This research paper presents a microeconomic assessment of government welfare programs in rural India, aiming to evaluate their effectiveness in poverty alleviation. The study encompasses data collected from 963 households across five states: Bihar, Uttar Pradesh, West Bengal, Rajasthan, and Madhya Pradesh. The research objectives were to assess awareness and participation rates, examine the perceived impact on economic well-being and education, and understand the reasons for non-participation. The methodology involved stratified random sampling and in-person questionnaires. The key findings indicate that while there is substantial awareness of government welfare programs among rural households, participation rates are lower, signaling the need for enhanced outreach strategies. Respondents perceived these programs as effective in improving economic well-being and education, underscoring their positive contributions to rural development. Furthermore, satisfaction with the application process was high, indicating efficient program administration. Lack of awareness emerged as a prominent reason for nonparticipation. These findings align with prior literature emphasizing the critical roles of government welfare programs in poverty alleviation. The study’s implications extend to policymakers, businesses, and stakeholders in the field of rural development. Recommendations include targeted awareness campaigns, expansion of education-focused initiatives, and continuous efforts to improve the application process. Overall, this research underscores the significance of government welfare programs in addressing rural poverty and fostering sustainable development in India.