Inflation misery

Published
57

THE PDM government’s continuing inability to keep prices under control speaks volumes about the competency of its economic management team, currently led by a former finance minister who loves to make a great deal of his ‘extensive experience’.

It has thus far failed to show any spine as far as the protection of ordinary citizens’ financial well-being is concerned. As a result, the public has largely been left to fend for itself as the country undergoes a severe and painful reconfiguration, resulting from years of myopic and self-serving decisions.

It is fair that rather than point the finger at an individual or group of individuals, one should blame the succession of self-confident economic ‘wizards’ whose only real trick has been to disappear as soon as the cost of their bad policies comes due. However, the PDM had sold itself as the panacea to Pakistan’s economic challenges, especially when the government was with the PTI. It has yet to demonstrate why it had been so confident in its ability to deliver.

Consumer inflation continued to burn red-hot at 24.5pc in the cold of December, reversing track from a brief (and slight) dip to 23.8pc in November and taking average inflation for the first six months of the ongoing fiscal year (July to December) to slightly above 25pc. That number masks a more worrisome reality: inflation in rural areas, where more than two-thirds of the country’s people reside, has been considerably higher at around 28pc over the same period.

Meanwhile, the urban citizenry has been forced to spend, on average, 23pc more on their needs in fiscal 2023. The data reported by the Pakistan Bureau of Statistics also shows a worrying upward trend in commodity prices in the month of December compared to November, indicating that prices have yet to stabilise and may, therefore, continue to rise. The data shows that food is now the biggest driver of inflation, with prices up by an eye-watering 35.5pc year-over-year. Prices of perishable items are up, on average, by a shocking 56pc from the same month last year.

The average citizen has little choice but to cut consumption and curtail their dreams as out-of-control inflation decimates their household budget. With a sense of helplessness and hopelessness slowly descending on the country, those who are privileged are increasingly talking about moving abroad.

The least the government could do in these difficult times is to leverage its administrative powers to ensure that unscrupulous players are not taking advantage of the prevailing instability in domestic markets to profiteer at the expense of the browbeaten citizenry.

Demonstrating to the nation that it is doing what it can despite challenges would greatly help in keeping the country together. However, it seems the finance minister is too caught up in his own worries and has little time for those whose future he has taken responsibility for.

Published in Dawn, January 4th, 2023

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