Before taking a look at Budget 2023, let us take a look at the economic situation in the country, in the background of which the FM presented her budget.

The GDP Conundrum

The FM begins her 2023 Budget Speech with typical Modi-style bombast: “In the 75th year of our Independence, the world has recognised the Indian economy as a ‘bright star’. Our current year’s economic growth is estimated to be at 7%. It is notable that this is the highest among all the major economies. This is in spite of the massive slowdown globally caused by Covid-19 and a war. The Indian economy is therefore on the right track, and despite a time of challenges, heading towards a bright future.” Last year too, the FM had claimed that India’s economic growth rate (9.2% for 2021–22) was the highest among all large economies.

At the very outset, we’d like to point out that there are several limitations with the concept of GDP, especially in today’s times of neoliberalism, and that it does not really measure how well the people are doing.[1] But let us for the moment keep this aside and consider how well the economy is doing as per the Modi Government’s definition of economic growth.

Before we begin our analysis of the above projections about India’s GDP growth rate made by our FM, let us go back a bit into the past, to the financial year 2019–20, just before the pandemic struck. That, plus the economy’s performance in the post-pandemic period, would give us an idea of the overall health of the economy during the Modi years.

In her Budget speech of 2020, FM Nirmala Sitharaman loftily claimed that the average annual GDP growth during the Modi years was significantly higher than the growth rate of 6% achieved during the 1980s and 90s. Let us examine this more closely.

According to official statistics released by the Modi Government, the average GDP growth rate during the 5-year period 2015–16 to 2019–20 was 6.7% (Table 2).

Table 2: GDP Growth Rate Before the Pandemic, 2015–16 to 2019–20 (%)

	2015–16	2016–17	2017–18	2018–19	2019–20
GDP Growth Rate (%)	8	8.3	6.8	6.5	3.7

Now, GDP is supposed to measure the value of goods and services produced by a nation. Therefore, GDP growth figures should be in consonance with figures related to the growth in the production and supply of key goods and services. But none of the important indicators for the period 2015–16 to 2019–20 are in conformity with the average GDP growth rate of 6.7% for this period. They are at least 2 to 3 percentage points below the GDP growth rate. We give some of these indicators in Table 3.[2]

Table 3: Average Annual Growth in Output of Key Goods and Services,

2015–16 to 2019–20 (%)

	2015–16 to 2019–20
Electricity Generation growth per year	4.6
Growth of Per capita electricity consumption per year	3.6
Growth of Index of Industrial Production (annual average)	2.8
Coal output growth (annual average)	3.5
Cement output growth (annual average)	4.3
Steel output growth (annual average)	4.6
Passenger vehicle sales growth (annual average)	1.3
Two wheeler sales growth (annual average)	1.7
Average annual growth in Bank credit to industry (inflation adjusted terms)	–2.1

The conclusion is inescapable, that our GDP growth rate for the 5-year period 2015–16 to 2019–20 is exaggerated, by at least 2 percentage points. It only means that the Modi Government has indulged in manipulation of data.

This is precisely what has happened. We have given details about this manipulation in a previous article in Janata Weekly. This process began soon after the Modi Government assumed power. In 2015, the Central Statistical Organisation (CSO, the government agency responsible for co-ordination of statistical activities in India) revised the methodology for calculating GDP and magically upped the GDP growth rate by 2 percentage points, making India the world’s fastest major economy. After that, the CSO repeatedly played around with GDP figures right up to 2019, to make it appear that the GDP growth rate during Modi’s first term was significantly higher than the growth rate achieved during the previous UPA government.[3]

This manipulation has also been admitted by Arvind Subramanian, who was the Modi Government’s Chief Economic Advisor from 2014 to 2018. Of course, he stayed silent while in power. After submitting his resignation he probably felt a surge of remorse. In a working paper published in June 2019, he stated that India’s GDP was overestimated by 2.5 percentage points.[4]

There is a limit to how much you can manipulate data. As the economic situation worsened during the Modi years, finally, even the CSO was forced to admit that the economy was not doing well. The CSO’s latest figures show that the economy began slowing down after 2016–17, and by 2019–20, the growth rate had fallen to just 3.7%, an 11-year low (Table 2). And since these figures are after the CSO’s gaslighting of data, it means that the actual growth rate was considerably lower than this!

