Time and time again, various expert groups have been appointed by the Planning Commission to estimate the poverty line in the Indian context. Following are the groups, their estimations, methodologies and their critical evaluations:

1. Working Group, 1962

Context and Objective:

A working group with eminent economists was constituted in 1962 by the Planning Commission to ascertain the minimum level of living for the India populace.

Methodology:

The Group seemed to have taken into account the recommendation of balanced diet made by the Nutrition Advisory Group of the Indian Council of Medical Research (ICMR) in 1958, however, the exact nutritional norm for arriving at the poverty line has not been articulated clearly.

The poverty line was computed by valuing a common basket of commodities at prices paid by the consumers, depending on where they resided. Thus, the methodology involved ascertaining separate poverty lines for rural and urban India in order to cover the higher prices of the physical volumes of commodities being noticed in urban areas, at that point of time. The estimations did not include expenditure on health and education, as they were assumed to be provided by the State, in accordance with the Indian Constitution and accounted for only those commodities that the households are expected to pay out of their own incomes.

Estimations:

The Group suggested that:

• For a household of 5 people with 4 adult consumption units, the national minimum consumption expenditure should not be less than INR 100 for rural areas and INR 125 for urban areas, per month as per 1960-61 prices.
• The per capita per month consumption expenditure should be not less than INR 20 in rural areas and INR 25 in urban areas at 1960-61 prices.

Evaluation:

The Group was the first step, in independent India to enumerate the poverty line in terms of a minimum food and non-food necessity of individuals for a healthy livelihood and it is in this context, that the group’s estimations must be appreciated. The aforementioned poverty line was widely used in the 1960s and 1970s to calculate the poverty ratio at the national level.

The critique of this evaluation manifests due to the modesty of its estimations in comparison to the one computed by KT Shah at 1938 prices, as TN Srinivas clearly states that the significant inflation between 1938 and 1960-61 isn’t reflected in the ascertained numbers.

Additionally, the poverty estimate is based on a head count measure of absolute poverty i.e. it counts as poor all persons who cannot afford to consume a particular basket of goods that is necessary for surviving and working, the construction of which is highly debatable.

2. Task Force, 1979

Context and Objective:

In 1977, a Task Force was appointed by the Planning commission, under the Chairmanship of Dr. Y.K Alagh, to inspect projections of minimum needs and effective consumption demand which submitted its report in 1979.

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Methodology:

The methodology entailed providing a quantitative measure of poverty by ascertaining the average calorie requirements, separately for the all-India rural and urban areas as a population–weighted average of the age-gender-activity specific calorie allowances recommended by the Nutrition Expert Group (1968) by reference to the 1971 population Census and then constructing a poverty line corresponding to the calorie requirement.

The projected calorie norm was 2400 kcal per capita per day in rural areas and 2100 kcal per capita per day in urban areas. To arrive at the monetary equivalent of these norms and the percentage of persons living below the poverty line, 28th Round (1973-74) NSS data relating to household consumption both in quantitative and value terms were used and adjusted pro-rata to correspond to the consumption estimates of National Accounts Statistics (NAS) made by the Central Statistical Office (CSO).