India Poverty and Equity Brief

World Bank has released the ‘India Poverty and Equity Brief’ which said that India has achieved significant progress in poverty reduction and employment growth.

Key Highlights

Significant Poverty Reduction:

• Extreme poverty (living on <$2.15/day) fell to 2.3% of the population in 2022–23, down from 16.2% in 2011–12.
• 17.1 crore people lifted out of extreme poverty during this period.

Rural-Urban Breakdown:

• Rural extreme poverty: Dropped from 18.4% to 2.8%.
• Urban extreme poverty: Dropped from 10.7% to 1.1%.
• Rural-Urban Gap: Narrowed significantly from 7.7 to 1.7 percentage points, a 16% annual decline.

Income Category Transition:

• India transitioned into the Lower-Middle-Income Country (LMIC) category.
• Using the $3.65/day LMIC poverty line:
  • Overall poverty reduced to 28.1% from 61.8%.
  • 37.8 crore people lifted out of poverty.

Further Rural-Urban LMIC Data:

• Rural poverty: Declined from 69% to 32.5%.
• Urban poverty: Declined from 43.5% to 17.2%.
• Rural-Urban Gap: Reduced from 25 to 15 percentage points, showing a 7% annual decline.

State-wise Contributions:

• Five largest states — Uttar Pradesh, Maharashtra, Bihar, West Bengal, and Madhya Pradesh:
  • Accounted for 65% of extreme poor in 2011–12.
  • Contributed to two-thirds of poverty reduction by 2022–23.
  • Still account for:
    • 54% of India’s extremely poor (2022–23).
    • 51% of India’s multi-dimensionally poor (2019–21).

Inequality Trends:

• Gini Index (consumption-based measure of inequality) improved:
  • From 28.8 (2011–12) to 25.5 (2022–23).
• Note: Actual inequality might be underestimated due to data limitations.
• (Gini Index: 0 = perfect equality, 1 = perfect inequality.)

(Source: BL)