In Pakistan prices of essential goods have been increased once again, further playing a critical role in straining household budgets, particularly for staples like ghee and cooking oil. Cooking oil has surged by Rs 30 per kilogram, bringing the price from Rs 530 to Rs 560. Likely, the price of ghee now is Rs 550 per kilogram.
Market dealers note that Karachi-branded ghee has reached Rs 500 per kilogram, marking a rise of Rs 120 in the past month alone. This surge comes as inflation and other economic pressures already stretch Pakistani households.
The Pakistan Bureau of Statistics (PBS) data indicate this massive rise, showing a 0.28% hike in the weekly inflation rate, measured by the Sensitive Price Indicator (SPI) for the week ending October 17. Moreover, the SPI tracks the prices of 51 essential items across all income groups and has risen to 319.79 points from 318.91 the previous week. Over the past year, the SPI highlights a 15.02% increase, reflecting continued inflationary pressures.
These increases hit low-income families hardest. For the lowest spending group, with monthly incomes up to Rs 17,732, the SPI rose by 0.27%, illustrating how inflation impacts these households. For many, rising costs mean making tough choices, often cutting back on necessities.
Read more: Weekly inflation jumps 0.11% due to higher food and electricity prices
The continued price hikes for essentials like ghee and cooking oil highlight the ongoing inflationary pressures that reflect broader economic challenges in Pakistan.
Hike in prices of ghee and oil is driven by various economic factors
Firstly, rising global commodity prices for edible oils, which are accelerated by supply chain issues, increased demand, and geopolitical factors, have made imports more expensive for Pakistan.
Secondly, the high inflation rate of Pakistan, which is intensified by increased fuel and utility prices, plays a critical role in the increased production and distribution costs. And this increase in production and distribution costs ultimately increases consumer prices on essential goods.
Thirdly, the declining value of the Pakistani rupee is a big factor in making imports more expensive specifically affecting goods like cooking oil {only produced partially on a domestic level. This devaluation highly intensifies the impact of global cost rise.
Fourthly, high import taxes and tariffs have raised costs on imported goods, directly impacting costs for consumers.
Fifthly, logistic delays and distribution supply chains, paired with rising fuel costs, are heavily increasing transportation costs, which leads to high rates and prices for consumers. These combined factors play a significant burden on household budgets, particularly for low-income families, leading to financial pressures all over the country.