Islamabad, Aug 22: The utility stores corporation (USC) has been ordered by the federal government to stop providing subsidies for basic food goods. This has resulted in a sharp increase in the cost of basics such as rice, ghee, wheat, sugar, and legumes.
Critical financial relief has been denied to vulnerable people as a result of the sudden withdrawal of subsidies.
The utility retailers are on the list of businesses that will be privatized; however, a decision has not yet been taken about their future. Subsidies were previously given to people whose monthly income was less than Rs. 40,000. At a recent federal cabinet meeting, the decision to stop subsidies was decided.
A 10-kg bag of flour used to cost Rs. 648, but now costs Rs. 1,500. One kilogram of ghee used to cost Rs. 380, but now it costs Rs. 450.
The cost of rice went from Rs. 320 to Rs. 340, while the price of sugar went from Rs. 109 to Rs. 160 per kg. Significant price increases have also been observed for pulses; Daal Chana and Daal Moong are currently selling for Rs. 260 and Rs. 330 per kg, respectively, and white channa for Rs. 380/kg.
Consumers are already feeling the direct effects, as costs at USC are now almost the same as those in open market stores.
Along with a 1.25 percent turnover tax on the firm, the Economic Coordination Committee (ECC) recently approved a higher monthly subsidy rate for the USC per household.