After that, the pandemic struck, and the Modi Government’s inept handling of the pandemic led to an unprecedented economic collapse. While official data shows that the economy contracted by 6.6%, actual contraction was far more than this as it does not include data for the unorganised sector (more on this later) — and this sector suffered a massive decline. India witnessed perhaps the sharpest absolute drop in GDP among the major economies of the world in 2020-21.[5]

In the subsequent years, there has been some recovery from the deep abyss into which the economy had fallen. Official figures estimate GDP growth to be 8.7% in 2021–22; and the FM expects growth to be slightly lower at 7% in the year 2022–23.

Table 4: GDP, 2019–20 to 2022–23 (Rs cr)

	2019–20 (1)	2020–21	2021–22 (2)	2022–23 (3)	Growth rate (3 over 2), %	Growth rate (3 over 1), % [CAGR]
GDP at Constant Prices	145,15,958	135,58,473	147,35,515	157,60,363	6.95	2.78

Even though the economy is slowing down, the FM is happy that the economy’s rate of growth is the highest among the major economies. But the economy’s growth rate of 7% for the year 2022–23 is actually a deceptive statistic. It does not give a good idea of how well the economy is doing on the whole, as this growth rate is coming after a sharp decline in 2020–21 due to the pandemic. A more accurate measure of how well the economy is doing is to measure how much our GDP has increased with respect to the pre-pandemic year of 2019–20. As Table 4 shows, the average growth rate (CAGR) of GDP over the past three years (2022–23 as compared to 2019–20) is just 2.78%. This is hardly indicative of the economy being a “bright star” in the world.

Furthermore, even this small rise in GDP of 2.8% is actually exaggerated. As mentioned above, Modi Government’s GDP growth rate estimate is based on data available for the organised sector only. It does not include data for the unorganised sector, except for agriculture (for which data is available). For this part of the unorganised sector, the data needs to be collected by ground surveys, which the Modi Government has simply not done despite the devastation unleashed on this sector by the triple whammy of demonetisation, GST, and the government’s callous handling of the Corona pandemic — that led to a total collapse of the unorganised sector. All indications are that the non-agricultural unorganised sector, that contributes to roughly 31% of GDP and nearly 50% of the total employment, is actually in decline, that is, has a negative growth rate. So the actual growth rate for the economy as a whole may be close to zero.[6]

Worse, even this meagre growth rate is not expected to sustain in 2023-24. The Government expects India to grow at between 6 to 6.8% in 2023-24, according to the Economic Survey 2022-23. Almost all international agencies have downgraded their growth rate forecasts for India for 2023-24: the IMF has lowered it to 5.9% from its earlier projection of 6.1%, while the World Bank has revised its forecast to 6.3% from 6.6% made earlier.[7]

At the same time, the economy has been badly hit by inflation. The inflation rate as measured by the consumer price index was 5.13% in 2021, and further went up to 7.7% in 2022. On the other hand, if measured by the wholesale price index, it was even higher at 15%. Combining this with the continuing slowdown in the economy implies that the economy is actually in stagflation.[8]

Deepening Unemployment Crisis

The Modi Government is in denial about the unemployment crisis gripping the country. The Economic Survey 2022–23 claims that “Labour markets have recovered beyond pre-Covid levels, in both urban and rural areas, with unemployment rates falling from 5.8% in 2018–19 to 4.2% in 2020–21.” The Finance Minister’s budget speech does not even mention the word ‘unemployment’, and only says that the budget is taking the lead in ramping up job creation — without giving any numbers.

The figures put out by the Economic Survey are based on Periodic Labour Force Survey (PLFS) data released by the National Sample Survey Office (NSSO). The problem is, the Modi Government’s frequent interference in the country’s statistical system, frequent changes in methodology of the surveys, suppression and delay in release of data — all have put the credibility of NSSO data under a cloud. Here is a brief history of the Modi Government’s interference in the country’s unemployment statistics.

During the first term of the Modi Government, in September 2016, data from the fifth round of the Annual Employment–Unemployment Survey (EUS) was released. This report showed that unemployment rate in India had gone up to a five-year high of 5% in 2015–16. The government panicked, and not only scrapped all subsequent Annual EU Surveys, but also the quinquennial Employment–Unemployment Survey conducted by the NSSO — whose next round was due in 2016–17. This survey on employment and unemployment had been conducted regularly every five years since 1972–73 in rural and urban areas, and provided extensive information about the volume and structure of employment and unemployment in the country, and also about several other indicators of the quality of workers and non-workers.

