Poverty Reduction Strategy for Sindh

POVERTY REDUCTION STRATEGY PAPER
ON
SINDH
Planning and Development Department
Government of Sindh
Karachi
DECEMBER 2003

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ACKNOWLEDGEMENTS
This document reflects an extensive process of consultations and builds on the ongoing Reform Program of the Government of Sindh.
Thanks are due to the present Government. Nazims, respective Administrative Secretaries, as well as the District Coordination Officers for their input into this strategy paper.
This strategy reflects the hard work of the Planning and Development Department, the Sindh Regional Plan Organization, and other departments of the Government of Sindh who also worked hard to put it together in a very short time. The services rendered by Mr. G. M. Abro Senior Chief, Science & Technology and Poverty Alleviation are also appreciated, who has made untiring efforts in completion of the study.
The financial assistance of UNICEF especially its local office in Karachi and Technical support of M/s Innovative Development Strategies (Pvt.) Ltd. are also gratefully acknowledged.
December 2003 Ghulam Sarwar Khero
Additional Chief Secretary (Development)

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ACRONYMS AND ABBREVIATIONS
ADB Asian Development Bank
AIT Agriculture Income Tax
AWB Area Water Boards
CCB Citizen Community Board
CBO Community Based Organization
CCO Citizen Community Organization
CRPRID Centre for Research on Poverty Reduction and Income Distribution
CWD Communications and Works Department
DAC Departmental Account Committee
DAO District Accounting Officer
DCO District Coordination Officer
DFID Department for International Development
EIROP Essential Institutional Reform Operationalization Project
EMIS Education Management Information System
EOBI Employees Old-age Benefits Institution
FBS Federal Bureau of Statistics
FMC Fiscal Monitoring Committee
GAVI Global Alliance for Vaccination Initiative
GTZ German Development Corporation
HMIS Health Management Information System
HR Human Resource
IM&R Instructional Materials and Minor Repair
IPRSP Interim Poverty Reduction Strategy Paper
LHW Lady Health Worker
M&E Monitoring and Evaluation
MICS Multiple Indicators Cluster Survey
MTBF Medium Term Budgetary Framework
NAB National Accountability Bureau
NGO Non –governmental Organization
NWFP North West Frontier Province
O&M Operation and Maintenance
P&D Planning and Development
PAC Public Accounts Committee
PFAA Provincial Financial Accountability Assessment
PIHS Pakistan Integrated Household Survey
PRP Poverty Reduction Plan
PRSP Poverty Reduction Strategy Paper
PSC Public Service Commission
PTA Parent-Teacher Associations
SBP State Bank of Pakistan
SME Small and Medium Enterprise
SPDC Social Policy Development Center
SWOT Strengths, Weaknesses, Opportunities and Threats
UNDP United Nations Development Program
WAPDA Water and Power Development Authority

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TABLE OF CONTENTS
Executive Summary
viii
Chapter 1
Introduction
1
Chapter 2
Poverty in Sindh
5
Chapter 3
PRSP Dialogue – The Consultative Process
38
Chapter 4
The Poverty Reduction Strategy
43
Chapter 5
The Medium term Budgetary Framework
73
Chapter 6
Monitoring and Evaluation
83

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LIST OF TABLES
Table 1.1
Provincial and Urban Rural Differences in Selected Human Development Indicators (1998-99)
2
Table 2.1
Poverty Trends in Pakistan by Province
5
Table 2.2
Poverty headcount, poverty gap and severity of poverty in Sindh during the 1990s by region
7
Table 2.3
Inequality (Gini): Mean per Equivalent Adult Expenditure—1998-99
8
Table 2.4
Trends in Gini index of inequality for Sindh during the 1990s
8
Table 2.5
Average Land Owned (Hectares) Per Household by Poverty Status (1998-99)
9
Table 2.6
Rural Poverty by Household Land Ownership (1998-99
10
Table 2.7
Average acres per capita owned, dependence on agriculture, and average number of crops cultivated by households depend only on crops Sindh
11
Table 2.8
Distribution of State-Owned Land
13
Table 2.9
Families and Livestock Affected by Drought in Districts Entirely Dependent on Rains
13
Table 2.10
Details of Affected Area by Sea Intrusion
14
Table 2.11
Household size, age composition and dependency ratio in Sindh by region, 1998-99
16
Table 2.12
Education Statistics of Sindh--1998-99
18
Table 2.13
:Population that has ever attended school – by expenditure quintile (Sindh— 2001-02)
18
Table 2.14
Literacy rate - population 10 years and older by expenditure quintile (Sindh)
18
Table 2.15
Gross primary, middle and matric level enrolment rate by expenditure quintile (Sindh)
19
Table 2.16
Proportion of Government School Enrolment in Total Enrolment at Primary
20
Table 2.17
Percentage of children aged 1 to 5 years that have been fully immunized by poverty status by region in Sindh, 1998-99
20
Table 2.18
Infant Mortality in Sindh (deaths per 1000 live births
21
Table 2.19
Contraceptive Awareness and Contraceptive Prevalence Rates in Sindh (% Currently Married Women 15 - 49 Years
22
Table 2.20
Main Source of Drinking Water—Sindh
23
Table 2.21
Nature of toilet facilities by region—Sindh
23
Table 2.22
Type of Sanitation System in Sindh
24
Table 2.23
Garbage Collection System in Sindh (2001-02
24
Table 2.24
Crude Activity (Participation) Rates By Sex, and Rural-Urban Areas (Pakistan and Sindh)
25
Table 2.25:
Percentage distribution of Civilian Labour Force by Gender,Pakistan and Sindh (1999-00
26
Table 2.26
Percentage distribution of employed persons, average monthly income and income share by type
27
Table 2.27
Percentage Distribution Of Employed Persons By Employment Status by Gender Sindh 1998-99
27
Table 2.28
Percentage Distribution Of Employed Persons By Employment Statusby GenderSindh 1998-99
28

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Table 2.29
Distribution of household income by source—Sindh 1998-99
29
Table 2.30
Sources of Consumption expenditure—Sindh 1998-99
30
Table 2.31
Deprivation Ranking – Sindh
31
Table 2.32:
Deprivation Ranking--Sindh [ALL AREAS) [1=Least Deprived 16=Most Deprived]
32
Table 3.1
Breakdown of District Participants by Categorie
38
Table 5.1
Summary Fiscal Accounts of the Government of Sindh (Rs. Million)
73
Table 5.2
Sindh - Public Finances, 1999/00-2005/06 (Percent of provincial GDP
74
Table 5.3
Composition of Expenditures, 1999/00-2005/06 Percent of Provincial Expenditures)
74
Table 5.4
Composition of Expenditures, 1999/00-2005/06 (Percent of Provincial Expenditures)
78
Table 5.5
Sindh - Available Financing
81
Table 6.1
Health indicators
88
Table 6.2
Education indicators
84
Table 6.3
Monitoring Indicators Under GoS Reform Program = Corresponding to National PRSP Targets
85
)

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LIST OF FIGURES
1.
Trends in Poverty Headcount (Pakistan and Sindh)
6
2.
Rural-Urban disparities in Sindh in money metric measures of Poverty
7
3.
Extent of Water Logging (0 to 5 feet water table depth) - 2000
12
4.
Rainfall Pattern in District Tharparkar
14
5.
Decline in ADP share in overall budget of Sindh (1999-2003)
17
6.
Decline in Annual Development Programme (1991-2003)
17
7.
Water Utilization in Sindh against Water Accord Allocations from year (1992-2003)
62

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EXECUTIVE SUMMARY
Sindh is resource rich province. It handles 90 percent of international trade. Large scale manufacturing sector of Sindh contributes 43 percent and Small Scale Manufacturing sector accounts for 25 percent to GDP. Contribution of Sindh’s agricultural sector in GDP is also significant. This province is producer of 15 percent of wheat, 42 percent of rice, 31 percent of sugarcane, 23 percent of cotton, 70 percent of marine fish and 28 percent of livestock. Sindh is also a large producer of oil and gas in Pakistan. 62 percent of total oil production and 48 percent of total gas production takes place in Sindh. About 39 percent of country’s electricity is generated in Sindh. Of the 3.16 million tons of coal production, Sindh’s share is 31 percent.
Yet the incidence of poverty in areas of rural Sindh, especially its Southern Districts and the urban and peri-urban areas excluding some parts of Karachi is amongst the highest in Pakistan. The aggregate estimates of the poverty headcount based on the Household Income and Expenditure Surveys (HIES) data hides this extremely high and growing incidence. The weight- age of Karachi in the overall population of Sindh seriously distorts the overall picture. With urban estimates including Karachi being low, the overall poverty level for Sindh is brought down. However, as per calculations done for this study, if we remove the data of Karachi from the estimations of poverty, it shows that poverty in overall Sindh based on the latest HIES 2000/1 data is 48.4 percent and 36.7 percent when included. This means that nearly one in every two in Sindh is below the poverty line outside of Karachi and this includes all the people living in the other important towns such as Hyderabad and Sukkur. Even within Karachi the predominant proportion of the population mainly living in Katchi abadis and slums is extremely poor. It is the extremely high levels of income of certain sections of the Karachi population that distort the overall picture. Moreover, the rural-urban gap estimates from the HIES show the largest disparity in Sindh. Not only this gap is large but it increased three fold from 12 percent in 1992-93 to over 36 percent in 2000-01. Poverty has worsened significantly overall and the gap between urban and rural Sindh has widened. Based on the latest year estimates, more than one out of every two rural person is living below the poverty line. In terms of human development, Sindh is far behind the rest of the country with the largest rural-urban gap in the key indicators. One out of every ten children born dies before his or her first birthday; one out of every nine children dies before reaching five years of age. Every twenty minutes a woman dies from complications relating to pregnancy and childbirth and four out of five women are anemic. Four out of seven children are mal-nourished at one point or the other and three out of every seven children are chronically malnourished (stunted). Three out of every five children aged five to nine are not in school and four children drop out of school every six minutes. One in five persons in Sindh does not have access to safe drinking water and one out of three persons do not have access to proper sanitation. This proportion is nearly one in every two for Rural Sindh. Nearly forty eight percent of the population of Sindh is under nineteen years of age and four out of six children under the age of five are not registered in the birth and death register maintained at Union Council/Municipal. The total population is currently estimated at about 30 million with an annual growth rate of 2.8 percent. The province is becoming highly urbanized with nearly 15 million people living in cities and towns. The urban population is growing at a faster rate than the overall population due in part to the rural to urban migration. This indicates the extent of the poverty problem in Sindh.

