Authored by: Zulfiqar Shah and Muhammad Rafique

Impact of foreign debt on labour rights in Pakistan

Pakistan is a country of nearly 220 million people, and its population is expected to exceed 330 million by 2050. According to the 2017 Census, women account for 48.8 percent of the population, 40.3 percent are under the age of 15, and only 3.7 percent are aged 65 years or above. Hence, Pakistan has one of the world’s youngest populations. Urdu is Pakistan’s lingua franca, but the country’s largest ethno-linguistic groups include Punjabis (38.8 percent), Pashtuns (18.2 percent), and Sindhis (14.6 percent).

In 2021–22, Pakistan had a ranking of 161 on the Human Development Index (HDI). The country was categorized as having "low HDI," which is far lower than India (132, Medium HDI) and Sri Lanka (73, High HDI). In 2021, Pakistan scored 3.5 on the World Bank Country Policy and Institutional Assessment social protection rating and has consistently scored low since 2010; Pakistan is the worst performer on social protection among all South Asian countries except Afghanistan, according to the International Labour Organization (ILO). In addition, the country has the world’s second-highest number of out-of-school children, with almost 23 million children between the ages of 5 and 16 not attending school in 2016, representing 44 percent of the total population in this age group. Finally, only half of the country’s population has access to essential health services/Universal Health Coverage, which lags far behind the goal to boost the service coverage index to 80+ globally by 2030.

Pakistan’s total budget for 2022–23 was estimated at PKR 9,579 billion, of which PKR 1,052.2 billion was allocated for development. Pakistan’s Gross Domestic Product (GDP) growth increased significantly from –1.3 percent in 2020 to 6 percent in 2021. However, it is projected to shrink to 4 percent in 2022 and further to 3.5 percent in 2023 amid the ongoing flood devastation and the Government’s efforts to tackle fiscal imbalances. The country’s current account deficit widened from US$ 0.5 billion in 2021 to US$ 13.8 billion in 2022, whereas the trade deficit increased by 49.6 percent from US$ 22 billion in 2021 to US$ 32.9 billion in 2022.

Pakistan’s ranking on the World Press Freedom Index fell from 145 in 2021 to 157 in 2022. Freedom House declared Pakistan “not free” and assigned the country an internet freedom score of 25/100. Since 2021, the Pakistan Government has only intensified suppression of the media and voices of dissent, allowing the authorities to use draconian laws and practices against the media, civil society and political parties. Moreover, the World Justice Project’s Rule of Law Index placed Pakistan at 130 out of 139 countries in 2021, whereas the 2022 Global Gender Gap Report ranked it the second worst in terms of gender parity in the world. Furthermore, the 2020 International Trade Union Confederation Global Rights Index notes that there is no guarantee of rights for workers, while the Walk Free Global Slavery Index has ranked Pakistan 8 out of 167 countries, with over 3 million people estimated to be living in modern slavery. Furthermore, less than 1 percent of the labour force is unionized in Pakistan.



Impact of foreign debt on labour rights in Pakistan

Shah, Zulfiqar; Rafique, Muhammad

Impact of foreign debt on labour rights in Pakistan

Islamabad, 2023

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