Inflation Jumps To Record 37.97% In Crisis-Hit Pakistan

Troubles continued to mount for an embattled Pakistan today, with official data revealing a rise in its annual inflation to a record 37.97 per cent in May. Pakistan's figure is the highest in South Asia, ahead of Sri Lanka, whose annual inflation stood at 25.2% in May

Data released by the Bureau of Statistics showed that alcoholic beverages and tobacco witnessed the highest year-on-year increase of 123.96 per cent, followed by recreation and culture at 72.17 per cent and transport at 52.92 per cent. The cost of non-perishable foods also rose by over 50%

The skyrocketing inflation in Pakistan comes in the backdrop of a major economic crisis caused by a slew of factors including high external debt, a weak currency and dwindling foreign exchange reserves. A global energy crisis and devastating floods that submerged a third of the country in 2022 have also contributed to the crisis.

Adding to the country's challenges is a political crisis, with former prime minister Imran Khan's brief arrest in April leading to deadly street violence. The inflation numbers also come a week before Prime Minister Shehbaz Sharif's government is scheduled to present its annual budget.

Among food items, potatoes, wheat flour, tea, wheat and eggs and rice saw the highest price rise in May compared to last year. In the non-food category, textbooks, stationery, motor fuels, washing soaps, detergents and matchboxes were the items that saw the highest rise

"This level of inflation badly affects poor and middle-class families of the country, whose income is evaporating with each percentage point," AFP quoted Mohammad Sohail, a financier in Karachi, as saying.

The highest-ever year-on-year inflation recorded in Pakistan before this was 36.4 per cent in April. With the fresh increase in the Consumer Price Index, average inflation stood at 29.16 per cent in 11 months (July to May) this fiscal against 11.29 per cent in the previous year.