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The poor of Sindh can be categorized into five groups each with its own attendant and unique problems. The rural poor overall are cut off from access to essential public services and reasonable means to generate sustainable incomes and are tied into traditional customs and modes of production and livelihoods. Within this group is a sub group of ultra poor who lives in the Southern districts and have been the repeated victims of successive natural calamities such as drought, followed by excessive rainfall, flooding, cyclone, earthquake and of sea intrusion and resultant loss of valuable soil quality due to increasing soil salinity. Losses due to these catastrophies are enormous, Available estimates indicate that millions of people and livestock were affected and losses run into several percentage points of the Provincial GDP in addition to the enormous costs of the rehabilitation. The third group comprises of the growing peri urban communities of squatters, who migrated from the rural areas either because of lack of safety or of livelihood opportunities and are squatting around the towns of interior Sindh. Without adequate employment this growing group adds to the burden on the already strained public services in these towns and has little of no formal access to health, education and sanitation. The fourth group represents the urban poor of Karachi. This is perhaps the fastest growing group of poor. Its numbers are increased not only from the migration from interior Sindh but also from all the other provinces of the country. This group more than the others is cutoff from its natural support systems and traditional safety nets. Its growing weight adds not only to an ever increasing load on public services but is also slowing down the productivity of the region by choking up the social services, communications and infrastructure. The fifth and largest group of poor cuts across the other four groups and represents more than 70 percent of the population. This group comprises the large proportion of children under the age of 15 years and women of child- bearing age. This group of the very vulnerable represents the special requirements of the Sindh province in terms of poverty reduction.
There are several factors responsible for this sad and deteriorating situation in Sindh.
Land distribution in Sindh is highly skewed. Land ownership is a key factor in determining the access to formal credit. Unequal land tenure patterns therefore have adverse impacts on agricultural productivity. The prevalence of an unequal land distribution and acquisition is thus a major cause of poverty, skewed income distribution and significantly enhances vulnerability. A higher extent of water logging and salinity makes Sindh more vulnerable as compared to other provinces.
The deterioration of the irrigation network due to poor maintenance, low water rates and inefficient system of assessment and collection that recover only a third of the recurrent cost of irrigation have lead to enormous wastage of scarce water resources and reduced availability of irrigation water.
The province of Sindh has quite often been a victim of natural disasters such as drought, cyclones, earthquakes and sea intrusion. These disasters and natural phenomenon have had both short and long term effects on Sindh economy. The worst was that these affected the most relatively more deprived districts. Economic activity in the affected four districts of lower Sindh has squeezed. Though there are no numbers available at this stage, but incidence of poverty has certainly increased in these areas. These areas would, therefore, require a special focus and attention.

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The performance of the education and health sectors has remained unsatisfactory in Sindh. There are wide gender and rural urban differences in literacy, enrolment, infant mortality, and immunization, in Sindh. Among the number of factors that may be responsible for low indicators of education and health in Sindh, especially in rural areas, access to facilities is potentially important. Rural Sindh suffers from poor access to education and health facilities alike. On access to rural health facilities, the same story prevails. By any definition of health facility, rural Sindh ranks behind rural areas of every province except perhaps Balochistan. Access to family planning services also remain low in Sindh, which partly explains the relatively low rate of use of contraceptives.
The poor households in Sindh suffer from lack of connectivity to a number of services, such as, water, toilet, drainage, electricity, gas, etc. This has direct implications for their human development. Available data reveals that the poor in Sindh have relatively low access to safe drinking water and sanitation facilities: they are less likely to use closed sources of drinking water, have toilets in the household, and be connected to a drainage system. As expected, the poor are also less likely to be connected to electricity and gas facilities. Availability of all these amenities is also characterized by large rural-urban gaps.
The province of Sindh has been facing an acute fiscal crisis in recent years due to a combination of past fiscal mis-management, changes made in the federal revenue transfers mechanism in the 1997 National Finance Commission (NFC) Award, the large and the continued shortfalls in federal Government transfers. The fiscal crisis has crowded out resources for delivery of public services and maintenance of provincial infrastructure. Sindh's fiscal problems were particularly adversely affected by the 1997 NFC Award. Sindh, which generates the most revenue about 68% for the federal government, on the other hand, was left to the instability of energy-related "straight transfers" to meet its financial needs. The recurring shortfalls in federal tax collections and the resultant reduction in Federal flows from the "divisible pool" added to the province's fiscal problems. As a result, Sindh has been facing difficulties in meeting its expenditure obligations and the development and non-salary O&M expenditures have been falling well below the assessed needs, slowing down economic activity in the province and creating a huge backlog of unmet repairs and maintenance and unpaid utility bills and SBP overdrafts. The NFC award’s system of allocations from the divisible pool based on population alone is clearly biased against the Province of Sindh which generates by far the highest revenue for the Federal Government as compared to all the other Provinces, combined.
The synthesis of Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis from the district level consultation meetings indicates various strengths of the province such as, agriculture, fertile land, livestock, hardworking manpower, and handicraft industry. These meetings pointed out that the province is facing several weaknesses. Among them, shortage of irrigation and drinking water, increasing unemployment and lack of employment opportunities, illiteracy, lack of health facilities, deteriorating law and order situation, lack of monitoring mechanism for development activities, poor communication network, lack of access to justice, corruption, feudal system are the most prominent. Moreover, various opportunities and threats are also identified in these meetings. Various recommendations regarding income generating activities, enhancing the security of the poor, and increasing empowerment through building the human capital of the poor came up in these meetings.

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Declining fiscal space, increasing size of government sector in terms of civil servants, deteriorating situation of law and order, poor governance appeared as the main issues in Sindh. In order to address these issues, the GoS is implementing reforms with the overarching objective of reducing poverty by promoting growth and accelerating human development. This PRSP proposes five pillars: Fiscal and Financial Management Reforms; Improving Governance of Civil Service and Public Service Delivery; Promoting Private Sector Development and Economic Revival; Developing women and children; and Addressing Vulnerability to Shocks.
In order to address the issue of law and order in Sindh, Judicial and Police reforms are part of civil service reforms in this strategy paper. The crucial issues of public service delivery in terms of education, health, clean drinking water and sanitation, and urban services are also addressed under the pillar 2 of PRSP (Page 46).
A large potential strength of the Sindh economy lies in developing its potential in value-added agriculture. It provides the opportunity to build agro-based trade in processed high value-added agriculture. This PRSP recognizes that accelerating growth is key to poverty reduction but also that the private sector has to be the engine of this growth and that such growth should be based in the rural sector where the majority of the poor reside and where the highest employment multipliers are evidenced.
The Rural Development Strategy proposed here relies on the acceleration of growth in value- added agriculture and overall agriculture development accompanied by the development of the non-farm sector to bring about poverty reduction. In this respect the Government is envisaged to play only a supporting role to promote the private sector through improved provision of infrastructure and easy and timely availability of institutional credit and information and technology. An important step in this regard would be the revitalization of the Agriculture Extension and research Departments and the initiating of programs to enhance its technical capacity to help farmers increase production and export. Other specific areas of focus include assisting the development of the seed industry with public-private partnership; expanding the vaccination coverage of livestock; reducing the role of the public sector and improving the overall functioning of agriculture markets.
The largest poverty reduction comes from the development of the non-farm sector in rural areas. This sector is generally extremely employment intensive and requires the lowest amounts of capital per job created. The development of non-farm activities is therefore the ideal intervention for poverty reduction in these resource constrained conditions. The Government will actively promote off-farm employment opportunities by promoting agro-based industries and employment through processing and other activities and services that rely on the linkages with the farm sector The dairy and livestock sector offer enormous potential in this regard.
In addition to the rural development strategy covering both agriculture and trade the Province needs to promote its enormous tourism potential and encourage both domestic and international tourism. This requires infrastructure development and the development of facilities such as resorts, hotels, motels, rest houses, restaurants and gift shops. The Government can facilitate this process by providing access to and ensuring the beautification of local sites. The tourism sector needs better access to credit for kiosks and food stalls and preparing and distribution of advertisements, brochures, and seminars to attract tourists. The local Governments have a large

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role to play in this respect. The law and order situation is crucial for tourism development. In this respect ensuring the maintenance of law and order is extremely important for all three aspects of effective poverty reduction i.e. opportunity, empowerment and security.
The roads network in Sindh province is in a critical state of disrepair raising transport costs and adversely affecting the growth of markets, incomes and employment, especially in the rural areas. GoS's plans to improve its road management program through embarking on a road rehabilitation program that prioritizes maintenance, setting up a Roads Fund with an Overseeing Board that has stakeholder participation and involves private contracting. Revitalization/ improvement of feeder Railway network with the cooperation of Pakistan Railways, as to provide economical access & mobility to rural population. The other main component of its strategy is to implement the process of devolution and decentralization of the management of district roads-which constitute the vast majority of the road network - to district Governments. Finally, the GoS's Medium Term Frame Work Provincial (MTFRP) provides the fiscal space to increase allocations for road rehabilitation in both the current and development budgets several fold.
The PRSP strongly endorses the mainstreaming of gender in all growth promotion activities in the Province as the most efficient means for poverty reduction. The provincial government will implement numerous strategies in this regard, which include: promoting the participation of women in decision making processes; policy change to facilitate female participation; capacity building and skill development; partnership with community, NGO and private sector; gender disparity reduction; ensuring access to gender disaggregated data; and provision of improved access to social services for the female population.
It is now accepted worldwide that there can be no sustainable development without giving access to rights. Rights of the children are of special significance in this regard. The government has shown commitment by announcing plans to of adequately funding the Plan of Action for Children. While detailed indicators are included in the PPA, three indicators on birth registration, juvenile justice and education of worst forms of child labour are being included in the PRSP for creating sharp focus and linkages between the policies of the government and its implementation methodology. The Plan of Action for Children will provide the matrix for implementing the commitments contained in the PRSP.
The Government of Sindh is currently preparing a MTBF for selected departments (namely health, education and irrigation) which proposes to address “the existing procedures and structural rigidities in the composition of expenditures (largely because of overstaffing) and in the revenues (because of the high degree of dependence on federal transfers) which have made provincial budget formulation a routine affair. Almost 90 percent of the recurrent budget is classified as permanent expenditures and activities are mechanically accepted each year without any comprehensive review or evaluation to phase out or reduce spending on non-priority areas, resulting in the delinking of the budget preparation from policy” However, this MTBF has yet to be approved by the Government of Sindh. This PRSP therefore uses the MTBF approved by the Government of Sindh under its Fiscal Restructuring Program of FY2000/01 as a bench-mark. Once the estimates from the ongoing exercise are approved these can be easily incorporated into the overall framework.

