India's extreme poverty declined by a significant 12.3 percentage points between 2011 and 2019, according to a working paper released by the World Bank.
The document was uploaded in the public domain nearly a week after a working paper, released by the International Monetary Fund (IMF), claimed that the free foodgrain scheme capped extreme poverty in India at 0.86 percent in 2020.
The World Bank's research paper, co-authored by economists Sutirtha Sinha Roy and Roy van der Weide, said "rural and urban poverty dropped by 14.7 and 7.9 percentage points during 2011-2019".
The reduction was greater in rural areas as the poverty rate there stood at 26.3 percent in 2011, and dropped to 11.9 percent in 2019, the paper noted. Urban poverty, in the same period, dropped from 14.2 to 6.3 percent, it added.
The paper, titled 'Poverty in India Has Declined over the Last Decade But Not As Much As Previously Thought', clarified that it "does not necessarily represent the views of the World Bank" and the "findings, interpretations, and conclusions expressed in this paper are entirely those
of the authors".
The research claims that there were at least two instances between 2011 and 2019 when poverty marginally increased for a small duration. These short-term reversals were observed in the period around the Centre's demonetisation drive and the economic slowdown that had plagued the economy a year before the pandemic, the paper suggested.
"Urban poverty rose by 2 percentage point in 2016 (coinciding with the demonetisation event) and rural poverty rose by 10 basis points in 2019 (coinciding with a slowdown in the economy)," it stated.
The study also claimed that the real income of farmers with the smallest landholdings increased significantly as compared to those owning larger areas of land.
“Real incomes for farmers with the smallest landholdings have grown by 10 percent in annualized terms between the two survey rounds [2013 and 2019] compared to a 2 percent growth for farmers with the largest landholding,” it said.
The paper assumes significance as it "sheds light on how poverty and inequality have evolved since 2011", the authors said, adding that their data was sourced using a "new household panel survey, the Consumer Pyramids Household Survey conducted by a private data company".
"We observe a slight moderation in consumption inequality since 2011, but by a margin smaller than what is reported in the unreleased NSS-2017 survey. Finally, the extent of poverty reduction during 2015-2019 is estimated to be notably lower than earlier projections based on growth in private final consumption expenditure reported in national account statistics," they further noted.
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