Consequently, in 2022, India emerged as one of the fastest growing economies in the world, despite significant challenges in the global environment – including renewed disruptions of supply lines following the rise in geopolitical tensions, the synchronized tightening of global monetary policies, and inflationary pressures. The World Bank is partnering with the government in this effort by helping strengthen policies, institutions, and investments to create a better future for the country and its people through green, resilient, and inclusive development.Īfter real GDP contracted in FY20/21 due to the COVID-19 pandemic, growth bounced back strongly in FY21/22, supported by accommodative monetary and fiscal policies and wide vaccine coverage. At the same time, gaps in economic participation will need to be addressed, including by bringing more women into the workforce.

Growth-oriented reforms will need to be accompanied by an expansion in good jobs that keeps pace with the number of labor market entrants. India’s aspiration to achieve high income status by 2047 will need to be realized through a growth process that delivers broad based gains to the bottom half of the population. Headline employment indicators have improved since 2020 but concerns remain about the quality of jobs created and the real growth in wages. Child malnutrition has remained high, with 35.5 percent of children under the age of 5 years being stunted, with the figure rising to 67 percent for children in the 6-59 months age group. Inequality in consumption has remained persistent, with a Gini index of around 35 over the past two decades. Recent estimates suggest that extreme poverty increased due to the COVID-19 pandemic but moderated in 2021-22 as access to vaccines became widespread. In recent years, however, the pace of poverty reduction has slowed key welfare indicators have also been slow to improve. Between 20, the country is estimated to have halved the share of the population living in extreme poverty - below $2.15 per person per day (2017 PPP) (World Bank Poverty and Inequality Portal and Macro Poverty Outlook, Spring 2023).

Over the past two decades, India has made remarkable progress in reducing extreme poverty.

Rise of the middle kingdom