Multidimensional Poverty – Economy
Why in News?
A recent study by economists from the RBI’s Department of Economic and Policy Research (DEPR) has updated India’s state-wise poverty estimates using data from the 2022–23 Household Consumption Expenditure Survey (HCES). This comes 15 years after the C. Rangarajan Committee redefined India’s poverty line.
Background: Measuring Poverty in India
Poverty Line: A benchmark used to identify the minimum income level required to meet basic needs.
India has historically used monetary poverty measures based on monthly per capita expenditure.
Committees formed over the years to redefine poverty:
Lakdawala Committee (1993)
Tendulkar Committee (2009)
Rangarajan Committee (2014)
Rangarajan Committee (2014) – Key Highlights
Monthly poverty line (2011–12 prices):
Rural: ₹972/month
Urban: ₹1,407/month
Estimated 29.5% of India’s population below the poverty line (2011–12).
Criticized for setting poverty lines too low, yet provided a broader consumption basket than the Tendulkar method.
Recent RBI Study: Poverty Estimates (2022–23)
Key Findings:
Odisha: Rural poverty fell from 47.8% to 8.6%
Bihar: Urban poverty dropped from 50.8% to 9.1%
Himachal Pradesh: Lowest rural poverty at 0.4%
Tamil Nadu: Lowest urban poverty at 1.9%
Chhattisgarh: Highest rural (25.1%) and urban (13.3%) poverty rates
Methodological Update:
Developed a new price index to reflect changes in the consumption basket, instead of merely adjusting for inflation using the Consumer Price Index (CPI).
Allowed state-specific poverty lines, accounting for regional variations in cost of living.
Shift to Multidimensional Poverty Index (MPI)
What is MPI?
Introduced by UNDP and Oxford Poverty and Human Development Initiative (OPHI).
Measures poverty beyond income: based on three dimensions:
Health (nutrition, child mortality)
Education (years of schooling, school attendance)
Standard of Living (access to electricity, sanitation, housing, etc.)
Significance:
Reflects deprivations in capabilities and access to basic services.
More aligned with SDG Goal 1: End poverty in all its forms.
Implications & Way Forward
Positive Trends: Marked reduction in poverty in previously underdeveloped states.
Policy Implications:
Need for targeted interventions in lagging regions like Chhattisgarh.
Shift to multidimensional policies focusing on health, education, and living standards.
Importance of region-specific poverty measurement for tailored policymaking.
Monitoring Tools: Periodic consumption surveys & MPI tracking essential for data-driven governance.
Exam Connect – Possible Questions
Prelims
1. Which of the following committees is associated with redefining the poverty line in India in 2014?
A. Tendulkar Committee
B. Lakdawala Committee
C. Rangarajan Committee
D. Dandekar Committee
Answer: C. Rangarajan Committee
2. As per the RBI’s updated poverty estimates (2022–23), which Indian state recorded the lowest rural poverty rate?
A. Bihar
B. Tamil Nadu
C. Himachal Pradesh
D. Kerala
Answer: C. Himachal Pradesh
Mains
1. Poverty in India is no longer just a question of income deprivation but also of access to basic services. Critically examine this statement in the context of the shift to the Multidimensional Poverty Index (MPI).
2. Evaluate the effectiveness of state-specific policy interventions in reducing poverty with reference to recent data from Odisha, Bihar, and Himachal Pradesh. What lessons can be drawn for inclusive development?
2. India’s Elephants and Their Growing Survival Challenge – Environment
Why in News?
The Wildlife Institute of India (WII) has released its report titled “Status of Elephants in India”, estimating the elephant population at 22,446 across four major landscapes. This marks a decline from the 2017 estimate (29,964), but the drop is attributed to a new DNA-based estimation method, not necessarily a real population decline.
Key Highlights from the Report
New DNA-Based Estimation Method:
Part of the Synchronous All-India Elephant Estimation (SAIEE) 2021–25.
Uses genetic sampling (DNA from dung samples) for more accurate, non-duplicated counts.
Aims to establish a scientific baseline for future monitoring — not a direct comparison with previous visual counts.
Major Elephant Habitats in India:
Western Ghats: Primary stronghold of elephants — over 50% of India’s population.
Key states: Karnataka, Kerala, Tamil Nadu
Other elephant landscapes:
North East India
Central India
Northern West Bengal and the Brahmaputra floodplains
Major Concerns Identified
1. Habitat Fragmentation:
Caused by: Highways, rail lines, dams, urban expansion, mining.
