Cost of Living: Inflation 2006?

Posted on December 31, 2006
Filed Under >Adil Najam, Economy & Development, Society
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Adil Najam

One of the great untold stories of 2006 may have been how economic existence for poor and middle class Pakistanis continued to become harder (here, here and here) even as a number of macroeconomic indicators seemed to do well. Some would say that eventually the benefits of macroeconomic growth will trickle down. But eventually can come too late for some.

A survey conducted by Dawn in Islamabad reports that “the prices of 36 daily-use items witnessed an upward trend compared to last year [2006].” (click on image for larger view)

…the prices of pulses registered a phenomenal increase during December 2006 over the corresponding period last year. The prices of moong (washed) went up by 32 percent, mash (washed) 43 percent and gram (washed) by 48 percent. This increase was despite the government’s subsidies announced a few months back to stabilise the rates of the commodities in the market.

Among other items, the prices of onions and tomatoes increased by 163 percent and 133 percent, respectively. Prices of salt, red chillies and garlic also increased by 20 percent, 50 percent and 25 percent.

Energy prices were, of course, another major area that broke the back of the poor and middle class:

The prices of gas rose by 20 percent, petrol 2.5 percent and diesel 4.16 percent during December 2006 compared to the corresponding period last year. Ahsanullah, a lower division clerk, said his utility bill had increased from Rs300 to Rs2,000 � a good half of his whole salary.

As we wrap up the year 2006, looking back at how the prices of these essential commodities went up is sobering. These are commodities that everyone needs and the price hike demonstrates the burdens on the poor. ‘Inflation’ is the word that many have thought of but few have dared say in 2006. It may be a word that we will continue to whisper in 2006. Whether this is inflation or not can be debated, but it is still an indication of the economic challenges for the middle class.

Speaking of 2006, we are about to close our ATP Poll on the Impacts of 2006. The results till now are as follows (more detailed analysis later). If you have not voted yet, please do so.

17 responses to “Cost of Living: Inflation 2006?”

  1. My dear readers,

    I understand that the inflation is reaching unbelievable hights in Pakistan but complainning is not the only thing which can help us.Government of Pakistan,Establishment and the “Ruling” Military forces have their problems and we cannot expact them to help us out.The only practical thing we have available to us is a self made system.

    1, Please make a budjet according to your income.

    2,If you cannot afford luxury,Forget it,Dont use a car,or a motorcycle,Use public transport instead.

    3,If you are going to be married soon,Do it as our Prophet Mohammad Pbuh. did (Simple).All what a marriage need is Nikah.No expensive dinners are required.

    4,At home,One dish policy is the best policy even when you have guests.Tell them to adopt this policy if they want a peaceful life too.

    5,We dont have to buy new clothes on every ocassion.The suit i bought on last Eid is as good as new.

    6,Repair your clothes as Hazoor did.Get your shoes repaired.
    Teach your wife to give you a better hair cut.Shave yourself.

    7,Tell your married sisters to stay with their husbands instead of comming to “Mamoon jan” at the time of children,s school holidays.Two months of holidays with five of her children can ruin your economy for the rest of the year.

    8,Tell mom that this is no obligation of yours to send huge Eid gifts to seven of her daughters (Your married sisters).You shouldnt be punished for mom,s “Crimes”.

    9,Love your wife and the only child of your own.Why should you have many children when you can proove your “Manhud” with just one child ?

    10,Never give a penny to so called religious “Peers”.Why should they lead a luxurios life on your expense ?

    I can give you many more suggestions but you are all quite intelligent people.Just take care of your economy yourself and do not wait inflation to be in control of our Governments.Our political leaders have their personal needs and no Pakistani Government stay in power for long enough,So that they feel satisfied for their personal economy.

    Do it yourself,This is the only possible way to survive in Pakistan.

  2. Hasan says:

    I wish to appeal to all for some financial assistance in the form of a Loan, if anyone can help me. I am in a desperate situation, and would also be willing to return the loan according to mutually agreed terms. Please, if anyne can, call 03002227341 or mail for discussion. Thank you.

  3. obaid patel says:

    Modern Era is the Era of declineing value

    Nowdays vulgarity is common because people forget the Islamic cultuer and use the foriegn cultuer their dress their festival that’swhy this era is not best for the futer

  4. irfan patel says:

    science inventions only for rich man.
    If u have money so u puchase any thing easily if u don’t have money so….

  5. Saleem says:

    When we talk about prices we should also talk about wages. Both are inter-related yo each other. Please compare the price rises with wage rises too. If one earns Rs 1000 in a job than a thing costing Rs 200 would look very expensive, compare to same person in same job earning Rs 5000 and same thing costing Rs 500. So, please compare prices and wages together. Thanks.

    As for price rise, what I believe that overall price (average prices of all goods and services) has increased by around 60 percent during last 8 years … some more and some less. On other hand, wages in Pakistan has increased by around 300 percent during last 8 years from 1999 to 2007.

    [PPP senetar Enver Baig in around mid 2007 gave lower figure than 60 percent when quoting price rise in Senate over last 8 years. SBP figures consider price rise over last 8 years at around 53 percent or so].

    For instance salary of Chief Justice of Pakistan was around Rs 20000 in 1998 and today it is Rs 134000 or gone up by much over 600 percent. Minimum wage was around Rs 1200 in 1999 and today it is Rs 4600.

    Please can anyone put the salary of Pakistan government officers from grade 1 to 22 … what it was in 1999 and what it is today in 2007. I would be very obliged. Thanks.

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