World Bank warns as poverty in Pakistan hits 25.3%

Poverty in Pakistan has reached worrying levels, with a new World Bank report showing that nearly one in four Pakistanis now lives below the poverty line. The poverty rate has jumped to 25.3% in 2024-25, marking a 7% increase in the past three years.

Poverty on the Rise Since 2022

The report, shared by World Bank Country Director Bolormaa Amgaabazar, shows a steady increase in recent years:

• In 2022, the poverty rate was 18.3%.

• In 2023, it rose to 24.8%.

• By 2024, it reached 25.3%.

This marks a reversal of progress. From 2001 to 2015, poverty had been falling by around 3% each year. The decline slowed between 2015 and 2018, and after the COVID-19 pandemic and 2022’s economic crisis, poverty began climbing again.

Income Sources and Employment

The World Bank noted that poverty reduction in earlier years was driven mostly by non-agricultural income such as remittances, which made up 57% of the gains. Agricultural income contributed 18%. Overall, household incomes grew by 2–3% between 2011 and 2021.

However, structural issues remain. Around 95% of Pakistan’s workers are employed in the informal sector, and 85% are in low-income jobs, limiting economic stability.

Urbanisation Divide

The report also pointed out conflicting data on urbanisation. While the World Bank estimates that 60–80% of Pakistan’s population lives in urban areas, official government figures put the number at just 39%. This urban-rural divide is considered an important factor in poverty trends.

The findings underline the urgent need for policies that support job creation, fair wages, and social protection, especially for vulnerable groups hit hardest by inflation and economic slowdown.