Why Poverty hasn't reduced significantly in Pakistan

[third eye]

ISLAMABAD:

Poverty is one of the least discussed issues in Pakistan. While many debates centre around different economic issues, poverty is mostly left out. It is quite odd that local discourse on such a serious issue is very elusive in our country.

Successive governments in Pakistan have also intentionally shied away from this debate. For example, the Pakistan Peoples Party government didn’t release poverty statistics for years it stayed in government.

Similarly, the PML-N hasn’t released poverty rates for its tenure. The poverty rate announced in 2016 by then Minister of Planning and Development Ahsan Iqbal was for the year 2013 when PML-N was voted into power. Clearly, political parties don’t intend to land in hot water by talking about poverty.

Academic studies on the subject further confound our understanding of poverty. There is considerable ambiguity around the methodology to estimate the rate of poverty. As a result, there is no single and well-accepted poverty rate in Pakistan. Each academic study on poverty estimation gives its own poverty rate that may be different from others. In some cases, there are significant differences between the calculated poverty rates.

However, according to the latest available official statistics, almost 30% of Pakistanis were living below poverty line of Rs3,030 per adult per month in 2013. This translates to roughly 59 million in absolute terms. The poverty line used by the government is totally absurd. How can we consider an adult as not poor who earns Rs3,030 per month? This casts serious doubts on the poverty rate reported by the government.


A more reasonable poverty line can be the international poverty line of $2 per day. As per this poverty line, a whopping 60% of Pakistanis are poor. Now another type of poverty rate called multidimensional poverty rate is also being calculated in Pakistan, which relies on non-income indicators. Here again, not many are aware of what is multidimensional poverty.

But poverty is the main reason why international development institutions like the World Bank finance variety of projects in Pakistan.

Pakistan has received millions of dollars in the name of poverty reduction. Varieties of economic policies are framed by the government under the pretext of poverty reduction.

Despite the fact that Pakistan has received a lot of money for fighting poverty from donor institutions; it hasn’t seen significant reduction in poverty levels. This is especially true when comparison is made with India and China. Both of these economies have experienced steep fall in their poverty levels. Pakistan’s progress in this area has been sluggish as best.

From 1951 till now, there hasn’t been a year when a government-led poverty reduction program wasn’t under way. The initial programmes were completely donor funded with focus on education and health of the rural economy. Overtime, some programmes under public-private partnership mode also started with a more varied focus like housing, roads, and sanitation.

In addition, government also adopted redistribution policies like land reforms, pricing of agricultural products, subsidies, social security payments, high tax rates and direct income transfers.

In the last few years, redistributive policies have become more popular with both people and the political parties. This shift in policy is influenced by a stream of literature which purports that poverty reduction can only be achieved if inequality is reduced using redistributive policies. Many local studies on poverty have also come up with the same idea.

Such policies place the government at the centre of the effort to redistribute economic gains to reduce poverty.

Failure of government

Focusing too much on programmes and redistributive policies has done more harm than good. Almost all of the programmes have fallen prey to government failure and corruption. The most recent example is that of the Benazir Income Support Program (BISP). Stories of corruption in BISP are common knowledge. The problem is that whenever a programme lands into political hands, political considerations always precede sound economic sense.

The BISP forms were given to PPP MNAs for distribution and naturally, those with strong political connections ended up having it over genuine individuals. Although it must be admitted that programmes run in collaboration with the private sector seem to produce better results than those run exclusively under the government’s watch.

On the other hand, the redistributive policies adversely affect the pricing mechanism. Support prices of key agriculture commodities creates glut-like situation which wipe out economic profits. Along with this, increasing tax rates on corporations in order to pay for welfare programs discourages businesses.

It won’t be wrong to conclude that government’s policies have stunted the impact of economic growth to reduce poverty significantly.

If Pakistan is to reduce poverty significantly, it must promote employment opportunities. The surest way to achieve that is by allowing businesses to employ more people. This can only be achieved if predatory redistributive policies are withdrawn.

The writer is a researcher and works in the development sector of Gilgit

Published in The Express Tribune, January 22nd, 2018.

