Growth-Poverty Linkage and Income-Asset Relation in Regional Disparity: Evidence from Pakistan and India (The Allama Iqbal Memorial Lecture)

The purpose of this paper is to discuss the importance ofincorporating asset holding and its distribution into the study ofgrowth-equity relationship in the context of regional disparity. We havetried to discuss this issue by taking the Inclusive Growth Strategy(IGS) introduced by the Union Government of India in 2006. Although itis too early to assess the impact of IGC at this stage, the followingsare some of the important findings of our analysis. First, theperformance of the post-reform period is characterised by the highereconomic growth and declining poverty ratio on one hand, and theincreasing disparity in terms of consumption, income and asset holdingon the other. Second, the magnitude of poverty and disparity is muchmore evident in asset holding, notably land, as compared withconsumption and income, among economically and socially disadvantageoussegments of rural communities. Third, if the inherent social inequalitywere overcome in the growth process, access to asset, notably land, hasto be facilitated either by political process or through markettransaction. In either case, the prospective is not yet bright. Thepaper strongly advocates, among others, the necessity of incorporatingincomeasset relationship and structural aspects in discussing povertyand disparity issues in development. Keywords: Growth-Poverty Linkage,Income-Asset Relationship, Inherent Social Inequality, Inclusive GrowthStrategy, Land Market, Capital Gain, Land Reform, Rent-land Price Ratio,Ginicoefficient.