IT is a matter of grave concern that non-stop inflation, which was number one problem of the people of Pakistan before general elections and during the first year of the present Government, is back again and there seems to be no plan in sight to address the challenge in the foreseeable future. This is confirmed by the data released officially by the Pakistan Bureau of Statistics (PBS), which showed inflation surged to a 22-month high of 11.7 percent in May 2026 and that the month’s reading was more than triple the 3.46 percent recorded in the same month a year ago. The eleven-month (July-May) average inflation for the current fiscal year stands at 6.7 percent, compared with 4.6 percent for the same period a year earlier.
The Government absolves itself of the responsibility for the latest inflationary pressures linking it to tensions in the Strait of Hormuz but now it is an open secret that the authorities concerned are using shoulders of the International Monetary Fund (IMF) and the Gulf war to implement bitter measures, which would, otherwise, have been difficult for the elected Government to implement. Pakistan has become, perhaps, the only country of the globe to have exploited the situation caused by the regional war to expand tax collection at the cost of the common man and allowing the elite and pressure groups to go scot free. This is evident from the fact that fuel and energy costs had a lion’s share in the steep rise in inflation. Transport costs led the surge, jumping to 36.8 percent year-on-year from 29.9 percent in April. Petrol and diesel prices remain roughly 48 percent and 38 percent above their pre-conflict levels, respectively. Motor fuel alone rose 51.9 percent annually, liquefied hydrocarbons 49.4 percent and electricity charges 36.5 percent. Gas charges were up 22.9 percent over the same month last year. The reckless hike in the petroleum levy is a clear proof of the Government’s apathy towards the plight of the people as transport and energy costs pushed prices of almost all goods and services including food items. Among food staples, wheat surged 62.1 percent year-on-year, wheat flour 54.4 percent and onions 52.7 percent. Tomatoes rose 25.8 percent, meat 14.1 percent and wheat products 12 percent. Housing and utilities inflation held elevated at 16.8 percent, clothing and footwear rose to 8.8 percent from 6.2 percent and furnishing and household equipment to 5.1 percent from 3.8 percent in April. The situation is likely to aggravate further in the months to come as the Government has committed to the IMF to hike further prices of electricity and gas, collect more through petroleum levy and follow the so-called liberal foreign exchange regime, which always means further devaluation of the rupee despite the fact that the country never witnessed benefits that policy-makers refer to while axing the national currency. Failure to tax the wealthy, inability to move towards the goal of industrialization and modernization of agriculture, shrinking exports and negligible investment speak of the challenges we continue to face in realizing the objective of growth and development. What a tragedy that the poor electricity consumers were burdened with significant fixed charges per month to fund the subsidy being provided to the industry but the measure has apparently not resulted in an increase in production/exports or a reduction in the prices of products in the domestic market! Prime Minister Shehbaz Sharif has assured businessmen and industrialists that measures were being taken to make the forthcoming federal budget conducive to industrial growth and production but one fails to understand how the objective can be realized in the backdrop of a sharp hike in the cost of inputs.