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The MTBF covering the period from FY 03 to FY 06 focuses on the creation of fiscal space for poverty reducing current and development expenditures. The fiscal space is created from three sources significantly higher non-tax revenues (from new oil and gas revenues from production in three new fields in Sindh that are collected by the Federal Government and returned to the province), higher donor assistance (from ADB, other donors, and the World Bank), and from increases in provincial tax effort with revenues rising by 15% p.a.
The fiscal program aims to raise public savings for the province through (i) revenue measures; (ii) increasing cost recovery; (iii) reducing undirected subsidies; (iv) through investment of all G.P. (pension) funds current surpluses; (v) through an accelerated repayment of expensive debt owed to the Federal Government, and (vi) reducing the wage bill through a separation package.
The poverty reducing expenditure targets on health, education, and drinking water will be transferred, as needed, to the district and Tehsil Governments as tied grants (as it is already the case with Rural Water Supply and Sanitation (RWSS) schemes. In addition to these items, the GoS will also give high priority in allocating additional resources for the maintenance and rehabilitation of rural infrastructure.
This PRSP proposes ambitious short term poverty reduction targets that can place the province well on the way to achieving the rates of decline implicit in the Millennium Development Goals (MDGs) to which Pakistan is a signatory and to the Federal PRSP targets. This strategy proposes a decline in poverty from its overall estimated level at 36.7 percent in 2000/01 to 28 percent in 2006. Rural poverty is expected to decline from 52.2 percent estimated in 2000/01 to 44 percent in 2006 and urban poverty from its estimated level of 14.9 percent to 10 percent by 2006. Gross primary enrollment rate is planned to increase from 60 percent to 80 percent over the period 2003 to 2006 and the infant mortality rate is expected to decline from 95 to 60 during this period. These short term rates are in line with the levels needed to meet the MDG targets by the year 2015 for the province. The achievement of these targets requires poverty reducing development expenditures of Rupees 40,000 million over the three year period 2003/04 to 2005/06. And the achievement of these goals requires the concerted efforts of not only the Government of Sindh but also of the private sector, the civil society and all the people of the Province.
What is presented in the pages that follow the overall strategic framework of the Government of Sindh in line with National IPRSP , draft PRSP and MDGs, to bring about the desired poverty reduction in the Province. The next steps include the translation of this strategy into a poverty alleviation action plan with detailed project proposals and budget estimates relating to projects in the strategically identified areas.

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CHAPTER 1: INTRODUCTION
Sindh is the second largest province of Pakistan in terms of population. It occupies 19 percent of total Pakistan’s area and accommodates 23 percent of Pakistan’s population. It is the most urbanized province of Pakistan. 49 percent of its population lives in urban areas. This province is the producer of around 29% of national GDP. Sindh's economy is relatively industrialized with industry accounting for 28% of the GPDP (with manufacturing accounting for 16%), followed by agriculture (23% of the economy), commerce (17%), and transport and communications (12%).
The contribution of Sindh’s agricultural and manufacturing sector in GDP is significant. Sindh’s capital is Karachi, which is the commercial hub and the gateway of Pakistan. This city handles 95% of Pakistan’s foreign trade; contributes 30 % in Pakistan’s manufacturing sector; accounts for 68 % of the tax receipts; almost 90 % of the head offices of the banks, financial institutions and multinational companies are in Karachi; country’s largest stock exchange is Karachi-based making it the financial and commercial hub of the country; it also comprises about 40% of the total banking and insurance sector of the country. Sindh’s contribution in country’s agriculture is significant. This province produces 41 percent of total rice; 21 percent cotton; 31 percent sugarcane; 14 percent of wheat; 71 percent of Banana; 42 percent of Dates; and 34 percent of Mangoes. In addition, 68 percent of total fish is produced in Sindh.
In terms of human development, Sindh is far behind the other Provinces with the largest rural- urban gaps in all the key indicators. One out of every ten children born dies before his or her first birthday; one out of every nine children dies before reaching five years of age. Every twenty minutes a woman dies from complications relating to pregnancy and childbirth and four out of five women are anemic. Four out of seven children are mal-nourished at one point or the other and three out of every seven children are chronically malnourished (stunted). Three out of every five children aged five to nine are not in school and four children drop out of school every six minutes. One in five persons in Sindh does not have access to safe drinking water and one out of three persons do not have access to proper sanitation. This proportion is nearly one in every two for Rural Sindh. Nearly forty eight percent of the population of Sindh is under nineteen years of age and four out of six children under the age of five are not registered. The total population is currently estimated at about 30 million with an annual growth rate of 2.8 percent. The province is highly urbanized with nearly 15 million people living in cities and towns. The urban population is growing at a faster rate than the overall population due in part to the rural to urban migration.
The urban rural gap can be seen not only in the human development indicators but also in money-metric indicators of poverty (see chapter 2). This province because of Karachi exhibits the highest per-capita incomes, but its human development indicators especially in the rural areas were among the worst in Pakistan in FY 99 (see table 1.1). It also has the highest gender disparities.

2
Table 1.1: Provincial and Urban Rural Differences in Selected Human Development Indicators (1998-99)
Male Literacy Rate
Female Literacy Rate
Infant Mortality Rate (per 1000 live births)
Incidence of Diarrhea (Children of age 5 and below) (%)
Pre-natal Consultation for women (%)
Ever-use Contraception (Married women of age 15-49) (%)
Rural areas
Punjab
50.1
20.0
101.7
13.9
24.6
18.0
Sindh
52.3
11.2
102.7
8.7
19.0
7.9
NWFP
51.5
11.4
58.7
15.6
19.6
13.9
Balochistan
47.2
6.8
75.1
9.9
14.9
5.7
Urban areas
Punjab
71.2
53.6
70.6
10.5
57.9
33.9
Sindh
77.5
54.9
67.1
11.7
70.4
36.4
NWFP
65.5
35.2
62.0
11.7
36.0
27.2
Balochistan
70.9
32.5
120.6
10.7
42.5
24.0
Source: Poverty in Pakistan in the 1990s: An Interim Assessment, South Asia Region, The World Bank, 2001.
Rural Sindh is highly dependent on public services, whereas the private sector plays a major role in urban Sindh. Thus, reforms to improve public service delivery, along with reforms to stimulate rural growth-that can rise agricultural and non-agriculture wages-will be fundamental for reducing poverty in rural Sindh.
One of the major causes of rising poverty in Sindh is the deteriorating situation of governance. Poor governance has resulted not only in rise in poverty and worsening social indicators but also in poor quality of public service delivery. In addition, fiscal and financial mismanagement resulted in decreasing fiscal space for high priority expenditures. The number of civil servants increased and support staff of grades 1 to 5, many of whom are illiterate, make up more than 43% of the civil service. The burden of poor law and order, complex regulations, and poor governance made the investment climate hostile and manufacturing units migrated from Sindh or closed down. Consequently the growth rates fell, especially in manufacturing sector, which decelerated faster in Sindh than the national average. Although the agriculture sector exhibits a higher growth rate than the national average, this growth has not been translated into social well- being. This sector suffers from three major problems; an irrigation infrastructure that is crumbling, excessive and increasing problem of water logging and salinity and water shortage or not timely available. The irrigation infrastructure is disintegrating due to lack of repairs and maintenance. Excessive salinity in the province is estimated to reduce cropping productivity of its main crops-cotton, wheat, sugar cane and irri rice-by around 40%.
However, one encouraging trend has been the growing diversity through significant value-added in fisheries and fruit farming.

3
The Federal Government in its Interim Poverty Reduction Strategy Paper of November 2001 stressed five main pillars:
1. Engendering growth
2. Governance reforms
3. Creating income generating opportunities
4. Improving human development
5. Reducing vulnerability to shocks
In addition to this the draft Federal PRSP (summarized version) of May 2003 also reinforces the three areas found lacking in the IPRSP namely:
1. Gender
2. Environment
3. Rural development/Employment
The summarized PRSP document notes that for effective poverty reduction growth must originate from sectors with the highest employment multipliers. It proposes targeted policy interventions for quick relief through short-term employment opportunities, social safety nets and financial assistance. It increases the emphasis on improved access to basic needs such as primary/ elementary education, health care, population welfare services and in particular improved public service delivery. There is an increased emphasis on monitoring and evaluation.
While the national PRSP provides the overall directions for poverty reduction a province specific poverty reduction strategy had already been initiated in Sindh in 2000. This Sindh Reform Program has three key elements:
1. Fiscal and financial management reforms
2. Improving governance of civil service and public service delivery
3. Promoting private sector development and economic revival
The extensive consultations undertaken as part of the process of building the current strategy confirmed that the three pillars defined above were indeed the three essential elements for an effective poverty reduction strategy. Based on these consultations two additional elements were added to the main pillars for the PRSP for Sindh. These are:
4. Focusing on women and children
5. Addressing vulnerability to shocks (safety nets)
Removing gender disparities and focusing on women is a cross cutting issue. However, a special highlight needs to be placed on developing women and children as a conscious choice because it is the one strategic area where the payoff in terms of poverty reduction is the highest. Women of child bearing age and children account for over seventy percent of the population of the Province. They are also the most disadvantaged and vulnerable. The most effective poverty reduction can come about simply by addressing this vulnerability. The long-term consequences of doing this are also most significant. Addressing this vulnerability today provides the pre-

4
conditions for long-term poverty reduction. If due attention is not paid to this extremely important segment of the population today the consequences for tomorrow are catastrophic. Sindh like the other provinces is sitting on a poverty bomb that will explode in the coming years with much more disastrous consequences than are being faced today.
And addressing vulnerability to shocks is extremely important to a province where the vagaries of nature affect a significant proportion of the population through the effects of floods, drought and sea intrusion.

