India's Poverty Decline Is Among The Fastest, But Its Top 10% Workers Earn 13x More Than The Bottom 10%

India has recorded one of the world's fastest declines in poverty over the past decade, lifting an estimated 496 million people out of poverty between 2011 and 2023. However, significant income disparities remain, with median earnings among the country's top 10% of workers standing at about 13 times those of the bottom 10%, according to the World Bank's October 2026 India Poverty and Equity Brief.

The report highlights the country's progress in reducing both monetary and multidimensional poverty, while pointing to persistent challenges in employment quality, wage growth and access to economic opportunities.

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The share of India's population living below the lower-middle-income poverty line of $4.20 a day, measured at 2021 purchasing power parity (PPP), dropped to 16.1% in 2023 from 57.7% in 2011. Extreme poverty, measured using the $3-a-day threshold, declined to 2.6% from 27.1% over the same period.

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Multidimensional poverty also fell considerably. According to the Oxford Poverty and Human Development Initiative's Multidimensional Poverty Index, the poverty rate declined from 53.8% in 2005-06 to 16.4% in 2019-21. The World Bank's multidimensional poverty measure stood at 15.5% in 2022-23.

The World Bank attributed the gains to strong consumption growth, rising employment, particularly among women, and expanded social transfers, including food subsidies.

Despite the progress, poverty remains concentrated among households with lower educational attainment, fewer assets, limited access to stable employment and higher dependency ratios.

Rural poverty stood at 19.3% in 2023, compared with 8.6% in urban areas, using the $4.20-a-day threshold. While rural households have experienced substantial welfare gains, limited access to productive, higher-quality non-farm jobs continues to constrain incomes.

Geographically, states across a contiguous belt stretching from Uttar Pradesh to West Bengal accounted for about 57% of India's poor population, the report said. Further poverty reduction will depend increasingly on expanding productive employment in these regions.

India added around 134 million employed people between 2017 and 2023, nearly twice the increase in the working-age population. Much of this growth came from rural women entering paid work, increasing the number of earners in households.

However, the World Bank noted that real earnings remained broadly unchanged, with employment growth concentrated in relatively low-productivity activities. Youth unemployment also increased from 14.6% to 15.9% between the first quarters of FY26 and FY27, particularly among rural young women.

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The poverty rate at the $4.20-a-day threshold is projected to decline further, from 14.2% in 2026 to 12.1% by 2028, according to the report's indicative projections.

The World Bank cautioned that these estimates may change as new labour market and macroeconomic data become available. It also noted that recent survey improvements may account for part of the measured welfare gains and that inequality could be understated because wealthier households may not be fully captured.

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