According to the planning commission of India’s report of July 2013, the poverty rate has declined from 37.2 % to 22 % from 2004-2005 to 2011-2012. Accordingly, the numbers of poor are 269.3 million of which 80 % live in rural areas. These are, no doubts, are welcoming figure not only for Indians but also for the big enterprises as the consumer market is expanding.

However, there has been some criticism over the credibility of these figures as the poverty rates have been calculated based on Tendulkar methodology. Tendulkar methodology was devised by late Suresh Tendulkar, an Indian economist and former chief of National Statistical Commission. The primary concern of the methodology’s critiques is the poverty line fixed by it in terms of spending. The poverty line is fixed as the spending of Rs. 22.42 per person per day in rural areas and Rs. 28.65 in urban areas. There had been some real criticism over this methodology by BJP and other opposition parties like communist party as this methodology was adopted in 2004-2005 by Congress government.

However, situation is not that bleak as it seems. Congress snubbed the criticism by claiming that even if the methodology is wrong, there is no doubt in the reduction of poverty in India in these seven years. Congress also defended the methodology by mentioning the fact that Tendulkar methodology was multidimensional and also incorporates expenditures other than food. As a matter of fact, before 2004, the poverty line only took into account the expenditure on food calories. For rural India this number was 2,400 calories. For urban India this number was at 2,100 calories. Anyone consuming less than this was deemed to be poor.

Another notable fact is that when the multi-dimensional Tendulkar methodology was adapted in 2004-2005, poverty ratio went up from 27.5 percent to 37.2 percent and from then it came down to 22 % in 2011-2012. Hence, whether the methodology to measure poor people may be correct or not, there should be very less doubt that the poverty rate actually came down by almost 15-18 % in those seven years.

Ironically, the debate has led to nowhere in counting the actual number of poor in India. Nevertheless, the figures based on a study by Oxford in 2010 are alarmingly far more deviated from what Planning Commission of India has presented and present a totally different picture. The new index known as Multidimensional poverty index (MPI) has been developed by the Oxford Poverty and Human Development Initiative and UNDP. It will also replace the Human Poverty Index that has been used in the UNDP’s annual Human Development Report since 1997. According to the study based on MPI index, 55 % of India’s population, i.e. 645 million, is living under poverty.

As measured by the new index, half of the world’s poor are in South Asia (51 percent or 844 million people) and one quarter in Africa (28 per cent or 458 million). While poverty in Africa is often highlighted, the Oxford research found that there was more acute poverty in India than many African countries combined. Poverty in eight Indian states—Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Orissa, Rajasthan, Uttar Pradesh, and West Bengal—exceeded that of the 26 poorest African countries.

On the other hand, richer in India have amassed great wealth in the same era or from independence. According to Forbes list of US dollar billionaires in India jumped to 49 in 2010 than 24 in 2009.

Financial Express commented that year: “The wealth amassed by Indian billionaires—estimated at 340.9 billion dollars by the US business magazine Forbes—is nearly 31 percent of the country’s total GDP. This gives them nearly three times more weight in the economy than their American counterparts and over ten times of those in China. The GDP share of Indian billionaires’ wealth is more than four times of the global average.” Thecommented that year:“The wealth amassed by Indian billionaires—estimated at 340.9 billion dollars by the US business magazine Forbes—is nearly 31 percent of the country’s total GDP. This gives them nearly three times more weight in the economy than their American counterparts and over ten times of those in China. The GDP share of Indian billionaires’ wealth is more than four times of the global average.”