5
CHAPTER 2: POVERTY IN SINDH
Trends in Money-metric Measure of Poverty
The available information on the headcount of poverty based on the Household Income and Expenditure Surveys (HIES) data indicates that poverty in the Sindh declined marginally during FY93-FY97 and then increased sharply (by 41%) in FY99. This increasing trend of poverty in late 90s in terms of the money-metric measure is evidenced in both the urban as well as in the rural areas. However, FBS (2001) explains that low poverty in 1996-97 is dubious because of a very low average household size revealed by that survey which is in fact, not comparable with other years but also appeared out of trend when compared with the 1998 population census and 1996-97 PIHS. There was no economic reason to expect the sharp decline in poverty in Sindh that emerges from the data for FY97 especially since the estimates for the year prior and those for subsequent years follow a trend.
Table 2.1: Poverty Trends in Pakistan by Province
Source: ADB (2002). Poverty in Pakistan: Issues, Causes and Institutional Responses
Estimates for FY01 based on another calculations for the FBS Household Income and Expenditure Survey 2000-01
The rural urban gap in Sindh is the highest as compared to the other Provinces. The gap of over 18 percentage points in 1998-99 was the highest amongst all other provinces and had worsened to over 36 percentage points according to the estimates for 2000-01. Poverty has worsened significantly overall and the gap between urban and rural Sindh has widened. Based on the latest year estimates more than one out of every two rural person is living below the poverty line. This indicates the extent of the poverty problem in Sindh.
Province
FY93
FY94
FY97
FY99
FY01
Urban Areas
20.7
16.3
16.1
22.4
21.5
Punjab
22.0
18.1
16.9
25.5
24.4
Sindh
17.3
11.8
12.0
16.1
14.9
NWFP
25.3
26.9
27.2
29.2
29.6
Balochistan
31.8
16.8
23.0
24.3
21.8
Rural Areas
28.9
34.7
30.7
36.3
45.6
Punjab
26.5
33.9
28.3
36.0
44.2
Sindh
29.5
31.8
19.6
34.7
52.2
NWFP
37.0
40.0
43.4
44.9
45.2
Balochistan
28.1
37.9
42.5
22.5
36.6
Overall
26.6
29.3
26.3
32.2
38.5
Punjab
25.2
29.5
25.0
33.0
38.6
Sindh
24.1
22.6
15.7
26.6
36.7
NWFP
35.5
38.1
41.2
42.6
42.9.
Balochistan
28.6
35.5
38.4
22.8
34.1

6
The comparison of poverty trends in Sindh with those of Pakistan seen in Figure 1 below shows that the rate of decline in poverty was higher in Sindh as compared to whole Pakistan until 1996- 97. However, this changed radically with the sharp rise in poverty in Sindh in FY 99 and FY01.
However the overall money metric estimates of poverty in Sindh are seriously biased downwards by the inclusion of Karachi which seriously distorts the overall picture. With urban estimates including Karachi being low the overall poverty level for Sindh is brought down. However, analysis conducted for this study on the HIES 2000/01 data shows that with the removal of data for Karachi from the estimations poverty in overall Sindh is 48.4 percent while it is 36.7 percent with it included. This means that nearly one in every two person is below the poverty line outside of Karachi and this includes all the important towns such as Hyderabad and Sukkur.
Figure 1: Trends in Poverty Headcount (Pakistan and Sindh)
Rural-Urban disparity in Sindh
Rural-urban disparities are more pronounced in Sindh. This can be seen in both money metric and non-income measures of poverty. In terms of money metric measures, this gap is not only pronounced but also shows a persistent rise over time [see figure 2]. In terms of non-income measures, this province exhibits largest rural-urban gaps in literacy rates, infant mortality rates, and the incidence of diarrhea. Disaggregation of households between poor and non-poor, it has been found that urban poor are better off than the rural non-poor in terms of literacy, enrolment, and immunization. A comparison of urban and rural non-poor indicates large differences in terms of all human development indicators, such as, literacy, enrolment, immunization, piped water, drainage facility, electricity, toilet facility, etc.
26.629.326.332.222.619.652.248.438.536.724.115.734.731.829.526.60102030405060FY93FY94FY97FY99FY01 % Poverty headcount PakistanSindhSindh ruralSindh without Karachi

7
Figure 2: Rural-urban disparities in Sindh in money metric measures of poverty
Other measures of poverty, namely poverty gap (P1) that estimates the depth of poverty, and squared poverty gap that measures the severity of poverty (P2), indicate the similar picture, not only in comparison with Pakistan and Sindh but also in urban and rural areas of Sindh. For example, the severity of rural poverty is relatively higher, while that of urban poverty relatively lower in Sindh as compared with Pakistan. Both these measures are considerably higher in rural Sindh in comparison with urban Sindh.
Table 2.2: Poverty Gap and Severity of Poverty in Sindh
Poverty Gap (P1)
Severity of Poverty (P2)
FY93
FY94
FY97
FY99
FY93
FY94
FY97
FY99
Urban areas
Pakistan
3.92
3.39
2.68
5.29
1.02
0.90
0.70
1.67
Sindh
2.91
1.93
1.65
2.95
0.75
0.44
0.35
0.79
Rural areas
Pakistan
4.66
6.79
5.03
7.87
1.20
2.00
1.35
2.52
Sindh
5.31
5.49
3.12
7.6
1.49
1.56
0.74
2.46
Overall
Pakistan
4.46
5.85
4.35
7.13
1.17
1.71
1.17
2.27
Sindh
4.25
3.85
2.37
5.59
1.17
1.04
0.54
1.73
Source: FBS (2001)
The final report of the Sindh Rural Development Project (SRDP) (2000) prepared by Agrodev consultants for the Asian Development Bank undertook a detailed analysis of 56 villages in five districts of lower Sindh1. The report establishes that by keeping the poverty line at Rs. 6,954 per capita per annum, at least 73 percent of the rural population can be termed as poor. The report finds that the proportion is expected to be even higher for isolated villages. Nearly 82 percent of
1 These districts are Thatta, Dadu, Badin, Mirpurkhas and Umerkot.
51611201220193712131616-421-215-10-50510152025303540FY93FY94FY99FY01PunjabSindhNWFPBalochistan

8
total population that comprised of 60 percent of total families live on less than a dollar per day in these five districts.
Inequality
The decade of 1990 shows an increase in inequality with highest Gini coefficient in 1998-99. Inequality in Sindh and Punjab was higher than NWP and Balochistan. Table 2.3 below presents the available estimates of the Gini coefficient (expressed as a percent) of consumption expenditures. In Punjab, inequality in urban areas is much higher than in rural area. The Gini coefficient for urban Punjab is about 12 percent higher than the rural Punjab.
Table 2.3: Inequality (Gini): Mean per Equivalent Adult Expenditure—1998-99
Punjab
Sindh
NWFP
Balochistan
Pakistan
Urban
37.0
33.0
34.6
25.5
37.0
Rural
25.7
24.6
24.5
22.5
25.7
Overall
30.6
30.4
27.1
22.9
30.6
Source: World Bank (2002)
Table 2.4 presents the trends in Gini index in Sindh in comparison with country as a whole during 1990s. This table shows an increasing trend in inequality in 1990s when comparing 1990 with 1999. A slightly higher Gini index than the estimates of Pakistan shows higher incidence of inequality in Sindh as compared to Pakistan.
Table 2.4: Trends in Gini Index of Inequality for Sindh
FY93
FY94
FY97
FY99
Pakistan
26.85
27.09
25.85
30.19
Sindh
28.48
27.54
25.30
30.82
Source: FBS (2001)
The poor of Sindh can be categorized into five groups each with its own attendant and unique problems. The rural poor overall who are cut off from access to essential public services and reasonable means to generate sustainable incomes and are tied into traditional customs and modes of production and livelihoods. Within this group is a sub group of ultra poor who live in the Southern districts and have been the repeated victims of successive natural calamities such as drought, followed by excessive rainfall and flooding, earthquakes, and of sea intrusion and loss of valuable soil quality due to increasing soil salinity. Losses due to these catastrophes are enormous, These catastrophes lead to loss of valuable incomes and assets and present the province with enormous rehabilitation costs. Available estimates indicate that millions of people and livestock are affected and losses run into several percentage points of the Provincial GDP in addition to the enormous costs of the rehabilitation. The third group comprise the growing peri urban communities of squatters who migrated from the rural areas either because of lack of safety or of livelihood opportunities and are squatting around the towns of interior Sindh. Without adequate employment this growing group adds to the burden on the already strained public services in these towns and has little of no formal access to health, education and sanitation. The fourth group represents the urban poor of Karachi. This is perhaps the fastest growing group of poor. Its numbers are increased not only from the migration from interior

9
Sindh but also from all the other provinces of the country. This group more than the others is cutoff from its natural support systems and traditional safety nets. Its growing weight adds not only to an ever increasing load on public services but is also slowing down the productivity of the region by choking up the social services, communications and infrastructure. The fifth and largest group of poor cuts across the other four groups and represents more than 70 percent of the population. This group comprises the large proportion of children under the age of 15 years and women of child-bearing age. This group of the very vulnerable represents the special requirements of the Sindh province in terms of poverty reduction.
There are several reasons behind these high and increasing levels of poverty in Sindh:
Land Resources
Nearly 52 percent population of Sindh lives in rural areas and derives its livelihood from agriculture. Sindh contributes significantly in Pakistan’s agriculture. 41 percent of total rice, 21 percent cotton, 31 percent sugarcane and 14 percent of total wheat are produced in Sindh. In addition, Sindh’s share in fruits production is also high; Banana accounts for 71 percent of total Pakistan’s Banana production, Dates 42 percent and Mangoes 34 percent of total production. Besides, 68 percent of total fish is produced in Sindh. However, poverty in Sindh is expected to be strongly associated with lack of asset ownership, an important component of which is agricultural land in rural areas. According to the Agricultural Census (1990), Sindh had 16 percent of total farms that occupy 18 percent of total farm area of Pakistan. Distribution within Sindh shows that 33 percent farms can be classified as small farms (less than 2 hectares), 47 percent were medium farms (greater than 2 but less than 5 hectares), and 19 percent were large farms (greater than 5 hectares) in 1990. This year 51 percent of total farms and 59 percent of total farm area was owner operated; 8 percent farms and 12 percent area was operated by owner- cum-tenants and 42 percent farms and 29 percent areas was operated by tenants in Sindh.
In order to examine the extent of rural poverty, it would be useful to look at the average landholdings by poverty status. Table 2.5 shows that in Sindh, on average poor households own 0.6 hectares of land against the 2.8 hectares owned by non-poor households.
Table 2.5: Average Land Owned (Hectares) Per Household by Poverty Status (1998-99)
Pakistan
Sindh
Poor
0.4
0.6
Non-poor
1.4
2.8
Total
1.1
2.1
Source: World Bank (2002). SAC
Poverty headcount and land ownership have an inverse relationship. Table 2.6 reveals that poverty headcount was highest (43%) for landless and lowest (14%) for those who own more than 4 hectares. This indicates that as the size of landholding increases, incidence of poverty declines. Distribution of agricultural land is found to be even more skewed in rural Sindh than for rural Pakistan as a whole - 70% of the rural population of Sindh is landless, compared to 61% of the rural population of Pakistan (Table 2.6). Consistent with this observation, the difference in average landholdings of the poor and non-poor households in rural Sindh is 2.2 hectares,

