{"id":131489,"date":"2026-11-01T10:48:16","date_gmt":"2026-11-01T05:18:16","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=131489"},"modified":"2026-11-01T12:17:13","modified_gmt":"2026-11-01T06:47:13","slug":"extreme-poverty-in-india","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/extreme-poverty-in-india\/","title":{"rendered":"Extreme Poverty in India &#8211; Declining Poverty, Persistent Employment Challenges"},"content":{"rendered":"<h2 style=\"text-align: justify;\"><b>Extreme Poverty in India Latest News<\/b><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The World Bank\u2019s (WB) latest Poverty &amp; Equity Brief indicates that India\u2019s extreme poverty rate has <\/span><b>declined significantly<\/b><span style=\"font-weight: 400;\">.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">However, persistent unemployment, stagnant real earnings and regional disparities raise concerns about the sustainability of poverty reduction.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The central challenge is to translate economic growth into productive employment, higher incomes and improved living standards, particularly in India\u2019s poorer states.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Declining Poverty &#8211; WB Estimates<\/b><\/h2>\n<ul>\n<li aria-level=\"1\"><b>Significant reduction in poverty:<\/b>\n<ul>\n<li><span style=\"font-weight: 400;\">Extreme poverty, measured using the World Bank\u2019s <\/span><b>$3-per-day<\/b><span style=\"font-weight: 400;\"> poverty line, declined from <\/span><b>5.3%<\/b><span style=\"font-weight: 400;\"> in 2022 to <\/span><b>2.6%<\/b><span style=\"font-weight: 400;\"> in 2023.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Using the Lower Middle-Income Country (LMIC) threshold of $4.20 per day, poverty declined from 23.9% to 16.1%.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">The poverty rate under the $4.20 threshold is projected to decline further to 14.2% in 2026 and 12.1% by 2028.<\/span><\/li>\n<\/ul>\n<\/li>\n<li aria-level=\"1\"><b>Employment remains the critical determinant:<\/b>\n<ul>\n<li><span style=\"font-weight: 400;\">The WB emphasises that future poverty reduction depends on the creation of <\/span><b>productive jobs<\/b><span style=\"font-weight: 400;\"> in India\u2019s poorest states.<\/span><\/li>\n<li><b>For example,<\/b>\n<ul>\n<li><span style=\"font-weight: 400;\">Youth unemployment increased to 15.9% over the preceding year.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Real earnings have remained largely stagnant.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">The sustainability of poverty reduction depends on employment <\/span><b>quality<\/b><span style=\"font-weight: 400;\">, not merely employment numbers.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>The \u2018Feeling\u2019 of Growth &#8211; A Disconnect Between GDP and Incomes<\/b><\/h2>\n<ul>\n<li aria-level=\"1\"><b>Economic growth without equitable gains:<\/b>\n<ul>\n<li><span style=\"font-weight: 400;\">India recorded GDP growth of 7.8% in the April\u2013June quarter, exceeding most forecasts.\u00a0<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Yet, the benefits of growth are not uniformly reflected in household incomes and living standards.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">The International Labour Organization (ILO) highlights a weakening relationship between productivity and wages.<\/span><\/li>\n<li><b>For example,<\/b>\n<ul>\n<li><span style=\"font-weight: 400;\">The global share of income accruing to labour declined from approximately 54% in 2004 to 52.6% in 2025.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Rising productivity does not necessarily translate into proportionately higher wages.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">This <\/span><b>weakens purchasing power<\/b><span style=\"font-weight: 400;\"> and limits the ability of economic growth to reduce poverty.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<li aria-level=\"1\"><b>Demographic dividend under pressure:<\/b>\n<ul>\n<li><span style=\"font-weight: 400;\">India\u2019s demographic dividend cannot be taken for granted.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">For instance,<\/span>\n<ul>\n<li><span style=\"font-weight: 400;\">Youth unemployment and <\/span><b>inadequate skills<\/b><span style=\"font-weight: 400;\"> threaten the productive absorption of the working-age population.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Excessive <\/span><b>dependence <\/b><span style=\"font-weight: 400;\">on smartphones, <\/span><b>social media<\/b><span style=\"font-weight: 400;\"> and AI raises concerns about attention spans, cognitive skills and social well-being.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Unlike earlier ageing economies, India must manage demographic pressures alongside rapid technological transformation.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Regional Concentration of Poverty<\/b><\/h2>\n<ul>\n<li aria-level=\"1\"><b>A new BIMARU?<\/b>\n<ul>\n<li><span style=\"font-weight: 400;\">The World Bank estimates that 57% of India\u2019s poor live in a contiguous belt extending from <\/span><b>UP to West Bengal<\/b><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">This recalls the term BIMARU, coined by demographer Ashish Bose to describe Bihar, Madhya Pradesh, Rajasthan and UP.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">The emerging poverty belt suggests a shift in the geographical concentration of poverty, with West Bengal becoming an important part of the region.<\/span><\/li>\n<\/ul>\n<\/li>\n<li aria-level=\"1\"><b>Poverty estimates based:<\/b>\n<ul>\n<li><span style=\"font-weight: 400;\">The earlier <\/span><b>Rangarajan <\/b><span style=\"font-weight: 400;\">Committee estimated the monthly per capita poverty line at &#8211; <\/span><b>Urban areas<\/b><span style=\"font-weight: 400;\">: \u20b91,407 (approximately \u20b947 per day); and <\/span><b>Rural areas<\/b><span style=\"font-weight: 400;\">: \u20b9972 (approximately \u20b932 per day).