Rural poverty falls faster than Urban: SBI Research

Poverty in rural areas declined to less than 5% for the first time and outpaced the reduction in urban areas, driven by higher consumption growth among the bottom 0-5% decile, supported by government initiatives, according to an analysis by SBI Research.

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Rural poverty fell to 4.86% in 2023-24 from 7.2% in 2022-23 and 25.7% in 2011-12. In contrast, urban poverty fell to 4.09% in 2023-24 from 4.6% in the previous year and 13.7% in 2011-12, the report said on Friday.

Overall, the poverty rate in India now stands in the range of 4-4.5%, with “almost minimal existence of extreme poverty”, it added.

However, the report mentioned that these numbers could undergo revisions once the 2021 census is completed and updated rural urban population data is available.

Urban-rural consumption gap has also narrowed. The gap declined to 69.7% in 2023-24 from 71.2% in the year before. It was 83.9% in 2011-12.

Government initiatives such as direct benefit transfer (DBT), investments in rural infrastructure and boosting farmer’s income contributed to this trend, SBI Research said.

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