The World Bank estimates that India lifted 496 million people out of poverty between 2011 and 2023.
Multidimensional poverty also fell substantially, but around 57 per cent of India's poor population remains concentrated in a belt stretching from Uttar Pradesh to West Bengal.
The report identifies youth unemployment, stagnant real wages and low-productivity jobs as key challenges to sustaining poverty reduction.
India lifted an estimated 496 million people out of poverty between 2011 and 2023, with the share of the population living in extreme poverty falling from 27.1 per cent to 2.6 per cent, according to the World Bank’s October 2026 Poverty and Equity Brief. The report described the decline as “one of the fastest poverty declines in the world”, attributing the progress to rising consumption, increased employment and expanded social transfers, including food subsidies.
The proportion of Indians living below the lower-middle-income poverty line of USD 4.20 a day, measured at 2021 purchasing power parity (PPP), also dropped sharply from 57.7 per cent to 16.1 per cent during the period. The World Bank said the country had recorded improvements across both monetary and non-monetary measures of poverty.
Poverty is expected to decline further, although at a slower pace. The 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.
Multidimensional Poverty Declines, But Regional Gaps Persist
The report also highlighted a substantial reduction in non-monetary poverty. 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.
Despite the overall progress, poverty remains concentrated in certain parts of the country. Around 57 per cent of India's poor population lives in a contiguous belt stretching from Uttar Pradesh to West Bengal, the report said, underlining the importance of creating productive employment opportunities in these states to sustain poverty reduction.
The report identified employment growth, particularly among women, as a major contributor to the decline in poverty. 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, the gains in employment have not necessarily translated into higher earnings. Real wages remained broadly unchanged, while much of the employment growth was concentrated in relatively low-productivity activities.
Youth Unemployment And Low Earnings Pose Challenges
The World Bank flagged rising youth unemployment as a continuing concern. The rate increased from 14.6 per cent to 15.9 per cent between the first quarters of FY26 and FY27, with rural young women particularly affected.
The report's findings point to a gap between the expansion of employment and the availability of better-paying, more productive work. Sustaining poverty reduction will therefore depend not only on creating jobs but also on improving earnings and expanding access to productive employment.
The bank also cautioned that poverty estimates are based on household consumption surveys. Some of the recent gains may reflect improvements in measurement alongside genuine improvements in living standards.
While India's poverty indicators have improved considerably over the past decade, the report suggests that addressing regional disparities, youth unemployment and low-productivity employment will remain important to ensuring that the progress continues.
