Poverty up in Balochistan and rural Sindh, down in Punjab, NWFP: World Bank

[Naveed Yaseen]

Mehtab Haider
The World Bank (WB) has estimated that the incidence of poverty substantially increased in rural Sindh and Balochistan while it decreased in Punjab and rural NWFP, the latest findings of the WB available with ‘The News’ reveal.

The results showed that poverty substantially increased during Musharraf-Aziz regime in last eight years in Balochistan. The rural poverty in Balochistan was 21.1% in 1998-99, which jumped up to 56.6% in 2005-06, witnessing an upsurge by around 200%.

By using different methodology based on Survey Based Price Index (SBPI), the WB estimates that the poverty level stood at 28.8 per cent in 2005-06 from 29.2 per cent in 2004-05 against official poverty figure of 22.3 per cent in 2005-06, which was actually calculated by the government on CPI based inflation. In 2005-06, the official urban poverty at national level stood at 13.1% while rural poverty 27%.

The WB has validated the latest official poverty figures of 22.3 per cent at national level in 2005-06 from 23.9% in 2004-05, registering a decline by 1.6 percentage points.

Balochistan is the major victim of poverty both in rural as well as urban areas as in one year the poverty almost doubled by 2005-06 compared to 2004-05.

The WB, the sources said, is engaged with Pakistani authorities to release the data of the latest poverty survey to independent economists and academicians for conducting in-depth analysis.

The WB’s working paper, submitted to the government of Pakistan and exclusively available with this scribe, reveals that poverty in Punjab stood at 12.1% in urban areas and 21% in rural areas by 2005-06 against 16.8% in urban and 28.4% in rural areas by 2004-05, indicating significant reduction in prevalence of poverty in one year period.

The poverty in urban Sindh stood at 11.5% in 2005-06 against 10.8% by 2004-05, showing nominal increase in incidence of poverty. However, in rural Sindh poverty increased substantially as it was 22.7% in 2004-05, which jumped up to 31% in 2005-06, showing an increase of 8.3 per cent in one year.

In urban NWFP, poverty slightly increased as it went up to 23.6% in 2005-06 against 22.1% in 2004-05. Poverty in NWFP rural decreased substantially as it was 34.5% in 2004-05, which declined to 28% in 2005-06.

Poverty in Balochistan increased both in rural as well as urban areas in 2005-06. Poverty in urban Balochistan stood at 17.9% in 2004-05, which increased sharply to 32.4% in 2005-06. In rural areas poverty stood at 28.7% 2004-05, which increased to 56.6% in 2005-06, registering an increase of 97%.

The WB team, the working paper states, endorses the official estimates of 2005-06. The team found that the official poverty estimates of 2005-06 followed the official methodology accurately. The team could also validate the reliability of estimates after various sensitivity analyses. The main finding is that the poverty estimates at the national level declined slightly between 2004-05 and 2005-06, but the reduction is not statistically significant.

The World Bank is currently preparing a new poverty assessment, which will further deepen the analysis conducted in the context of this validation exercise and include more detailed poverty diagnostics to understand the status of the poor in a comprehensive manner.

The WB says that Pakistan Social & Living Standard Measurement (PSLM) survey 2005-06 might not be the best dataset to assess some recent economic issues particularly high inflation in food and fuel prices.

The survey was conducted three years ago and the economic and social circumstances might have changed significantly since then.

Also 2005-06, the WB says, was a year during which the economy was growing at a reasonably high rate and the inflation was not accelerating at the current pace. While projections about the impact of high inflation on the poor can be done PSLM 2005-06, PSLM 2007-08, would be the best database for the analysis.

http://www.thenews.com.pk/daily_detail.asp?id=124802