Extreme poverty has gone away in India, claims American think tank The Brookings Institution

Economists Surjit Bhalla and Karan Bhasin of the American think tank The Brookings Institution said in an article that India has eliminated extreme poverty. For this, he cited the recently released consumption expenditure data of 2022-23.

Citing data in the article, both the renowned economists said that real per capita consumption has increased by 2.9 percent per year since 2011-12. During this period, rural growth was 3.1 percent and urban growth was 2.6 percent. The article said that during this period there has also been an unprecedented decline in urban and rural inequality. Urban Gini declined from 36.7 to 31.9, while Rural Gini declined from 28.7 to 27.0.

High growth and big decline in inequality
The Gini index reflects the inequality of income distribution. If it is zero then it means that there is complete equality in the society. The article states that this decline is unprecedented in the history of inequality analysis. The article says that high growth and a huge decline in inequality have together eliminated poverty in India.

Big decline in headcount poverty ratio
Headcount Poverty Ratio (HCR) reduced from 12.2 percent in 2011-12 to 2 percent in 2022-23. Rural poverty was 2.5 percent, while urban poverty came down to 1 percent. The authors said that these estimates do not take into account the free food (wheat and rice) provided by the government to about two-thirds of the population and public health and education. The article says that the decline in HCR is notable because in the past it took 30 years for India to reduce poverty levels by this much, whereas this time it has been achieved in 11 years.

Eliminate extreme poverty as generally defined in the country
Economists said, “Official data confirms that India has eliminated extreme poverty as commonly defined in international comparisons.”