An analysis done in the Planning Commission reveals that the anti-poverty programmes are leaky and inefficient, unable to lift Indians out of poverty. It shows India can close the poverty gap by spending just a fraction of its annual anti-poverty budget.

“The analysis shows our anti-poverty programmes are so leaky and inefficient that even after spending crores year after year, millions of Indians remain below the poverty line,” a highly placed official, associated with the analysis, told The Hindu.

“The government might as well lift everybody above the poverty line by simply giving them cash.”

Poverty gap is the amount of cash given to a household to lift it above the poverty line. It is the difference in the level of consumption of the households below the poverty line and those on the line.

The analysis uses the Tendulkar Poverty Line, according to which a household of five people subsists with a monthly consumption of Rs. 874.50. This poverty line is very close to the World Bank Poverty Line of an income of $1.25 a day (on a Purchasing Power Parity basis). Households with lower consumption levels are said to be below the poverty line or living on less than the bare minimum required to subsist.

India does not use household income levels for defining the poverty line for lack of official payroll data.

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