PRICES of essential consumers’ items of daily consumption have not stabilized despite the supply augmenting measures through imports and apparent resolve of the government to curb cartelization, and hoarding practices with strong legal actions. The report released by Pakistan Bureau of Statics (PBS) states that, measured on the yardstick of Consumer Price Index (CPI), inflation has registered 9 percent increase on year-on-year Y0Y) basis in September 2020 as compared with the indicator of the same month last year. The trend of month-on-month (MoM) upward movement of prices of represented commodities for the calculation of price indices indicate rise of 1.5 percent in the rate of inflation. The PBS data reflect that urban inflation rate increased by 7.7 percent on MoM basis in September as compared with the rise of 7.1 percent in the preceding month this year and 11.6 percent in the month of September last year. On the average, rate of inflation went up by 1.3 percent on MoM basis. Measured on the yardstick of sensitive price index (SPI), the price spiral is more alarming as inflation rate has gone up by 12.1 percent on YoY basis in September 2020 as compared with the increase of 11.7 percent in month of August of the current year. The inflation rate had gone up by 14.7 percent in the month of September in 2019. The SPI shows an increase of 2.1 percent on MoM basis.
The PBS data show that prices of food commodities and energy items went up by galloping speed as against the steady upward movement of prices of non-energy items as the inflation of the latter category of goods rose by 5.5 percent. The PBS data does not include the recent unprecedented rise in the price of medicines, because these items do not fall in the category of weighted commodities under the umbrella of inflation measuring indices, although the medicines that are regularly used for the blood pressure, diabetes should have been treated weighted items. The major drivers responsible for this grim scenario include shrunk productive capacity of the economy, failure of the government to break cartels, allowing stakeholders of these cartels to first export wheat and sugar by availing export subsidy and then import these commodities by doing away with import duty and advance income tax. Moreover, disruptions in supply chain and jacking up petroleum products prices have accelerate the pace of inflation.
