Official Data Reveals Sharp Six-Year Deterioration
Pakistan’s national poverty rate has surged to 28.8% for the fiscal year 2024-25, marking a significant reversal of previous progress and placing over a quarter of the population below the poverty line. The latest estimates, derived from the Household Integrated Economic Survey (HIES) 2024-25, indicate a 6.9 percentage point increase from the 21.9% rate recorded in 2018-19.
A Nationwide Reversal of Fortune
The increase is widespread, with poverty rising across provinces, particularly in Punjab and Sindh. Balochistan witnessed a slight rise, while Khyber Pakhtunkhwa also saw an increase. This trend marks a stark departure from the preceding years, where poverty had shown a consistent decline from 50.4% in 2005-06 to the 2018-19 low.
Official sources cited a confluence of severe economic shocks as the primary drivers:
- Three consecutive IMF stabilization programs.
- The lingering economic effects of the Covid-19 pandemic.
- Global commodity super-cycles and soaring domestic inflation.
- Lower GDP growth rates.
- The devastation of two super floods.
- The abandonment of wheat support prices.
Methodology and Official Release
The government employs the Cost of Basic Needs (CBN) approach, adjusted for Consumer Price Index (CPI) inflation, to determine the poverty threshold. A 17-member high-powered Poverty Estimation Committee, chaired by former PIDE Joint Director Dr. G. M. Arif, submitted its recommendations based on the HIES data.
Federal Minister for Planning Ahsan Iqbal is expected to formally release the official poverty figures. The government is also preparing to release the latest Labour Force Survey, which will provide further context on employment and economic participation.
Historical Context and Urban-Rural Divide
The recent surge interrupts a nearly 15-year period of poverty reduction. In 2018-19, the urban poverty headcount was 11%, with rural poverty at 28.2%. The new data suggests a substantial erosion of these gains across both demographics.
The shift to the CBN methodology was undertaken with consultation from World Bank poverty measurement experts, aiming for a more accurate assessment of basic living costs. The current figures underscore the severe economic pressures facing Pakistani households, reversing a long-term positive trend and presenting a major policy challenge for the government.
