Inflation refers to price hike of important commodities of life like wheat, flour, milk, meat, medical services and other essential service of life etc.

It can also be understood that inflation means the decline in the value of money - when people have to spend more money to take the same services or products which they used to buy in lesser amount. Inflation affects the whole social fabric of society including economy of the country, production and political environment.

A good government is supposed to keep check and balance on the rise of inflation.

Inflation is not a new concept rather it is an old problem. It can be called a cancer for developing economies as it imposes high cost on economies and societies.

It becomes more dangerous for the poor and salaried people because they are less able to protect themselves against rising costs of life and couldn't stand against the risks that high inflation poses. Lowering inflation, therefore, directly benefits the low and fixed income groups.

In the last few months Inflation is on continuous rise. One of its major reasons is that in the last few months there is rise of petroleum products.

Every month starts with new and raised prices of the petroleum products and so is the month of March which began with increase of the prices upto Rs6 per litre.

This constant rise caused the rise of inflation. The State bank of Pakistan observed that people are complaining for the last several months that price-hike was making their lives miserable. It is becoming very difficult for a common man to make both ends meet.

The government is preparing to present next year financial budget as the general election is approaching.

But surprisingly, it is in constant state of denial and say that there is no rise in inflation. According to the government the price of common commodities are stable even though different institutions including the Federal Bureau of Statistics are claiming otherwise.

The SBP has warned that inflation is all time high in two years and war footing steps should be taken to address the worsening situation. Government claim about price stability is contradicted by sharp rise in prices of almost all items of daily use including wheat flour, pulses, edible oil and milk besides vegetables and fruit.

Rice in prices has also witnessed a quantum jump in the last few months. Industrialists and manufacturers including pharmaceutical companies have also increased prices of their products especially in the backdrop of rising prices of petroleum products whereas service providers too have increased their rates.

According to data released by the Pakistan Bureau of Statistics inflation has steadily been on the rise.

High inflation rates are regarded harmful to economy in many ways. During high inflation rates companies can't make budget or plan for long-term and it affects production. It hampers them their future planning and discourages the investors to invest. The other negative aspects inflation cause to increase hidden tax.

For example, inflated earnings push taxpayers into higher income tax rates unless the tax brackets are indexed to inflation. With high inflation, purchasing power is redistributed from those on fixed nominal incomes.

The State Bank has been very keen in listing almost all the factors which increases the inflation. The government should take the present situation seriously and should bring it down to a low level remedial measures should be taken as price hike is playing havoc with budget of the people in the absence of any corresponding increase in salaries and relief for the poor.

It can be controlled by limitation in unnecessary expenditures, increase in rate of taxes, increase in volume of savings and anti-inflationary budgetary policy.