POVERTY

In 2018, an estimated 8.6 percent of the world’s population was living in extreme poverty.

If you make more than $34,000 a year, you are among the world’s richest.

Children are more than twice as likely as adults to live in extreme poverty.

What is Poverty?

Poverty what is poverty? The word ‘poverty’ derived from the Latin word pauper, which means poor.
Poverty is a global phenomenon that is characterized by the lack of resources such as clean water,
nutrition, health care, clothing etc. or less income than others are within a society or country for basic
survival. Moreover, poverty could also be deprivation of non-tangible goods such as citizenship, lack of
their right and feeling a sense of inferiority. People in poverty typically experience persistent hunger or
starvation, inadequate or absent education and health care and are usually alienated (feel disconnected
from the norms, values and social relations of their community) from mainstream society. Sociologists,
economists and philosophers view poverty differently from each other but in my view it cannot be
described, it can only be felt. The ILO Declaration of Philadelphia, 1944 states, “Poverty anywhere is a
threat to prosperity everywhere.” Poverty is a consequence of the uneven distribution of basic
resources and wealth on a global scale and within nations, which breeds to unbridled crimes, frustration,
bribery, injustice, malnutrition and moral degradation. However, it is a fundamental responsibility of a
country and its government to fulfill the basic needs of its people, which as mentioned before comprises
of shelter, food and clothing. When these basic needs are not fulfilled, they bring about consequences
termed as socio-economic problems. The real issue is not the presence of these problems in the society
but to what extent they are paid attention and being solved. When these problems are not met timely
they result in the form of drug abuse, deviant behavior, smuggling, poverty, corruption and many other
social evils arising in the society. A.P.J Abdul Kalam stated, “Almost half of the population of the world
lives in rural regions and mostly in a state of poverty. Such inequalities in human development have
been one of the primary reasons for unrest and, in some parts of the world, even violence.”

Dimensions of poverty:

Poverty itself has many dimensions, which include economic, political, social and human dimensions. In
economic terms, poverty means not possessing or having access to or power over resources that can be
used to sustain a better living standard. It is when a country or household is poor when the per capita
income of purchasing power of a poor country or household is below a certain minimum standard, there
are low health and medical facilities, productivity is very low and there is illiteracy. In political terms
poverty means being poor through lack of power and voice in the community, which relates to people’s
ability to articulate their concerns, needs and rights in an informed way and to take part in decision
making affecting these concerns. These people depend on other more powerful groups or indicators in
order to express their own rights and choices. In social terms, poverty in a country or household breeds
all types of social evils and unacceptable behaviors like crime, drug addiction, violence and even
terrorism in a family or community. These factors degrade human self-respect, moral and social values
of the society as a whole becoming rude towards other people in the community. Poverty in terms of
human dimension is because poor people live in conditions that are miserable, conditions in which some
members of their family die due to hunger, starvation, disease of famine. Poverty in this dimension
exists when a child is suffering from a curable disease but due to the lack of purchasing power, the
parents have to take decision whether to spend on expensive medicines or purchase other essentials of
daily use. It exists when parents of a sell their child into slavery or prostitution because of lack of
resources to feed their family and when the government fails to protect the rights of the poor and
needy. Poverty is a curse in Pakistan for the indigent or poor. Pakistan being a developing country is
facing a crisis of poverty. Most of its population lives in adverse circumstances. The magnitude and
extent of poverty in any country depends upon two factors, which are the average level of national
income, and degree of inequality in its distribution. Here the income means the minimum income
required to purchase those items that are essential for a person for reasonable living. Pakistan,
however, is a classical testing ground to measure such a phenomenon where there is a level of
inequality in economic means of living, a rapidly increasing population where there are more mouths to
feed than there are hands to earn. One's income is limited, as he cannot afford to maintain a large
family. Moreover, an economy with a high rate of inflation and unemployment gives birth to poverty.
Unemployment and Poverty are in correlation:

The Loss of Income:

The obvious, straightforward answer of how unemployment creates poverty is through the loss of
income. With joblessness comes a loss of income, and many families are left without sufficient incomes
to meet living expenses. This can lead to indebtedness from borrowing money to support one’s needs,
use of savings or even to homelessness and malnutrition if individuals are unable to find other sources
of finance.

