It is troubling, though not entirely surprising, to note that inflation has outpaced income growth over the last few years, meaning dipping real incomes for the bulk of the population. What is really surprising, though, is that food inflation has remained much higher than overall inflation for most preceding years. Taken with the next worrying finding, that unemployment too has not so steadily risen, and you have a disturbing mix already wreaking havoc in far too many places in the world for authorities in Islamabad to continue fearlessly with their complacency.
Unfortunately, the government has been behind the curve on most of its promises, meaning budget debriefing at the fiscal-end will likely be the usual rerun of justifying falling short of targets, again. But with elections approaching, and governance in shambles, and development and growth targets badly off track, there is a real possibility of food inflation turning into the proverbial straw that breaks the camel’s back. With three-fourths of the population comprising youth, three-fourths of which is unemployed, the situation is grim. And it is made worse for those investing large sums in education only to find place in the unemployment queue.
Food inflation, which stokes unemployment, is yet another tale of inefficient use of limited resources. The government extends billions in subsidies and bailouts, most of which is channeled to non-productive avenues, which only bolsters the cycle of inefficiency. The time has come when Islamabad can no longer dilly-dally on issues of pressing concern. If inflation is not tamed, with special focus on food prices, the government will have only itself to blame if people-fury turns into a violent, rioting mob. The sums it would then spend to control agitation would be far greater than targeted subsidies needed to rationalise price distortions in the food market.