Consequent to the scrapping of these surveys, the government released no official data on the unemployment situation in the country for the next three years. Subsequently, in 2017, it instituted another employment survey, the PLFS, to be done by the NSSO. This survey was conducted between July 2017 and June 2018. But with Lok Sabha elections coming, the Modi Government decided to withhold the release of this data too. It did so despite the National Statistical Commission (NSC) — the apex body that coordinates India’s statistical activities — approving its release. The NSC is an autonomous body; the government is not supposed to interfere in its functioning. In protest, on 28 January 2019, the last two independent members of the NSC, one of whom was also the acting chairman, resigned.

Finally, after the 2019 Lok Sabha elections were done and dusted with, the Government released the suppressed PLFS data. The data showed that joblessness was at a 45-year high of 6.1% in 2017–18 (the Centre has been collecting unemployment data since the early 1970s). Worse, they showed that instead of creation of more jobs, the total number of jobs in the economy had actually fallen during the period 2011–18 — from 47.42 crore in 2011–12 to 46.51 crore in 2017–18 (Table 5).[9] This is the first time this has happened since independence.

Table 5: Total Employment, 2012 to 2018

	Total Employment (in million)
2011–12	474.2
2017–18	465.0

In all probability, the Modi Government now tweaked the data collection methodology. This suspicion arises because even though the country’s GDP growth rate has been slowing down since 2017–18, data put out by subsequent PLFS surveys show an increase in the Labour Force Participation Rate (LFPR) and a decline in the unemployment rate between 2017–18 and 2020–21, (Table 6)! [LFPR is the percentage of working-age population engaged in work or making tangible efforts to seek ‘work’.] The PLFS data show a decline in unemployment even during the pandemic year 2020–21, a year when even official figures show that the economy contracted by 6.6% (and the informal sector, that accounts for 91% of employment, had suffered a total collapse). The country is having ‘growthless employment’![10]

Table 6: LFPR, UR and GDP Growth Rate, 2017–18 to 2020–21[11]

	2017–18	2018–19	2019–20	2020–21
Labour Force Participation Rate (%)	36.9	37.5	40.1	41.6
Unemployment Rate (%)	6.1	5.8	4.8	4.2
GDP Growth Rate (%)	6.8	6.5	3.7	–6.6

Facts on the ground also belie Modi Government’s Goebbelsian claims. Just a year ago, there were job riots twice within the space of six months in UP and Bihar — first over delay and irregularities in the railway recruitment examination, and then against the Agnipath scheme. The roots of these riots obviously lie in the worsening unemployment situation. The horrendous state of unemployment and underemployment in the country is also revealed in a reply given by the minister of state in the Ministry of Personnel, Public Grievances and Pensions in Parliament on 27 July 2022. The minister stated that between 2014 and 2022, a staggering 22.06 crore applications for jobs were received by the Central government, out of which 7.22 lakh persons were recruited. According to the data provided by the minister, in 2020–21, 1.8 crore persons applied for jobs with the Central government, while 78,000 recruitments were made, and in 2021–22, 1.87 crore applications were received and 38,000 recruitments made.[12] Yet PLFS unemployment data shows that only 2.81 crore people were unemployed in 2019–20! The facts given above clearly show that there has been no decline in the unemployment crisis in the post-Covid years as claimed by the government.

Another important data source about the employment and unemployment situation in India is the household survey data put out by the CMIE (Centre for Monitoring Indian Economy, a leading private business information company). Table 7 gives the unemployment rate in the country according to the CMIE (we have calculated the yearly figures by averaging the monthly unemployment rate given out by the CMIE). These unemployment figures are clearly closer to reality. They indicate that unemployment was at a historic high of 10% in 2020–21 — obviously because of the impact of the corona pandemic and the lockdown. The marginal recovery from the economic collapse (as discussed above) has led to a slight decline in the unemployment rate, to 8% in 2021–22. CMIE data show that unemployment continues to be at a high of between 7 to 8% in 2022–23 too.[13]

Table 7: Unemployment Rate (CMIE data), 2017–18 to 2021–22

	2017–18	2018–19	2019–20	2020–21	2021–22
Unemployment Rate (%)	4.6%	6.4%	7.6%	10%	8%

Even this high unemployment rate is a huge underestimate. The unemployment crisis gripping the country is far more worse, for two reasons.

Reason One

The first reason becomes clear just by delving deeper into CMIE data.

