During times of high inflation, everybody gets a hit but the poorest of the poor suffer the most. For them, buying day-to-day essential commodities for themselves and for their loved ones at a higher price becomes a nightmare. This is why keeping the prices of necessities low for the citizens should be a priority for the government.

It is fairly easy to issue a directive that declares the exact price of a certain essential commodity throughout a jurisdiction. However, long term price control is a supply-and-demand problem. The dynamics of the free market decide the equilibrium price, which is dependent on several factors. Shop rents, for example, vary from city to city and from locality to locality.

Growing sales require a bigger, brighter, shinier and fresher shopping experience. Spending has to be done on advertisements to attract heavy customer traffic. Fast-moving consumer goods incur a lot of waste that has to be incorporated into the costing equation.

Transport and storage costs of goods across the supply-chain are different for different locations. Then there is the added cost of documentation and taxation. Talent and the availability of skilled and unskilled workforce also varies across cities.

Due to all these factors, it is completely illogical to expect the same price of essential commodities across the country, province, or even the same district. Therefore, trying to forcibly fix the price of a commodity at a certain level is not going to work.

A much better way to control prices is to allow the free market to take its natural course, by allowing it to have access to better data, in order to make better decisions. If the demand and supply are measured accurately, then by just regulating supplies to wholesale commodity markets, prices of individual commodities can be controlled to an affordable level.

A central digital girdawari is going to play a critical role in this regard. Manual khasra girdawari is currently being used to record the type and quantity of crops being grown by farmers on their agricultural lands.

If this girdawari data is digitised and made easily accessible to the department of National Food Security, this will give them the much needed insights into the expected surpluses and shortages in the country, which will help them propose better import/export interventions to the federal government.

Furthermore, this can play a critical part in identifying false shortages and to check on how much is being hoarded away in “unknown places”. It will also immensely help during times of natural disasters to assess and settle losses.

Automating the wholesale commodity markets is another critical missing link. In these markets, all the financial transactions can be done electronically via context-driven digital payments gateway, whereby the government would know if the payment is against an invoice or an agreement, full or partial, for some service rendered or goods delivered.

We can digitally monitor and track the whole economic sphere enabling us to make the right revenue and taxation policies. This will have a drastic impact on our exports and domestic business activity.

Thus, all buying and selling data - like the quantity of potatoes delivered and bought on a certain day; along with the daily fluctuation information of its prices like the minimum, maximum, average - can be made available for display on digital boards, in real time, in every commodity market for all growers and sellers.

Imagine a farmer entering these markets to sell his produce. He would instantly know what the current sale/purchase price of his commodity is, without being exploited by buyers or their touts.

The data generated as a result of this automation should be made available to supply regulators to keep an eye out for anomalies and to other stakeholders operating within the supply chain to better predict a surge in demand for certain commodities on certain occasions e.g. during, before, and after socio-cultural events like Ramazan, Eid and Ashura and make their business plans accordingly.

Once the entire system is in place, it will not just stop at price control. We can digitally monitor and track the whole economic sphere enabling us to make the right revenue and taxation policies. It will have a drastic impact on our exports and domestic business activity.

For the first time in our history, we might finally be in a position to measure and analyse the effectiveness of our policies in a concrete way. Thus, to move forward in controlling prices the right way, the short-term strategy would be to engage supply chain consultants as opposed to economists and finance experts.

In the long run, institutionalising supply chain expertise in the government is strongly recommended, aided with tools like big data, supply chain management, artificial intelligence and machine learning.

The writer is Head of Software Engineering at PITB since 2011. He is also Member PM’s Task Force on Austerity and Restructuring