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Govt must save people from market manipulation woes

Published: 00:00, Sep 26,2020

 
 

A CONTINUED increase in prices of goods such as rice and edible oil over the past few days, in the wake of a sharp increase in onion prices two weeks ago, has put the poor and low-income people in a difficult situation. Prices of rice of fine varieties are reported to have gone up by Tk 1–3 a kilogram while prices of unpackaged soya bean oil and palm oil have increased by Tk 5–6 a litre in the past five days. Onion prices, which shot up to Tk 120 a kilogram from Tk 45 early September after India had banned onion export to Bangladesh, is reported to have decreased slightly but still remain high with the local variety selling for Tk 80–90 a kilogram and imported onions for Tk 80–85 a kilogram. With a surplus production of rice, more than 5.5 million tonnes estimated in excess after meeting the domestic demand when the aman harvest will have arrived in November–December, it is unacceptable that the traders seek to explain the price increase saying that there is a supply shortage. An increase in edible oil prices on grounds of price increase on the international market, as market experts say, also appear to be a ploy to maximise profits.

Rice prices went up earlier in June even though there was a bumper production of the boro crop, which grows in March–May, and have remained high since then. Experts say that rice prices have been unusually high as a group of profit-mongers have manipulated the rice market on the excuse of flooding, which, as experts find, should not impact the rice supply as there is enough rice in government and grower’s stock. In such a situation, a further increase in rice prices is certainly a burden, especially for the poor and the low- and fixed-income people, whose purchasing capacity has already decreased substantially because of the economic slowdown caused by the COVID-19 outbreak that has pushed about 40 per cent of the population below the poverty threshold. Market experts appear to be right when they blame the government for a lack of market oversight, which is essential in controlling goods prices, especially amidst the COVID-19 emergency, so that people do not face further hardship. The government is also reported to have failed to achieve its procurement targets of rice and paddy and is reported to be mulling over rice import, which may put farmers in further jeopardy by depriving them of fair price. As for edible oil and other imported goods, the government should facilitate the import through an effective intervention.

In a time when a large number of people are financially constrained, the government must not let the market become unstable. The government must, therefore, attend to issues of market manipulation by business syndicates. What is urgent is that the government should put an effective oversight mechanism in place to make appropriate market intervention. The government will certainly import rice if it needs to, but it must first fulfil its procurement targets from domestic growers.

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