Food businesses feeling the pinch of rising inflation.

• Author: Nisar, Ahsan

Byline: Ahsan Nisar

Eating out is a great privilege and perhaps one of the only available forms of entertainment available in Pakistan. Various options are available in the form of food festivals, pop-up restaurants, home-based food businesses, road side cafes and 'dhabas' etc. which shows that the food culture is thriving. With the devaluation of Pak Rupee, purchasing power has seriously been affected due to high inflation and stagnant wages. This, in turn, may directly affect the food business if it has not been affected already.

In a bid to reduce food imports and boost local industry, the government has imposed sizable duty on imported goods and has also amended the import policies according to which the ingredients must be clearly mentioned on imported items and should be accompanied with a Halal certificate. As a result of this, many restaurants that rely heavily on imported food items are finding it hard to operate under the new tax regime. From importer to consumer, the entire food chain has been affected. Prices have gone up considerably which is hurting the food culture.

Restaurant owners are of the opinion that since Pakistan's agriculture industry lacks the variety and quality of food, hence the ingredients served in international cuisines could not be replaced with local ingredients. The import duties may be beneficial for Pakistan in the long run but in the short term they are proving to be detrimental for food businesses. The basic idea behind it is to replace imports with local substitution but the task may not be easy.

In the wake of import laws and inflation, food businesses are surviving, some by raising their prices while others have taken a hit on their margins. There...