In­fla­tion­ary pres­sure

The Pak Banker - - 4editorial -

Econ­omy of the Pak­istan is suf­fer­ing a lot since few years and fac­ing the dif­fer­ent chal­lenges. In past few years it has un­der­gone sig­nif­i­cant changes. The biggest worry of the all that is a core prob­lem is in­fla­tion­ary spi­ral. Govern­ment should be in search of find­ing its root cause and the de­ter­mi­nants of in­fla­tion. There are a lot of rea­sons that are con­tribut­ing to­wards the rise in the rate of in­fla­tion. First of all, in­fla­tion can oc­cur when the govern­ment prints a greater amount of money to have con­trol over the cri­sis go­ing on in the coun­try. When ex­cess of money is cre­ated; it gives rise to the procur­ing power of some so­ci­etal groups. Se­condly, in­fla­tion takes place when the cost of pro­duc­tion in­creases. Even a small rise in the pro­duc­tion cost di­rects to an in­crease in the price of fin­ish­ing man­u­fac­tured goods. In­fla­tion can also be based on the fed­eral taxes that are ap­plied on con­sumer prod­ucts. As the rate of tax in­creases, sell­ers of­ten trans­fer the load on to the con­sumer. The catch, on the other hand, is that if the price of prod­ucts in­creases, they hardly come back to nor­mal. More com­mon fac­tors that are lead­ing our coun­try to­wards in­fla­tion are; less job op­por­tu­ni­ties, loans from "IMF" and World Bank, de­struc­tion wrought by floods - loss of crops and an­i­mals etc - and load­shed­ding. Be­cause of all the is­sues men­tioned above, the in­dus­tries fail to ful­fill the de­mands of in­di­vid­u­als which are di­rectly af­fect­ing the econ­omy of Pak­istan. That is why prices are con­tin­u­ously in­creas­ing. So, to make the present con­di­tions bet­ter; our govern­ment should take an ini­tia­tive for the bet­ter­ment of econ­omy. Firstly they have to con­trol the scourge of load­shed­ding by mak­ing dams in­clud­ing Kal­abagh dam. By do­ing so, the to­tal pro­duc­tiv­ity of in­dus­tries will boost. Then, our politi­cians ought to re­duce their waste­ful ex­pen­di­ture and must pro­tect mid­dles classes from ex­treme tax­a­tion like RGST. Even this lit­tle con­tri­bu­tion by our govern­ment can work won­ders for the coun­try. Only then can we hope to be­come a de­vel­oped one. Pak­istan's govern­ment is not giv­ing heed to the peo­ple' prob­lems due to po­lit­i­cal com­pli­ca­tion in­side and out­side the par­lia­ment.

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