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June '06: Poor or not?

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Poor or not?
(June 2006)
The month of June spells budget for Pakistanis. The government of the day annually in June declares that the budget is a ``poor friendly" one while the opposition of the day declares that the ``poor are being crushed" Both are extreme positions. For it's June individu-spotlight, Individualland attempts to focuses on some of ``pro-poor" steps that are being discussed to tackle poverty in Pakistan.

The luxurious racing car, Porsche entered the Pakistani market during the financial year 2005-06.There are to date forty lucky owners of the car who cruise around on the streets of Pakistan. When they stop at a traffic light and are surrounded by beggars begging for alms is the glass window the only divider between the two faces of citizens of Pakistan? Certainly not.

The face of Pakistan standing out in the sun begging for attention is separated from the Porsche owner by growing unemployment rates, growing desperation to feed themselves and their children, growing desperation to educate their children, cloth them, provide them clean drinking water and keep them from disease and want. In Pakistan, according to some figures forty eight million people live on US $2 a day. Thirty to thirty five Pakistani women die every day from pregnancy related complications which are exacerbated by them not getting timely medical attention .Pakistan is ranked 142 on the Human Development Index and approximately nine million children do not attend school. According to the World Bank, 32.6% of the Pakistani population is poor.

While the 'haves' talk about the telecommunications sector boom & sport I-mates & blue-berrys there are thirty five thousand villages of the country without electricity .Readers would recall that a couple of weeks back this very newspaper profiled Quaid-e-Azam Colony in urban Rawalpindi who has been waiting for electricity for the last fifty eight years. One can't help but recall scenes from the Swadesh movie where Shahrukh Khan helps villagers to get electricity. When will that happen for Pakistan?

Newspapers occasionally carry reports about suicides committed because of poverty. According to the World Health Organization, approximately one million people commit suicide annually across the globe of which ten percent occur in South Asia. Pakistan is amongst three countries in Asia that have literacy rates under 40 %.It is also tragic that Pakistan is at the bottom of education ranking in South Asian countries with an adult illiteracy rate of about 56% and the lowest net primary enrollment rate in South Asia of 46%.The primary reason for such dismal figures is the poverty that envelopes the children. They would rather eat than learn.

Against this backdrop, citizens are told that the economy is at a 'take off stage' & our 'macro economic indicators' have improved on the Mushraff -Shaukat Aziz watch. This might well be true .The exchange rate has remained fairly stable and our external debt was reduced during FY 2005-6 by $589 million .In 2005 ,a growth of 7.5 % in agriculture was the highest for a decade as a result of record growth in cotton production but it slowed down in the first half of 2006.Output of cotton, according to Asian Development Outlook 2006, in FY 2006 declined by an estimated 10.9% from an all time high of 14.6 million bales harvested in 2005.Production of sugarcane is also estimated lower than last year. According to ADB, inflation increased in the financial year after five years of stability. Annual inflation based on the consumer price index more than doubled to 9.3% from 4.6% mainly because of high food prices and rising housing rents. Since oil price also increased, transportation costs also were hiked up .In a nutshell, when oil & transportation costs increase prices of all daily use items like vegetables etc increase thereby increasing the toll on the consumer's already strained pocket. The poverty level increased from 30.6 in the 90s to over 34% presently according to modest estimates. In other words, while we may have a long way on macro indicators from the 90s, the poor in this country are getting poorer.

At a recent conference on economic freedom in Pakistan at Islamabad the Minister of State for Finance Mr. Omar Ayub Khan very articulately talked about the growth in macro economic indicators. After he finished an elderly gentleman got up to say,' Honorable Minister !I am very pleased to hear about how well Pakistan is doing but tell me Sir why can't I put sugar in my tea now?' This is the question that Pakistanis are asking.

Amidst all this, we hear of the poverty reduction plans of the government in conjunction with international groups and non governmental organizations. Google the key words poverty alleviation and Pakistan and a number of pages are identified each highlighting one fascinating project or the other. We are told about the Pakistan Poverty Alleviation Fund with a resource base of over five hundred million dollars, about efforts to alleviate poverty through micro credit schemes, about projects of the Khusali Bank to mention a few. Recently, the President has also reportedly directed, the government to concentrate all resources on making a visible improvement in the life of the common man' All the poverty alleviation projects are designed to do that. This is where the problem lies.

Poverty was and is being tackled piecemeal .Poverty alleviation is being 'tackled' not addressed. Poverty will be alleviated not through fancy projects but through mundane processes. The process has to include job creation. The State Bank of Pakistan has itself admitted that the biggest challenge in this process is to 'create as many jobs as possible in the short term' the process has to include transparency and abolishing monopolies that exploit citizens. It is all very well to pay lip service to poverty but another thing to support and be a part of the politically well connected sugar mafia that drives up prices. The process has to include effective governance. It is all very well to declare an increase in Public Sector Development Program but a tragedy when the existing amount is not utilized because of red tapism & cumbersome procedures. The process has to be effective .It is all very well to have a zakat fund but it is tragic when zakat committees swindle money meant for the deserving. The process has to include innovative thinking geared towards encouraging entrepreneurship so that income is generated. The process must be based on practical effective deliverance. It is all very well to declare that the Millennium Development Goals which include eradication of poverty will be addressed by local governments including Citizens Community Boards but tragic when CCBs do not exist and their funds not utilized .

Lastly and most importantly, the process of poverty alleviation must include the people.



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