The Poverty Paradox

India’s success in reducing poverty over the past decades is often celebrated through statistics—percentage points declined, districts lifted, households upgraded. But as the nation inches toward its developmental ambitions, the real challenge lies not merely in lowering numbers but in confronting the complex, evolving nature of deprivation itself. The recent declaration by Kerala that it has become “extreme poverty-free” encapsulates this tension between measurable progress and lived realities. It offers a moment for the country to reflect on what poverty eradication means and what it should mean in twenty-first-century India.

Kerala always stood as an influential reference point in the national development discourse. Its high literacy, robust public health system, and leading Human Development Index have shaped what came to be known as the “Kerala Model.” Rooted in historic struggles for land, healthcare, education, and social justice, the model has demonstrated the transformative potential of sustained welfare investment. These foundations explain why the state often leads debates on rights-based entitlements, decentralised governance, and inclusive politics.

It was in this context that Kerala launched the Extreme Poverty Eradication Project (EPEP) in 2021—an ambitious, state-wide effort to identify and uplift households facing acute deprivation. Kudumbashree networks, ward-level committees, and local governments surveyed more than a lakh families to assess the severity of deprivation across four basic pillars: food, housing, healthcare, and livelihoods. After multiple rounds of verification, what the state called “super checks”, the list was refined to 64,006 families. These households were then supported through targeted interventions: new homes, repairs, livelihood assistance, MGNREGS jobs, and access to social protection schemes.

The project’s culmination came on November 1, 2025, when Chief Minister Pinarayi Vijayan declared Kerala “extreme poverty-free.” For a country where welfare delivery is often fragmented or inconsistent, Kerala’s coordinated push stands out as a demonstration of what decentralised governance can achieve when political intent and administrative machinery align.

Yet the strength of Kerala’s claim does not negate the questions it raises—questions that matter not only for Kerala but for India’s broader development trajectory.

The first is the nature of the definition itself. EPEP’s framework is administratively precise, but its four-pillar approach can capture only part of the lived experience of poverty. Deprivation today is multidimensional, often intertwined with factors like chronic unemployment, digital exclusion, indebtedness, inadequate education, gender-based disadvantages, and the absence of social voice. A family may have a house and a ration card but remain trapped in a cycle of vulnerability shaped by joblessness, emergencies, or social marginalisation. This gap between official classification and lived reality is not unique to Kerala—it is a national challenge.

The second question concerns transparency. While Kerala has highlighted the achievements of EPEP, the full methodology of the verification process, along with third-party audits, has not yet been published. This has raised the eyebrows of economists, activists, and Opposition parties. Transparency would not diminish the initiative; it would strengthen public confidence in it. India’s welfare system, increasingly data-driven, needs rigorous and publicly accessible verification mechanisms. Kerala, historically a pioneer of open governance, can set the benchmark here, not just in claiming victory but in demonstrating how victory is verified.

Third, and most crucially, are the communities that remain outside the project’s ambit. According to the Union government’s own Antyodaya Anna Yojana (AAY) database, nearly six lakh households in Kerala continue to fall under the “poorest of the poor” category. Likewise, over one lakh Adivasi families remain outside EPEP’s radar, many still confronting malnutrition, insecure housing, and limited healthcare access. Their exclusion, whether methodological or structural, remains a sobering reminder of the blind spots that emerge even in well-intentioned welfare governance.

These contradictions are not Kerala’s alone. They reflect India’s wider struggle with uneven development. From the tribal belts of Chhattisgarh and Jharkhand to the urban resettlement colonies of Delhi, from Bundelkhand’s water-distressed villages to Rajasthan’s desert districts, poverty persists in pockets and forms that elude neat classifications. Numbers may show a decline, but distress is often redistributed, not resolved.

Further, this scenario mirrors the national challenge of unemployment. Despite its educational achievements, the state’s youth unemployment rate is among the highest in India, especially among graduates and women. This mismatch between education and employment is a growing issue across the country, where millions of young people enter the labour market with qualifications but few quality jobs. Without durable employment generation, poverty alleviation risks becoming a temporary relief rather than a transformative shift.

The state’s dependence on remittances offers another cautionary tale. Nearly 2.5 million Non-Resident Keralites contribute an economic stabiliser through deposits and remittances, accounting for a sizable share of the state economy. But this dependence mirrors patterns seen across several Indian states—Punjab, Goa, parts of the Northeast—where migration cushions local unemployment but also exports human capital and suppresses domestic industrial expansion. As energy transitions and demographic shifts reshape the Gulf economies, such dependence becomes increasingly fragile.

Internal inflation crisis in states is a reminder of another structural vulnerability India must recognise. With retail inflation far above the national average, states including Kerala reflect the pressures of an import-dependent, consumption-driven economy. The rising cost of essentials erodes purchasing power, pushing even middle-income families into quiet distress, especially in urban centres with high housing and food costs. The lesson is clear: poverty reduction cannot be understood without factoring in the cost-of-living crisis.

The timing of Kerala’s declaration, just months before local body elections, has naturally invited political scepticism. The Opposition even boycotted the Assembly session marking the event, calling the claim premature. But such contestations are routine in India, where welfare achievements often collide with electoral cycles. What ultimately matters is not the timing but the credibility of the progress.

India’s next stage of development must move from poverty alleviation to poverty prevention, building systems that not only lift families out of deprivation but ensure they never slip back. This second-phase approach, in Kerala or any other state, must centre on durable employment, skilling for the digital economy, stronger social protection for frontline workers, and climate-resilient livelihoods. Welfare must align with economic diversification through industries, agro-processing, renewable energy, biotechnology, and decentralised start-ups that create sustainable value.

Institutional transparency is just as critical. Publishing methodologies, inviting independent audits, creating public dashboards, and enabling robust grievance redressal can strengthen trust in welfare programmes nationwide. Citizens increasingly demand accountability not as confrontation but as a democratic right.

Kerala’s declaration, then, is not an endpoint but an invitation for India to rethink what eliminating poverty truly means in a rapidly changing society. The real measure of progress is not a statistic that hits zero but whether every marginalised household—from Attappady to Bastar, Wayanad to West Delhi—can live with dignity, security, and opportunity. Poverty’s end is not an event; it is a sustained commitment. India’s future welfare architecture must rest on that enduring promise.

Views expressed are personal. Amal Chandra is an author, policy analyst, and columnist; Hima Tara Sam is a history scholar from Delhi University and a policy analyst