 

[jetray]

@third eye dude dont post such article again. you are just creating a thread for cheap trolls which will soon spiral into t0ilet wars. It should be none of our concern what happens in their country. remember you can a good conversation with good ppl. simply stick to India related news.

 

[BannuTorkham]

Before We give way for a dirty dirty slugfest...


1 ) i would first say that the Security mentality of Pakistan.. which has led to ballooned defence expenditure has dampened its welfare prospects.. Even India should curtail defence spending.

When BB was launching National Social Program for welfare... Ghulam Ishtiaq Khan and Gen Beg were too busy mudslinging her. poor state..

2) VIRTUAL DEATH OF Communist Movement in Pakistan...

 

[saiyan0321]

ISLAMABAD:

Poverty is one of the least discussed issues in Pakistan. While many debates centre around different economic issues, poverty is mostly left out. It is quite odd that local discourse on such a serious issue is very elusive in our country.

Successive governments in Pakistan have also intentionally shied away from this debate. For example, the Pakistan Peoples Party government didn’t release poverty statistics for years it stayed in government.

Similarly, the PML-N hasn’t released poverty rates for its tenure. The poverty rate announced in 2016 by then Minister of Planning and Development Ahsan Iqbal was for the year 2013 when PML-N was voted into power. Clearly, political parties don’t intend to land in hot water by talking about poverty.

Academic studies on the subject further confound our understanding of poverty. There is considerable ambiguity around the methodology to estimate the rate of poverty. As a result, there is no single and well-accepted poverty rate in Pakistan. Each academic study on poverty estimation gives its own poverty rate that may be different from others. In some cases, there are significant differences between the calculated poverty rates.

However, according to the latest available official statistics, almost 30% of Pakistanis were living below poverty line of Rs3,030 per adult per month in 2013. This translates to roughly 59 million in absolute terms. The poverty line used by the government is totally absurd. How can we consider an adult as not poor who earns Rs3,030 per month? This casts serious doubts on the poverty rate reported by the government.


A more reasonable poverty line can be the international poverty line of $2 per day. As per this poverty line, a whopping 60% of Pakistanis are poor. Now another type of poverty rate called multidimensional poverty rate is also being calculated in Pakistan, which relies on non-income indicators. Here again, not many are aware of what is multidimensional poverty.

But poverty is the main reason why international development institutions like the World Bank finance variety of projects in Pakistan.

Pakistan has received millions of dollars in the name of poverty reduction. Varieties of economic policies are framed by the government under the pretext of poverty reduction.

Despite the fact that Pakistan has received a lot of money for fighting poverty from donor institutions; it hasn’t seen significant reduction in poverty levels. This is especially true when comparison is made with India and China. Both of these economies have experienced steep fall in their poverty levels. Pakistan’s progress in this area has been sluggish as best.

From 1951 till now, there hasn’t been a year when a government-led poverty reduction program wasn’t under way. The initial programmes were completely donor funded with focus on education and health of the rural economy. Overtime, some programmes under public-private partnership mode also started with a more varied focus like housing, roads, and sanitation.

In addition, government also adopted redistribution policies like land reforms, pricing of agricultural products, subsidies, social security payments, high tax rates and direct income transfers.

In the last few years, redistributive policies have become more popular with both people and the political parties. This shift in policy is influenced by a stream of literature which purports that poverty reduction can only be achieved if inequality is reduced using redistributive policies. Many local studies on poverty have also come up with the same idea.

Such policies place the government at the centre of the effort to redistribute economic gains to reduce poverty.

Failure of government

Focusing too much on programmes and redistributive policies has done more harm than good. Almost all of the programmes have fallen prey to government failure and corruption. The most recent example is that of the Benazir Income Support Program (BISP). Stories of corruption in BISP are common knowledge. The problem is that whenever a programme lands into political hands, political considerations always precede sound economic sense.

The BISP forms were given to PPP MNAs for distribution and naturally, those with strong political connections ended up having it over genuine individuals. Although it must be admitted that programmes run in collaboration with the private sector seem to produce better results than those run exclusively under the government’s watch.

