Question

Explain the method adopted by the Indian Council of Medical Research for calculating the poverty line.

Answer 1

Method of Indian Council of Medical Research:

• To ascertain minimum expenditure on all these items, the Indian Council of Medical Research during the initial years of planning calculated a minimum limit of calorie that a person needs to consume daily. Based on the calorie requirement the expenditure for items was then calculated.
• The Council calculated that a person belonging to a rural area must consume 2400 calories per day whereas that of urban, 2100.
• Later, even the Planning Commission accepted this method of ascertaining expenditure. By taking prices of year 1960-61 as base year, the Commission decided that ₹ 20 per day be set as minimum value for measurement of poverty or say poverty line. Thus, a person who earned less than ₹ 20 per day should be considered living below the poverty line or say should be called absolutely poor. Later, various people and committees revised the minimum value of poverty line