POVERTY provides a lucrative business opportunity in Pakistan. Will the budget 2014-15 promote it? Probably yes, as there is nothing to suggest otherwise.
Like before, the upcoming budget is likely to be loaded with promises for the people on the street and actions tilted to suit the interests of the urban elite — the perceived constituency of the ruling PML-N.
Successive governments have sold images of vulnerable communities in shanty townships, swamped with half-clothed underfed children and makeshift camps to foreign donors. They develop fancy reports and strategies to qualify for liberal credit from foreign lenders.
To capitalise on the trust deficit the state suffers from its poor service delivery, enterprising individuals — under different brands of non-government organisations (NGOs) and community-based organisations (CBOs) — compete for funds to improve access to social amenities like health and education of the poor.
In 2014, a year before the MDG programme closes, the poverty rate in the country, as projected by independent think-tanks, is estimated to be between 30-35pc
It would be wrong to paint all NGOs with the same brush — as Edhi, Kashaf, Aman, Citizen Foundation etc. command respect for their work — or vilify all different pro-poor government initiatives (the Benazir Income Support Programme is a case in point). But there is no point in understating the fact that only a small fraction of resources acquired in the name of the underprivileged reach the target beneficiaries.
The numbers speak for themselves. Forget the distant past; since 2000, according to an estimate, at least $20 billion have landed in Pakistan from varied sources for poverty reduction programmes. These resources were accessed by both state and non-state actors to address the multiple dimensions of poverty, hunger, education, health, gender inequality and environmental degradation.
In September 2000, Pakistan pledged at the UN General Assembly to bring extreme poverty down to 16pc by 2015 — half of 32pc in 1995. The country developed the ‘Poverty Reduction Framework’ paper with clearly identified benchmarks.
In 2014, a year before the programme closes next year, the poverty rate in the country, as projected by independent think-tanks, is estimated to be between 30-35pc. Some experts believe the poverty rate is either stagnant at the 1995 level, or has actually worsened in the recent past.
“The liberal fund inflows must have benefitted many, but certainly not those who were targeted, at least not in a decisive manner,” an economist commented.
Ambassador Masood Khan, Pakistan’s permanent representative to the UN, told Dawn over telephone from his office in New York that it is more difficult for the country’s diplomats to deal with reports of violence, particularly against women and minorities, than its weak MDG performance.
“The country is in a state of war and has endured major natural disasters during the past decade,” he said, referring to earthquake and floods. “The international community is understanding and more hopeful about the future of Pakistan than it was ever before,” he told this writer, while avoiding a direct reply on the country’s performance on the millennium development goals (MDGs).
Shahid Javed Burki, a retired World Bank Vice President, believes the poverty rate is much less than 35pc, and income disparity much more than the projected level.
“My guess is that poverty incidence in Pakistan falls in the range of 25-28pc. Sadly, it is still higher than the target of 16pc. The poverty numbers are disturbing, but rising income disparity can prove to be crippling for the country.
“The government must address the issue in the budget by strengthening its role in regulating economic activities efficiently. It must announce and effectively implement policies that lead to more equitable distribution of wealth if it wishes to put the economy on a sustainable growth trajectory,” he says.
“Pakistan dropped the idea of assessing and reporting poverty and income inequality on the national or provincial scale, for the data was found to be too embarrassing for those vested with the responsibility of governance. If the media raised the issue, it was dubbed ‘obsessed with poverty, conservative, anti-business and left-leaning,” said a poverty expert, who was shunted out after the closure of the Poverty Reduction Cell in the ministry of finance.
“There is nothing to suggest that the economic team understands the inverse relationship between poverty and sustainable development, or that it intends to tinker with the elitist power structure at this point,” commented another expert.
“In Pakistan, the top 1pc has captured the state. The real rich in the country do not know the real poor. For them, they are lazy people. They do not see the value of equal economic opportunities for all,” commented another expert on Pakistan in the US.
“Nawaz Sharif trusts the market and the corporate sector a bit too much. I hope he strengthens the government to enable it to deliver on its responsibility of offering people an opportunity to lead productive, decent lives,” Burki summed it up.
The writer is on a visit to New York
Published in Dawn, Economic & Business, June 2nd, 2014