India is one of the world’s fastest growing major economy. According to International Monetary Fund (IMF), at the growth rate of 11.5%, India is going to be the fastest growing economy in 2021. The world’s only country to register a double-digit growth in 2021.
But the sudden outbreak of the novel coronavirus in early 2020 pushed many into poverty in India. It is estimated that 150-199 million additional people will fall into poverty at the end of 2021. Due to the pandemic, there were job cuts on a large-scale. The poverty rate of India is set to rise. According to the CMIE report, around 7 million jobs were lost in a year. The consumption expenditure has come down and the public spending on development was sluggish. So, poverty in India is expected to rise in the coming days.
Niti Aayog’s First Multidimensional Poverty Index (MPI) Report 2021
According to Niti Aayog’s first Multidimensional Poverty Index (MPI) report released in November 2021, Kerala has turn out to be the state with the lowest rate of poverty in India. As per the index, only 0.71 per cent population of Kerala is poor. Kottayam of Kerala is the only district in India without poverty. This district has registered a zero in the recently released poverty index.
States like Bihar, Jharkhand and Uttar Pradesh have registered the highest poverty rate across India. These states have emerged as the ‘poorest states’ in India. 51.91% of the population in Bihar classified as poor, followed by Jharkhand (42.16%) and Uttar Pradesh (37.79%).
India’s first-ever national MPI measure is based on utilizing 12 key indicators like nutrition, child and adolescent mortality, antenatal care, years of schooling, school attendance etc. which cover areas such as health and nutrition, education and standard of living.
Poverty in India
India is no longer the country with the most extreme poverty, states the Brookings report. In the global poverty ranking, India is sliding down. As per the real-time data from World Poverty Clock, 7% of the Indian population are living in extreme poverty and 0.6 Indians are escaping extreme poverty every minute.
Indian government’s spending on rural welfare schemes was helping in a big way to reduce national poverty. By 2030, the target of government is to eradicate extreme poverty for all people everywhere, currently measured as people living on less than $1.25 a day.
India Poverty Statistics 2021
|People living in extreme poverty||97,697,747|
According to World Poverty Clock, the number of people who are living in poverty is 97,697,747 (97.7 million) or roughly 6% of the population. There are 44,806,455 males and 52,891,292 females impacted by poverty in India. Females are more affected than males.
Poverty in India – Age Groups
|Age Groups||No. of People|
The age group from 0-19 are the most affected by extreme poverty. This can lead the youngsters to malnutrition and illiteracy. We can see a decreasing trend after the age of 40.
Prosperous State of India
Below are the Indian states with Low Poverty.
- Tamil Nadu
Kerala has the lowest rate of poverty in India, with only 0.71% of the population classified poor. Kerala is followed by states like Goa (3.76%), Sikkim (3.82%), Tamil Nadu (4.89%) and Punjab (5.59%).
Poorest State of India
- Uttar Pradesh
- Madhya Pradesh
As per NITI Aayog Multidimensional Poverty Index report, the states like Bihar, Jharkhand, Uttar Pradesh, Madhya Pradesh and Meghalaya have turn out to be the ‘poorest states’ in India. 51.91% of the population in Bihar classified as poor, followed by Jharkhand (42.16%), Uttar Pradesh (37.79%), Madhya Pradesh (36.65%) and both Meghalaya & Assam (32.67%)
Poverty in India State wise
|Area||Population living below National Poverty line (%)|
|Andaman & Nicobar Islands||4.30|
|Dadra and Nagar Haveli||27.36|
|Daman and Diu||6.82|
|Jammu & Kashmir and Ladakh||12.58|
Measuring Poverty in India
Global Multidimensional Poverty Index – India
The Global Multidimensional Poverty Index was launched in 2010 by the United Nations Development Program (UNDP) and the Oxford Poverty and Human Development Initiative (OPHI). Each year, it measures the complexities of poor people’s lives, individually and collectively and focuses how the multidimensional poverty has declined. India is among the four countries to have halved their MPI value. During the period from 2006 to 2016, India had the biggest reduction in the number of multidimensionally poor people. 273 million of them moved out of this poverty in over 10 years time.
