Designing a policy for pro poor growth involves addressing the structural features of Pakistan’s growth process which constrain its capacity at the macro level for poverty reduction. At the same time it is necessary to come to grips with the nature of the poverty process at the local level. Poverty occurs when the individual is isolated from the community and is locked into a nexus of power, which deprives the poor of their actual and potential income. The poor face a structure of markets, state, and institutions, which discriminate against their access over resources, public services and government decision-making1 . In this context overcoming poverty means empowering the poor at the local level. The challenge of pro poor growth therefore is to re-orient both the structure of the economy as well as the local structures of power in favour of the poor.