A new United Nations report by the has UN Development Programme’s (UNDP) National Human Development Report (NHDR) for Pakistan has found. Released last week, the report for Pakistan focuses on issues of inequality in the South Asian country of 220 million people.
The report, “Power, People and Policy”, examines the stark income and economic opportunity disparities in the developing country.
The wide-ranging NHDR provides detailed data on deep-rooted inequality in Pakistan’s economy.
While the richest 1 percent held 9 percent of the country’s income of $314.4bn in 2018-19, the report found that the poorest 1 percent held just 0.15 percent.
Overall, the richest 20 percent of Pakistanis hold 49.6 percent of the national income, compared with the poorest 20 percent, who hold just 7 percent.
UNDP’s data showing middle-income earners fell from 42 percent of the population in 2009 to 36 percent in 2019.
The NHDR 2020 reveals that Pakistan’s people do not benefit equally from public expenditure,” reads the report. The overall share is 14.2 percent for the poorest, compared with 37.2 percent for the richest.
“The poorest and richest Pakistanis effectively live in completely different countries, with literacy levels, health outcomes, and living standards that are poles apart,” writes Aliona Niculita, deputy resident representative of the UNDP in Pakistan.
“Powerful groups use their privilege to capture more than their fair share, people perpetuate structural discrimination through prejudice against others based on social characteristics, and policies are often unsuccessful at addressing the resulting inequity, or may even contribute to it,” says the report.
Economic privileges accorded to Pakistan’s elite groups, including the corporate sector, feudal landlords, the political class and the country’s powerful military, add up to an estimated $17.4bn, or roughly 6 percent of the country’s economy.
The biggest beneficiary of the privileges – which may take the form of tax breaks, cheap input prices, higher output prices or preferential access to capital, land and services – was found to be the country’s corporate sector, which accrued an estimated $4.7bn in privileges, the report says.
The second and third-highest recipients of privileges were found to be the country’s richest 1 percent, who collectively own 9 percent of the country’s overall income, and the feudal land-owning class, which constitutes 1.1 percent of the population but owns 22 percent of all arable farmland.
Both classes have strong representation in the Pakistani Parliament, with most major political parties’ candidates’ drawn from either the feudal landowning class or the country’s business-owning elite. Those responsible for doling out the privileges were also those who were receiving them.
The country’s powerful military, which has directly ruled Pakistan for roughly half of its 74-year history, was found to receive $1.7bn in privileges, mainly in the form of preferential access to land, capital and infrastructure, as well as tax exemptions. Pakistan’s military is also “the largest conglomerate of business entities in Pakistan, besides being the country’s biggest urban real estate developer and manager, with wide-ranging involvement in the construction of public projects”.
In a country like Pakistan, where the military continues to hold power over many aspects of governance, Kanni Wignaraja, assistant secretary-general and regional chief of the UNDP, warned that it would take “almost a social movement” to displace structures of power that were so entrenched.
Pakistan ranks second-to-last in South Asia based on Human Development Index , outperforming Afghanistan but lagging behind all six of its other regional neighbours.
Pakistan ranks 153 out of 156 countries on the World Economic Forum’s Global Gender Gap Index, with 32 percent of primary-school-aged girls out of school.
“If I had just that one extra rupee, and you asked me where would I put it, I would put in girls education,” said Wignaraja. “The evidence across the world on one of the biggest returns on investment comes from educating all of our children and getting them and keeping them in school. But a huge return is that all of those missing girls from school and missing women from the workplace, it’s investing in that.”
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