World Bank Report on Extreme Poverty

India has achieved progress in reducing extreme poverty over the past decade. According to the World Bank, the extreme poverty rate fell from 27.1 percent in 2011-12 to just 5.3 percent in 2022-23. This represents a remarkable shift in the lives of millions of people.

Statistics on Poverty Reduction

Between 2011-12 and 2022-23, approximately 269 million people moved out of extreme poverty. The number of individuals living in extreme poverty dropped from 344.47 million to 75.24 million. This success is particularly pronounced in states like Uttar Pradesh, Maharashtra, Bihar, West Bengal, and Madhya Pradesh, which accounted for 65 percent of the extreme poor in 2011-12.

Poverty Line Adjustments

The World Bank defines extreme poverty as living on less than 3.00 US Dollars per day, adjusted for 2021 prices. Using the earlier threshold of 2.15 US Dollars per day, the poverty rate fell from 16.2 percent in 2011 to 2.3 percent in 2022. This change reflects the economic realities and inflation adjustments over time.

Rural and Urban Poverty Trends

Both rural and urban poverty have seen declines. Rural poverty decreased from 18.4 percent to 2.8 percent. Urban poverty fell from 10.7 percent to just 1.1 percent. This narrowing of the rural-urban poverty gap indicates a more equitable distribution of economic opportunities.

Multidimensional Poverty Index

India has also progressed in reducing multidimensional poverty, which includes health, education, and living standards. The Multidimensional Poverty Index fell from 53.8 percent in 2005-06 to 15.5 percent in 2022-23. This improvement signifies a broader enhancement in quality of life beyond just income levels.

Government Initiatives

The decline in poverty is attributed to various government initiatives. Key programmes like PM Awas Yojana, PM Ujjwala Yojana, Jan Dhan Yojana, and Ayushman Bharat have played crucial roles. These initiatives have improved access to housing, clean cooking fuel, banking, and healthcare services.

Direct Benefit Transfers and Digital Inclusion

Direct Benefit Transfers have streamlined support delivery. Digital inclusion and improved rural infrastructure have empowered over 250 million people. This efficient and transparent system has been essential in lifting citizens out of poverty.

Current Economic Context

Despite the progress in poverty reduction, challenges remain. As of FY25, India’s real GDP was about 5 percent below pre-pandemic levels. External factors such as trade tensions could impact future growth. The current account deficit is expected to average around 1.2 percent of GDP over FY26-28.

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