Regional estimates of multidimensional poverty in India

Using unit data from the Indian Human Development Survey (IHDS), 2004-05, this paper estimates and decompose the multidimensional poverty dynamics in 84 natural regions of India. Multidimensional poverty is measured in the dimensions of health, knowledge, income, employment and household environment using ten indicators and Alkire-Foster methodology. The unique contributions of the paper are inclusion of a direct economic variable (consumption expenditure) to quantify the living standard dimension, decomposition of MPI across the dimensions and the indicators and provide estimates at sub-national level. Results indicate that about half of India's population are multidimensional poor with large regional variations. More than 70% of the population are multidimensional poor in the Mahanadi Basin, the southern region of Chhattisgarh and the Vindhya region of Madhya Pradesh, while it is less than 10% in the coastal regions of Maharashtra, Delhi, Goa, the mountainous region of Jammu and Kashmir, the Hills region and Plains region of Manipur, Puducherry and Sikkim. The decomposition of MPI indicates that economic dimension alone accounts for about one-third of multidimensional poverty in most of the regions of India. Based on these analyses, the authors suggest target based interventions in the poor regions to reduce poverty and inequality, and achieve the Millennium Development Goals in India.