Context: 

"The recent NSO Household Consumption Surveys (2022–23 and 2023–24), along with a World Bank report, confirm a significant decline in poverty rates in India, primarily attributed to robust GDP growth and a reduction in inequality."

Key Highlights from NSO Household Consumption Expenditure Surveys and Poverty Trends

Poverty Trends in India (2011–2024)

• Significant Reduction in Poverty Headcount:
  The national poverty rate declined sharply from 29.5% in 2011–12 to 4.9% in 2023–24, marking a 24.6 percentage point decrease.
• Strong Progress Against Global Poverty Benchmarks:
  • Extreme Poverty (below $2.15/day, PPP) fell from 16.2% to 2.3% (World Bank).
  • Poverty under the $3.65/day threshold dropped from 61.8% to 28.1%.
• Economic Growth and Inflation Control as Key Drivers:
  • India’s GDP growth rose to 9.2% in 2023–24.
  • CPI inflation moderated to 5.4%, improving real incomes and household purchasing power.
• Poverty Concentrated Near the Line:
  Over half of those in poverty are clustered just below the poverty threshold, enabling more precise and impactful targeting of welfare programs.

Challenges to Poverty Eradication in India

• High Vulnerability to Economic and Climate Shocks:
  A significant share of the population remains just above the poverty line, making them highly susceptible to falling back due to health emergencies, climate-related events, or economic disruptions.
• Gaps in Welfare Coverage:
  Social safety nets remain uneven, particularly for the urban poor and migrant workers. For example, access to the Public Distribution System (PDS) is still limited in many urban areas.
• Rising Food Inflation:
  Food price inflation reached 7.5% in 2023–24, disproportionately affecting low-income households who spend a large share of their income on essentials.
• Underrepresentation in Urban Poverty Data:
  Recent surveys tend to undercount informal sector workers and those in unregulated urban employment, leading to gaps in policy design.
• Persistent Regional Inequalities:
  States such as Bihar, Jharkhand, and Odisha continue to experience high poverty rates, highlighting the need for region-specific interventions despite overall national progress.

Way Forward

• Expand Targeted Cash Transfers:
  Scale up and refine programs like PM-GKAY and Direct Benefit Transfers (DBT) for LPG to support households just above the poverty line, especially during crises.
• Strengthen Rural Employment Programs:
  Enhance funding and implementation of MGNREGA, with a focus on climate-resilient and sustainable job creation.
• Develop Urban Social Protection Systems:
  Establish a comprehensive urban safety net tailored for gig economy workers, daily wage earners, and migrant families.
• Invest in Human Capital:
  Address learning loss and malnutrition by expanding programs like PM-POSHAN (Midday Meal Scheme) and Saksham Anganwadi for early childhood development.
• Institutionalize Real-Time Poverty Monitoring:
  Launch annual, multidimensional poverty assessments using real-time and digital data sources for timely and targeted policy action.

Conclusion

India has achieved a historic milestone by reducing poverty to below 5% for the first time, driven by strong economic growth and reduced consumption inequality. However, sustaining this progress requires a continued emphasis on inclusive welfare systems, resilience-building, and targeted investments in human development.