Thousands of shopkeepers across Pakistan closed their businesses on Saturday, embarking on a nationwide strike to voice their grievances over the relentless surge in energy and fuel costs. This widespread discontent has emerged as a pressing concern in the lead-up to national elections.
Pakistan’s economy, marred by decades of mismanagement and instability, reached a critical point this summer when Islamabad was compelled to strike a deal with the International Monetary Fund (IMF) in order to stave off a potential default. However, the IMF’s stipulation for reducing popular subsidies aimed at cushioning living expenses has led to a sharp increase in petrol and electricity prices.
Major cities like Lahore, Karachi, and Peshawar witnessed significant closures in their markets as traders joined the protest, adorning abandoned bazaars with placards denouncing “the unreasonable increase in electricity bills and taxes.”
Ajmal Hashmi, president of Lahore’s Township Traders Union, expressed the sentiment of many, saying, “Everyone is participating because the situation has become unbearable now. Some relief must be given so people can put food on the table.”
Traders wield substantial influence in Pakistan, and with national elections on the horizon, the government faces the challenging task of appeasing them while adhering to the IMF’s austerity measures.
Historically, Pakistan has struggled with low tax collections, including from traders, which has resulted in accumulating massive foreign debts that it struggles to repay. The IMF aims to break the cycle of repeated bailouts that have sustained the economy for decades.
Caretaker Prime Minister Anwaar-ul-Haq Kakar, in a press conference in Islamabad, emphasized that citizens would have to bear the burden of inflated bills, asserting that there is no “second option.” He argued, “When you subsidize, you shift your fiscal obligations to the future. Rather than addressing the issue, you just delay it.”
This week, the government raised petrol prices, crossing the 300 rupees ($1) per liter mark for the first time in the nation’s 76-year history. Simultaneously, new data revealed a year-on-year inflation rate of 27.4 percent in August, with motor fuel bills rising by eight percent compared to July.
Babar Mahmood, president of the Electronics Market Traders Union in Lahore, lamented, “The bills we have received this month exceed our earnings,” highlighting the growing divide between the general public and those in positions of power.
With Pakistan currently under the governance of a caretaker government following the dissolution of parliament last month, their primary responsibility is to facilitate upcoming elections. However, no official election date has been announced. The interim leadership, along with the terms of the IMF agreement, were negotiated by former Prime Minister Shehbaz Sharif, who led a fragile coalition striving to revitalize the economy after the ousting of Imran Khan in 2022.
Notably, Imran Khan, one of Pakistan’s most popular politicians, remains incarcerated, grappling with a series of legal cases that he claims are intended to prevent him from participating in the upcoming polls. Furthermore, Pakistan is contending with a deteriorating security situation, highlighted by a suicide attack on Thursday that claimed the lives of nine soldiers.
