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April 20, 2021

Finance ministry mulls real-time price monitoring by PBS

Business

April 20, 2021

ISLAMABAD: The government is considering real-time data of essential commodities on the Pakistan Bureau of Statistics (PBS) website to preempt shortfall in their demand and supply and control prices, Minister for Finance and Revenue Shaukat Tarin said.

“The data if available on real-time basis on the PBS dash-board will help in maintaining the strategic reserves of the essential commodities across the country,” Tarin said during a meeting after taking oath of office.

A top official of government told The News the app will help in getting price details and comparison in price trends within cities/districts and provinces. This will help in fixing responsibilities after identifying reasons behind for example higher flour prices in Karachi, said the official.

“The consumer inflation will cross psychological mark of 10 percent on monthly basis so the government will have to take concrete steps to reverse this prevailing trend,” said the official.

The meeting of National Price Monitoring Committee is expected to take place within a week’s time and PBS will share its data analysis report in the upcoming meeting of NPMC.

The finance minister held the introductory meeting with Planning, Development and Special Initiatives secretary / chief statistician to evaluate the current techniques of data collection and analysis used by the PBS.

Secretary Finance was not present during the meeting. One official said the secretary had to rush to another meeting at the establishment division.

In the wake of persistent pressures on food prices, the consumer inflation is all set to enter into double digit on monthly basis at a time when Prime Minister Imran Khan brought in his fourth minister for finance.

Any tinkering with the methodology of calculating the CPI based inflation will not serve any purpose and the government will have to improve its coordination with the provinces to control rising price hike. In the aftermath of 18th constitutional amendments, the role of provinces has become immensely important to tame inflation.

Tarin assigned the PBS to adopt a practice of regularly comparing the difference in wholesale and retail prices of essential food items in different districts across the country. PBS will highlight the difference in prices in different provinces as well.

The minister appreciated the technology-based data gathering techniques followed by the PBS after doing away with the paper-based approach and directed them to follow such methods that could further assist in making the data more objective, targeted and authentic for the purpose of comparison and analysis.

“Addressing the root cause of inflation with devising a new hierarchy of administrative control will provide the most needed relief to the masses,” he said.

The meeting was briefed on evidence-based data collection techniques followed by the bureau in compiling figures particularly for consumer price inflation and sensitive price indicator.

The meeting was told about the changes PBS is about to introduce in the system to make it more comprehensive.

Inflation has become a big challenge for Pakistan’s economy that started to show recovery with financial supports to improve its external financing position.

“Recent inflation out-turns have been volatile, with the lowest reading on headline inflation in more than two years in January 2021 followed by a sharp rise in February,” the State Bank of Pakistan (SBP) said in a latest monetary policy announcement.

According to SBP estimates, the recent increase in electricity tariffs and sugar and wheat prices accounts for about 1½ percentage points of the percentage point increase in inflation between the January and February out-turns.

The recent increase in electricity prices will continue to manifest in headline numbers in coming months, keeping average inflation in FY21 close to the upper end of the previously announced range of 7-9 percent.

The SBP said the recent increase in inflation is primarily due to supply-side factors. “This summer’s wage negotiations and any new tax measures in the next year’s budget could add further supply-side shocks. In addition, optimism about a stronger US-led world recovery this year is translating into higher international commodity prices, including both food and oil, which could continue to feed into domestic inflation.”