ISLAMABAD, May 5: Aggravating price hike is pushing Pakistan towards a long-term recession, which may end up in increased poverty, food insecurity and cut in the purchasing power of financially crumbling consumers.

This was stated by economists while presenting their analyses at a seminar on “Unbridled price hike: implications and options” organised by the Sustainable Development Policy Institute (SDPI) here on Monday.

The World Food Programme (WFP) has recently described the soaring food prices as “a silent tsunami” that threatens to plunge more than 100 million people into poverty.

Only improved domestic policy-making and its implementation could make the country come out of the unprecedented price hike, the economists said.

They cautioned the new government’s economic wizards that the current crisis would further worsen in the days to come, and if the government failed to come up with an informed policy and decisions, majority of the people particularly the poor would be the greater sufferer.

The price of milk, wheat, meat and rice hiked to unmanageable levels during the last two months on the back of substantial increase in the price of petroleum, which had drastically reduced the purchasing power of the salaried class.

Mazhar Siraj of Consumer Rights Commission of Pakistan (CRCP) warned that the ongoing wave of price hike was pushing Pakistan towards a long-term recession.

He said food price such as vegetables and chicken had increased by more than 20 per cent just in one month, which had further made half of the country’s population food insecure.

He deplored that the situation had arisen partly due to surge in petroleum prices in the international market, and largely due to lack of vision and defective public policymaking.

“The previous government invested least on demand and supply management, and instead, tried to address the issue through ineffective ad hoc measures such as subsidies while our oil- driven economy is facing serious shortage of energy resulting in increased cost of production and transportation,” he added.

Mr Siraj stressed that Pakistan needed a multi-sectoral strategy to address the issue, as the Ministry of Finance could not provide a solution to the worsening problem alone.

He said a cohesive strategy should focus on revising the import parity pricing formula and taxes levied on petroleum products, and demand and supply management in energy, agriculture, and communication.

The Planning Commission of Pakistan should take lead in formulating proposals, which should then be implemented through an Inter-Ministerial Pricing Coordination Committee in addition to the culture of accountability of the political leadership, which was responsible for current energy deficit and the resultant price hikes, he added.