Pakistan - Poverty and wealth

A third of the population of Pakistan lives below the poverty line (34 percent in 1991). While the lowest 10 percent of the population has a share of only 4.1 percent

GDP per Capita (US$)
Country 1975 1980 1985 1990 1998
Pakistan 274 318 385 448 511
United States 19,364 21,529 23,200 25,363 29,683
China 138 168 261 349 727
India 222 231 270 331 444
SOURCE: United Nations. Human Development Report 2000; Trends in human development and per capita income.

in the overall household income and consumption, the richest 10 percent of the population has a share of 27.6 percent. The slowdown of economic growth in recent years has resulted in an increase in the incidence of poverty in the 1990s. Thus, there is a compelling need for a clear strategy focusing on reviving and sustaining high economic growth in a stable macroeconomic environment (i.e. low fiscal and external deficits with single digit inflation). It includes the provision of quality basic social services—particularly education, health, and drinking water—and an efficient and responsive social safety net program for the very poor. Low inflation in the prices of food and other mass consumption goods are also very important for the welfare of the poor.

Pakistan's human development indicators, especially those for women, fall significantly below those of countries with comparable levels of per-capita income. Only 40 percent of the population is literate (28 percent of women), compared with 49 percent in South Asia and 53 percent in low-income countries. About two-fifths of the population has no access to safe drinking water, and more than half has no access to sanitation. The infant mortality rate of 88 per 1,000 live births is higher than the average of 73 in South Asian countries and 83 for low-income countries. Pakistan's population growth rate of 2.6 percent remains among the highest in the world and frustrates efforts to increase the coverage of social services.

Distribution of Income or Consumption by Percentage Share: Pakistan
Lowest 10% 4.1
Lowest 20% 9.5
Second 20% 12.9
Third 20% 16.0
Fourth 20% 20.5
Highest 20% 41.1
Highest 10% 27.6
Survey year: 1996-97
Note: This information refers to expenditure shares by percentiles of the population and is ranked by per capita expenditure.
SOURCE: 2000 World Development Indicators [CD-ROM].

Household Consumption in PPP Terms
Country All food Clothing and footwear Fuel and power a Health care b Education b Transport & Communications Other
Pakistan 45 7 19 6 5 7 11
United States 13 9 9 4 6 8 51
India N/A N/A N/A N/A N/A N/A N/A
Afghanistan N/A N/A N/A N/A N/A N/A N/A
Data represent percentage of consumption in PPP terms.
a Excludes energy used for transport.
b Includes government and private expenditures.
SOURCE: World Bank. World Development Indicators 2000.

To address these problems, the government initiated a Social Action Plan (SAP) in 1993. Increasingly, the design and implementation of social service programs involve active participation from communities and nongovernmental organizations (NGOs). To make further progress in the social sectors, the second phase of the SAP was initiated in 1997-98. A key part of the poverty reduction strategy is the provision of adequate basic social services—particularly elementary education and basic health services—to a much higher proportion of the poor. Only through better education and improved health can the life-long earning capacity of the poor be enhanced.

Pakistan is a major transit and consumer country for opiates (opium, heroin, morphine) from neighboring Afghanistan, the world's largest producer of opium. In 2000, Afghanistan cultivated 82,000 hectares of opium poppies, yielding 3,275 metric tons of fresh opium. As a result of the high levels of opium production in the region over the past 2 decades, Pakistan now has one the highest addiction rates in the world. Drug addiction is a common reason for the incidence of poverty for individuals and families. A recent shift to injecting heroin instead of smoking or sniffing it has heightened fears of an HIV/AIDS epidemic.

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