KARACHI: Even though the value of the Pakistani rupee has improved against the dollar in recent months, and this has led to a decrease in the cost of imported goods like petrol, consumers haven’t really felt much relief in prices. This suggests that businesses haven’t passed on the savings from lower global prices to consumers, partly because the government hasn’t effectively monitored prices.
The dollar, which was at its highest at Rs307.10 on Sept 5, 2023, has dropped significantly, now trading at Rs277.91. A stronger local currency, combined with lower global commodity prices and reduced transportation costs, should ideally lead to lower prices for consumers.
However, experts point out that the increase in electricity and gas prices for local production has offset some of these benefits.
For example, the price of a 20kg bag of wheat flour has decreased from Rs2,600-3,200 to Rs2,380-2,800 between Sept 5, 2023, and March 2024. But prices for items like bread have remained the same, despite the drop in flour prices.
Similarly, prices for other items like sugar and pulses have also decreased. But consumers haven’t seen a significant drop in prices for products made from these ingredients.
While some prices have decreased, others have remained stable or even increased. For instance, the prices of petrol and diesel have gone down, but the cost of liquefied petroleum gas (LPG) has increased.
One factor contributing to higher prices is the ban on onion exports from India during Ramadan. This led to higher prices for onions in Pakistan. Now that the ban is lifted, local traders might stockpile onions to take advantage of the situation.
Prices for meat and rice have also increased, partly due to factors like increased exports and bans on certain types of rice by India.
While there have been some decreases in prices, consumers haven’t experienced significant relief, and in some cases, prices have even gone up.