World Bank reports shows increase in Pakistan's poverty rate

The World Bank has released its latest report on Pakistan’s economy, drawing attention to several pressing issues, including a significant rise in poverty and persistent economic challenges.

According to the report, poverty levels in Pakistan have shown an upward trend, with the poverty rate increasing from 40.2% in 2023 to 40.5% in 2024.

The steady rise signals growing hardships for the country’s most vulnerable populations, especially as economic conditions continue to deteriorate.

One of the report's major concerns is the rising cost of electricity. It states that the price of electricity in Pakistan currently exceeds its actual production cost, placing an extra financial burden on consumers.

Shockingly, 20% of the subsidy intended to alleviate energy costs is instead being passed on to the public, further straining household budgets in a country already grappling with inflation and other economic pressures.

The World Bank also cast doubt on Pakistan's economic growth potential in addressing poverty. Despite moderate growth, it is insufficient to bring down the poverty rate.

The report underscores that Pakistan’s population growth rate is outstripping economic growth, creating a widening gap between the resources available and the needs of the population. This imbalance hampers the country’s ability to create jobs, improve living standards, and reduce poverty.

Looking ahead, the World Bank’s projections for Pakistan’s economic indicators in 2024 are modest. It forecasts a GDP growth rate of 2.8% for the year, which remains sluggish compared to the needs of the growing population.