Poverty estimates: considerable controversy

Just like strategies for combating poverty, poverty estimates have also been embroiled in a considerable controversy in Pakistan.
It will come as no surprise that lack of reliable estimates and differences in calculation methodologies are the major stumbling block in depicting the true picture of poverty.
On top of that, the government has also failed to provide poverty estimates for the last two years, leaving analysts and economist with outdated figures, which point out a decelerating trend in poverty in the past decade till 2007-08.
For instance, the portion of population earning below $1.25 a day fell to 22.6 percent in 2004-05 from 35.9 percent in 2001-02 according to the World Bank. Similarly, a few estimates show that poverty at national level declined sharply to 17.2 percent in 2007-08.
Though, poverty levels might have declined during the period on the back of economic growth, it is quite likely that this trend has been reverted since the onset of the 2008 financial crisis due to double digit inflation, high unemployment rates and weak growth rates.
Moreover, other signs pointing towards a surge in poverty are waning security conditions, spiralling terrorism, energy shortage, higher interest rates and removal of subsidies under the tutelage of the IMF.
Moreover, ADB in its report Summary poverty reduction and social strategy issued last year, has shown concern regarding high food and energy prices in Pakistan and speculated that the poverty level has increased during 2008-09, adding that 20 percent increase in food prices alone leads to an 8 percent increase in poverty headcounts.
Moreover, Maplecroft, a UK based risk advisory business, ranked Pakistan 11th on the food security risk index out of 148 countries last year, citing that the country is in the extreme risk category.
Non availability of current surveys and documentation will also dampen the positive impact of poverty support programmes as it is widely believed that large numbers of intelligible persons are getting assistance through these schemes at the cost of deserving population.
To fight poverty it is also necessary to look for ways to support microfinance, as it will not only generate income but will also create employment opportunities in the society. Besides, authorities also need to ramp up infrastructure spending as it will directly benefit masses by reducing the cost of utilities and transportation.