When individuals are forced to use savings to cover costs today, their future retirement funds are
reduced. This creates negative long-term effects on the economy such as high levels of youth
unemployment around the world. Youth unemployment today will decrease the incomes of future
retirees and increase the burden on the government.

Long-term Unemployment:

In 2019, the unemployment rate in Pakistan was at approximately 4.45 percent, a slight increase from
4.08 percent the previous year.

A high unemployment rate usually indicates economic troubles, with a popular example being Greece,
where the unemployment rate skyrocketed from 7.76 percent in 2008 to 27.5 percent because of the
Great Recession.

Once individuals are unemployed, the risk of falling into long-term unemployment rises. It has been
found that the characteristics of living in poor neighborhoods create a poverty trap , as families do not
have the necessary tools to become employed.

When living in impoverished areas individuals experience low-quality housing, underfunded schools and
restricted access to public transportation and services. These outcomes reduce an individual’s chances
of finding employment again

In The World Employment Report 2001 the World Health Organization (WHO, 2001) estimated that
globally “at the end of 2000 some 160 million workers are unemployed, most of them first-time job-
seekers,” about two-thirds of these in the so-called “developing” world. In addition, the WHO estimated
that “about 500 million workers are unable to earn enough to keep their families above the US– 1 -a-day
poverty line. These are almost entirely in the developing world. And of the workers who are not among
the poor, many lack basic job and income security.” The situation appears to be deteriorating.

Statistics:

The compilation of statistics of the past few years is from reliable studies that are as follows;

There was a consistent decline in poverty in Pakistan over the 14 years from 2001 to 2015, once the
deprivation headcount was measured using the national poverty level fell from 64.3% to 24.3%, the rise
in a job opportunities outside the agriculture sector was the most driver of financial condition reduction
over this era. There are two self-reinforcing economic dynamics accounted for the ascertained progress
in poverty reduction: (i) the enlargement of economic opportunities outside the agriculture sector,
significantly with growth in male off-farm employment; and (ii) the rise in emigration and associated
remittances. The latter not solely boosted consumption of recipient households however, additionally
fueled internal demand of products and services regionally created within the informal sector and the
increase in real wages. However, since 2015, the pace of poverty reduction is probably going to be
halted because of the political economic crisis and slowdown in growth. Recently, the outbreak of the
recent COVID’19 pandemic and the containment measures adopted by the government are expected to
extend poverty.

UNDP in its Human Development Report -2008 places Pakistan at 136th position, 13 among 177
developing countries in the world. The country hosts over 2.4 million Afghan refugees. Numerous types
of poverty prevail in Pakistan and over 73% of the population lives on less than US$2 per day. Pakistan,
once measured on income poverty, is classified below all Central Asian States and even South Asian
states.

Pakistan’s Planning Commission (2011),has evaluated that in 2007 there has been 35.5 million people
living below the poverty line however, in 2010 their range accrued to over 64 million.
According to the 2011 statistics of the World Bank, due to the global financial recession poverty ratio
has increased especially in the USA and the EU countries have pushed unaccountable millions of people
around the world into deeper impoverishment. Almost 40% of 107 developing countries are extremely
exposed to poverty. Pakistan is ranked among the

43 countries who are most exposed to poverty.

A study in 2012 on poverty has brought Pakistan face to face with a reality that it will find onerous to
accept. Each third Pakistani is caught in the ‘poor’ bracket i.e. some 58.7 million out of a complete
population of 180 million exist below the poverty line. This includes more than half the population
within the remote Baluchistan, 33% in Sindh, 32% in Khyber Pakhtunkhwa and 19% in Punjab. These are
alarming figures however; they are much needed for planning, particularly once the government seems
too embarrassed to unleash the statistics associated with poverty.

However, the biggest proportion fall in poverty count was witnessed within the year 2013-14 when
national poverty headcount decreased by 6.8% points with 6.2% points fall in urban and 7.5 % in rural
areas. In addition, poverty headcount has exhibited a fall of 5.7% points in urban areas and 4.9% points
in rural areas throughout the period 2014-2016, contributing to an overall fall of 5.2% points in the
incidence of national poverty headcount.

