ISLAMABAD: The federal government has blamed the International Monetary Fund (IMF) for cutbacks in social services and phasing out of food subsidies, admitting that Pakistan has dropped seven places in the Human Development Index (HDI), ranking 161 out of 192 countries worldwide.
“Pakistan has remained prone to series of challenges, that is economic crises, political instability, natural calamities (floods, pests’ attacks, earthquakes) etc which exacerbate the vulnerabilities of the poor segments.
Furthermore, the process of structural adjustment under the IMF programme to stabilize the economy through steep reductions in fiscal and current account deficits has caused tax hikes (especially on consumption), cutbacks in public expenditure (particularly on development and social services) and the phasing out of food subsidies (for example, on wheat). It has led to depreciation in the exchange rate and enhanced tariffs on public utilities such as power and gas.
All these adjustments reduce economic opportunities and increase the cost of living which further lower the living standards of poor people,“ stated the Economic Survey 2022-23 released by the Finance Ministry on Thursday.
Due to high vulnerability to climate change, Pakistan has experienced devastating calamity in monsoon 2022 caused by the heavy rainfall and flash flooding that have severely affected one-third of the country, taken the lives of more than 1,700 people, nearly eight million people have reportedly been displaced and 33 million people have been affected according to Post-Disaster Needs Assessment Report of the 2022 floods, the Survey adds.
The floods of 2022 have caused a significant loss to poverty reduction efforts and would result in increase in poverty and vulnerability of affected population who live below or just around the national poverty line, the Survey contends adding that preliminary estimates suggest that as a direct consequence of the floods, the national poverty rate may increase by3.7 to 4 percentage points, potentially pushing between 8.4 and 9.1 million more people into poverty.
According to the Economy Survey, the “depth and severity of poverty will increase for households that were already poor prior to the floods.
The catastrophic floods of 2022 further intensified the situation led to a huge loss of Rs 3.3 trillion ($15.2 billion) and cost of recovery and rehabilitation is estimated at Rs 3.5 trillion ($16.3 billion),“ claiming that “in response, the government has taken adequate steps to provide health facilities in flood affected communities by providing shelter, safe drinking water, food items as well as health interventions amidst supply chain disruptions.
The government provided flood relief assistance of Rs 70 billion to 2.8 million beneficiaries under BISP (Benazir Income Support Programme). The compensated amount of Rs 25,000 has been provided to each flood-affected family to help them recover from their financial losses.“
It cites the report of the Human Development Report (HDR) 2022 which maintains that Pakistan has dropped seven places in the HDI, ranking 161 out of 192 countries which put the country in the ‘Low Human Development’ category.
Compared to Pakistan, India has dropped one spot to 132 in the HDI. According to the report, life expectancy at birth in Pakistan stood at 66.1 years, expected years of schooling are 8.7 years, while the gross per capita national income is $4,624.
Life expectancy at birth in India is 67.2 years, expected years of schooling are 11.9 years, while the gross per capita national income is $6,590. Bangladesh stands at 129 in the index. Life expectancy at birth in Bangladesh is 72.4 years, expected years of schooling are 12.4 years, while the gross per capita national income is $5,472 respectively.
Copyright Business Recorder, 2023