10
compared to 1 hectare for all rural areas of the country (Table 2.4). Among the number of factors likely to be responsible for the more skewed pattern of landholdings in Sindh, one could be the relatively low impact of land reforms, especially in comparison to Punjab.
Table 2.6: Rural Poverty by Household Land Ownership (1998-99)
Landholding Category
Poverty headcount
Percent population in category
Rural Pakistan
Rural Sindh
Rural Pakistan
Rural Sindh
No Land Owned
40.3
42.8
61.4
70.2
0 – 1 hectare
33.8
36.9
18.4
5.5
I – 2 hectare
29.5
28.9
5.9
4.8
2 – 4 hectare
22.4
27.6
7.0
7.0
4 hectare +
12.8
14.3
7.3
12.5
Source: World Bank (2002). SAC
Land ownership is a key factor in determining the access to formal credit. Unequal land tenure patterns therefore have adverse impacts on agricultural productivity. The prevalence of an unequal land distribution system is thus a major cause of poverty, skewed income distribution and significantly enhances vulnerability.
This pattern was especially reaffirmed by the SRDP (2000) study. The land tenure pattern is highly skewed in the project areas of the SRDP. Nearly 81 percent of the rural households do not own any land. Of the 19% that own agricultural land, 13% own 59% of the total agricultural land while the remaining 87% own the rest of the land. 40% of the total rural households comprise of hari or sharecroppers. The skewed land distribution pattern has resulted in a Zamindar-Hari system under which the haris provide input and labor while the Zamindars provides land and seeds. The product is shared equally but only in theory. In reality the Haris are often unable to provide their share of the inputs, which results in debt bondage and consequent further increase in poverty [see SRDP (2000)].
Since a majority of poor is either landless or small farm holder, it would be interesting to examine the dependence of poor and non-poor households on a single agricultural activity or on both. SRDP (2000) reports that most poor households operate small farms which are unproductive due to lack of irrigation water, and prevalent water logging and salinity. Moreover, owner-operator households generally cultivate around 3 hectares on average while the cut-off point for staying above the poverty line is the income that would come from cultivating 5 hectares. This indicates therefore the need to depend on sources of income other than crops even for the average owner operators. Table 2.7 presents average acres per capita owned, dependence on agriculture, and the average number of crops cultivated by households depending only on crops. This table reveals a large and significant difference between poor and non-poor in the amount of land per capita owned by the households. This table confirms the a priori expectation that a majority of non-poor depends on crops and poor depends on livestock. The percentage of households that depend on both, crops and livestock is substantially higher for the non-poor. This clearly indicates that poor not only tend to be landless or small landholders but also have more difficulty in managing risks, therefore unable to diversify their production. The last row of table 2.7 indicates the degree of diversification among those households that depend only on crops.

11
This data shows that poor households have less diversification than the non-poor. The average number of crops cultivated by the poor is 2.01 against 2.36 for the non-poor. This difference is statistically significant (FBS 2001)
Table 2.7: A Comparison of Poor and None-Poor Farm Households Sindh - 1998-99
Non-poor
Poor
Per capita ownership of land (acres)
0.80
0.26
Households depending only on crops (%)
31.64
43.09
Households depending only on livestock (%)
3.77
2.40
Households depend on both crops and livestock (%)
8.92
5.78
Number of crops cultivated by households depending only on crops
2.36
2.01
Source: FBS (2001)
SRDP (2000) revealed that small farms in Lower Sindh concentrated on wheat and rice with less emphasis on fodder crops. The poor farmers focus more on food crops, which they grow for themselves. Large farmers generally grow cotton and sugarcane since these crops demand large tracts of land to be feasible. Poor tenant farmers also grow cotton and sugarcane but only as and when dictated by the landlords.
The distribution of State owned land to landless and/or small farmers can help in addressing the issue of rural poverty. According to the report of Federal Land Commission (2002), as reproduced in Table 2.8, the total land allotted between July 2001 and March 2002 was 43,405 acres; 29 percent in Punjab, 19 percent in Sindh, 40 percent in NWFP and 12 percent in Balochistan. This report indicates that over 2.7 million acres are still available for distribution of which 2 percent is in Punjab, 27 percent in Sindh, 19 percent in NWFP and 52 percent in Balochistan.
Table 2.8: Distribution of State-Owned Land
Province
Total Land Allotted
July 01 to March 02
(Acres)
Total Beneficiaries
(#)
Available for Allotment
Mach 02
(Acres)
Punjab
12,663
958
55,609
Sindh
8,075
972
740,598
NWFP
17,578
NA
526,930
Balochistan
5,089
157
1,416,761
Total
43,405
2,087
2,739,898
Source: Federal Land Commission
The distribution of land to the landless, the provision of adequate infrastructure and the timely availability of inputs including water and credit would help in reducing poverty in rural areas of Sindh.
Water Logging and Salinity
Out of total land area of Sindh, nearly 39 percent is cultivable. About 9.9 percent is culturable wastes and 4.8 per cent is under forestry. The remaining 44.2 percent is not available for

12
cultivation. 57 percent of the cultivated is current fallow. It has been estimated that 42 percent of the current fallow is salt affected, which is highest in the country and reflects on the poor water availability, mismanagement and ill practices of irrigation systems in the province. This situation is very alarming. The extent of water logging and salinity is more pronounced in Sindh than other provinces of Pakistan [see figure 3].
Figure 3: Extent of Water Logging (0 to 5 feet water table depth) - 2000
Source: Agricultural Statistics of Pakistan (2001-02)
The available data indicate that the extent of salinity may be higher in Punjab (43%) followed by Sindh (34%) in 2000 but the Sindh situation is worst in that the most of the severely affected salinity area is in Sindh. Nearly 39 percent of total saline land in Pakistan is classified as severely saline. Of this severely affected area, 49 percent is in Sindh.
Calamities in Sindh
The province of Sindh has quite often been a victim of natural disasters such as drought, cyclones, earthquakes and sea intrusion. These disasters and natural phenomenon have had both short and long term effects on Sindh economy. The worst was that these affected relatively more deprived districts the most. Economic activity in the affected districts has squeezed and. Though there are no numbers available at this stage, but incidence of poverty has certainly increased in these areas. These areas would, therefore, require a special focus and attention.
Drought
Recently, actual shortage of river and canal water has resulted in drop down of aquifers from 150 feet to 500 feet. This has resulted in a shortage of drinking water as well as a decline in areas under major crops due to less water for irrigation. This has adversely affected livestock, agriculture, and fishing. As a consequence of this natural disaster, people of this area became more vulnerable. Persistent drought conditions in recent years have added to miseries of the people. Table 2.9 gives an overall magnitude of the affected families and livestock in six districts of Sindh which are entirely dependent on rains.
Sindh88% NWFP2%Punjab9% Balochistan1%

13
Table 2.9: Families and Livestock Affected by Drought in Districts Entirely Dependent on Rains
District
Dehs
Villages
Population
Families
Livestock
#
#
(000' #)
(000' #)
(000' #)
Tharparker
159
1,895
900
138.2
3,000
Mirpurkhas
25
316
150
24.8
1,000
Sanghar
2
18
40
7.0
250
Dadu
65
453
260
18.8
1,150
Thatta
5
181
30
6.0
200
Ghotki
9
50
10
2.0
30
Total
265
2,913
1,390
196.8
5,630
Government of Sindh
The table shows that around 1.4 million people and more than 5.6 million livestock heads have been adversely affected due to drought conditions. Tharparkar is the worst hit district, followed by Dadu and Mirpurkhas.
Loss of crop income in these districts has resulted in an increase in the vulnerability of poor households. In order to meet daily requirements they either take loans on high interest or sell livestock at prices much lower than the market value. As a result of loss of livelihood, around 0.3 million persons have moved towards the barrage areas of Sindh. The impact of drought on economic, social and environmental set up of affected area can be summarized as:
 High cost of feed and unavailability of water for livestock
 Reduced milk production
 High livestock mortality rates
 Scarcity of drinking water due to drying of wells and alarmingly low level of underground water
 Deterioration of general health of human beings, for example, increase in the incidence of tuberculosis, night blindness and respiratory ailments
 Loss of crop income due to less or no availability of irrigation water.
 Increased unemployment due to limited diversification in sources of income resulted in increase in unemployment.
Tharparkar is one of the most underdeveloped and vulnerable districts of the province. It is highly dependent on rain water for sustenance and livelihood of the people. Drought has severely affected this district. Figure 4 below gives a pattern of rainfall Tharparkar. It shows that there has been a decline in rainfall over the past five years. Since 1998, both rainfall and its frequency have shown a declining trend. Scarcity of rain has rendered most of the area barren with little or no vegetation.

14
Figure 4: Rainfall Pattern in District Tharparkar
Lack of rains has resulted in a decline in the cultivable area of the region. During the last 7 years the maximum cultivation took place during 1995-96. During 1999, there was no crop production in Tharparkar and the situation has not improved since then. During 2002 monsoons, grass did not last for more than two weeks, which resulted in scarcity of fodder for livestock and most of the livestock owners migrated to greener pastures in adjoining districts.
Sea Intrusion
Apart from drought, the coastal areas of Sindh are also badly affected by sea intrusion. Thatta and Badin district are among such areas. Between 2000 and 2002, the outflow of water released downstream Kotri Barrage declined which resulted in massive sea intrusion in Coastal areas of Thatta and Badin. This intrusion wreaked havoc not only on human and fish population but also damaged agricultural land badly. Economic activity in the region has halted since fishing is a major occupation of the population. Moreover, country is losing foreign sea food market every year due to depletion of fish and shrimp population in the region. The following Table 2.10 provides details on the affected areas.
Table 2.10: Details of Affected Area by Sea Intrusion
Location
Dehs
(#)
Talukas
(#)
Area affected (acres)
Channels Damaged (#)
Left Side of River
55
6
113,876
26
Right Side of River
32
3
51,957
21
Total
87
9
165,833
47
Source: Government of Sindh
Some of adverse effects of a reduction in freshwater flow to the Indus are listed below:
 Decrease in the availability of potable water
 Increased malnutrition and disease
Rainfall Pattern: District Tharparkar050100150200250199719981999200020012002Year Railfall (Millimeters) 01234567 Frequency (#) RainfallFrequency

15
 Reduction in fish population and mangroves
 Increased salinity and destruction of agriculture
 Increased poverty
 Massive out migration from coastal Talukas of Shah Bunder, Khorachan, Keti Bunder, Ghorabari, Jati and Mirpur Sakro
Destruction caused by sea intrusion can be combated by increasing the downstream flow into Kotri Barrage to at least 10 MAF and constructing an embankment in the coastal areas.
Cyclone and Recent Rains
Apart from sea intrusion, coastal districts have also been adversely affected by heavy rainfall and cyclones. The districts of Thatta and Badin are badly affected. Cyclone not only wiped out the human settlements and resulted in the huge losses of human and animal lives, but also destroyed and damaged fishing boats, therefore, badly affected the livelihood of majority of the residents of this area. Recent rains of 2003 monsoon in Sindh have affected around 411,000 acres of crop area while 18,500 kilometers of road infrastructure suffered huge losses. Roughly losses are estimated around 45 billion rupees. This estimate includes crop damage, damage to health, education and road infrastructure, damage to houses and destruction of irrigation facilities.
Lack of adequate Access and Mobility
Rural Communication have not been adequately connected with the socio-economic facilities. Sindh has 2nd largest coverage of all Provinces. Thus, rural population not appropriately benefiting from, health, education & income generation facilities. The per sq km area having 0.171 km paved/ all weather road, which is below the national average 0.370 km, per sq km. The economical mode of transport i.e. Rail, is hardly available. Sindh’s about 400 km feeder lines, which connect Rural areas with town/ big cities have been out of service.
The 20 communities still lack basic motorable access. 37% of communities have paved access, 40% of communities with basic access still lack regular public transport. The unserved village communities have to travel 4 km above on average to reach public transport.

