Pakistan is grappling with a surge in poverty levels, as per the latest data from the Social Policy and Development Centre (SPDC), indicating a poverty rate of 43.5%. This figure starkly contrasts with the 28.9% reported by the Pakistan Bureau of Statistics (PBS) based on the Household Integrated Economic Survey 2024-25, as highlighted in a Business Recorder report. The discrepancy in figures primarily arises from differing methodologies employed by SPDC and PBS.
SPDC’s approach involves assessing minimum calorie requirements for sustenance to determine household expenditure levels necessary to meet these needs. In contrast, PBS updates the poverty line using the Consumer Price Index (CPI) without recalculating it based on fresh household data. The World Bank has also adopted a similar methodology to SPDC, estimating Pakistan’s poverty rate at 42.4% for 2025, considering a $3.65 per day threshold adjusted for 2017 purchasing power parity.
The increase in poverty levels since 2020, as noted by the World Bank, is attributed to multiple economic crises, escalating inflation, and weakened purchasing power. Additionally, a population growth rate of approximately 2% has led to nearly 1.9 million more individuals falling below the poverty line in the previous fiscal year. SPDC has expressed reservations about PBS’s CPI-based methodology, emphasizing that it fails to capture regional disparities, especially in remote areas, and neglects essential expenses like informal healthcare and access to clean water for low-income households.
The International Monetary Fund (IMF) has also raised concerns about data quality in Pakistan. In its December 2024 loan approval documents, the IMF highlighted significant data deficiencies in sectors contributing to a substantial portion of Pakistan’s GDP, along with issues related to the accuracy and granularity of government finance statistics. Consequently, the IMF has provided technical support to PBS to develop a new Producer Price Index and commence major surveys to enhance data quality ahead of the National Accounts rebasing exercise slated for completion by June 2026.
