{"id":42195,"date":"2025-04-28T19:39:48","date_gmt":"2025-04-28T14:09:48","guid":{"rendered":"https:\/\/www.nextias.com\/ca\/?p=42195"},"modified":"2025-04-28T21:00:42","modified_gmt":"2025-04-28T15:30:42","slug":"india-poverty-decline-world-bank-analysis","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/editorial-analysis\/28-04-2025\/india-poverty-decline-world-bank-analysis","title":{"rendered":"India\u2019s Poverty Decline: A World Bank Analysis"},"content":{"rendered":"\n<p><strong>Syllabus: GS1\/Poverty &amp; Developmental Issues; GS3\/Economy<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Context<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Recently, the <strong>World Bank\u2019s<\/strong> released <a href=\"https:\/\/www.nextias.com\/ca\/current-affairs\/26-04-2025\/world-bank-india-poverty-drop\"><strong>Poverty and Equity Brief on India<\/strong><\/a> offers a complex picture of the socio-economic landscape of India, and raises questions about <strong>broader economic inequality<\/strong> and the <strong>reliability of data<\/strong> in capturing socio-economic trends.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Key Findings of <\/strong><a href=\"https:\/\/www.nextias.com\/ca\/current-affairs\/26-04-2025\/world-bank-india-poverty-drop\"><strong><u>Poverty and Equity Brief on India<\/u><\/strong><\/a><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Decline in Extreme Poverty:<\/strong> Extreme poverty, defined as living on less than $2.15 per day (2017 PPP terms), fell from 16.2% in 2011-12 to 2.3% in 2022-23, lifting 171 million people out of poverty.\n<ul class=\"wp-block-list\">\n<li>Rural extreme poverty dropped from 18.4% to 2.8%, and urban extreme poverty from 10.7% to 1.1%, narrowing the rural-urban gap.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-full is-resized\"><img data-dominant-color=\"dcd6c9\" data-has-transparency=\"false\" loading=\"lazy\" decoding=\"async\" width=\"598\" height=\"480\" src=\"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2025\/04\/measuring-standards.png\" alt=\"\" class=\"not-transparent wp-image-42197\" style=\"--dominant-color: #dcd6c9; width:378px;height:auto\" srcset=\"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2025\/04\/measuring-standards.png 598w, https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2025\/04\/measuring-standards-300x241.png 300w\" sizes=\"auto, (max-width: 598px) 100vw, 598px\" \/><\/figure>\n<\/div>\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Lower-Middle-Income Poverty Line: <\/strong>The World Bank introduces a broader measure of <strong>poverty at $3.65 a day (PPP terms),<\/strong> reflecting the challenges faced by low and middle-income countries.\n<ul class=\"wp-block-list\">\n<li>Using it, poverty fell from 61.8% to 28.1%, lifting 378 million people out of poverty.<\/li>\n\n\n\n<li>Rural poverty declined from 69% to 32.5%, and urban poverty from 43.5% to 17.2%, further<strong> reducing the rural-urban gap.<\/strong><\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Regional Contributions:<\/strong> Five populous Indian states \u2014 Uttar Pradesh, Maharashtra, Bihar, West Bengal, and Madhya Pradesh \u2014 accounted for 65% of the country&#8217;s extreme poor in 2011-12 and contributed to two-thirds of the overall decline by 2022-23.<\/li>\n\n\n\n<li><strong>Inequality Trends:<\/strong> The consumption-based <strong>Gini index<\/strong> improved from 28.8 in 2011-12 to 25.5 in 2022-23, indicating reduced inequality.\n<ul class=\"wp-block-list\">\n<li>However, income-based inequality remains high, with the median earnings of the top 10% being 13 times higher than the bottom 10%.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-full\"><img data-dominant-color=\"dcdcdc\" data-has-transparency=\"false\" style=\"--dominant-color: #dcdcdc;\" loading=\"lazy\" decoding=\"async\" width=\"212\" height=\"213\" src=\"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2025\/04\/gini-index.png\" alt=\"gini index\" class=\"not-transparent wp-image-42196\" srcset=\"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2025\/04\/gini-index.png 212w, https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2025\/04\/gini-index-150x150.png 150w\" sizes=\"auto, (max-width: 212px) 100vw, 212px\" \/><\/figure>\n<\/div>\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Employment Growth:<\/strong> It has outpaced the working-age population since 2021-22, with rising employment rates among women.\n<ul class=\"wp-block-list\">\n<li>Urban unemployment fell to 6.6% in Q1 FY24\/25, the lowest since 2017-18.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Challenges Highlighted By World Bank<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Income &amp; Gender Disparities:<\/strong> The median earnings of the top 10% were 13 times higher than those of the bottom 10% in 2023-24, reflecting persistent income inequality.\n<ul class=\"wp-block-list\">\n<li><strong>Gender disparities<\/strong> also persist, with 234 million more men in paid work compared to women.<\/li>\n\n\n\n<li><strong>Youth unemployment<\/strong> remains high at 13.3%, increasing to 29% among tertiary education graduates.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Urban-Rural Divide:<\/strong> While the urban-rural gap has narrowed from 84% in 2011-12 to 70% in 2023-24, disparities in access to opportunities and resources remain significant.<\/li>\n\n\n\n<li><strong>Conflicting Observations on Migration Trends (Data Inconsistencies):<\/strong> The brief notes a recent shift of male workers from rural to urban areas since 2018-19, which contradicts <strong>Periodic Labour Force Survey (PLFS)<\/strong> data showing an increase in agricultural employment.\n<ul class=\"wp-block-list\">\n<li>A 2024 study by the <strong>Economic Advisory Council<\/strong> to the Prime Minister reported a decline in rural-to-urban migration, creating data inconsistencies that require closer examination.