The Economic Survey 2018 disclosed Pakistan’s percentage of individuals living below the poverty line
has fallen at each regional and national level with poverty in rural and urban areas to 24.3 % in 2015-16
from 50.4% in 2005-06.

At the end of 2 years of the Pakistan Tehreek-e-Insaf (PTI) government, 18 million additional people may
slip into abject poorness due to low economic growth and food inflation, claimed by Dr Hafiz A Pasha,
the country’s illustrious economist expert. The national poverty proportion, which was 31.3% in June
2018, would sharply increase to over 40% by June 2020, said Pasha in an article that first appeared in
Business Recorder. In absolute terms, people living in poverty will increase from 69 million in June 2018
to 87 million by June 2020, indicating a 26% increase in poverty or an addition of 18 million people
within the initial 2 years of the PTI government.

Causes of Poverty:

A number of factors explain the existence of an increase in poverty in the last decade, which are in
detailed account below.

A sensible governance is taken into account to be non-existent in Islamic Republic of Pakistan and poor
governance is taken as one amongst the key underlying causes of impoverishment/poverty in Pakistan.
Poor governance has not solely increased vulnerability, but is the prime explanation for low business
confidence, that successively interprets into lower investment levels and growth. The results of poor
governance serve to bolster the adverse impact of structural factors. The existence of pervasive
impoverishment, whereby a major proportion of the population remains poor over an associate degree
extended amount of your time is powerfully coupled with the power of the govt. to make sure sensible
governance. Beset with the threat of coercion that is wearing away the terrible foundations of the state,
Government’s target the topic is blurred. Governance downside has additionally resulted in inefficiency
in provision of social services that has had serious implications for human development within the
country. Resultantly, lack of public confidence in state establishments, together with the police and
judiciary, have worn their legitimacy and directly contributed to worsening conditions of security and
law and order throughout the past decade.

Economic factors have additionally contributed in creating life troublesome for all sections of society
except the terribly made. Decline within the Gross Domestic Product (GDP) rate is the immediate reason
behind the rise in poverty. Consistent with the newest information discharged by the State Bank, GDP is
unlikely to grow by quite 2% this year. The rupee has underact by quite 30% against the USA since the
beginning of 2009 and share costs have crashed by 40% since their incomparable high in April. Most of
the inflows apart from employee remittances were nearly dried up. By the end of October 2008
destroyed by political instability and arduous hit by ever-deepening world monetary crisis Pakistan was
at the verge of bankruptcy. The country’s foreign reserves had fled out of the country and around $4.5
billion were left behind to procure solely six weeks of imports. Once failing from getting funds from
China, Saudi Arabia and alternative Friends of Pakistan, we have a tendency to be affected to bow
before the International Monetary Fund for help. The International Monetary Fund's first tranche of
$3.1 billion helped Pakistan to stabilize its foreign reserve to fulfill the imports bill. The strings connected
with these bitter pills such as; associate degree finish to cost subsidies, tighter financial policy and other
austerity measures would lead to further price hike and squeeze the already meager share of public
spending. Last quarter of 2008 Pakistan was virtually facing a worst socio-economic crisis that include
food and energy shortages, escalating fuel costs, a sinking currency and a massive flight of foreign
capital accelerated by an escalating insurgency. The burgeoning debt burden is worsening the economic
condition resulting in growing fiscal squeeze.

Political stability is prime to the creation of sanctioning atmosphere for growth and development.
Economic agents, significantly investors, should be confident with reference to the continuation of
policies, ought to believe within the government’s quality to work effectively, and within the case of
investors, be induced to require risks. The perceived security threat on eastern border that has
dominated Pakistan’s political culture has resulted within the domination of the military in politics,
excessive public disbursal on defense at the expense of social sectors, and erosion of the rule of law.
Politically, Pakistan has alternated with regularity between democratic and military governments. All of
these factors have successively affected growth, and afterwards poorness levels within the country. In
general, political instability and economic science imbalances are mirrored in poor trustiness ratings
even compared to alternative countries of comparable financial gain levels, with ensuing capital flight
and lower foreign direct investments flows.

