The month of February is very important from the holding of general elections and the official announcement of the results to the passing of power and the coming four months are for the preparation and approval of the federal budget 2024-25. To protect the elected government from any emergency situation, the caretaker finance ministry has issued a budget schedule a day before the general elections, which is proposed to be presented to the National Assembly in the first week of June.

According to the schedule, all the budget documents will be finalized by the end of May. National Economic Council (NEC) meeting is scheduled to be held in the second week of May, while the annual meeting of the Planning Coordination Committee is scheduled to be held in the first week.

The bailout agreement is expiring on March 31, former Prime Minister Shehbaz Sharif said in this regard that the incoming government will have to go to the IMF immediately to get a new loan.

The common man has voted to reduce inflation as much as possible or eliminate it with the belief that the new government will bring the economy out of the economic vortex.

According to the program issued by the caretaker government, it will present its proposals to the new government and before this, it will be approved by the Executive Board of the IMF so that if the elected government wants a loan program, it can advance the agenda without wasting time.

The caretaker govt has promised to get rid of inflation to the people, which must be fundamental in the preparation of the budget.

However, the situaiton is not in control and inflationary trends are at peak.

Headline inflation got pace for the second consecutive month  last month, increasing to 29.7 per cent year-on-year basis from 29.2pc in NOvember,  mainly due to incraesing prices of essential kitchen commodities and electricity prices.

A lot of expectations were pinned on the New Year, but even in 2024, inflation welcomed the people, the dream of reducing inflation remained a dream. The prices of vegetables increased by more than 100%. Tomato, which fetched Rs 45 per kg at the start of 2023, is available at Rs 100 per kg in 2024. Last year potato was Rs 50 per kg, now it is available for Rs 80, ginger which was Rs 500, became Rs 800 per kg on New Year. The price of onion also brought tears to the eyes of the people, an onion priced at Rs 200 went above Rs 250.

Last year, the gourd sold at Rs 60 per kg reached Rs 160, the peas of Rs 100 per kg went from Rs 200 to Rs 300. Peppers which were available at Rs 200 at the beginning of 2023 is now being sold at Rs 320 on New Year. Financial gurus say that food inflation is the main issue as  it stood for December at 28.8pc in urban areas and even higher at 29.3pc in rural areas.

On the other hand, the non-food inflation was over 32 per cent  in urban areas and  over 26.4pc in rural areas.

And more importantly, the Core inflation, which revoves around the volatile food and energy prices, lingered around at 18.2pc in urban centres which is on the high side as compared to last month. In rural areas, the same was recorded at 25.1pc, down from 26 per cent.

In urban centres, the kitchen items witnessed the highest annual rise in prices during last six to seven days of December, fresh vegetables  registered  a 65.41pc increase while wheat flour (59.03pc) qne sugar (49pc) also recorded an increase.

Others items like potatoes (46.76pc), rice (45.60pc), pulse mash (43.70pc), wheat products (38.94pc), tea (37.77pc), pulse masoor (32.29pc), wheat (29.04pc), eggs (26.76pc), milk fresh (21.77pc), tomatoes (20.96pc), fish (20.29pc), meat (17.42pc), chicken (17.07pc), pulse moong (12.77pc), gram whole (11.98pc), pulse gram (3.90pc), fresh fruits (3.19pc) and cooking oil (2.58pc) also were on the high side.

Yes, the latest statistics on the price-hike and inflaiton are really disappointing and points to rather difficult times for the masses in the current situation when food prices have escalated beyond imagination and beyond reach of the common man as rupee has lost its value and inflation is at its peak.

The kitchen budget only broke the back of the poor people. The prices of flour, rice, ghee, oil, pulses, sugar, beverages, spices and other essential items increased sharply.

Large increases were seen in the prices of electricity, gas and petroleum products. Economic indicators also seem to be falling. The external debt burden increased further. There was a mixed trend in remittances from overseas Pakistanis.

On the contrary, the economic report released by the Ministry of Finance last week, it is claimed that the inflation rate will decrease in the coming months, but the ground reality does not match it prices are gradualling icreasing.

Another issueis the food shortage and a looming food crisis have been termed to be the real concerns for Pakistanis right now as prices are increasing behind imagination. Though the food prices inflation and shortage had already been an issue after the corona pandemic but after the summer floods, which damaged an estimated eighty per cent of our standing food crops including wheat, rice and sugarcane, food shortage has risen to a level to become a real concern. The shopkeepers and the middlemen mafia are also making life hell for the common man as they contribute their bit to high prices of essentials.

In the other conditions of the country's economy, a very encouraging situation has emerged that exports reached 2 billion 812 million dollars in December after an annual increase of 22.21%. Imports and trade deficit have come down significantly so this trend should not be temporary.

According to the data released by the Bureau of Statistics, exports increased by 9.29% on a monthly basis January.

After an increase of 5.17% during July to December 2023, they reached 14 billion 98 million dollars, this volume was the same period of the last financial year. 14 billion 24 billion dollars was recorded during 2023. During July to December 2023, the trade deficit was 11 billion 15 billion dollars after a decrease of 34.29%, while the trade deficit decreased by 40% on an annual basis.

Published in The Daily National Courier, February, 10 2024

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