Stories about inflation

Why does the government continue to increase electricity prices?

The price hike for electricity recently announced by the government was neither surprising nor unexpected. However, there are some key questions related to this decision that need to be addressed. Why was this done? What does it mean for ordinary citizens? And, what can we expect in the future? Why another power tariff hike? Let’s begin with why the decision was taken. To increase social welfare and allay price pressure, governments provide subsidies to different segments of the population. Subsidies are designed to help people buy products and services they cannot otherwise afford. With the recent decision to raise the electricity ...

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Ali Amin Gandapur and the PTI fool’s paradise

Pakistan is fast transforming into a utopia, in the eyes of Pakistan Tehreek-e-Insaf (PTI) politicians anyway. The mental gymnastics members of the incumbent government continue to employ in order to delude themselves into believing that every sector in Pakistan has only been rocketing skywards under their watch is so commonplace now that it almost no longer comes across as a cause for concern. Almost. But the public is not naïve enough to buy into this narrative. It is no secret that the Pakistani masses have been burdened with rising prices any many amenities and staple foods are increasingly becoming ...

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Why is the Indian government ignoring all the economic red flags?

Owing to a “weaker than expected outlook” for domestic demand in India, the International Monetary Fund (IMF) has projected that India’s growth rate will undergo a downward revision by 0.3% for the fiscal year 2019-20. As the Indian media and government keeps deflecting rising economic concerns, the massive economic slowdown that seems to impact a vast majority of the Indian public has led to the ringing of alarm bells in some quarters. The government statistics for the first quarter of the year (Q1) showed that the Gross Domestic Product (GDP) grew by 5%, the lowest Q1 growth rate India has ...

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Spilling tea with Asad Umar: Being a finance minister is ‘tough’

Right after his meetings with the International Monetary Fund (IMF) in Washington, I had the opportunity to sit down for tea with Finance Minister Asad Umar at the Pakistani consulate in New York City. We talked about his negotiations with the IMF, unpacked his outlook on the Pakistani economy as well as the personal toll this job is taking on him. The second thing I noticed about Umar when he entered the room was how tall he actually is in person. The first thing I noticed was how visibly exhausted he looks. By nature, he is an irrepressibly optimistic ...

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The ghosts of Imran Khan’s past: When PTI criticised PML-N for petroleum price hikes

The rising inflation, the dwindling foreign reserves and the growing current account deficit have all practically halted the progress of the country’s economy for the last seven to eight months. The Pakistan Tehreek-e-Insaf (PTI) government still seems clueless about how to put the economy on the right track again, and in order to collect more revenue to generate resources for its expenses, it has now increased the prices of petroleum products. After a price hike of Rs6, petrol now stands at Rs98.89 per litre. At a time when the masses are finding it almost impossible to manage necessary expenses ...

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Pakistan’s economy: Rising through the storms

In Pakistan, the financial year ends on June 30th. However, since the conventional year is about to end, we look back at how the new government fared at handling the economy and also make some policy prescriptions along the way. The incumbent government is being judged rather harshly on its performance in the first few months. Let’s just make this clear: there is no silver bullet that could end Pakistan’s economic woes within 100 days. Given that the government has inherited a ‘broken’ economy, I’d say that they have performed quite well. A common way to find out how well a country ...

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They say the gas price hike will not affect the common man, but that’s not true

At no other time in Pakistan’s recent history were people’s expectations as high as they were after the 2018 General Elections. The Pakistan Tehreek-e-Insaf (PTI) chief and his associates had practically promised the moon to the masses in their pre-election campaign. Murad Saeed had even guaranteed that half of the $200 billion in foreign bank accounts of corrupt Pakistanis, would be brought back within two days after the formation of his party’s government. But Imran Khan rewarded this fake degree holder and miracle man (who had allegedly given and passed three exams in just half an hour) by making him ...

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Khursheed Shah should take a look at PPP’s abysmal economic performance before pointing fingers at PML-N

Any accusation, any labels of incompetence hurled at Pakistani politicians have a very easy retort – the other guy is worse. Since a new election is on the horizon, our politicians have taken to this time honed art of mud-slinging with a new fervour. Khursheed Shah has come out with a statement that Pakistan’s economy has significantly deteriorated during the tenure of the Pakistan Muslim League-Nawaz (PML-N) government. Perhaps he’s forgetting Pakistan Peoples Party’s (PPP) very dismal economic performance during its last stint. There are many facets of governance and politics which are hard to measure. Fortunately, economic performance is not one of them. ...

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Would you invest in Bitcoin, the future of global currency?

Mark Hanna, a student at New York University (NYU) in 2011, bought a few odd Bitcoins for a $1 each from some guy in Canada through PayPal. He only bought those novelty digital coins to purchase illicit drugs through Silk Road – an online black market – which had begun to use Bitcoin to hide its transactions from governmental oversight. If Hanna had seen Bitcoin as a speculative asset instead, and somehow managed to hold on to his Bitcoin for six years, each one of his Bitcoin would have been worth $11,000 today – the new high reached by Bitcoin on Wednesday ...

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Bhutto’s economic policies were disastrous for Pakistan

In his article published in the May edition of Newsline, an independent monthly news magazine, economic journalist, Muhammad Ziauddin, says “a levelling phase” began in Pakistan with the advent of the Bhutto era, which forced the “22 families to flee the country with their loot.” He adds that the “phase of levelling inequality” was cut short quickly by General Zia and a new phase of cornering the wealth of the nation by a few hundred was launched. He and other left-of-centre writers like to glorify the Bhutto regime – why else would anyone call the six years of economic ruin and destruction “a levelling phase”? I recently spent some ...

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