Pakistan has reported an increase in inflation based on the Sensitive Price Indicator (SPI) of 47.23% on a year-on-year basis by the week ending April 19, 2023. The high inflation rate has made it challenging for many Pakistanis to purchase essential items during Eid celebrations.
The Pakistan Bureau of Statistics data shows that the prices of wheat flour increased by 144%, high-speed diesel by 103%, tea by 104%, potatoes by 99%, bananas by 98%, eggs by 99%, and gas by 108%, according to a report published by pkrevenue.
Many people in the crisis-hit country are cutting back on non-essential purchases and looking for different ways to save money on necessary items. Economists believe that several factors including the supply side’s highest-ever transportation cost have led to the current high prices
The federal government has been taking tough measures like hike in fuel prices, power tariffs, withdrawal of subsidies, market-based exchange rate, and higher taxation to unlock the International Monetary Fund (IMF) bailout package.
Saudi Arabia and the United Arab Emirates provided financing assurances helping the nation inch closer to the IMF funding and avert a default.
However, the lender is still seeking further assurances to ensure Pakistan has fulfilled the condition of arranging the $6 billion financing to reach a staff-level agreement.
Nathan Porter, the IMF’s Mission Chief to Pakistan said that there was an agreement on the need to maintain strong financial policies and secure sufficient financing during the meeting between the Pakistani delegation and IMF staff.
He added that the IMF looks forward to obtaining important financing assurances as soon as possible to unlock the bailout package.
Responding to IMF’s recent remarks, Pakistan Prime Minister Shehbaz Sharif emphasized that the country has now met all ‘tough’ conditions laid forth by the financial body and now it has ‘no excuse’ to delay the state-level agreement.
“Pakistan was not created to run on debts and act like beggars because their forefathers and different generations had given sacrifices for the motherland,” PM Shehbaz said.