India's Extreme Poverty Drops From 27.1% To 2.6% In 12 Years: World Bank

India lifted an estimated 496 million people out of poverty between 2011 and 2023, with the share of the population living in extreme poverty declining sharply from 27.1 per cent to 2.6 per cent, according to the World Bank's October 2026 Poverty and Equity Brief.

The report said the proportion of people living below the lower-middle-income poverty line of USD 4.20 per day, measured at 2021 purchasing power parity (PPP), also fell from 57.7 per cent to 16.1 per cent during the period.

Describing the progress as "one of the fastest poverty declines in the world", the World Bank said India had recorded improvements across both monetary and non-monetary measures of poverty.

The report attributed the decline mainly to strong consumption growth, rising employment, particularly among women, and expanded social transfers, including food subsidies.

Poverty is expected to decline further, although at a slower pace. The World Bank's projections indicate that the poverty rate at the USD 4.20-a-day threshold could fall from 14.2 per cent in 2026 to 12.1 per cent by 2028.

It cautioned that these are indicative estimates based on microsimulations and could change as new labour market and macroeconomic data become available.

Non-monetary poverty has also declined significantly. The report said the poverty rate measured through the Oxford Poverty and Human Development Initiative's Multidimensional Poverty Index fell from 53.8 per cent in 2005-06 to 16.4 per cent in 2019-21. The World Bank's own multidimensional poverty measure stood at 15.5 per cent in 2022-23.

However, the report highlighted continuing regional and employment-related challenges. Around 57 per cent of India's poor population is concentrated in a contiguous belt stretching from Uttar Pradesh to West Bengal, making productive employment opportunities in these states important for further poverty reduction.

Employment increased by around 134 million people between 2017 and 2023, nearly twice the growth in the working-age population. Much of this increase came from rural women entering paid employment.

However, youth unemployment rose from 14.6 per cent to 15.9 per cent between the first quarters of FY26 and FY27, particularly among rural young women. Real earnings also remained broadly unchanged, with employment growth concentrated in relatively low-productivity activities.

The report noted that poverty estimates are based on household consumption surveys and cautioned that some recent gains may reflect improvements in measurement alongside genuine welfare improvements.

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