Tuesday, 28 September, 2021

Reducing Multidimensional Poverty

Uttam Maharjan

Poverty is one of the challenges poor countries like Nepal have been struggling to slough off for years. Since the introduction of the periodic plan in the country, efforts have been made to reduce poverty. It would be gratifying to note that these efforts have paid off convincingly. In the past, poverty was considered a single dimensional factor. It used to be measured in monetary terms based on income. Now, poverty is viewed from various angles. No single indicator can define poverty. It is measured on the basis of various indicators like poor health, lack of education, inadequate living standards, lack of empowerment, poor quality of work, threat of violence and hazardous living conditions.

As per the report entitled The Nepal Multidimensional Poverty Index: Analysis towards Action released by the National Planning Commission the other day, a whopping 3.1 million people were lifted out of multidimensional poverty in five years during the 2014-2019 period. The report was prepared in collaboration with Oxford/OPHI, UNDP and UNICEF. The report was based on the Nepal Multiple Indicator Cluster Survey Report 2019.

Declining poverty index
In 2014, the percentage of people who were multidimensionally poor was 30.1, which came hurtling down to 17.4 per cent in 2019. The multidimensional poverty index also came down from 0.133 in 2014 to 0.074 in 2019. The multidimensional poverty index is based on three sectors and 10 sub-sectors: health (child mortality and nutrition), education (years of schooling and school attendance) and living standards (drinking water, sanitation, electricity, cooking fuel, housing and asset). In a similar vein, the intensity of multidimensional poverty came down from 44.2 per cent in 2014 to 42.5 per cent in 2019.

As per the report, the highest number of people was deprived of housing materials, clean cooking fuel, schooling, assets and nutrition. The report found schooling and nutrition as major deprivations contributing to multidimensional poverty. The incidence of multidimensional poverty was disproportionate between urban and rural areas. In rural areas, 28 per cent of people were multidimenstionally poor, while only 12.3 of urbanites were multidimensionally poor. This shows the patterns of lopsided development in the country. Although there are three tiers of government, federal, state and local, the development patterns are yet to change and rural development is still a far cry.

State-wise, the Karnali state was the poorest state with 39.5 per cent of people multidimensionally poor, whereas the percentage of such people in the Bagmati state was 7 per cent. Demographically, children were the poorest lot; 21.8 per cent of children under 18 were multidimensionally poor vis-à-vis adults, 15 per cent of whom were multidimensionally poor. In the country, children constitute 44 per cent of the total population.
It is good news that Nepal has been making great strides on the poverty reduction front. Now there are 4.9 million people (17.4 per cent of the total population) that are waiting to be lifted out of the multidimensional poverty trap. The rate of poverty reduction in the country is faster than many other countries, which is a matter of gratification. There was progress on each of the ten multidimensional poverty indicators, especially in cooking fuel, sanitation, housing, schooling and nutrition. Still, there is a long way to go before poverty can be completely eliminated as China did a few months ago.
The report, however, did not take into consideration the impact of COVID-19 on multidimensional poverty as it is based on the Nepal Multiple Indicator Cluster Survey Report 2019 that covered the 2014-2019 pre-pandemic scenario. The pandemic broke out in December 2019.

The impact of COVID-19 on the national economy of the country is evident. Almost every sector is in the clutches of the pandemic owing to lockdowns or restrictions. Educational institutions, the hospitality industry (restaurants, hotels, etc.), party palaces, cinema halls, gyms and other sectors have still remained closed. This has deprived most people of jobs with the result that their earning capacity has dwindled, plunging them into poverty.

It is surmised that because of COVID-19, 18 million people, or 63.5 per cent of the total population, have faced at least one of COVID-related deprivations like nutrition, water and cooking fuel. It is poor people that are affected the most by the pandemic. They have to live in overcrowded conditions, which are a breeding ground for the pandemic. Lack of technology like internet connection is a setback in the imparting of education to children from poor families. Lack of hand washing facilities among 38.2 per cent of people has made them vulnerable to the pandemic. That 65.2 per cent of the multidimensionally poor hand washing facilities is alarming at a time when the pandemic is raging across the country.

Relief packages
It is feared that the COVID-19 pandemic could undo the gains on the front of poverty alleviation made over the years. Such gains need to be perpetuated at any cost. The government should, therefore, closely assess the situation and bring out relief packages designed for reviving the economy with a special focus on the uplift of the poor. At the same time, the government should pay heed to the development of poor states like Karnali. The development model should be such that it will bring out balanced development in all the states. Where needed, even the concept of positive discrimination should be applied. The Kathmandu-centric development model cannot lead the country on the path of overall development. After all, poverty reduction by half is one of the SDGS, towards which the country has been darting.

(Former banker, Maharjan has been regularly writing on contemporary issues for this daily since 2000. uttam.maharjan1964@gmail.com)