WITH global food prices rising by more than 75 per cent in recent years, the food inflation has gone beyond 34 per cent in Pakistan. As a result, the poorest spend more than 70 per cent of their income on food.

The UN inter-agency assessment suggests the price shocks were most strongly felt in Pakistan’s urban areas. Food security has to a great extent worsened, particularly for rural households in western regions who were already under stress from continued disturbances and law and order problem.

Among the 13 districts most affected by the food prices, the spending on food items by people in some districts in NWFP, Balochistan and Sindh have ranged between 88-98 per cent of their earnings. It is a clear indication of the large populations living in absolute poverty, obviously unable to protect themselves against diseases, illiteracy, and buy essentials of daily life.

So, the debates about poverty ratio whether it is 24 per cent or not, as some quarters in the government may like to claim, becomes irrelevant until fresh assessment of the ground situation in the wake of high prices is available. But there remains no doubt that a large number of people, about 11-15 per cent, living on the margins of poverty line 2-3 years ago might have fallen into sub-human conditions.

A dollar-a-day earning is no more sufficient to feed a family of six in an situation where a kilogram of wheat flour costs Rs30 or so and onion and potato are available at Rs25-35 per kg.

Under these circumstances, Pakistan is facing deteriorating child malnutrition and increased child mortality, according to the UN findings. They forecast the food price situation was unlikely to ease in the near future because of needs for import of commodities at high international prices, increase in the cost of fuel and other inputs and resultant hike in domestic wheat prices and continued demand of essentials from neighbouring countries.

The rising fuel prices and food shortages or reduced supplies, high fertiliser prices and crop diversion towards bio-fuels and attempts by some nations to increase strategic stocks of essential commodities – a return to the food policies of the 1970 - are likely to add to the problems as rice and wheat are increasingly linked to the international trade.

The international lending agencies are worried about the policy interventions introduced by successive governments (PML-Q, caretaker and the new incumbents) to tackle food shortages and prices and falling living standards of the majority of the population. They have expressed their dissatisfaction with major economic decisions, defective safety nets, and untargeted subsidies that have seen the price escalations in the last 15 months or so.

The World Bank is currently talking directly to the civil society organisations for food needs and other social security aspects at the grass roots. Although no programme for Pakistan is scheduled to be put before the board of directors in the near future, the bank is likely to put together a $250-300 million fund to disburse through the third phase of Poverty Alleviation Fund perhaps early next year.

According to Yusupha Crookes, the WB chief in Pakistan, distortions from policy standpoint were among the major reasons to create incentives for cross border smuggling of wheat and other essential commodities and hoarding causing shortages at home and the spiralling of prices. In many cases, the subsidies and policy interventions are untargeted. There are people who benefit from multiple income support programmes, like Zakat, Baitul Maal and other such schemes and still there are many who do not benefit at all. Here the real problem is of identification of the poor who are really poor and not those who have links in the influential groups.

For example, the proposed Benazir Income Support Programme that would extend Rs1,000 cash support to 4.6 million families per month would be based on the data provided by the National Database and Registration Authority (Nadra). There are, however, reports that more than 30 per cent people do not have national identity cards and there are thousands of people living in shanty towns and have not been registered at all. There is no explanation how its overlapping with Punjab Food Stamp Programme would be avoided. The Punjab programme aims at providing food assistance to 1.7 million households.

Moreover, there has been an impression of the government encouragement to cartels. Banks enjoying more than seven per cent spread, oil companies enjoying windfalls on rising international prices, oil refineries getting undue protection, some brokers making fortunes at the cost of small investors and unchecked business activities of CNG owners, cement manufacturers and sugar millers are just a few examples of the market failure and the deregulated economy, which add to the price spirals.

Mr Kamal Hayat, the chief executive of PPAF, believes that most of the government initiatives reach much later than the crisis because the operations system is not strong. Bad governance is another problem that leads to the crisis situation. He says that there are people out there dying who need immediate help. He adds the problems of higher prices and hunger are at a critical stage and could become a national security problem.

That not only requires good governance, eradication of policy distortions and targeted social safety nets, but also the political stability, institutional strengthening and addressing the causes of years of neglect.