On the other hand, the redistributive policies adversely affect the pricing mechanism. Support prices of key agriculture commodities creates glut-like situation which wipe out economic profits. Along with this, increasing tax rates on corporations in order to pay for welfare programs discourages businesses.

It won’t be wrong to conclude that government’s policies have stunted the impact of economic growth to reduce poverty significantly.

If Pakistan is to reduce poverty significantly, it must promote employment opportunities. The surest way to achieve that is by allowing businesses to employ more people. This can only be achieved if predatory redistributive policies are withdrawn.

The writer is a researcher and works in the development sector of Gilgit

Published in The Express Tribune, January 22nd, 2018.

Poverty has become a slogan spoken by a political party to get elected after which it morphs into something of a campaign to slogan.

During that party's rule the slogan is that we are eradicating poverty whereas the opposition screams poverty is growing irrespective of reality and right before elections poverty gets eliminated and the opposition screams even more loudly that the current party failed to provide for poverty and we will solve poverty.

Rinse and repeat.

Nobody is looking to address the issue.

Poverty can only be combatted in a constructive environment where self employment is encouraged and employment and ground level growth happens.

One of the most major reasons behind poverty in Pakistan is that majority of Pakistan is under the control of waderas, jagirdars, sardars and tribal elders who wish to keep the people under them poor. On top of it all the govt in Pakistan composed of these elements do nothing to solve the problem.

Now apart from socio-political restraints we also need to look at the state of the country.

The entire 90s was spent in a power struggle between president and prime minister and two parties throwing each other off. The era saw little development especially in the energy sector ( which has a massive effect over growing poverty). 1989-1999

Then came musharraf era which also saw little improvements in the energy sector. 1999-2008

And then came zardari era which was the rise of the most corrupt and incompetent govt in Pakistan history. The time also saw a poor struggling country embroiled in a devastating war by TTP in FATA, KPK and bombings in Punjab. On top of it all we saw MQM gangs rise in Karachi and the economic hub of Pakistan saw a massive decline. Plus Baluchistan saw rise of violence as insurgents targeted security forces, baluch and non baluch.

You can see the effects of this war on a poor struggling country.

Then came 2013.

Let me tell the common thinking amongst N, PTI and nearly all of Pakistan was that PPP is doing this on purpose and its a switch on thing. All hell broke loose when a new party came in power and it was revealed that everything was rusted and sold. Nothing was left. Nawaza lost his entire redness lolzz.

In this environment came CPEC. You see the environment. The hell. It jump started the economy.

Now let me explain why I use the word " jump start" again and again. Its jump starting a battery that has gone down. The car will start but that doesn't mean that the car is repaired and not broken. The battery needs to be changed and if you stop the car and don't solve the problem then it will stop requiring another "jump start" and we will not get another jump start.


So CPEC is your jump start. It is not the solution to all ills nor is it the miracle cure.

It is an opportunity that must be utilized. Perhaps best explained by @Kaptaan in his threads.

Now coming back to poverty. When the state takes economic measures to increase the human development, ground development and create employment opportunities, poverty will not be combatted.

In this jump start we must utilize this opportunity to combat poverty. The country must see internal growth and for that to happen we must touch into the poor areas of south Punjab, north sindh, FATA and most of Baluchistan. We must bring economic development and create job creating cities and opportunities.

Problem is that this is hard work and it requires the current N govt to accept that Pakistan has a massive poverty problem that they are struggling to address and take forward concrete steps to truly hit poverty.

This is the only way and I don't see this happening.

Dua hai kai mechanic is andheri gali mai khud ajaye :p :p

I fear political ineptness and squabbling will see this jump start wasted if we don't get serious about this.

 

[third eye]

@third eye dude dont post such article again. you are just creating a thread for cheap trolls which will soon spiral into t0ilet wars. It should be none of our concern what happens in their country. remember you can a good conversation with good ppl. simply stick to India related news.

Thank you for your views.

Observe what @saiyan0321 has written in post above. It shows there can be sane views too.