\u00a0<\/span><\/li>\n<li><span style=\"font-weight: 400;\">It estimated India\u2019s poverty rate at <\/span><b>29.5%.<\/b><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>State-wise poverty rates (2022\u201323):<\/b><span style=\"font-weight: 400;\">\u00a0<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Chhattisgarh (25.1% rural poverty, 13.3% urban), Jharkhand (16.6% and 12.6%), MP (9.6% and 11.6%), WB (7.5% and 12.4%), Bihar (5.9% and 9.1%), and UP (5.7% and 9.9%).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Despite relatively high poverty levels, these states have achieved substantial reductions between 2011\u201312 and 2022\u201323.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Urban <\/span><b>Bihar <\/b><span style=\"font-weight: 400;\">recorded the largest decline among states, from 50.8% to 9.1%.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Employment Challenges &#8211; A New Reckoning<\/b><\/h2>\n<ul>\n<li><span style=\"font-weight: 400;\">The WB estimates that employment increased by <\/span><b>13.4 crore <\/b><span style=\"font-weight: 400;\">between 2017 and 2023, nearly twice the increase in the working-age population. However, there is a mismatch between employment quantity and quality.<\/span><\/li>\n<li><b>Emerging concerns:<\/b>\n<ul>\n<li><b>Wage stagnation<\/b><span style=\"font-weight: 400;\">: Factory workers\u2019 wages in Jharkhand declined by 5.2% in 2024\u201325, against an all-India increase of 5.3%.<\/span><\/li>\n<li><b>NEET youth<\/b><span style=\"font-weight: 400;\">: In 2025, 81% of Bihar\u2019s districts had more than one-fourth of their 15\u201329-year-olds neither employed nor in education or training (NEET).\u00a0<\/span><\/li>\n<li><b>Regional disparities<\/b><span style=\"font-weight: 400;\">: Poorer states face inadequate industrial diversification, low productivity and limited access to quality employment.<\/span><\/li>\n<li><b>AI-driven disruption<\/b><span style=\"font-weight: 400;\">: Automation may intensify pressure on low-skilled workers and require large-scale reskilling.<\/span><\/li>\n<\/ul>\n<\/li>\n<li><span style=\"font-weight: 400;\">Nevertheless, progress is visible. UP recorded the largest increase in the number of factories in 2024\u201325, at <\/span><b>12.8%<\/b><span style=\"font-weight: 400;\">.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Way Forward<\/b><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Labour-intensive manufacturing<\/b><span style=\"font-weight: 400;\">: Promote textiles, food processing, footwear and other employment-intensive sectors in poorer states.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Human capital development<\/b><span style=\"font-weight: 400;\">: Strengthen foundational literacy, vocational education, healthcare and digital skills to improve labour productivity.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Decentralised development<\/b><span style=\"font-weight: 400;\">: Improve infrastructure, logistics, urbanisation and investment conditions in lagging regions.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Employment quality<\/b><span style=\"font-weight: 400;\">: Focus on formalisation, social security, minimum wages and productive self-employment.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Evidence-based policy<\/b><span style=\"font-weight: 400;\">: Use updated consumption surveys, employment data and multidimensional poverty indicators to identify vulnerable groups.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Conclusion<\/b><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India\u2019s declining poverty is a significant development achievement, but sustaining it requires a transition from growth-led poverty reduction to <\/span><b>employment-led inclusive development.\u00a0<\/b><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Creating productive jobs, improving real wages and addressing regional inequalities will be essential to realise the demographic dividend and achieve the vision of Viksit Bharat by 2047.<\/span><\/li>\n<\/ul>\n<p style=\"text-align: justify;\"><b>Source: <\/b><a href=\"https:\/\/indianexpress.com\/article\/explained\/explained-economics\/india-poverty-rate-world-bank-jobs-unemployment-explained-10945066\/\" target=\"_blank\" rel=\"nofollow noopener\"><b>IE<\/b><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The World Bank\u2019s (WB) latest Poverty &#038; Equity Brief indicates that extreme poverty in India declined significantly.<\/p>\n","protected":false},"author":19,"featured_media":131525,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[18],"tags":[11279,60,22,59],"class_list":["post-131489","post","type-post","status-publish","format-standard","has-post-thumbnail","category-upsc-mains-current-affairs","tag-extreme-poverty-in-india","tag-mains-articles","tag-upsc-current-affairs","tag-upsc-mains-current-affairs","no-featured-image-padding"],"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/131489","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/19"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=131489"}],"version-history":[{"count":4,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/131489\/revisions"}],"predecessor-version":[{"id":131523,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/131489\/revisions\/131523"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/131525"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=131489"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=131489"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=131489"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}