The Mahbub ul Haq Human Development Centre was actively involved in monitoring poverty in Pakistan, as part of the UNDP’s South Asia Poverty Monitor Project. The Centre was assigned the lead role in preparing a monitor to assess, analyse and provide solutions to the poverty problem in Pakistan.
Under the Centre’s umbrella, a comprehensive report entitled ‘A Profile of Poverty in Pakistan’ was prepared with the help of leading statisticians, researchers and policy makers. The report was launched in February 1999.
The report features a comparison of several calorie- and income-based poverty measures to a new and broader Poverty of Opportunity Index, a comprehensive analysis of trends in income poverty and human development, the macro-economic factors that have determined these trends over the last two and a half decades, and the effect of government policy on poverty reduction since Independence.
Press release of A Profile of Poverty in Pakistan
Introductory statement by: Khadija Haq, President, Mahbub ul Haq Human Development Centre.
Widespread poverty remains Pakistan’s most persistent and urgent problem. Whether we define poverty using the narrow definition of lack of adequate food or income or the broader definition of lack of access to opportunities, the number of people in poverty in Pakistan falls between the range of a quarter to a half of the total population. Income poverty in Pakistan has increased from 25% in 1985 to 30% in 1995.
But for poor people, poverty means poverty of opportunity, not just poverty of income. Income poverty is only one of many deprivations. Other human deprivations include lack of education, ill health, social exclusion, discrimination on the basis of ethnicity, gender or religion and political repression. Poverty is a multi-dimensional phenomenon, not a single-dimensional issue.
Poverty of opportunity is the cause, poverty of income is the result. For policy makers, it is important to focus on strategies that address poverty of opportunity because only then the poor can be integrated into the mainstream of development. The poor must be empowered, income transfer or charity is not the lasting solution to poverty.
Pakistan’s growing poverty lies with the successive governments’ failure to translate economic growth into poverty reduction and sustainable development prospects for the poor. We can draw several lessons from Pakistan’s failure to reduce poverty even when it experienced reasonable economic growth. First, equitable patterns of growth are essential for sustained reduction of poverty. This requires a two-pronged approach consisting of broad-based economic growth across income groups and improved access to education, healthcare, family planning, sanitation, clean drinking water and micro-credit. These two elements are mutually reinforcing and should be implemented simultaneously.
Second, different strategies are required to address poverty in rural and in urban areas. Rural poverty requires more immediate attention as there are more poor people in rural areas than in urban areas. This means that the prevailing urban bias in public spending for social services has to be corrected and resources have to be redirected toward rural development and agricultural support programmes. It also means correcting gender bias in providing social service and micro-credit. But most important of all, it is essential to have meaningful land reforms and agricultural income tax. The poor must have a share in the growth of the economy.
Third, strategies should be disaggregated down to local level so that they can respond to the felt needs of a community or a village. Poverty alleviation strategies based on national data are irrelevant to the needs and concerns of poor people at the local level.
Finally, the real answer to poverty reduction lies in changing the very model of development from traditional economic growth to human development where human capabilities are built up and human opportunities enlarged, and where people become the agents and beneficiaries of economic growth. Such human development models rely on certain core strategies for poverty elimination, in particular, basic education and basic health for all, credit to the poor, women’s empowerment, land reforms, equitable growth and good governance. This is the main lesson from the experience of several countries that have substantially reduced poverty over the last two decades, including Malaysia, China, Republic of Korea and Colombia.
Press Release at the launch of the Poverty Report
Poverty rises while economic growth falls
A ground-breaking study investigates the return of poverty in Pakistan
“The poverty bomb, which was never defused in high growth periods, can easily explode in a period of slow growth, high inflation, rising unemployment, and deteriorating social services. Poverty, misgovernance, and unevenly distributed growth are today locked in a fatal embrace.”(Mahbub ul Haq) This is the sombre prophecy of a seminal study entitled ‘A Profile of Poverty in Pakistan’, prepared by the Mahbub ul Haq Centre for Human Development in collaboration with the United Nations Development Programme. The message is a timely reminder of an impending social crisis, even as euphoria over nuclear bombs today dominates national psyche. This study has been highly acclaimed by leading academics, thinkers, researchers, policy makers, and international donors.
The Study has been prepared as a part of UNDP’s South Asia Poverty Monitor Project, designed to periodically monitor poverty in the seven countries of the region. Under the direct supervision of the late Dr. Mahbub ul Haq, the then President of the Centre, a core team of four researchers prepared the study on Pakistan. The researchers were:
Dr. Pervez Tahir, Joint Chief Economist at the Planning Commission; Dr. Moazzam Mahmood, former Chief of Research at the Pakistan Institute of Development Economics; Dr. Younus Jafri, Deputy Director General at the Federal Bureau of Statistics; and Murtaza H. Syed, Senior Policy Analyst at the Mahbub ul Haq Centre.
The study presents a new approach to determining levels and trends of poverty in Pakistan.
Its main features include:
Latest poverty estimates, from 1986 to 1994, based on different definitions.
Construction of a new poverty index – poverty of opportunity – designed to capture the many dimensions of poverty.
An analysis of macro economic trends of poverty over the last three decades.
A critique of successive government plans to eradicate poverty.
Presentation of data, tables, and figures on poverty in Pakistan.
The study reaches many important conclusions:
If poverty is defined on the basis of calorie intake or income, a quarter to one-third of the population falls below the poverty line. But if we use the broader definition of poverty of opportunity, based on lack of education, health and income, about half of Pakistan’s population is below the poverty line.
After a sharp decrease during the 1980s, poverty in Pakistan has started rising during the 1990s. Rural poverty has increased at a faster rate than urban poverty.
Income inequality in the 1990s is higher than at any time in Pakistan’s history.
Of all the indicators of poverty of opportunity, education is the most pervasive in Pakistan; and women are the most deprived in all indicators.
While the achievement of high growth has always been a paramount objective of government planning in Pakistan, poverty alleviation or income redistribution have never received any serious policy attention. Strategies for poverty alleviation should focus on improving education, health and income of the poor, and targeting women in all programme designs. Helping the poor move into more formal markets (through the development of infrastructure and human development) is another component of such a strategy.