Countries and Regions

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p. 3 of 25 BACK | NEXT I. Country Performance Assessment A. Economic Performance Assessment B. Poverty Assessment C. Assessment of Socio-Environmental Performance D. Governance: Sound Development Management E. Implementation Assessment II. Country Operational Strategy III. Sector Strategies IV. Regional Cooperation V. Donor Activities and Aid Coordination VI. Cofinancing and Catalyzing External Resources VII. ADB’s Operational Program VIII. Economic and Sector Work Program IX. Local Cost Financing

Country Assistance Plans - Pakistan : I. Country Performance Assessment

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B. Poverty Assessment

10. Although some progress was made in reducing poverty during the 1970s and 1980s, approximately 33 percent of the population is still poor, when compared to either income or calorie-intake based poverty lines. The incidence of poverty has been increasing through the 1990s, especially in recent years due to the slowdown in economic growth, and continuing high population growth rate (2.3 percent, 1999). Some 70-80 percent of the poor lives in rural areas. Their lower standard of living is mainly due to high rates of underemployment, inadequate socio-physical infrastructure, and insufficient income generating assets. A more reliable national picture is emerging from the final results of the 1998 census and other assessments, and the final results are expected by late 2000.

11. Given the strong linkages between poverty and low human development in Pakistan, the Government sees the provision of basic social services in education, nutrition, health, and population planning as key elements of poverty reduction. The Social Action Program (SAP) is an important cornerstone in the fight against poverty to address poor social indicators, taking a multi-sector approach to improving the provision of basic services, e.g., education, health, rural water supply and sanitation. Participatory area-based rural development programs, including development of rural infrastructure, microfinance, and employment generation have also become important elements. The Pakistan Poverty Alleviation Fund (PPAF), established in 1997 with the support of the World Bank, has recently started lending activities. It finances microenterprises and infrastructure projects at the community level mainly through NGOs and the private sector.

12. The Government's new poverty reduction strategy is currently under preparation and finalization is expected in the next few months. The main elements of the strategy to date include: (i) an economic growth strategy that would result in expanded domestic demand while protecting the gains made through ongoing structural reform programs; (ii) productive employment through labour intensive activities; (iii) expanded resource availability and increased efficiency of resource utilization for social development; (iv) expanded access to microfinance and skills development services through grassroots organizations such as NGOs, community based organizations (CBOs) and village organizations; (v) use of existing social safety nets⁴, and food stamp schemes; (vi) focus on gender issues, especially improving the nutrition of women and children; (vii) promotion of environmental awareness and enforcement of standards; (viii) targeted interventions and areas to be determined and implemented through the Provincial Governments; (ix) infrastructure programs (e.g. farm to market roads, water sector improvements, small town renewal and soil conservation) to provide income earning opportunities for the poor; and (x) governance improvements and institutional reforms. From a base year of FY1998/99, targets are being adopted for the subsequent ten years. They will cover the incidence of poverty, access to basic education, basic health, nutrition, population growth, and rural water supply and sanitation. The incidence of poverty, for example, is to be reduced (on a calorie-based measure) from an average level of 32.6 percent of the population in FY1998/99 to a target level of 15.2 percent by FY2007/08. The Government intends to conduct regular monitoring of quantitative targets.

13. Poverty in Pakistan is the root cause of child labor. The International Labour Organization (ILO) estimates that there are 10 to 12 million children under the age of 15 working in Pakistan in the rural and urban sectors. Children are employed in private homes, brick kilns, carpet manufacturing, workshops, restaurants and farms. While laws against child labor exist⁵, enforcement and monitoring are weak. The Government has signed a Memorandum of Understanding with the ILO to strengthen the institutional capability of the country to reduce child labor. NGOs are increasingly involved in designing innovative solutions to the child labor problem⁶ that recognize that many children work out of economic necessity. The German NGO, Care and Fair, builds and maintains schools and runs medical centers for the children and families of child laborers working in carpet-making. The Lahore-based NGO, Network for Community Empowerment, has established schools for children working in factories. Each factory or workshop owner sponsors at least five children. The ILO has also started an education program for children working in the soccer ball industry. This program includes providing education to the children involved and replacing child workers with older family members. Independent bodies including trade unions will monitor it. UNICEF, Save the Children and the ILO are involved in the program in which 55 sporting goods companies are participating.

14. The ADB plans to monitor the incidence of child labor under the SSTA supporting the implementation of the ADB-financed Trade, Export Promotion and Industry (TEPI) Program⁷ - "Monitoring the Socioeconomic Impact of the TEPI⁸. A new TA in the 2000 program to promote NGO-Government collaboration may also offer opportunities to help reduce child labor. Similarly, a proposed rural development project for Sindh (2001), will examine the issue of bonded labour.

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