Federal Minister for Planning, Development and Special Initiatives Professor Ahsan Iqbal on Wednesday said Pakistan’s poverty reduction momentum had suffered a serious setback following 2018, as political instability, discontinuity in development policies, economic crises, the COVID-19 pandemic and devastating floods undermined earlier gains and constrained the country’s capacity to invest in its people.
Addressing a high-level event titled “Pathways to a Poverty-Free Pakistan: Advancing Multidimensional Poverty Measurement for Evidence-Based Policy and Action,” attended by Professor Sabina Alkire, Director of the Oxford Poverty and Human Development Initiative (OPHI), University of Oxford, along with senior government officials, development partners, researchers and academics, the Minister outlined a renewed national agenda to move beyond measuring poverty towards targeted public investment and sustainable poverty reduction.
Highlighting Pakistan’s poverty trajectory, Professor Iqbal recalled that during the PML-N government’s 2013–18 tenure, economic growth, development investment and human development were central priorities under Vision 2025. National monetary poverty declined from 29.5 percent in 2013–14 to 24.3 percent in 2015–16, with the downward trend continuing to 21.9 percent in 2018–19.
However, the latest official estimates show that poverty increased to 28.9 percent in 2024–25, reflecting a substantial reversal in Pakistan’s earlier progress.
The Minister attributed the loss of development momentum to political uncertainty, interrupted policy continuity, the COVID-19 pandemic, devastating climate disasters and severe macroeconomic pressures, including the threat of financial default faced by Pakistan in 2022.
He emphasised that political stability, sustained economic growth and continuity of national development priorities were essential to restoring poverty reduction.
Drawing attention to the shrinking fiscal space for public investment, Professor Iqbal pointed out that Pakistan’s federal Public Sector Development Programme (PSDP) had reached Rs 1,001 billion in 2017–18, accounting for approximately 19.6 percent of the federal budget and 2.5 percent of GDP.
In contrast, the federal PSDP allocation for 2026–27 stands at approximately Rs 1 trillion, almost unchanged in nominal terms despite the substantial increase in population, prices and development requirements over the intervening years.
He observed that, had the 2017–18 share of the federal budget been maintained, the development programme would today exceed Rs 3 trillion, illustrating the scale of development investment capacity that Pakistan has been unable to sustain.
The Minister warned that shrinking public investment had serious consequences for education, healthcare, water security, infrastructure, skills development and economic opportunities, particularly in disadvantaged regions.
Turning to Pakistan’s institutional framework, Professor Iqbal called for completing the process of devolution initiated under the 18th Constitutional Amendment, observing that while major social-sector responsibilities and financial resources had been transferred to the provinces, the corresponding improvements in human-development outcomes had remained inadequate.
He noted that under the 7th National Finance Commission Award, provinces received 57.5 percent of the federal divisible pool, alongside primary responsibility for major social sectors, including education, healthcare and social welfare.
However, he expressed concern that the expanded provincial fiscal space had not consistently translated into the scale of investment and improvement in essential public services required to address Pakistan’s development challenges.
The Minister also highlighted the absence of sufficiently empowered local governments as a major structural weakness in the country’s service-delivery system.
He said meaningful implementation of Article 140A required the transfer of political, administrative and financial authority to elected local governments, supported by functioning Provincial Finance Commissions and transparent, needs-based resource allocations.
He stressed that the effectiveness of devolution must ultimately be judged by improvements in schools, healthcare facilities, water supply, sanitation and other services available to citizens.
Recalling Pakistan’s longstanding partnership with Oxford, Professor Iqbal said that during his earlier tenure as Planning Minister, Pakistan launched its first National Multidimensional Poverty Index (MPI) in 2016 in collaboration with OPHI and UNDP.
The initiative marked an important advance in poverty measurement by examining overlapping deprivations in education, health and living standards rather than relying exclusively on monetary poverty estimates.
He noted that MPI evidence subsequently helped identify Pakistan’s 20 poorest districts—11 in Balochistan, five in Sindh, three in Khyber Pakhtunkhwa and one in Punjab—providing the basis for a targeted development initiative under the federal PSDP.
Professor Iqbal said the Government now intends to build on that experience through the proposed National MPI 2027, supported by renewed collaboration with OPHI, the Pakistan Bureau of Statistics and relevant development partners.
The updated national poverty measurement exercise will draw upon the ongoing Pakistan Social and Living Standards Measurement Survey 2026–27 and examine the relevance of emerging development challenges, including climate vulnerability, insecurity, youth deprivation, gender inequality, digital exclusion, early childhood development, nutrition, stunting and migration.
He emphasised that new indicators and complementary thematic studies must be supported by reliable data and sound methodology to preserve the credibility and policy relevance of the national measure.
A significant component of the renewed collaboration will involve exploring multidimensional poverty analysis at the National and Provincial Assembly constituency levels, using data from the 2023 Population and Housing Census.
The Minister said that more geographically disaggregated evidence could help elected representatives understand development gaps within their constituencies, strengthen public accountability and generate greater political consensus around social investment.
He further emphasised the need to integrate multidimensional poverty evidence into federal and provincial development planning, the prioritisation of PSDP investments, social protection programmes and mechanisms for monitoring development outcomes.
The Minister called upon the Planning Commission, PBS, BISP, PIDE, provincial planning departments, academia and development partners to work towards a coordinated, evidence-driven approach to poverty reduction.
He said OPHI’s international experience could play an important role in helping Pakistan translate poverty measurement into practical policy interventions, particularly in development planning, resource allocation, social protection targeting and sustainable graduation from poverty.
The proposed collaboration includes updating the National MPI, developing constituency-level poverty analysis, examining the relationship between monetary and multidimensional poverty using household survey data, strengthening institutional technical capacity and promoting the policy use of poverty evidence.
Professor Iqbal emphasised that Pakistan’s renewed poverty reduction agenda under URAAN Pakistan must combine macroeconomic stability with sustained human-development investment, stronger institutional accountability and a commitment to equal opportunities for citizens regardless of their geographical or socioeconomic circumstances.
He reiterated that the ultimate success of development policy should be measured not merely by public expenditure or the completion of projects, but by tangible improvements in education, health, livelihoods and the ability of families to escape multidimensional poverty.
