In inflation-hit Pakistan, a 35% salary hike for state govt employees

In Pakistan, the common people have been battling shy high prices in recent years. Inflation has hovered around 30% in recent months. According to a report in Dawn website, the caretaker government in Punjab has cleared a 35 per cent increase in the salary of government officials in grades 1-16 and 30 per cent hike in salaries of grade 17-22 employees. The salary hike will be calculated on the basis on current basic salary. Pensioners, according to the report, will also get 17.5% hike in pensions after the caretaker government approved the increase.

Though Pakistan's headline inflation eased for the first time in seven months in June, the number hovered around the 30% mark. Year-on-year inflation was 29.4% last month, Pakistan Bureau of Statistics data showed, compared with a record 38% in May. Pakistan had to seek a bailout from the International Monetary Fund after tears of financial mismanagement have pushed its economy to the limit. The economic crisis has exacerbated due to the Covid pandemic, a global energy crisis and record floods that submerged a third of the country last year.

The World Bank in a recent report said that as of 2023, poverty in Pakistan is expected to reach 37.2%. Though the rate is slightly below the last observed measure in 2018, when it stood at 39.8%, accounting for population growth, there are almost 3 million more poor people in the country than in 2018, the report said.


"A difficult macroeconomic environment, a deteriorating labor market, lower remittances, quickly rising prices, and the impact of recent natural disasters have led to a decline in household incomes and further poverty reduction. In the absence of higher social spending, all these factors can reverse the poverty gains achieved in the last two decades and further reduce the incomes of already poor households," the World Bank said.