Poverty remains a persistent challenge in Pakistan, where structural inequality, social vulnerability, and fiscal constraints continue to limit the effectiveness of welfare interventions. This study examines how social protection contributes to poverty alleviation through targeted subsidies in Pakistan’s welfare sector, with particular attention to the direct effects of social protection and targeted subsidies and the mediating role of subsidies in this relationship. A quantitative explanatory design was employed using purposive sampling. Data were collected through structured questionnaires from 303 respondents drawn from key welfare institutions and beneficiary groups, including BISP, Ehsaas, Zakat, and Bait-ul-Mal programs. The data were analyzed using Structural Equation Modeling with Partial Least Squares (SEM-PLS) to test the hypothesized direct and indirect relationships among social protection, targeted subsidies, and poverty alleviation. The findings show that social protection has a strong positive effect on targeted subsidies and a significant direct effect on poverty alleviation. Targeted subsidies also have a significant positive effect on poverty alleviation and partially mediate the relationship between social protection and poverty alleviation. These results indicate that broad social protection frameworks are more effective when translated into well-targeted subsidy mechanisms. The study concludes that integrated, transparent, and accurately targeted welfare policies can strengthen poverty reduction outcomes and offers practical guidance for policymakers seeking more effective and inclusive social protection systems in developing contexts while improving program delivery, institutional trust, and sustainability of national welfare reforms.
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