Poverty declines from 2010 to 2022, inequality and vulnerability remain: WB report

Bangladesh has significantly reduced poverty between 2010 and 2022. During this period, around 25 million people moved out of poverty, and 9 million came out of extreme poverty. Access to essential services including electricity, education and sanitation also improved.

The World Bank highlighted these findings in its ‘Bangladesh Poverty and Equity Assessment 2025’ report published on Tuesday, November 25.

According to the report, extreme poverty fell from 12.2 percent in 2010 to 5.6 percent in 2022, while moderate poverty dropped from 37.1 percent to 18.7 percent. However, nearly 62 million people—6.2 crore—remain vulnerable to falling back into poverty due to unexpected shocks, illness or natural disasters.

The World Bank noted that Bangladesh’s economic growth has become less inclusive since 2016. The wealthiest households have gained disproportionately, widening income inequality. Poverty reduction has been faster in rural areas as the agriculture sector acted as the main driver, but urban poverty reduction has been much slower. By 2022, one in every four poor Bangladeshis lived in urban areas.

International and domestic migration have also played a key role in poverty reduction. Remittances have benefited poor households, but internal migrant workers in densely populated urban areas face poor living conditions. International migration remains limited to relatively better-off households due to high costs.

Although social protection programmes have expanded, they remain ineffective and poorly targeted. In 2022, 35 percent of wealthy households received social protection benefits, while half of the poorest households were excluded. Subsidies for electricity, fuel and fertiliser also disproportionately benefited wealthier households.

The World Bank identified four policy priorities that can help reduce poverty and narrow inequality: strengthening foundations for productive jobs; creating more and better employment opportunities for the poor and vulnerable; developing effective markets through modern processing and supportive business investment; and enhancing resilience through robust fiscal policy and targeted social protection programmes.

Jean Pesme, the World Bank’s Country Director for Bangladesh and Bhutan, said, “Bangladesh has achieved remarkable progress in reducing poverty over the years. But climate risks, slow job creation and global shifts have weakened labour incomes. Rapid poverty reduction requires employment especially for youth, women and vulnerable populations.”

He added that employment in manufacturing has stagnated, affecting women and young people the most. One in five young women is unemployed, and one in four educated young women is out of work. Employment growth outside Dhaka has slowed, particularly for women. Half of young people aged 15–29 are engaged in low-income work, pointing to a skills mismatch.

Senior Economist Sergio Olivieri said, “Bangladesh has reduced regional disparities, especially the east–west divide. But climate risks are increasing spatial inequalities, particularly in rural and urban areas. Innovative policies, quality urban employment, pro-poor agricultural value chains and effective social protection can help restore momentum in reducing poverty and expanding shared prosperity.”