Global Food Security Index 2021: Food in Pakistan More Affordable Than India, Bangladesh, Nepal

[Riaz Haq]

Food is more affordable in Pakistan than in Bangladesh and India, according to the Global Food Security Index 2021. Earlier in 2021, Global Hunger Index report also ranked Pakistan better than India. Numbeo Grocery Index reports that the food prices in Pakistan are the second cheapest in the world. 

Global Food Security Index 2021. Source: Economist

Global Food Security:

Pakistan (with 52.6 points) has scored better than  Bangladesh (48.8), Nepal (48.3) and India (50.2 points) in terms of food affordability.  Sri Lanka scored higher with 62.9 points in this category on the GFS Index 2021,  according to a global report released by Economist Impact and Corteva Agriscience recently. 

Ireland, Australia, the UK, Finland, Switzerland, the Netherlands, Canada, Japan, France and the US shared the top rank with the overall GFS scores in the range of 77.8 and 80 points on the index. 

In overall food security, Pakistan ranked 75th with a score of 54.7, ahead of Sri Lanka (77), Nepal (79) and Bangladesh (84), but behind India ranked 71st with a score of 57.2 points on the GFS Index 2021 ranking 113 countries.

Pakistan improved its GFS score by 9 points (to 54.7 in 2021 from 45.7 in 2012) while India’s score improved only by 2.7 points to 57.2 in 2021 from 54.5 in 2012.  Nepal improved by 7 points (to 53.7 points in 2021 from 46.7 points in 2012) and Bangladesh by 4.7 points (to 49.1 in 2021 from 44.4 points in 2012). China’s score improved by 9.6 points to 71.3 in 2021 from 61.7 in 2012, the report said. “The GFSI looks beyond hunger to identify the underlying factors affecting food insecurity around the world,” said Tim Glenn, Executive Vice-President and Chief Commercial Officer, Corteva Agriscience.

The cost of living in Pakistan is the world's lowest despite recent inflationary trends, according to the Cost of Living Index for mid-2021 as published by Numbeo.  Numbeo Grocery Index reports that the food prices in Pakistan are the second cheapest in the world. 

History of Inflation in Pakistan. Source: Statista

Global Hunger Index:

Global Hunger Index 2021 report has ranked Pakistan 92nd, ahead of India ranked 101st among 116 countries.  Pakistan's other South Asian  neighbors are ranked better: Nepal (76), Bangladesh (76), Myanmar (71). 

Hunger Trends in South Asia. Source: Global Hunger Index

Pakistan has been reducing hunger at a faster rate than India but slower than other South Asian neighbors like Bangladesh and Nepal. It is notable that Pakistan's minimum monthly wage of US$491 in terms of purchasing power parity is among the highest in developing nations in Asia Pacific, including Bangladesh, India, China and Vietnam, according to the International Labor Organization. 

Monthly Minimum Wages Comparison. Source: ILO

COVID-Induced Inflation: 

Global supply-chain disruptions and economic recovery from COVID19 pandemic have driven up prices of all commodities, including food and fuel, worldwide. 

Summary: 

Food and fuel prices in Pakistan are among the lowest in the world. However, everyone is feeling the pinch of rising global prices. It is particularly painful for people in developing countries like Pakistan. These prices are beyond the control of any one national government. What governments like Pakistan can and should do is to protect the poorest and most vulnerable people in their countries. Prime Minister Imran Khan's plan to deliver targeted food subsidies worth $700 million should help reduce the pain. This $700 million package of targeted subsidies is in addition to more than a billion dollars distributed to the indigent families under the Ehsaas program.  

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[Riaz Haq]

#India’s wholesale price-based #inflation (WPI) in October rose to 12.54% from the previous month's 10.66%, remaining in double-digits for the seventh month in a row, government data showed on Monday. | Reuters

https://www.reuters.com/world/india/indias-oct-wpi-inflation-accele...

India's annual wholesale price-based inflation, a proxy of producers' prices, accelerated in October to a five-month high, pushed up by increases in fuel and manufacturing prices, fuelling concerns of rising inflationary pressures for firms.

The gap between retail and wholesale price-based inflation has widened in recent months as many companies and retailers are still trying to absorb galloping input costs that threaten to hit their bottom lines.



Annual wholesale price-based inflation (INWPI=ECI) in October rose to 12.54% from the previous month's 10.66%, remaining in double-digits for the seventh month in a row, government data showed on Monday.

Consumer prices based inflation, the main gauge monitored by the monetary policy committee of Reserve Bank of India, rose 4.48% in October from the same month last year, speeding up from September's 4.35%, separate data released on Friday showed.



Economists said the recent cut in fuel tax rates by the government could lower pressures on households and companies in the short-term, but firms are trying to pass on rising costs as domestic demand picks up.

In the April-June quarter, the economy grew an annual 20.1%, and the central bank expects GDP to expand 9.5% in the current fiscal year ending in March 2022.



Wholesale fuel and power prices rose 37.18% in October year-on-year compared with 24.81% in September, while manufactured product prices rose 12.04% compared with 11.41% in the previous month, data showed.

Wholesale prices of food accelerated at a 3.06% pace in October from a year earlier compared with 1.14% in the previous month.

The RBI's monetary policy committee is scheduled to meet Dec. 6-8 and is widely expected to leave the repo rate unchanged at 4%.

[Riaz Haq]

'High inflation: no room for excuses': MoF clarification - Pakistan - Business Recorder



https://www.brecorder.com/news/40133523


Average core inflation during PTI first three years has recorded at 6.9% vs headline inflation 8.8%. If we compare with PML (N)'s average core inflation (6.0%) it was much higher than headline inflation (4.82%). This indicates that the competitiveness during PMLN was compromised as reflected from higher trade deficits due to contraction in export growth (2014-18).

