India has recorded one of the world’s fastest declines in poverty over the past decade, lifting an estimated 496 million people out of poverty between 2011 and 2023. However, the gains have not eliminated income disparities, with workers in the top 10% earning around 13 times more than those in the bottom 10%, according to the World Bank’s October 2026 India Poverty and Equity Brief.
The report found that the share of India’s population living below the lower-middle-income poverty line of $4.20 a day, measured at 2021 purchasing power parity, fell from 57.7% in 2011 to 16.1% in 2023. Extreme poverty, measured using the $3-a-day threshold, declined from 27.1% to 2.6% over the same period.
Multidimensional poverty also registered a significant decline. The Oxford Poverty and Human Development Initiative’s Multidimensional Poverty Index showed a fall from 53.8% in 2005-06 to 16.4% in 2019-21. The World Bank’s own multidimensional poverty measure stood at 15.5% in 2022-23.
The World Bank attributed the progress to consumption growth, rising employment, particularly among women, and expanded social transfers, including food subsidies.
However, poverty remains unevenly distributed. In 2023, rural poverty stood at 19.3%, compared with 8.6% in urban areas, using the $4.20 threshold. States across a belt stretching from Uttar Pradesh to West Bengal accounted for approximately 57% of India’s poor population.
Employment growth has also not translated into comparable wage gains. India added around 134 million employed people between 2017 and 2023, nearly twice the increase in its working-age population. Much of this expansion came from rural women entering paid work, but real earnings remained broadly unchanged as employment growth was concentrated in relatively low-productivity activities.
Youth unemployment also rose from 14.6% to 15.9% between the first quarters of FY26 and FY27, particularly among rural young women.
The World Bank projects that poverty at the $4.20 threshold could decline further from 14.2% in 2026 to 12.1% by 2028. However, it cautioned that estimates may change with new economic and labour market data, and that inequality could be understated because wealthier households may be underrepresented in surveys.
Source: NDTV
