The federal government has challenged the World Bank’s new poverty figures, saying Pakistan’s inclusion in the Middle East, North Africa, Afghanistan and Pakistan (MENAAP) region has distorted regional poverty comparisons and made the country’s poverty share look larger.
Adviser to the finance minister Khurram Schehzad said World Bank’s decision to move Pakistan from its South Asia reporting region to MENAAP was an administrative and statistical reclassification that changed the composition of regional figures not Pakistan’s geographical identity or income classification.
Schehzad argued that regional poverty rates can change when countries are added to or removed from a statistical group, even if poverty levels within individual countries remain unchanged.
He said Pakistan’s large population and poverty figures would have a significant effect on MENAAP’s regional totals, while its removal would also affect South Asia’s aggregate figures.
Schehzad illustrated the argument with a hypothetical example in which adding a country with a higher poverty rate to a region would increase the region’s overall rate without any immediate change in conditions in either country.
He said comparisons should instead rely on country-level data using the same poverty threshold and reference year.
The comments followed the World Bank’s October 2026 economic update, which said Pakistan accounts for nearly half of the people living in extreme poverty across MENAAP. However, the World Bank’s report does not attribute Pakistan’s rising poverty rate simply to its new regional classification.
It says Pakistan’s poverty rate increased by 6.4 percentage points at the $3-a-day poverty line and by 3.2 percentage points at the $4.20-a-day line between fiscal years 2018-19 and 2024-25.
The bank links the increase to the COVID-19 pandemic, the devastating 2022 floods, high inflation, currency depreciation and prolonged economic adjustment that weakened household incomes and employment opportunities.
The report also says Pakistan accounts for approximately 48 percent of people living below the $3-a-day poverty line across MENAAP.
While the inclusion of Pakistan affects the region’s aggregate poverty figures, that does not explain the increase in Pakistan’s own poverty rate. The country-level figures used by the lender compare poverty within Pakistan over time, rather than merely comparing the newly formed regional group with the former one.
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