Karachi: The Fourth Cheapest City in the World – An Affordable Paradise for Residents and Tourists

If you are a tourist, it will be interesting for you to know which city in the world is the cheapest to stay. The British Magazine “The Economist” has been publishing a list of the cheapest and most expensive cities in the world almost every year for a long time.

According to the Economist Intelligence Unit (EIU), Karachi is the only city in Pakistan that falls in the top ten cheapest cities in the world. As cited by the Economist Intelligence Unit’s Worldwide Cost of Living Survey 2023, Karachi secured the fourth position as the least expensive city to reside in. The survey, conducted by the EIU, a sibling entity of The Economist, revealed that Karachi held the 170th score out of 173 cities, surpassing Tripoli, Tehran, and Damascus in a comparative analysis of living costs.

The biannual findings involved a comprehensive assessment of over 400 individual prices for 200 different products and services in each location. Additionally, the survey investigated factors like currency fluctuations, local inflation, and commodity shocks, examining both current and historical trends influencing the cost of living.

Karachi, the capital of the Pakistani province of Sindh, stands as the most populous city in the country and ranks as the fifth-most-populous city globally. As a local and international economic hub, Karachi claims two major seaports and an international airport, contributing significantly to Pakistan’s economy.

Despite its economic significance, Karachi is often regarded as “the cheapest city in the world.” The cost of living varies depending on the neighborhood and the lifestyle one can afford. Karachi’s affordability is attributed to several factors, such as advantageous exchange rates, budget-friendly housing options, and convenient transportation. Many reports suggest that groceries, utilities, and clothing are notably inexpensive, enabling residents to make their budgets go a long way.

Remarkably, despite its cost-effectiveness, Karachi features a diverse culinary landscape, spanning from street food stalls to upscale dining establishments. The city also offers a rich cultural experience with historical landmarks, vibrant bazaars, and lively festivals, providing ample opportunities for entertainment and exploration.

Karachi, with its population exceeding 17 million, has consistently held its position among the top 10 cheapest cities globally for the past decade, occasionally even claiming the title of the cheapest city.

EIU report emphasizes that while South Asian and specific Middle Eastern cities traditionally provide the best value for money, especially by Western standards, the correlation between affordability and livability is not always positive. In simpler terms, cheaper cities often tend to be less livable, as highlighted in the report.

Dr. Hasan Khan, an expert in economic affairs, while talking to EAT News, said that this seaside city is also known as a poor-loving city, people from all over the country go to Karachi for employment and this city nurtures them like a mother.

Economic affairs analyst Dr. Samiullah Farooqi told EAT News that the IEU report is correct. Karachi is a cheap city compared to the big cities of the world. He said that one of the reasons for this is the falling value of the rupee (PKR). The exchange rate of the dollar and other currencies is high. He said that even though the tax system in Karachi has not improved, housing in this city is cheaper than in other cities.

Analyst Rehan Baloch while talking to EAT News said, “It is true that commodities and utility items are cheaper in Karachi; this city welcomes everyone wholeheartedly, and if someone has limited resources in his hand, even then he can survive in Karachi.”

According to senior journalist Mr. Shakeel Rehman, Karachi has a special status of its own. There are numerous markets in this city, and people from all over the country visit this city for shopping. This city with ports provides convenience to the buyers, they can buy a variety of things at cheaper rates. He said that there are many options to buy anything in terms of quality in Karachi; the markets could also be ranked as posh areas, middle-class, and lower middle-class

Earlier this year, Karachi was designated as the fifth least livable city, as per The Livability Index 2023 published by the Economist Intelligence Unit (EIU). In this ranking of 173 countries, Karachi secured the 169th position, surpassing Lagos, Nigeria, Algiers, and Tripoli. The index assessed living conditions based on various factors, including healthcare, culture, environment, education, and infrastructure.

Karachi’s overall index tallied up to 42.5, falling short of half the necessary living standards. The breakdown reveals a score of 75 for education, 50 for healthcare, and 51.8 for infrastructure. In contrast, culture and environment received a modest 38.7, while stability lagged at a mere 20.

The survey, as outlined in the report, aimed to assist companies in determining hardship allowances for employees relocating to a new city. Additionally, it offers an index ranking cities based on their desirability for living. According to the survey, cities in the Asia-Pacific region have shown the most significant recovery from the pandemic. The index also indicates an overall improvement in the quality of life in cities compared to the past 15 years.