As of 2025, the World Bank’s updated International Poverty Line (IPL) stands at $3.00 per day, revised in June based on averaging national poverty lines from the world’s poorest countries and incorporating 2021 Purchasing Power Parity (PPP) adjustments. This shift from the previous $2.15 line (2017 PPP) reflects rising global costs and better aligns with realities in low-income nations, but for India, it exposes stark discrepancies in official poverty narratives.

India lacks an official per-day monetary poverty line since abandoning the Tendulkar Committee’s 2011–12 thresholds (approximately Rs. 27 rural and Rs. 33 urban per day, updated informally to Rs. 35–43 by 2022), shifting instead to the Multidimensional Poverty Index (MPI). The Rangarajan Committee’s higher proposals (Rs. 32–47 per day in 2014, adjusted to Rs. 50–60 by 2022) were never adopted, leaving global benchmarks like the IPL to highlight that extreme poverty persists at around 5.3% under the old $2.15 line in 2022–23—yet government claims of near-eradication rely on manipulated data that understate the crisis.

Official narratives boast of lifting 135–270 million from poverty since 2015, crediting welfare schemes and economic growth, but a closer examination reveals these claims as illusions built on fudged GDP figures, irregular surveys, and selective metrics that mask persistent deprivation. Per Capita Income (PCI) has nominally risen from $1,561 in 2014 to a projected $2,880–$2,940 in 2025, driven by reported GDP growth of 7–8% annually. However, independent analyses suggest actual growth hovered at 2.5–4% post-2020, with official data inflated by 2–3% through overstated private consumption and ignored informal sector collapses. This GDP mirage manifests in discrepancies between expenditure and production approaches, peaking at 2.5 percentage points, as unmeasured informal activity (45% of the economy) and deflator manipulations prop up figures while rural distress festers.

Poverty estimates, interpolated between infrequent household surveys like the 2022–23 and 2023–24 Household Consumption Expenditure Surveys (HCES), depend heavily on these inflated GDP growth assumptions. With an elasticity of poverty to growth around -2.11, official projections understate poverty by 40–50% if real growth is capped at 4%, potentially undercounting 10–20 million in extreme poverty by 2025. The 2017–18 survey was notoriously scrapped for “data quality issues,” creating a decade-long gap filled with extrapolations that align suspiciously with government narratives of decline—from 22.5% in 2011 to ~2% in 2025 at the old $2.15/day line. Yet, under the new $3.00 IPL, rates remain higher, with 56% of the population (81 crore) still reliant on free rations, indicating hand-to-mouth existence for nearly 100 crore below effective thresholds. This dependency, valued at 10–20% of poverty-line income through schemes like PMGKAY, is imputed into consumption data to artificially boost metrics, but critics argue it fosters stagnation without addressing structural job losses.

Income inequality further debunks these claims, with government Gini coefficients claiming a decline to 25.5 by 2022 (consumption-based), attributed to welfare smoothing. Independent estimates from the World Inequality Lab (WIL) paint a grim picture: income Gini rose from ~35 in 2014 to 0.40–0.43 by 2025, with wealth Gini at 0.74–0.82, the highest since colonial times. The top 1% captured 22.6–23% of income and 40–43% of wealth by 2023, up sharply post-2020, while the bottom 50% saw incomes fall 20% during COVID and hold just 3% of wealth. This surge, documented in India’s economic trajectory, contradicts official equality gains, as PCI growth skews toward elites amid K-shaped recovery—services and manufacturing benefit the skilled, bypassing the 89% informal workforce where wages stagnate.

Government gaslighting is evident in selective data use: consumption surveys undercapture income extremes, omitting ultra-rich savings and vulnerable migrants, leading to understated inequality and poverty. CAG audits reveal deficiencies, with PDS leakages (10–20% grains diverted), bogus cards, and corruption totaling Rs. 9–10 lakh crore from 2014–2025, including Rs. 10,000 crore inefficiencies in PMGKAY extensions. Schemes like MGNREGA promise 100 days of work but deliver only 45–50, with <10% households completing quotas and Rs. 1,500–2,000 crore misappropriated, highlighting unspent funds (62%) amid rural poverty. Regressive GST, exposed as a consumption collapse, yields Rs. 20 lakh crore annually but burdens low-income groups (70–80% collections), with exemptions favoring corporates (Rs. 5–6 lakh crore), widening gaps.

Crony capitalism amplifies manipulations, as PCI inflation benefits “government friends” like Adani, whose wealth surged from $8 billion in 2020 to $143 billion by 2022 via preferential contracts, while crony sectors rose to 8% of GDP. In government expenditure, debt-fueled infrastructure (capex Rs. 11.21 lakh crore in 2025–26) incurs overruns (Rs. 15–40k crore), with public debt at 85% of GDP masking true burdens. Unraveling these GDP illusions shows how official forecasts overstate progress, with real drags from tariffs and debt risking contractions, eroding trust in metrics like MPI reductions (from 25% in 2015–16 to 10% in 2025) that ignore income disparities.

In India’s economic crossroads, poverty claims crumble under scrutiny: fudged growth interpolates lower rates, but with Gini climbing to 43 and 200 million in rural deprivation, the narrative is a facade. Independent verification, from WIL to CAG, confirms overstatements, urging a reckoning with data integrity to address true inequities.