 

[jetray]

Thank you for your views.

Observe what @saiyan0321 has written in post above. It shows there can be sane views too.

I do agree that there are few ppl who are sane and who do disagree in a civilized manner.
But they are usually drowned by the normal troll types.

 

[Max]

http://povertydata.worldbank.org/poverty/country/PAK

http://povertydata.worldbank.org/poverty/country/IND

care about your country, let us deal with our problems.

 

[bananarepublic]

Poverty elevation can only be done throught grass root economic development and economic empowerment.
People here understand poverty as in terms of physical assets and money but poverty is multi dimensional as not only poverty in money but poverty in education and poverty in healthcare etc. But to truly solve poverty there needs to be simultaneous approch to solve healthcare,education employment .

 

[Dr Shaheryar]

Kindly note that the household income should be taken as an indicator of poverty index. Rather then individual. We have millions of families in lower class where every member of family is earning, whether be an adult or a small child.

 

[313ghazi]

Kindly note that the household income should be taken as an indicator of poverty index. Rather then individual. We have millions of families in lower class where every member of family is earning, whether be an adult or a small child.

Are you suggesting that those people are then not poor because they have a large household income? It is not acceptable that children should have to work. Children who should be in school or playing, are working in slave like conditions BECAUSE they are poor.

It's attitudes like this from the wealthy elite like yourself which is why poverty is increasing in Pakistan. You'd much rather the Indians didn't have a talking point, than the rate of poverty actually be reduced. Watch this thread as hundreds of rich burger kids show up to counter the article because everyone they know can afford to hangout in the coolest shopping mall, therefore how can there be poverty!

 

[DESERT FIGHTER]

ISLAMABAD:

Poverty is one of the least discussed issues in Pakistan. While many debates centre around different economic issues, poverty is mostly left out. It is quite odd that local discourse on such a serious issue is very elusive in our country.

Successive governments in Pakistan have also intentionally shied away from this debate. For example, the Pakistan Peoples Party government didn’t release poverty statistics for years it stayed in government.

Similarly, the PML-N hasn’t released poverty rates for its tenure. The poverty rate announced in 2016 by then Minister of Planning and Development Ahsan Iqbal was for the year 2013 when PML-N was voted into power. Clearly, political parties don’t intend to land in hot water by talking about poverty.

Academic studies on the subject further confound our understanding of poverty. There is considerable ambiguity around the methodology to estimate the rate of poverty. As a result, there is no single and well-accepted poverty rate in Pakistan. Each academic study on poverty estimation gives its own poverty rate that may be different from others. In some cases, there are significant differences between the calculated poverty rates.

However, according to the latest available official statistics, almost 30% of Pakistanis were living below poverty line of Rs3,030 per adult per month in 2013. This translates to roughly 59 million in absolute terms. The poverty line used by the government is totally absurd. How can we consider an adult as not poor who earns Rs3,030 per month? This casts serious doubts on the poverty rate reported by the government.


A more reasonable poverty line can be the international poverty line of $2 per day. As per this poverty line, a whopping 60% of Pakistanis are poor. Now another type of poverty rate called multidimensional poverty rate is also being calculated in Pakistan, which relies on non-income indicators. Here again, not many are aware of what is multidimensional poverty.

But poverty is the main reason why international development institutions like the World Bank finance variety of projects in Pakistan.

Pakistan has received millions of dollars in the name of poverty reduction. Varieties of economic policies are framed by the government under the pretext of poverty reduction.

Despite the fact that Pakistan has received a lot of money for fighting poverty from donor institutions; it hasn’t seen significant reduction in poverty levels. This is especially true when comparison is made with India and China. Both of these economies have experienced steep fall in their poverty levels. Pakistan’s progress in this area has been sluggish as best.

From 1951 till now, there hasn’t been a year when a government-led poverty reduction program wasn’t under way. The initial programmes were completely donor funded with focus on education and health of the rural economy. Overtime, some programmes under public-private partnership mode also started with a more varied focus like housing, roads, and sanitation.

