5.26 ndian onom
recommended moving away from anchoring the the GDP. Similarly, the revenue deficit of the
poverty lines to the calorie intake norm, adopting Centre increased from 1.1 per cent in 2007–08
the Mixed Reference Period (MRP) based to 4.5 per cent in 2008–09 and further to 5.2 per
estimates of consumption expenditure as the basis cent in 2009–10 and declined to 3.4 per cent for
for future poverty lines, adopting MRP equivalent 2010–11 (RE). As per 2011–12 (BE), the revenue
of urban Poverty Line Basket (PLB) corresponding deficit is projected at the same level of 3.4 per cent
to 25.7 per cent urban headcount ratio as the new of the GDP. The increase in the deficit levels of
reference PLB for rural areas. On the basis of the the Centre owes to revenue foregone on account
above methodology, the all-India rural poverty of reduction in indirect tax rates and enhanced
headcount ratio for 2004–05 was estimated at public expenditure in order to boost demand in
41.8 per cent, urban poverty headcount ratio at the economy amidst global meltdown.
25.7 per cent and all India level at 37.2 per cent. The issue of Price Stability remained
It may however be mentioned that the Tendulkar resonating for more than half of the Plan
Committee’s estimates are not strictly comparable period. To ward off the crisis of rising prices,
to the present official poverty estimates because of the government needed to announce several tax
different methodologies. As has been indicated in concessions at one hand, while it could not pass
the Mid-Term Appraisal of the Eleventh Five Year the burden of the costlier imported oil prices on
Plan, the revised poverty lines and poverty ratios the masses. That would have resulted in ultimately
for 2004–05 as recommended by the Tendulkar putting the exchequer in a fund-crunch mode,
Committee have been accepted by the Planning at the end, creating a short-supply of investible
Commission. The Tendulkar Committee has funds in government’s hand, hence, causing the
specifically pointed out that the upward revision Eleventh Plan to perform at the levels below its
in the percentage of rural poverty in 2004–05, target.
resulting from the application of a new rural
poverty line, should not be interpreted as implying Twelfth Plan
that the extent of poverty has increased over time. The ‘Draft Approach Paper’ of the Twelfth
These estimates, as reported by the Committee, Plan (2012–17) was prepared by the Planning
clearly show that whether we use the old method Commission after widest consultation till date—
or the new, the percentage of the population recognising the fact that citizens are now better
below poverty line has declined by about the same informed and also keen to engage. Over 950
magnitude. civil society organisations across the country
The performance on the Fiscal Scenario, provided inputs; business associations, including
according to the Planning Commission, the those representing small enterprises have been
expansionary fiscal measures taken by the consulted; modern electronic and ‘social media’
government in order to counter the effects of the (Google Hangout) were used to enable citizens
global slowdown were continued in 2009–10, to give suggestions. All state governments, as
and this led to further increase in the key deficit well as local representative institutions and
indicators. The fiscal deficit of the Centre, which unions, have been consulted through five regional
was 2.5 per cent in 2007–08 increased substantially consultations. Though the Approach Paper for the
to 6.0 per cent in 2008–09 and further to 6.4 per Plan was approved by the NDC by mid-2011, the
cent in 2009–10, but it declined to 5.1 per cent Plan Document was finalised much later after the
in 2010–11 (RE) and the Budget Estimates for launch of the plan (like the Tenth and Eleventh
2011–12 put the fiscal deficit at 4.6 per cent of Plans).