The country’s education indicators portray a dismal image when put next with alternative countries at
the similar level of Gross domestic product per capita. Additionally, the general public expenditure on
education as percent of value is around 2% in Pakistan compared to alternative (low-income) countries
of the region. Since, the foundation of any development in socio-economic sector is corollary to the
amount of education/skills of its human capital, general perception that one among the most causes of
the poorness in Pakistan is a pitiable state of education across the country. Over 1/2 the population
cannot read and write and a substantial variety of individuals do not have any conception concerning
modern learning techniques. The majority of people are unable to adopt technology to reinforce
agriculture/ business yield thereby ending up way below the productivity targets and revenue decline.
Resultantly, decrease in revenue leads the society to poor monetary conditions and deed no space for
allocating adequate funds for the education sector. The persistent refrain has been that Pakistan
devotes but 2% of its annual GDP to education whereas most alternative countries even in South Asia,
apportion at least 3% to 7%.Because, over the past 15 years, the proportion of the population living
under extreme poverty in Pakistan has risen from 13% to 33% but illiteracy has declined during this
period.

The existence of pervasive poverty, whereby a big proportion of the population remains poor over an
extended amount of your time is powerfully coupled with the structure of society. Cultivated land is very
unevenly distributed in Pakistan about 47% of the farms square measure smaller than two hectares,
accounting for less than 12% of the completely cultivated space. Access to land, that is, the basic issue of
production, is crucial to reduce poverty in rural areas. Pervasive difference in land possession intensifies
the degree of vulnerability of the poorest sections of rural society, because of the consequences of
associate unequal land distribution do not seem to be restricted to regulate over assets. The structure of
rural society, in areas wherever land possession is very unequal, tends to be powerfully stratified, with
giant landowners or social group chiefs physical exertion considerable management over the selections,
personal and otherwise, of individuals living within the space below their influence, also as over their
access to social infrastructure facilities.

Environmental degradation is additionally a reason for economic condition in Pakistan. The environment
poverty nexus manifests itself most notably in health effects such as waterborne diseases are
widespread because of 17% of the urban and 40% of the agricultural population does not have access to
scrub water. The poor conjointly tend to be additional liable to the results of air and water pollution,
each in rural and concrete areas, given their restricted access to quality health care. The prevalence of
sickness exacerbates poverty foremost by compelling the poor to devote ever-increasing proportions of
their restricted financial gain to health prices, and second by reducing productivity.

Poverty and Donations:

Pakistan is a generous country, and it contributes more than one per cent of its GDP to charity, the
Stanford Social Innovation Review reported.
The contributions push it into the ranks of far wealthier countries like the United Kingdom (1.3 per cent
GDP to charity) and Canada (1.2 per cent of GDP), and stand around twice what India gives to those in
need as a percentage of its GDP.

A study conducted by Pakistan Centre for Philanthropy shows that Pakistanis give around Rs240 billion
(more than $2 billion) annually to charity.

The report indicates that about 98 per cent of people in the country give in one form or another - if not
with cash, then with in-kind donations or by volunteering for needy causes.

Even small donations have an impact.

When considering poverty in the developing world, many people feel deep sorrow but conclude that
there is nothing we can do. The scale of poverty is immense and we seem powerless to stop it. Such
despair is understandable, but the facts tell a very different story. While poverty is indeed extreme and
widespread, it is easy to forget just how many people there are in the developed world, and how
powerful our pocket change can become when pooled together.

When giving to an effective charity, the size of your donation directly correlates with the number of
people you are able to help. However, you do not have to be a millionaire to make a significant
difference

Giving benefits the world’s neediest people.

There are hundreds of non-profits that you can choose to give to, and the process of selecting which
organization to support can feel like a daunting task. However, you do not have to do all the research
yourself. Peter Singer personally compiles The Life You Can Save’s list of recommended charities
(below), which work in variety of crucial cause areas, based on extensive research and analysis
performed by organizations like Innovations for Poverty Action, Give Well and Giving What We Can.

