FeaturedNationalVOLUME 15 ISSUE # 23

Rising cost of living

Skyrocketing prices of essentials have maligned the image of the government among the public beyond repair. An overnight and massive hike in the prices of petroleum products recently annoyed even its staunch supporters. The Pakistan Tehreek-i-Insaf (PTI) had promised to reduce prices after coming to power. Instead, prices of gas, electricity, foodstuffs and essentials have doubled, if not tripled in its first two years.

The government has failed to stabilize prices, which fluctuate in hours and days instead of months and years. It has eroded the credibility of the government in the public. Their belief in the government’s ability to perform has shattered badly and they are convinced now they will continue to face crisis after crisis in the government of Prime Minister Imran Khan.

In the absence of an effective price checking mechanism at provincial and city government levels, prices of daily-use items increase on a daily basis. Prices of all vegetables have increased ahead of Eidul Azha. The Consumer Price Index (CPI) inflation rate increased to 8.6pc year-on-year in June, which was 8.22pc year-on-year in May. According to the Pakistan Bureau of Statistics, the urban CPI accelerated to 7.6pc YoY in June as compared to 7.3pc in May, while the rural CPI climbed to 10pc YoY when compared with 9.7pc in May. It took the FY20 national CPI average to 10.8pc as against 6.8pc in FY19. The rise in the June CPI was primarily triggered by a jump in food inflation. Higher food inflation was led by a spike in prices of wheat/flour, potatoes, pulses, condiments and spices. It was somewhat countered by a decline in tomato and onion prices. It led to a sharp increase in both urban and rural food inflation to 12.9pc YoY and 15.2pc YoY vs. 10.6pc and 12.9pc, respectively, in May.

Despite tall claims, the government failed to stabilize wheat and flour prices in the Punjab. The Punjab government had to release wheat forthwith in the market because of its shortage and rising prices. Prime Minister Imran Khan also took notice of a hike in flour prices in the Punjab and directed the provincial government to take steps to restore its rates. The prices had risen after the Punjab Food Department bowed down to the demands of the owners of four mills and increased the price of a 20-kilogram flour bag by Rs55.

The provincial government has failed to check prices despite promulgating the Punjab Prevention of Hoarding Ordinance 2020. The ordinance declares hoarding of any article an offence punishable with simple imprisonment up to three years and a fine equivalent to 50pc of the value of the articles involved in the case. For the persons informing the government about hoarding, the ordinance offers rewards equivalent to 10pc of the amount released to the government exchequer. The reward is offered after the information about hoarding results in a conviction and release of funds to the government exchequer. However, the ordinance has failed to check hoarding and prices of essentials because of weak enforcement.

The government has taken some steps to stabilize prices but none has worked. In March, it announced freezing gas and electricity tariffs but failed to obtain desired results. Annual consumer inflation came down slightly after rising to the highest level in nine years in January this year. Admitting high rates of inflation, Prime Minister Imran Khan announced his government would not increase gas and electricity tariffs anymore. He took the decision after hiking power prices four times in the first 11 months of his government. Gas and power tariffs have at least doubled for the common people in his rule. He has himself admitted his government’s disappointing performance on price control, especially after sugar and wheat flour crises hit the country in recent days. He accepted responsibility for hikes in sugar and flour prices in the country and blamed mafias for obstructing and creating trouble for his government.

His open admission of faults instead of defending them is appreciable but his government always reacts slowly to a crisis. It is not only sugar and wheat flour prices that have broken the back of the public. Pulses, oil, edible ghee, vegetables and other food items have gone beyond the reach of the common man. The government has also forgotten its promise of bringing down the prices of life-saving drugs. The Drug Regulatory Authority of Pakistan increased the prices of medicines last year, with the approval of the government, by 15pc. The life-threatening measure cost a minister his job as the prime minister was perturbed over the price hike. However, the ministry was just taken over by another minister but medicine prices could not be brought down.

The government has increased power tariff to overburden people instead of reforming the power distribution system. Huge theft, line losses and corruption in the system mean increased tariff for people. The government has also announced launching a system that would promptly alert it in case of shortage of an essential item, which will enable it to take appropriate measures timely. However, the measures appear to be part of its rhetoric.

The government has been in office for about two years now and it is enough time to take stock of the situation and fix problems. However, it continues to slam past rulers for their corruption and inefficiency and brag about “revolutionary” steps to resolve public issues. The statements, devoid of action, are mere hollow slogans, which do not impress the public anymore. People need prompt action and results. They desperately need price cuts, jobs and business opportunities. The government cannot blame the past governments for the recent hike in prices of essentials. It may have taken some measures to reform the economy, but their positive results have not reached the common people.