Table 8: Total Employed in Economy, 2016 to 2022 (in ’000)[14]

Period	Population >=15 yrs, <=65 yrs	Employed
Sept–Dec 2016	899,284	396,703
Sept–Dec 2019	960,051	398,438
Sept–Dec 2022	1,036,699	398,810

Comparing CMIE tri-monthly data (September–December) for the years 2016, 2019 and 2022 reveals that over the period 2016 to 2022 (see Table 8), while India’s total working-age population (defined as between age 15 and 65 years) has increased by 15%, from 89.93 crores to 103.67 crores, the total number of employed remained virtually stagnant, increasing by a mere 0.53% — from 39.67 crore to 39.88 crore. In end-2022, of 103.67 crore people of working age, only 39.88 crore were employed. The employment rate (Total number of people employed / Total working age population) is at a lowly 38.5%, amongst the lowest in the world. It is even lower than our neighbours Pakistan (48%) and Bangladesh (53%).The global employment rate is 56%, and it goes up to a huge 70+% in the developed countries.[15]

The reason why India’s employment rate is so low is because of the country’s huge unemployment crisis. There are simply no jobs. Consequently, many workers have simply given up looking for jobs out of frustration — because they have not been able to find a job for a long time. In official parlance, they are known as ‘discouraged workers’; such workers are not included in the official figures of the unemployed, nor are they included in the labour force.

The total number of employed in India would need to go up by [103.67 x (56 – 38.5)/100 =] 18.18 crore for India’s employment rate to reach the global average. This means that at least 17.5% people of working age have dropped out of the labour force out of frustration (the actual number would be more as the global average also does not include the discouraged workers). Including them in the number of unemployed would send the unemployment rate soaring.

Reason Two

Even the fabricated data of the Economic Survey 2021–22 cannot hide the fact that total formal organised jobs — what can be called decent jobs with job security and living wages — constitute only 9% of the total jobs in the economy (5.09 crore out of 53.53 crore). The remaining 91% are informal jobs in the unorganised sector. As we have analysed elsewhere[16], the overwhelming majority of these workers either work in insecure low-paid jobs with no social security, like in the construction sector or in roadside eateries or in tiny enterprises, or they are self-employed — as street vendors selling idlis or pani-puris or vegetables by the roadside, as rickshaw pullers and autorickshaw drivers, etc. — and earn barely enough to eke out a living. Why do the people work in such low-paying insecure jobs? Because there is no unemployment allowance in the country. So people have the option of either starving, or are forced to take up whatever jobs are available, or do any kind of work, to somehow earn something and stay alive.

All the unemployment surveys in India, be it the NSSO survey or the CMIE survey, consider all these workers in the informal sector to be ‘gainfully employed’, even if they are earning subsistence level wages. Calling these people employed is actually ridiculous; they are all victims of an economy that is unable to create decent jobs. Any humane society would consider them to be unemployed, or at least under-employed. International covenants such as ‘The International Covenant on Economic, Social and Cultural Rights’, and our own Constitution explicitly state that all workers have a right to a decent job that ensures them and their families a life of dignity. This means that all workers whose earnings are so low that they are able to provide only the bare necessities of life should be recognised as ‘under-employed’ and included in the unemployed.

If we include the discouraged workers and the underemployed in the total number of unemployed in the country, the unemployment rate would go up to unimaginable levels — 50 to 60%, or even more! Terrible figures indeed. India’s unemployment crisis is among the worst in the world.

Abysmal Poverty Figures

With such high unemployment levels, with most jobs available in the economy being low paid jobs providing incomes barely enough to meet basic needs, and with little social security available to the poor due to the Modi government’s low social sector expenditures, the country’s poverty levels must be very high.

And so just as it did with unemployment data, the Modi Government has stopped the release of economic data related to poverty levels in the country. The most important dataset that provided information on household consumption patterns and levels, and thus enabled analysis of poverty levels in the country, was the Household Consumer Expenditure Survey (CES) that was carried out every five years by the NSSO. The last such survey data officially available are for 2011–12; the 2017–18 survey was carried out, but the Modi Government suppressed the data. The reason for the suppression became evident when the data got leaked, and Business Standard published it. The suppressed data show that the monthly per capita consumption expenditure, meaning the average amount of money spent by an Indian in a month, adjusted for inflation, fell by 3.7% over the period 2011–12 to 2017–18: from Rs 1,501 in 2011–12 to Rs 1,446 in 2017–18. This is the first time in five decades that consumer spending has fallen in the country, implying that poverty levels are increasing.[17]

