KEY POINTS
- World Bank says Pakistan cut poverty by over 40 percentage points since 2001
- Compounding shocks slowed progress, but resilience and data-driven reforms can restore trajectory
- Report stresses investment in people, women, and youth as key to growth
- Pakistan retains strong institutional partnerships and financing support from World Bank Group
ISLAMABAD: Pakistan has the capacity to restore its strong record of poverty reduction by focusing on people-centred reforms, according to a new World Bank report released on Tuesday in Islamabad.
The study, Reclaiming Momentum Towards Prosperity: Pakistan’s Poverty, Equity and Resilience Assessment, highlights that Pakistan reduced poverty from 64.3 per cent in 2001-02 to 21.9 per cent, in 2018-19, one of the sharpest declines in South Asia.
According to ‘The World Bank study’, this was achieved through household income growth, urbanisation, and shifts from agricultural to service-based employment, showing the country’s ability to deliver results when structural reforms align with opportunity.
“Pakistan’s hard-won gains can and must be protected,” said Bolormaa Amgaabazar, World Bank Country Director for Pakistan. She stressed that renewed reforms could “expand jobs and opportunities—especially for women and young people—while building resilience against shocks.”
External shocks hurt movementum
The report acknowledges that since 2020, multiple external shocks—including COVID-19, global inflation, historic floods, and macroeconomic pressures—have temporarily slowed progress.
However, the World Bank emphasised that Pakistan’s reform capacity, strong demographic base, and institutional partnerships position it to reverse the recent poverty uptick and place growth back on track.
Christina Wieser, Senior Economist and lead author of the report, said reforms “that expand access to quality services, protect households from shocks, and create better jobs—especially for the bottom 40 per cent—are essential to break cycles of poverty and deliver durable, inclusive growth.”
Reform path ahead
The report outlines four key reform pathways: Investing in people, places, and opportunities by tackling human capital gaps in health, education, housing, water, and sanitation.
Building household resilience through responsive and inclusive safety nets. Adopting progressive fiscal measures by improving municipal finance, phasing out inefficient subsidies, and targeting resources where they are most needed.
And last but not least, developing timely data systems for governance improvement, resource targeting, and policy results.
Youthful workforce
Despite persistent rural-urban disparities and challenges in service delivery, Pakistan retains a youthful workforce and untapped potential in women’s participation—key levers, the report says, could transform poverty reduction into sustainable prosperity.
The World Bank also underlined its long-term partnership with Pakistan. Since 1950, Pakistan has received over $48.3 billion in assistance, with a current portfolio of 54 projects valued at $15.7 billion.
In addition, the International Finance Corporation (IFC) has invested nearly $13 billion across sectors, including renewable energy, financial inclusion, agribusiness, and manufacturing, demonstrating continued international confidence in Pakistan’s economic trajectory.
The report concludes that with bold, sustained, and people-centred reforms, Pakistan can not only regain but accelerate its poverty reduction momentum, translating resilience into inclusive growth that protects its most vulnerable citizens.
