13% Pakistanis live on $1.50 per day: WB

Pakistan has made an impressive progress in reducing absolute poverty and improving shared prosperity, but despite the progress, an estimated 23 million people, 13% of the population, live on an amount between $1.25 and $1.50 per day, World Bank (WB) reported.

Reviewing the country’s performance, WB said in its recent report that the proportion of the population below the national poverty rate has fallen from 34.7% in Financial Year 2002 (FY02) to an estimated 12.4% in FY11. But, future efforts are needed to improve poverty monitoring and policy evaluation, it added.

The report stated that the country has already achieved the first millennium development goal (MDG) by more than halving, between 1991 and 2011, the proportion of people whose income is less than $1.25 a day.

Furthermore, it said growth in the real per capita consumption of the bottom 40% was a respectable 3% between 2006 and 2011. “Poverty reduction has been strongest in the traditionally poorer provinces of Khyber Pakhtunkhwa (KP) and Sindh, where poverty rates are now indistinguishable from those in Punjab. Poverty remains much more prevalent in Balochistan, however, where a sizeable portion of residents are nomadic and live in remote and conflict-affected areas,” it added.

The WB report pointed out that despite the progress, a large portion of the population remains vulnerable to falling back into poverty, adding that although Pakistan’s recent gains in poverty were rapid, they remain fragile in part because many households remain clustered near the poverty line.

An estimated 23 million people live on an amount between $1.25 and $1.50 per day, meaning that small reductions in consumption can greatly increase poverty rates, it said.

“Poverty measurement can be institutionalised through more independent and regularised poverty assessments that link measurements to other human development indicator data bases. Another needed step is establishment of a constructive partnership between official authorities, donors, and academics to promote high-quality and timely measurement of poverty and shared prosperity, analysis, and programme evaluation. Additional data collected at the mauza (similar to village) or tehsil (sub-district) level can be used to generate more detailed estimates to help policymakers better locate poor pockets within the districts,” WB suggested.

Finally, it said, there is a great need to generate more evidence on the effectiveness of different interventions in reducing poverty.

WB stated that poverty measurement remains controversial in Pakistan, adding that an inordinate amount of energy and attention in the poverty debate has focused on the accuracy of a single number – the poverty head count – instead of on the underlying factors driving poverty and the programmes that might improve the welfare of the poor. “The large decline in headcount poverty has been met with considerable public skepticism, and respected economists in Pakistan are producing estimates that are at odds with the official figures. The 2007/2008 poverty figures were never officially released, and estimates of the 2010/2011 poverty rate were only released in January 2014,” WB indicated. While poverty estimates are affected by several methodological imperfections, these issues likely do not alter the conclusion that poverty has fallen substantially.

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