Video Producer: Akanksha Pandey
Video Editors: Prajjwal Kumar, Rajbir Singh
As Pakistan reels from a years-long economic crisis, a food crisis has now hit the nation. With prices of food items, wheat, and essentials soaring, videos of Pakistanis fighting over food, standing in long lines, running after trucks, and snatching bags of wheat from each other have gone viral.
Amid deepening crisis, Pakistan’s Prime Minister Shehbaz Sharif, at the International Conference on Climate Resilient Pakistan (ICCRP) held in Geneva on 9 January 2023, made a plea for help. In the presence of United Nations Secretary General Antonio Guterres, Sharif sought help from friendly nations and international aid groups.
But why is this happening?
The devastating floods that Pakistan saw in 2022 led to an estimated loss of $3 billion, death of 1700 people, and displaced nearly 8 million people. The calamity worsened the already declining economy of Pakistan.
In light of the floods, Pakistan had received an Extended Fund Facility (EFF) from the International Monetary Fund (IMF), however, due to their failure to fulfil their economic promises and the Pakistani government’s unwillingness to meet the IMF’s demands, IMF refused to release all of the pending payment.
In a report in September 2022, the IMF had also warned that high food and fuel prices could prompt social protest and instability in the country.
Depleting Forex Reserves
Pakistan’s Foreign Exchange Reserves have depleted drastically. According to data released by Pakistan’s central bank, State Bank of Pakistan (SBP), the country’s foreign exchange reserves are at an 8-year low.
With a massive spike in the prices of food products and essential items, Pakistan’s inflation rate is currently at 24.5 percent, as of December 2022, according to Pakistan Bureau of Statistics (PBS). The price of wheat has increased by 57 percent, and the price of onions has seen a 415 percent rise.
Excess Energy Consumption
Pakistan has seen an excess in its energy consumption. To conserve energy, Pakistan’s Defence Minister Khawaja Asif has ordered all shopping centres to close at 8 PM, and marriage halls and restaurants to close at 10 PM. He has also asked 20 percent of government employees to work from home.
Pakistan’s Information Minister, Marriyum Aurangzeb, on 9 January 2023, said that many donors had committed to give over $8 billion to help Pakistan recover from the devastating floods.