Hyperinflation — what it does to a society

November 24, 2019

Does the government have a plan to rein in inflation that has hit the common man hard?

Master Ghulam Jaffar, an artist based in Rawalpindi, has started skipping his day-time meal as he can no longer pay for a meal three times a day given the rising prices and limited work opportunities.

The 59-year-old drummer says he has never asked anyone for financial support but sky-high prices have forced him to approach charity food outlets.

In a poor business environment, he says, he has started thinking of giving up his insecure profession and look for other work so that he can manage three meals for a day for himself and his family.

“I have never faced such a bad economic situation,” he says. Jaffar has been a professional drum-beater for the past three decades. Along with his sons, he has been performing at various events in Rawalpindi and Islamabad. This has been a major source of their livelihood.

Since last year, the imposition of heavy taxes has added to the troubles of small and medium industries and businesses. According to Jaffar, dearness has directly affected their business as people now avoid spending money on arranging events. He holds the government responsible for high inflation and decline in business.

Earlier, he says, he had been earning Rs 15,000 to Rs 20,000 monthly which provided bread and butter for his children. Since the PTI government imposed new taxes, he says, it has become increasingly difficult to make both ends meet. Currently, he finds it hard to earn Rs10,000 a month.

“What can we do in such a situation, except not send our children to schools, skip meals or cut down on health expenses?” says Sultan, another performer sitting beside Jaffar.

Jaffar is good at beating two-headed drums. He an also play shehnai and perform a bhangra. He says he started playing drums when he was 12 and has been performing in Rawalpindi and Islamabad for the past three decades. Jaffar’s son, Akbar, says roti that cost Rs 10 last year now costs Rs 15.”

Adil Saleem, a grocery store owner, says an estimated 50 percent inflation has been recorded since the PTI government assumed charge of the country in July 2018.

“Prices of grocery items increase too frequently to keep track of,” says Saleem.

As the government imposes new taxes on various products, shopkeepers raise their rates. “Customers don’t understand this and sometimes get offended,” he added. Customers hold us responsible for this recurrent hikes in items of grocery prices,” Saleem says. He says prices of children-related items, for instance, have risen by as much as one hundred percent.

Making a comparison between the last year’s and this year’s prices, Saleem says the price of a packet of ghee was Rs140 last year; its price today is Rs 171 this year. Similarly, the prices of milk, sugar, flour, and other food items have witnessed notable increase during the last few months.

Lubna Hameed, a housewife in Rawalpindi, says the budget of her home was Rs 30,000 but now it is impossible to manage within this budget as prices of some household items have as much as doubled.

According to a Gilani Research Foundation survey, conducted during October 7-20, 2019, 53 percent of Pakistanis believe that inflation is the biggest problem faced by Pakistan these days. A national representative sample of men and women from across the country was asked what is the biggest problem faced by Pakistan these days.

In response, 53 percent identified inflation, 23 percent said unemployment, 8 percent said the Kashmir issue, 4 percent said water crisis, 2 percent said political instability, 2 percent said dengue fever, 1 percent said loadshedding and 2 percent identified other problems. The research survey was carried out during October 7-20, 2019.

The Quaid-i-Azam University’s Sociology Department Head, Dr M Zaman, says the high inflation will leave long-lasting impacts on the society. Criticising the government for promoting social inequality, he says the government, instead of taking measures to ease the financial environment for the common people, has created numerous problems for it.

He believes that the government should lower the lending rate and reduce taxes to bridge the growing gap between the rich and the poor. “The government has increased the interest rates which is a bonus for the rich but this has pushed millions of people below the poverty line. The rich, instead of investing in business and creating job opportunities, now prefer depositing their money in banks to earn easy profits.”

Dr Zaman says inflation will not only damage the ruling party’s credibility with the voters but also have long-lasting implications for the society.

According to the State Bank of Pakistan, the customer price index (CPI) inflation on year-on-year basis in federal and provincial capitals of Pakistan showed mixed trend during September 2019. Among these five cities, the lowest inflation was observed in Lahore at 9.9 percent while the highest inflation was observed in Karachi at 15.7 percent.

Income group-wise data shows that the highest income groups (above Rs 35,000) has been worst hit by inflation as compared to other quintiles in non-food group and income group with income between Rs 18,001 to Rs 35,000 witnessed higher inflation as compared to other quintiles in overall CPI during September 2019.

The lowest income group (having an income of up to Rs 8,000) observed the lowest inflation in CPI during the month of September 2019 and the income group above Rs35,000 witnessed lower inflation as compared to other quintiles in food group during the last month, the SBP report showed.

These trends are dangerous for a society and can give rise to new social evils and an increase in crime rate.


The writer is an investigative journalist based in Rawalpindi and a PhD aspirant. She can be approached at shaziamehboob27@gmail.com

Hyperinflation in Pakistani society and its impacts