What policy shift is needed to move from welfare-driven poverty alleviation to employment-led prosperity on the road to Viksit Bharat @2047?

Between 2011 and 2023, an estimated 496 million Indians moved above the $4.20/day line, and extreme poverty fell to 2.6% [1]. Yet 80% still live below the $8.30/day upper-middle-income line [1][2]. Transfers have largely tackled destitution, but only productive, better-paid jobs can deliver Viksit Bharat.

Why welfare-led alleviation has reached its limits

• Transfers worked: 24.82 crore people escaped multidimensional poverty between 2013-14 and 2022-23 [4]. The World Bank credits food subsidies and social transfers alongside consumption growth [1].
• Fragile gains: about 13.5% of Indians sit between $3.00 and $4.20/day (2.6% vs 16.1%) [1]. One illness or crop loss can push them back.
• Jobs without earnings: employment rose by about 134 million (2017–23), but real earnings stayed broadly flat, and most new jobs are in low-productivity work [1].
• Informality: about 90% of workers are informal. Real wages of regular salaried workers stagnated or fell during 2012–22 [3].

Policy shifts required

• Transfers → earnings: promote labour-intensive manufacturing, MSME credit and agro-processing. Focus on the Uttar Pradesh–West Bengal belt, which holds about 57% of India's poor [1].
• Job numbers → job quality: written contracts, social security under the Labour Codes, portable benefits for gig workers and less contractualisation [3].
• Enforce existing wage law: in 2022, 62% of unskilled casual farm workers and 70% of unskilled construction workers were paid below the legal minimum [3]. Enforcing the law costs less than a new scheme and helps exactly the households just above the line.
• Skills and women's work: youth unemployment rose to 15.9% [1]. Skilling should match industry demand. Childcare and safe transport would help women, whose entry into paid work drove recent gains, stay employed [1].
• Measure prosperity, not just survival: NITI Aayog's SDG-1 framework [5] should also track the state-wise share of people below $4.20 and $8.30, alongside the MPI.

India's welfare system has built a floor under the poor; prosperity now needs a ladder of formal, productive and better-paid jobs. A lean, targeted safety net combined with earnings-led growth, as SDG-1 and SDG-8 envisage, can turn escape from poverty into secure middle-class living by 2047.