India’s extreme poverty rate fell from 27.1% in 2011-12 to 2.6% in 2023-24, according to the World Bank’s October 2026 Poverty and Equity Brief. Over the same period, the share of Indians living below the Bank’s lower-middle-income poverty line of $4.20 a day fell from 57.7% to 16.1%, meaning an estimated 496 million people moved above that threshold.
The World Bank attributed the progress to stronger consumption, rising employment—particularly among rural women—and expanded social support, including food subsidies. Yet the gains remain uneven, with about 232 million people still below the $4.20 line, youth unemployment rising, real earnings largely unchanged and significant wage disparities persisting.
Extreme Poverty Drops
The World Bank defines extreme poverty using a $3-a-day threshold in 2021 purchasing power parity (PPP), which adjusts for differences in purchasing power across countries. By this measure, India’s extreme poverty rate fell from 27.1% in 2011-12 to 2.6% in 2023-24, leaving around 35 million people below the threshold.
At the higher $4.20-a-day line, which is the relevant benchmark for lower-middle-income countries such as India, poverty declined from 57.7% to 16.1%. The World Bank described India’s reduction as one of the fastest declines in poverty globally.
Jobs And Social Support
The report attributes the decline to a combination of stronger household consumption, increased employment and social transfers. Employment grew by around 134 million between 2017 and 2023, nearly twice the increase in the working-age population, with much of the rise coming from rural women entering paid work.
Expanded social support, including food subsidies, also helped households maintain consumption. The World Bank said India had recorded improvements across both monetary and non-monetary measures of poverty.
Rural-Urban Divide
Poverty has fallen sharply in both rural and urban India, but the gap between them remains. Extreme poverty in 2023-24 stood at 3.1% in rural areas compared with 1.4% in urban areas. At the $4.20-a-day poverty line, the rural rate was 19.3%, more than twice the urban rate of 8.6%. Around 57% of India’s poor population is concentrated in a contiguous belt stretching from Uttar Pradesh to West Bengal, making productive employment in these regions particularly important for sustaining future poverty reduction.
The Jobs Challenge
The decline in poverty has coincided with a substantial expansion in employment, but the World Bank cautioned that the quality of jobs and earnings remains a concern. Real earnings have remained broadly unchanged, while employment growth has been concentrated in relatively low-productivity activities.
Youth unemployment also increased from 14.6% in the first quarter of FY2025-26 to 15.9% in the corresponding quarter of FY2026-27, with rural young women particularly affected. The findings suggest that creating more productive and better-paid employment will be crucial to sustaining the reduction in poverty.
Wage Gap Persists
The sharp reduction in poverty has not eliminated disparities in earnings. The World Bank reported that median earnings among workers in the top 10% were around 13 times those of workers in the bottom 10% in 2023. This does not mean every worker in the top 10% earns exactly 13 times as much as every worker in the bottom 10%; it is a comparison of median earnings between the two groups.
The World Bank also cautioned that household consumption surveys may not fully capture consumption among wealthier households, meaning measured inequality can understate the broader gap.
Beyond Income Poverty
Improvements have also been recorded in measures that look beyond household consumption. The Oxford Poverty and Human Development Initiative’s Multidimensional Poverty Index shows multidimensional poverty falling from 53.8% in 2005-06 to 16.4% in 2019-21.
The World Bank’s own multidimensional measure stood at 15.5% in 2022-23. These measures capture several forms of deprivation rather than income or consumption alone, indicating that the improvement has extended beyond the monetary poverty threshold.
What Comes Next
The World Bank expects poverty to decline further, although more slowly. At the $4.20-a-day threshold, its indicative projections put the poverty rate at 14.2% in 2026 and 12.1% by 2028. The Bank stressed that these are microsimulation-based projections and can change as new economic and labour-market data become available.
Meanwhile, the fact that around 232 million people remained below the $4.20 threshold in 2023-24 shows that crossing the extreme-poverty line does not necessarily mean households have achieved economic security.
The Logical Indian’s Perspective
India’s fall in extreme poverty is a significant achievement, particularly when millions of households have seen improved consumption, greater access to employment and stronger social support. But poverty reduction should not be treated as the end point. The next challenge is ensuring that people who have moved above the poverty line can stay there through stable incomes, productive employment and better opportunities for young people and women.
The remaining regional and wage disparities also underline the need for growth that reaches communities that have benefited less from the economic transition. As India celebrates this progress, what should be the next priority—better-paying jobs, stronger social protection or reducing regional inequality?
Also Read: Uttarakhand CM Dhami Confirms Helicopter Crash Near Joshimath; 6 On Board, Rescue Ops Underway
