IMF paper praises India’s ‘N plan’ to alleviate extreme poverty

New Delhi: India has stopped the rise in extreme poverty through the Food Security Scheme. Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY), according to International Monetary Fund Report
Extreme poverty in India (PPP USD 1.9 per capita per day) is less than 1% in 2019, according to a new IMF paper.
Prime Minister Narendra Modi’s food security plan, Pradhan Mantri Garib Kalyan Anna Yojana, is important to prevent any increase in the level of extreme poverty in India during the Kovid-19 epidemic, the report added.
New IMF Papers, Epidemics, Poverty and Inequality: Evidence from India presents estimates of poverty (extreme poverty PPP USD 1.9 and PPP USD3.2) and consumption inequality in India for everyone in the years 2004-5 to 2020. -21.
These estimates include, for the first time, the impact of food subsidies on poverty and inequality. Extreme poverty was as low as 0.8 percent in the pre-pandemic year 2019, and food transportation was crucial to ensure that it remained at an all-time low in the 2020 epidemic year. The inequality of post-food subsidy is now very close at .294. Its lowest level in 1993/94 was 0.284.
Extreme levels of poverty, including two consecutive epidemics, can be considered as extreme poverty eradication.
PMGKAY was instrumental in curbing any increase in the level of extreme poverty in India and worked significantly to double food prices in terms of absorbing the Covid-19 induced income shock on the poor, the IMF report said.
Meanwhile, PM Modi last month announced the extension of PMGKY till September 2022. Under PMGKY, free foodgrains are provided to the needy.
The scheme was launched in March 2020 amid the Covid-19 epidemic in the country and was extended for four months (December 2021-March 2022) from November 2022 to November last year.
The scheme provides 5 kg of foodgrains per person per month in excess of the regular monthly NFSA food and above.
National Food Security Act (NFSA)[અંતોદય’હેઠળઆવરીલેવાયેલાલોકોનેઆલાભઆપવામાંઆવીરહ્યોછે[Antodaya Anna Yojana And priority houses]which are covered under Direct Benefit Transfer (DBT).
The government announced in March 2020 the distribution of additional free foodgrains (rice / wheat) to about 800 million National Food Security Act (NFSA) beneficiaries following the situation created by COVID-19 so that vulnerable families do not suffer due to insufficient foodgrains.
The epidemic shock is largely a temporary revenue shock, the IMF report said, adding that temporary fiscal policy intervention is a financially viable way to absorb most of the shock.
Consumption growth (a key determinant of poverty) was found to be higher in 2014-19 than the strong growth seen in 2004-2011.
The paper examined in some detail the rationality of the results contained in the 2017-18 NSS Consumer Expenditure Survey, the report added.


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