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Pakistan's Poverty Rate Soars to 43.5%, Far Exceeding Official Figures

A new report from the Social Policy and Development Centre estimates Pakistan's poverty rate has climbed to 43.5%, starkly contrasting the official government estimate of 28.9%. The divergence is attributed to different methodologies, with the SPDC using a calorific intake approach while the official bureau uses a CPI-updated cost of basic needs model. The World Bank's recent estimate of 42.4% poverty aligns more closely with the SPDC's findings, blaming economic crises and inflation for the increase. The International Monetary Fund has also acknowledged data quality shortcomings and is providing technical assistance to improve Pakistan's statistical systems.

Key Points: Pakistan Poverty Rate Hits 43.5% in New Report

  • Poverty rate estimated at 43.5%
  • Official stats show 28.9%
  • Methodological differences explained
  • World Bank estimate aligns at 42.4%
  • IMF notes data quality issues
2 min read

Poverty in Pakistan far higher than official data, touches 43.5 pc: Report

A new report reveals Pakistan's poverty rate is 43.5%, much higher than the official 28.9%, due to methodological differences and economic crises.

"overlapping economic crises, rising inflation, and weakened purchasing power - World Bank"

New Delhi, April 12

Pakistan is facing renewed concerns over rising poverty levels, with fresh estimates by the Social Policy and Development Centre suggesting that the country's poverty rate has climbed to 43.5 per cent, a report has said.

This figure is significantly higher than the 28.9 per cent estimated by the Pakistan Bureau of Statistics (PBS) based on the Household Integrated Economic Survey 2024-25, as per the Business Recorder report.

The divergence in estimates stems largely from differences in methodology. SPDC relies on a calorific or food energy intake approach, which measures the minimum calorie requirements for basic sustenance and calculates the level of household expenditure needed to meet those needs.

In contrast, PBS uses the cost of basic needs method, updating the poverty line through the Consumer Price Index (CPI) rather than recalculating it using fresh household data.

A similar approach to SPDC has been adopted by the World Bank, which recently estimated Pakistan's poverty rate at 42.4 per cent for 2025, based on a $3.65 per day threshold adjusted for 2017 purchasing power parity.

The World Bank attributed the increase in poverty since 2020 to overlapping economic crises, rising inflation, and weakened purchasing power.

It also highlighted that a population growth rate of around 2 per cent resulted in approximately 1.9 million additional people falling into poverty in the last fiscal year.

SPDC has raised concerns about the limitations of the CPI-based methodology used by PBS, arguing that the consumption basket primarily reflects the spending patterns of relatively better-off households.

According to the Centre, this approach overlooks regional disparities, particularly in remote areas, and fails to account for essential expenses faced by low-income households, such as informal healthcare and access to clean drinking water.

Concerns over data quality have also been acknowledged by the International Monetary Fund (IMF).

In its December 2024 loan approval documents, the IMF noted significant shortcomings in source data for sectors contributing nearly a third of Pakistan's GDP, along with issues related to the reliability and granularity of government finance statistics.

As a result, the IMF has extended technical assistance to PBS to develop a new Producer Price Index and to initiate fieldwork for major surveys ahead of the National Accounts rebasing exercise scheduled for completion by June 2026, as per the report.

- IANS

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Reader Comments

S
Sarah B
Very sad to read. Over 40% poverty is devastating for any country. The population growth adding nearly 2 million more poor people every year is a compounding crisis. They need to focus on education and job creation urgently, not just loans from IMF. The human cost is unimaginable. 😔
V
Vikram M
The report mentions regional disparities being overlooked. This is a common problem in many South Asian nations, including parts of India. Development often doesn't reach remote areas. Pakistan's situation shows what happens when economic crises, inflation, and poor governance collide. A cautionary tale for all of us.
P
Priya S
While the situation is indeed grave, we must be careful not to view this with any sense of superiority. India also has its own significant challenges with poverty and measurement. The focus should be on the technical lesson here: using the right methodology (like calorie intake) to get the true picture. Solidarity with ordinary people suffering.
R
Rohit P
When the World Bank and their own SPDC both put the figure above 40%, it's hard to trust the official 28.9%. The common man there is bearing the brunt of economic mismanagement. The IMF's technical help to fix data is a good step, but real solutions need political will. Basic needs like clean water and healthcare shouldn't be luxuries.
M
Michael C
The divergence in estimates is the real story. It shows a system failing its most vulnerable. If you don't even measure the problem correctly, you can't solve it. The calorie-based approach makes much more sense for assessing poverty. Hope the June 2026 rebasing brings some accuracy and

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