Exports-induced price hike

The export of raw food items has significantly increased during the current fiscal year. According to data from the Pakistan Bureau of Statistics, the value of raw food exports climbed to $1.01 billion in July and August, up from $710.65 million during the same months last year. Countries seeking high-quality grains and fresh produce often offer lucrative prices that incentivise local farmers and traders to prioritise exports over local sales. While this boosts foreign exchange and supports the agricultural sector, it also creates a supply crunch at home. As farmers shift their focus to lucrative export contracts, local markets face reduced availability of essential food items, leading to increased prices. Consequently, consumers face higher food prices due to supply and demand imbalances. Despite experiencing the highest food inflation in history, Pakistan's raw food exports have increased for the past many months.

The government's policy framework has inadvertently exacerbated this situation. Export incentives and subsidies for farmers have not been matched with adequate measures to ensure food security for the domestic population. This imbalance raises critical questions about prioritising foreign profits over local welfare. The rise in food prices disproportionately affects lower-income households, which spend a significant portion of their income on food. As prices soar, families are forced to cut back on nutritious options, leading to poor dietary choices and, ultimately, health issues. The government must address this imbalance by implementing regulations that protect local consumers and ensure that essential food items remain affordable. While the export of raw food items is undoubtedly beneficial for Pakistan's economy, it is crucial to balance this with the needs of local consumers. A concerted effort is needed to ensure that the benefits of agricultural exports do not come at the expense of the very people who cultivate these resources.