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To pull the economy out of stagflation, the simple solution may appear to be an increase in domestic production and the removal of supply constraints to meet the domestic demand for goods and services. That could possibly lead to a stabilisation of prices. In February, annualised food inflation shot up to 41.9 per cent in urban areas and 47pc in rural areas — a persistent trend along with growing unemployment resulting in a cost of living crisis. A sharp slowdown in economic activities is indicated by a 75pc plunge in bank credit to the private sector during the first eight months of this fiscal year. This has resulted in the retrenchment of industrial labour and a decline in export earnings. Foreign direct investment has simultaneously dropped by 88pc to $788 million, down from $1.315m in the same period of last fiscal year. At the same time, the distressed federal government is slashing its development spending. The economic growth rate is officially forecast to slow down to 2pc during FY23.