Economic challenges in Pakistan include high inflation, rising unemployment, and increasing poverty. These issues are driven by political instability, weak economic policies, and external pressures like IMF conditions and global market fluctuations. As a result, the cost of living is soaring, and millions struggle to meet basic needs.
Inflation
Definition:
Inflation is the rate at which the general level of prices for goods and services rises, leading to a decrease in the purchasing power of money.
Current Situation in Pakistan (2024–25):
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Inflation has remained high, especially for essentials like food, fuel, electricity, and medicine.
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Inflation rate fluctuated between 25–30% in early 2024.
Causes:
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IMF Conditions: Removal of subsidies and higher taxation increased prices.
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Currency Depreciation: Fall in the value of the Pakistani Rupee made imports more expensive.
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Global Economic Pressures: Increased fuel prices and international inflation affected Pakistan.
Impact:
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Cost of living has surged, affecting common households.
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Middle- and low-income families are unable to meet basic needs.
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Increased poverty and reduced savings/investment.
Unemployment
Definition:
Unemployment is a condition where people who are capable and willing to work cannot find jobs.
Current Situation in Pakistan (2024–25):
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The unemployment rate is estimated around 8–9%.
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Youth unemployment is particularly high.
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Underemployment is also common – people are working part-time or jobs below their qualification.
Reasons:
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Slow Economic/Industrial Growth: Limited job creation in both public and private sectors.
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Political Instability: Investors hesitate to create job opportunities.
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Lack of Skill Development: Graduates often lack job-market-oriented skills.
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Brain Drain: Many professionals migrate abroad for better wages and opportunities.
Impact:
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Increased social frustration and crime.
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Wastage of human capital.
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Burden on families and the economy.
Poverty
Definition:
Poverty is the condition where individuals or families cannot afford basic necessities such as food, shelter, healthcare, and education.
Current Situation in Pakistan (2024–25):
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Around 39% of the population lives below the poverty line.
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Poverty is more severe in rural areas, where services and infrastructure are poor.
Causes:
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High Inflation: Reduces real income and purchasing power.
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Unemployment: No stable income leads to long-term poverty.
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Weak Welfare System: Social support programs like BISP are underfunded or inefficient.
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Natural Disasters: Floods and droughts destroy agriculture, especially in rural areas.
Impact:
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Poor health and education outcomes.
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Child labor and school dropouts.
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Increased dependency on aid and charity.
Summary of Key Economic Indicators (2024–25):
| Indicator | Status |
|---|---|
| Inflation Rate | 25–30% |
| Unemployment Rate | 8–9% |
| Poverty Rate | ~39% |
| PKR to USD | Volatile (fluctuating) |
