Consumer price inflation in Pakistan second highest in South Asia: World Bank

ISLAMABAD: The consumer price inflation for food items in Pakistan was 45.1 per cent in February 2023 on a year-on-year basis – the highest in South Asia after Sri Lanka with 54.4 per cent, says the World Bank.

The bank, in its latest “Food Security Update”, stated that across South Asia, domestic grain and wheat flour prices remain volatile in the beginning of 2023 and well above their year-earlier levels. In Pakistan, wheat flour prices in January 2023 reached record highs and were 20 to 140 percent higher year on year.

The Food and Agriculture Organization of the United Nation (FAO) attributes the high prices to generally stagnant production since 2018, stock losses and disrupted trade flows due to the 2022 floods, high agricultural input and transportation costs, and high headline inflation.

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The report noted that in January 2023, year-on-year consumer price inflation for food prices was 6.2 per cent in India, 7.8 percent in Bangladesh, and 5.6 per cent in Nepal.

The report noted that rice production in 2022 increased thanks to increases in several countries, including India, despite reductions in Pakistan and Tanzania.

The US Department of Agriculture also predicts a 4.5 percent contraction in rice shipments because a decrease in exports from Pakistan, Thailand, the United States, and Vietnam, should more than offset an increase from India. Domestic food price inflation remains high around the world.

Information from the latest month between October 2022 and February 2023 for which food price inflation data are available shows high inflation in almost all low- and middle-income countries, with inflation levels above five percent in 94.1 percent of low-income countries, 86 percent of lower-middle-income countries, and 87 percent of upper-middle-income countries and many experiencing double-digit inflation.

In addition, about 87.3 percent of high-income countries are experiencing high food price inflation. The countries affected most are in Africa, North America, Latin America, South Asia, Europe, and Central Asia, stated the report.

Copyright Business Recorder, 2023