Poverty on the rise

Source: Dawn

Date: 04 Oct, 2010

A HIGHER gross domestic production growth is helpful but not sufficient to bring down the poverty level. It must be accompanied by allocation of bigger resources for poverty alleviation, social safety nets, education, health, sanitation and housing for the poor. 

Nevertheless, the higher GDP growth leads to employment generation and puts more revenue in the hands of the government, enabling it to allocate more resources for poverty alleviation. 

In addition to lower GDP growth, increase in unemployment also pushes up the poverty level. In Pakistan, the unemployment rate went up to 5.5 in 2008-09 from 5.2 per cent in 2007-08. For 2009-10, the unemployment figures are not available. However the floods have swept away thousands of jobs in the affected areas. As a result of job losses, poverty in the post-flood area has become a nightmare.

Last but not the least, higher inflation – particularly higher food inflation – makes the lives of the poor unbearable. Even before the floods, prices of food items had increased manifold over the last couple of years. To quote a few instances, wheat flour (average quality) had gone up from Rs13.64 per kg. in 2006-07 to Rs29.05 per kg. in 2009-10 or by 113 per cent. Price of sugar (open market) went up from Rs31.85 per kg. to Rs56.25 per kg. or by 77 per cent, while price of vegetable ghee (loose) had gone up from Rs70.81 per kg. to Rs111.27 per kg. or by 57 per cent in the same period, as reported in the Economic Survey 2010.

For details view the link: http://www.dawn.com/wps/wcm/connect/dawn-content-library/dawn/in-paper-magazine/economic-and-business/poverty-on-the-rise-400