Finance Minister Muhammad Aurangzeb vowed on Sunday that the government would not allow traders to carry out artificial inflation and would take action against hoarding and arbitrage, as experts warn of a looming food supply chain disruptions caused by devastating floods in Pakistan’s Punjab province.
Floods in Pakistan’s Punjab, also referred to as the country’s breadbasket province, have wreaked havoc since late August, killing over 104 people and affecting more than 4.5 million people. Deluges have inundated thousands of fields of standing crops such as rice, sugarcane and vegetables.
Economists and traders have warned that the floods, which are now moving downstream toward the southern Sindh province, may elevate food and overall inflation in the coming months due to crop losses and supply chain disruptions. This has sparked fears of traders hoarding products to create an artificial shortage and selling them at inflated rates later.
“We [government] will not allow arbitrage to take place, hoarding to take place,” Aurangzeb told reporters during a visit to a flood relief camp in the eastern Toba Tek Singh city.
“Because this is wrong, there should not be artificial inflation. So, we are looking at both the structural level and the administrative level, and god willing, will continue to take administrative measures against the hoarders.”
The minister said that while a lot of the destruction was triggered by climate change effects in Pakistan, some of it was also “self-inflicted.”
“We also have to see where we have to keep the population, where we have to do farming, where we have to build our [housing] societies and what their zoning laws should be,” Aurangzeb said.
“I think it’s about time we also think about the self-inflicted pain.”
Aurangzeb said the government will assess the damages that the floods have inflicted on Pakistan’s economy within the next 10-15 days as floodwaters recede.
“And on that basis, we will proceed together with everyone on a comprehensive basis,” he said.