Pains of high prices

An upsurge in prices of petroleum products, natural gas and electricity with across-the-board impact on cost of production, transport and essential commodities has come at a time when the official inflation rate is getting closer to double digit figure and is losing its creditability in the face of the rising cost of living. According to reports, market sentiments have pushed sugar prices to Rs28 per kilo from Rs22 per kilo recorded last month despite stocks of 1.5 million tons with sugar mills and the import of sugar amounting to 250,000 tons stated to have been largely cornered by the hoarders.

Similarly, skyrocketing prices of cement, a key building material, along with steel, have made house building unaffordable for so many in the middle and low-income groups. On Thursday, KESC tariff rates were raised by three paisa per unit for all categories except big consumers. A further increase is on the cards with the utility about to be transferred to a private owner. Last week, gas prices were hiked by 8.25 per cent and petrol prices increased by Rs2 per litre.

Despite their adverse impact on the poor segments of the population, the recent increases in diesel and kerosene prices have been higher than that of high octane petrol used by the affluent. Prices of various commodities used by the common people unrelated to cost of energy are also rising with no effective step being taken by the government to reverse the trend.

The government seems to be indifferent to the plight of the poor and the middle class who find it increasingly difficult to make both ends meet with soaring prices of foodstuff, including wheat. The problem is getting serious day by day. The reasons for high prices are many and varied, starting from a monetary policy which has failed to check rapid growth in private sector credit, a part of which is being extensively used for hoarding commodities and in speculative investment in stocks and real estate.

Neither increased production, cheaper imports of industrial raw materials and other inputs nor the benefits of cheap credit are passed on to the consumers. The market is in the grip of a speculative fever with potential for harming the economy. It is easier to curb inflation at the initial stages when the inflationary expectations are not very strong. A high economic growth rate becomes meaningless when a high inflation rate saps the purchasing power of the consumers. Too much concentration of the resources in few hands amidst growing poverty carries the risks of generating recessionary trends.

As occasionally suggested by the State Bank of Pakistan, there is an urgent need to update competition law to break up cartels, alleged to be operating in sugar and cement markets. The Monopoly Control Authority, a toothless body, needs to be made effective, independent and autonomous to protect the interest of the consumers.

Over the years the government has resorted to ad hoc measures neglecting centralized planning, long-term policies and programmes, which could be implemented primarily by the private sector to remove imbalances in the economy and overcome the problem of shortages. As energy price hikes indicate, the government cares little for the consumers who are passing through very difficult times.

It has ignored an urgent need to ease the burden of high prices on them. Its apathy and indifference is assuming alarming proportions. It may lead to heavy social costs unless fruits of economic progress are widely shared and prices stabilized.

Commonwealth concern

The Commonwealth Ministerial Action Group has expressed its "serious concern and regret that President Musharraf had not met his commitment to relinquish his role as chief of army staff", but otherwise gone along with the dual-office aberration. The ministers said only that they expected the two offices (of president and COAS) not to be combined in the same person beyond the end of the current presidential term in 2007 at the latest.

They noted that the president had been authorized by parliament to retain both offices, thus implying that legislative procedures had been followed in sanctioning the arrangement. The year 2007 is a long way off. What happens by then is anybody's guess. The president may himself get tired of wearing his military uniform or circumstances may occur - a political deal with the opposition, for instance - that make it unnecessary for him to hold the army chief's office.

Actually, the dual-office contrivance is by and large now taken for granted by the international community. Washington has been particularly evasive about it. Even domestically it is seen as a fait accompli. If there is to be a compromise between Gen Musharraf and the mainstream parties, the government would probably insist on the politicians accepting the existing arrangement till 2007 in return for some form of participation in political life. But none of this can really give democratic legitimacy to the president's retention of his army office.

It is seen by all democrats as institutionalizing the military's interventionist role in politics. Acceptance of a certain reality does not necessarily make that reality palatable or desirable, and the moral pressure for a return to undiluted civilian, representative rule and removal of all distortions from the 1973 Constitution will have to be kept up. Movement towards this is necessary to improve the political environment and lessen the polarization and conflict that have been our lot recently.

Sorting out cricket matters

The Pakistan cricket team's much-anticipated tour of India begins in less than a fortnight but the cricket boards of both countries need to sort out quite a few issues soon. One relates to the broadcasting rights of the series which was recently the subject of a controversial legal battle in India. There are two other aspects of the tour, however, which directly concern Pakistan.

The first and foremost has to do with the Pakistan Cricket Board's reservations about holding a Test match in Ahmedabad and the fact that the city is in Gujarat where over 2,000 Muslims died in communal violence in 2002. Besides, the state continues to be governed by a chief minister who is known for making several very anti-Pakistan comments. Understandably, the PCB has reservations about holding a five-day match in the city because of the hostile climate there for the Pakistani team.

It would be good if, instead of insisting that the Pakistanis play at Ahmedabad, the Indian cricket board took this into account and decided on an alternative venue. After all, the PCB did precisely that when the Indians came last year and refused to play a Test at Karachi, which was then allotted a one-day international. This matter is straightforward enough not to warrant, as some news reports suggest, intervention at the government level.

The other unresolved issue relates to team selection, with a debate raging us to whether fast bowler Shoaib Akhtar should be included in the team. Statistically speaking, he has been Pakistan's most penetrative and successful bowler in the past year and, as pointed out by Imran Khan, could prove to be a very valuable asset against the Indian batsmen who are far better players of spin than of genuine fast bowling.

However, he does have some matters to sort out regarding his attitude and discipline, and seems to have frequent fitness problems. With a gruelling and testing tour of Australia behind them, and another tough one around the corner, it would be good for Pakistan's cricketers if these matters were quietly sorted out soon.