India lifted nearly 500 million out of poverty between 2011 and 2023, with extreme poverty dropping from 27.1 percent to 2.6 percent in the world’s most populous nation during the same period, according to a new report by the World Bank.
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poverty → lift → Bank
The only other parallel in poverty reduction on this scale is China, which lifted more than 800 million people out of extreme poverty — though that was over a period of 40 years.
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that → lift → years
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protesters → become → names
Yet despite the substantial fall in poverty in India — home to 1.4 billion people — the income and wealth inequality gap has widened significantly since it opened up its economy in the early 1990s.
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it → widen → 1990s
According to the 2026 World Inequality Report, inequality in India remains among the highest in the world.
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inequality → accord → world
We take a look at how India managed to almost eradicate extreme poverty, and at the contrast between that accomplishment and the deep economic inequality that remains in the world’s most populous nation:
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that → take → nation
What does the World Bank data say?
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data → say → What
Based on an extreme poverty threshold of $3 a day, the World Bank said extreme poverty in India declined from 27.1 percent to 2.6 percent between 2011 and 2023.
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poverty → base → 2011
Extreme poverty is defined as the minimum amount of money needed to afford basic essentials such as food, water, shelter and clothing.
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poverty → define → food
Estimating poverty metrics based on three official household surveys, the Bank also said that an estimated 496 million people have been lifted out of poverty as the share of India’s population living below the lower middle-income poverty threshold of $4.20 a day fell from 57.7 percent to 16.1 percent.
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share → estimate → percent
The authors of the report, led by World Bank’s South Asia poverty economist Ayago Wambile, wrote that poverty in India is “projected to continue declining, albeit more gradually with the poverty rate at the $4.20/day line expected to fall from 14.2 percent in 2026 to 12.1 percent by 2028.”
“This progress was mainly driven by strong consumption growth, rising employment, especially among women, and expanded social transfers, including food subsidies,” they added.
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they → lead → subsidies
India lifting nearly 500 million out of poverty in 12 years has been lauded as “remarkable progress” by the World Bank.
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India → lift → Bank
It added that the downward trend represents “one of the fastest poverty declines in the world.”
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trend → add → world
To determine India’s poverty rates, the World Bank used Household Consumption Expenditure Surveys (HCES) which were conducted by the National Sample Survey Organisation (NSSO), an Indian government body.
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which → determine → Organisation
A 2022 report, jointly produced by the World Bank and the Chinese Finance Ministry, said that China had lifted 800 million people out of poverty, but it took 40 years to achieve.
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it → produce → years
Last month, the World Bank also raised its economic growth forecast for India to 7.1 percent.
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Bank → raise → percent
In a post on Instagram on Sunday, India’s Prime Minister Narendra Modi lauded the country’s progress in tackling poverty.
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Modi → laud → poverty
A generational rise in opportunity,” he said.
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he → say → opportunity
Last November, the southern state of Kerala, which has been ruled either by the centrist Congress party or a coalition of communist parties since independence, became the first in the country to officially declare itself free from extreme poverty.
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itself → rule → poverty
Kerala has the best education and health statistics of major Indian states.
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Kerala → have → states
Santosh Mehrotra, a development economist formerly in India’s planning commission, and currently a visiting professor at the Higher School of Economics in Moscow, noted that India is the only low-middle-income country among G20 nations, which are otherwise upper-middle- or high-income nations.
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which → visit → nations
So therefore, if we are going to genuinely reduce the incidence of poverty and more importantly, the absolute number of the poor, then it makes a huge difference globally,” he told Al Jazeera.
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he → go → Jazeera
Coming from the World Bank, the credibility of the analysis that has concluded India’s success in reducing poverty so majorly is also above question, said Surjit Bhalla, economist an a former executive director at the International Monetary Fund.
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Bhalla → come → Fund
Any data that comes from the World Bank, he said, is the “gold standard”.
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he → come → Bank
He said the institution carries out a poverty analysis for every country using a per capita consumption level that is normalised globally by invoking purchasing power parity.
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that → say → parity
How did India dramatically cut poverty?
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India → cut → poverty
But economists point to a series of factors and programmes that might have contributed to India’s success in pulling record numbers of people out of poverty.
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that → point → poverty
Overall, poverty in India has, however, been declining since the country opened its economy in the early 1990s, when the Congress party was in power, setting the stage for more than three decades of fast economic growth.
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party → decline → growth
Successive governments have launched, continued or reworked a series of social welfare schemes that economists say have helped combat poverty.
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economists → launch → poverty
Prime Minister Modi’s predecessor Manmohan Singh, for example, launched an employment scheme that guaranteed rural jobs for a minimum of 100 days per year.
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that → launch → year
Since coming to power in 2014, Modi has launched several other welfare schemes, including direct cash transfers, free rations and housing, to tackle poverty.
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Modi → come → poverty
While the Modi government has significantly diluted the rural job guarantee scheme that Singh had launched, the current administration now provides free food grains to about 800 million Indians.
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administration → dilute → Indians
Under Modi, the government has also significantly expanded the construction of toilets, especially in rural India, where open defecation has historically been common in many villages.
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defecation → expand → villages
Access to piped drinking water has risen from 17 percent of rural homes in August 2019 to more than 80 percent, according to government statistics.
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Access → rise → statistics
“The reduced sickness from accessing safe water may have helped families earn more income,” economists Surjit Bhalla and Karan Bhasin wrote in a research paper on India’s poverty alleviation efforts for the Brookings Institution in March 2024.
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Bhalla → reduce → March
Before the latest World Bank report, Bhalla — a former executive director at the International Monetary Fund (IMF) — and Bhasin had used Indian consumption data in early 2025 to also conclude that the country was making major gains in ending extreme poverty.
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country → use → poverty
Why some economists are concerned
Despite the decline in poverty, Bhalla and Bhasin pointed in their 2025 paper that free food grains supplied by the Indian government to 800 million people only fulfilled their calorific needs.
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grains → point → needs
“More balanced food subsidies that are better targeted to the genuine poor will improve nutritional outcomes and would represent a better approach to food insecurity,” they wrote.
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they → target → insecurity
It is also unclear whether continuing to provide free food supplies indefinitely to more than half of the country’s population is sustainable for the government — and whether that programme points to deep economic distress mitigated only by state assistance.
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programme → continue → assistance
Some economists, like Mehrotra, question why the Indian government no longer determines its own poverty level and its own estimates of the numbers of those below it.
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government → question → it
…and 45 more, not listed.
The Aporia
