ISLAMABAD, July 27: Increase in farm income further accentuates inequality because of skewed distribution of land in rural areas in the country as poverty rose from 25 per cent to 39 per cent during the period 1990-2002 , a research report by an eminent expert showed.

Yet, this very period experienced increase in agricultural growth rate of 4.6 per cent (more than double the population growth rate), making nonsense of the policy that puts most of the eggs in agricultural productivity for reducing rural poverty.

"Clearly", says Dr Sohail Jehangir Malik, a noted economist and chairman of Innovative Development Strategies, in his latest report, "the benefits of this agricultural growth did not translate into improved welfare for the least well-off segments of rural society".

Improvement in productivity can mitigate poverty only through equitable redistribution of land and other assets and focused policies to open new avenues of employment, it was emphasized.

The highest incidence of poverty prevails in zones that rely the most on crop incomes which account for 67.30 per cent of total income in areas of Sindh and 64.26 per cent of total income in the areas of (southern) Punjab producing mainly cotton and wheat.

But the poverty headcount in cotton/wheat Punjab jumped from 21.9 in 1987-88 to 55.51 in 2001-02, and that in cotton/wheat Sindh from 18.9 to 56.81. Both these zones are irrigated.

But then these are also characterized by extreme concentration of landholdings among feudals who reap all the benefits of higher production. Thus the World Bank in a 2002 study found the "highest incidence of vulnerability and chronic and transient poverty in the southern irrigated plains of Punjab and Sindh".

Agricultural production in Pakistan is highly erratic; one good year is either preceded or followed by bad year(s), making it impossible for small farmers to come out of poverty after a bad year even if it is followed by a very good year.

This is easily explained because 60 per cent of farming households own no land or own less than one acre, as Mr Malik found from his study of the reports of Agricultural Census Commission.

In fact, the incentives such as minimum support price of wheat redounds only to the enrichment of the already rich farmers at the cost of these households dependent on purchase of their basic food requirements from the market.

According to recent studies conducted in the World Bank and other institutions, cited by Mr Malik, Sindh and Southern Punjab are the poorest regions of Pakistan. During the period 1993-94 to 1998-99, poverty increased in all regions and during 1998-99 to 2001-02, southern and mixed Punjab as well as the NWFP were hit by the poverty.

Agricultural income accounts for only 25 per cent of total rural income. The rest comes from non-farm income (30 per cent), livestock (15 per cent) and transfer and rental income (30 per cent). The proportion of agricultural income in wages is negligible.

Making a short shrift of another stereotype in official jargon, research has found that the incidence of poverty was higher for those who depend solely on livestock and lower for those who can engage in both farming and livestock activities.

A higher incidence of poverty is reported among the non-farm households in all provinces of Pakistan, based on the Household Income & Expenditure Survey for 1993-94 and 1998-99.

According to other data for 1993-2001, farm poverty head count in rice/wheat Punjab increased from 21.6 to 24.9; in cotton/wheat Punjab from 19.9 to 42.1; in Barani Punjab from 15.7 to 24.2; in cotton/wheat Sindh from 33.4 to 59.3; in rice/other Sindh from 25.7 to 60.8; in the NWFP from 23.0 to 45.7; and Balochistan from 33.0 to 40.4.

As regards poverty in non-farm households, it increased in cotton/wheat Punjab from 31.4 to 55.6; in cotton/wheat Sindh from 34.2 to 57.7 and in rice/other Sindh from 27.1 to 53.0.

That the productivity being the panacea for poverty alleviation is a meaningless stereotype is brought home further by the research finding that "despite the overall increase in poverty, Barani Punjab continues to have the lowest levels of poverty" - 24.2 for farm and 25.2 for non-farm households.

This is also reflected in the lowest dependency ratio; highest levels of literacy, particularly women literacy; and lowest number of unpaid family workers. In Barani Punjab in 2001-02, wages and salaries were the highest component of income (56.94 per cent) followed by transfer income (29.26 per cent), compared to crop income whose share was only 13.02 per cent.

Households with no land depend on wages and salaries for 76.25 per cent of their total income, 20.11 per cent on transfer income, 1.47 per cent on livestock income and 1.43 per cent on crop income.

Likewise, for households with up to one acre, wages and salaries, transfer income, livestock income and crop income constitute 45.46 per cent, 24.07 per cent, 2.73 per cent and 26.73 per cent of their total incomes, respectively.

These and other poor households, Mr Malik observes, have lower levels of literacy, poor health status, limited access to basic services and amenities and higher levels of unemployment and underemployment.

In order to remove systemic poverty in Pakistan, he has called for measures to help these people diversify their incomes, an end to over-dependence on cotton and of the issue of concentration of land and other assets in a few families.