After 2021, the inflation rate in Pakistan had reached the highest level in the country’s history. The value of the Pakistani rupee had fallen against the dollar in the international market. The prices of gas and electricity increased by more than 100 percent per unit. The prices of food items, medicines, cement, sugar and other construction materials will also increase by more than 100 percent. The prices of all these items have severely affected the middle and lower class segments. However, according to government claims and the latest updates and reports of domestic and international financial institutions in the last fiscal year 2024, inflation has been controlled and prices have stabilized. The burden of external debt on the country has reduced and the overall economic condition of the country has improved, which has made a clear difference in the lives of the common man.
According to the latest updates of national financial and international institutions, the country’s economic condition has improved. Inflation rate in Pakistan for the last two and a half years
Inflation rate in Pakistan had increased to an alarming extent for the last two and a half years and some economists had even said that it would soon become economically bankrupt. But after the elections, when Mian Shahbaz Sharif became the Prime Minister of Pakistan again, after about 6 months, reports emerged that the burden of external debt would be reduced and the value of the rupee against the dollar would stabilize in the international market. However, this report cannot be taken to mean that the inflation rate has decreased. Even now, consumer price inflation, i.e. the prices of everyday items used by ordinary consumers, are still increasing in Pakistan. Inflation figures in Pakistan are always reported on an annual basis. Overall, inflation in Pakistan has increased by 100 percent during the last four years. And there is no need to be too happy about the recent figures, the Pakistani rupee is weak and the people are fed up. These are some of the comments that various social media users who are familiar with economics seem to be making after the federal government of Pakistan claimed that the inflation rate has come down.According to the Pakistan Bureau of Statistics report, the Pakistan Bureau of Statistics released a report on inflation in the country on September 2 and said that the inflation rate, which was 84.27 percent in August 2023, was recorded at 6.9 percent in August of the previous year. This is the lowest inflation rate in October 2021. In October 2021, this rate was recorded at 2.9 percent. Has the government claimed a reduction in inflation? The report released by the Pakistan Bureau of Statistics on inflation states that inflation in Pakistan has reached single digits after almost 3 years and the inflation rate in August this year was recorded at 64.9 percent. Pakistani Prime Minister Shahbaz Sharif also expressed satisfaction over the reduction in the inflation rate and the improvement in other economic indicators and said that after this, the global rating agency Moody’s recently upgraded Pakistan’s credit rating, which is an acknowledgement of the country’s positive economic indicators by international financial institutions. According to the IMF report, the International Monetary Fund (IMF) has released the World Economic Outlook Report 2024. According to the report, inflation and unemployment are likely to decrease in Pakistan during the current fiscal year. The report says that the economic growth rate in Pakistan is likely to be 2.3 percent this year and next, which was recorded at 2 percent in the last fiscal year. According to the IMF report, the unemployment rate is likely to decrease to 5.7 percent, which was recorded at 8 percent last year. The report says that the fiscal deficit is likely to be 9.0 percent, which was 2.0 percent during the last fiscal year. According to Prime Minister of Pakistan Shahbaz Sharif, Prime Minister Shahbaz Sharif, while addressing the federal cabinet meeting in the federal capital Islamabad a few days ago, said that the burden of inflation is gradually decreasing. The inflation rate has reached single digits in August. Last year, this rate was 27 percent during the same period. According to the data released by the Bureau of Statistics in the monthly inflation report, the inflation rate has reached a 34-month low, the main impact of which is on the prices of non-perishable food and beverages, however, there has been an unprecedented twofold increase in the prices of other essential goods. In August 2024, the annual Consumer Price Index was 1.11 percent in the previous month, thus the monthly inflation rate was 69.0 percent, while in August 2023, the inflation rate was 4.27 percent. Thus, in the first two months of the fiscal year 2025, during July and August The average inflation rate was 36.10 percent, compared to 84.27 percent in the same period of the previous fiscal year. The Bureau of Statistics said that inflation in urban areas increased by 27.0 percent and in rural areas by 55.0 percent in August, after which the inflation rate in cities in August was recorded at 71.11 percent and in villages at 73.6 percent.
