Wednesday, February 10, 2010
NEW DELHI: India is the biggest victim of financial crisis-induced poverty, according to data obtained by an Indian newspaper from the United Nations Department of Economic and Social Affairs' (UNDESA).
The UNDESA data estimates that the number of India's poor was 33.6 million higher in 2009 than would have been the case if the growth rates of the years from 2004 to 2007 had been maintained. In 2009 alone, an estimated 13.6 million more people in India became poor or remained in poverty than would have been the case at 2008 growth rates.
In other words, while a dip from the 8.8% growth in GDP averaged from 2004-05 to 2006-07 to the 6.7% estimated for 2008-09 may be nothing like the recession faced by the West, its human consequences for India were probably worse. The 2.1% decline in India's GDP growth rate has effectively translated into a 2.8% increase in the incidence of poverty.
According to the UNDESA's World Economic Situation and Prospects 2010, 47 million more people globally became poor or remained in poverty in 2009 than would have been the case at 2008 growth rates, and 84 million more than would have poor at 2004-7 growth rates. Of these, 19 and 40 million respectively are in south Asia.
The report uses the World Bank's definition of poverty, which is people living on less than $1.25 per day in 2005 Purchasing Power Parity (PPP) dollars.
The estimates assume that there has been no change in income distribution. If inequality grew in India in 2009, the number of poor would be even higher than these projections.
The UNDESA report attributes this increase in poverty to a combination of reduced household incomes, rising unemployment and pressure on public services. Job losses in India were primarily in export-oriented industries like textiles while employment levels in Indian firms catering to the domestic market were largely unaffected, the report says.
NEW DELHI: India is the biggest victim of financial crisis-induced poverty, according to data obtained by an Indian newspaper from the United Nations Department of Economic and Social Affairs' (UNDESA).
The UNDESA data estimates that the number of India's poor was 33.6 million higher in 2009 than would have been the case if the growth rates of the years from 2004 to 2007 had been maintained. In 2009 alone, an estimated 13.6 million more people in India became poor or remained in poverty than would have been the case at 2008 growth rates.
In other words, while a dip from the 8.8% growth in GDP averaged from 2004-05 to 2006-07 to the 6.7% estimated for 2008-09 may be nothing like the recession faced by the West, its human consequences for India were probably worse. The 2.1% decline in India's GDP growth rate has effectively translated into a 2.8% increase in the incidence of poverty.
According to the UNDESA's World Economic Situation and Prospects 2010, 47 million more people globally became poor or remained in poverty in 2009 than would have been the case at 2008 growth rates, and 84 million more than would have poor at 2004-7 growth rates. Of these, 19 and 40 million respectively are in south Asia.
The report uses the World Bank's definition of poverty, which is people living on less than $1.25 per day in 2005 Purchasing Power Parity (PPP) dollars.
The estimates assume that there has been no change in income distribution. If inequality grew in India in 2009, the number of poor would be even higher than these projections.
The UNDESA report attributes this increase in poverty to a combination of reduced household incomes, rising unemployment and pressure on public services. Job losses in India were primarily in export-oriented industries like textiles while employment levels in Indian firms catering to the domestic market were largely unaffected, the report says.
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