India’s achievements over the last decade in reducing extreme poverty have been significant. According to the latest World Bank data on poverty levels across the world, India stands out as an outlier, with the rest of the world seeing a spike in poverty, post Covid. A low-income-country poverty line of $3 per capita per day (2021 prices) would perhaps work to ₹80 in purchasing power parity terms.

India’s poverty stood at 5.25 per cent in 2022, against 27.12 per cent in 2011 based on this measure (adjusted for inflation and other data gathering issues), implying that nearly 270 million broke free of the clutches of dire poverty during this period. While it may be argued that the poverty line is low, it is yet noteworthy that India has been able to reduce extreme misery to single digit, although a number of 75 million below this level, is still large. Poverty in India is not stark, in-your-face anymore. Income and food support programmes have clearly made a big difference here. These programmes implemented by the Centre and States have also ensured that people are able to set aside sums for other essentials and improve their living standards. India, therefore, finds a special mention in the World Bank briefing for its poverty-breakout performance.

The decadal results are similar when the Rangarajan poverty line (drawn up a decade ago and adjusted for current price levels) is juxtaposed with the Household Consumer Expenditure Survey data of FY23 and FY24. It may be recalled that the Rangarajan report a decade ago was the outcome of a furore over the Tendulkar poverty line, which was regarded as absurdly low because it did not go beyond calorific needs. The World Bank uses Household Consumer Expenditure Survey data as a proxy for income, but removes ‘lumpy expenditures’ such as hospitalisation, durable expenses and house rental values. It uses the mixed recall period (to capture different items of consumption) and applies it backwards to the 2011 HCES (based on uniform recall period sampling) to ensure comparability. It draws its four global poverty lines for different categories of countries by making a dollar PPP adjustment of various national poverty lines and taking a median value.

In India’s case, it appears that the outmoded Tendulkar poverty line has been used in a souped-up form. This is because the Rangarajan line was not officially acknowledged. The NITI Aayog’s multi-dimensional poverty index is a different metric altogether, akin to HDI. Therefore, it is high time that a credible income poverty line is drawn up. The Gini index, a measure of inequality, too has fallen from 28.78 to 25.51 between 2011 and 2022, although the World Bank seems to have said that the Household Consumer Expenditure Surveys might have underestimated consumption at higher levels of income. Be that as it may, there is no denying that grinding poverty is fast disappearing quite uniformly across the length and breadth of the country, with backward States too turning ‘aspirational’.

Published on June 12, 2025