Thiruvananthapuram: The Planning Commission’s latest poverty estimates, which showed a dramatic fall in poverty from 37.2 percent to 21.9 percent, have sprung a surprise for Kerala. For the first time in history, a state’s rural poverty line has been pegged higher than its urban poverty line.
The new estimate draws Kerala’s urban poverty line at Rs 987 per month. It’s rural poverty line is Rs 1,018. This means that if Rs 1,018 a month is the minimum level of income considered adequate in rural areas, a Malayali can make do with even less in urban areas; an indication that rural areas in the state have a higher standard of living than urban.
“It can never happen. It could be a printing howler,” former finance minister Dr Thomas Isaac said. However, a note passed on by the Planning Commission to the State Planning Board confirms the new demographic. Four reasons have been offered.
One, for category-I items (cereals, pulses, milk, oil, egg-fish-meat, vegetables, fresh fruit, dry fruit, sugar, salt-spices, other-food, beverages and tobacco, fuel-light, clothing, footwear), the prices in urban areas are much higher than rural areas in most of the states. This difference is very low, only five percent, for Kerala; in Karnataka it is 16 percent, in Uttar Pradesh 21 percent.
Two, for category-II items (entertainment, personal care items, miscellaneous goods, miscellaneous services and durables), the increase in prices in urban areas is lower than in rural areas in most of the states. But the rise in prices of category-II items is considerably huge in Kerala’s rural areas.
Three, the difference in urban and rural poverty lines for Kerala was already low in 2004-05; the urban poverty line was only nine percent above the rural line. This also means that there was massive urbanisation of rural areas post-2005.
Perhaps the most important factor, the commission notes, is the definition of rural areas accepted by the National Sample Survey Organisation. “The areas identified by NSSO as rural has characteristics of urban areas and are in many cases treated as urban by the census,” it says.