Rising poverty

Rise in food prices amid growing unemployment since has pushed another 10% Pakistanis into poverty

The reigning coronavirus pandemic, coupled with the recent locust attacks and the devastating monsoon rains across the country, threaten to drag more and more Pakistanis down the poverty line over the next two years. A recent World Bank report forecasts an ‘anaemic’ economic outlook for Pakistan, with growth rate reaching just 0.5% during the ongoing fiscal year, from the negative 0.38% during FY20 and 1.9% in FY19. The report, titled South Asia Economic Focus, sees bleak prospects of economic recovery all across the region.

The World Bank forecast of half a percentage point economic growth rate for Pakistan is far below the projections made by the Asian Development Bank some three weeks back. While estimating the impact of the coronavirus-induced lockdown on the economic activity in the country, the ADB had forecast a 2% growth rate during the ongoing fiscal year. The ADB forecast coincides with the growth rate expectations that the incumbent government has had, based on the steps it has taken to revive the economic activity in the country.

However, the uncertainty regarding the Covid-19 pandemic that rages on in much of the world, especially in Europe and America, puts the economic projections in doubt. Apprehensions of a surge in the cases of the infection in coming months — which could trigger a new wave of lockdowns, both in Pakistan and globally — may hamper steps aimed at economic recovery, besides further delaying the implementation of critical structural reforms. The economic outlook thus remains murky, as also pointed out in the World Bank report.

To renowned economist Dr Hafeez Pasha, rising inflation is bigger a worry than the falling growth rate. He claims that the rise in food prices amid growing unemployment since the emergence of Covid-19 has pushed another 10% Pakistanis into poverty. Time for the government to be proactive and innovative.

 

Published in The Express Tribune, October 12^th, 2020.

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