Mohammad Rizwan, a vendor selling children and women’s clothing off a side street from the main Tariq Road in Pakistan’s biggest city, is currently ruing his sales figure during what traditionally has been a bumper holiday. This year, he and his fellow merchants are, however, disappointed, to say the least.
“A shopkeeper who used to sell Rs100,000 worth of clothes in a day prior to Eid is now only able to sell Rs25,000 worth of clothes,” Rizwan told Business Recorder.
“Almost everyone in this market is experiencing around one-fourth of the sales compared to previous years.”
High inflation badly hits Eid shopping
Atiq Mir, Chairman of All Karachi Tajir Ittehad, corroborated this trend, stating that Karachi is witnessing its lowest Eid season sales in years.
“In 2015, total Eid sales in Karachi were approximately Rs70 billion. This figure has gradually reduced every year since then. We estimate that it now stands at just Rs16-17 billion this year, the lowest since we started tracking Eid sales,” Mir explained.
He added that overall sales have dropped around 30%-40% this year compared to the previous year. “A family of five is choosing to buy a dress only for the youngest member of the family this year.”
Mir attributed this decline primarily to skyrocketing inflation, which has significantly reduced the purchasing power of the average household.
“I personally know families who haven’t had meat for six months. Life is becoming increasingly difficult,” he lamented.
Eid rush hits shopping malls; modest sales witnessed
When Mohammad Rizwan was asked about the large number of people in the market, he explained, “They are just out to enjoy, do some window shopping, and have a burger or cold drink. But not more than that.”
Pakistan’s economy has been on a rocky path, and even flirted with default fears in 2022-23. Concerns were raised on its debt profile with many onlookers stressing the desperate need for structural reforms.
However, a last-minute $3-billion bailout with the International Monetary Fund (IMF) not only helped avert a balance-of-payments crisis, but also took the economy on the path to a reforms’ agenda that saw it raise energy tariffs, and make attempts at privatising loss-making state-owned entities.
Still, average inflation for the first nine months of the ongoing fiscal year has stood valiantly at around 27%, and GDP growth has only clocked in at a mere 1% during the October-December quarter of 2023.
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