16
Reduction in Development Expenditure
The data shows that poverty increased during the decade of nineties. Among the other the most
important factor; reduction in public sector development expenditure. Data reveals that
development expenditure in 1991 shared to 27% of total provincial budget, which dropped to
3.5% in year 2003 (Figure-5).
Likewise, annual Development Programme framed at Rs. 27 billion in 1991-92, which gone
down to Rs. 4.5 billion in year 2003 (Figure-6).
DECLINE OF ADP
0
1
2
3
4
5
6
7
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Rs in Billion
DECLINING DEVELOPMENT EXPENDITURE
0
5
10
15
20
25
30
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
%

17
The Characteristics of the Poor
Population Growth and Key Characteristics of Sindh
Population and its growth are the crucial determinants of overall welfare of the province. According to 1998 population census, 23 percent of Pakistan’s population lives in Sindh. Population of Sindh has increased rapidly (around 5-folds) since 1951. Population density of this province was 216 in 1998. The rate of change in population density in this province is higher than that of Punjab and NWFP. The population of this province has grown at an annual rate of 2.8 percent since 1981. If this growth rate remains the same then the population of this province will double by 2023. Sindh is the most urbanized province of Pakistan. Nearly 49 percent of Sindh’s population lives in urban areas. Karachi is the most populous district of Sindh and its 95 percent population lives in urban areas. Nearly 54 percent of total Sindh’s population lives in four districts: Karachi (32%), Hyderabad (10%), Larkana (6%) and Dadu (6%).
Household Composition and Demographics
The data of Population Census (1998) shows that 42.8 percent of Sindh’s population was less than 15 years of age, among them 2.12 percent were less than one year and 15 percent were less than 5 years. The proportion of women between ages 15-49 years was 22.5 percent. Crude birth rate was 33 per 1000 live births, total fertility rate was 4.7 per woman, contraceptive prevalence rate was 27 percent and infant mortality rate was observed 97 per 1000 live births in Sindh.
Household composition and demographic indicators differ between poor and non-poor households. Qureshi and Arif (2001) found that household size was positively associated with the incidence of poverty. Large households were more likely to be poor than the small households. They observed that the incidence of poverty for the largest households (more than 9 members) was three times more than the incidence for the smallest households (1-4 members). Table 2.11 reports household size and its composition in Sindh during 1998-99 for the poor and non-poor households.
This table observes that poor households are large in size. The average size of poor households was 9.09 against 6.16 for the non-poor households. Looking at age composition, this table shows that poor households have more children under 10 years of age. The relatively higher number of children is reflected in higher dependency ratios among poor households. Women’s age at marriage is significantly and negatively associated with the number of children. It has been observed that women of the poor households get married at much younger age than the women of non-poor households. Table 2.11 shows that 79 percent of women of poor households get married between the ages 15-19 years in Sindh in 1998-99. This proportion was highest in Sindh as than other provinces.
Table 2.11: Household Characteristics of Poor and Non-Poor in Sindh – 1998/99
Non-Poor
Poor
Household Size
6.16
9.09

18
Age composition
Age < 10
1.75
3.41
Between 10 and 18
1.20
1.95
Between 18 and 60
2.87
3.38
Age > 60
0.34
0.34
Dependency ratio
78.60
115.68
Urban areas
67.58
104.62
Rural areas
89.63
126.74
Women’s age at marriage
15-19 years
66.81
78.96
20-24 years
27.30
18.49
25-29 years
5.21
2.39
30-49 years
0.68
0.17
Source: PIHS (1998-99)
The SRDP (2000) report estimated that 47.4% of the total population of the five districts of lower Sindh were females. Life expectancy according to this study was 61 years for men and 60 for women. The proportion of girls is larger in the age group 0 to 4, however for the age 4 to 60 the proportion of girls declines sharply as compared to boys.
Performance of Social Indicators
Although the income and expenditure indicators of poverty exhibit poverty profiles to a certain extent yet they fail to give the complete picture if not complimented by non-poverty measures. Some of these measures are for instance are gross enrollment ratio, literacy level, access to safe water, health services etc.
Education
The performance of the education sector remained unsatisfactory in Sindh. There are wide gender and rural urban differences in education in Sindh. Table 2.12 reports the education statistics of Sindh by poor and non-poor.
This table reports the literacy rates of poor and non-poor household heads. In poor households the 36 percent heads were literate whereas this proportion was 61 percent in non-poor households. The difference between poor and non-poor is much higher in urban areas. World Bank (2002 SAC) reports that poverty headcount among those living in households with literate heads is around 21% in Sindh, compared to 42% for households where the head is not literate. A negative relationship between poverty headcount and educational attainment of head of the household has been found. Low levels of literacy among the poor households can also be seen through the difference in the proportion of population that has ever attended school. These differences in both urban and rural areas for poor and non-poor households are substantial in Sindh. Literacy rates and gross enrolment rates are also lower for the poor households in urban as well as in rural areas. However difference between poor and non-poor is more pronounced in urban areas.

19
Table 2.12: Education Statistics of Sindh--1998-99
Region
Non-poor
Poor
Overall
Proportion of literate household heads
Urban Sindh
72.06
43.74
68.98
Rural Sindh
50.04
33.09
45.49
Overall Sindh
60.92
35.70
55.94
Population that has ever attended school
Urban Sindh
73.41
48.36
69.77
Rural Sindh
39.42
27.16
35.47
Literacy Rate
Uban Sindh
70.8
46.5
69.0
Rural Sindh
36.7
24.8
35.0
Gross enrollment rate at the primary level (excluding katchi)
Urban Sindh
99.84
61.13
91.72
Rural Sindh
56.09
31.25
45.79
Large disparities also exist across income (using expenditure as a proxy for income). Table 2.13 provides information on the proportion of population that has ever attended school disaggregated by expenditure quintiles in 2001-02. This table also highlights the wide gender and rural-urban disparities. Considerable gender differences can be seen across expenditure groups. This disparity is higher in rural areas. The proportion of population ever attended school is higher and gender difference is lower among the higher expenditure groups.
Table 2.13: Population that Ever Attended School by Expenditure Quintiles - 2001-02
Expenditure quintile
Percentage of the population 10 years and older
Urban areas
Rural areas
Male
Female
Both
Male
Female
Both
Ist Quintile
62
36
49
41
7
25
2nd Quintile
60
39
50
54
14
35
3rd Quintile
69
50
60
57
17
38
4th Quintile
79
61
70
59
22
42
5th Quintile
89
73
81
71
24
50
Overall
77
59
68
54
16
36
Pakistan’s literacy rate in 2001-02 was 48 percent; 60 percent for males and 34 percent for females. In Sindh this rate was 46%. Female literacy rate is extremely low in rural areas of Sindh (14%) as compared to urban areas (54%). Table 2.14 shows literacy rates in Sindh by expenditure groups. According to this table, literacy rate of lowest expenditure quintile is more than half as compared to the highest expenditure group. Same trend can be observed for rural as well as urban areas. A significantly higher gender difference can be noted from this table for both urban and rural areas.

20
Table 2.14: Literacy Rate of Population Over 10 Years by Expenditure Quintiles
Expenditure quintile
Urban areas
Rural areas
Overall
Male
Female
Both
Male
Female
Both
Male
Female
Both
1st Quintile
53
29
41
38
6
23
41
10
26
2nd Quintile
56
35
46
50
13
32
52
19
36
3rd Quintile
64
46
55
53
15
34
57
26
42
4th Quintile
74
54
64
56
20
40
64
37
51
5th Quintile
87
72
80
69
20
46
81
55
69
Overall
74
54
64
51
14
33
60
31
46
[Note: literacy has been defined as the ability to read a newspaper and to write a simple letter.]
According to the SEMIS (2001), nearly 86 percent of Sindh schools were found functional, 13 percent closed and 1 percent were without the approval of SNE. Highest number of closed schools was found in Mirpur Khas and lowest in Karachi city. In Karachi 3 percent schools were without SNE approval. This report indicates that participation rate at primary and pre-primary levels was 53 percent in Sindh. Gender differences are more pronounced in all districts except Karachi district. Distrct Khairpur exhibits highest rate of participation and wide gender disparity (total enrolment rate 67%; boys enrolment 83% and girls enrolment 44%).
Gross enrolment rates at primary, middle, and higher levels in Sindh are reported in Table 2.15. Looking across expenditure quintiles, extremely wide disparities between lowest and highest expenditure groups are found at higher level. It is interesting to note that female enrolment at middle level in urban areas is higher than male enrolment across all expenditure groups. This table shows an exceptionally low enrolment for girls at higher level in lowest expenditure quintiles. For highest expenditure quintile, female enrolment at all levels is found higher in rural areas also.
Table 2.15: Gross Enrolment Rates by Level and Expenditure Quintile
Expenditure Quintile
Urban areas
Rural areas
Male
Female
Both
Male
Female
Both
Primary Level
.
1st Quintile
74
55
65
49
23
36
2nd Quintile
71
52
61
68
37
53
3rd Quintile
85
72
78
72
42
58
4th Quintile
98
94
96
87
44
64
5th Quintile
110
96
103
105
68
88
Middle Level
1st Quintile
27
31
29
18
2
12
2nd Quintile
31
43
36
35
6
21
3rd Quintile
38
57
46
35
11
23
4th Quintile
67
64
65
34
7
23
5th Quintile
85
89
86
51
26
40
Matric Level
1st Quintile
39
11
23
25
2
15
2nd Quintile
35
11
23
46
2
23

