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Main Article: Poverty alleviation programmes in India

Reduction in poverty in India
Since the 1950s, the Indian government and non-governmental organisations have initiated several programs to alleviate poverty, including subsidising food and other necessities, increased access to loans, improving agricultural techniques and price supports, promoting education, and family planning. These measures have helped eliminate famines, cut absolute poverty levels by more than half, and reduced illiteracy and malnutrition.

Although the Indian economy has grown steadily over the last two decades, its growth has been uneven when comparing social groups, economic groups, geographic regions, and rural and urban areas. For the year 2015–16, the GSDP growth rates of Andhra Pradesh, Bihar and Madhya Pradesh was higher than Maharashtra, Odisha or Punjab. Though GDP growth rate matters a lot economically, the debate is moving towards another consensus in India, where unhealthy infatuation with GDP growth matters less and holistic development or all-inclusive growth matters more. While India may well be on the path to eradicating extreme poverty, it still lags well behind in other important development indicators, even in comparison to some of its neighbouring countries, especially in regard to health and education.

Despite significant economic progress, one quarter of the nation's population earns less than the government-specified poverty threshold of ₹32 per day (approximately US$ 0.6).

According to the 2001 census, 35.5% of Indian households used banking services, 35.1% owned a radio or transistor, 31.6% a television, 9.1% a phone, 43.7% a bicycle, 11.7% a scooter, motorcycle or a moped, and 2.5% a car, jeep or van; 34.5% of the households had none of these assets. According to Department of Telecommunications of India, the phone density reached 73.34% by December 2012 and as an annual growth decreased by −4.58%. This tallies with the fact that a family of four with an annual income of ₹137,000 (US$1,900) could afford some of these luxury items.

The World Bank's Global Monitoring Report for 2014–15 on the Millennium Development Goals says India has been the biggest contributor to poverty reduction between 2008 and 2011, with around 140 million or so lifted out of absolute poverty. Since the early 1950s, the Indian government has initiated various schemes to help the poor attain self-sufficiency in food production. A few examples of these initiatives include ration cards and price controls over the supply of basic commodities, particularly food at controlled prices, available throughout the country. These efforts prevented famines, but did little to eliminate or reduce poverty in rural or urban areas between 1950 and 1980.

India's rapid economic growth rate since 1991 is one of the main reasons for a record decline in poverty. Another reason proposed is India's launch of social welfare programs such as the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) and the Midday Meal Scheme in government schools. In a 2012 study, Klonner and Oldiges, concluded that MGNREGA helps reduce rural poverty gap (intensity of rural poverty) and seasonal poverty, but not overall poverty. However, there is a disturbing side, as deprivation has tended to increase, and that too among the most deprived sections. According to the latest statistics published by the Census of India, among scheduled tribes, 44.7% of people were farmers working on their own land in 2001; however, this number came down to 34.5% in 2011. Among scheduled castes, this number declined from 20% to 14.8% during the same period. This data is corroborated by other data from the census, which also says that the number of people who were working on others' land (landless laborers), increased from 36.9% in 2001 to 44.4% among scheduled castes SC and from 45.6% to 45.9% among scheduled tribes.

India has achieved annual growth exceeding 7 percent over the last 15 years and continues to pull millions of people out of poverty, according to the World Bank. The country has halved its poverty rate over the past three decades and has seen strong improvements in most human development outcomes, a report by the international financial institution has found. Growth is expected to continue and the elimination of extreme poverty in the next decade is within reach, said the bank, which warned that the country's development trajectory faces considerable challenges.

India has sustained strong economic growth at over 5% on average during every five-year plan since the 1980s.1 Although the growth in India’s Gross National Income has been much higher than her neighbors, Drèze and Sen, 2011, Drèze and Sen, 2013 powerfully demonstrate that progress in key social indicators has been slower. Thus understanding progress only in terms of economic growth is not sufficient. Distinct measures are required to ascertain whether rising national income translates into social gains and poverty reduction. In an old but formative debate, some scholars argued that the agricultural growth process stimulated by the green revolution brought little or no gain to the rural poor, while others pointed to farm-output growth as the key to rural poverty reduction. Datt and Ravallion (1998a) find that higher farm productivity (output per unit area) brought both absolute and relative gains to India’s rural poor, with a large share of the gains coming through higher real wages with higher farm productivity.