Rising inflation in Pakistan pushes families into debt cycle, asset sale
Sep 18, 2023
Karachi [Pakistan], September 18 : As Pakistan grapples with a severe economic crisis and soaring inflation, this financial safety net of the people of Pakistan appears eroding, Dawn reported.
Children who were given lessons about "saving for a rainy day" from a young age. These savings, whether in cash or assets like gold, were traditionally reserved for significant expenses such as weddings, unexpected illnesses, or business losses but families are finding themselves compelled to dip into their savings to cover daily necessities, including electricity bills, school fees, rent, and other essential expenses, Dawn reported.
For instance, Zubaida Bibi, a widow living in Taxila's Bilal Colony, had to pawn her three-decade-old engagement ring to pay her August electricity bill, hoping to retrieve it once her pension funds became available.
Ahmed Zaman, a resident of Karachi and the sole provider for his family of six, revealed that his Pakistan Rupee (PKR)150,000 monthly salary, which once covered household expenses, is now insufficient. He shared the struggle of managing his PKR 35,000 rent and a monthly electricity bill exceeding PKR 40,000, with these two expenses devouring half his income.
Even families with multiple earners face financial hardship. Hussain Shabbir, residing in Pakistan's largest city, Karachi, explained how three of his family's seven members contribute to the household income. Despite their combined earnings of around PKR 130,000, they've resorted to borrowing money from friends as they grapple with a mounting "debt cycle," according to Dawn.
Ehsan Ali, who owns a poultry shop in Taxila, witnessed his sales plummet to nearly 60 per cent of their previous levels. Customers, burdened by rising poultry prices due to inflation, now opt for cheaper cuts like pota, kaleji, and chicken legs.
Aftab Hussain, a hotel owner in Taxila Chowk, also experienced a significant drop in income. His customers, mostly vendors, drivers, and daily wage earners, have shifted to ordering smaller portions, such as half-cup teas, due to cost concerns. Even meat dishes like qeema, qorma, and beef have seen an 80 per cent decline in consumption, with people favouring cheaper alternatives like vegetables and lentils.
These shifts in lifestyle extend beyond trimming basic expenses, as people are forced to downgrade their choices in food, housing, transportation, and even their children's education, Dawn reported.
