Recent report of transparency international (TI) has ranked Pakistan on 120th number out of 180 countries of the world in the Corruption Perception Index compared to 117th in 2018. Though CPI is based on the assessment and perception of experts. The CPI has been constructed using 13 data source from 12 independent institutions specializing in governance and business climate analysis. However, this report has ranged the alarming bells that corruption is increasing under the state headship of Excellency Imran Khan that is against his party’s narrative of promoting merit and corruption free Pakistan. Transparency international report has highlighted that corruption is at its peak in the countries where money has been spent massively on election campaigns and government addresses the voice and problems of well-connected, influential and wealthy people. This reflects the lack of justice and security in these countries. If the government policies do not consider the needs and requirements of bottom tier group of people, then corruption will increase in an enormous amount that is far beyond our expectations. There are few key factors that increase corruption. For example if the economic activities are highly monitored, regulated and limited, the higher will be the influence of the officials in decision making and higher will be the corruption. Investors and entrepreneurs are willing to pay bribes and payments to up lift and avoid restrictions. Secondly, there exists a strong link between monetary policy and corruption. If the monetary policy is well-regulated, less will be the black market and corruption will be less. The current government’s top priority is to implement institutional reforms to make public administration and public offices efficient because these offices often provide fertile land to the corruption In spite of aforementioned reasons, if the country dearth the economic and political freedom, corruption increases drastically over the time. The current government’s top priority is to implement institutional reforms to make public administration and public offices efficient because these offices often provide fertile land to the corruption. But it should keep in mind that ineffective, lament and uncertainregulations and reforms increase level and growth of corruption. Nonetheless, a low level of income or wages or salaries of employees encourages corruption. Their weak financial position allows them to receive bribes that strengthen the roots of corruption and enhance it. Bottom line is that low salaries are not only the cause corruption but it also leads to inefficiency of public office as an outcome of political overcrowding. To tackle this problem, government should increase its direct tax revenues and raise the sensitivity of payment to performance for officials. Moreover it is well-known argument that poverty leads to corruption and prosperity treats corruption. It is reported that 24 percent of population lives below poverty line in Pakistan and 39 percent of population is suffering from multi-dimensional poverty. Economic theory says that corruption impacts economic activities which in turn leads to poverty. Moreover corruption hinders economic growth by discouraging domestic and foreign investment, distorts market, decreasing the cost of doing business, reducingentrepreneurs, lowering the quality of physical and social infrastructure, falling tax revenues, distracting public talent into rent-seeking activities and changing the structure of public expenditures. Moreover income inequality also increases corruption. Tax evasion, incompetent administration, and special exemptions supporting the wealthy and well-connected people lowers the tax base and progressivity of tax system, thereby increase income inequality which reduces economic growth and exacerbates poverty. If government wants to reduce corruption, it has to eradicate poverty first through social and welfare programs that will ultimately lessen the gap between rich and the poor. Besides all these, there is an immense need to pay attention on the development of social sector of the economy in term of better education and health in Pakistan. Countries with improved education and health sector have counted less evidences of corruption. For example Nordic countries are at the top of ladder in CPI with Denmark (87), Finland (86), Sweden (85), Norway (84) and Iceland (78) taking five of the top 11 places.Nordic countries are considered a benchmark in case of corruption free economies owing to better social sector development, social security and good business environment. An increase education in term of quality and increase in the proportion of women in every sector of economy particularly in government positions as well as in federal and provisional assemblies can curtail corruption exponentially. The writer is Assistant Professor, Institute of Economics, the University of Azad Jammu and Kashmir Muzaffarabad