Bangladesh

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Low, middle income groups in Bangladesh reel from rising prices

Shakhawat Hossain | Published: 00:00, Feb 23,2020 | Updated: 00:05, Feb 23,2020

 
 

Sufferings of the middle and low income groups are growing as the volatility in the prices of some half a dozen essential commodities, including rice, edible oil, pulse, sugar and garlic, on the back of the record price hike of onion has been persisting.

Economists and rights activists said that the unabated price hike of essentials in the absence of proper market monitoring and intervention was forcing the majority population to spend higher on food and less on other items like clothes, healthcare and education with their limited income.  

Moreover, the government decision of halving the interest rates in the postal saving schemes is like sprinkling ‘salt on the wound’ for many retired and aged citizens who depend heavily on the income from the schemes, they said.

Besides, power consumers across the country are worried over the coming electricity price hike intended to pass over the burden of the ‘capacity charge’ to the consumers—over Tk 8,000 crore was paid to the idle rental power plants alone in 2018-19—while the city dwellers are concerned over the move to raise water price by the Dhaka Wasa.

Consumers Association of Bangladesh general secretary Humayun Kabir Bhuiyan observed that sufferings of people were growing as the ministry of commerce failed to check the volatility in the prices of essentials.

Consumers belonging to the middle and lower income categories were finding the ‘going tough’ as the record onion price hike has changed the market situation for the worse for the last six months, he said.

Quoting a report by the Special Branch on the commodity market, commerce ministry officials said that the export ban by India in September last resulted in the record price of onion to Tk 220 to Tk 230 per kilogram from just Tk 40 on the local market.

Although one kilogram of onion is now selling at Tk 120 the Special Branch apprehends further onion price rise against the annual demand for 26 lakh tonnes of the commodity, including an import of 8-10 lakh tonnes.

The SB report said that rice prices had increased by Tk 2-3 per kilogram and pulse prices by Tk 10-15 at the retail level since early this month although there was no supply shortage of the items.

The price of garlic has  increased by Tk 40-50 per kilogram since the coronavirus outbreak in China, the supply source of at least 60 per cent of the country’s annual demand for the commodity.

The price of edible oil has gone up by Tk 8-10 per kilogram and the price of sugar by Tk 3-4 since early this month, according to the report submitted to the commerce ministry on February 6.

Commerce minister Tipu Munshi while talking to New Age on Wednesday at the Secretariat said that he did not mind with the rice price hike if the benefit went to the growers.

But, he said, if the benefit has gone to the middlemen it was bad.

He said that they were procuring more essential commodities to keep the market stable.

On Wednesday, the government decided to procure 25,000 tonnes of sugar and 30,000 tonnes of edible oil for the open-market-sale programme during Ramadan, the Muslim month of fasting, by state-owned Trading Corporation of Bangladesh.

The purchases are part of the government precautionary steps to check any supply disruption during Ramadan, said finance minister AHM Mustafa Kamal after giving approval to the purchases at the cabinet committee on national purchases.

The CAB general secretary said that there was no reason for the onion price rise as the item available now in the market was imported much before the coronavirus outbreak and the new years’ vacation in China that caused a suspension of the trades with China.

But no visible steps were seen to check the unethical practice by traders, he said.

In its annual report released in January, Consumers Association of Bangladesh said that the cost of living in the country’s capital increased by 6.5 per cent in 2019 compared to 6 per cent in 2018.

Bangladesh Institute of Development Studies director general Khan Ahmed Sayeed Murshid said that the rise in prices of rice and others essential was always sensitive since poor people spend up to 50 per cent of their daily income on food.

In October 2019, the World Bank in its report ‘Bangladesh Poverty Assessment’ projected that more than half the country’s population was vulnerable to poverty since their consumptions were close to the poverty threshold of $1.9.

Many face risks of being relegated down the poverty line, said executive director Ahsan H Mansur of Policy Research Institute.

Transparency International Bangladesh said that the proposed increase in the price of water supplied by the Dhaka Wasa was unreasonable and would burden the low and fixed income groups.

TIB executive director Iftekharuzzaman said that the Wasa should make up the growing operational cost and payment obligation of its debt taken for development projects through improving its efficiency and tackling corruption.

People should not be penalised for its inefficiency, he observed.

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