Price hike in Ramazan: Hoarding, extortion in the time of fasting
“In Karachi, there are 1,140 small and big markets from where extortionists are collecting billions of rupees in bhatta, especially in Ramazan. Then how is it possible for shopkeepers to sell commodities at fixed and lower prices?” asked the president of Sindh Tajir Ittehad Jamil Ahmed Paracha.
He also admitted that in comparison to last Ramazan, most of the essential items are being sold at double the rates. “The prices of pulses, vegetables, fruits touched the sky and I blame our government for not taking action (against extortionists),” he commented.
“Shopkeepers are compelled to increase their prices because they get commodities at a high rate at the wholesale markets, while they all pay extortion money to political groups and the bhatta mafia,” explained Paracha. “And there is no government protection or any preventive mechanism in place.”
In order to provide some sort of relief to people, the district administration set up Bachat Bazaars during Ramazan. However, the bazaars failed at providing any reprieve from the sky-high inflation as commodities were overpriced.
In Karachi, prices of chickpeas increased from Rs100 (before Ramazan) to 140 per kg, the rate of tomatoes increased from Rs20 to Rs30 per kg, and the price of mangoes spiked from Rs100 to Rs150 per kg.
Even though there were complaints of the government not doing much in Karachi to keep the soaring prices in check, but in Lahore, the district government has somehow managed to keep the rates of several food items in Ramazan Bazaars under control.
According to district government officials, they have arrested 721 people for overcharging from June 29 and have imposed fines of Rs3.32 million. The government is also monitoring Badami Bagh Market where rates of vegetables and fruits are determined daily through auction.
In Lahore, the price of milk and yogurt, which had been set at Rs60 and Rs65, is being sold at Rs80 and Rs85, respectively.
Overall, in the Punjab capital, there has been an increase of 10%-20% in prices of food items.
Kashif Ali, a resident of Model Town who gets his groceries from a Ramazan Bazaar, said the government had largely succeeded in keeping the prices of food items under control. However, he added that the fruits and vegetables available were not of good quality.
Meanwhile, Abbas Nazir, a resident of Lahore’s Nawakot neighbourhood, said now fruit is out of his reach because of the price hike during Ramazan.
Like Karachi, but without extortion, the twin cities of Islamabad and Rawalpindi also have no regulatory system in place to check the soaring prices of food items in Ramazan.
Prices fluctuate and differ greatly from what the government has announced.
Talking to The Express Tribune, Traders Action Committee President Kashif Chaudhry said every year in Ramazan, prices of essential food items go up. “It is because of the absence of a proper mechanism or a plan to regulate prices of essential food items during the holy month. The government should formulate a policy at the national level to keep a balance between the supply and demand of food.”
The same complaint of cheaper but substandard food echoed in the federal capital as well.
But in Peshawar, despite three new subsidized markets in the city, people do not show up as there is hardly any difference in prices and many essential items are not available there.
“Raids and arrests of shopkeepers for a few hours will not keep the prices under control,” Sajjid Hussain told The Express Tribune, while he was shopping in one Utility Store.
However, Peshawar’s deputy commissioner Zahirul Islam assured, “There are 10 magistrates and six food inspectors working in the city to keep an eye on the people.”
Published in The Express Tribune, July 14th, 2014.
COMMENTS (4)
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Not sure where I am going wrong in understanding the title of the story. Thought of posing a question to the readers.
Why should prices of food items go up in the time of fasting? In fact, it should be the other way. When most of you fast, demand for food items goes down. So, we should actually see a sale/discounts. This whole thing about price hiking, hoarding during the time of fasting is a bit counterintuitive to me.
Do you by any chance eat more during this fasting time? Question sounds funny even to me, though.
Unless vegetable growers, sellers etc are allowed to implement a free market price you are always going to have a really bad system in place. Government meddling in prices makes it impossible for farmers of chicken, meat or vegetables to make a profit. So what happens is they start to mix, just like milk. Supply and demand is what makes prices. If you want quality produce and even better organic quality produce than farmers need a fare price. If farmers don't get that and shops cannot make a profit you will end up with rubbish. And worse still you will end up with farmers trying to produce crops with heavily laden chemical fertilizers and dangerous amounts of pesticides. If any one is at fault its the government for fixing prices and worse still for printing money which in turn causes huge inflation. So before you go blaming the farmers or shop keeper, there not at fault. After all how would you like it if they told you how much to sell your stuff for, cars, houses, furniture etc???
Pakistanis have a very poor understanding of the concept of supply and demand, shopkeepers are responding to the increase in demand by hiking prices.The issue is further compounded by the fact that Pakistan has a very poor supply chain management infrastructure from logistics to storage.
Price hikes during special events is nothing, the price of lambs jumps in the West during Easter, Turkeys during Thanksgiving, and Chocolates,clothing,hotels,toys during Christmas.
A case of make hay while the sun shines .