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Food inflation in Pakistan

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Muhammad Arif : Chairman Centre of Advisory Services for Islamic Banking and Finance (CAIF), Former Head of FSCD SBP, Former Head of Research ArifHabib Investments and Member IFSB Task Force for development of Islamic Money Market, Former Member of Access to Justice Fund Supreme Court of Pakistan

Pakistan is the grip of growing inflation but the team from Assad Umar to ShaukatTareen has failed to grip it or to bring it down. Our currency is worth less and less and the price of our daily necessities continues to increase at alarming rates. Here are just a few of the ways that Crisis Times says inflation, whether it is monetary or price inflation, affects us negatively:

  1. Fixed income recipients feel the pinch because as prices go up, income doesn’t also go up.
  2. Since people tend to spend more cash during times of high inflation, national savings decreases.
  3. Many companies go out of business because of the losses incurred because of inflation.

Unfortunately, the evidence to support the certainty of inflation is all around us. It should come as no surprise to anyone that petrol prices are on the rise and seem to show no sign of relenting. The cost of oil is just going to climb higher and higher.

As far as grocery prices are concerned, we should brace for higher food prices this year now that demand for corn has pushed Pakistani supplies to their lowest point in 15 years In terms of clothing shopping, “cotton is now 80% more expensive than it was at the start of 2010, and manufacturers are passing those added costs on to customers”

If these facts seem a bit scary, take a look at this startling information:

Here one should not mean to be a Debbie Downer, but this post is about overcoming and saving money even in the face of inflation, so we have to know what we’re up against. Now that we know what it is we’re fighting, we can arm ourselves for the future. Here are just some of the ways that you can put on your game face and fight against inflation:

  1. Invest in Goods or Commodities, Not Money:
  2. Get a Strong Support Group.
  3. Grow Your Own Food.
  4. Save Electricity and Energy:
  5. Buy in Bulk.
  6. Ask for a Raise.
  7. Earn Extra Cash on the Side.
  8. Saving Money on Gas:

Situation in Pakistan, price inflation is caused by: – declining economic growth – lack of expansionary policies – output setbacks – higher taxes – a depreciation of the value of rupee• more than 11 percent inflation rate per annum recorded .

Indicator Data Period
Consumer Price Index (CPI) 145 index points Jun/21
Food Inflation 10.48 % Jun/21
Inflation Rate YoY 9.7 % Jun/21
Inflation Rate Mom -0.24 % Jun/21
Core Inflation Rate 6.7 % Jun/21
CPI Housing Utilities 140 Index Points Jun/21
CPI Transportation 144 Index Points Jun/21

 Pakistan inflation rate for 2019 was 10.58%, a 5.5% increase from 2018. Pakistan inflation rate for 2018 was 5.08%, a 0.99% increase from 2017. n Pakistan, most important categories in the consumer price index are food and non-alcoholic beverages (35 percent of total weight); housing, water, electricity, gas and fuels (29 percent); clothing and footwear (8 percent) and transport (7 percent) Consumer Price Index in Pakistan remained unchanged at 145 index points in June 2021. The maximum level was 145 index points and minimum was 31.12 index points. Housing Utilities in Pakistan increased to 140 Index Points in June 2021. The maximum level was 143 Index Points and minimum was 117 Index Points

Pakistan’s GDP growth rate will shrink to 2.6% from 3.3%, while inflation will remain around 11.5% for 2020-21, the Asian Development Bank (ADB) projects in its latest report released on Friday.The Asian Development Outlook (ADO) report noted that Pakistan, compared to other South Asia countries, will “struggle this year with double-digit inflation”, which is expected to clock in around 11.5%

When most people think of inflation, their response is usually similar to when they see a vintage advertisement: reminiscing about the cheaper prices of the past (15 cents for a burger? Awesome!) While simultaneously feeling some resentment towards today‘s ever-rising prices. Generally, inflation is seen as a frustrating “financial fact of life” that passively affects everyone as price levels climb and as the PKR purchasing power decreases over time.

The reality is that inflation is affecting your finances more aggressively than you might realize—especially when it comes to your savings. Without the proper planning in place, the effects of inflation could actually be costing you your savings.

In Pakistan the main reason of inflation is the increase in the prices of regular items, such as wheat, sugar, ghee and other items. The government has totally failed to control the prices of these items. Petrol price hikes is the second main cause. When oil prices are increased it affects prices of its complementary goods too.

Pakistan imported goods worth $6.59 billion in August with major contributions were associated with petroleum products, machinery, food commodities and agriculture products. Pakistan spends $7.5bn on food imports in July-May (2020-21).

This is what is happening and conclusively we have to boost exports, reduce imports, make maximum to get the jobs invest in education and health with human resource development. Become active partner of new block of central Asian states to bring investment in Pakistan.

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