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Key Factors Behind the Decline in Extreme Poverty<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Impact of Household Consumer Expenditure Surveys (HCESs) Methodology:<\/strong> The decline is captured through the revised methodology of the HCESs of 2022-23 and 2023-24, allowing a more granular understanding of consumption patterns.\n<ul class=\"wp-block-list\">\n<li>While extreme poverty is fading, the data reveals that <strong>many individuals still struggle with basic living costs.<\/strong><\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Food Security Schemes:<\/strong> The distribution of food grains to 80 crore people has played a pivotal role in reducing extreme poverty.\n<ul class=\"wp-block-list\">\n<li>These measures have ensured basic survival needs for millions, contributing to the sharp decline in poverty rates.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Direct Benefit Transfers (DBTs):<\/strong> Programs like <strong>Jan Dhan Yojana and PM Kisan Samman Nidhi Yojana<\/strong> have provided financial support to vulnerable populations.\n<ul class=\"wp-block-list\">\n<li>The impact of these schemes, though not fully understood, has been captured through revised methodologies in the HCESs of 2022-23 and 2023-24.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Other Flagship Initiatives<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA):<\/strong> It provides 100 days of guaranteed wage employment annually to rural households.\n<ul class=\"wp-block-list\">\n<li>It focuses on strengthening the livelihood resource base of marginalized communities.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Mission Antyodaya:<\/strong> A convergence framework to optimize resources allocated by 26 ministries for rural development.\n<ul class=\"wp-block-list\">\n<li>Gram Panchayats serve as focal points for implementation.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Deendayal Antyodaya Yojana &#8211; National Rural Livelihoods Mission (DAY-NRLM):<\/strong> It empowers rural women through community institutions that provide financial, technical, and marketing support.\n<ul class=\"wp-block-list\">\n<li>It facilitates access to government schemes like Swachh Bharat Mission and Poshan Abhiyan.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Pradhan Mantri Awas Yojana \u2013 Gramin (PMAY-G):<\/strong> It aims to provide housing for the poorest segments of society.\n<ul class=\"wp-block-list\">\n<li>It uses a three-stage validation process to ensure aid reaches deserving individuals.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Pradhan Mantri Gram Sadak Yojana (PMGSY): <\/strong>It aims to provide connectivity to unconnected habitations as part of a poverty reduction strategy.\n<ul class=\"wp-block-list\">\n<li>It ensures high technical and management standards for rural road networks.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Multidimensional Poverty Reduction Initiatives:<\/strong> India\u2019s multidimensional poverty declined from 29.17% in 2013-14 to 11.28% in 2022-23, lifting 24.82 crore people out of poverty.\n<ul class=\"wp-block-list\">\n<li>The <strong>National Multidimensional Poverty Index (MPI)<\/strong> assesses deprivation across <strong>health, education, and living standards.<\/strong><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Conclusion<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>India\u2019s remarkable reduction in extreme poverty demonstrates the effectiveness of targeted government programs and robust food security measures.&nbsp;<\/li>\n\n\n\n<li>However, challenges such as persistent inequality, inconsistent data, and the struggle of millions to sustain a basic standard of living highlight the need for continued efforts.&nbsp;<\/li>\n\n\n\n<li>As India moves forward, balancing welfare schemes with sustainable economic policies will be crucial for building an equitable and inclusive society.<\/li>\n<\/ul>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-background\" style=\"background-color:#fff2cc\"><tbody><tr><td><strong>Daily Mains Practice Question<\/strong><br><strong>[Q]<\/strong> Examine the factors contributing to the decline in extreme poverty in India as highlighted in the World Bank\u2019s &#8216;Poverty and Equity Brief.&#8217; How do government initiatives impact poverty alleviation, and what challenges remain in addressing income inequality and economic disparities?<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p><a href=\"https:\/\/www.thehindubusinessline.com\/opinion\/editorial\/not-so-poor\/article69497440.ece\" rel=\"nofollow noopener\" target=\"_blank\">Source: BL<\/a><\/p>\n\n\n\n<div class=\"wp-block-buttons is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link wp-element-button\" href=\"https:\/\/www.nextias.com\/ca\/wp-content\/uploads\/2025\/04\/UPSC-Editorial-Analysis-28-April-2025.PDF.pdf\">Download PDF<\/a><\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Recently, the World Bank\u2019s released Poverty and Equity Brief on India offers a complex picture of the socio-economic landscape of India, and raises questions about broader economic inequality and the reliability of data in capturing socio-economic trends.<\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[22],"tags":[],"class_list":["post-42195","post","type-post","status-publish","format-standard","hentry","category-editorial-analysis"],"acf":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/42195","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=42195"}],"version-history":[{"count":2,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/42195\/revisions"}],"predecessor-version":[{"id":42237,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/42195\/revisions\/42237"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=42195"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=42195"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=42195"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}