The creation of smaller states hasn't really helped in reducing poverty

We normally focus on data that comes out of survey research because we genuinely believe that ordinary folks are wiser and more evolved opinion and thought leaders than pundits of assorted hues.

But when we did a research based column on the new Multidimensional Poverty Index (MPI) released by the Niti Ayog towards the end of November, two things struck us: first, that we needed to conduct some serious field polling in the future to better understand real India.

The second, as the  co-author insisted, we must analyse this data and present some findings even if the media remains focused on electoral battle abuses, Hindu-Muslim binaries and celebrity weddings.

At the outset, we must commend the Niti Ayog for coming out with such a comprehensive and honest report that makes no effort to camouflage the warts and ugly scars of poverty in the country.

Traditionally, the poverty rate or ratio is measured by estimating the monthly consumption expenditure of a household. If the expenditure is less than $1.9 day, the family is categorised as living below the poverty line.

According to this estimate, about 7% of Indians are endemically poor. Even if you account for “creative accounting”, by the “system”, that’s a vast improvement over 21%-plus reported in 2011. Hopefully, we will get more credible numbers after Census 2021.

Also read: How its Left roots, migration history helped Kerala tide over poverty

The MPI, instead, relies on 12 human development parameters to estimate poverty. Interestingly, the all-India average for poverty as per the MPI is 25.1, far higher than the 7% suggested by traditional methods. The parameters used range from nutrition to school attendance to access to bank accounts. Since this not a research paper, we will skip the nitty-gritty.

While academicians and pundits will do their heavy lifting, we plebeians identified three trends that were probably already known but are still troubling. The first is the growing gap between the South and the Hindi heartland that is becoming yawning.

The second is massive inequality within states that have been rated as excellent or good performers in the MPI. The third is most intriguing — the creation of smaller states hasn’t really helped them when it comes to tackling acute poverty.

The first observation first. Every single state in the South reports an MPI that is way below the national average, with Kerala doing the honours with an MPI head count of 0.71 compared to the national average of 25.1%. Just four districts in the five states of South (two each in Telangana and Karnataka) report a poverty headcount that is higher than the national average.

Of course, Bihar takes the wooden spoon with an MPI headcount ratio of more than 51%. In Uttar Pradesh, 64 out of 71 districts report poverty headcounts higher than the national average.

The worst performing district in Kerala, Wayanad, represented by Rahul Gandhi, reports a headcount of 3.48. The best performing district in Madhya Pradesh is Indore with 10.86; Lucknow in Uttar Pradesh, represented by Defence Minister Rajnath Singh reports 12.16; Jhunjhunu is the best in Rajasthan with 12.8; Dhamtari in Chhattisgarh is the best with 18.57; Purbi Singhbum in Jharkhand is the best with 23.99% and finally Patna is the crown jewel of Bihar with a poverty headcount of 29.2%.

Remember we are not just talking of monthly consumption expenditure. We are talking of critical things like access to nutrition, maternal health facilities, schools, sanitation, water, electricity and other things that directly affect the quality of life.

Clearly, the South, for whatever reasons has invested in human capital while the Hindi heartland has not. Can this already yawning gap keep growing without any serious repercussions?

Talking of yawning gaps, we can discern them even within states that are considered good performers in the MPI. Telangana and Karnataka show this to a very limited extent. It is the western and northern states where the gap is glaring.

For instance, the worst performing district in Maharashtra is Nandurbar, with a poverty head count of 52.12 while the best performer is Mumbai with 3.59 score. Take Gujarat. The worst performing district is Dangs with a poverty head count of 57.33 while the best performing district Ahmedabad reports a head count of 5.57.

The most egregious example is seen in Haryana (with a statewide poverty head count of 14.5). District Mewat reports a headcount ratio of 63.18 while the richest district Ambala reports a headcount of 1.99, almost as good as Kerala.

A case for smaller states

What can be done to bridge these gaps? The Aspirational Districts programme for exactly this purpose was launched in January 2016. Six years down the road, there has been significant improvement. But as the data indicates, it is a work in progress.

That brings us to the most intriguing question: Will the creation of smaller states help? The authors are of the opinion that creation of small states is a necessity. Even the best chief minister in the history of modern democracy would find it extremely difficult to govern a huge state like Uttar Pradesh with a population of 240 million.

Uttarakhand (with an MPI poverty head count of 17.72 compared to 37.79 for Uttar Pradesh) seems to confirm our belief. But two more states were created along with Uttarakhand in 2000; Jharkhand out of Bihar and Chhattisgarh out of Madhya Pradesh.

More than 20 years down the line, they seem to have disappointed. No doubt they have performed better than their parent states, with Jharkhand reporting an MPI count of 42.16 compared to 51.91 for Bihar; and Chhattisgarh reporting 29.91 head count as against 36.65 for Madhya Pradesh.

Also read: Infographics & story | Over 50% of Bihar’s population poor: Niti poverty index

But neighbouring states like West Bengal (even though a large state with 42 Lok Sabha seats), Odisha and Telangana have performed far better. However, the fact that these states are performing better than their parent states is proof that conceptually the idea of carving out smaller states has highly tangible merits.

But that doesn’t mean just carving out smaller states is a magic wand. The new smaller states have had their own disappointments as well. Particularly disappointing is Jharkhand where more than 4 out of every 10 citizens is deprived of basic human development.

The most disappointing results are seen when we closely examine important parameters. For instance, more than 41% were deprived of cooking fuel, close to 40% of sanitation and more than 26% of maternal health.

But the saving grace is that Jharkhand seems to be the exception. Chhattisgarh has performed far better on the same parameters. Less than 30% are deprived of cooking fuel; just about one in four to sanitation and less than 17% to maternal health.

So what’s the message, not just for the newer states but also for the country as a whole. As Amartya Sen and countless other economists have repeated ad nauseam, the way out is to invest in things that improve the quality of human capital.

(Yashwant Deshmukh is Founder & Editor in Chief of C Voter Foundation and Sutanu Guru is Executive Director)