World Bank Update: Threshold Poverty Line Raises to USD 3 per day

Current Context: The World Bank raised the International Poverty Line to USD 3 per day on June 7, 2025, up from the previous USD 2.15 per day (based on 2021 PPP calculations).

• Despite this higher threshold, India’s extreme poverty rate has dropped significantly to 5.3% in 2022–23, down from 27.1% in 2011–12.

Key Highlights:

• India lifted 171 million people out of extreme poverty over the past decade.
• Rural extreme poverty fell from 18.4% to 2.8%, while urban extreme poverty declined from 10.7% to 1.1%, narrowing the rural-urban gap.
• Free and subsidized food transfers played a crucial role in poverty reduction.
• Five most populous states account for 54% of the extremely poor.

Question:

Q.1 What was India’s extreme poverty rate in 2022–23 as per the updated threshold?
a) 10.2%
b) 5.3%
c) 18.4%
d) 27.1%

Answer: b) India’s extreme poverty rate fell to 5.3% in 2022–23, showing significant progress compared to earlier years, even after applying the updated higher poverty line.