Extreme poverty in India has decreased by 12.3 percentage points during 2011-2019: World Bank

The rate of extreme poverty in India has witnessed a significant decline over the past decade, according to a recent World Bank report. The report shows that extreme poverty in India is 12.3 percentage points lower in 2019 than in 2011.

According to the data mentioned by the World Bank, the poverty headcount rate has declined from 22.5 percent in 2011 to 10.2 percent in 2019, with a major decline in the percentage witnessed in rural areas of the country.

The findings of a working paper on the World Bank policy research said India has almost eradicated extreme poverty from the population over the past decade and has brought down consumption inequality to its lowest levels in 40 years through state-provided food handouts.

While the poverty levels went down to 11.6 percent in rural areas of India in 2019, the level of urban poverty stood at 6.3 percent during the same time period. The poverty reduction in rural areas was much higher as compared to that in urban areas.

World Bank’s working paper, which is titled ‘Poverty in India Has Declined over the Last Decade But Not As Much As Previously Thought’, states, “Rural and urban poverty dropped by 14.7 and 7.9 percentage points during 2011-2019.”

The paper, which was jointly authored by economists Sutirtha Sinha Roy and Roy van der Weide, states that there has been a higher income growth for farmers who own small-sized lands.

The paper further states, “Real incomes for farmers with the smallest landholdings have grown by 10 percent in annualized terms between the two survey rounds [2013 and 2019] compared to a 2 percent growth for farmers with the largest landholding.”

The research paper by World Bank also noted that though there was an overall dip in the percentage of extreme poverty in India, poverty marginally increased at least two times over the course of the last decade. This was noted in 2016 and 2017, around the time of the demonetization of Indian currency notes.

Last week, a report by the International Monetary Fund (IMF) stated that less than 1 percent of the Indian population is living in extreme poverty, and with major food schemes in play, poverty in India did not rise during the Covid-19 pandemic.

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