New Delhi, February 24 – While the International Monetary Fund (IMF) praises Pakistan’s aid program progress, stark data paints a grim picture of rising poverty and income inequality. A recent Dawn report reveals that despite macroeconomic improvements, millions are grappling with severe hardships, highlighting the heavy social cost of these reforms.
Fiscal balance and current account indicators show gains, yet the benefits evade ordinary citizens. After years of twin deficits, currency volatility, and dwindling reserves, even a modest primary surplus is hailed as fiscal discipline. Current account relief stems from reduced imports, higher remittances, and debt rollovers—not export growth.
Revenue shortfalls persist as a challenge, though a recent court ruling on super tax offers temporary relief. Economists urge broadening the tax base for lasting stability over one-off fixes. IMF-mandated structural reforms lag, crucial for converting short-term stability into sustainable growth.
The IMF’s governance report stresses strong institutions for economic stability. Fresh data exposes the toll: nearly 70 million Pakistanis live below the 8,484 rupees monthly poverty line, insufficient for basics. Planning Minister Ahsan Iqbal announced poverty at 29%, the highest in 11 years, up from 22% in 2019.
Income inequality hits a 30-year high with a Gini index of 32.7, fueled by inflation and recession eroding real incomes and consumption. Unemployment climbs to 7.1%, worsening labor markets. Analysts warn the burden falls hardest on low and middle classes; without strategies for growth, jobs, and safety nets, stabilization won’t endure.