The hungry are the poorest of the poor; the link between hunger and poverty is well-established.Food security can, therefore, be accepted as the main criterion for assessing a poverty-free gram panchayat.
In the Union Budget 2017, the government announced its plan to make 50,000 gram panchayats poverty-free by 2019. It is undoubtedly a very good idea in the era of competitive federalism as it would set in motion a competition among gram panchayats to get rid of poverty.
Can one find a similar programme elsewhere in the country? Of course, yes.
In Sikkim, which became the first fully organic state of India in 2016 and is the only open-defecation-free state in the country, the government has plans to become a poverty-free state in four years. Going by the track record of the Sikkim government, nobody would ever doubt that this ambitious programme would be accomplished. However, the plan of making 50,000 poverty-free gram panchayats across the country in three years invites apprehension and strong reaction, and raises issues.
One of the important issues concerns the criteria to be adopted for assessing a poverty-free gram panchayat, and also the architecture to be put in place for measuring and monitoring progress and outcomes.
Poverty indicators
Indicators can help monitor progress towards this ambitious goal. A sound indicator framework will turn poverty-free gram panchayats and their targets into a management tool to help develop implementation strategies and allocate resources accordingly. It can also help prepare a report card to measure progress and ensure accountability of all stakeholders.
There must be a framework for measurable indicators. This framework, which should have data disaggregation – by income, sex, age, race, ethnicity, migratory status, disability and geographic location or other characteristics, will be fundamental to the efficient and effective implementation of the indicator framework.
Poverty is multi-faceted and has many root causes. In this context, it is pertinent to explore whether poverty can be perceived in terms of a single quantitative or qualitative indicator alone.
Food insecurity can be both a cause and effect of persistent poverty.
One of the sustainable development goals reads, “End hunger, achieve food security and improved nutrition and promote sustainable agriculture”.
In the United Nations document, Zero Hunger: Why It Matters, it has been argued that “extreme hunger and malnutrition remains a barrier to sustainable development and creates a trap from which people cannot easily escape”. This document further states that “hunger and malnutrition mean less productive individuals, who are more prone to disease and thus often unable to earn more and improve their livelihoods”. Additionally, it is said that “with hunger limiting human development, we will not be able to achieve the other sustainable development goals such as education, health and gender equality”.
In our fight against hunger and malnutrition, social protection systems have become an important tool. For promoting food security and nutrition, health and education, particularly for children, more than 100 countries implement conditional or unconditional cash transfer programmes.
Food distribution schemes and employment guarantee programmes also make significant contributions to tackling food insecurity. Assured, periodic and predictable cash transfers to poor households not only play a crucial role in bridging immediate food gaps but also improve their productive capacity.
It would thus be desirable that food security be accepted as the main criterion for assessing a poverty-free gram panchayat. It has to be appreciated that food insecurity in rural India continues to be a stark reality for a large number of households. Despite several successful policy interventions, the number of malnourished children and adults remains alarmingly high in rural areas. The hungry are the poorest of the poor; they have limited or no access to physical and financial assets, little or no education, and often suffer from ill health.
Dr A K Nigam and others (2016) in their study, titled ‘Hunger in Gram Panchayats of Banda District’, have classified all the gram panchayats in the district into three categories: (i) food secure (poverty-free); (ii) food insecure without hunger and; (iii) food insecure with hunger on the basis of MFAST which is a modified version of FAST (Food Access Survey Tools) and anthropometric measurements and related indicators.
The MFAST, with only nine indicators, can provide three types of food security status. The authors argue that mapping hunger would further enable zeroing down to the areas of concentration of deprived, hunger-stricken families. They also suggest that ‘Arc-view’ Geographical Information System software may be adapted for mapping food-secure (poverty-free) gram panchayats.
Food security, according to Nigam and others (2016), implies access, by all people at all times, to enough food for an active, healthy life.
Food security includes at a minimum (i) the ready availability of nutritionally adequate and safe foods and (ii) an assured ability to acquire acceptable foods in socially acceptable ways (i.e., without resorting to emergency food supplies, scavenging, stealing or other coping strategies).
