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Pakistan’s Poverty Headcount Review

Present Economic Survey of Pakistan during FY2018 calculated that over the last decade, Pakistan’s poverty headcount has recorded a persistent fall both at nationwide and regional levels. Percentage of people living below poverty line has fallen from 50.4 percent in FY2006 to 24.3 percent during FY2016.

Economic experts also revealed that poverty in both rural and urban regions has also been on the falling trend with poverty headcount of 12.5 percent in Urban and 30.7 percent in rural regions during FY2016. The fall in poverty is more pronounced in urban than rural regions. Targeted poverty reduction programs such as Benazir Income Support Program (BISP), relative political stability, peace and tranquility, strong recovery from low Gross Domestic Product (GDP) growth rate of 1.7 percent during FY2009 to 4.5 percent in FY2016, continued higher inflows of remittances particularly from middle east which are destined to relatively poor families and above all a more inclusive properties of economic growth; are some of the significant reasons that can be attributed to an important fall in the poverty headcount since FY2006.

While comparing with 2011-12 largest percentage fall in poverty headcount was believed in year FY2014 when national poverty headcount was fallen by 6.8 percentage points with 6.2 percentage points fall in Urban and 7.5 percentage points in rural regions.

Poverty headcount has fallen by 5.7 percentage points in urban regions and 4.9 percentage points in rural regions between 2014 and 2016, thereby leading to an overall fall of 5.2 percentage points fall in incidence of national poverty headcount.

Economic sources also mentioned that vision 2025 has also recognized that poverty is indeed a multidimensional phenomenon, encompassing not only monetary deprivations but also the inaccessibility of education, healthcare and other amenities of life.

Furthermore, the goals and targets of the 2030 Agenda for Sustainable Development will guide development policy action over the coming years, in the pursuit of a revitalized Global Partnership for Sustainable Development. The eradication of poverty is among the most prominent of the Sustainable Development Goals (SDGs), and the problem of poverty eradication is the greatest for the least developed states, where almost half of the population still lives in extreme poverty. This is why UNCTAD argues that the LDCs is the battleground where SDGs will be won or lost. It is also said that atleast 18 of the 169 SDG targets refer explicitly to the least developed states, and dozens more are of central significance to their development success. This testifies to the concern of the international community with the development problems of these states.

CHANGE IN POVERTY HEADCOUNT (%age Points)
Year National Urban Rural
2007-086.33.97.7
2010-117.36.57.6
2011-120.53.4-1
2013-146.84.67.5
2015-165.25.74.9

Economic survey also reported that the fall in poverty incidence is phenomenal in Pakistan since FY2008 and normal intersurvey fall is almost 7-percentage point with only exception is 2010-11. The intersurvey fall in poverty headcount was insignificant in 2011-12 compared to 2010-11 survey. There can be two possible undertones for this low performance. First, inter-survey period may not be a period sufficient to observe meaningful fall in poverty both at national and regional levels. Two, catastrophic floods of 2010-11 hit a significant blow to rural populace whose income and livelihoods were severely affected by these floods.

The Ministry of Finance also mentioned in a report that overall, despite floods of 2010 and chronic energy crisis, aggravated security condition and government’s limited capacity to mobilize and channelize its own resources exclusively for social welfare and poverty eradication programs, the falling trend in Poverty headcount in Pakistan is both promising and encouraging. Strong resurgence of economic growth, more provincial autonomy to shape and spearhead their own social welfare and poverty eradication programs and targeted social safety nets program of BISP have all been the main drivers of poverty fall in the past.

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