ISLAMABAD – Pakistan’s poverty rate has increased to 28.9 percent in fiscal year 2024-25, up from 21.9 percent in FY2018-19, according to the Pakistan Economic Survey FY2025-26. The highest poverty incidence was recorded in Balochistan at 47 percent, followed by Khyber Pakhtunkhwa at 35.3 percent.
Rising Inequality
The updated estimates also indicate a rise in inequality, with the national Gini coefficient increasing from 28.4 in FY2018-19 to 32.7 in FY2024-25. The increase was observed in both urban and rural areas. Urban inequality rose from 31.0 to 34.4, while rural inequality increased from 23.4 to 29.2. This suggests that the recent rise in poverty was accompanied by wider disparities in income distribution.
Provincial inequality also moved upward over the same period. In FY2024-25, the Gini coefficient stood at 32.0 in Punjab, 35.9 in Sindh, 29.4 in Khyber Pakhtunkhwa, and 26.5 in Balochistan. In FY2018-19, the corresponding values were 28.4, 29.7, 24.8, and 21.0. The provincial pattern indicates that inequality increased across all provinces, with Sindh recording the highest level in 2024-25.
Rural vs Urban Poverty
Poverty remained significantly higher in rural areas, where it increased from 28.2 percent to 36.2 percent, while urban poverty increased from 11.0 percent to 17.4 percent over the same period. At the provincial level, poverty increased across all major provinces. In FY2024-25, poverty was estimated at 23.3 percent in Punjab, 32.6 percent in Sindh, 35.3 percent in Khyber Pakhtunkhwa, and 47.0 percent in Balochistan. In FY2018-19, the corresponding rates were 16.5 percent, 24.5 percent, 28.7 percent, and 41.8 percent, respectively. Balochistan continued to record the highest poverty incidence, followed by KP and Sindh, while Punjab remained the lowest among the four provinces.
Pro-Poor Expenditures
During July-March FY 2026, total pro-poor expenditures stood at Rs 4,663.13 billion, compared to Rs 4,256.03 billion in the corresponding period of FY2025, the survey claimed. The strongest increase was recorded under natural calamities and other disasters, where spending rose from Rs 64.2 billion to Rs 224.92 billion, showing growth of 250.19 percent. This indicates a strong public response to climate-related and emergency needs.
Spending on roads, highways, and bridges also increased sharply by 69.32 percent, reaching Rs 566.07 billion. Similarly, environment, water supply, and sanitation increased by 47.64 percent, while social security and welfare rose by 43.20 percent to Rs 822.21 billion. In addition, expenditures on education and health also increased by 9.14 percent and 1.68 percent respectively during July-March compared to last year. Agriculture also remained an important component, with spending of Rs 412.50 billion, supporting rural livelihoods and food-related welfare concerns.
