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Economic Survey 2020-21: “Bare necessities index” introduced

What is the News?

The Economic Survey 2020-21 has introduced the Bare Necessities Index(BNI).

Facts:

  1. Bare Necessities Index(BNI): This index is a means of assessing equity in economic development among states and regions in India. It uses the basic needs approach.
  2. Indicators: This index uses 26 indicators on five dimensions of basic necessities— water, sanitation, housing, micro-environment, and other facilities.
  3. Data Collection: The index has been created for all states based on data collected by the National Statistical Office(NSO) in 2012 and 2018.
  4. Range: The index classifies areas on three levels of access — high, medium, low — to bare necessities. The index has a range of 0 to 1 where 1 represents the best access to the basic necessities.

Key Findings:

  1. Richer vs Poorer States: The Poorer States have reduced the gap with rich States in providing access to the basics of daily life — housing, water, power, sanitation, cooking gas.
  2. Inter-State disparity in access to the basic necessities has declined in 2018, when compared to 2012.
  3. Performance of States: States such as Kerala, Punjab, Haryana, and Gujarat top the index.  While eastern Indian States of Odisha, Jharkhand, West Bengal, and Tripura have occupied the lowest positions.
  4. States which showed significant improvement include Uttarakhand, Rajasthan, Uttar Pradesh, Bihar, Madhya Pradesh, and Chhattisgarh.
  5. Richer vs Poorer Households: The access to basic necessities has improved significantly for the poorest households when compared to the richest households.
  6. The gap between Rural and Urban India: There is still a gap between urban and rural India as well as among income groups in access to basic necessities.

Suggestions:

  • There should be effective targeting of the government schemes for the poorer population in both urban or rural areas.
  • There should be better Centre-State coordination with local governments as they are responsible for civic amenities in urban areas.
  • The BNI could also be constructed at the district level using large annual household survey data to show progress.

Source: The Hindu

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