India lifts 496 million out of poverty, World Bank says

India lifted 496 million people out of poverty between 2011 and 2023, according to a new World Bank report released this week. The share of the population living below the lower middle-income threshold of $4.20 a day dropped from 57.7 percent to 16.1 percent during that 12-year period.

The report notes that extreme poverty, defined as living on less than $3 a day, fell from 27.1 percent to 2.6 percent. The authors, led by World Bank South Asia poverty economist Ayago Wambile, attribute this shift to strong consumption growth, rising employment among women, and expanded social transfers. They project the $4.20/day poverty rate will continue to decline, falling from 14.2 percent in 2026 to 12.1 percent by 2028.

Prime Minister Narendra Modi praised the figures in a social media post on Sunday, calling it a historic fall in poverty and a generational rise in opportunity. The World Bank cited Household Consumption Expenditure Surveys conducted by the National Sample Survey Organisation to determine these rates. A 2022 joint report from the World Bank and the Chinese Finance Ministry noted that China lifted 800 million people out of poverty, but that process took 40 years.

Despite the drop in absolute poverty, income inequality in India has widened since the country opened its economy in the early 1990s. The 2026 World Inequality Report identifies India as one of the most unequal nations globally. In 2023, median earnings for the top 10 percent of workers were approximately 13 times higher than those of the bottom 10 percent. The top 10 percent of earners now capture about 58 percent of national income, while the bottom 50 percent receives only 15 percent.

Economists point to specific policies that drove the reduction. The government provides free food grains to roughly 800 million Indians, a program expanded under the current administration. Access to piped drinking water in rural homes rose from 17 percent in August 2019 to more than 80 percent, according to government statistics. Surjit Bhalla, a former executive director at the International Monetary Fund, and Karan Bhasin wrote in a 2024 Brookings Institution paper that reduced sickness from safe water access likely helped families earn more income.

Critics argue the progress masks deep structural issues. Jayati Ghosh, a professor at the University of Massachusetts Amherst, noted that India spends just over 1 percent of its gross domestic product on public healthcare. She stated that stagnant real wages and high medical costs push millions into debt. Nitin Kumar Bharti, a lecturer at the University of Western Australia, emphasized that 233 million people still live below the $4.20 per day line. He added that the extent of improvement in overall wellbeing remains an important question.

Santosh Mehrotra, a visiting professor at the Higher School of Economics in Moscow, questioned the reliance on international data. He noted that the Indian government stopped calculating its own poverty levels after 2014. Bhalla countered that the World Bank methodology is vetted by Indian scholars and the government, making it a credible standard for global comparison.