While PPP stand out in headline, core and food inflation with record double digit witnessed in all categories- Headline inflation (13.82%), Core (11.4%), and Food (15.48%). Food inflation in PTI term is question marked and perhaps the only factor which is eating up the PTI political capital in last three years.

Logically, speaking the food price hike is linked with country's food security; PMLN has destroyed the country's comparative advantage of being agricultural country, through serving its vested interests. It is pertinent to note that average agriculture growth (2.18%) during PMLN were lowest since 1990s and even worst when we just focus on crop growth statistics (0.68%).

Agriculture crop growth recorded lowest in PMLN term- Average 0.68%, PPP 1.33% & PTI 1.76%. Despite the locust attack, the PTI government has successfully turned around the crop sector through incentivizing the farmers via attractive support prices, cheaper inputs, and timely payment of crops. Moreover, the focus has further sharpened by issuing the Kissan cards and loans to farmers.

Going forward, we are expecting bumper Kharif crops, and this will add huge sum to rural economy, never seen in last 13 years. Below is the crops target for FY22 and from where PTI took over.

Similarly, PTI government has been wrongly blamed for crisis in the energy sector. Under its belt, it has the credit to negotiate the IPP deals of 1994 & 2002 policies. This has saved hundreds of billion rupees. Despite Covid, Government has managed to bring the circular debt in FY21 to just Rs130 bn from more than Rs 450bn. Currently, the bigger issue for country is going through the excess capacity committed by PML-N government on 'Take or Pay' basis.

This has accumulated the huge capacity payments and in turn circular debt. Number of measures is already in place to improve the electricity consumption, but one cannot avoid the higher tariff to mitigate the looming power crisis.

We are confident of dealing with the structural deficit of the country, but it requires the exogenous crisis to stem first. Not to forget, we had to deal with default risk, higher deficits, threat from India, Covid, and off late Afghan issue and global inflation woes just in last 36 months, but even then, we manage to bring growth back on track.

Lastly, to protect the vulnerable, a relief package of Rs. 120 billion is announced to provide 30 percent discount on ghee, flour, and pulses to 130 million people for next six months. This is over and above of budgetary allocation for FY 2021-22 for EHSAS Program of Rs. 260 billion.

[Riaz Haq]

2020 labor force participation rate in Pakistan is 50.2%, higher than India's 46.3% but lower than Bangladesh's 55.7%.

https://www.ceicdata.com/en/indicator/india/labour-force-participat...


https://www.macrotrends.net/countries/PAK/pakistan/labor-force-part...


https://www.macrotrends.net/countries/IND/india/labor-force-partici...

[Riaz Haq]

How happy or miserable are we? - Newspaper - DAWN.COM
Inbox

https://www.dawn.com/news/1657633

The simple misery index has been modified by other economists like Robert Barro of Harvard and recently by Steve Hanke of Johns Hopkins Univer­sity. In Hanke’s formulation lending rates are added because higher lending rates cause misery. Growth in real per capita GDP is subtracted as it causes happiness. This formulation helps make a country by country comparison easier. Hanke has calculated this index for 156 countries for 2020 and ranked these countries from the most to the least miserable.

Venezuela ranks first (most miserable) and its neighbour, Guyana ranks 156 (least miserable or most happy). Why was Guyana most happy in 2020? It struck oil in 2019 and as a result, real GDP per ca­­pita increased by 25.8pc in 2020. Next to Vene­zue­­la in misery are Zimbabwe and Sudan. And next to Gu­­yana in happiness are Taiwan and Qatar. As we are always obsessed with comparisons with India, it may not hurt us to know that India is higher in misery (in­­dex 35.8, rank 39) than Pakistan (index 32.5, rank 49.) Bangladesh is better than both India and Pakis­tan with a misery index of 14 and rank of 129.

[Riaz Haq]

Budget 2021-22: Minimum wage increased from Rs17,500 to Rs20,000
Salaries and pensions increased by 10%

https://www.samaa.tv/money/2021/06/budget-2021-22-minimum-wage-incr...

The government has increased the minimum wage from Rs17,500 per month to Rs. 20,000.

Federal Finance Minister Shaukat Tarin on Friday presented the budget for the next financial year 2021-22.

Introducing the budget, the Finance Minister said that low-income earners have been affected more by inflation. In order to reduce the burden of inflation, the minimum wage has been increased from Rs. 17,500 to Rs20,000 per month.

The finance minister said that the salaries of government employees are being increased by 10% and the pensions of retired employees will be increased by 10% from July 1.

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In purchasing power parity terms, one PPP US$ is equal to about PKR 40.

So Rs 20,000 per month minimum wage translates to $500 in PPP terms.

[Riaz Haq]

Budget 2021-22: Minimum wage increased from Rs17,500 to Rs20,000
Salaries and pensions increased by 10%

https://www.samaa.tv/money/2021/06/budget-2021-22-minimum-wage-incr...

The government has increased the minimum wage from Rs17,500 per month to Rs. 20,000.

Federal Finance Minister Shaukat Tarin on Friday presented the budget for the next financial year 2021-22.

Introducing the budget, the Finance Minister said that low-income earners have been affected more by inflation. In order to reduce the burden of inflation, the minimum wage has been increased from Rs. 17,500 to Rs20,000 per month.

The finance minister said that the salaries of government employees are being increased by 10% and the pensions of retired employees will be increased by 10% from July 1.

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In purchasing power parity terms, one PPP US$ is equal to about PKR 40.

So Rs 20,000 per month minimum wage translates to $500 in PPP terms.