Since then, no new CES survey has taken place. The only data available are the Periodic Labour Force Surveys (PLFS), whose primary objective is to estimate the labour force participation. The PLFS also collects data on consumption expenditure of households, but this data has several constraints.[18] We have also pointed out above that in all probability, the PLFS data has been suitably massaged by the Modi Government to present a rosy picture of the economy. We showed this with regards to unemployment data based on PLFS surveys; the same is also happening with poverty estimates. Based on PLFS data, a recent paper by two ‘reputed’ mainstream economists has come up with the credulity-stretching claim that poverty in the country declined even during the pandemic year 2020–21![19] All that we can say in the face of such data is that: India had managed to build one of the best statistical systems in the developing world; unfortunately, the narcissist Modi Government is now destroying it.[20]

Then how do we estimate poverty levels in the country?

First, we need to make a more realistic estimate of the country’s poverty line. If we make use of World Bank’s poverty line of $2.15 per day for low income countries, this for India works out to a poverty line of Rs 7,500 per month for a family of five for the year 2018.[21]

The Anoop Satpathy committee set up by the Ministry of Labour and Employment which submitted its report to the government in 2019 had recommended a national minimum wage of Rs 375 per day (Rs 9,750 per month). The committee based its recommendations on nutritional requirement norms as recommended by the ICMR, and also took into consideration reasonable expenditure on ‘essential non-food items’, such as clothing, fuel and light, education, medical expenses, and transport, to arrive at this figure.[22]

Both these lines are similar. We can consider the country’s poverty line to be between Rs 8,000 to Rs 10,000 per month.

The last available reliable dataset on the condition of the people in the country is the Labour Bureau’s Fifth Annual Employment–Unemployment Survey released in September 2016. A study based on this survey data found that of the total workforce in the country (see Table 9):

• 4 percent people earned less than Rs 5,000 per month; and
• 1 percent people earned less than Rs 10,000 per month.[23]

Table 9: Types of Employment and Monthly Earnings, 2015–16 (in %)

	Self-employed	Wage/Salary Earners	Contract Workers	Casual Labourers	Total
% of Workforce	46.6	17.0	3.7	32.8	100
Monthly Earnings					As % of total employment
Less than Rs 5,000	41.3	18.7	38.5	59.3	43.4
Less than Rs 10,000	84.9	57.2	86.7	96.3	84.1

These are jaw-dropping figures.

“This is the man who has stirred three hundred million people to revolt, who has shaken the foundations of the British empire, and who has introduced into human politics the strongest religious impetus of the last two thousand years.”

A study by Azim Premji University’s Centre for Sustainable Employment, titled ‘State of Working India 2018’ also came to a very similar conclusion. It found that nationally, 67% of households reported monthly earnings of up to Rs 10,000. The report goes on to say, “a large majority of Indians are not being paid what may be termed a living wage.”[24]

On the basis of World Bank’s poverty line, and Anoop Satpathy committee recommendations, and the data given above, we can definitely say that till before the pandemic, at least 67% of the population, or maybe even more than, were poor.

The pandemic and Modi Government’s apathetic and inconsiderate handling of the pandemic devastated people’s livelihoods. Another study by Azim Premji University, State of Working: India 2021, by economists Amit Basole and Rosa Abraham, found that in 2020, the number of people below the poverty line increased by 23 crore (they define the poverty line as the national floor-level minimum wage as recommended by the Anoop Satpathy committee).[25] That’s huge, nearly one-fifth the population!

This is corroborated by a recently published survey report — the ICE360 Survey 2021 — conducted by the People’s Research on India’s Consumer Economy (PRICE), a Mumbai-based think-tank. The survey, between April and October 2021, covered 200,000 households in the first round and 42,000 households in the second round. It was spread over 120 towns and 800 villages across 100 districts. The survey found that:

•  during the Modi years, over the period 2015–16 to 2020–21:

• the poorest 20% (first quintile), witnessed a huge 53% fall in their income;
• the second-lowest quintile (lower middle class), saw their income decline by 32% in the same period.[26]

As discussed at the beginning of this article, the post-pandemic years have not seen any significant economic recovery, the economy continues to flounder. We do not have reliable estimates of people’s consumption and therefore of poverty and inequality, as the Modi Government has scrapped the large consumer expenditure surveys of the NSSO. From this fact alone we can conclude that the Modi Government’s claim that the economy is doing well and poverty levels are declining, is all bluster.

