01 Apr 2023, 16:00

Inflation at 50-year high in crisis-hit Pakistan

ISLAMABAD, April 1, 2023 (BSS/AFP) - Pakistan's year-on-year inflation hit 
35.37 percent in March -- the highest in nearly five decades -- as the 
government scrambled to meet International Monetary Fund (IMF) conditions to 
unlock a desperately needed bailout. 

Month-on-month inflation was 3.72 percent, according to government data 
released Saturday, while the average inflation rate for the past year was 
27.26 percent.

Years of financial mismanagement and political instability have pushed 
Pakistan's economy to the brink of collapse, exacerbated by a global energy 
crisis and devastating floods that submerged a third of the country in 2022.

The country needs billions of dollars of financing to service existing debt, 
while foreign exchange reserves have dwindled and the rupee is in freefall.

Poor Pakistanis are feeling the brunt of the economic turmoil, and at least 
20 people have been killed since the start of the Muslim fasting month of 
Ramadan in crowd crushes at food distribution centres.

"The way inflation is rising, I believe a famine-like situation has been 
simmering," said Shahida Wizarat, a Karachi-based analyst. 

At least 12 people were killed Friday in a crowd crush in Pakistan's southern 
city of Karachi at a factory distributing Ramadan alms.

The South Asian nation -- home to more than 220 million -- is deep in debt 
and must enact tough tax reforms and push up utility prices if it hopes to 
unlock another tranche of a $6.5 billion IMF bailout and avoid defaulting.

Inflation is expected to stay at "elevated" levels, the finance ministry 
said, "owing to market frictions caused by relative demand and supply gap of 
essential items, exchange rate depreciation and recent upward adjustment of 
administered prices of petrol and diesel."

  • Latest News
  • Most View