This document discusses income inequality in South Asia. It notes that income inequality is when a small percentage of the population controls a large share of wealth or income. The region of South Asia, which includes countries like India, Pakistan, Bangladesh, has some of the worst human development outcomes worldwide, with high rates of child stunting and mortality among the poor. The document presents statistics on income inequality levels in various South Asian countries and how inequality affects poverty rates and economic growth. It concludes that governments need tax reform and private sector development to reduce inequality and end poverty in the region.

2. Members
Muhammad Shahzaib
Chaudary Farhan
Nouman Asif
Sheikh Ehtisham
Syed Raza Shah

3. Topic
Regional income
inequality

4. Income inequality
 Income inequality is an extreme concentration of
wealth or income in the hands of a small percentage of
a population.
 It has been described as the gap between the richest
and the rest.

5. South Asia
 The current territories
of Afghanistan, Bangladesh, Bhutan, Maldives,
Nepal, India, Pakistan, and Sri Lanka form South Asia.

6. Cont…

7. Addressing Inequality in South
Asia
 Report launched in Islamabad, at a conference
organized by Pakistan Institute of Development
Economic (PIDE) on Poverty, Inequality and Economic
Growth.
 The report findings were presented by Martin Rama,
World Bank Chief Economist for South Asia and one
of the authors of the report.

8. Cont…
 South Asia has some of the worst human development
outcomes worldwide.
 The share of children under five who are stunted
among the poorest quintile is above 50 percent in
Bangladesh and Nepal and reaches 60 percent in
India.

9. Cont…
 India and Pakistan also have some of the highest
infant mortality rates and under-five child mortality
rates among the poor across all comparators
 Of 1,000 children born in Pakistan’s poorest
population quintile, 94 will die within 12 months and
120 within five years.

10. Statistical Figures

11. Cont…

12. Cont…

13. level of inequality
Income inequality :
 UNDP’s 2004 Human Development Report places the
Gini coefficient of Pakistan at 0.33 based on
consumption in 1999.
 The most recent (2000) World Bank estimate puts the
Gini ratio of India at 0.33, based on unadjusted per
capita expenditure.

14. Cont…
 (2004) estimates the income Gini in Pakistan at 0.40.
 WB and ADB (2002), using real per capita
expenditure, estimate the Gini coefficient in
Bangladesh at about 0.31.5
 The government estimate of the Gini of per capita
income in Nepal for 2000 is at a moderate 0.36

15. Cont…
Non-income inequality:
 The primary gross enrolment ratio for girls is lower in
South Asia than in East Asia, Latin America or the
Arab States.
 South Asia has the widest gap between the primary
enrolment rates of girls and boys.
 This reflects both cultural biases and the high
opportunity cost of girls’ home labour.

16. Trends in Inequality
– the Gini coefficient and the share of the
poorest 20% in total income.

17. Cont…
World Bank and ADB (2000)

18. Effects of Inequality
 In Pakistan, using time series regression for data from
1979 to 2002
 The level of inequality significantly affects the degree of
poverty as well as the growth elasticity of poverty.
 He estimates the elasticity of poverty to growth to be at -
3.51, and the elasticity of poverty to inequality as
measured by the Gini to be much higher, at 8.37.12

19. Conclusion
 Things need to change for South Asia to double its
growth to 9%.
 Unless governments can raise more tax by broadening
the base and spurring private sector development,
South Asia will not end poverty and boost shared
prosperity.