Pakistan becomes most expensive country in S Asia

A shocking disclosure was made in the Economic Coordination Committee of the Cabinet (ECC) last week that Pakistan had become the most expensive country in the South Asian region after the highest rise in the prices of essential food items and the “highest inflationary pressure” compared to its neighbours like India, Bangladesh, Sri Lanka and others.

The fresh evaluation of prices of food items done by the government revealed that India, Bangladesh, Sri Lanka and other neighbouring countries were less expensive than Pakistan. But the official papers placed before the ECC were mysteriously silent on an important aspect of inflation, as Afghanistan is also much cheaper than Pakistan.

Apart from others, two most essential food items — fresh milk and sugar — have registered a huge rise in their prices and have gone much higher than the neighbouring countries. The price indicators revealed that overall Pakistan was facing the worst pressure of inflation as compared to its neighbours.

The sources said that in the ECC meeting presided over by Finance Minister Dr Hafeez Sheikh, some of the ministers expressed their shock over the sudden rise in the prices of sugar and other essential items. The sources said that the quality of data on the basis of which sugar consumption and import policies were being framed also came under fire in the meeting when some ministers lashed out at the authorities responsible for the sudden rise in the prices of sugar.

However, as usual, Commerce Minister Makhdoom Amin Fahim, who was being held responsible for the sugar crisis in the country for failing to import the commodity on time, was once again missing from the meeting. He had earlier skipped his cabinet meeting on Wednesday, which too had discussed the sugar crisis. The sources said that Makhdoom Amin Fahim was presently on a foreign trip when the country was heading towards a major sugar crisis — thanks to his ministry’s poor decision at the time of award of sugar import contracts to some bogus firms, which failed to meet their import contracts, leading to a serious price hike within a month.

Earlier, it was also disclosed that in the last financial year 2009-2010 just ended, the direct foreign investment had registered a drastic fall by 39 percent as against the corresponding year of $3.3 billion, the figure had come down to $2.2 billion.

The sources said during the briefing on the economic indicators to the ECC members, the ministers were warned that for the last few months, inflation was on the rise.

The official documents revealed that the prices of fresh milk went up by 17.1 percent and sugar alone registered a rise of 12 percent in the month of May 2010 when compared with May 2009 and these two items consumed the purchasing power of common man. The prices of wheat flour, tea and vegetable ghee also went up during the last one month.

The major price gauge i.e. Consumer Price Index (CPI), Sensitive Price Index (SPI), and the Wholesale Price Index (WPI) for the month of May 2010 showed estimated rise of 13 percent, 17.3 percent and 21.2 percent respectively.