Pakistan Middle Class Jumps to 55% of Population

[Riaz Haq]

Majority of the households in Pakistan now belong to the middle class, a first in Pakistan's history, according to research by Dr. Jawaid Abdul Ghani of Karachi School of Business and Leadership (KSBL).

It's an important tipping point that puts Pakistan among the top 5 countries with fastest growing middle class population in Asia-Pacific region, according to an Asian Development Bank report titled Asia's Emerging Middle Class: Past, Present, And Future. The ADB report put Pakistan's middle class growth from 1990 to 2008 at 36.5%, much faster than India's 12.5% growth in the same period.

Source: Dr. Abdul Ghani

From 2002 to 2011, the country's middle class, defined as households with daily per capita expenditures of $2-$10 in 2005 purchasing power parity dollars, grew from 32% to 55% of the population, according to a paper presented by Dr. Abdul Ghani at Karachi's Institute Business Administration's International Conference on Marketing. Dr. Ghani has cited Pakistan Standards of Living Measurement (PSLM) Surveys as source of his data.

Source: Dr. Abdul Ghani, Karachi School of Business

Growing middle class is a major driver of economic growth, as the income elasticity for durable goods and services for middle class consumers is greater than one, according to a Brookings Institution study titled The Emerging Middle Class in Developing Countries.

Among some of the manifestations of the rising middle class, Dr. Abdul Ghani reports dramatic increase in the ownership of television sets, refrigerators and motorcycles in households in all income deciles in Pakistan.  At the same the total household assets have nearly doubled from $387 billion in 2001-02 to $772.6 billion in 2010-11 in terms of 2005 purchasing power parity dollars.

Consumer spending in Pakistan has increased at a 26 percent average pace the past three years, compared with 7.7 percent for Asia, according to data compiled by Euromonitor International, a consumer research firm. Pakistan's rising middle class consumers  in major cities like Karachi, Lahore and Islamabad are driving sales of international brand name products and services.  Real estate developers and retailers are responding to it by opening new mega shopping malls such as Dolmen in Karachi and Centaurus in Islamabad.

Pakistan's transition to middle-class middle-income country over the last decade mainly during Musharraf years represents a major tipping point for the country's economy. It is likely to accelerate economic growth driven by consumption and draw greater investments in production of products and services demanded by middle class consumers. Some of it is already in evidence in booming sales of durable goods (TV sets, refrigerators, motorcycles) AND non-durables (cosmetics, shampoo, toothpaste, processed foods, etc) in Pakistan's booming FMCG sector.

Related Links:

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Pakistan's Official GDP Figures Ignore Booming FMCG Sector

Musharraf Accelerated Human and Economic Development in Pakistan

Pakistan's Growing Middle Class

Pakistan's GDP Grossly Under-estimated; Shares Highly Undervalued

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3G-4G Roll-out in Pakistan

 

Pakistan Government Deploys Mobile Apps

 

Telecom and Media Boom in Pakistan

 

Mobile Money Revolution in Pakistan

[Riaz Haq]

Mani Shankar Aiyar: What #India's #Modi Has Not Recognised About #Pakistan: ITS RESILIENCE AND NATIONALISM http://www.ndtv.com/opinion/pakistans-resilience-beats-modis-56-inc... … via @ndtv

Note: Mani Shankar spent some time in Pakistan posted as a diplomat, serving as India's first consul-general in Karachi from 1978 to 1982. He's a former federal cabinet minister and current member of Rajya Sabha

"unlike numerous other emerging nations, particularly in Africa, the Idea of Pakistan has repeatedly trumped fissiparous tendencies, especially since Pakistan assumed its present form in 1971. And its institutions have withstood repeated buffeting that almost anywhere elsewhere would have resulted in the State crumbling. Despite numerous dire forecasts of imminently proving to be a "failed state", Pakistan has survived, bouncing back every now and then as a recognizable democracy with a popularly elected civilian government, the military in the wings but politics very much centre-stage, linguistic and regional groups pulling and pushing, sectarian factions murdering each other, but the Government of Pakistan remaining in charge, and the military stepping in to rescue the nation from chaos every time Pakistan appeared on the knife's edge. The disintegration of Pakistan has been predicted often enough, most passionately now that internally-generated terrorism and externally sponsored religious extremism are consistently taking on the state to the point that the army is so engaged in full-time and full-scale operations in the north-west of the country bordering Afghanistan that some 40,000 lives have been lost in the battle against fanaticism and insurgency.

"And yet," as was said on a more famous occasion, "it works!" Pakistan and her people keep coming back, resolutely defeating sustained political, armed and terrorist attempts to break down the country and undermine its ideological foundations. That is what Jaffrelot calls its "resilience". That resilience is not recognized in Modi's India. That is what leads the Rathores and the Parrikars to make statements that find a certain resonance in anti-Pakistan circles in India but dangerously leverage the impact on Pakistani public opinion of anti-India circles in Pakistan. The Parrikars and the Saeeds feed on each other. It is essential that both be overcome.