Recently, two studies have come out that indicate that the majority of people in the country continue to wallow in poverty, that there has been no decline in poverty despite all the government claims of the Indian economy being among the best performing economies in the world. 

In the absence of more comprehensive survey data, economists C.P. Chandrasekhar and Jayati Ghosh base themselves on quarterly PLFS data of the NSSO, to get an idea of what is happening to wages of casual workers and incomes of those in self-employment. PLFS wage data, deflated by the Consumer Price Index for rural and urban workers, shows that real wages of casual workers in rural and urban India had started declining before the Covid-19 pandemic. As is to be expected, wages fell sharply during the pandemic. But after the pandemic, they have recovered only slightly. Quarterly average wages in April–June 2022 were only slightly above the pre-pandemic peak reached in January–March 2019. The story is worse for self-employed workers, who constitute more than half of all workers. Real remuneration from self-employment peaked in early 2019, and started falling thereafter well before any pandemic-related economic disruptions. The pandemic and the lockdowns led to sharp declines in such incomes. The subsequent economic recovery has not led to incomes reaching the earlier levels. Even in April–June 2022, self-employed workers continued to earn less than what they were earning three years earlier.[27]

Another study that also arrives at a similar conclusion is based on the Reserve Bank of India’s latest Handbook of Statistics on Indian States. This handbook presents annual wage estimates based on Labour Bureau data from 2014–15 to 2021–22. Economist Jean Dreze used this data to estimate growth of real wages using the Consumer Price Index for Agricultural Labourers. He comes up with the startling finding that during these eight years, the growth rate of real wages was below 1% per year across the board for all three groups of workers — agricultural and non-agricultural workers, and construction workers (Table 10). And if the Consumer Price Index is used as deflator, the real wage growth is lower, even negative for construction workers.

More recent wage data presented in Economic Survey 2022–23 shows that this pattern of stagnation has continued till the end of 2022.[28]

Table 10: Average Annual Growth in Real Wages, 2014–15 to 2021–22 (in %)

	Real Wage Growth
Agricultural Workers	0.9
Construction Workers	0.2
Non-Agricultural Workers	0.3

Another recent dataset presents an even more dismal picture about poverty levels in the country. Of the 28 crore unorganised sector workers registered on the e-Shram portal as of 2022, 94% reported an income of less than Rs 10,000 per month.[29] Taking the country’s total workforce to be 45 crore or so (Greater Labour Force, CMIE September–December 2022 data), of whom more than 90% or 40 crore are in the unorganised sector, the conclusion can definitely be drawn from this dataset that at least 60–70% of the country’s workforce is living below the Anoop Satpathy committee recommended poverty line!

All these various datasets point to one inescapable conclusion — that large masses of the country’s people, anywhere from 50 to 70% or even more, live in dire poverty.

Rising Suicide Rate

That the country is facing a huge unemployment and poverty crisis is also reflected in another grim statistic: rising suicides among the daily wage earners, self-employed and unemployed. According to NCRB data, not only has the number of suicides in the country been going up in absolute numbers, it is also increasing as a percentage of the population. In 2021, more than 1.6 lakh people took their lives, of whom 46% were daily wage earners, self-employed and unemployed

Table 11: Suicides in India, 2017 to 2021[30]

Year	Total Number of Suicides (1)	Rate of Suicides*	Suicides by Daily wage earners, self-employed and unemployed as % of Total Suicides
2017	1,29,887	9.9	42.1%
2018	1,34,516	10.2	41.8%
2019	1,39,123	10.4	45.1%
2020	1,53,052	11.3	46.1%
2021	1,64,033	12.0	46.3%

*Rate of suicides = Total number of suicides / Population

A quarter of the suicides in the country are of daily wage workers (25.6% in 2021, or 42,000 workers).[31] Obviously, the prime reason for their committing suicide is economic distress — a reflection of the fact that real wages in the country are so low that people are finding it difficult to make ends meet, and are committing suicide out of frustration.

Hunger and Malnutrition Emergency

Such huge poverty levels also means the country would be facing a hunger emergency. This is borne out by data from the National Family Health Survey–5 (2019–20). The survey data show that:

• 36% of children under the age of five are stunted (low height for age, indicating chronic or long-term malnutrition);
• 19% are wasted (indicating acute malnutrition); and
• 32% are underweight (low weight for age, indicating both chronic and acute malnutrition).

The survey also alarmingly found that a huge 67% of children under-5 (6–59 months) suffer from anaemia.[32]

The survey was conducted before the pandemic struck. The pandemic has led to a huge increase in unemployment, massive fall in incomes, and has pushed crores of people into poverty. Consequently, all these malnutrition indicators must have considerably worsened.

