The Current Global and Indian Poverty Landscape: Trends and Challenges

Poverty is one of the most studied yet stubbornly persistent challenges of our time. While the share of people living in extreme deprivation has dropped sharply since 1990, the gains have not been evenly distributed across countries or regions. The way poverty is measured also shapes how we see it. A line drawn at one income level tells a very different story than a line drawn at another, and a calorie-based threshold misses the realities of housing, sanitation, and schooling. Understanding the current poverty situation, therefore, means looking at trends, measurement debates, and the moral and practical arguments for acting on them.

The global picture: progress, but uneven
Trends between 1990 and 2005
Why Sub-Saharan Africa lags behind
Where the world stands now
The Indian poverty context
From Tendulkar to Rangarajan: the measurement debate
National line versus international benchmarks
Challenges in measuring poverty accurately
Why reduce poverty? The ethical and self-interest case
The ethical argument
The self-interest argument
Bridging the two
Where the conversation is heading

The global picture: progress, but uneven

The last three decades have witnessed one of the most dramatic declines in extreme poverty in human history. In 1990, around 65% of people in East Asia and the Pacific and 55% of those in Sub-Saharan Africa lived on less than what today corresponds to $2.15 per day. By 2015, the global extreme poverty rate had fallen to roughly 10%, lifting more than a billion people out of extreme poverty between 1990 and 2015.

However, this progress masks sharp regional disparities. East Asia and the Pacific, led by China, saw the fastest decline, while South Asia, particularly India, followed with strong gains in the 2000s. Sub-Saharan Africa, by contrast, has been left behind.

Trends between 1990 and 2005

Between 1990 and 2005, the most dramatic improvements were concentrated in Asia. Rapid industrialisation in China, export-led growth in Southeast Asia, and rising agricultural productivity in South Asia together pulled hundreds of millions above the poverty line. Latin America saw slower but steady progress, while in Sub-Saharan Africa, a sharp drop occurred mainly in the early 1990s before the pace of poverty reduction stalled or continued to decline very slowly after 1995.

The post-2005 period continued this story. While China and India kept reducing poverty headcounts, sub-Saharan Africa’s share of the world’s poor grew. In 1990, 14% of the world’s poor lived in Africa; by 2019, 57% of the world’s poorest lived in Sub-Saharan Africa.

Why Sub-Saharan Africa lags behind

The reasons are layered. Population growth has outpaced poverty reduction, so even though the percentage rate falls, the absolute number of poor keeps climbing. While the regional poverty rate fell from 56% in 1990 to 40% in 2018, the number of poor rose from 284 million in 1990 to an estimated 433 million in 2018.

Conflict and fragility play a major role. Countries facing fragility, conflict, and violence in the region recorded extreme poverty rates close to twice those of more stable economies. Add weak infrastructure, limited industrial diversification, climate vulnerability, and the impact of the COVID-19 shock, and Africa’s slower trajectory becomes easier to understand.

Where the world stands now

Recent estimates show that progress has slowed sharply since the pandemic. As of 2024, around 847 million people are estimated to live in extreme poverty, with the global rate projected to decline only marginally from 10.4% in 2024 to 10.0% by 2026. The World Bank’s target of reducing extreme poverty to 3% or less by 2030 now appears out of reach, with projections suggesting 9% of the world will still be in extreme poverty by then. The 2020s are increasingly being described as a “lost decade” for poverty reduction.

The Indian poverty context

India’s poverty story is both a success and a puzzle. As one of the largest contributors to global poverty reduction, it has lifted hundreds of millions out of deprivation since the early 1990s. Yet measuring exactly how many remain poor is a contested exercise.

From Tendulkar to Rangarajan: the measurement debate

India does not yet have an official poverty estimate after 2011-12. The last accepted figures came from the Tendulkar Committee methodology, which moved away from a strict calorie-based norm and used a uniform all-India poverty line basket. It estimated the 2011-12 poverty line at Rs 816 per capita per month in rural areas and Rs 1,000 in urban areas. Under this method, about 21.9% of Indians were poor in 2011-12.

This figure triggered enormous public debate. Activists argued that the equivalent daily consumption was simply too low to sustain a dignified life. The government then constituted another expert group under C. Rangarajan. The Rangarajan Committee estimated the poverty line at Rs 1,407 per month in urban areas and Rs 972 in rural areas, which were 41% and 19% higher respectively than the Tendulkar lines. Under this revised method, 29.5% of the population was below the poverty line in 2011-12, or about 363 million people.

Neither figure was formally adopted as the country’s official line after that point. Since then, researchers have used updated household consumption data to project estimates. Updated Tendulkar-based estimates for 2022-23 place the all-India poverty incidence at around 21.9%, with rural poverty at 25.7% and urban poverty at 13.7%, but other researchers using the Rangarajan approach arrive at significantly higher figures.

