Money Matters

Reining in food inflation

Money Matters
By Zeeshan Haider
Mon, 01, 21

Prime Minister Imran Khan keeps the nation updated on the achievements of his economic team through his twitter.

Prime Minister Imran Khan keeps the nation updated on the achievements of his economic team through his twitter.

By regularly tweeting monthly figures of current account deficit, exports as well as foreign remittances he tries to assure the countrymen that the economy of the country is on the mend despite a massive slowdown in the world economy due to Covid-19 pandemic.

One must appreciate these achievements, however little they are, but for a layman on the street availability of essential commodities of life on affordable price is the only barometer to gauge performance of the government.

Inflation, particularly in the prices of the food items, has been a major issue for the past two years or so.

There has been an exorbitant rise in the prices of sugar and flour, and despite tall claims, the government has been unsuccessful in controlling prices of these commodities.

There was a slight relief in prices of these items in the last month, for which the prime minister congratulated him team. However, now there is again an upward trend in these prices.

“MashAllah sugar is selling at a national average of Rs81 per kg vs Rs102 per kg a month back. I want to congratulate my team for bringing the sugar prices down through a multi-pronged strategy,” Prime Minister Khan had said in a tweet a month ago.

Now, sugar is again being sold at an average price of around Rs100 per kg and there has been no word from the government on this issue so far.

Seasonal variations in prices occur every now and then when it comes to food commodities, but this government has not been able to curb price hike caused by hoarding.

Instead of launching a crackdown on hoarders and other mafias, successive governments have taken the easy way of easing pressure on it by importing these commodities.

Resorting to such measures frequently is not a desirable thing to do in an agrarian country. Instead, the government should take effective measures to discourage undue profit-taking by powerful mafias.

The Joint Investigation Team (JIT) report on sugar scandal has been out for months. It showed the names of the ruling party’s leaders and allies on top, but so far the government has not taken any effective action against them.

Farmers have also complained about the government’s import policy to combat artificial shortage of good items without any proper planning.

For example, they say because of a huge rise in tomato prices, the government allowed its import from Iran and other countries. However, they say the government should have planned this import so that it did not hurt the local farmers and industry.

They say the permission of import even when the new local crop has arrived in the market would obstruct its disposal, which would inflict huge financial losses on the local farmers.

The government seems to be clueless about how to control the price hike in food items.

According to official data, higher food prices, particularly essential food items, were the main causes of overall inflation

Syed Fakhar Imam, a big farmer, has been working as Food Security Minister in the federal government, but he has been missing in action since a flour crisis hit the country a few months ago.

On the floor of the National Assembly, he even confessed his ignorance about how the crisis actually happened.

The government ministers habitually blame the ‘wrong policies’ of their predecessors for inflation and say that price control is a provincial subject.

However, after having been in power for around two years and a half, blaming previous governments for today’s inflation is too much.

Moreover, the Pakistan Tehreek-e-Insaf (PTI) controls two provinces, particularly the country’s food basket, Punjab, and also is a coalition partner in the third. So it should hold its provincial governments accountable for their failure to contain food inflation.

Though the opposition hype to topple the government has largely subsided and the PTI ministers now seem more confident about dealing with their opponents, the threat to the government’s stability has not yet fully receded.

The opposition is no longer holding anti-government rallies in big urban centers and has focused its attention on towns and small cities close to rural areas where sentiments over high food inflation are soaring.

In this situation, the government should take urgent and effective steps to deal with the problem of rising food inflation. On one hand the government should also ensure that farmers get the right price for the crop they have grown, and on the other hand it should take strong measures to ensure availability of essential food items to the general population on affordable prices.

New political and governance challenges are appearing for the government every day.

The controversy over the revelations pf London-based Broadsheet firm, the impounding of a PIA plane by the Malaysian authorities on their court order and opposition’s planned protest before the Election Commission headquarters in Islamabad are currently a few political challenges faced by the government.

But the growing anger among people over price-hike is the most serious challenge for any political government. It is the need of the hour that the government draws up a workable strategy to deal with it.

Earlier, there was an attempt to activate the prime minister’s Tiger Force to tackle the price hike, but it failed to produce desired results.

Instead of involving its party cadre into administrative matters, the government needs to mobilise relevant bureaucracy to tackle the situation. Activation of traditional price-control committees in liaison with local administration is the only way to address this problem in an effective manner.

The government also needs to open dialogue with the representatives of the farmer community to address their genuine problems, as it did by engaging exporters in talks.

Farmers are the backbone of Pakistan’s economy, and turning around the economy of an agrarian country like Pakistan is impossible without engaging farmers.

The government, therefore, without any further delay should invite the farmer community for talks to address their grievances.

Moreover, the government should also undertake long overdue steps to rein in vested interests and powerful mafias wreaking havoc with the country’s key agriculture sector for a long time.

The writer is a senior journalist based in Islamabad