The MPI is a measure of multidimensional poverty covering more than 100 developing countries. It tracks deprivation across three dimensions and 10 indicators as indicted below:
- Education, where years of schooling and child enrolment comes into effect (1/6 weightage each, total 2/6);
- Health, the child mortality and nutrition comes into this (1/6 weightage each, total 2/6);
- Standard of living, includes electricity, flooring, drinking water, sanitation, cooking fuel and assets
Global MPI 2020 Report indicates that India is 62nd among 107 countries with an MPI score of 0.123 and 27.9% population identified as multi-dimensionally poor, the number was 36.8% for rural and 9.2% for urban India. There were wide variations across states.
Poverty Line in India
Official Release of Poverty Line Estimates
The Planning Commission used to release the estimates of poverty as number of persons below poverty line as a percentage of Indian population. This was followed for the years 1973-74, 1977-78, 1983, 1987-88, 1993-94, 1999-2000, 2004- 05, 2009-10 and 2011-12.
For 2011-12, the Planning Commission released poverty data in July 2013, based on the Tendulkar poverty line.
Poverty Percentage in India
- According to Global MPI Reports 2019 and 2020, 21.9% of the population was poor in the country or the number of poor was pegged at 269.8 million
- According to World Poverty Clock in 2021, roughly 6% or 86,799,498 (86.8 million) of the population are living in poverty.
World Bank Poverty Line
The World Bank Poverty Line defines extreme poverty as living on less than $1.90 a day, measured in 2011 purchasing power parity prices.
As an alternative way of measuring the poverty of people, World Bank developed the ‘poverty gap index’ that measures the intensity of poverty, by calculating the amount of money required by a household in order to reach the poverty line. That means, it calculates the income or consumption shortfall from the poverty line.
International Poverty Line
According to the World Bank collection of development indicators, the Poverty gap for India is reported at 4.3% in 2011 down from 20% in 1977.
World Poverty Clock (WPC)
World Poverty Clock is a systematic analytical framework to measure progress towards SDGs by World Data Lab. It is a global model that tracks real-time poverty estimates until 2030 for every country in the world. Here publicly available data on income distribution, production and consumption are used and they bridge the common decade gaps between large-scale surveys and censuses.
The percentage of the world’s population living below the extreme poverty line has reduced from 36% to 10% in 2015 for the last quarter century according to World Poverty Clock. That means a reduction from about 1.9 billion people living in extreme poverty to about 736 million in 2015.
Causes of Poverty in India
Main Causes of Poverty in India
After the independence, the Indian government initiated many welfare schemes like subsidizing food through ration cards, increased access to loans, promoting education, improving agricultural methods and family planning. These measures helped greatly to eradicate poverty by eliminating famines, malnutrition, illiteracy and unemployment.
A record decline in poverty by more than half is only since 1991 after India’s rapid economic growth.
Ministry of Rural Development’s programmes like MNREGA, NRLM, PMAY, DDUGKY focused on alleviating the poverty of Indian households.
India’s dominant economic growth over the last 30 years continued to pull millions of people out of poverty. Obviously, due to the unexpected impact of COVID-19, India will also be experiencing a likely spike in its poverty rate. Moving forward, the elimination of poverty in India over the next decade is within reach in spite of challenges ahead.
(Source: Global Multidimensional Poverty Index (MPI)- UNDP,
International Monetary Fund,
World Poverty Clock,
Niti Aayog’s SDG India Index)
Disclaimer: The data research report we present here is based on information found from various sources on the internet. We are not liable for any financial loss, errors, or damages of any kind that may result from the use of the information herein. We acknowledge that though we try to report accurately, we cannot verify the absolute facts of everything that has been represented.