National line versus international benchmarks

Comparing India’s national poverty line with international ones reveals a measurement gap. The World Bank’s extreme poverty line of $2.15 per day in 2017 purchasing power parity translates very differently from India’s rupee-based, consumption-survey-driven line. Recent World Bank revisions, using improved measurement of Indian consumption, estimated extreme poverty in India falling from 16.2% in 2011-12 to 2.3% in 2022-23.

This sharp drop reflects methodological changes in how India captured household consumption, not necessarily a near-elimination of hardship. Many households just above the extreme poverty line remain vulnerable to shocks like illness, job loss, or crop failure. International lines also vary by purpose: $2.15 a day captures the floor of survival, while $3.65 and $6.85 lines apply to lower-middle and upper-middle income contexts.

Challenges in measuring poverty accurately

Several challenges complicate poverty measurement in India. Outdated baskets: consumption patterns have shifted, with rising spending on health, education, and mobile communication that older baskets did not anticipate. Survey discontinuities: changes in the National Sample Survey methodology between rounds make long-term comparisons hard. Recall period differences: the Rangarajan Committee used a Modified Mixed Reference Period, capturing different recall windows for different goods, while earlier methods used uniform or mixed periods, yielding different numbers from the same households.

Beyond income, the country has also embraced multidimensional measurement. NITI Aayog’s National Multidimensional Poverty Index, based on NFHS-5 (2019-21), found that around 13.5 crore people exited multidimensional poverty between 2015-16 and 2019-21, with the headcount falling from 24.85% to 14.96%. This index looks at deprivations in health, education, and standard of living rather than just income, offering a richer view of well-being.

Why reduce poverty? The ethical and self-interest case

The case for poverty reduction is often discussed in moral terms, but there are also strong pragmatic and self-interest arguments. Both perspectives matter for shaping public support and policy commitment.

The ethical argument

At its core, the ethical case rests on the idea of human dignity. Poverty is not just a lack of income; it is also the denial of basic capabilities: nutrition, health, education, voice, and safety. From this view, allowing poverty to persist in a world of unprecedented wealth represents a collective moral failure.

Religious, philosophical, and political traditions across cultures converge on this point. The Sustainable Development Goals, signed by 193 nations, place ending poverty in all its forms at the top of the global agenda. Treating poverty as a violation of rights rather than a condition to be tolerated changes the entire framing: it makes action a duty rather than charity.

The self-interest argument

Even if one is unmoved by moral arguments, there are strong self-interested reasons for societies to reduce poverty. Widespread poverty undermines economic growth by limiting domestic demand, depressing human capital formation, and trapping a country in low-productivity sectors. Poor health and undernutrition among the poor reduce overall workforce productivity.

High poverty also generates social and political instability. Inequality has been linked with crime, conflict, and erosion of trust in institutions. Disease outbreaks, environmental degradation, and migration pressures rarely stay confined to poor neighbourhoods or poor countries. The COVID-19 pandemic showed how quickly a health shock among the most vulnerable can ripple into a global economic crisis.

For countries like India, where the demographic dividend depends on a young, educated, and healthy workforce, reducing poverty is also an economic strategy. Every rupee invested in nutrition, schooling, and basic services translates into future productivity and tax revenue.

Bridging the two

Ethical and self-interested arguments are not opposed. They are often complementary, and the strongest political coalitions for poverty reduction tend to combine both. A welfare state can be justified as both a moral commitment and an investment. Universal basic services like health insurance, school meals, and clean water draw legitimacy from rights-based language while delivering measurable economic returns.

Where the conversation is heading

The future of poverty measurement and reduction is moving towards three directions. First, multidimensional indices will increasingly complement money-metric lines, capturing the lived reality of deprivation. Second, finer geographic and demographic disaggregation will reveal pockets of persistent poverty that national averages hide, especially among tribal populations, female-headed households, and informal workers. Third, climate vulnerability is becoming central, as floods, droughts, and heat waves push people into and trap them in poverty.

India’s progress in reducing multidimensional poverty has been notable, yet the absence of a new official income-based poverty line for over a decade is a gap that researchers and policymakers will need to address. Globally, the slowing pace of progress and the concentration of extreme poverty in conflict-affected and African countries means that the world is unlikely to meet the 2030 target without renewed commitment.

What do you think? Should India focus more on multidimensional indicators like health, education, and sanitation rather than on a single rupee-based poverty line, given how consumption patterns have evolved? And do you find the ethical argument or the self-interest argument more persuasive for prioritising poverty reduction in public policy?

References

PDF 📄

The Current Global and Indian Poverty Landscape: Trends and Challenges

Table of Contents

The global picture: progress, but uneven 🔗

Trends between 1990 and 2005 🔗

Why Sub-Saharan Africa lags behind 🔗

Where the world stands now 🔗

The Indian poverty context 🔗

From Tendulkar to Rangarajan: the measurement debate 🔗

National line versus international benchmarks 🔗

Challenges in measuring poverty accurately 🔗

Why reduce poverty? The ethical and self-interest case 🔗

The ethical argument 🔗

The self-interest argument 🔗

Bridging the two 🔗

Where the conversation is heading 🔗