The paper assesses the impact of economic reforms on poverty incidence bydecomposing the change in poverty ratio into growth/mean effect, inequalityeffect, and population shift effect for the rural and urban areas of 15 majorstates and at the all-India level. Using National Sample Surveys, data wereanalyzed for two time periods:(i) 1983 to 1993/4 and (ii) 1993/4 to1999/2000, broadly representing the pre-reform and reform period,respectively. The growth/mean effect dominates in both periods over theinequality effect and the population shift effect. The growth effect, which isbeneficial for poverty reduction, seems to have gone up in the reform period.The adverse inequality effect also fell during the reform period. States with agreater beneficial growth effect in the reform period also show a fall in themagnitude of an adverse population shift effect in the urban areas, ie, arelatively smaller increase in the incidence of urban poverty caused byrural-urban migration