World Bank Poverty Line Changes: How Many Indians Are ’Extremely Poor’ Under New Standards?

The World Bank  has revised its poverty line standards, introducing new benchmark that significantly impact how we measure extreme poverty globally. Under the update criteria individuals spending less than $3 per day (approximately ₹257) are now classified as living Below the extreme poverty line.

India’s Remarkable Progress in Poverty Reduction

When viewed through India’s lens, these new standards reveal a dramatic transformation in the country’s poverty landscape between 2011-12 and 2022-23. According to a report by The Indian Express the percentage of Indians living in extreme poverty has dropped to just 2.3% of the total populations in 2022-23, compared to over 27% in 2011-12.

This represents a stunning reduction in absolute numbers while 344 million Indians were classified as extremely poor in 2011-12, this figure has plummeted to 75 million in 2022-23 under the World Bank’s new assessment framework.

Impact of Previous Poverty Line Standards 

The World Bank’s analysis also examined poverty rates using the previous benchmark of $2.15 (₹181.88) per day. Under this older standard, 16.2% of India’s population was considered extremely poor in 2011-12 a figure that decreased to just 2.3% by 2022. In real terms, this translates to a reduction from 206 million people to merely 34 million people living in extreme poverty.

Revised Lower Middle-Class Income Thresholds

Beyond extreme poverty measures, the World Bank has also updated its Lower-Middle Income Country (LMIC) poverty line, raising it from  $3.65 (₹313.14) to $4.20 (₹360.33) per day. This adjustments reveals another significant improvement in India’s economic landscape.

Under this revised Lower-Middle Income Country (LMIC) threshold the percentage of Indians falling below this line decreased from 57.7% in 2011-12 to in 2022-23. This represents a reduction from 732 million people to 342 million people.