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From New Nation Online Edition Front Page The prices of almost all essential commodities have gone beyond the purchasing capacity of the commonman, seriously affecting the middle class and the teeming millions who live below the poverty line.
Economists have attributed domestic fuel oil price hike by the government and increased transportation cost for carrying goods from one place of the country to another behind the price hike of essential commodities. Prof Anu Muhammad of the Department of Economics of Jahangirnagar University, told The New Nation yesterday that prices of essentials increased in the markets abnormally as the supply of goods had gone down. "Essential prices have increased as there is no alternative mechanisms to supply goods from the grower's level to the retailer's level although the syndicate is not active now like the past," he said. The economist suggested that the government should have given thought on the implications of oil price hike on the country's economy and essentials' prices before taking any decision to raise fuel oil prices. "The government may save Tk 10 raising the prices of one litre of fuel oils, but it has impact worth Tk 100 on the people," he said. Prof Anu Muhammad also suggested the creation a new network for smooth supply of goods from the grower's level to the retailer's level. He also observed that the monetary policy adopted by the caretaker government at the prescription of International Monetary Fund would not bring any benefit for the country. Meanwhile, prices of the most of essentials, including rice, pulses, edible oils, baby food, fish and potato, have been increasing without any respite making the everyday life of the common people miserable. The prices of rice, edible oils, pulses and powdered milk have increased by about 25 to 30 per cent over a period of last one month. Even, the coarse rice, which is the staple food of more than 95 per cent of the people, has increased by Tk 4-6 in last four months. Country's economists observe that all the achievements of the present caretaker government may turn futile unless urgent steps are taken to check the price hike. The caretaker government is trying its best to bring down the prices but virtually without any effect. It has been selling rice under OMS operation in cities and towns at a reduced price and the Bangladesh Rifles has been operating makeshift retail outlets to sell some essential items at reasonable prices. These operations being very limited in nature have failed to produce any impact on the price situation. There is no denying fact that a section of unscrupulous and greedy importers and wholesale traders earned huge profits resorting to unholy practices in the absence of any government actions against them. The government held meetings with trade bodies in an attempt to bring down prices. But those did not help much. But there is no reason to believe that that so-called business syndicates are now having a freehand, particularly after so many raids by the army-led joint forces. Both external and internal factors are possibly responsible for the price hike. The prices of food grains, particularly rice and wheat, edible oils, pulses and powdered milk in the global market have recorded a substantial rise. Because of poor rice harvest, many food grains exporting countries have stopped export of the same. The major source of import of rice, wheat and lentil for Bangladesh has been neighbouring India. India has banned export of wheat and lentil and the domestic price of rice has also gone up substantially in that country. The production of boro rice this year might be lower than expected, mainly because of chita (paddy having no grain inside) problem in various parts of the country. The wholesale rice traders are expecting a slight fall in rice prices within a couple of weeks following the arrival new boro rice in the market. But such a downtrend could be short-lived. In a free market economy, the choice is very limited for a government so far as controlling market prices is concerned. The measure that is considered most effective - duty reduction - in case of price rise has been enforced. It has also gone for market intervention, in a very limited scale. The government does not have the capacity to intervene in the market in a big way. But, in spite of all the limitations, the government has to explore all possible means to rein in prices of essentials, for the sake of the poor and low income people. These people are an unhappy lot since they are finding it hard to cope with the price situation. The administration needs to be very careful about the prices of rice in the coming days. So, the domestic stock of rice might not be that healthy before the next Aman harvest. The prices fixed by the government for the procurement of boro rice does appear to be unrealistic. With this price, its procurement programme is unlikely to be successful. And if it happens, there should be every reason for the government to be worried since it has already exhausted a large part of its stock of rice through OMS operation. © Copyright 2003 by ittefaq.com |
