Food exports doubled last month, an astronomical rise at a time of crippling inflation that exposes the absence of holistic planning skills in policymakers. This is illustrated even more by the fact that food prices rose by almost 29% in the same month. Although the government would claim that rupee devaluation was to blame for the increase in export value, this is only partly true. While the rupee did fall significantly over the past year, news reports say export quantities also rose. This means the government chose to allow the local supplies to fall, which in turn increased local prices.
Compare this with India, which gave up billions of dollars by blocking almost all rice exports after a bad crop last year had reduced supplies and increased domestic prices. Incidentally, India’s rice export ban has led to higher demand for Pakistani rice — exports are up 77% in the current fiscal year so far. Meanwhile, meat exports continue rising despite domestic prices doubling over the past two years. Instead of focusing on controlling domestic prices, the government was again more interested in filling the vacuum created by falling Indian exports — India is a major meat exporter, but producers and exporters face domestic pressure from local cow protection activists and vigilantes.
It is also worth noting that, according to the UN’s Food and Agriculture Organisation, global food prices actually fell 10% in 2023, rubbishing efforts to blame international prices for rising domestic prices. Flawed policymaking and profiteering were always to blame. The desire for dollars led down a rabbit hole that has caused the kind of inflation we see today. It is high time for policymakers to deemphasise food exports in favour of ensuring domestic food security and price stability first, learning from responsible planners in other countries. Exports can be justified at times of surplus to regulate prices, but until the nation is food secure, using food to earn export revenue is a self-defeating policy.
Published in The Express Tribune, January 25th, 2024.
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