Leads to disruption of elephant corridors — the natural movement paths elephants follow.
Increases genetic isolation and stress, impacting reproduction and health.
2. Human-Elephant Conflicts (HEC):
Elephants raid crops or enter human settlements when habitats are disturbed.
Leads to:
Human fatalities and injuries
Retaliatory killings of elephants
Damage to property and crops
Rising incidents especially in states like Assam, Odisha, West Bengal, and Jharkhand.
3. Inadequate Community Involvement:
Conservation efforts often lack local participation, leading to mistrust or non-cooperation.
Absence of compensation mechanisms also heightens tensions.
Way Forward and Conservation Measures
Community-Based Solutions:
Awareness campaigns, early warning systems, and compensation schemes.
Involving local communities in habitat protection and conflict resolution.
Habitat Restoration:
Reconnecting elephant corridors and reducing fragmentation through eco-sensitive planning.
Promoting wildlife-friendly infrastructure, such as underpasses and overpasses.
Scientific Monitoring:
Continued use of DNA-based tracking for reliable data and long-term conservation planning.
Periodic assessments to guide policy adjustments.
Exam Connect – Possible Questions
Prelims
1. Which region of India hosts over half of the country’s wild elephant population, according to the Wildlife Institute of India?
A. North East
B. Central India
C. Western Ghats
D. Terai Arc
Answer: C. Western Ghats
2. The recent elephant population survey in India used which of the following techniques for estimation?
A. Camera trapping
B. Radio telemetry
C. DNA-based sampling
D. Satellite collaring
Answer: C. DNA-based sampling
Mains
1. “Habitat fragmentation and increasing human-wildlife conflict are the two major challenges to elephant conservation in India.” Examine the causes and suggest measures to address these challenges with suitable examples.
2. Discuss the significance of adopting DNA-based estimation techniques in wildlife conservation. How can this approach transform future biodiversity assessments in India?
3. Delay in Carbon-Free Shipping Plan Due to Global Divide – Environment
Why in News?
The International Maritime Organisation (IMO) has delayed its global carbon-free shipping plan by one year, pushing the implementation from 2027 to 2028. The delay follows opposition from countries like the United States, citing economic concerns.
Background: Shipping and Global Emissions
Shipping = 2–3% of global CO₂ emissions.
Most ships burn heavy fuel oil, a highly polluting fossil fuel.
International shipping is difficult to regulate as it falls outside the emissions inventories of individual countries.
With rising global trade, emissions from the shipping sector are expected to grow significantly unless strict regulations are adopted.
About the IMO and Its Climate Strategy
International Maritime Organisation (IMO):
A UN specialized agency, headquartered in London.
Mandated to ensure safe, secure, and environmentally sound shipping.
All regulations passed by the IMO are binding on member states.
IMO’s Revised Greenhouse Gas (GHG) Strategy (2023):
Net-zero emissions target by 2050.
Interim targets for 2030 and 2040, including:
Carbon intensity reductions,
Transition to low- and zero-carbon fuels,
Introduction of global carbon pricing and fuel standards.
Reasons for Delay: Global Divide
Supporters (63 countries) proposed:
A carbon pricing mechanism (similar to a carbon tax or trading),
New fuel standards to force adoption of clean technologies,
Revenue redistribution to support developing countries.
Opposition from the U.S. and a few others:
Cited concerns over:
Rising costs of goods for domestic consumers,
Lack of readiness for rapid technology transition,
Impact on competitiveness of national shipping fleets.
Impacts of the Delay:
Climate-vulnerable nations (e.g., small island states) criticized the decision, warning of lost momentum in climate action.
Could undermine investor confidence in green shipping tech (e.g., hydrogen fuel, ammonia engines).
May allow time for a more equitable framework, considering common but differentiated responsibilities (CBDR).
Implications for India and the Global South
India supports climate action but emphasizes the need for fairness and technology transfer.
Developing countries argue that developed nations must bear the brunt of costs, given their historical emissions.
Shipping costs directly affect India’s exports/imports, especially in agriculture, manufacturing, and pharmaceuticals.
Way Forward
Promote alternative fuels: green ammonia, biofuels, hydrogen.
Strengthen public-private partnerships for shipbuilding innovation.
Push for a global transition fund to support clean maritime tech in developing countries.
Negotiate differential timelines for compliance based on income and capacity levels.
