The economic crisis in Pakistan is deepening, with a 29% poverty rate and a 27-year high in income inequality, according to an official survey. This is a stark contrast to the 21.9% poverty rate in 2019, with an estimated 70 million people now living in extreme poverty. The report highlights the devastating impact of the economic downturn, with a 12% decline in real monthly household income over seven years, while expenses only fell by 5.4%. The situation is particularly dire in rural areas, where poverty has risen from 28.2% to 36.2%, and in urban areas, where poverty has increased from 11% to 17.4%. The minister acknowledges that stabilisation policies linked to the International Monetary Fund programme have contributed to hardship, citing subsidy withdrawals and currency devaluation that fuelled inflation. Natural disasters and weak growth were also factors. The country now faces a 21-year-high unemployment rate of 7.1%, alongside record inequality and an 11-year peak in poverty. The minister stresses the need for growth and wealth creation, rather than cash transfers under the Benazir Income Support Programme, which are not the solution. He also rules out an early exit from the IMF programme, while expressing hope that sustained employment growth and income recovery will reduce poverty.
