India Lifts 171 Million People Out of Extreme Poverty in a decade: World Bank

Ira Singh
Khabar Khabaron Ki,28 April’25

India has lifted an estimated 171 million people out of extreme poverty between 2011-12 and 2022-23, marking a significant achievement in its ongoing battle against poverty, according to a new report by the World Bank.

In its latest Poverty and Equity Brief on India, the World Bank said, “Over the past decade, India has significantly reduced poverty. Extreme poverty (defined as living on less than $2.15 per day) fell sharply from 16.2 per cent in 2011-12 to just 2.3 per cent in 2022-23, lifting 171 million people above this line.”

The report highlighted that rural areas saw extreme poverty rates drop from 18.4 per cent to 2.8 per cent, while in urban areas it fell from 10.7 per cent to 1.1 per cent. This narrowed the rural-urban poverty gap from 7.7 percentage points to 1.7 points — an impressive 16 per cent annual decline.

Beyond extreme poverty, the World Bank noted that India has also made substantial progress under the Lower-Middle-Income Country (LMIC) poverty line (Rs 3.65 per day). Poverty under this measure declined from 61.8 per cent to 28.1 per cent, lifting around 378 million people out of poverty during the period. Rural poverty fell from 69 per cent to 32.5 per cent, and urban poverty dropped from 43.5 per cent to 17.2 per cent, reducing the rural-urban gap significantly.

India’s five most populous states — Uttar Pradesh, Maharashtra, Bihar, West Bengal, and Madhya Pradesh — played a key role in this progress. These states, which accounted for 65 per cent of India’s extreme poor in 2011-12, contributed to two-thirds of the nationwide poverty reduction. However, challenges persist, as these states still account for 54 per cent of India’s extreme poor as of 2022-23, and 51 per cent of the multidimensionally poor population based on 2019-21 data.

On multidimensional poverty which considers non-monetary aspects such as health, education, and living standards. India recorded a sharp decline. The country’s Multidimensional Poverty Index (MPI) showed that non-monetary poverty fell from 53.8 per cent in 2005-06 to 16.4 per cent by 2019-21.

The brief also highlighted notable improvements in employment trends. Employment growth has outpaced the working-age population since 2021-22, with rising employment rates among women. Urban unemployment fell to 6.6 per cent in the first quarter of FY24-25, the lowest rate since 2017-18.

Recent data indicated a shift in male employment from rural to urban areas for the first time since 2018-19, while rural female employment in agriculture has expanded.

However, the World Bank cautioned that challenges remain. Youth unemployment stands at 13.3 per cent, and rises sharply to 29 per cent among tertiary education graduates. Additionally, only 23 per cent of non-farm paid jobs are formal, and much of agricultural employment remains informal. Despite the rise in female employment to 31 per cent, significant gender disparities persist, with 234 million more men in paid employment compared to women.

The World Bank’s Poverty and Equity Briefs (PEBs) are released twice a year during the Spring and Annual Meetings of the World Bank Group and International Monetary Fund. They offer snapshots of poverty, inequality, and shared prosperity across over 100 developing countries and aim to keep poverty reduction at the forefront of the global development agenda.