Under /mal-nutrition severely stunts intellectual, emotional and physical growth. Studies also show that the effect of malnutrition is most acute in the age group from 0 to 3 and this cannot be mitigated in one’s adult life; in other words, both body growth and brain development are permanently adversely affected.

More recent data related to the hunger crisis gripping the country are even more alarming. The latest (2022) ‘State of Food Security and Nutrition in the World (SOFI)’ report published jointly by five UN organisations presents updates of the food security and nutrition situation around the world, for the year 2021, the immediate year after the 2020 pandemic. The report’s conclusions for India are:

• The number of people suffering from moderate or severe food insecurity was 36.4 crore in 2014–16 (27.5% of the population). During the triennium 2019–21, this figure increased to 56.4 crore people (40.4% of the population). That is a huge increase, by nearly 13 percentage points.
• The proportion of the population that is severely food insecure in the country has risen by nearly 50% over this period, from 20.3 crore (15.3% of the population) in 2014–16 to 30.8 crore (22.1% of the population) in 2019–21.
• India alone accounts for more than one-third, 37% of the severely food-insecure population in the world.[33]

These findings are supported by another survey, that was conducted between December 2021 and January 2022. This survey, conducted by a group of organisations, including the Right to Food Campaign and the Centre for Equity Studies, calculated “food insecurity” based on the methodology developed by the United Nations’ Food and Agriculture Organization for the above mentioned survey. Its results say: A total of 79% of Indian households across 14 states which responded to the survey reported some form of “food insecurity” in 2021. As much as 25% of the families said that that they faced “severe food insecurity”.[34]

Therefore, it is not at all surprising that the Global Hunger Index (GHI) has ranked India at a low 107 out of 121 countries for which the ranking was done (high income countries are not ranked). The GHI is a report brought out annually by two European organisations that attempts to track and measure hunger globally as well as by country. The reason for mapping hunger is to assess the progress being made by different countries towards achieving the goal laid out by the United Nations of achieving zero hunger by 2030. India’s hunger levels have been rated as “serious” by the latest edition of the report, which ranked India lower than all neighbouring countries barring war-ravaged Afghanistan.[35]

To Conclude

From the huge mass of data given above, it can most definitely be said: at the beginning of 2023, two years after the pandemic ended, the Indian economy continued to be in crisis. It was facing a monumental unemployment and poverty crisis.

Has the Budget 2023 taken any meaningful steps to tackle this crisis? We examine this in the next article in this series.

References

1. We have discussed this in several of our writings. See for example our booklet, “Is the Government Really Poor?”, Lokayat publication, available online at https://lokayat.org.in.

2. Aunindyo Chakravarty, “GDP Not Accurate Measure of Economic Growth”, 11 March 2023, https://www.tribuneindia.com.

3. Neeraj Jain, “Modinomics = Falsonomics, Part I”, Janata Weekly, 13 April 2019, https://janataweekly.org.

4. “India’s GDP Growth Overestimated by 2.5%, Says Former CEA Arvind Subramanian”, 11 June 2019, https://www.thehindubusinessline.com.

5. Prabhat Patnaik, “The Current State of India’s Economy”, 24 April 2023, https://www.networkideas.org.

6. For more discussion on this, see: Arun Kumar, “Marginalized Indian Rural Economy: Its Challenges”, Janata Weekly, 12 March 2023, https://janataweekly.org; “Our Rate of Growth Will Fall Further”, Shobha Warrier interviews Arun Kumar, 18 August 2022, https://www.rediff.com.)

7. “Indian Economy Continues to Show Resilience Amid Global Uncertainties”, World Bank, 4 April 2023, https://www.worldbank.org; “IMF Lowers India’s GDP Growth Forecast to 5.9% for 2023-’24 from 6.1%”, 11 April 2023, https://scroll.in.

8. “Our Rate of Growth Will Fall Further”, Shobha Warrier interviews Arun Kumar, op. cit.

9. Santosh Mehrotra, Jajati K. Parida, India’s Employment Crisis: Rising Education Levels and Falling Non-Agricultural Job Growth, October 2019, CSE Working Paper, https://cse.azimpremjiuniversity.edu.in.

