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In a developing country like Pakistan, where there is low economic activity, education is the only vehicle for social mobility. However, education in Pakistan has always been very selective and elitist in nature. Unequal access to education has created multiple disparities in education. Similarly, low quality of education in public sector institutions has resulted in competitive disadvantage for poor communities and consequently they are being marginalised and “social and economic exclusion has resulted in multiple deprivation of more than 50 percent of Pakistan’s population”. This paper will analyse available date to show that education policy and practice in Pakistan has led to the widening of educational disparities, persistent inequalities and the exclusion of poor communities from economic life and social development.