Rising food prices

NOTWITHSTANDING the claims of the government about a positive turnaround in the economy, the life of common people in Pakistan is becoming increasingly difficult. Not only the law and order situation has become messier, but the prices of basic necessities of life, especially food, are getting out of reach for the common man. According to the latest Consumer Price Index (CPI) released by the government, food inflation during October, 2007, was up by 14.6 percent as compared to October, 2006. Last year, the rate of increase was somewhat smaller at 10.5 percent. Food inflation, the government says, accelerated due “to an extraordinary surge in demand for food items, particularly fruits, vegetables, milk, meat, poultry, cooking oil during the month of Ramazan and the commencement of wedding season after the Eid festival. Furthermore, the month of October also witnessed a sharp pick-up in wheat and flour prices, totally driven by extra-market forces”. Overall inflation, as measured by CPI, also rose at a higher rate of 9.3 percent as compared to 8.1 percent last year. Non-food, non-energy inflation, called core inflation by the policy makers, was up by 5.8 percent as against 5.7 percent in the corresponding month of the previous year. According to the government, “tight monetary policy pursued by the country’s central bank is mainly responsible for stability in core inflation”. Food inflation during the first four months (July-October) of the current fiscal was a matter of great concern. At 11.2 percent, the average food inflation was higher than 10.0 percent compared to a year ago. However, the overall CPI recorded a lower growth of 7.6 percent as against 8.3 percent during July-October, 2006. The deceleration in the rate of overall inflation was due to lower increase in non-food, non-energy or core inflation. In order to probably ease the anxiety of the public at large about the rising food prices, the government has claimed that food inflation is likely to decelerate at the start of the new calendar year in a month’s time. Moreover, food inflation is a worldwide phenomenon and “has emerged as a major source of concern for the policy makers in emerging Asia, including Pakistan”. The emerging inflationary scenario, in our view, is highly disturbing. In a country where one fourth of the population is living below the poverty line and spending an overwhelming proportion of their incomes on food items to keep their body and soul together, a rise of about 25 percent in food inflation in about two years’ time could simply be described as devastating. Also to be noted is the fact that most of the people believe the official figures on inflation to be underestimated and not reflective of the actual market conditions. Such a huge increase in food inflation could probably have been somewhat tolerable if the gains of high GDP growth in the recent years would have trickled down to the lower strata of society.
In the absence of such an automatism, the result of such an untoward development on the lives of ordinary people, particularly the poor, can easily be imagined. The reasons being given by the government for this ugly situation cannot alleviate the sufferings of these people and are not convincing either. Most of the food items consumed by ordinary people are grown within the country and Ramazan and wedding season did not happen only in 2007. We strongly feel that it is time for the government to think seriously about the rising food prices and formulate policies to ensure that at least the prices of basic food items like wheat, wheat flour, sugar, edible oils and pulses remain within the reach of the common man. First of all, it needs to be investigated why certain parts of the country like Punjab which used to be the granary of undivided India have lost their capacity even to feed their own inhabitants. The agricultural productivity in these areas is much below their potential and can be improved with the right kind of policy incentives. Secondly, inaccurate crop estimates made by the government agencies and sudden shifts in policies from time to time have resulted in wide fluctuations in the prices of certain food items like wheat and sugar. This needs to be avoided in order to ensure timely import of commodities which are likely to be in short supply in the market.

What happened?

ACCORDING to his former press secretary and trusted aide of seven years, Scott McClellan, President Bush knew very well that undercover CIA agent Valerie Plame was outed by White House leaks and may even have been party to the plan. It seems, however, that everyone must wait until April, when McClellan’s book “What Happened” is published, to find out precisely what the president and Vice President Dick Cheney actually knew about the unmasking of Plame, which was committed allegedly in revenge for her ambassador husband Joseph Wilson’s revelation that part of the administration’s WMD claims were hokum. All McClellan would say Tuesday at a “teaser” press conference for the book subtitled “Inside the Bush White House and What’s Wrong with Washington”, was that he had “unwittingly” passed on false information to the press that top aides Lewis “Scooter” Libby and Karl Rove were not involved in the Plame leaks. McClellan says that five people, including the president, vice president, Libby and Rove, knew this was false. While the former press secretary’s desire to profit from a best seller is understandable, it is simply not good enough that he should be sitting on evidence of such fundamental importance. Indeed, it may be wondered where McClellan was when Libby was on trial for the leak. Libby was found guilty only on four lesser charges of blocking the subsequent investigation, fined $250,000 and sentenced to 30 months in jail. Bush immediately commuted this punishment because it was “excessive”.
If McClellan had told investigators then what he alleges now about the uncharged Rove, as well as Libby, then the outcome for both men might have been very different. As puzzling as McClellan’s silence is this week’s press conference, fully five months before his book is due to hit the streets. Could it be that he felt obliged to go public to escape pressure being applied by the White House? McClellan may very well be a troubled man. He was Bush’s communications director when the president was governor of Texas. He ran three gubernatorial campaigns and was the key press aide during the 2000 presidential campaign. He served as principal White House press secretary from 2003 until last year. It may be that he saw and deplored the changes the presidency brought on his boss. Maybe he stayed on out of a blend of loyalty and pleasure at being so close to the seat of power. But, with his book, he has betrayed his old boss. Perhaps the more important question to ask is: Why? McClellan is unlikely to be able to keep his revelations secret until the spring. If he is telling the truth then he is holding the Iraq invasion’s long-sought smoking gun. The Democrat-dominated Congress may subpoena him to give evidence to an enquiry. The federal prosecutor might want to hear his evidence about Rove and know why he kept quiet during Libby’s trial. No one will wait until April.

—Arab News