21
3rd Quintile
57
41
49
25
13
19
4th Quintile
61
59
61
58
24
44
5th Quintile
104
106
105
74
27
53
[Note: Gross enrolment rate at primary level is calculated as (number of children attending primary level (class 1 to 5) divided by number of children aged 5 to 9 years) multiplied by 100. This excludes Katchi class. Gross enrolment at middle level is calculated as (number of children attending middle level (class 6 to 8) divided by number of children aged 10 to 12 years) multiplied by 100. Gross enrolment at matric level is calculated as (number of children attending matric level (class 9 and 10) divided by number of children aged 13 to 14 years) multiplied by 100.]
The PIHS (2001-02) reveals differences in girl’s enrolment at primary level across income groups. Girl’s enrolment has been found positively associated with income not only in Sindh but also in other provinces. However, girl’s enrolment was observed higher in Sindh than NWFP and Balochistan and lower than Punjab in each income group.
Various studies note that the quality of education has positive impact on the cognitive achievements and hence on the post school productivity. Private schools are considered to impart quality education. These schools, however, charge higher fees. According to PIHS (2001-02), mean annual expenditure in private schools at primary level is Rs. 3001 against Rs. 821 in public schools. Therefore, only better off households can afford to send their children to private schools. Arif (2000) found that 32 percent children belonging to non-poor households were enrolled in private school against 11 percent of the poor households in Pakistan in 1998-99. In urban areas more than half of the enrolled children belonging to non-poor households were in private schools.
Table 2.16 shows substantial difference in the proportion of enrolment in government schools between 1st and 5th quintile, especially in urban areas of Sindh. The difference between 4th and 5th quintile is also pronounced in urban areas. This means that households prefer to send their children to private schools as their income increases. A negligible proportion of children belonging to the highest income group go to public schools in urban areas.
Table 2.16: Proportion of Government School Enrolment in Total Enrolment at Primary Level by Income Group- Sindh (2001-02)
Urban areas
Rural areas
Quintile
Male
Female
Both
Male
Female
Both
1st quintile
90
94
92
99
97
98
2nd quintile
83
65
75
96
98
97
3rd quintile
52
64
57
96
98
96
4th quintile
52
49
51
96
97
96
5th quintile
19
24
21
90
95
92
The Population Census (1998) provides district level information on literacy. According to this data, Karachi is on the top (almost 70%) in terms of literacy, followed by Sukkur (47%), Hyderabad (44%). In Sindh 6 out of 16 districts possess a literacy rate less than 30 percent. Tharparker is on the bottom with only 18 percent literate population. This data however shows gender differences in the levels of literacy in all the district of Sindh except Karachi.

22
Health
Like other provinces, health status in Sindh is not satisfactory. The estimated number of maternal deaths in the province was estimated 344 per month in 1998. Immunization coverage based on record was declined from 25 percent in 1995-96 to 15 % in 2001-02. This percentage was 45 on the basis of record and recall and 98 percent on the basis of recall. Table 2.17 presents the difference between poor and non-poor in relation to child immunization. The proportion of children fully immunized in Sindh in 1998-99 was 45 percent; 51 percent of non-poor and 28 percent of poor households. This table shows a considerable difference in the immunization coverage by poor and non-poor both in urban and rural areas.
Table 2.17: Percentage of Children Aged 1 to 5 years Fully Immunized- 1998-99
Region
Non-poor
Poor
Overall
Urban areas
70.92
48.10
67.0
Rural areas
36.26
22.14
31.43
Overall
50.98
27.97
44.57
Infant mortality is an important demographic indicator. In Pakistan, a decline in this indicator has been observed in overall Pakistan. A comparison of infant mortality rates in Pakistan and Sindh is presented in Table 2.18. One can note from this table that this rate was higher in Sindh as compared to overall Pakistan in 1998-99. The difference between rural and urban areas of Sindh is more pronounced. An improvement in infant mortality for females and a deteriorating situation for males can be seen in this table.
Table 2.18: Infant Mortality in Sindh (deaths per 1,000 live births)
1996-97
1998-99
Male
Female
Both
Male
Female
Both
Pakistan
101
108
105
93
85
89
Sindh
93
105
99
97
93
95
Urban Pakistan
82
85
83
77
68
73
Urban Sindh
73
75
74
63
76
69
Rural Pakistan
108
117
112
99
91
95
Rural Sindh
107
124
116
122
106
114
The prevalence of malnutrition has not been improved in Pakistan over the last 20 years. The estimated number of malnourished children was about 8 million in 1997-98. Nearly half of the children under 5 years of age were found underweight. A high incidence of malnutrition has been observed by Alderman and Garcia (1992) in four districts of rural Pakistan. They observed that by the time a child reaches the age of 5, he/she has a 62 percent probability of being stunted, a 45 percent probability of being under-weight and a 12 percent probability of being wasted. Surveying the same households after a gap of 10 years, World Bank (2002) observed complete lack of improvement in those four districts. Indeed, they found higher incidence of malnutrition. This study finds significant variations across provinces, Punjab being better than other provinces.

23
The incidence of low birth weight (LBW), despite being a very important determinant of child survival, has not been seriously investigated in Pakistan. Data is mostly derived from community-based studies in Pakistan. In order to find out more about maternal deaths and LBW, the Aga Khan University, in collaboration with UNICEF, conducted research in rural and urban Sindh. The urban sites were the adjacent areas of Landhi, Korangi and Bilal Colony while the rural sites comprised of communities of Chundko and Kot Diji. Phase 1 of the project revealed extremely low birth weights primarily due to malnutrition among mothers. Forty-five percent of the women suffered from vitamin deficiency while almost 70 percent of expectant mothers had anemia and iron deficiency.
Based on research conducted in Hala and Matiari Talukas of Hyderabad, Bhutta et.al (2003) reported that the infant mortality rate was 81 per thousand births. Most of these deaths occur within the first week of birth (55%) Some of the reasons suggested for lack of care seeking behavior were cultural barriers, lack of knowledge about the severity of disease as well as non availability of transport to reach the medical center in time and lack of attention by the medical staff.
The PIHS (2001-02) observes that in Sindh, 98 percent women are aware about the contraceptive methods whereas only 15 percent women are currently using any method. Nearly 19 percent women have ever used any method. Table 2.19 reports the contraceptive awareness and contraceptive prevalence rate across income groups in rural and urban areas of Sindh. This table shows no significant difference in the contraceptive awareness rate in urban and rural areas across income groups. However, the contraceptive prevalence rate shows a positive association with income in urban areas. In rural areas, a very small proportion of currently married women between ages 15-49 are found using any contraceptive method.
Table 2.19: Contraceptive Awareness and Contraceptive Prevalence Rates in Sindh (Percent of Currently Married Women of Age 15 - 49)
Income Group
Urban Sindh
Rural Sindh
Awareness Rate
Prevalence Rate
Awareness Rate
Prevalence Rate
1st quintile
99
20
94
4
2nd quintile
99
28
93
7
3rd quintile
99
38
93
7
4th quintile
100
32
92
7
5th quintile
99
42
94
8
Access to Education and Health Facilities
Among the number of factors that may be responsible for low indicators of education and health in Sindh, especially in rural areas, access to facilities is potentially important. Rural Sindh suffers from poor access to education and health facilities alike. For more than 74% of the population of rural Sindh, the distance to the nearest primary school for girls is greater than 1 km, compared to 21% of the population of entire rural Pakistan. In terms of access to girls' primary schools, rural Sindh ranks behind the rural region of every province, except for Balochistan. Given that Sindh

24
ranks on par with the rest of Pakistan on access to primary schools for boys, (with around 95% of the rural population living within I km. distance from the nearest school) the gender gap in rural access to schools is wider in Sindh than in the most parts of Pakistan, which may help explain why gender gaps in enrollments in rural Sindh are wider than for rural Pakistan as a whole.
On access to rural health facilities, the same story prevails. By any definition of health facility, rural Sindh ranks behind rural areas of every province except Balochistan. For example, around 63% of the rural population of Sindh live in villages that have at least one kind of medical facility or health worker, compared to 69% of the population of entire rural Pakistan. Access to family planning services also remains low in Sindh, which partly explains the relatively low rate of use of contraception.
In addition to access, the problem of quality is rampant in Pakistan, including Sindh. It is important to note that the measures that presented here do not account for the exclusion of certain social groups, which are also likely to have high concentration of poverty, from services and facilities. Both these problems can significantly reduce the effectiveness of services for the poor and disadvantaged groups, thereby affecting their potential to develop skills and enhance future economic opportunities.
Water and Sanitation
The poor households in Sindh suffer from lack of connectivity to a number of services, such as, water, toilet, drainage, electricity, gas, etc. This has direct implications for their human development. Available data reveals that the poor in Sindh have relatively low access to safe drinking water and sanitation facilities: they are less likely to use closed sources of drinking water, have toilets in the household, and be connected to a drainage system. As expected, the poor are also less likely to be connected to electricity and gas facilities. Availability of all these amenities is also characterized by large rural-urban gaps.
The source of drinking water used by a household is an important indicator of its well being. Table 2.20 presents the percentage distribution of households by main sources of drinking water in Sindh during the 1995-96 to 2001-02 period. This table shows that tap in house is the main source of water for urban households and hand pumps appeared as an important source of water for rural households of Sindh. It is very distressing to note that the number of households with tap in house has declined over time. Whereas the number of hand pump users has increased. In rural areas 10 percent households still derive water for drinking purposes from rivers/canals/streams.
Table 2.20: Main Source of Drinking Water—Sindh [ Percentage ]
1995-96
1998-99
2001-02
Source
Urban
Rural
Overall
Urban
Rural
Overall
Urban
Rural
Overall
Tap in house
71
9
39
58
6
29
59
3
26
Tap outside
6
1
4
6
1
3
8
1
4
Hand pump
11
53
33
17
50
25
14
66
44
Motor pump
3
5
4
9
4
6
11
4
7
Dug well
4
12
8
2
13
8
1
14
9

