There is a growing divergence in the relationship between poverty and hunger in India. The shrinking of social expenditure by the government is forcing the poor to spend more on Non- Food essential items squeezing their food - budget.- Elucidate.

Introduction

India has made significant strides in poverty alleviation, with the poverty rate declining from 21.9% in 2011 to 10.2% in 2019 as per the World Bank. However, hunger and malnutrition persist, as highlighted by India’s rank of 107 out of 121 countries in the 2022 Global Hunger Index. This paradox reflects a growing divergence between poverty and hunger, driven by shrinking social sector expenditure and rising costs of non-food essentials.

Key Dimensions of Poverty-Hunger Divergence

Shrinking Social Expenditure and Its Impact

• Reduced Food Subsidies:

  • The National Food Security Act (NFSA) provides subsidized food grains to 67% of the population. However, the allocation for food subsidies has been reduced from ₹2.42 lakh crore in FY21 to ₹1.97 lakh crore in FY23.
  • This has led to higher out-of-pocket food expenses, especially for the poor.

• Inadequate Health and Education Spending:

  • India spends only 2.1% of GDP on health and 3% on education, far below the global averages of 6% and 4.5%, respectively.
  • Rising costs of healthcare and education force households to divert resources from food to these essential services.

• Decline in MGNREGA Allocation:

  • The budget for MGNREGA, a critical rural employment scheme, has been reduced from ₹98,000 crore in FY21 to ₹60,000 crore in FY23.
  • This has reduced rural incomes, further squeezing food budgets.

Rising Non-Food Expenditure and Its Consequences

• Healthcare Costs:

  • According to the National Health Accounts (2018), 63% of health expenditure in India is out-of-pocket.
  • Poor households often incur catastrophic health expenses, leaving little for food.

• Education Costs:

  • The rise of private schooling and associated costs (e.g., tuition, uniforms, books) has increased the financial burden on families.
  • This diverts resources from food consumption.

• Urbanization and Housing Costs:

  • Rapid urbanization has led to higher housing rents and utility costs, especially in urban slums.
  • This further reduces disposable income for food.

Implications of the Divergence

• Persisting Malnutrition:

  • India has the highest number of stunted children (35.5%) and wasted children (19.3%) globally, as per NFHS-5.
  • This reflects the inability of households to afford nutritious food.

• Widening Inequalities:

  • The poor are disproportionately affected, as they spend a larger share of their income on non-food essentials.
  • This exacerbates intergenerational poverty and hunger cycles.

Way Forward

• Increase Social Sector Spending:

  • Raise public expenditure on health to 2.5% of GDP and education to 6% of GDP, as recommended by the National Health Policy (2017) and the Kothari Commission.

• Strengthen Food Security Programs:

  • Expand the scope of PM Garib Kalyan Anna Yojana and ensure universal access to subsidized food grains.

• Focus on Livelihood Generation:

  • Enhance funding for MGNREGA and promote skill development programs to boost rural and urban incomes.

• Control Non-Food Costs:

  • Regulate healthcare and education costs through price caps and public-private partnerships.

Conclusion

Addressing the divergence between poverty and hunger requires a multi-pronged approach that prioritizes social sector investments and ensures affordable access to essential services. By aligning with SDG 1 (No Poverty) and SDG 2 (Zero Hunger), India can bridge this gap and ensure inclusive development.