Covid-19 could push 12 million Indians into extreme poverty: World Bank
The World Bank estimates that “more people living close to the international poverty line the developing world in low and middle income countries will suffer the greatest consequences in terms of extreme poverty”.
The Covid-19 pandemic could push 49 million people, including 12 million Indians, across the world into extreme poverty, estimates a projection by researchers from the Development Data Group of the World Bank. Extreme poverty is defined as living on less than $1.90 a day.
The data blog published by the World Bank which contains these worrying figures says that the majority of these people - about 23 million - are projected to be in Sub-Saharan Africa and 16 million in South Asia. It forecasts that the global share of world population under extreme poverty “is projected to increase from 8.2 per cent in 2019 to 8.6 per cent in 2020, or from 632 million people to 665 million people”.
The earlier World Economic Outlook from the International Monetary Fund (IMF) had forecast a decline in global population living in poverty from 8.1 per cent to 7.8 per cent in 2020, but this was before the global outbreak of Covid-19. The IMF now estimates advanced economies to contract by around 6 per cent in 2020, while emerging markets and developing economies are expected to contract by 1 per cent.
The World Bank, however, estimates that “more people living close to the international poverty line the developing world in low and middle income countries will suffer the greatest consequences in terms of extreme poverty”.
Their research estimates that the population pushed into extreme poverty is expected to be about 5 million in Nigeria, 2 million in Democratic Republic of Congo and 1 million in Indonesia, South Africa, and China, as a consequence of Covid-19.
India’s 2011 census reported the extreme poverty rate at about 21 per cent, whereas US think-tank Bookings Institute quoted data from the World Poverty Clock to say India in 2018 had about 73 million people under extreme poverty, about 5.4 per cent of its population.
Methodology
Researchers relied on data from ‘PovcalNet’ (an online tool provided by the World Bank for estimating global poverty) and the IMF’s World Economic Outlook. The study assumes that “Covid-19 does not change inequality within countries”. Researchers compare the Covid-19-impacted forecasts with the earlier forecasts from the World Economic Outlook from October 2019. The study is published by Daniel Gerszon Mahler, Christoph Lakner and R. Andres Castaneda Aguilar of the Development Data Group of the World Bank and Haoyu Wu, a World Bank Consultant for Poverty and Equity Global Practice.