grade levels but regressive at secondary and especially tertiary levels,” it says. “Equity requires committing additional resources to disadvantaged groups to offset their otherwise more limited access to basic services.”
Social protection spending is largely progressive across the region, the study says, appreciating the achievements of the world’s largest public works program in India and the income support program of Pakistan.
“However, the coverage of social protection programs in South Asia is partial, their targeting is generally poor, and the amount of resources they make available to those who need them the most is often too modest,” it says.
“Across all countries in the region, 60 percent to 80 percent of the beneficiaries are not poor, and they receive between 50 percent and 80 percent of the funding.”
As far as the energy subsidies are concerned, according to the finding, the wealthy turns out to be the biggest beneficiary.
The report says the energy subsidies eat into four percent of GDP in Pakistan and Bangladesh as against two percent in Sri Lanka and India.
“In the case of Pakistan, the poorest 40 percent of households used to receive less than 30 percent of total electricity subsidies, while the richest 20 percent received close to 40 percent of total subsidies,” it says.
Despite some improvement, it adds, “electricity subsidies remain regressive”.
While subsidies are massive government tax collection is not impressive. The tax receipts are much below the actual potential, while only a small portion of the registered taxpayers are filing their income tax returns.
“This situation clearly points to weak tax enforcement by the Federal Board of Revenue,” the report says.
It adds that poor in Pakistan pay almost as much tax as the middle class.
The low-income group has developed its own coping strategies to defy an economic shock, like food price inflation. Selling an agriculture asset is one of them, which is tantamount to compromising “long-term ability to earn an income”.
The report adds, “In contrast, the wealthiest groups are much less likely to use these mechanisms.”
The World Bank says South Asia has still the moderate levels of inequality based on standard monetary indicators.
However, “Despite not being the poorest region in the world, the region has some of the worst human development outcomes worldwide,” it adds.
Inequality is one of the seven debating issues in the annual four-day meeting of World Economic Forum in Swiss Alpine resort of Davos.
The gathering started on Wednesday through 24th January. It is not the first time that this theme is selected to invite attention of the world leaders for addressing the inequality. For several years, the rally has been discussing this, but the progress is said to be ‘disappointingly slow’.
Anti-poverty charity Oxfam has already forewarned if the gap between rich and poor is not narrowed one percent best-off will have half of the world’s wealth by the next year.