Context:
India has made significant progress in reducing poverty, with extreme poverty measured at $2.15 per day in purchasing power parity (PPP) terms falling from 16 per cent in 2011–12 to 2.3 per cent in 2022–23, according to the World Bank. The decline lifted 171 million people above the internationally comparable poverty line.
Key Findings from the World Bank (2022–23):
- Extreme Poverty (defined at $2.15/day PPP):
- Fell from 16% in 2011–12 to 2.3% in 2022–23.
- 171 million people moved above the international extreme poverty line.
- Lower-Middle-Income Country (LMIC) Poverty Line ($3.65/day):
- Declined from 61.8% to 28.1%.
- This shift lifted around 378 million people out of poverty.
- Multidimensional Poverty Index (MPI):
- Dropped from 53.8% in 2005–06 to 15.5% in 2022–23.
- This measure excludes health and nutrition but reflects improvements in education, living standards, and services access.
Urban vs Rural Poverty Trends
- Rural Extreme Poverty: Fell from 18.4% to 2.8%.
- Urban Extreme Poverty: Declined from 10.7% to 1.1%.
- Rural-Urban Poverty Gap: Narrowed from 7.7 percentage points to 1.7, indicating better rural inclusion.
- At the LMIC line:
- Rural Poverty: Dropped from 69% to 32.5%.
- Urban Poverty: Declined from 43.5% to 17.2%.
- Rural-Urban Gap: Reduced from 25 to 15 percentage points, an annual decline of 7%.
Methodological Caveats:
- Estimates are based on the 2011–12 Consumption Expenditure Survey (CES) and the 2022–23 Household CES.
- The World Bank acknowledged changes in survey design (questionnaire, sampling, methodology) which may impact comparability over time.
- Concerns Raised:
- N.C. Saxena, former Planning Commission Secretary, emphasized the need for cross-verification using independent sources like the Census and NFHS.
- The new methodology might underestimate consumption inequality, which could affect real poverty estimates.
India’s rapid decline in both monetary and non-monetary poverty is noteworthy, especially at a time when global poverty reduction is slowing. However, experts stress the importance of robust data collection and transparency to ensure accurate policy direction.