25
River, Canal, etc.
17
9
23
13
10
6
Other
5
2
3
9
3
5
8
1
4
Source: PIHS 2001-02
While there has been no overall improvement in terms of access to clean drinking water, the availability of toilet facilities has shown some improvement during 1995-96 to 1998-99 and deteriorating situation during 1998-99 to 2001-02. The type of toilet used by the household indicates the living condition and is significantly related to health and hygiene of the household members. The data at Table 2.21 shows that 30 percent households did not have any toilet facility in Sindh in 2001-02; 49 percent in rural areas and 3 percent in urban areas. This proportion was 24 percent in 1995-96.
Table 2.21: Nature of Toilet Facilities by Region—Sindh [ Percentage ]
1995-96
1998-99
2001-02
Source
Urban
Rural
Overall
Urban
Rural
Overall
Urban
Rural
Overall
Flush
82
11
45
92
14
49
91
17
48
Non-flush
12
36
24
5
28
18
7
34
23
No toilet
3
42
24
2
58
33
3
49
30
Source: PIHS 2001-02
Large rural-urban differences can be seen in the type of household sanitation services used in Sindh. For example, in urban areas, 69 percent houses are connected with underground drains while in rural areas, 85 percent houses do not have any drainage system and 12 percent houses have open drains. Table 2.22 shows the changing situation of sanitation in rural Sindh.
Table 2.22: Type of Sanitation System in Sindh [ Percentage ]
1995-96
1998-99
2001-02
Urban
Rural
Overall
Urban
Rural
Overall
Urban
Rural
Overall
Underground Drains
60
2
30
65
1
30
69
2
30
Covered Drains
-
-
-
6
0
3
2
0
1
Open Drains
33
23
28
22
12
16
19
12
15
No System
7
75
43
7
87
51
10
85
54
A similar situation can be seen in the garbage collection system in rural and urban areas of Sindh at Table 2.23. In urban areas, 43 percent households do not have any system and 43 percent households have a private system. In rural areas, 97 percent households do not have any garbage collection system. Most depressing things is that role of municipality is absolutely insignificant both in rural as well as in urban areas.
Table 2.23: Garbage Collection System in Sindh (2001-02) [Percentage ]
Urban
Rural
Overall
Municipality
14
0
6
Privately
43
2
19
No System
43
97
75

26
Household characteristics collected in the Population Census (1998) indicate that 57 percent households have only one room house in Sindh. 37 percent households have access to piped water, 70 percent have electricity and 34 percent do not have any latrine facility. Census data reveals that Tharparker is the most deprived off district in Sindh. In this district 26 percent population live in one room houses, 2 percent have piped water, 7 percent have electricity and only 22 percent have latrine facility. In districts Badin, Jaccobabad, Thatta and Ghotki a considerably higher proportion (more than 75%) lives in one room, a lesser proportion has piped water (less than 19 percent) and electricity (less than 65 percent) and a considerably higher proportion does not have any latrine facility (more than 50 percent).
Labour Force Participation and Employment
In Pakistan, two alternative methods are used to estimate the labour force participation rate; the Crude Activity Rate (CAR), and the Refined Activity Rate (RAR). CAR is the percentage of labour force in total population, and RAR is the percentage of labour force in population of persons 10 years of age and above. Labour Force Surveys reveal that the share of employed labour force in the population aged 10 years and above has fluctuated around 44 percent during the period 1968-69 to 1978-79. Since then this share is continuously declining and reached a low 39.45 percent in 1999-00.Table 2.24 reports the CAR and RAR in Pakistan and Sindh by gender and rural-urban areas. This table also reports females improved activity rate that includes their involvement in fourteen specified agricultural and non-agricultural activities. This table shows that labour force participation is lower in Sindh as compared to whole Pakistan, both for males and females and both in rural and urban areas. However, looking across years, this table reveals that both CAR and RAR in Pakistan and Sindh declined during 1997-98 and 1999-00. A significant decline in females improved participation rate has been noticed. Labour force participation rate in Sindh is lower than Punjab but higher than NWFP and Balochistan. However, female labour force participation rate in this province is lower than Punjab as well as NWFP. The main reason of low labour force participation is partly due to the fact that Pakistan is an agricultural economy with about 51 per cent of the employed population working in this sector. The estimation of labour force participation in the agriculture sector is always problematic because of the seasonal nature of the work and the fact that the possibilities for self- employment are much greater in the agriculture sector.
Table 2.24: Crude Activity (Participation) Rates By Sex, and Rural-Urban Areas (Pakistan and Sindh)
1997-98
1999-00
Both
Male
Female
Female
(New
Method)*
Both
Male
Female
Female
(New
Method)*
Pakistan
29.4
(43.3)
48.0
(70.5)
9.4
(13.9)
27.5
(40.7)
29.0
(42.8)
47.6
(70.4)
9.3
(13.7)
26.5
(39.2)
Sindh
26.5
(39.8)
46.5
(68.8)
4.1
(6.2)
29.4
(44.7)
25.4
(39.1)
44.4
(67.0)
4.4
(6.9)
20.3
(31.9)
Pakistan Urban
27.0
(37.7)
47.1
(65.2)
5.3
(7.4)
10.7
(15.1)
27.1
(38.1)
46.5
(65.0)
6.3
(8.8)
9.5
(13.4)

27
Sindh Urban
24.7
(35.1)
44.1
(62.3)
3.2
(4.6)
12.3
(17.6)
23.8
(33.9)
43.0
(60.4)
2.7
(3.9)
5.0
(7.2)
Pakistan Rural
30.6
(46.4)
48.4
(73.4)
11.5
(17.4)
35.9
(54.6)
29.8
(45.1)
48.2
(73.1)
10.7
(16.1)
34.3
(51.7)
Sindh Rural
28.5
(45.4)
48.9
(76.5)
5.0
(8.2)
48.0
(78.4)
26.9
(44.5)
45.6
(73.9)
6.0
(10.2)
34.4
(58.4)
Source: Labour Force Survey (1999-00)
[Note: Figures in parenthesis are Refined Activity Rates (RAR)
* According to the old methodology persons 10 years of age and above reporting housekeeping and other related activities are considered out of labour force. However, as per improved methodology, they are identified as employed if they have spent time on the specified fourteen agricultural and non-agricultural activities.]
The Labour Force Survey data reveals that 42.8 percent of the population is in the civilian labour force; 36 percent males and 6.68 percent females (see Table 2.25). Employed labour force in Sindh is less than that of Pakistan. However, proportion of employed males is higher in Sindh than overall Pakistan. However, the situation of employment in rural Sindh seems better than that of urban Sindh. A very high gender disparity can be seen from table 2.20; out of 38 percent employed labour force, 35 percent are males and only 3 percent were females in Sindh in 1999- 00. The percentage of employed females is higher in rural Sindh than urban Sindh. This may be due to the fact that a majority of rural females are engaged in agricultural or livestock related activities in rural areas.
Table 2.25: Percentage Distribution of Civilian Labour Force by Gender, Pakistan and Sindh (1999-00)
Civilian Labour Force
Employed
Unemployed
Total
Male
Female
Total
Male
Female
Total
Male
Female
Pakistan
42.80
36.12
6.68
39.45
33.93
5.52
3.35
2.19
1.16
Sindh
39.07
35.84
3.23
37.83
35.04
2.79
1.25
0.80
0.44
Urban Pakistan
38.14
33.91
4.23
34.35
31.38
2.98
3.78
2.53
1.25
Urban Sindh
33.94
32.11
1.83
32.58
31.10
1.46
1.36
1.00
0.37
Rural Pakistan
45.13
37.22
7.90
42.00
35.20
6.79
3.13
2.02
1.11
Rural Sindh
44.51
39.80
4.71
43.39
39.20
4.19
1.12
0.60
0.52
Source: Labour Force Survey (1999-00)
Unemployment rate also shows an increasing trend for Pakistan and Sindh. However, this rate is lower in Sindh; 3.1 percent in 1999-00 against 7.8 percent for whole Pakistan. There are number of reasons for high and increasing unemployment rates. For example, high rate of population growth, increasing levels of capital intensity in production through inappropriate choice of techniques, lack of technical education and training facilities, lack of education and the mismatch of available jobs with the skills and education that the existing system is producing. Because of the existence of underemployment, especially in agricultural sector, the unemployment rate may not depict the true picture of the unemployment situation. According to the official classification, persons working less than 35 hours per week are considered to be underemployed. According to the Labour Force Survey (1999-00), underemployment rate for Sindh was 8.5 percent; 11.5 percent in rural areas and 4.7 percent in urban areas.

28
The Population Census (1998) observes an extremely low participation of females (3% only). It is also found that nearly one-third of the population is engaged in agricultural activities. The proportion of agricultural labour force is observed to be higher in Badin (80%), Jaccobabad (71%), Shikarpur (80%) and Tharparkar (73%).
The available data shows a larger proportion of population is not economically active (nearly 57 percent of total population is not in civilian labour force). This inactive population mostly consists of women and children under the age of 15 years. According to the data of HIES (1998- 99), among the employed persons, there are 42 percent can be classified as heads of the households in Sindh (Table 2.26). This table shows that the proportion of female is 23 percent among the employed persons who are not heads of the household and less than 1 percent where female is head of the household. The share of income from heads of the households is higher than those who are not head of the household. Female’s contribution is only 0.62 percent if she is a head of the household and 10 percent if she is not head of the household. This table also shows that in rural areas there is a little difference between average incomes earned either by head of the household or any other member of the household. On the other hand, urban areas exhibit a larger difference between these two. The share of female income is found higher in rural areas.
Table 2.26: Distribution of Employed Persons and Their Monthly Income
Sindh
Rural Sindh
Urban Sindh
Employed
Average Income
Income Share
Employed
Average Income
Income Share
Employed
Average Income
Income Share
Head of Household
Total
42.08
3,540
63.78
39.38
2,624
61.53
46.38
4,702
66.64
Male
41.64
3,516
63.17
39.27
2,620
61.36
45.42
4,651
65.45
Female
0.44
25
0.62
0.11
4
0.17
0.96
51
1.18
Other Than Head of Household
Total
57.92
2,499
36.22
60.62
2,203
38.47
53.62
2,874
33.36
Male
35.24
1,879
25.52
32.59
1,449
24.27
39.44
2,424
27.10
Female
22.68
620
10.70
28.02
753
14.20
14.18
450
6.26
Source: HIES (1998-99)
Occupational status of the household head is another important factor likely to be associated with poverty. World Bank (2002) found that in urban Sindh, concentration of poor is higher than average among households whose heads are self-employed, no doubt reflecting the fact that a high proportion of such earners are engaged in elementary occupations in the large informal sector typically found in urban areas. Poverty incidence is lower among households headed by paid employees, who are likely to be engaged in skilled occupations in urban areas, and almost non-existent for those headed by employers who own enterprises.
Table 2.27 shows the employment status of the employed persons in Sindh. It can be noted from the table that a larger majority of employed persons in Sindh is working as employees (44%). Second largest category is of unpaid family helpers (27%). However the proportion of employees is higher in urban areas (68%) whereas in rural areas percentage of unpaid family helpers is higher than any other category (39%). The proportion of employed females is only 15 percent in urban areas and most of them are concentrated in the category employees. In rural area a large

Poverty Reduction Strategy for Sindh

Poverty Reduction Strategy for Sindh

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