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PUSHED BACK

India contributed to nearly 60% of the global rise in poverty in 2020

A child labourer carries bricks in Bihar-e-Sharif town, about 60 km (37 miles) from Patna.
REUTERS/Adeel Halim
Carrying the burden.
  • Manavi Kapur
By Manavi Kapur

Culture and lifestyle reporter

A global economic slowdown has shrunk the world’s middle-class population and impoverished millions.

In 2020, an estimated 131 million people were pushed into poverty and low-income groups, according to new research by Pew Research Center, a US think tank based in Washington. A majority of upper middle- and middle-income people (earning between $10 and $50 a day) became low-income (daily wage of $2-$10) and poor (earning less than $2 a day).

A large driver of this rising poverty appears to be the South Asian region, which “is estimated to have added nearly double the amount of people to the ranks of the globally poor as sub-Saharan Africa in the pandemic,” Pew’s research found. “The percentage increase in poverty in South Asia (75%) dwarfs the increase in sub-Saharan Africa (8%).”

The projected economic recession and its impact on a region’s GDP appear to correlate to how steeply a region’s gross domestic product (GDP) fell. “The relatively outsized role of South Asia in the contraction of the global middle class and the expansion of poverty is the result of it seeing the sharpest reduction in economic growth in the pandemic,” Pew added.

India seems to be the worst-hit country in South Asia, both in terms of contracting GDP and the sharp rise in the number of its poor.

India and China’s shrinking middle classes

India added 75 million people to poverty, accounting for 60% of the rise in poor populations globally. By contrast, China added 1 million to its poor population.

Compared to pre-pandemic estimates, too, India seems to have performed worse on income parameters than was expected. For instance, India was projected to have a middle-class population of 99 million by 2020. By Pew’s estimates, that number now stands at 66 million, cut by a third.

Added to that, the number of poor were expected to be at 59 million, and now stand at 134 million according to this research. This significantly reverses the momentum India had achieved in eradicating poverty over the past decade. “The projected rise in poverty in 2020 when comparing pre-pandemic and revised figures—75 million—claws back several years of progress on this front for India,” Pew noted.

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