Imported Inflation and its impact on the people of Pakistan

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Jahanzaib Ashiq Satti
World is global village and any change in one economy will have a ripple effect on the rest of the others. Therefore, they must take care of each other for their mutual interest. But unfortunately, in the race of becoming more powerful we neglect our mutual interest and focuses on individual interests as a result every economy specially developing economy like Pakistan suffers a lot from the selfish attitude of the powerful economies In the end of 2019, COVID-19 started to affect the world economy and became the pandemic and shacked the whole world. By the grace of Allah, it did not affect the economy of Pakistan like other economies but being a part of the global economy it casted an impact on Pakistan economy. After successful recovery from this pandemic, the world is facing another crisis of oil prices in the international market due to Russia and Ukraine war. Since Pakistan is oil importing country, we must suffer a lot due to international sanctions on Russia, a biggest producer of oil and as a counterattack Russia stopped oil supplies to European countries to put pressure on international bodies for uplifting sanctions. on the other hand, Ukraine exports wheat and palm oil, due to massive war wheat and palm oil tended short in international market which resulted in increase of their prices and adversely effected the cost of daily consumable products. Currently, Pakistan is facing running inflation with the annual rate of 24.9% in July 2022 and being an import dependent economy, it has no control over inflation. The oil is the dominant factor that affects every product. The rate of petrol almost doubled in June over a year ago, followed by 87% increase in electricity prices and uncontrolled crucial kitchen items, which eroded the purchasing power of the people. Latest survey shows that 81% Pakistani’s have downgraded their lifestyle due to inflation. Therefore, Government should take emergency actions to use alternative energy sources and take corrective measures to reduce dependence on others. It can be done by reducing imports and increasing exports, that will help them in minimizing inflation effects on the people of Pakistan.

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