Inadequate sanitation causes Pakistan economic losses totaling $5.7 billion (Rs343.7 billion) each year. This is equivalent to 3.9 percent of the country’s Gross Domestic Product (GDP), according to a new report published by the Water and Sanitation Program (WSP), a multi-donor partnership administered by the World Bank.
The report, the Economic Impacts of Inadequate Sanitation in Pakistan, is based on evidence on the adverse economic impacts of inadequate sanitation, which include costs associated with death and disease, accessing and treating water, and losses in education, productivity and time.
The report shows that the largest share of losses- Rs299.6 billion ($4.9 billion) amounting to 87.2 percent of the total economic cost- is due to premature mortality and other health-related impacts due to poor sanitation. This includes costs related to premature mortality, productivity loss due to illness and cost of treatment.
In Pakistan, diarrhea is the largest contributor to health-related economic impacts resulting from poor sanitation, amounting to almost two-third of the total health-related impacts. 63 percent of the premature mortality-related economic losses out of the total economic impact are due to deaths and diseases among children under five.
Diarrhea among children under five accounts for Rs121.5 billion ($2 billion), amounting to 40.5 percent of all health-related economic impacts. This is followed by acute lower respiratory infections, which account for about Rs25.2 billion ($ 414.9 million), amounting to 8.4 percent of all health-related impacts.
The water-related (poor sanitation) economic cost is estimated at Rs16 billion ($262.7 million), which includes costs related to bottled water, household treatment and pipe-water cost.
The report also estimates welfare costs at Rs22.8 billion ($374.4 million) which includes time-lost to illness due to defecating in the open. The economic cost for loss of tourism is estimated at Rs5.4 billion ($84 million).
“The total amount of the losses caused by poor sanitation in Pakistan is 7 times higher than the national health budget and 3.5 times higher than the national education budget, said Rachid Benmessaoud, World Bank Country Director for Pakistan. “These figures have caught the attention of policy makers and Pakistan has already started the development of federal and provincial policies”.
“Similar studies carried out in East Asia, Africa and elsewhere in South Asia indicated annual per capita losses of $28.6 in Indonesia, $29.6 in Bangladesh and $20 in Nigeria,” said Christopher Juan Costain, Regional Team Leader for WSP in South Asia, adding that Pakistan’s loss per capita is Rs2,160 ($35.5).
“For decades we have been aware of the significant health impacts of poor sanitation. This report not only puts a number on health losses, but also identifies and quantifies areas where sanitation takes a toll,” he said.
The report underlines that substantial investments are needed to improve sanitation. Poor sanitation needs to be given priority treatment at all administrative levels—local, provincial, and national—and investments should be made to build moderately improved and hygienic latrines in both urban and rural areas.
These investments could include increased sanitation coverage, as already targeted in various government policies. This rising trend in the government’s budgetary allocation to sanitation indicates a strong commitment to improve sanitation outcomes.
The report shows that sanitation and hygiene-related improvements will reduce premature deaths and related morbidity, limit domestic water-related costs, reduce absenteeism at schools and workplaces, and improve welfare and productivity.