World Bank: India's Extreme Poverty Falls to 2.6% in 2023, Inequality Index Drops to 23.0
The World Bank's India Poverty and Equity Brief: October 2026 says India recorded one of the fastest declines in poverty in the world.
India's extreme poverty rate fell from 27.1% in 2011 to 2.6% in 2023, a fall of about 90%. In simple terms, it went from more than one in four Indians to roughly one in 38.
The estimates use the World Bank's extreme poverty line of $3 per person per day and its lower-middle-income poverty line of $4.20 per day, both measured in 2021 purchasing power parity (PPP) dollars.
As cited from the report, about 49.6 crore people moved out of poverty between 2011 and 2023, and employment grew by 13.4 crore in six years, nearly twice the increase in India's working-age population.
India's Gini index (the main measure of inequality) fell by over 20% to 23.0. The report notes progress on both money-based (monetary) and non-money (non-monetary) measures of poverty over the past decade.
Poverty Measurement in India: Methods and Debates
Poverty measurement means deciding who counts as poor and how many such people there are. The classic method uses a poverty line: a fixed amount of money a person needs each day or month to meet basic needs. Anyone whose spending falls below this line is counted as poor. India measures spending (consumption), not income, because spending is easier to record and steadier across the year for farm and informal workers.
The new October 2026 brief uses the $3 and $4.20 lines at 2021 PPP and puts India's extreme poverty at 2.6% in 2023. Because India has no current official poverty line, such international estimates have become the main reference point in debates about how fast poverty is falling.
Purchasing Power Parity (PPP): Nominal GDP vs PPP Rankings
Purchasing power parity (PPP) is a way of comparing money across countries after adjusting for the fact that the same money buys different amounts in different places. For example, a haircut or a plate of food costs far less in India than in the US when converted at the normal exchange rate. A "PPP dollar" (also called an international dollar) is the amount of local money needed to buy what one US dollar buys in the US. This is why the World Bank's poverty lines are set in PPP dollars, not in market-rate dollars.
The 27.1% and 2.6% figures are measured with the $3-a-day line at 2021 PPP. Without PPP, comparing an Indian household's spending with a global poverty line would greatly overstate poverty, because prices in India are much lower than in rich countries.
Gini Coefficient: How Economists Measure Inequality
The Gini coefficient is a single number that shows how unequally income, spending or wealth is shared among the people of a country. It runs from 0 to 1, or from 0 to 100 when written as an index. 0 means perfect equality (everyone has the same), and 100 means perfect inequality (one person has everything). A lower number therefore means a more equal society.
The October 2026 brief reports India's Gini index at 23.0, more than 20% lower than in 2011. The fall points to spending gains for poorer households, though experts caution that a consumption-based Gini tells only part of the inequality story.
- Report: World Bank, India Poverty and Equity Brief: October 2026
- Extreme poverty rate: 27.1% (2011) to 2.6% (2023), a fall of about 90%
- Poverty lines used: $3.00/day (extreme) and $4.20/day (lower-middle-income), at 2021 PPP
- About 49.6 crore people moved out of poverty, 2011–2023 (as cited from the report)
- Employment grew by 13.4 crore in six years
- Gini index: 23.0, down over 20%
- International Poverty Line revised in June 2025: $2.15 (2017 PPP) to $3.00 (2021 PPP)
- Tendulkar poverty ratio 2011-12: 21.9%; Rangarajan: 29.5%