In short :
India’s Extreme Poverty Fell to 5.3% in 2022–23
- From 27.1% (2011–12) → 5.3% (2022–23) using revised threshold of $3/day (2021 PPP).
- Indicates faster poverty reduction than in previous decades.
- India shows strong resilience in poverty reduction post-pandemic.
- Based on updated international poverty lines adjusted for inflation and global cost of living.
Revised Global Poverty Threshold :
- Old threshold: $2.15/day → New: $3/day (2021 PPP).
- Result: better reflects real poverty levels across developing nations.
- India’s figures:
- Extreme poverty fell from 27.1% (2011-12) to 5.3% (2022-23).
- In numbers: 344 million → 75 million extremely poor people.
- Progress: In 2011–12, 27 in 100 were poor → Now, only 5 in 100.
| What is the Poverty Line?A threshold to measure poverty based on income/consumption. Types:Absolute Poverty: Based on fixed basket of essentials.Relative Poverty: In relation to average income/consumption. Set by: World Bank (IPL) using PPP. Individual countries using local metrics (e.g., calorie norms in India). |
LMIC — Low and Middle Income Countries
Note: $4.20/day is effectively lower than inflation-adjusted $4.40/day, aiding lower poverty estimates.
Rural vs Urban Poverty
- Rural: 69% → 32.5%
- Urban: 43.5% → 17.2%
- Still higher poverty in rural areas, but sharp decline in both.
Rising Consumption
- Rural MPCE (Monthly Per Capita Consumption Expenditure): ₹1,430 → ₹2,079 (at 2011-12 prices)
- Urban MPCE: ₹2,630 → ₹3,632
Multidimensional Poverty Index (MPI)
- World Bank MPI: 53.8% (2005-06) → 15.5% (2022-23)
- NITI Aayog MPI: 29.17% (2013-14) → 11.28% (2022-23)
- Indicators: Education, income, enrolment, water, sanitation, electricity
Purchasing Power Parities (PPPs)
- Currency conversion rates used for international comparisons.
- Reflect real cost of living differences.
- Computed by International Comparison Program (ICP) under UNSC, managed by the World Bank.
Conclusion
- India’s poverty has sharply declined despite revised global benchmarks.
- Data shows inclusive growth and improved living standards
- Next full poverty report: Expected Oct 2025 via World Bank’s Poverty & Inequality Platform (PIP).
Initiatives that led to decline in poverty:
- PM Awas Yojana: By providing a pucca house, with basic amenities, to all houseless households
- PM Ujjwala Yojana: By making clean cooking fuel such as LPG available to the rural and deprived households
- PM Jan Dhan Yojana: By ensuring access to financial services to every Indian
- Ayushman Bharat: By reducing the financial burden on poor and vulnerable groups arising out of catastrophic hospital episodes and ensuring their access to quality health services.
UPSC Relevance :
GS2 – Welfare Schemes & Social Justice
Tracking the outcomes of poverty alleviation programs, socio-economic development, and equity in access to basic services.
GS3 – Inclusive Growth & Development
Empirical assessment of poverty reduction, consumption trends, and multidimensional deprivation; role of public expenditure and social safety nets.
GS1 – Indian Society & Demographics
Changing rural-urban dynamics, disparities in education and regional development, and indicators of human development.
Possible Mains Question
“India has made significant strides in reducing both monetary and multidimensional poverty, yet challenges in equitable growth persist.” Discuss with reference to the latest World Bank data. (250 words)
