India's poverty rate, measured against the World Bank's $4.20-a-day poverty line, is projected to decline from 14.2% in 2026 to 12.1% by 2028, according to the lender's latest Poverty and Equity Brief. The bank attributed the projected decline to household consumption, employment growth and welfare transfers.
The report estimates that the proportion of Indians living below the $4.20-a-day threshold fell from 57.7% in 2011 to 16.1% in 2023, lifting around 496 million people out of poverty. At the $3-a-day extreme-poverty threshold, the share declined from 27.1% to 2.6% during the same period.
Union Finance Minister Nirmala Sitharaman welcomed the findings, saying the government's sustained policy efforts were yielding tangible results. In a post on X, she credited Prime Minister Narendra Modi's leadership and said the government would continue to focus on productive employment, higher household incomes and efficient public service delivery.
The World Bank attributed the decline in poverty primarily to consumption growth, rising employment, particularly among women, and expanded social transfers, including food subsidies. Employment increased by around 134 million between 2017 and 2023, nearly twice the growth in the working-age population, with more rural women entering paid work.
However, the report flagged persistent challenges in the labour market. Youth unemployment rose from 14.6% to 15.9% between the first quarters of FY2026 and FY2027, with rural young women among the most affected. Real earnings remained broadly stagnant, while employment growth was concentrated in low-productivity work.
Income disparities also remained pronounced. The median earnings of the top 10% of workers were around 13 times those of the bottom 10% in 2023. The report noted that poverty is increasingly concentrated among households with lower levels of education, fewer assets and limited access to stable employment.
The findings come amid continuing debate over poverty estimates and the methodology used to measure economic deprivation. Economists have raised questions about the data, although the specific objections were not detailed in the reports available.
(With inputs from media reports)