Extreme poverty in India fell by 12.3 percentage points between 2011 and 2019: Wb Paper


Extreme poverty in India fell by 12.3 percentage points between 2011 and 2019, with rural areas doing better than urban centers, according to a World Bank working paper.

India has not released a new household consumption survey since the 2011 NSS. The country has not released any official estimates of poverty and inequality for more than a decade now, the document added. -written by economists Sutirtha Sinha Roy and Roy van der Weide.

Earlier, an International Monetary Fund (IMF) working paper said the Pradhan Mantri Garib Kalyan Yojana (PMGKAY), which provides free food grains to the poor, had played a key role in sustaining extreme poverty in India at the lowest level of 0.8%. during the 2020 pandemic.

“We find that extreme poverty in India decreased by 12.3 percentage points between 2011 and 2019, but at a significantly lower rate than that observed over the period 2004-2011.”

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“Poverty reduction rates in rural areas are higher than in urban areas,” says the paper, titled “Poverty in India has declined over the past decade, but not as much as previously thought.” .

The authors further stated that urban poverty increased by 2 percentage points in 2016 during the demonetization event and declined sharply thereafter. Rural poverty increased by 10 basis points in 2019, likely due to slower growth.

“Our poverty estimates for recent periods are more conservative than earlier projections based on consumption growth in national accounts and other survey data,” the paper said.

The paper further indicates that the magnitude of poverty reduction over the period 2015-2019 is estimated to be significantly lower than previous projections based on growth in private final consumption expenditure reported in national accounts statistics.

The authors also said there was no evidence of an increase in consumption inequality in their analysis. The paper notes that farmers with small farms experienced higher income growth.

Real incomes for farmers with the smallest holdings increased by 10% in annualized terms between the two rounds of surveys, compared with a 2% growth for farmers with the largest holdings, he said. Rural households with smaller plots of land are more likely to be poorer than others, he added.

(Edited by : Anand Singha)


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