KARACHI: The trend of inflation in food items has been on rise for the last four years, while prices of domestic appliances, television, clothes, kitchen utensils, etc., have either remained pegged to their old levels or dropped, thanks to the rising competition following the entry of Chinese items in the market.
Notable increase had been witnessed in the price of atta No 2.5, rising to Rs14-15 per kg in 2005 from Rs10 per kg in 2001, while prices of five-kg ghee and cooking oil tin surged to Rs395, from Rs325 four years back.
Loose milk price escalated to Rs28 from Rs22 a litre, while makers of powdered milk brought their rates at par with loose milk to Rs230 for one kg pack, from Rs183 in the last four years. One litre milk pack price rose to Rs33 from Rs28.
Irri-6 rice price peaked to Rs15 from Rs12.50 per kg, while basmati number one price increased to Rs34 from Rs28 per kg. Sugar price rose to Rs26 from Rs18 per kg in 2001, while big toilet soap price peaked to Rs22 from Rs18. Small pack soap rice rose to Rs15 from Rs12.
Pulses prices were dependent on the demand and supply, crop and import situation, also showed a rising trend. Moong was now selling at Rs36 as against Rs25, while masoor skyrocketed to 48 from Rs32. Gram pulse rates remained unchanged at Rs30, despite depicting fluctuation in the last four years.
Beef and mutton became costlier to Rs120 and Rs220 from Rs90 and Rs180, respectively, in 2001 owing to a halt in arrivals of livestock from Indian border, smuggling of animals to Afghanistan and Iran and export of meat to Gulf and Middle East countries.
Tea packet Tapal Danedar 200gm, which was available at Rs49 in 2001, now cost Rs52. Mitchell Squash rate rose to Rs60 from Rs52, while jam was now available at Rs50 as against Rs39. Detergent powder one-kg bag price went up to Rs125 from Rs99.
Rising cost of raw materials, import, transportation charges, utility bills, production, crop situation, etc., are the factors responsible for the fluctuation in prices of essential commodities.
This is the scary side of inflation that has adversely affected the monthly spending estimates of consumers who now prefer buying things in little quantities instead of procuring them in bulk. Multinationals and local producers have been quick enough to gauge the buying sentiments of the consumers and responded by introducing items in small packs.
It was assumed that rising inflation would have a negative impact on the financial health of local companies and MNCs in terms of sales but it had not happened as their sales had increased manifold. They introduced ‘ticky packs’ to increase sales and meet rising demand of increasing population.
“A person with a five-member family is now paying Rs500-1,000 more to buy essential items as compared to 2001,” general-secretary, Karachi Retail Grocers Association (KRGA), Farid Qureishi, says, adding the consumers now prefer buying goods in little quantities to meet their timely requirement instead of making bulk purchase for the whole month.
As far as consumer rights are concerned, there is no authentic body or council that could fight for the consumers’ right, particularly in the case of rising prices of essential items. A few consumer protection bodies exist but their activity is limited. In the absence of any resistance on the part of consumers in times of price hike, market forces — local producers, retailers and wholesalers — have enjoyed complete liberty in driving the prices on their own.
Coming to domestic appliances, the entry of Chinese items at cheaper rates has opened new buying avenues for consumers. “The price of domestic appliances has been 10 per cent less as compared to 2001,” Dawlance Group director Shakeel Ahmed says. International prices of household appliances also plunged in 2002-03, while local fridge and deep-freezer makers have expanded their business and reduced cost. Finally the consumers have benefited from the intense competition among local players in the shape of price fall.
He says China marked its entry in 2001 with the introduction of cheap A/C that has now been replaced with split A/C. “We have increased the price of domestic appliances by a scant amount of Rs300-500 due to rising steel and plastic prices in international markets, but the rate is still cheaper as compared to 2001,” Mr Ahmed says.
Similar is the case with colour television whose rates have been coming down since Chinese TV has made deeper inroads to the market at affordable rates. Another reason of price fall in consumer durables is the fierce competition among banks and leasing companies in making possible these items at low credit.
Furniture, a main item of dowry, became costlier in the last four years. Chipboard price surged to Rs625 from Rs360 per sheet in 2001, while foam mattress price hiked to Rs6,675 from Rs4,500.
Karachi Furniture Dealers Group President Atiq Mir says that the price of a bedroom set (double bed, dressing table, divider and cupboard) has surged to Rs50,000-55,000 from Rs30,000-35,000, while the average quality price has moved to Rs20,000 from Rs12,000.
Chinese bedroom sets are also available at a price ranging between Rs60,000 and 80,000, but they cannot match the quality with Pakistani bedroom set, he says. He says that there is virtually a monopoly of eight foam makers and 12 chipboard makers who have made a cartel to set the price on thei1r own every year.
Locally made shoes became dearer by over 100 per cent in the last four years, thus forcing the consumers to switch over to cheap Chinese shoes. A locally made high quality leather shoe now cost Rs1,200-1,500 as compared to Rs600-700 four years back.
Opening of parallel textile mills by the some textile tycoons has made available cheaper ladies clothes, but at a cost of low quality. However, ladies clothes of high quality produced by local mills are still not affordable. Chinese and Indonesian ladies clothes have somewhat proved a breather for price conscious ladies.
In gents clothing, the consumers have a wide choice to select the suiting as per pocket outcome. Local mills’ suiting is costlier as compared to Chinese and Indonesian suiting. Branded shirts are still higher at Rs500-700, but a substitute is available at Rs150-300.
Parents are not worried these days for their children clothes since the Chinese garments with 90 per cent share have flooded the market at affordable rates.
