According to a new World Bank report, India has made significant progress in reducing poverty on economic and non-economic parameters in the last decade.
The report says that India has been among the countries with the fastest rate of poverty reduction in the world.
"Between 2011 and 2023, the proportion of the population living below the poverty line ($4.2 per day) for lower-middle income countries declined from 57.7 percent to 16.1 percent," the World Bank said in its 'India's Poverty and Equality' report on Friday.
According to the report, "An estimated 496 million people came out of poverty during this period. At the same time, the proportion of the population living in extreme poverty ($3 per day) decreased from 27.1 percent to 2.6 percent."
The World Bank said that the trend of poverty reduction is expected to continue. Although its speed may be slow. Based on the poverty line of $4.20 per day, the poverty rate is expected to decline from 14.2 percent in 2026 to 12.1 percent by 2028.
The World Bank said, "Poverty on non-economic parameters is assessed based on the Multidimensional Poverty Index (MPI) of the Oxford Poverty and Human Development Initiative (OPHI). According to this, the poverty rate was 53.8 percent in 2005-06, which decreased to 16.4 percent in 2019-21. World Bank According to the Multidimensional Poverty Index, this rate was 15.5 percent in 2022-23."
Poverty is decreasing in India but the question of increasing economic inequality still remains. Speaking at an India Today event with senior journalist Rajdeep Sardesai, economist Santosh Mehrotra said, "The reality is that when you measure inequality on the basis of consumption, it always shows very low levels of inequality. "Income inequality is much greater than this."
He said, “In India we do not do income survey at all. Inequality is a very serious problem in our country, which has become worse. We should not ignore this thing.
Finance Minister welcomed the findings of the report
Finance Minister Nirmala Sitharaman welcomed the report's findings and highlighted the positive aspects revealed by the data in a post on social media.
"The World Bank has identified strong consumption growth, increased employment, especially among women, and the expansion of social assistance schemes, including food subsidies, as key drivers of poverty reduction," Sitharaman said.
He further said, "The sustained policy efforts of the government under the leadership of Honorable Prime Minister Narendra Modi are yielding concrete results. This is strengthening the foundation for inclusive growth and expansion of economic opportunities."
wage inequality
The World Bank report says that as poverty has declined, it has now become more concentrated among households with low levels of education, low assets, limited access to permanent employment and a high number of dependents.
"However, wage inequality is still high. In 2023, the average wage of the top 10 percent of workers was nearly 13 times that of the lowest-earning 10 percent," the report said.
The report said, "Poverty is also linked to specific geographical areas. Living standards have improved in most states, but households in a contiguous region stretching from Uttar Pradesh to West Bengal contain about 57 percent of the country's total poor population."
unemployment among youth
The report also says that between 2017 and 2023, employment increased by about 13.4 crore people. This was almost double the increase in the working-age population. A large part of this increase in employment came from rural women joining paid work, which increased the number of earning members in families.
However, the World Bank highlighted that "the unemployment rate among youth increased from 14.6 percent to 15.9 percent between the two quarters (Q1 FY 2026-27 and Q1 FY 2027-28). This particularly impacted rural young women."
"Furthermore, real wages remained largely unchanged, while employment growth occurred primarily in relatively low-productivity activities," the report said.
