About half of the rural population in Pakistan experienced poverty during the last decade, said the Pakistan Institute of Development Economics (PIDE) in its latest Viewpoint series titled, “Rural Poverty Dynamics in Pakistan” launched on Wednesday.
PIDE launched this report on the signing ceremony of the Memorandum of Understanding (MoU) between PIDE and Pakistan Poverty Alleviation Fund (PPAF).
The MoU was aimed at institutional collaboration with PPAF regarding short term internship opportunities for students of PIDE, by enabling sharing of research, trainings and knowledge through library exchanges and borrowings. The report said that a large proportion of the population lived around the poverty line. While speaking on the occasion, PIDE Vice Chancellor Dr Rashid Amjad said that this report would help policymakers understand the dynamics of poverty in Pakistan.
He was of the opinion that poverty alleviation strategies should focus on addressing the unemployment of working age population and minimizing shocks from natural disasters and economic recession. PPAF Chief Executive Officer Qazi Azmat Isa was of the opinion that this agreement would strengthen both institutions in analyzing poverty and addressing it through concrete actions.
The PIDE Viewpoint posits that the poverty debate overlooks the dynamism of poverty in the country as it focuses only on its levels and trends. According to the PIDE’s Pakistan Panel Household Survey (PPHS) that covered the same rural households in its three rounds conducted in 2001, 2004 and 2010, poverty reduction has not been sustainable in Pakistan and shows wide fluctuations in its distribution. A large proportion of the population lives around the poverty line and is very sensitive to any micro and/or macro shocks (positive or negative), which pushes it into poverty or pulls it out of it. This dynamism of poverty, however, has been overlooked in the cross-sectional datasets around which the poverty debate in the country mainly revolves. Cross-sectional datasets, like the HIES carried out by the Pakistan Bureau of Statistics, no doubt contribute towards monitoring the progress in poverty reduction overtime but such static measures of households’ standard of living do not necessarily provide a good insight into their likely stability overtime. The PIDE Viewpoint suggests that the poverty reduction trends in the past show a high mobility of population into or out of poverty in rural Pakistan. This mobility leads to a higher proportion of population experiencing poverty over time than what the cross-sectional data might suggest. However, it is not all gloom and doom as the analysis also shows that a much smaller proportion of the population, fewer than five percent, experiences chronic poverty, that is remains poor for a long period of time. Thus, an analysis of the poverty dynamics is important to uncover the true nature of the well-being of the population.
