Over the last decade, Pakistan’s poverty headcount has witnessed a persistent decline, both at national and regional levels. The percentage of people living below poverty line has declined from 50.4% in 2005-06 to 24.3% in 2015-16, according to Pakistan Economic Survey 2017-18.
Poverty in both rural and urban areas has been declining with a poverty headcount of 12.5% in Urban and 30.7% in rural areas in 2015-16.
The decline is more pronounced in urban areas than rural areas. Reasons for this decline include:
- Targeted poverty reduction programmes like BISP,
- Relative political stability,
- Peace and tranquility,
- Strong recovery from low GDP growth rate of 1.7% in 2008-09 to 4.5% in 2015-16,
- Continued higher inflows of remittances especially from the Middle East which reach relatively poor families,
- More inclusive characteristics of economic growth.
Declining trends are shared at national as well as urban and rural areas. The largest percentage decline in poverty headcount was observed in the year 2013-14, when it dropped by 6.8 percentage points – with 6.2 percentage points decline in Urban and 7.5 percentage points in rural areas.
Poverty headcount has declined by 5.7 percentage points in urban areas and 4.9 percentage points in rural areas between 2014 and 2016, thereby leading to an overall decline of 5.2 percentage points decline in the incidence of poverty.