The prices of food, medicines, utilities, and consumer products are continued to rise. The government has simply lost the control over prices. The people are suffering as the result of this failure. The government ministers and economic managers are still blaming the previous governments for the high inflation in the country even after completing two years in the government.
The government is not ready to accept the simple fact that the price hike is the result of government policies. The PTI government is implementing the IMF dictated neoliberal economic policies and has been increasing the prices of electricity, gas, petrol and cut the subsidies on food and agriculture products.
As the result of neoliberal economic policies imposed in last 40 years, the government has lost control over the economy. The private sector now dominates the production and trade. The public sector industries and enterprises were mostly privatised since 1990s.
The competition between public and private sector ended with wholesale privatization in last 30 years. There is hardly any industry left with public sector in sugar, cement, fertiliser, pharmaceuticals, textiles, engineering and consumer producing sector of industries. The private sector has almost complete control in these industries.
They manipulate the market and prices because they have formed cartels and create artificial crisis through reducing the supply. The government watches all that helplessly and most of the times oblige the interests and wishes of the big players of these industries.
When the prices of electricity, gas and petroleum products go up, then the cost of production rise and make products expensive. These three items are used in commercial and industrial activity. The strange thing is that first government allows the increase in prices and then blames the mafias for creating artificial crisis and price rise due to hoarding profit taking.
Now take the recent example of three decisions made by PTI government to increase the prices of nearly 100 medicines, food items at utility stores and electricity. These decisions will increase burden on already struggling people of Pakistan.
The increase in the price of electricity will have wider impact on the prices of products. It will increase the cost of business and production. The PTI government came into power with the promise to fix the economy and to reform the system. Instead of taking action against so-called mafias and cartels, the government succumbed to pressure and increases the prices of 100 medicines.
The federal government has approved a hike as high as 262% in the prices of nearly 100 local and imported medicines in Pakistan. Among these are 68 local medicines and 26 imported ones. The justification to increase the prices of medicines is very interesting.
The government is arguing that it allows the increase in the prices of medicines because government feared that the medicines might disappear from the market. So it means that the government increased prices under pressure from pharmaceutical industry.
After failing to contain the prices and making sure the availability of flour, sugar and petrol, the government decided to give rise to medicine prices to keep them available in the market. That shows that how little control our government new has over production and prices. That is the real reason of the price hike. But government is not ready to accept this fact.
Drugs that became costlier included those used to treat fever, headache, heart diseases, malaria, diabetes, sore throat, flu, abdominal and stomach pains, skin diseases, postpartum issues, and eye, ear, tooth, mouth, and blood infections, as well as certain antibiotics.
The matter of fact is that this increase has made medicines so expensive that vast majority of people cannot afford it. The government policy and decision makers must understand that nearly 60% of Pakistani population lives below or around the poverty line. They are not in the position to buy medicines and even food items.
Nepra has approved a raise of Rs1.62 per unit in power tariff on account of fuel adjustment cost for the second and third quarters of Financial Year 2019-20. This places an additional cost of Rs168 billion or a little more on consumers.
The decision to increase the prices of some food items at utility stores will increase the burden on already impoverished masses. Mostly poor and lower middle class people use the subsidised products like cooking oil, sugar and pulses from utility stores. Now there is hardly any difference left between the prices at utility stores and markets.
There are serious repercussions to these decisions. The burdens of households already stretched to the very limit, will be stretched further, some may break leaving very little for families in terms of buying food items, or sending children to school.
There has also been an increase in the cost of cooking oil by Rs 17 per litre, as well as of ghee and an extra Rs5 per litre will be added to the price of milk. This is a tremendous burden on most households throughout the country. There is no real explanation from the federal government or any other source on quite how people are to manage. They are barely managing at this point already, with an exorbitant increase also in the price of life-saving drugs. Once again, it is the people who will suffer.
The reality is that more and more families are already struggling to even send their children to school. This is an unacceptable situation. It is also obviously essential for every family to buy oil, or ghee with which to cook – or medicines to save their lives.
These are not items that can be left off the list. The solutions for these households simply do not seem to be there at all. Everything costs more now. Sugar has gone up from Rs 50 per kilogram to Rs 100; flour was Rs 35 per kilo two years ago now selling at Rs 75 now. The prices of milk have gone over Rs 100 per liter while prices of vegetables and lentils have also one up considerably.
These are just flour, lentils and rice that we are unable to afford. Having mutton at Rs1, 100 per kg, beef at Rs 680/kg and chicken at Rs 200/kg is simply unthinkable. It is just the common people who are being punished for the failures of rulers. The people are being crushed. The life is getting more and more difficult and miserable.
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