The recent World Bank report on the rising poverty rate in Pakistan is a matter of serious concern for every Pakistani. According to the report, poverty in Pakistan has increased significantly during 2025-26 and poverty rate has risen to 29 percent, compared to 22 percent in 2019. This represents an increase of 7 percent over the past few years and millions of families losing their ability to afford basic necessities of life. These figures are not merely part of an economic report, they reflect reality of a society where wealth and resources are limited in few hands, while ordinary citizens struggle to afford two meals a day, their children’s education, healthcare and housing. According to World Bank, major reasons behind rising poverty in Pakistan include persistent inflation over the past few years, unequal income distribution, declining purchasing power, economic instability and limited employment opportunities. The alarming aspect is that poverty is no longer confined to rural areas or low-income groups. The middle and lower-income classes in urban areas are also facing severe financial difficulties. Families that once managed to live respectable lives on limited incomes are now struggling to meet the rising costs of electricity, gas, petrol, groceries, children’s school fees, house rent and medical treatment. Many are being forced to spend their lifetime savings or borrow money simply to meet their daily expenses.
A review of Pakistan’s economic history over the past two decades reveals that poverty reduction that governments have introduced various initiatives and made numerous promises to reduce poverty. However, dream of sustainable economic growth and genuine public prosperity has remained unfulfilled. The poverty rate stood at 22 percent in 2018-19, but COVID-19 pandemic, the devastating floods of 2022, continuous depreciation of rupee, political and economic instability, uncertainty, rising energy prices and alarming inflation have broken the back of a common man. These factors have not only pushed the already poor further into poverty but have also weakened the financial position of the middle class. According to available statistics, by 2025, more than 72.6 million people in Pakistan were living below the poverty line, earning less than three dollars a day. This means that approximately every fourth person in Pakistan is struggling to survive below the poverty threshold.
One of the fundamental reasons behind spread of poverty in Pakistan is the unequal distribution of income and resources. The issue is not simply how much the national economy is growing or how much the country’s overall income is increasing. The real question is: which segments of society are benefiting from this economic growth. If national wealth increases but the major share of its benefits remains concentrated among a handful of business groups, influential individuals and the elite, such growth will have little impact on the lives of ordinary citizens. Economic growth can only be considered genuine progress when its benefits reach all segments of society. Unfortunately, Pakistan’s taxation system is also contributing significantly to economic inequality. On the one hand, the salaried class bears the burden of direct income taxes as well as indirect taxes on everyday consumer goods, electricity, gas and petrol. On the other hand, influential and elite groups continue to enjoy tax concessions, exemptions and various financial privileges from the government. As a result, the burden of taxation is not distributed fairly across society.
A large proportion of Pakistan’s population consists of young people. They are the country’s most valuable asset and the driving force behind its future development. However, limited employment opportunities, lack of quality education and inadequate technical and vocational training have made their future increasingly uncertain. Even highly educated young people are struggling to find suitable jobs, while many others are choosing to move abroad in search of better opportunities and a brighter future. According to World Bank, more than 3.5 million young people in Pakistan require employment every year, but country’s economy is unable to generate a sufficient number of jobs to accommodate them.
Pakistan today stands at a critical economic crossroads. We must decide whether we want to continue sinking deeper into the swamp of poverty by protecting interests and privileges of influential and elite groups and maintaining an unjust economic structure, or whether we are prepared to change our priorities and lay the foundations of a fair, productive and people-friendly economic system. We must acknowledge the fact that poverty is not merely the failure of an individual; it is also a reflection of weaknesses in the state’s economic and social structure. Pakistan needs an economic model in which the benefits of development are not reflected merely in national financial statistics but are visible in the kitchen of an ordinary household, in children’s education, in access to medical treatment, in fair wages for workers and in employment opportunities for young people. If poverty continues to rise despite repeated claims of economic progress, then economic development remains nothing more than an illusion. The true success of any country is not measured by the growing wealth of its richest citizens but by the prosperity and well-being of its poorest people.
