KARACHI: Khalid Hussain is one of the many people who for the first time in many years could not do Eid shopping for his three children until the last days of Ramazan due to rising inflation, soaring prices for edibles and power bills and increasing cost fuel over the last one year.

“I went to buy unbranded ready-made clothes and sandals for my 12-year-old and eight-year-old sons and three years old daughter a few days ago, but returned empty-handed due to the total cost reaching to Rs9,000-10,000 as compared to Rs5,000-6,000 of last year’s expenditure. I will try again in a couple of days.”

A year ago he was a bit satisfied in paying his electricity bill of Rs2,000-2,500 of a two-room portion in F.B Area, which has now escalated to Rs4,500 due to various adjustments and surcharges in the bill.

“Our monthly food consumption cost has swelled to Rs25,000-30,000 from Rs10,000-15,000 in a year followed by monthly house rent to Rs18,000 from Rs15,000,” he said.

Cost of monthly groceries, utility bills and petrol has gone beyond public’s reach

While recalling monthly private school fees of Rs3,000-3,500 for three kids last year, he said, “it has now reached to Rs6,000 per month.”

Khalid runs a small dairy shop after shifting from his trade from cycle repairing six months back. “High cost of living has forced me to take cost cutting measures in managing food expenditures. The next option is to take some loan from friends and relatives to control running expenses and then paying back them in instalments,” he said.

Due to skyrocketing prices, he said he had to compromise on quality in buying ghee and cooking oil as the branded items were available at over Rs600 per kg/litre.

“Flour costs Rs150-160 per kg as compared to Rs70-80 per kg last year. Income has eroded. It has become really impossible to save any rupee right now as compared to last year due to meteoric price hike in food items, school fees, petrol consumption and electricity bill,” Mr Khalid added.

Ibad Ullah, working at an IT firm on Sharea Faisal, says “me and my wife’s monthly food purchasing bill [flour, ghee/cooking oil, tea, sugar, beef, mutton, vegetables, milk products, ketchup, mayonnaise, rice, eggs, chicken, soap, toothpaste, washing powder, bread, etc,] has risen to Rs9,000 from Rs6,000-7,000 of last year.”

He said he spent Rs15,000 on petrol on an old 2006 Suzuki Cultus to reach office and other places as compared to Rs10,000 a month of last year.”

As per an agreement with the house owner, a 10 per cent increase is imminent in the yearly rent every year, he added.

Experts says cost of living has risen drastically

CEO of Top Line Securities Mohammad Sohail said: “The consumers’ cost of living has risen by an average 30pc in the last one year.”

While there were government administrative failures to control prices and aftermath of floods that destroyed cash crops, one of the main reasons for food inflation was triggered by rupee devaluation against the dollar, making imports of finished and raw material costlier, he added.

“I think the currency factor is one of the main reasons for flaring up food prices,” he said.

Mr Sohail said some good days were expected in the country depending on the IMF loan deal and exchange rate stability.

“Food inflation will fall below 30pc from June onwards in case the rupee gains stability or strengthens against the dollar,” he hoped.

Sensitive Price Indicators

As per data of Sensitive Price Indicators (SPI) based on the prices prevailing in 17 cities, the national average price of a 20kg flour bag is now Rs2,315-3,200 as compared to Rs800-1,500 a year back.

The retail price of five litre Dalda cooking oil is now Rs3,250-3,510 as compared to Rs2,060-2,485, while the price of one kg ghee pack is now Rs570-625 as compared to Rs399-484. Sugar is now available at Rs115-135 as against Rs83-95 per kg.

The national average price of loose milk and yogurt are currently at Rs120-220 and Rs140-320 as compared to Rs90-150 per litre and Rs100-240 per kg.

The price of Masoor, Moong, Mash and gram pulse has soared to Rs250-330, Rs240-330, Rs280-480 and Rs220-310 per kg from Rs197-250, Rs116-220, Rs200-320 and Rs148-200 per kg.

Beef with bones (average quality) price now hovers between Rs500 and Rs900 as compared to Rs500-750 per kg. Mutton now sells at Rs1,100-1,900 as against Rs1,050-1,500 per kg.

Lipton Tea (less than 250 gram pack) is now available at Rs413-558 as compared to Rs250-260.

Rice basmati broken (average quality) and Irri 6/9 (Sindh/Punjab) prices rose to Rs160-250 and Rs80-210 from Rs80-140 and Rs60-100 per kg.

However, a high quality basmati is not available for less than Rs400-450 per kg, which is almost double than last year.

The current price of potato, onion and tomato is Rs50-100, Rs60-140 and Rs30-120 per kg as against Rs20-60, Rs40-100 and Rs50-170 per kg.

Chairman of Karachi Wholesalers Grocers Association (KWGA) Rauf Ibrahim estimated an average 40pc rise in cost of living of consumers keeping in view increase in food items, utility bills, school fees, transportation, etc.

Government’s priority

“The government is still focusing more on fixing political issues thus leaving the economy in tatters,” he said, fearing more pressure on people and their families who are being offloaded from industries due to massive slowdown in production and raw material shortages.

An analyst at a brokerage house, who wished not to named, said that the government should have taken measures to curb imports by raising duties and taxes rather than putting restrictions on opening of letters of credit (LCs) on various items that fuelled inflation and raw material shortage and hit supply chain mechanism, thus encouraging arrival of goods through informal channels.

Besides, the government did not do anything to control energy bills for consumers and remained more occupied with political issues, he added.

One US dollar was equal to Rs181 a year ago as compared to Rs284.

Petrol and diesel rates have surged to Rs282 and Rs293 per litre from Rs152.62 and Rs145 per litre.

Published in Dawn, April 21st, 2023