Curbing Ramazan price hikes: lessons from global practices

LAHORE: The surge in the prices of essential commodities, particularly food items, during Ramazan in Pakistan is driven by a combination of increased demand, hoarding and market manipulation. While this phenomenon occurs in many Muslim-majority countries, its intensity and underlying causes vary.

Pakistan is worse off in this regard compared to other Muslim countries. In nations such as Saudi Arabia, the UAE, Qatar, and other Gulf states, prices remain relatively stable due to government-imposed price controls and strict market monitoring. Some essential items even see discounts due to Ramazan promotions in supermarkets.

In Turkey and Malaysia, prices may rise slightly due to higher demand, but governments actively intervene through subsidies and regulatory oversight. In Bangladesh and Indonesia, prices also tend to increase, as in Pakistan, but price caps and government-stocked food programmes help mitigate extreme spikes. In Egypt and North Africa, hoarding and speculation can cause temporary price surges, yet price control mechanisms are in place to counteract them.

Governments in non-Muslim countries rarely need to intervene to regulate prices during religious festivals. The prices of certain festive items -- such as sweets, dry fruits, oil and sugar --s may rise due to increased demand. However, in India, the government often releases stockpiles of essential commodities to stabilise prices. A competitive retail market also helps prevent artificial inflation.

In the US, during Christmas, Thanksgiving and Black Friday, the prices of turkey, ham and other festive foods may see a slight increase but are often balanced by seasonal discounts and bulk sales. Intense competition among supermarket chains and bulk retailers keeps prices in check. Unlike in Pakistan, where prices typically surge, many non-essential items in the US experience substantial discounts during festive seasons.

To prevent price hikes during Ramazan and other religious occasions, Pakistan must adopt a combination of government intervention, market reforms and consumer awareness. Authorities must crack down on hoarding and price manipulation, which often go unchecked. Large supplier cartels that deliberately create artificial shortages must be closely monitored. The dominance of small-scale retailers, rather than large, competitive supermarkets, also contributes to a lack of price stability. Unlike in the Middle East and even India, Pakistan rarely imposes effective price controls or subsidies during Ramazan.

The government should announce fixed price lists for essential items at least 15 days before the holy month. It should maintain reserves of key commodities -- such as sugar, wheat and pulses -- and release them ahead of Ramazan to stabilise prices.

Authorities should encourage large retail chains to offer discounted Ramazan packages, countering price manipulation by smaller retailers. Tax incentives could be offered to supermarkets that sell Ramazan essentials at controlled rates. Wholesalers, retailers and consumer protection bodies should be involved in setting reasonable price ceilings, with the final price lists made available on official websites, mobile apps and displayed at all retail outlets.

Strict enforcement of maximum retail prices for essential commodities -- such as wheat, sugar, flour, pulses and cooking oil -- is necessary. Penalties should be imposed on violators, and hoarded stocks should be confiscated and immediately released into the market.

Public awareness campaigns should discourage panic buying and inform consumers about where to find affordable essentials. The government could also collaborate with major brands and manufacturers to offer Ramazan discount packages, similar to those in the Middle East.

Pakistan must learn from other countries. In Saudi Arabia and the UAE, government-enforced price controls prevent price spikes, while large supermarket chains offer Ramazan discounts, reducing dependence on small retailers. In Turkey and Bangladesh, governments release stockpiled essentials to stabilise markets. In India, publicly available food reserves help prevent manipulation by traders.

Effective price control requires political will, stronger governance, and consumer activism. Had it been planned three months in advance, the substantial Rs30 billion subsidy announced by the Punjab government could have been allocated for stockpiling essential food items -- such as wheat, sugar, dates, onions, potatoes and gram pulses -- and released strategically during Ramazan to prevent price surges.