Wealth Index of India - Highlights

Recently ministry of health and family welfare released Wealth index of India. Apart from wealth index the survey also reveals that poverty as a largely rural phenomenon.

How the survey is conducted:

  • The index is based on data from the fourth round of the National Family and Health Survey (NFHS-4). The survey was conducted among more than 6 lakh households in 2015-16. 
  • The index has been prepared based on scores on ownership of consumer goods such as television and bicycles, and household characteristics such as availability basic facilities of clean drinking water. It then uses this information to classify all households into five wealth quintiles


Main Outcomes of the survey:

Two main outcomes of the survey are:
  • Wealth Index 
  • Poverty levels in India 

Wealth Index:

Richest states in India are
  • Delhi 
  • Punjab 
  • Goa 
Among major states, people in Delhi and Punjab are the richest with more than 60% of their households in the top wealth quintile. Goa follows next with 54.5% households in the top bracket
Bihar is the poorest state in India with more than half of the households in the bottom wealth quintile.
Rajasthan has more equitable wealth distribution compared to other states with similar number of households in all quintiles. 

Among various communities in India:
  • Jains are the wealthiest community in India 
  • In terms of wealth, Sikh community stands in second place 
  • There isn’t much difference between Hindus and Muslims in terms of wealth. Hindus and Muslims have similar (also the most equitable) wealth distribution across all quintiles. 

Poverty levels in India as per NFHS-4:

Based on the information from National Family and Health Survey (NFHS-4) all households are classified into wealth quintiles.
  • Those in the lowest quintile would the poorest 20%, 
  • While those in the top would be the richest 20% of the lot. 
29% of rural India belongs to the bottom quintile, while the figure is just 3.3% for urban India. This means that 29% of the rural population has wealth levels equivalent to bottom 20% of the country’s population.
  • The report shows that poverty is predominantly a rural phenomenon in India. 
  • Upper castes have almost double the families in the top quintile as compared to any other caste. 
  • Scheduled tribes, with 45.9% of their people in the lowest quintile, are the poorest. 

Model Questions:

1. Which of the following ministry releases Wealth index in India? 
a. Ministry of Human resources
b. Finance ministry
c. Ministry of Health & Family welfare
d. Ministry of home affairs 

2. Which of the following community is wealthiest in India? 
a. Hindus
b. Jains
c. Muslims
d. Sikhs 

3. Which among the following is the poorest state in India? 
a. Assam
b. Orissa
c. Bihar
d. Telangana 

4. As per NFHS-4, how much % of scheduled tribes are poorest? 
a. 45.9% 
b.50.1%
c.33%
d. 46.5%

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