Livelihoods in rural India have become increasingly linked to the wider economy. This has caused considerable changes to the wellbeing of many households, causing simultaneous movements into and out of poverty. This paper seeks to explain the reasons why some households have been able to take advantage of new economic opportunities, whilst the livelihoods of others have stagnated or declined. In particular the paper will explore the impact of increased external linkages on poverty and vulnerability. However, it is not only changes to the economy which have caused households to move into or out of poverty. Shocks, such as illness and other extraordinary expenses, put livelihoods under additional pressure. Therefore the paper also explores the nature of coping and accumulation strategies, to understand how short-term shocks and opportunities change the longer-term livelihood strategies of households.