Despite an appreciable stability achieved at
macro-economic fundamentals during last three years the poverty level
has simultaneously increased during the period and according to an
estimate a formidable 35-36 percent of the population living below
poverty line in Pakistan.
There is a general feeling among the people that the
revenue targeted policies framed by the international donor agencies
especially the IMF were responsible for adding to the miseries of the
middle and low income groups in the country.
Although it is quite obvious that the indirect taxes
and levies on essential commodities like POL products and electricity
consumption were responsible for raising the prices of these items, it
sounds funny when the policy makers set up various task force or
committees to find out solution of the problematic areas.
The poverty alleviation program, which is on top of
the government agenda, can only produce results when the taxes and
levies are recovered according to the level of the income instead of
putting these levies through indirect tax system which does not
discriminate among the poor and the rich. The worst thing of the
indirect taxation system is that it deals indiscriminately with the poor
as well as the rich.
In order to deal with the situation, the government
on its part has recently constituted a task force on poverty alleviation
and employment generation under the chairmanship of Minister for
Privatization Dr. Hafeez Shaikh.
The task force would review current poverty and
unemployment status, public sector contribution, government policies,
and suggest improvements. The task force has been asked to submit its
report within a month.
The task assigned to the committee includes reviewing
the current state of poverty and unemployment in the country. To assess
the impact of public sector development related programs on employment
generation and poverty reduction besides assessing the government
policies and programs for poverty alleviation and employment generation
through private sector development. The members and terms of reference
of the task force are Dr. Nasim Ashraf, Chairman NCHD, Dr. Ishrat
Hussain, Governor State Bank, Javed Sadiq Malik, Secretary, Planning and
Development division, Dr. Waqar Masood Khan, Secretary, Economic Affairs
Division, Dr. Ashfaq Hasan Khan, Economic Advisor, Finance Division, Dr.
A.R, Kamal, Director PIDE, Islamabad, Dr. Nuzhat Ahmed, Director Applied
Economic Research Center Karachi and others. Members from the private
sector are Farid Rehman Peshawar, Dr. Ahemd Hussain, Lahore, Dr. Salman
Shah Lahore, Shahid Kardar Lahore, Dr. Mushtaq Mirani Hyderabad, Ms.
Saadiqa Salahuddin Karachi and Malik Naeem Khan Quetta.
Meanwhile, Center for Research on Poverty Reduction
and income distribution of the Planning Commission has suggested the
government to adopt Human Poverty Index (HPT) as a scale to measure
poverty, which says 40 percent of the population was poor in 2001. This
he said at the launch of the second Pakistan Human condition report
The human conditions are not improving in the country
for last two decades especially in health sector. In order to meet the
social development, the government needs to enhance present 3 per cent
spending on health to nearly double at 5-6 percent in medium term, the
Income or consumption expenditure based poverty
measures like head-count index, poverty gap, poverty severity measure
only the deprivation in income/consumption expenditure, which is only
one dimension of poverty. The only existing tool closer to the measuring
the deprivation is the Human Poverty Index (HPI) of UNDP. Though the
data required for the estimation of this index is characterized by
paucity and non-creditability, this does not affect the extent of
accuracy of HPI as compared to other aggregate poverty measures. Thus it
is highly desirable to use HPI as a poverty measure, the report
The government measured the poverty level at 32.1
percent in 2001 rising from 29.8 percent in 1997 and 30.6 percent in
The officially notified poverty line is of Rs748.56
per capita per month based upon the minimum caloric requirement of 2350
calories per day at the price of the year 2000-01. Based upon this
poverty line, the percentage of population estimated to the poor is
32.13 percent i.e. 45.13 million, the report estimated.
Out of 45 million poor, 62.63 percent are transitory
poor, 4.98 percent extremely poor i.e. below Rs374.3 per person per
month and 32.39 percent are chronically poor. Transitory poor keep
falling in and out of the poverty due to economic shocks and are
characterized as transitory poor.
In Pakistan, poor and non-poor are densely located
around the poverty line, that is why poverty line should be used as a
tool for the basis of the efficiency and cost effectiveness of any
pro-poor policy. Effects of the poverty are also felt on the people not
falling under poverty line, because of their extensive vulnerability to
socio-economic shocks, rendering their non-poor situation a temporary
People feel that while constituting any task force or
committee especially for carrying out poverty reduction plans,
representation should also be given to the poor who can really point out
the actual gravity of the situation as they know the taste of the