Ministry of Finance’s Monthly Economic Update
It should be noted that the Ministry of Finance had said in its monthly economic update and outlook report that inflation is likely to remain between 5.9 and 5.10 percent in August, while it is expected to decrease further to between 9 and 10 percent in September. The global rating agency Moody’s increased Pakistan’s credit rating from Outlook to Stable and changed Pakistan’s credit rating from CAA 3 to CAA 2. The people worried about inflation in Pakistan say that now we can only eat one meal at a time. The reduction in interest rates has reduced inflation in Pakistan or has it stopped its further increase? An additional unit of electricity that causes a doubling of the bill. Increase in electricity prices will affect the price of bread even when the fan and light are turned on on the tandoor. What was the price of essential commodities last year compared to August this year? The Pakistan Bureau of Statistics report shows that one of the reasons for the decline in the inflation rate in August this year is the high inflation rate in August last year, as well as the decline in the prices of wheat, flour and cooking oil. While the heavy taxes imposed by the government in the budget this year have doubled the prices of clothes, shoes, perishable goods, food and beverages, house rent, electricity, gas, water, fuel, health services and educational expenses. Compared to last year, in August this year, gas prices have increased by 319 percent, vehicle taxes by 169 percent, and transport services by 23 percent. While onion prices have increased by 136 percent. While fresh vegetables have increased by 77 percent, pulses by 43 percent, fresh fruits by 27 percent, milk powder by 24 percent, meat by 20 percent and milk by 10 percent. It should be noted that this year the government has increased the price of these items in the budget and An 18% sales tax was imposed. On the contrary, in August this year, compared to last year, there was a 37% decrease in the price of wheat, 34% in the price of flour, 12% in cooking oil, 3% in the price of tea, and about 4% in the price of sugar. So, has inflation really decreased in Pakistan? On the basis of which, has the common Pakistani received any relief?
Ministry of Finance’s Monthly Economic Update
It should be noted that the Ministry of Finance had said in its monthly economic update and outlook report that inflation is likely to remain between 5.9 and 5.10 percent in August, while it is expected to decrease further to between 9 and 10 percent in September. The global rating agency Moody’s increased Pakistan’s credit rating from Outlook to Stable and changed Pakistan’s credit rating from CAA 3 to CAA 2. The people worried about inflation in Pakistan say that now we can only eat one meal at a time. The reduction in interest rates has reduced inflation in Pakistan or has it stopped its further increase? An additional unit of electricity that causes a doubling of the bill. Increase in electricity prices will affect the price of bread even when the fan and light are turned on on the tandoor. What was the price of essential commodities last year compared to August this year? The Pakistan Bureau of Statistics report shows that one of the reasons for the decline in the inflation rate in August this year is the high inflation rate in August last year, as well as the decline in the prices of wheat, flour and cooking oil. While the heavy taxes imposed by the government in the budget this year have doubled the prices of clothes, shoes, perishable goods, food and beverages, house rent, electricity, gas, water, fuel, health services and educational expenses. Compared to last year, in August this year, gas prices have increased by 319 percent, vehicle taxes by 169 percent, and transport services by 23 percent. While onion prices have increased by 136 percent. While fresh vegetables have increased by 77 percent, pulses by 43 percent, fresh fruits by 27 percent, milk powder by 24 percent, meat by 20 percent and milk by 10 percent. It should be noted that this year the government has increased the price of these items in the budget and An 18% sales tax was imposed. On the contrary, in August this year, compared to last year, there was a 37% decrease in the price of wheat, 34% in the price of flour, 12% in cooking oil, 3% in the price of tea, and about 4% in the price of sugar. So, has inflation really decreased in Pakistan? On the basis of which the common Pakistani has got any relief?
Government claims and ground realities regarding reduction in inflation
In this regard, we have kept in mind the government data and according to economists, inflation has not decreased this year compared to last year, but rather its growth rate has decreased. However, despite this, the situation is still very disturbing for the common man. According to the latest report of the Pakistan Institute of Development Economics, about forty percent of Pakistan’s population is currently below the poverty line, that is, one-third of the population is living in poverty. 70 percent of people do not have their own homes to live in and are living in rented houses. Unemployment is increasing day by day. Due to the industrial crisis, many factories have closed, which has made millions of people unemployed. Due to the increase in fees, the doors of higher education have been closed to people belonging to the middle class and backward classes. Youths, tired of unemployment, are leaving the country through legal and illegal means. The majority of the youth are visiting the countries of the Middle East. Many young people are illegally reaching the eastern countries, they usually fall into the hands of human traffickers and either face many difficulties or die in the middle of the sea.
Opinion of the Pakistani people on inflation
According to a public survey report conducted in many small and big cities and towns of Pakistan on inflation, the people said that they did not notice any decrease in the inflation rate, the inflation rate is exactly the same as it was today. Due to the increase in the prices of petroleum products, the prices of essential commodities were increased, electricity, gas and petrol and diesel had become expensive, in front of which the purchasing price of the public had responded, the price of gold in the country increased due to the increase in the dollar rate, food and drink became expensive, transport fares increased, and due to the increase in the cost of cement and cement, building houses became out of the reach of the poor and middle class. Now that the government is claiming that the inflation rate is decreasing, we have not felt any such thing nor have we received any relief. Public circles are also saying that until we get relief and essential commodities and other things are available at affordable prices, we cannot agree with the government’s claims of reducing inflation.
