On the occasion of Kerala Piravi or Kerala Day on November 1, Chief Minister Pinarayi Vijayan announced that the state has eradicated extreme poverty, making it the first state in the country to achieve the feat.CPI(M) general secretary M A Baby credited the Left Democratic Front (LDF) government in the state with instituting policies to this end. However, he said that issues still prevail and urged all the state’s political parties to join forces to resolve them.What does this status really mean? Here is what to know.What is extreme poverty, and how is it distinct from poverty?Presently, anyone subsisting on under $3 per day is said to be living in extreme poverty, according to the World Bank. This figure is based on 2021 purchasing power parity (PPP) terms, which assumes the cost of a standardised “basket of goods” in different countries to determine how much currency would be needed to purchase the same set of items. This cut-off represents the median poverty line of 23 low-income countries.The World Bank has set poverty lines for lower-middle-income countries at $4.20 per day, and for upper-middle-income countries at $8.30 per day. Therefore, anyone earning below these cut-offs but above the $3.00 threshold is considered poor, but not extremely poor.The World Bank revised the international poverty line to $3.00 in June 2025 from the earlier $2.15 poverty line based on 2017 PPP.The Niti Aayog, the public policy think tank authorised by the Government of India, uses the Multidimensional Poverty Index as its barometer to determine the extent of poverty in the country. This measure, modelled on the Alkire and Foster methodology of Global MPI, uses 12 indicators spanning three areas: health, education and standard of living.Story continues below this adNotably, the Kerala government said it chose to rely on neither of these measures to inform its survey.How many people are living in extreme poverty?According to the World Bank, 838 million people were estimated to be living in extreme poverty in 2022 using the revised measure ($3 per day), against the previously reported figure of 713 million people announced in September 2024 and based on $2.15 per day.And how is India presently placed?In its October 2025 report, the World Bank noted that India has “significantly reduced” poverty over the last decade. Extreme poverty had fallen from 16.2 per cent in 2011-12 to 2.3 per cent in 2022-23, meaning an estimated 171 million people had been lifted out of this status according to the World Bank.The World Bank credited this transformation to the increase in employment, with urban employment falling to 6.6 per cent in the Q1 FY24/25, the lowest since 2017-18. However, it noted challenges such as youth employment (13.3 per cent), especially among tertiary education graduates (29 per cent), as well as gender disparities in employment despite a 31 per cent female employment rate. It also noted that only 23 per cent of non-farm paid jobs are formal, while the majority of agricultural employment remains informal, and self-employment has continued to increase.Story continues below this adHowever, this reading of India’s success in eliminating extreme poverty and poverty overall may be naive, as this edition of ExplainSpeaking from June 2025 explains.So, how did Kerala achieve its present status?The declaration follows a targeted four-year push led by local bodies under the state’s Extreme Poverty Eradication Programme (EPEP). The poverty alleviation programme was one of the first decisions taken by the Pinarayi Vijayan government after it assumed office for its second consecutive term in May 2021.In 2021, the local self-government department, the nodal agency for implementing the scheme, trained about 4 lakh people, including officials, elected representatives and volunteers, to identify families facing extreme poverty. They identified 118,309 families who had been excluded from the many welfare schemes of the state after rounds of field visits and discussions. From this, the list was narrowed down to 64,006 after several rounds of verification, and ultimately to 59,000 families after accounting for deaths and migration.With this in mind, the state’s local self-governing bodies instituted tailor-made microplans to address concerns related to food, health, shelter, and education to empower these families.Story continues below this adIn its survey, the state identified 4,677 homeless families and provided 4,005 of these with homes under the Life Mission government scheme for the homeless. The survey also identified 20,648 of the 59,286 families as those without access to a steady food supply. This group was provided meals by local bodies across the state.The state further launched the Avakasam Athivegam (rights fast) campaign to ensure all beneficiary families possessed the necessary civic documents (like MGNREGS job card, voter ID, Aadhaar card, bank accounts and social security pension) and essential services (electricity, cooking gas connections, etc.).M A Baby also credited the Opposition for its support in aiding the government’s efforts in eradicating extreme poverty in Kerala.