Economics issue of poverty in Pakistan

1. Lack of Foreign Investment

Due to backwardness, political instabilities and improper availability of infrastructure the
attraction for foreign investment is not suitable. Foreign investment is $ 1.8 billion in Pakistan.
Lack of foreign investment means less employment opportunities and poverty.

2. Low National Income

Poverty in Pakistan is also the result of low level of national income. Low level of
national income means low level of saving and low level of investment. All these factors
contribute toward poverty.

3. Use of Backward Technology

Techniques of productions used by developing countries are backward. Due to out-dated
methods of production, productivity level is low. Low level of productivity means narrowness of
market and reduction in exports and increase in imports.

4. Increase in Utility Charges

Utility charges like water, gas, electricity, telephone bills etc. are increasing day by day in
Pakistan. More utility charges lead to reduction in the saving of population and its result i

5. Backward Agricultural Sector

In agriculture sector people have adopted just subsistence farming styles. They are not
farming according to the commercial patterns. Sometimes due to natural calamities and use of
backward techniques of production, there is reduction in production and it decreases the income
of poor farmers.

6. Inflation
rate of inflation is an extra reason for poverty. Due to inflation much amount of money is
not enough to purchase much amount of goods and services. Inflation decreases the savings and
investments of poor people and they remain poor. Rate of inflation

7. Non-Productive Expenditures
Government has to make a lot of unproductive expenditures on social heads and to
make strong defence. These high expenditures are also a reason of population

8. Unemployment
Unemployment is the major cause of poverty. Unemployment means no source of income and
result is poverty. Rate of unemployment is 5.5 %, 16 % is underemployed and 20 % is
disguised unemployed in Pakistan.