The Pakistan Bureau of Statistics (PBS) released its Monthly Review on Price Indices for January 2020. The National Consumer Price Index, which shot up by 14.56 percent, actually broke a 12-year record. The most alarming jump took place in ‘perishable food items’ where the index shot up by a hefty 78 percent. Imagine; perishable food items were 78 percent cheaper just a year ago.
Another disturbing trend that I noticed is that prices are going up faster in rural areas than in urban areas. We always used to say that Pakistanis living in rural areas are better off as they have ready access to food items. Not true. Imagine: the prices of ‘perishable food items’ in rural areas actually shot up by 90 percent (as opposed to 78 percent in urban areas).
We must remember three things. One, incomes over the past 12 months have been flat. Two, around a million Pakistanis have lost their jobs. Three, around eight million Pakistanis have dived below the poverty line. And while all this is happening, the price of tomatoes went up by 211 percent, onions 136 percent, potatoes 111 percent, pulse moong 83 percent and wheat 32 percent.
The other surprise in the monthly review is that overall food inflation which stood at a meagre 1.6 percent at the beginning of 2019 had shot up to 25 percent in just one year. Remember, a good 60 percent of Pakistanis end up spending a good 60 percent of their incomes on food.
The State Bank of Pakistan (SBP) released its summary of ‘Pakistan’s Debt and Liabilities’. In June 2018, a couple of months before the PTI took over, our total debt and liabilities stood at Rs29,879 billion. Alarmingly, the same figure for September 2019 is Rs41,489 billion. So, it took us 71 years to accumulate a debt of Rs29,879 billion and a mere 15 months to add an additional debt of Rs11,610 billion. Imagine; 71 years to accumulate 72 percent of the debt and a mere 15 months to accumulated 27 percent.
The fact is that we are taking on debt faster than at any time in our 72-year history. The question is: where is all this debt going? Between 2008 and 2013, the PPP took on an average of Rs5 billion a day every day for five years. Between 2013 and 2018, the PML-N took on an average of Rs7.7 billion a day every day for five years. Over the past 15 months, the PTI has been adding Rs25 billion a day every day.
The Federal Board of Revenue (FBR) has informed the IMF that it has collected Rs2.4 trillion over the past seven months. The target was Rs2.8 trillion. This could potentially lead to a shortfall of Rs700 billion. Yes, the shortfall would be a 72-year record. The IMF now wants the FBR to collect Rs3.5 trillion by end-March or a colossal Rs550 billion every month for the following two months. Welcome hundreds of billions worth of new indirect taxes (since the FBR has no capacity to collect direct taxes). Welcome back the reverse Robin Hood.
The writer is a columnist based in Islamabad.
Email: farrukh15@hotmail.com Twitter: @saleemfarrukh
