Poverty In India Reduced Via Tangible Boost In Household Living Standards, Incomes

India has demonstrated a significant decline in poverty, not just on paper but through improved household living standards, according to a government factsheet released on Saturday. This follows the World Bank’s revision of the International Poverty Line (IPL) from $2.15 to $3.00 per day (at 2021 PPP).

While this global adjustment led to a net increase of 125 million in the global poverty count, India emerged as a positive outlier.

Updated national data from India alone reduced the global count by 125 million, offsetting what could have been a larger global surge in poverty.

Revised Methods Reveal Real Gains

India’s adoption of the Modified Mixed Recall Period (MMRP) in its latest Household Consumption Expenditure Survey (HCES) marked a crucial shift.

The MMRP approach captures spending on frequently purchased items more accurately than the older Uniform Reference Period (URP).

In 2022–23, poverty under the revised $3.00 line stood at just 5.25 per cent in India. Under the older $2.15 line, the rate dropped even further to 2.35 per cent. In 2011–12, using MMRP had already reduced India’s poverty rate from 22.9 per cent to 16.22 per cent.

Rising Incomes, Narrowing Gaps

Average monthly per capita expenditure (MPCE) in 2023–24 rose to ₹4,122 in rural areas and ₹6,996 in urban areas. Including free welfare items, MPCE further rose to ₹4,247 (rural) and ₹7,078 (urban). This is a substantial jump from ₹1,430 and ₹2,630 in 2011–12.

The urban-rural consumption gap fell from 84 per cent in 2011–12 to 70 per cent in 2023–24, showing improved parity. All 18 major states recorded higher MPCE. Odisha led rural gains at 14 per cent, while Punjab saw a 13 per cent increase in urban areas.

The Gini coefficient dropped from 0.266 to 0.237 in rural areas and from 0.314 to 0.284 in urban areas between 2022–23 and 2023–24, indicating reduced inequality.

India’s approach, the factsheet said, blends data integrity with effective policy. As the world recalibrates poverty goals, India offers a model of governance driven by evidence and equity.

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