The World Bank on Wednesday warned that by 2021, as many as 150 million people are likely to be in extreme poverty because of the coronavirus pandemic and countries will have to prepare for a "different economy" post-COVID by allowing capital, labour, skills and innovation to move into new businesses and sectors.
The COVID-19 pandemic is estimated to push an additional 88 million to 115 million people into extreme poverty this year, with the total rising to as many as 150 million by 2021, depending on the severity of the economic contraction, according to the Washington-based global lender.
This would represent a regression to the rate of 9.2 per cent in 2017, according to the biennial Poverty and Shared Prosperity Report.
Had the pandemic not convulsed the globe, the poverty rate would have been expected to drop to 7.9 per cent in 2020, it said.
The pandemic and global recession may cause over 1.4 per cent of the world's population to fall into extreme poverty, World Bank Group President David Malpass said.
In order to reverse this serious setback to development progress and poverty reduction, countries will need to prepare for a different economy post-COVID, by allowing capital, labour, skills and innovation to move into new businesses and sectors, he said.
Noting that the new poor will be in countries that already have high poverty rates, the report said that a number of middle-income countries will see significant numbers of people slip below the extreme poverty line.
About 82 per cent of the total will be in middle-income countries, the report estimates.
The convergence of the COVID-19 pandemic with the pressures of conflict and climate change will put the goal of ending poverty by 2030 beyond reach without swift, significant and substantial policy action, the World Bank said, adding that by 2030, the global poverty rate could be about seven per cent.
In its report, the World Bank noted that the lack of recent data for India severely hinders the ability to monitor global poverty.
Absence of recent data on India, one of the economies with the largest population of extreme poor, creates substantial uncertainty around the current estimates of global poverty, the Bank said.
Observing that effective approaches have tapped the skills and dedication of community members, the World Bank said that in Mumbai, city officials were able to stem the rapid spread of the coronavirus in Dharavi, one of the city's largest urban settlements, by mobilising community members and staff from private medical clinics for a strategy based on mass screening for fever and oxygen levels.
In the space of three months, by July 2020, reported cases in the area had been cut to 20 per cent of their peak in May. To help poor families during the lockdown, foundations, non-governmental organisations and volunteers provided thousands of households with ration kits.
Dharavi's success stemmed from a combination of customised solutions, community involvement and perseverance, it added.
According to Johns Hopkins Coronavirus Resource Center, the contagion has infected over 35 million people and killed more than 1 million across the world.
The US is the worst affected country with over 7.5 million cases and more than 2,10,000 deaths.
The COVID-19, which originated in China's Wuhan city in December last year, has also battered the world economy with the International Monetary Fund saying that the global economy is bound to suffer a "severe recession".
Scientists are racing against time to find a vaccine or medicine for its treatment.