In addition, government also adopted redistribution policies like land reforms, pricing of agricultural products, subsidies, social security payments, high tax rates and direct income transfers.

In the last few years, redistributive policies have become more popular with both people and the political parties. This shift in policy is influenced by a stream of literature which purports that poverty reduction can only be achieved if inequality is reduced using redistributive policies. Many local studies on poverty have also come up with the same idea.

Such policies place the government at the centre of the effort to redistribute economic gains to reduce poverty.

Failure of government

Focusing too much on programmes and redistributive policies has done more harm than good. Almost all of the programmes have fallen prey to government failure and corruption. The most recent example is that of the Benazir Income Support Program (BISP). Stories of corruption in BISP are common knowledge. The problem is that whenever a programme lands into political hands, political considerations always precede sound economic sense.

The BISP forms were given to PPP MNAs for distribution and naturally, those with strong political connections ended up having it over genuine individuals. Although it must be admitted that programmes run in collaboration with the private sector seem to produce better results than those run exclusively under the government’s watch.

On the other hand, the redistributive policies adversely affect the pricing mechanism. Support prices of key agriculture commodities creates glut-like situation which wipe out economic profits. Along with this, increasing tax rates on corporations in order to pay for welfare programs discourages businesses.

It won’t be wrong to conclude that government’s policies have stunted the impact of economic growth to reduce poverty significantly.

If Pakistan is to reduce poverty significantly, it must promote employment opportunities. The surest way to achieve that is by allowing businesses to employ more people. This can only be achieved if predatory redistributive policies are withdrawn.

The writer is a researcher and works in the development sector of Gilgit

Published in The Express Tribune, January 22nd, 2018.

Even “mazdoori” unskilled Labourers days pay (fixed) is over 500-600.

Apart from that govt has Income Support Program... where every poor family is given a monthly stipend. Total amount rekeased in 2015-16 was 98 billion RS.


Poverty is an issue but certainly not as big as the writer considers it to be.

Are you suggesting that those people are then not poor because they have a large household income? It is not acceptable that children should have to work. Children who should be in school or playing, are working in slave like conditions BECAUSE they are poor.

It's attitudes like this from the wealthy elite like yourself which is why poverty is increasing in Pakistan. You'd much rather the Indians didn't have a talking point, than the rate of poverty actually be reduced. Watch this thread as hundreds of rich burger kids show up to counter the article because everyone they know can afford to hangout in the coolest shopping mall, therefore how can there be poverty!

Hes right.

I can give you plenty of examples..

Lets take example of an expat.

Ive seen several cases , where one son is working abroad and his entire family is sitting idle and eating what he sends.. brothers doing nothing but riding new corollas.

By your logic, since the expats siblings are unemployed... earning nothing does that make them poor individuals?

In a city like Karachi, you wont even get domestic help under 20,000 .. and that’s only for a few hours... where the lady/maid... does cleaning,dishes or cooking at most and goes back to her own house.

 

[313ghazi]

Even “mazdoori” unskilled Labourers days pay (fixed) is over 500-600.

Apart from that govt has Income Support Program... where every poor family is given a monthly stipend. Total amount rekeased in 2015-16 was 98 billion RS.


Poverty is an issue but certainly not as big as the writer considers it to be.


Hes right.

I can give you plenty of examples..

Lets take example of an expat.

Ive seen several cases , where one son is working abroad and his entire family is sitting idle and eating what he sends.. brothers doing nothing but riding new corollas.

By your logic, since the expats siblings are unemployed... earning nothing does that make them poor individuals?

In a city like Karachi, you wont even get domestic help under 20,000 .. and that’s only for a few hours... where the lady/maid... does cleaning,dishes or cooking at most and goes back to her own house.

This is the problem, you guys see it from your own perspective, you have to trust the statistics, because life is bigger than your and my experience. Pakistan has a population of 200 million people. There are 7 million expats. Assume for a minute that every single one of those is supporting a family of 5/6. That's 50 million people being supported by foreign money - what about the rest? How much money do you think the labourers in the gulf make?

