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Question

Extreme poverty in India dropped to 10.2% in the pre-Covid year of 2019 from as much as 22.5% in 2011 and the pace of reduction in rural India has been more dramatic than in urban areas, according to a World Bank working paper. The poverty level in rural and urban areas declined by 14.7 and 7.9 percentage points, respectively, during the 2011-2019 period. While it eased to 11.6% in rural areas in 2019, the urban poverty level stood at 6.3%. Extreme poverty has been measured in terms of the number of people living on less than $1.90 a day (roughly Rs 145). Interestingly, urban poverty inched up by 2 percentage points in the demonetisation year of 2016 and rural poverty rose by 10 basis points in 2019 (coinciding with an economic slowdown before the Covid spread its tentacles), the paper showed. The World Bank working paper, titled Poverty in India Has Declined over the Last Decade But Not As Much As Previously Thought, has been authored by economists Sutirtha Sinha Roy and Roy van der Weide. This is the second working paper released this month, under the aegis of multilateral agencies, that gauged poverty reduction in India. An IMF working paper authored by economists Surjit Bhalla, Karan Bhasin and Arvind Virmani recently suggested that extreme poverty in India was as low as 0.8% in 2019 and the country managed to keep it at that level in 2020 despite the pandemic, by resorting to food transfers through the Pradhan Mantri Garib Kalyan Yojana.

Which of the following correctly describes Churning Poor?

A people who are always poor Correct Answer Incorrect Answer
B those who are usually poor Correct Answer Incorrect Answer
C who regularly move in and out of poverty Correct Answer Incorrect Answer
D who are rich most of the time but may sometimes have a patch of bad luck Correct Answer Incorrect Answer
E None of the above Correct Answer Incorrect Answer

Solution

There are many ways to categorise poverty. In one such way people who are always poor and those who are usually poor but who may sometimes have a little more money (example: casual workers) are grouped together as the chronic poor. Another group are the churning poor who regularly move in and out of poverty (example: small farmers and seasonal workers) and the occasionally poor who are rich most of the time but may sometimes have a patch of bad luck. They are called the transient poor. And then, there are those who are never poor.

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