Shah Alam market also known as Shah Aalmi is the largest whole sale market of consumer and packed food products not only in Lahore but also in Punjab. The shop keepers from across Punjab and KPK provinces come to this market to buy different products. Shah Alam market represents the business sentiments of importers, wholesalers and retailers. The market is reacting negatively to the weaker rupee and rising dollar.
Ace News made a visit to this market to conduct the survey of the sentiments of the importers and traders after the sudden rise in the dollar. The dollar touched Rs144 against Pakistan Rupee but came down to Rs138 after intervention by the State Bank of Pakistan (SBP). Many market experts are linking the sudden rise of Rs10 in the value of the US dollar is based on the government’s commitments to the International Monitory Fund (IMF).
The importers are not happy with the continued devaluation of Rupee against dollar because it is making imports more expensive. Syed Nabeel Ahmed an importer of electrical products and lights from China in Shah Alam market told the Ace News the following, “The prices of imported goods are going up and making it difficult for the poor consumers to buy products.
We were used to manufacture many products in Lahore. The rising cost of production forced us to close our factory in Pakistan and started imports from China as the products were cheaper. But rising dollar has made the products expensive. Now we are finding ourselves in a situation in which both raw materials and manufactured products have become expensive. Our sales went down in last few months. We are again looking for alternatives to import cheaper goods”.
Shaukat Ali an importer of toys told Ace News that due to the rising dollar, the prices of imported toys have gone up between 30 to 50 percent in last six months. The rising prices made the toys expensive and this resulting in decrease in sales. The situation in market is very volatile. The expensive imported toys have gone out of the reach of ordinary people”.
Malik Ikhlaq, importer of food items told us that the prices of packed food items, formula milk for children and milk powderhas increased significantly in recent months. He said rising prices have affected the sale of these products. The sales have slowed down.
Some importers and wholesalers complained that when they book their import orders and calculate the prices of products and start taking orders from wholesalers and retailers on the calculated prices, the sudden rise in dollar make the import expensive when it reach to their warehouses in Pakistan.
One importer told us that when inflation goes up and different products becomes expensive than the people just the most important products like food and household products. He acknowledged that rising expenses and stagnant incomes making the purchasing choices much harder and limited. Under these circumstances, the people just buy things that are inevitable for daily life. Many products become luxury and people delay or postpone purchases.
Many shopkeepers who came from different cities of Punjab and KPK expressed displeasure at the sudden rise in the prices of many imported products. One shopkeeper from Hafiz Abad told us that wholesalers and distributors have increased the prices without any justification because these imports were made before the recent devaluation of rupee against dollar. But wholesalers have already increased the prices.
When we asked some wholesalers about the sudden increase in the prices, they replied that importers have increased the prices and they are getting expensive goods. The situation is that everybody is accusing the others for this sudden increase in the prices.
The impact of rising dollar and weakening rupee can clearly be seen in the markets. There is chaos and uncertainty in the market. But some importers and wholesalers are also taking undue advantage of the situation and earning unfair profits. They have artificially increased the prices of already imported products which were imported before the recent devaluation of the currency. The government should take proper action to stop the undue price hike just to make maximum profits.
Some big players in the market also busy in hoarding the different imported products to sell on increased prices. This hoarding should be discouraged. Ultimately, it is the general public and common citizens who pay the price for this profit taking and unethical business practices.
Khalid Bhatti and Amir Sohail Ace News Lahore
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17 November, 2019