You talk about 20,000Rs for cleaners and 500Rs for day labourers, but what will that buy you? A days wage in the UK will earn you enough to buy a shopping basket of groceries to live off for a week. Will Rs600 do that?

My family are from a rural background in AJK. They do okay because my father sent back a lot of money over the years and bought farmland, built homes, built shops. Even then for big medical expenses they rely on my cousins who work abroad to send money home. In our village there are people who don't have that support and they still live in homes made from mud. People provided them sadqa to help them build more rooms with bricks instead of mud. In AJK 95% of people who don't have someone abroad are in the same position. That is poverty.

Look at the average height of our country has decreased since the 50's. Our nutritional intake is low, all stats point to the same thing. Every single statistic cannot be wrong.

You guys who live in the big cities have a very skewed outlook. You're truly blessed.

 

[313ghazi]

---

Also my view is skewed by my limited exposure to Pakistan too. I only know a handful of people who've managed to be successful living in the part of Pakistan i am familiar too. Clearly this is not the case everywhere. Some parts have great wealth. I've mentioned this story before that i started following a guy from twitter on snapchat because he is really funny. His videos were quite cool (travel concerts etc), i assumed he was a tourist and then had gone back to the US. One day he posted a traffic update for Karachi and it clicked that his videos were not from life in the US, they were of his life in Pakistan, in Karachi! He's no wadera ka beta (as far as i know), but i was astonished at how nice and modern some peoples lives are in Karachi!

You guys should travel to AJK to see the contrast. The only nice things are the expat villas and our cars.

 

[DESERT FIGHTER]

This is the problem, you guys see it from your own perspective, you have to trust the statistics, because life is bigger than your and my experience. Pakistan has a population of 200 million people. There are 7 million expats. Assume for a minute that every single one of those is supporting a family of 5/6. That's 50 million people being supported by foreign money - what about the rest? How much money do you think the labourers in the gulf make?

You talk about 20,000Rs for cleaners and 500Rs for day labourers, but what will that buy you? A days wage in the UK will earn you enough to buy a shopping basket of groceries to live off for a week. Will Rs600 do that?

My family are from a rural background in AJK. They do okay because my father sent back a lot of money over the years and bought farmland, built homes, built shops. Even then for big medical expenses they rely on my cousins who work abroad to send money home. In our village there are people who don't have that support and they still live in homes made from mud. People provided them sadqa to help them build more rooms with bricks instead of mud. In AJK 95% of people who don't have someone abroad are in the same position. That is poverty.

Look at the average height of our country has decreased since the 50's. Our nutritional intake is low, all stats point to the same thing. Every single statistic cannot be wrong.

You guys who live in the big cities have a very skewed outlook. You're truly blessed.

Saien im from balochistan.. i know about poverty more than you..

I dont shy away from reality... but eveb world bank puts the percentage around 17% not 30% as per the author..

There is unimaginable poverty.. yes, ive seen it.. and it gutts me.. but there isnt that much poverty in Pak as compared to other SA countries.

---

Also my view is skewed by my limited exposure to Pakistan too. I only know a handful of people who've managed to be successful living in the part of Pakistan i am familiar too. Clearly this is not the case everywhere. Some parts have great wealth. I've mentioned this story before that i started following a guy from twitter on snapchat because he is really funny. His videos were quite cool (travel concerts etc), i assumed he was a tourist and then had gone back to the US. One day he posted a traffic update for Karachi and it clicked that his videos were not from life in the US, they were of his life in Pakistan, in Karachi! He's no wadera ka beta (as far as i know), but i was astonished at how nice and modern some peoples lives are in Karachi!

You guys should travel to AJK to see the contrast. The only nice things are the expat villas and our cars.

And you think Kashmir is poor?

Ive been to Mirpuri,Muzafarabad,Rawlakot,Balakot.

You want to see poverty?

Visit kharan,turbat,awaran etc

Or even in panjab.. set foot in areas like pindi bhattian,lyah etc..

Or southern panjab. Or interior sindh.

 

[313ghazi]

You're right. Fact is none of the kanjar in charge ever change anything.