Types of Poverty:-

Absolute poverty:

It is what most people probably think of when they think of poverty, which is an extreme or abject
poverty especially if they think about it at the global level. It is defined as the total lack of resources and
means required to meet the most basic standards of living, which involves the scarcity of food, clean
water, health, shelter, and education. It is characterized by a lack of access to food, clothing, and shelter.
The characteristics of this type of poverty are the same from place to place. People who tend to struggle
to live and experience many child deaths from preventable diseases like malaria, cholera and water
contamination related diseases. It is a widely used measure to ascertain poverty rates in wealthy
developed nations.

Relative Poverty:

It is defined from the social perspective that is living standard compared to the economic standards of
population living in surroundings. Hence, it is a measure of income inequality when households receive
50% less than average household incomes, so they do have some money but not enough to afford
anything above the basics. These people are not living in total poverty, but they are not enjoying the
same standard of life as everyone else in the country. For example it can be TV, internet, clean clothes,
going on vacations, a safe home (a healthy environment, free from abuse or neglect), or even education.

Cyclical/Situational:

This type of poverty is a condition in which poverty is widespread but is temporary based on occurrence
of an adverse event that disrupts a society like war, economic recession or natural phenomena or
disasters such as environmental disaster that disrupt the distribution of food, severe health problems,
job loss and other resources.

Generational Poverty:

Its handed over to individuals and families from one generation to theother. This is more complicated as
families are trapped in the cycle of poverty as they have limited or no resources. There are many
disadvantages that collectively work in a circular process making it impossible for individuals to break
the cycle of poverty.

Rural Poverty:
It occurs in rural areas with population below 50,000. It is the area where thereare less job
opportunities, less access to services, less support for disabilities and quality education opportunities.
People are tending to live mostly on the farming and other menial work available to the surroundings.
The rural poverty rate is growing and has exceeded the urban rate every year since data collection
began in the 1960s. The difference between the two poverty rates has averaged about 5 percent for the
last 30 years, with urban rates near

10–15 percent and rural rates near 15–20 percent.

Urban Poverty:

It occurs in the metropolitan areas with a population over 50,000. These are some major challenges
faced by the Urban Poor who have limited access to health and education, inadequate housing and
services, violent and unhealthy environments because of overcrowding and poor provision for
sanitation, drainage and solid waste collection.

Education reduces poverty:

 25% increase in wages later in life resulting from a single year of secondary education
 171 million people could be lifted out of extreme poverty if all children left school with basic
reading skills. That’s equivalent to a 12% drop in the world total.
 If all students in low-income countries gained basic reading skills, 171 million people could
escape poverty.
 50 m children living in conflict-affected states are unable to attend school.
 4,000 schools have either been destroyed, damaged or are being occupied by military groups in
Syria
 200 million young people leave school without skills they need to thrive
 31 million primary school aged girls are out of school
 17 million of these girls are expected to never enter a classroom.
 ¼ of young woman aged between 15 and 24 never completed primary school
 420 million people could be lifted out of poverty if all adults completed secondary education,
according to UNESCO.
 Education increases earnings by roughly 10% per each additional year of schooling. For each $1
invested in an additional year of schooling, earnings increase by $5 in low-income countries and
$2.5 in lower-middle income countries.

Education increases individual earnings

 Education increases earnings by roughly 10% per each additional year of schooling.
 For each $1 invested in an additional year of schooling earnings increase by $5 in low-income
countries and $2.5 in lower-middle income countries.

Education reduces economic inequalities

 If workers from poor and rich backgrounds received the same education, disparity between the
two in working poverty could decrease by 39%.

Education promotes economic growth

 Educational attainment explains about half of the difference in growth rates between East Asia
and Sub-Saharan Africa between 1965 and 2010.
 In 2050, GDP per capita in low-income countries would be almost 70% lower than it would be if
all children were learning.
 Increasing tertiary attainment by one year on average would increase sub-Saharan Africa’s long-
term GDP by 16%.
 Students who graduate college see a 17% increase in earnings, compared with a 7% boost for
high school grades.
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