Full Form of BPL – Below Poverty Line
Full Form of BPL is Below Poverty Line. Below Poverty Line is a benchmark used by the Indian government to determine the population with lower means, requiring assistance from the government to survive, generally determined by the minimum daily wages one should earn to be qualified to live below the poverty line.
- The working group of the planning commission, 1962, recommended a minimum level of expenditure required to make a living as Rs. 20 per person in rural areas and Rs. 25 per person in urban areas excluding health and education, because those were provided by states. The criterion was further refined after that in the 1970s when the below the BPL threshold was defined as the per capita consumption based on the number of calories required to survive in rural and urban areas. Under this definition the minimum calorie requirement for rural and urban areas was stipulated at 2400 and 2100 per day, requiring a daily income of Rs. 49.1 and Rs. 56.7, respectively.
- In 1993, and the expert group broke the aggregate poverty line definition to state-level definition, wherein the poverty line for each state was determined separately. The poverty line for states was updated taking into account the CPI-Agricultural Labor and CPI-Industrial Workers for rural and urban areas, respectively. The aggregated poverty lines for states were aggregated into the all India poverty ratio.
- In 2012, the poverty line threshold reached Rs. 972 in rural India and Rs. 1,407 in urban India. In that year, 29.5% of the Indian population was estimated to be living below the poverty line. In 2014, the Rangarajan committee said that around 454 million people in the country forming 38% of the population was living below the poverty line.
What are the Parameters that Define BPL?
World bank defines the below poverty line income threshold to be $1.25 per day. However, India used a sustenance food standard to define the poverty line before changing it to spending per individual over a certain period for a basket of essential goods and services. This basket of goods included food, conveyance, clothing, rents, fuel, electricity, and education.
Benefits of BPL Card
- The government issues BPL cards to families living below the poverty line for appropriate identification and provision of monetary and non-monetary benefits to these families for their support and upliftment.
- The government helps this section of the society through reservations in educational institutes and government jobs, special grants and scholarships. It also undertakes various income generation programs to provide entrepreneurial skills through financial institutions.
- There are a number of other programs like Sarva Shiksha Abhiyan (SSA), the National Rural Health Mission, National Rural Employment Guarantee (NREGA), Rashtriya Swasthya Bima Yojana (RSBY). Sarva Shiksha Abhiyaan brings education to children belonging to the poor families, National Health Rural Mission provides healthcare access to below poverty line population and National Rural Employment Guarantee provides 100 days of guaranteed employment to economically weaker sections of the society. RSBY provides health insurance coverage to the below poverty line population. The government also provides food items at subsidized rates to BPL families.
Differences between BPL and APL
The government defines BPL families like the ones who earn less than Rs. 15,000 in household income, while Above Poverty Line (APL) are families earning more than Rs. 15,000 but less than Rs. 1 Lakh in household income. This is one, but major, of many more criteria for eligibility to get a BPL or APL card. APL cardholders get subsidized food grains and fuel on the basis of availability and at a higher rate than BPL cardholders, who get food grains and fuel on a priority basis and at lower rates.
What is the Benefit of the BPL Ration Card?
The criterion to decide the eligibility of the BPL ration card has been set at families having annual income up to Rs. 15,000 having been included in the IRDP List of 1997-98. The cardholders are eligible to get 25-35 kilograms for food grains at subsidized rates.
#1 – Medical Relief
BPL cardholders also get medical assistance at the central government-owned super specialty hospital for critical illness under its Rashtriya Arogya Nidhi (RAN) initiative. The coverage under the plan was Rs. 2 Lakhs per BPL card and was later increased to Rs. 5 lakhs.
#2 – Education
The BPL card benefits are extended significantly to students from poor backgrounds. These benefits include reservation for admission in private schools at reduced fees, scholarships, skill enhancement programs, reservations in renowned universities and colleges and financial assistance for higher studies and vocational studies.
The benefits in education vary from state to state and institution to institution. Due to a lack of awareness amongst the people in extreme poverty these benefits do not always go to the needy.
#3 – Bank Loan
India has gone on a financial inclusion drive to bring almost everybody in the country under the banking net to formalize the economy and direct transfer of benefits to plug the leaks. To help the families under BPL, the government has also initiated loan schemes like Swarna Jayanthi Shahri Rozgar Yojana (SJSRY) and Swarna Jayanti Gram Swarozgar Yojana (SJGSY).
Under SJSRY, a loan up to Rs. 50,000 can be taken by urban BPL cardholders to set-up self-employment opportunities. A subsidy of 15% is provided subjected to maximum limits. SJGSY provides loans for self-employment opportunities in rural India. Applicants can get a loan of up to Rs. 50,000 individually and up to Rs. 6.25 lakhs in a group. There is a margin requirement of 20% for loans above Rs. 50,000. A subsidy of 30% of project cost (maximum Rs. 7,500 for general and Rs. 10,000 for SC/ST) is provided for individuals and 50% is provided to groups subjected to a maximum of Rs. 1.25 lakhs.
India on home to most poor people in the world. By new standards approximately 38% of the country is poor. The official definitions fail to incorporate many aspects of the cost of living which makes lives even costlier in the country. The alarming situation calls for huge government support in all the aspects of poor people’s lives including food, health, and education. While the government is doing quite a bit, it leaves more desirable when it comes to eradication poverty in the country.
This has been a guide to the Full Form of BPL (Below Poverty Line) and its definition. Here we discuss the parameters and benefits of the BPL ration card along with its differences. You may refer to the following articles to learn more about finance –