10. Several analysts have raised the issue of reliability of PLFS data. See for instance: Krishna Raj, Kaibalyapati Mishra, “India’s Data Deficiency and the Need for Quality Unemployment Figures”, 25 December 2022, https://www.deccanherald.com; “PLFS Data: What the Numbers Hide”, 25 August 2021, https://www.thehindubusinessline.com; Tulsi Jayakumar, “What India’s Labour Force Survey Actually Says About Employment”, 3 August 2021, https://www.livemint.com.

11. Periodic Labour Force Survey (PLFS) – Annual Report (July, 2020 – June, 2021), 14 June 2022, https://pib.gov.in.

12. Subodh Varma, “Central Government: 22 Crore Applied, 7 Lakh Got Jobs, 9 Lakh Posts Still Vacant”, 31 July 2022, https://www.newsclick.in.

13. Unemployment Rate Monthly Time Series (%): India, CMIE, https://unemploymentinindia.cmie.com, accessed on 12 April 2023.

14. Unemployment in India: A Statistical Profile, Sept–Dec 2016, 2019 and 2022, CMIE, https://unemploymentinindia.cmie.com.

15. Mahesh Vyas, “India’s Employment Rate Lower Than Pakistan, Bangladesh”, 9 February 2022, https://www.rediff.com; “Employment Rate”, OECD Data, 2022, https://data.oecd.org; “Estimated Employment-to-Population Ratio Worldwide in 2022, by Region”, https://www.statista.com.

16. See our booklet, The Unemployment Crisis: Reasons and Solutions, Lokayat publication, Pune, 2023, available online at https://lokayat.org.in.

17. “First Time In Four Decades, Consumer Spending In India Falls By 3.7%: Report”, 15 November 2019, https://www.outlookindia.com.

18. For more on this, see: Himanshu, “The Poverty Mystery”, Indian Express, 10 April 2023.

19. Ibid.

20. For more discussion on this, see: Jayati Ghosh, “Delay in Release of Official Statistics has Dire Consequences for Addressing Job Crisis”, 31 January 2019, https://indianexpress.com.

21. The WB’s poverty line is in PPP terms. There are several limitations with the PPP concept; also, the PPP value of the Indian rupee to the US dollar varies, depending upon the methodology used. We assume that PPP value of Indian rupee per US dollar is one-third of the 2018 dollar–rupee value of Rs 70. So, this means the World Bank’s poverty line for India is 2.15 x 70 /3 = Rs 50 per day. For a family of five, this works out to 50 x 30 x 5 = Rs 7,500.

22. “Expert Committee Submits its Report on Determining Methodology for Fixing National Minimum Wage”, 14 February 2019, https://pib.gov.in.

23. Vivek Kaul, “Book Excerpt: The Real Story Behind India’s Low Unemployment”, 19 April 2017, https://www.firstpost.com.

24. State of Working India 2018, p. 18, https://cse.azimpremjiuniversity.edu.in.

25. State of Working India 2021, p. 24, https://cse.azimpremjiuniversity.edu.in.

26. “Income of Poorest Fifth Plunged 53% in 5 Yrs; Those at Top Surged”, 24 January 2022, https://indianexpress.com.

27. C.P. Chandrasekhar and Jayati Ghosh, “Self-Employed Workers in India”, 4 April 2023, https://www.networkideas.org; C.P. Chandrasekhar and Jayati Ghosh, “The Covid-19 Pandemic and Wages of Casual Workers”, 8 March 2023, https://www.networkideas.org.

28. Jean Dreze, “Wages of Distress”, Indian Express, 13 April 2023.

29. “Income of 94.11% Registered Informal Workers at Rs 10,000 or Below”, 29 May 2022, https://www.business-standard.com.

30. NCRB data for various years, available online at https://ncrb.gov.in.

31. “Accidental Deaths & Suicides in India 2021”, Chapter 2, https://ncrb.gov.in.

32. Payal Seth and Palakh Jain, “What NFHS–5 Tells Us About the Status of Child Nutrition in India”, 26 November 2021, https://thewire.in.

33. T.K. Rajalakshmi, “Starved of Data: India’s Hungry People Go Missing from FAO Report”, Frontline, 24 July 2022, https://frontline.thehindu.com; The State of Food Security and Nutrition in the World 2022, https://www.fao.org.

34. “79% of Indian Households Experienced ‘Food Insecurity’ Last Year, Shows Survey”, Scroll Staff, 23 February 2022, https://scroll.in.

35. “What Is the Global Hunger Index and Why Is India Trailing?”, 15 October 2022, https://indianexpress.com.

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