The poor of the country will have to wait their turn to a quality life, or keep fending for themselves as best they can, for the poverty alleviation efforts of the government are expected to deliver, if at all they do— after sometime.

That is a curt message contained in the following passage of the latest State Bank report: “Although the development expenditure have risen recently following the take-off of PRGF, the poverty reduction initiatives would yield definite results after a time lag”.

In the final analysis, from people perspective, the best criteria to judge efficiency of certain set of economic policy options is to evaluate them on the basis of their impact on the quality of life of the majority_ the presumed goal of development. If one were to accept this view, economic policies being pursued in the country for the last two decades have missed the target by a wide range.

In spite of the economic initiatives and programmes launched by successive governments, level of poverty has actually increased with time and the trend will persist at least in the short term.

There are more Pakistanis today living sub-human life than say in 1982 not only in absolute terms but also as a percentage of the total population.

Though the current economic document of the central bank avoided defining development in clear and simple terms, it however, did consider underdevelopment of human capital to be a ‘serious concern facing Pakistan’.

The State Bank of Pakistan’s Annual Report 2001-02 acknowledges: “While economic growth is essential for development, this is hardly an end in itself...Unfortunately social sector development has been an area of neglect by successive governments”.

Amartya Sen, winner of Nobel prize in 1998, in his book ‘Development as freedom’ discussed development as: Development requires the removal of unfreedom: poverty as well as tyranny, poor economic opportunities as well as systematic social deprivation, neglect of public facilities as well as intolerance or over activity of repressive states, the removal of substantial unfreedoms is constitutive of development”.

We may have a long way to go before ‘substantial unfreedoms’ are removed or even lessened. The fact that the SBP report considered the issue of socio-economic development important enough to merit a detailed discussion in a separate chapter is a welcome change in otherwise too technical and number-oriented an approach of most public sector institutions. It could be lack of clarity and may be it is by default that economic documents are so technical that for even literate population they are not easy to understand in most parts. It could also be so by design to mask shortcomings of certain policies. Therefore, comparatively direct treatment by the Central Bank in its Report, of issues, such as poverty, demography, employment, literacy, education and health that are closer to people’s heart is appreciable. The picture that emerges from the analysis is, to put it mildly, a dismal one.

Though the data on poverty has not been updated and figures presented are those of the year 1999—(who knows how many more millions have fallen in the poverty pit in the three years since), it has been implied that the state of deprivation in which poor people live has been accentuated: “While the limited fiscal resources constrained the government from taking pro-poor initiatives, the economic slowdown capped any notable rise in per capita income”, the report rationalises.

Analyzing the composition of poverty, the SBP report reveals that the trend was strikingly different in rural and urban areas during 1990s: “While the poverty in urban areas was declining, rural areas were facing a sharp rise in poverty incidence, thus leading to a notable jump in rural-urban gap in FY91-94. The steep rise in rural poverty appears unusual, as the agricultural sector witnessed an average annual growth of 3.6 per cent during FY91-94”.

Aside from other reasons, the report attributes higher rural poverty to, highly skewed pattern of land holdings: “While more than one-half of the rural population in Pakistan is landless, 93 per cent of total farms (covering over 60 per cent area) are smaller than the subsistence land holding of 10 hectres. The ownership is also important in determining the access to credit from the formal banking system”, says the report. It also holds the nature of contract sharecroppers biased against poor.

The report has cooped the poverty of opportunity index (POOI) developed by the Mahbub-ul-Haq Centre for Human Development.

It is a composite index of poverty that incorporates deprivation in health and education along with the income poverty. The income poverty was increasing during 1990s. However, the POOI is falling largely due to significant improvement in health.

If comparatively detailed discussion on the socio-economic indicators and their more realistic portrayal is a reflection of a more independent view taken by the bank, it certainly is a healthy sign.

It is only after reality is adjudged the way it exists that any workable solution for the change towards an improvement could be worked out.

There is also a dire need to link economic policies with their end results to put things in proper perspective.

Means should not be confused with ends. It is a healthy sign for the economy that the country has accumulated the highest ever stockpile of foreign exchange reserves, but that should not be an end in itself.

If billions of dollars that are stashed away in the central bank’s coffers and the lavish bounties showered on the country by the West, can not bring a smile of joy on the face of the poor, of what use they really are?