Poverty worsens as investment stagnates - ADB report

There has been no visible reduction in poverty levels, while the rate of investment in Pakistan has also shown no acceleration, according to a new Asian Development Bank (ADB) quarterly report. "In the current fiscal year, the Pakistan government is aiming at a growth figure of 5.3 percent, up from the 5.1 percent rate of growth announced for the last financial year," Marshuk Ali Shah, the ADB country director for Pakistan, told IRIN in the capital, Islamabad, adding that a growth target of 6 percent to 7 percent needed to be achieved if reducing poverty was a serious aim. Total foreign investment was about US $820.1 million last year, with gross fixed investment remaining stagnant at 13.1 percent, the ADB report said, pointing out that an increase in gross national savings from 17 percent in 2002 to 19.2 percent in 2003 was entirely due to a higher amount of remittances. Domestic savings had declined to 14.7 percent, as against 16.1 percent in 2002, the report said. There had been no baseline for poverty-related figures, Shah said. "If you compare the statistics from, say, 1999 to 2003, poverty is very high, it has worsened," he maintained. The ADB report said the level of poverty had deteriorated to 32.1 percent in 2001-02 from 30.6 percent in 1998-99. Meanwhile, government figures extolling the improving state of the country’s economy have been questioned by a Pakistani economist with years of experience in the international sector. "The increase in the growth rate which the government has announced is predicated primarily in the growth shown in the agricultural sector, due basically to a good harvest last year than any structural change in that field," Dr Akmal Hussain told IRIN from Lahore, the capital of Punjab Province. He added that there had been no increase in the rate of investment in any sector. "For example, the government announced a growth rate of 5.1 percent for last year. The State Bank of Pakistan puts the growth in the same time frame as 4.7 percent. This is a huge discrepancy, arising primarily out of the fact that the agriculture sector showed an impressive output last year. That may not be a constant every year," Hussain stressed.