Exam Connect – Possible Questions
Prelims
1. The International Maritime Organisation (IMO) is a specialized agency under:
A. World Bank
B. World Trade Organization
C. United Nations
D. International Energy Agency|
Answer: C. United Nations
2. What percentage of global CO₂ emissions is contributed by the shipping industry approximately?
A. 1%
B. 2–3%
C. 5–6%
D. 10%
Answer: B. 2–3%
Mains
1. “The delay in global carbon-free shipping reflects the challenge of balancing economic interests and climate commitments.” Critically analyse the implications of this delay for global climate action and the principle of equity.
2. Discuss the role of the International Maritime Organisation (IMO) in regulating global emissions from shipping. What are the challenges in implementing a uniform carbon pricing mechanism across countries?
4. India’s Private Investment Puzzle: Growth Without Investment? – Economy
Why in News?
Despite strong real GDP growth rates, concerns are rising over the continued weakness in private sector investment in India. This is alarming for policymakers, as private investment is critical for long-term economic growth, job creation, and productivity enhancement.
What’s the Issue?
Investment-to-GDP Ratio Falling:
Gross Fixed Capital Formation (GFCF) has been consistently below 30% of GDP since 2014.
India’s growth is increasingly driven by consumption, not investment.
Lack of investment leads to slower job creation, weaker productivity gains, and long-term structural vulnerabilities.
GDP Components and the Role of Investment
India’s GDP is mainly composed of:
Private Consumption (~60%)
Investment (GFCF) – includes:
Private corporate investment (factories, machinery),
Public infrastructure projects (roads, ports),
Household investment (housing, livestock).
Why GFCF matters: It’s a key driver of productive capacity. A fall in GFCF means less economic capacity expansion.
Government Interventions So Far
Stimulus Measures Aimed at Boosting Investment:
Corporate Tax Cuts (2019) – Reduced to among the lowest globally to attract corporate investment.
Production-Linked Incentive (PLI) Scheme – Incentivizes manufacturing across sectors like electronics, pharma, and automobiles.
Massive Public Infrastructure Push – Roads, railways, renewable energy, logistics.
Ease of Doing Business Reforms – Labour law rationalization, digitization, FDI liberalization.
But Results Have Been Mixed:
Private sector response remains muted, especially in labour-intensive sectors.
Many companies are focusing on deleveraging (reducing debt) instead of expanding capacity.
Uncertainty in global markets, demand volatility, and weak consumption recovery are also contributing factors.
Implications of Weak Private Investment
Jobless Growth: Private investment is key for job creation, especially for India’s large young workforce.
High Burden on Government: Growth becomes heavily reliant on public spending, which is fiscally unsustainable in the long run.
Slower Poverty Reduction: Lack of broad-based growth may widen inequality and stall efforts to reduce poverty.
Underutilization of Demographic Dividend: Without productive employment opportunities, India risks missing its demographic window.
Why Is Private Investment Not Picking Up?
Demand Uncertainty: Businesses hesitant to invest without clear signals of strong consumer demand.
Banking Sector Constraints: Though improving, credit flow to private sector remains selective.
Global Economic Uncertainty: Geopolitical tensions, supply chain risks, interest rate fluctuations.
Policy Uncertainty: Fear of retrospective taxes, compliance burdens, and weak contract enforcement still linger.
What Can Be Done?
Enhance Predictability in Policy – Stable taxation and regulatory frameworks.
Targeted Credit Support – Priority sector lending and credit guarantee schemes.
Boost Rural Demand – Through employment programs and farm sector investment.
Strengthen Infrastructure Linkages – Logistics, energy, digital connectivity.
Public-Private Partnerships (PPPs) – Encourage risk-sharing models for large projects.
Exam Connect – Possible Questions
Prelims
1. What does the term Gross Fixed Capital Formation (GFCF) refer to in the context of national income accounting?
A. Total capital inflow from foreign investors
B. Total investment in financial assets
C. Net increase in physical assets within the economy
D. Increase in government revenue through taxation
Answer: C. Net increase in physical assets within the economy
2. Which of the following schemes was launched to incentivize domestic manufacturing and attract investment in India?
A. MGNREGA
B. Ujjwala Yojana
C. PLI Scheme
D. RTE Act
Answer: C. PLI Scheme
Mains
1. Despite robust GDP growth, private investment in India remains sluggish. Analyse the reasons for this trend and suggest policy measures to revive private sector investment.
2. Private investment is considered the key to sustained long-term growth. Critically evaluate the effectiveness of recent government initiatives in stimulating private capital formation in India.