How Much is Child Poverty Costing India?

A guest post by Puja Marwaha | CRY

stop child laborIllness, premature death, illiteracy, incomplete schooling – do these deprivations have a price tag attached? Is childhood spent in poverty and deprivation costing the country? The answer to this difficult question is, yes.

A childhood minus basic rights – especially the right to food and the right to education, actually costs the country in terms of growth potential hampered. In other words, it is not only poor children themselves who bear the brunt of deprivation, the nation does too.

Child Trafficking and LabourDenial of the right to food and ensuing malnutrition results in stunting, blindness and cognitive defects that lowers attention span and reduces the child’s capacity to learn. When compared with well-nourished peers undernourished children are less likely to enroll in school and even if they do they are more likely to perform poorly and be less economically productive in later life. A malnourished child is more likely to fall sick, may take longer to recover and has greater chances of dying. Pediatric malnutrition is responsible for 22.4% of India’s burden of diseases . With malnutrition so widespread (an estimated 47% of children in India are undernourished) it stays with children well into adulthood, resulting in an adult population with lower productivity and a resultant lesser economic growth for the country.

Denial of adequate education, similarly results in a very large workforce which has little skills or whose skills are not given adequate economic value. When compared to a farmer in developed countries, the Indian farmer is largely working as ill-paid labour on another’s field, because s/he is not educated enough to demand minimum wages, select a leader who will best represent her/his interests in government, and demand all the services due to him or her. In other words, an uneducated person is more likely to continue in the cycle of deprivation than an educated one. The effect on the country? An economy that has a large population but does not know how best to harness it in terms of a healthy and happy workforce. An indirect impact is a sharp growth in large scale conflict and unrest; two examples from India are the thousands of farmer suicides resulting from agrarian distress and the growth of armed resistance movements which costs the country millions in lives and resources.

A 1999 World Bank Report estimated that lost productivity, illness and death due to malnutrition was costing India at least US$ 10 – 28 billion or 3-9% of GDP annually. Another study done in 2003 estimated that productivity losses due to protein energy malnutrition (PEM), iodine deficiency disorder (IDD) and iron deficiency anemia (IDA) because of lack of appropriate interventions would amount to USS$ 114 billion between 2003 and 2012 . Yet another study that looked at the productivity losses incurred by forgone wage-employment resulting from child malnutrition estimated the loss to be close to USS$ 2.3 billion or Rs 103 billion annually .

Unfortunately no real effort has been made to assess the cost of child poverty in India though children account for 43% of the population. Prof. Praveen Jha, of the Centre for Economic studies and Planning, Jawaharlal Nehru University, opines that social scientists are reluctant to conduct such studies “Because of the data gaps” which tend to make them slippery. He feels that India’s ruling elite don’t see such as issue as important because their own children do not face such issues. Interestingly, these issues have not caught the imagination of the lower castes that are rising in the political hierarchy either.

As long as poverty is considered an unavoidable residue of progress and not among the primary causes of India’s economic and social hardships, such lack of seriousness from all quarters will continue percolating to the country’s policymaking. And poverty alleviation continue to be charity driven, rather than driven from holistic development imperatives.

A glaring, current example is the Right to Education Act, 2009, which leaves out children in the 0-6 and 14-18 age groups, despite India being a signatory to the United Nations’ Child Rights Convention that clearly mandates all individuals below the age of 18 as children. How can a right leave out 50% of its mandated stakeholders?

Biraj Patnaik, Principal Adviser, Office of the Commissioners of the Supreme Court, feels that, “Much of that problem lies in the fact that the dominant classes are not convinced about the rights based approach and don’t believe that investments in these (social) areas is the way forward. They feel that if similar investments are made in SEZs it will result in jobs, economic growth and wealth that will trickle down to the masses.” What is not accepted is that benefits of a fulfilled childhood trickles up as well, in the form of healthy, educated adult citizens.

Given this attitude, it is no surprising that budget allocations for the child have remained paltry. Way back in the 40s the Bhore Committee had recommended that 2-3% of GDP should be earmarked for health but typically it has remained below 1%. Similarly in the 1960s the Kothari Commission had said that 6% of GDP should go to education but it has always remained low – last year it was 4.13%. The child protection budget for a country of more than 440 million children is a mere 0.34 percent of the total Union Budget, which is perhaps why India has become a child trafficking ‘hotspot’.

The Union Budget 2009-10 also kept to this tradition: it shies away from key allocations to education, health, and child protection. Despite being plugged as citizen-friendly, scratching the surface of the budget throws up three key shortfalls:

Public expenditure on schooling falls short for the number of children entering school-going age every year – total allocations from the Central government for elementary education were raised by only 15.5 per cent to 25066.70 crores.

India’s public health system is crumbling. In a ranking of 175 countries’ public health spending in 2007-08, the World Health Organisation (WHO) ranked India a lowly 171.

In short, the actual increase in expenditure on children was just Rs 5100 crores: approximate 14% increase that hardly covers the number of children added to the population each year (see Table 1- Outlays for Child-Specific schemes as a proportion of the central budget)

What has also been seen is that actual expenditure often falls far short of the allocations that have been made because of procedural delays and slackness in implementation? More and more of us who actually witness the workings of the government systems at the communities, feel that increasing allocations in the social sector are not enough. We need to put our energies into using these funds well, to make sure children’s lives are changed for the better.

Earlier in February, director of the Aeronautical Development Agency (ADA), P.S. Subramanya, said he was confident the government would sanction by next year the Rs. 8000-12000 crores he needs to develop stealth combat aircraft it plans to build. That is almost one third of India’s education budget. Unlike Mr. Subramanya, I cannot profess any such confidence for allocations in a sector far, far more critical to India’s well being, its children’s education. For example, India is in talks with the US to buy ten C-17 transport aircraft for the Indian Air Force, estimated to be worth $5.8 billion, or 26,100 crores: almost equal to the cost of educating all of India’s 6-14 year olds.

Ignoring childhood poverty will affect the nation’s economic standing and it’s not insubstantial growth ambitions as well. Whether you are a government looking at fast tracking industrial growth, a business house hoping for better profit margins or a salaried professional working towards better lifestyle, the large numbers of Indian children living and growing up in extreme poverty and destitution can and will affect life and business. India’s growth story is not immune from the impact of its large scale poverty. It is time to push the choice towards our people, our children. We at CRY are asking for 10% of India’s GDP to be invested in children’s education and health. For longer term growth, this is the barest minimum.

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  1. We must stop this terrible abuse of children. It is a blight on India.

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