But even as there are saner voices in India than Rathore's, so also are there saner - much saner - voices in Pakistan than Hafiz Saeed's. Many Indians would prefer a Pakistan overflowing with Saeeds to keep their bile flowing. So would many Pakistanis prefer an India with the Rathores overflowing to keep the bile flowing. At eight times Pakistan's size, we can flex our muscles like the bully on the school play field. But Pakistan's resilience ensures that all that emerges from Parrikar and Rathore are empty words. India is no more able than Pakistan is to destroy the other country"


http://www.ndtv.com/opinion/pakistans-resilience-beats-modis-56-inc...

[Riaz Haq]

Indian Diplomat Sharat Sabharwal on Pakistan's "Resilience", "Strategic" CPEC, China-Pakistan "Nexus"

http://www.riazhaq.com/2022/08/indian-diplomat-sharat-sabrhawal-on....

Retired Indian diplomat Sharat Sabharwal in his recently published book "India's Pakistan Conundrum" disabuses his fellow Indians of the notion that Pakistan is about to collapse. He faithfully parrots the familiar Indian tropes about Pakistani Army and accuses it of sponsoring "cross-border terrorism". He also writes that "Pakistan has shown remarkable resilience in the face of adversity". "Pakistan is neither a failed state nor one about to fail", he adds. He sees "limitations on India’s ability to inflict a decisive blow on Pakistan through military means". The best option for New Delhi, he argues, is to engage with Pakistan diplomatically. In an obvious message to India's hawkish Hindu Nationalist Prime Minister Narendra Modi, he warns: "Absence of dialogue and diplomacy between the two countries carries the risk of an unintended flare-up". Ambassador Sabharwal served as Indian High Commissioner to Pakistan from 2009 to 2013. Prior to that, he was Deputy High Commissioner in Islamabad in the 1990s.

[Riaz Haq]

Fast Food: 2nd largest
industry in Pakistan
by Prof. Dr. Noor Ahmed Memon, (Dean KASBIT).

How big is the fast food industry in Pakistan?
Fast Food Industry in Pakistan is the 2nd largest in Pakistan. accounts for 27% of its value added production and 16% of the total employment in manufacturing sector with an estimated 180 million con- sumers, Pakistan holds the world's eighth largest market when it comes to fast food and food related business.

http://foodjournal.pk/2016/July-August-2016/PDF-July-August-2016/Ex...

[Riaz Haq]

Four key trends - Newspaper - DAWN.COM

https://www.dawn.com/news/1766451

By Umair Javed


The cultural indicators are about how people understand the world around them and the degree to which they are engaged with it. The first of these relates to consumption of information, especially among young people, who constitute a majority in the country. For this, we can turn to Table 40 of the last census, which reports that 60 per cent of households rely on TV and 97pc rely on mobile phones for basic information. The corresponding figures in 1998 were 7pc and 0pc respectively.

What this overwhelmingly young population is watching on TV or through their mobiles is something that we can never completely know. But what is clear is that a lot of information is being accessed, and a lot of ideas — about politics, about religious beliefs, and about the rest of the world — are circulating. Controlling or regulating this flow is an impossibility. Will it lead to an angrier population or a more passive one? A more conservative one or one with some transgressive tendencies? So far, the outcome leans more towards anger and conservatism.

Another slow but steady sociocultural transformation is the vanishing gender gap in higher education. Men and women between the ages of 20 and 35 have university degrees at roughly the same rate (about 11pc). Between 20 and 30, a slightly higher percentage of women have a college degree compared to men. And just two decades ago, women’s higher education attainment in the same 20 to 35 age bracket was 3pc lower than men. This gap has been covered and there are strong signs that it will reverse in the other direction as male educational attainment stagnates.

What does a more educated female population mean for societal functioning? Will these capabilities threaten male honour (and patriarchy) in different ways? Will there be new types of gender politics and conflicts? And will the levee finally break in terms of the barriers that continue to prevent women from gaining dignified remunerated work? As in other unequal countries, Pakistani men hold a monopoly over economic benefits and public space. And they are unlikely to give these privileges up passively.

In the socioeconomic domain, there are also two things worth highlighting. The first is urban migration, not just in large metropolitan centres, but in smaller second- and third-tier cities as well. Fragmenting land holdings and climate change are compelling young men in particular to move to cities in large numbers. A 10-acre farm inherited by five brothers will lead to at least three seeking work outside of agriculture.

The official urbanisation rate may be at around 38pc but this is a significant underestimate. Many villages are now small towns, and small towns are now nothing less than large urban agglomerations. The perimeters of these urban areas are dotted with dense informal settlements that provide shelter — often the only type available — for working-class migrants.

Finally, the last trend is employment status in the labour force. In the last 20 years, the percentage of people earning a living through a daily/weekly/monthly wage (as opposed to being a self-cultivator, self-employed, or running a small business) has increased by 10pc. Much of this increase is taking place in the informal economy and that too in the services sector.


Starting your own business, however small, requires money, which most do not have. Getting higher-paying, formal-sector jobs first requires getting credentials and training, which again is beyond the budget of most. Large swathes of the working population will grind out a living by taking care of the needs of the better off — fixing their cars, cleaning their houses, serving them food. Given the condition of the economy, this trend is unlikely to change.