'Statistical outlier': India defies global trend, lifts 171 million out of extreme poverty, finds World Bank

India has recorded a dramatic decline in extreme poverty over the past decade, emerging as a global statistical outlier in a positive direction, according to a new World Bank report. The country's extreme poverty rate fell from 27.1% in 2011–12 to just 5.3% in 2022–23—even after the poverty threshold was revised upward from USD 2.15 to USD 3 per day in 2021 purchasing power parity (PPP) terms.

The new poverty line, adjusted for inflation and global economic conditions, raised the bar by 15% compared to the previous threshold. Despite this, India showed remarkable progress: the number of people living below the revised line dropped from 34 crore in 2011–12 to just 7.5 crore in 2022–23.

"While the change led to a global increase in the count of extreme poverty by 125 million, India emerged as a statistical outlier in a positive direction. Using more refined data and updated survey methods, India not only withstood the raised threshold but also demonstrated a massive reduction in poverty," said the Press Information Bureau (PIB), citing the World Bank's findings.

In fact, India's data revision helped reduce the global poverty count by 125 million, effectively offsetting what would have been a larger global increase of 226 million people due to the updated threshold.

The World Bank's 2024 estimate put the poverty rate at USD 3 per day at 5.44%, with 54.7 million people living below that line. On the older USD 2.15 metric, India’s extreme poverty dropped from 16.2% to 2.3% between 2011–12 and 2022–23, lifting 171 million people out of extreme deprivation. The rural-urban poverty gap also narrowed substantially, with rural poverty falling from 18.4% to 2.8% and urban poverty from 10.7% to 1.1%.

The report attributed much of this progress to welfare schemes and food security programmes, noting that free and subsidised food transfers had a measurable impact. Notably, the five most populous states still account for 54% of the extremely poor.

On the macroeconomic front, the World Bank projected that India’s real GDP in FY25 would remain about 5% below pre-pandemic trend levels, but expects a gradual return to potential growth by 2027–28. However, it flagged global policy shifts and trade tensions as key downside risks that could weigh on exports and investment recovery.

The current account deficit is projected to average around 1.2% of GDP over FY26–28, with foreign exchange reserves expected to stay stable at around 16% of GDP.