Poverty in India facts for kids

Street children in India selling snacks and drinks to bus passengers

Poverty in India is a big challenge for the country. Many people in India live in poverty, meaning they do not have enough money for basic needs like food, shelter, and clothing. The Indian government has set a "poverty line," which is a certain amount of money people need each month to not be considered poor. For people in rural areas, this amount is around 670 rupees per month, and for those in cities, it's about 860 rupees. This shows that many families struggle to make ends meet.

In 2012, a report found that about 26% of all people in India lived on less than US$1.25 (about a dollar and a quarter) per day. This is a common way to measure poverty around the world. However, over the past ten years, the number of people living in poverty has been going down. More recently, a World Bank report from 2025 showed that extreme poverty in India fell from 16.2% in 2011-12 to just 2.3% in 2022-23. This means 378 million people were lifted from poverty. This success is due to both economic growth and government programs that help people with food and money.

Understanding Poverty in India

Poverty is a complex issue, and there are different ideas about why it exists in India. Understanding these ideas helps us see the problem from various angles.

What Causes Poverty?

There are two main ways people think about the causes of poverty in India.

Historical Reasons

One idea is that India's poverty comes from its past. For a long time, India was ruled by other countries, especially the British. During this time, India's resources were often used to benefit the ruling country, which made it harder for India to develop its own economy and industries. This historical exploitation is seen by some as a major reason why poverty became so widespread.

Modern Challenges

Another way of looking at it focuses on more recent issues. These challenges include:

• Not Enough Jobs: Many people cannot find steady jobs, or the jobs they find do not pay enough. This means they struggle to earn a living.
• Lack of Property: Some people do not own land or homes, which can make it hard to build wealth or have a secure place to live.
• Farming Dependence: A large number of people in India rely on farming. If crops fail due to weather or if prices for farm products are low, farmers and their families can become very poor.
• Population Growth: India has a very large and growing population. Sometimes, there are not enough resources or jobs for everyone, which can add to poverty.
• Social Divisions: In some parts of India, old social systems, like the caste system, have created inequalities. These divisions can make it harder for certain groups of people to get good education, jobs, or opportunities, trapping them in poverty.
• Corruption: When people in power use their positions for personal gain instead of helping the public, it can lead to money and resources not reaching those who need them most. This can make poverty worse.

Poverty by State (2012)

In 2012, the Reserve Bank of India reported on poverty levels across different states. Goa had the lowest poverty rate at 5.09%, while the national average was 21.92%. The table below shows the percentage of people living below the poverty line in each state and union territory.

Efforts to Reduce Poverty

Since the 1950s, the Indian government and many organizations have launched programs to reduce poverty. These efforts include providing subsidized food, offering loans, improving farming methods, and supporting education and family planning. These steps have helped prevent major food shortages and reduced illiteracy and malnutrition.

India's economy has grown steadily over the past two decades. This growth has helped many people, but it has not been even across all groups or regions. Some states have grown faster than others.

The World Bank's Global Monitoring Report for 2014–15 stated that India was the biggest contributor to poverty reduction between 2008 and 2011. Around 140 million people were lifted out of extreme poverty during this time.

India's fast economic growth since 1991 is a key reason for the big drop in poverty. Government programs like the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) and the Midday Meal Scheme in schools have also played a role. MGNREGA helps reduce poverty in rural areas and during certain seasons.

A United Nations report from 2023 confirmed India's significant progress. It noted that India lifted about 415 million people out of poverty between 2005-2006 and 2019-2021. The report also highlighted improvements in health and education for children and disadvantaged groups.

The World Bank's Spring 2025 Poverty and Equity Brief reported that about 171 million people in India moved out of extreme poverty between 2011 and 2023. This was due to economic growth and government programs. These programs included expanding bank accounts, using digital IDs for welfare, providing health insurance, and ensuring food security for millions.

Images for kids

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  Share of population in extreme poverty, 1981 to 2017

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  Slums near the international airport in Mumbai/Bombay

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  India Poverty rate since 1993 based on World Bank $2.00 ppp value