SSC
The estimation of poverty in India has traditionally been based on surveys of household consumption expenditure conducted by the:
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Answer: Option A — National Statistical Office (NSO), formerly NSSO
Detailed Solution
In India, poverty has been measured mainly on the basis of household consumption expenditure, rather than income. This is because it is difficult to measure income accurately in a country where many people work in the informal sector, in agriculture or are self-employed. Data on how much households spend on food and non-food items each month is collected through large sample surveys.
These surveys were earlier conducted by the National Sample Survey Organisation (NSSO), set up in 1950 on the initiative of Professor P.C. Mahalanobis. In 2019, the NSSO was merged with the Central Statistics Office (CSO) to form the National Statistical Office (NSO), under the Ministry of Statistics and Programme Implementation (MoSPI).
Large-sample consumer expenditure surveys were usually conducted every five years. The data is used to calculate the Monthly Per Capita Consumption Expenditure (MPCE). The poverty line is set as a particular level of MPCE, and people whose consumption falls below this line are counted as poor. The poverty ratio, called the headcount ratio, is the percentage of the population below the poverty line.
Important surveys:
- The 68th round (2011-12) was the basis of the last official poverty estimates by the Planning Commission (Tendulkar method: 21.9%).
- The 2017-18 survey results were not released because of concerns about data quality.
The Household Consumption Expenditure Surveys (HCES) for 2022-23 and 2023-24 were released in 2024. They showed that the gap between rural and urban consumption had narrowed, and the average MPCE had risen.
Poverty estimation was formerly done by the Planning Commission. After it was replaced by NITI Aayog in 2015, NITI Aayog took up related work, including the National Multidimensional Poverty Index, which uses data from the National Family Health Survey (NFHS) instead of consumption data.
Other important surveys by the NSO include the Periodic Labour Force Survey (PLFS), started in 2017, which measures unemployment, and the Annual Survey of Industries.
Why not the other options?
- ✗The Reserve Bank of India deals with monetary policy and banking.
- ✗The Registrar General of India conducts the Census, which does not measure consumption.
- ✗The Central Board of Direct Taxes deals with income tax.
Quick tip
Remember: Poverty data = consumption expenditure surveys by the NSO (NSSO set up 1950, merged into NSO in 2019 under MoSPI); unemployment = PLFS (2017); MPI uses NFHS data.
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Poverty, Unemployment & Development — Preparation
This question tests your understanding of Poverty, Unemployment & Development, a key topic in the General Knowledge section. The detailed solution above uses a step-by-step approach to show the reasoning, and where available, a shortcut that helps you solve similar questions in under 90 seconds during the actual exam.
This topic covers the problems of the Indian economy and how they are measured: poverty and the poverty line, committees on poverty estimation, types of unemployment, human development indices, and the programmes designed to tackle poverty and unemployment. Questions often ask which committee estimated poverty (such as the Lakdawala, Tendulkar and Rangarajan committees), what disguised and seasonal unemployment mean, and which organisation publishes the Human Development Index (UNDP). Rankings and indices change every year, so check the latest reports for those questions. Practise the poverty, unemployment and development questions below, written in the style of the general awareness sections of exams such as SSC, banking, railways, CUET GAT, MAH CET and CLAT. Each question comes with a detailed explanation that adds related facts, so every question helps you revise more than one point.