In the Pandemic, India’s Middle-Class Shrinks and Poverty Spreads while China Sees Smaller Changes

Reducing poverty and improving equity
Posted Mar 28, 2021 | Pew Research Center, Rakesh Kochhar

The number of extreme poor in India (with incomes of $2 or less a day) is estimated to have increased by 75 million because of the COVID-19 recession. This accounts for nearly 60 percent of the global increase in poverty. Rakesh Kochhar notes in this article of the Pew Research Center that while India plunged into a deep recession in 2020, China’s contraction was far more modest. In January 2020, economic forecasts from the World Bank pointed to virtually the same growth in real gross domestic product (GDP) in India (5.8 percent) and China (5.9 percent) whereas in January 2021, nearly one year into the pandemic, these growth estimates were revised downward to -9.6 percent for India and 2 percent growth for China. The largest impact in China is the estimated addition of 30 million people to the low-income tier (incomes of $2.01-$10 a day). The number of people in the middle-income tier has likely decreased by 10 million, while the number in extreme poverty remained virtually unchanged.


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