{"id":95801,"date":"2026-03-31T16:07:22","date_gmt":"2026-03-31T10:37:22","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=95801"},"modified":"2026-03-31T16:07:22","modified_gmt":"2026-03-31T10:37:22","slug":"rangarajan-committee","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/rangarajan-committee\/","title":{"rendered":"Rangarajan Committee, Objectives, Highlights, Methodology"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">The Rangarajan Committee played an important role in shaping India\u2019s economic and financial policies. It was formed to study key issues like poverty estimation, fiscal management, and the petroleum sector. The committee provided practical recommendations that helped the government improve policy decisions and economic planning.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The committee is named after C. Rangarajan, a well-known economist and former Governor of the <strong><a href=\"https:\/\/vajiramandravi.com\/upsc-exam\/reserve-bank-of-india\/\" target=\"_blank\">Reserve Bank of India<\/a><\/strong>.<\/span><\/p>\n<h2><b>Rangarajan Committee Objectives<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The main objective of the committee was to review existing systems and suggest better policies for economic growth.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">To create a broader poverty metric covering basic human needs.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">To include costs of food, health, education, clothing, and shelter.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">To move beyond the old calorie-based poverty estimation system.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">To reflect real living conditions and cost of living in India.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">To help the government design better welfare policies.<\/span><\/li>\n<\/ul>\n<h2><b>Key Highlights of the Rangarajan Committee Report<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The Rangarajan Committee made several important observations and improvements over earlier poverty estimation methods:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Earlier, the Tendulkar Committee used a single urban poverty basket to estimate poverty for both rural and urban areas. The Rangarajan Committee returned to the older approach of having <\/span><b>separate poverty baskets for rural and urban areas<\/b><span style=\"font-weight: 400;\">, making the estimates more realistic.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">While the Tendulkar Committee moved away from calorie norms, the Rangarajan Committee reintroduced <\/span><b>nutritional standards<\/b><span style=\"font-weight: 400;\"> by considering calories, proteins, and fats together. It emphasized that nutrition should still be an important part of poverty estimation.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The committee preferred <\/span><b>National Sample Survey Office (NSSO)<\/b><span style=\"font-weight: 400;\"> consumption data over National Accounts Statistics (NAS), as NSSO data better reflects household-level consumption patterns.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">It supported improved methods for adjusting <\/span><b>price differences across states and over time<\/b><span style=\"font-weight: 400;\">, ensuring more accurate poverty estimates.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The committee noted that government spending on services like education and health is not fully captured in consumption surveys, which may lead to underestimation of actual living standards.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">It rejected the use of non-consumption indicators (like assets or income) as the main basis for poverty measurement, stating that such methods are difficult to measure accurately. However, it also explored an alternative idea of identifying poverty based on a household\u2019s ability to save.<\/span><\/li>\n<\/ul>\n<h2><b>Methodology Recommended by Rangarajan Committee<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The committee proposed a detailed and scientific method to estimate poverty, based on both nutritional needs and essential non-food expenses.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The committee suggested that the poverty line should be based on a <\/span><b>comprehensive consumption basket<\/b><span style=\"font-weight: 400;\">, including both food and essential non-food items like clothing, housing, education, and transport.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">It adopted <\/span><b>Monthly Per Capita Expenditure (MPCE)<\/b><span style=\"font-weight: 400;\"> as the main basis for measuring poverty, focusing on how much a person spends to meet basic needs.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Nutritional requirements were included using standards given by the Indian Council of Medical Research, covering calories, proteins, and fats rather than just calorie intake.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">It estimated average daily energy requirements as:<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">2,155 kcal per person in rural areas<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">2,090 kcal per person in urban areas<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The committee allowed a <\/span><b>\u00b110% variation range<\/b><span style=\"font-weight: 400;\"> in calorie intake to account for differences in lifestyle and health conditions.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">A <\/span><b>food basket<\/b><span style=\"font-weight: 400;\"> was designed that satisfies all nutritional norms (calories, protein, and fat), ensuring adequate nourishment.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">For non-food expenses, it used <\/span><b>median expenditure levels<\/b><span style=\"font-weight: 400;\"> for basic needs such as clothing, rent, education, and transport.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Additional non-food expenses were included based on actual spending patterns of households that meet nutritional requirements.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The committee used <\/span><b>Modified Mixed Reference Period (MMRP)<\/b><span style=\"font-weight: 400;\"> data from NSSO surveys for more accurate consumption estimates.<\/span><\/li>\n<\/ul>\n<p>Also Check: <strong><a href=\"https:\/\/vajiramandravi.com\/current-affairs\/kelkar-committee\/\" target=\"_blank\">Kelkar Committee<\/a><\/strong><\/p>\n<h2><b>Poverty Line Defined by Rangarajan Committee<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The Rangarajan Committee introduced a new poverty line based on Monthly Per Capita Expenditure (MPCE). This means the minimum amount a person needs to spend per month to meet basic needs.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Unlike earlier methods, this approach considered real expenses faced by individuals in daily life.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Rural poverty line: \u20b9972 per person per month<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Urban poverty line: \u20b91,407 per person per month<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Equivalent daily expenditure:<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">\u20b932 per day in rural areas<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">\u20b947 per day in urban areas<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Based on 2011-12 price levels<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">This method helped in better understanding the actual cost of living and identifying poor households more accurately.<\/span><\/p>\n<h2><b>Key Changes Over Tendulkar Committee<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">The Rangarajan Committee made several important improvements over the earlier Tendulkar Committee, which had already moved away from strict calorie norms but still had limitations.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Expanded the consumption basket to include more essential services.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Included expenses on education, healthcare, rent, and transport.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Adopted a more detailed and realistic cost-of-living approach.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Used improved data collection methods like MMRP.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Provided separate and more accurate estimates for rural and urban areas.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Addressed criticisms of underestimation of poverty in earlier methods.<\/span><\/li>\n<\/ul>\n<h2><b>Rangarajan Committee Criticism<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Although the committee made improvements, it also faced criticism from experts and policymakers.<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The poverty line was still considered too low by many economists.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">It was argued that the estimates did not fully capture urban poverty challenges.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Some believed that even higher standards should be used for a dignified life.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Implementation of its recommendations in policymaking was limited.<\/span><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Rangarajan Committee refined India\u2019s poverty measure, including nutrition, non-food expenses, and separate rural-urban lines for accurate cost-of-living assessment.<\/p>\n","protected":false},"author":27,"featured_media":95665,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[786],"tags":[5267,6494],"class_list":{"0":"post-95801","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-general-studies","8":"tag-indian-economy","9":"tag-rangarajan-committee","10":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/95801","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/27"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=95801"}],"version-history":[{"count":4,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/95801\/revisions"}],"predecessor-version":[{"id":95817,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/95801\/revisions\/95817"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/95665"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=95801"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=95801"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=95801"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}