WB poverty report
According to latest annual report of the World Bank, the share of people living in extreme poverty around the globe has declined, but it is falling at a slower pace in Sub- Saharan Africa. The percentage of people living in extreme poverty fell to a new low of 10 percent in 2015 - the latest year for which the data was available - down from 11 percent in 2013, reflecting some progress. The number of people living on less than dollar 1.90 per day, the threshold of extreme poverty, fell during this period by 68 million to 736 million globally. Importantly, more than a billion people have lifted themselves out of extreme poverty over the last 35 years and the present poverty rate is lower than it has ever been in the recorded history.
The data on poverty in Pakistan isinadequate and not in consonance with the international standards. The method to counter poverty is also direct and not in line with the international standards to reduce poverty through increased investment and creating more opportunities for employment. According to the latest Economic Survey 2017- 18, the proportion of population living below the national poverty line was 29.5 percent in 2014- 15 which was targeted to be reduced to 9.0 percent by 2030 while proportion of resources allocated by the government directly for poverty reduction programmes was 42.2 percent in 2014- 15 and projected to be enhanced to 43.5 percent by 2030.
Social Safety Nets Programmes ( SSNP) was the main vehicle to reach the poor and disadvantaged groups through redistribution of resources with basic objective of reducing poverty. Budgeted SSNP include BISP, Pakistan Bait- ul- Mal, Social Security and Zakat, EOBI, Workers' Welfare Fund while Pakistan Poverty Alleviation Fund and Microfinance through specialized institutions were the non- budgetary parts of the programmes. A National Framework was also devised for Sustainable Development Goals ( SDGs) at district level and implementing the global agenda to ensure inclusivity and sustainability to achieve the SDG goals to join upper middle class countries by 2030.
The World Bank report shows very clearly that though the progress on overall global poverty reduction has been commendable, this progress has been mainly limited to developed countries and emerging market economies. The developing countries, particularly located in the Sub- Saharan region, have not been able to gain this advantage. This is obvious from the fact that while global poverty was 10 percent of the population, poverty in Sub- Saharan Africa was still as high as 41 percent. This uneven progress was a matter of great concern as more of the world's poor become concentrated in a region beset by conflicts and the effects of climate change. Also, the Sub- Saharan countries have suffered more from a combination of lower growth and highly capital intensive industries that do not create much employment.
The policymakers in Pakistan have fixed very ambitious targets to reduce the poverty rate from about 30 percent to 9 percent in the next decade which is not likely to be achieved, given the poor saving and investment rate, political instability, aid fatigue in donor countries and a host of other inhibiting factors. Moreover, the method of tackling poverty in our country is flawed. Instead of reducing poverty through increased economic activity and creation of more employment, the government seems to have relied mainly on direct grants like Zakat, Bait- ul- Mal and BISP for poverty reduction which could expand the class of hangers- on who will not be willing to work but will develop the habit of living on the dole. Lastly, Pakistan must stick to international definition of poverty. It is no use underestimating the level of poverty when its signs are visible everywhere. Also, it is better to recognize the extent of the problem if we want to resolve it.