Poverty in Pakistan explodes, inequality at highest level in 27 years as economic crisis deepens | World News – The Times of India

Poverty in Pakistan has risen to an 11-year high of 29%, while income inequality has reached a 27-year high, according to an official survey released on Friday by Planning Minister Ahsan Iqbal. The report estimates that about 70 million people now live in extreme poverty, defined by a monthly threshold of Rs8,484 required to meet basic needs, The Express Tribune reported.The preliminary findings for the fiscal year 2024-2025 show that the poverty rate rose sharply from 21.9% in 2019 to 28.9% during the first year of the current government of Prime Minister Shehbaz Sharif. This is the highest since 2014, when it was 29.5%. Inequality also rose to 32.7, the highest level since 1998.The country now faces a 21-year high unemployment rate of 7.1%, alongside record inequality and an 11-year spike in poverty. The minister acknowledged that stabilization policies linked to the International Monetary Fund program contributed to the hardships, citing the withdrawal of subsidies and currency devaluation fueling inflation. Natural disasters and weak growth were also factors, he said.Rural poverty rose from 28.2% to 36.2%, while urban poverty rose from 11% to 17.4%. Provincial data showed similar trends, with Punjab’s percentage increasing from 16.5% to 23.3%, Sindh’s from 24.5% to 32.6%, Khyber-Pakhtunkhwa’s from 28.7% to 35.3% and Balochistan’s from 42% to 47%. Security challenges in Khyber Pakhtunkhwa and Balochistan “disrupt livelihoods, limit access to markets and essential services and increase household vulnerability,” the report said.Real monthly household income fell 12% to Rs31,127 in seven years, while real expenditure fell 5.4%, reflecting inflation that exceeded nominal income. “Nominal income growth was outpaced by inflation, causing real incomes to fall, according to the study.”Iqbal was quoted by The Express Tribune as saying: “The journey to economic progress was first disrupted in 2018 and in 2022, consumption-led economic growth caused the economy to crash the following year.” He added that cash transfers under the Benazir Income Support Program “are not the solution”, stressing the need for growth and wealth creation.Responding to criticism of PML-N policies, he said it would take three years to reverse the effects of Pakistan Tehreek-e-Insaf’s decisions and ruled out an early exit from the IMF programme, while expressing hope that sustainable employment growth and income recovery would reduce poverty.