In our endeavour to make poverty-free gram panchayats, the greatest challenge and opportunity would be to ensure access to food for the people who are living in extreme poverty and are most affected by hunger. This approach would not only enable the government to move forward in the path of ending hunger by achieving food security but also simultaneously contribute in a significant way in achieving other sustainable development goals such as in education, health and gender equality.
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Petrol in India is cheaper than in countries like Hong Kong, Germany and the UK but costlier than in China, Brazil, Japan, the US, Russia, Pakistan and Sri Lanka, a Bank of Baroda Economics Research report showed.
Rising fuel prices in India have led to considerable debate on which government, state or central, should be lowering their taxes to keep prices under control.
The rise in fuel prices is mainly due to the global price of crude oil (raw material for making petrol and diesel) going up. Further, a stronger dollar has added to the cost of crude oil.
Amongst comparable countries (per capita wise), prices in India are higher than those in Vietnam, Kenya, Ukraine, Bangladesh, Nepal, Pakistan, Sri Lanka, and Venezuela. Countries that are major oil producers have much lower prices.
In the report, the Philippines has a comparable petrol price but has a per capita income higher than India by over 50 per cent.
Countries which have a lower per capita income like Kenya, Bangladesh, Nepal, Pakistan, and Venezuela have much lower prices of petrol and hence are impacted less than India.
“Therefore there is still a strong case for the government to consider lowering the taxes on fuel to protect the interest of the people,” the report argued.
India is the world’s third-biggest oil consuming and importing nation. It imports 85 per cent of its oil needs and so prices retail fuel at import parity rates.
With the global surge in energy prices, the cost of producing petrol, diesel and other petroleum products also went up for oil companies in India.
They raised petrol and diesel prices by Rs 10 a litre in just over a fortnight beginning March 22 but hit a pause button soon after as the move faced criticism and the opposition parties asked the government to cut taxes instead.
India imports most of its oil from a group of countries called the ‘OPEC +’ (i.e, Iran, Iraq, Saudi Arabia, Venezuela, Kuwait, United Arab Emirates, Russia, etc), which produces 40% of the world’s crude oil.
As they have the power to dictate fuel supply and prices, their decision of limiting the global supply reduces supply in India, thus raising prices
The government charges about 167% tax (excise) on petrol and 129% on diesel as compared to US (20%), UK (62%), Italy and Germany (65%).
The abominable excise duty is 2/3rd of the cost, and the base price, dealer commission and freight form the rest.
Here is an approximate break-up (in Rs):
a)Base Price | 39 |
b)Freight | 0.34 |
c) Price Charged to Dealers = (a+b) | 39.34 |
d) Excise Duty | 40.17 |
e) Dealer Commission | 4.68 |
f) VAT | 25.35 |
g) Retail Selling Price | 109.54 |
Looked closely, much of the cost of petrol and diesel is due to higher tax rate by govt, specifically excise duty.
So the question is why government is not reducing the prices ?
India, being a developing country, it does require gigantic amount of funding for its infrastructure projects as well as welfare schemes.
However, we as a society is yet to be tax-compliant. Many people evade the direct tax and that’s the reason why govt’s hands are tied. Govt. needs the money to fund various programs and at the same time it is not generating enough revenue from direct taxes.
That’s the reason why, govt is bumping up its revenue through higher indirect taxes such as GST or excise duty as in the case of petrol and diesel.
Direct taxes are progressive as it taxes according to an individuals’ income however indirect tax such as excise duty or GST are regressive in the sense that the poorest of the poor and richest of the rich have to pay the same amount.
Does not matter, if you are an auto-driver or owner of a Mercedes, end of the day both pay the same price for petrol/diesel-that’s why it is regressive in nature.
But unlike direct tax where tax evasion is rampant, indirect tax can not be evaded due to their very nature and as long as huge no of Indians keep evading direct taxes, indirect tax such as excise duty will be difficult for the govt to reduce, because it may reduce the revenue and hamper may programs of the govt.