Cost-of-living crisis

Published September 17, 2023

WITH the caretaker government dropping a massive ‘petrol bomb’ on the people on Friday, the biting pain of Pakistan’s cost-of-living crisis is about to get worse. Factoring in the latest increase in petrol and diesel rates, the cost of both fuels has gone up by over Rs58 and Rs55, respectively, over the last month. The knock-on effect fuel prices have on the entire economy is well-documented. Already the populace has been hammered with high electricity bills, and the fuel price shock is set to trigger higher costs of goods and services. Meanwhile, wages remain stagnant — or worse, as many businesses have wound up or suspended production, resulting in lay-offs and higher unemployment. In such a grim scenario, few people will agree with the caretaker finance minister’s observation that there are “signs of economic recovery”. For the average Pakistani, there is nothing but economic pain, with more on the way, as the finance minister also hinted at a hike in gas rates.

For many middle-class households, savings are steadily being wiped out, both as the rupee’s value plummets and people dip into whatever emergency reserves they have to meet skyrocketing costs. For the working masses, putting food on the table and providing the barest of necessities has become nearly impossible. What is the way out of this economic dystopia? Various answers, provided by some of the sharpest minds in economics, have been discussed, but does the state have the wherewithal to implement these? As always, the people have been left to fend for themselves, as a cruel, distant elite basically tells them to grin and bear it. One immediate solution can be opting for public transportation to save on fuel costs. But while this may be doable in Punjab’s large cities, which have worked on modern transportation systems, this solution is not applicable in Sindh, particularly Karachi, where just over 1,000 public and private buses run, whereas around 15,000 are needed. Perhaps private bus apps should try and re-enter the market to give commuters more options, while people should also opt for carpooling. But these are mostly band-aid solutions. What is needed is an economic recovery plan that emphasises the citizens’ welfare and financial well-being. And this can only be delivered by a democratically elected government with an ear to the ground, and answerable to the people.

Published in Dawn, September 17th, 2023

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