LAHORE: Commodities price hike, price fluctuation, particularly wheat and vegetables have caused havoc among the common man and have also disturbed the businesses outflows and have caused a reduction in sales.
To understand the inflation phenomenon, considering structural flaws and market mechanisms is a must to ensure a steady market price.
These were the views of the President of the Lahore Chamber of commerce and Industry Mian Tariq Misbah, Senior Vice President Nasir Hameed Khan, and Vice President Tahir Manzoor Chaudhry while speaking about the recent price hike of essential commodities and other household products.
The LCCI office-bearers said the recent surge in inflation to 9.0 percent in September 2020 as compared to 8.2 percent in August 2020 has increased the cost of doing business as well, adding since inflation is caused by an imbalance between supply and demand; in our view, the best strategy to reduce inflationary pressures is the domestic supply expansion. Long-term economic growth is based on Domestic Supply Expansion, Industrialization, and Export Growth, the added.
They said that in order to curb the food inflation which currently stands at 14.74 percent in September 2020, LCCI recommends the following measures.
Increasing the efficiency and effectiveness of the regulatory framework for monitoring of food prices at the district level by the Government of Punjab.
Subsidizing certain factions:
Subsidizing the input cost of farmers (especially fertilizers) in order to reduce the price of important crops.
Increased representation of the private sector in the price committees and other mechanisms of the provincial Government.
Ensuring timely imports of the essential food items on zero duties in the short run to stem this current wave of double-digit food inflation and stabilize the food prices. The reduction of import duties to zero percent on raw materials not manufactured locally can greatly help in controlling the Smuggling.
Measures against Profiteering:
Strict Measures should be taken against illegal profiteering and Hoarding by addressing the root causes WITHOUT raiding markets and creating an element of harassment among the businesses. The government must facilitate the private sector in a timely declaration of Goods through an effective mechanism.
The menace of smuggling should be tackled through effective Border Controls as it contributes to increasing inflation.