Government officials are concerned that the prices of most essential commodities might shoot up ahead of Ramadan since the grand alliance’s tenure is about to end.
In a meeting held on Monday, the price monitoring committee discussed how to regulate the prices of basic commodities by issuing special directives as Ramadan approaches. The meeting was presided over by the commerce secretary, Mahbub Ahmed, and attended by leaders of different monitoring teams.
A senior commerce ministry official said the major reasons behind the recent price hikes are: the announcement of the national budget and that this is the election year.
The official said the government was working with businessmen in Chittagong and in other parts of the country to prevent hoarding during the upcoming Ramadan.
Following the directives given at the price committee meeting, monitoring teams will meet with bazar committees and members of monitoring teams will be sent to markets outside Dhaka, especially in Khatunganj in Chittagong where imported essentials are traded wholesale. It is alleged that there are many active onion, soybean oil, lentil and chickpea syndicates in Khatunganj.
Price lists for most essential items will be put up at the entrances of bazars across the country and monitoring teams will demand ‘Paka Rashid’ from retail and wholesale traders.
A commerce ministry official said a key concern was the price of onions, which has seen constant fluctuation in spite of sufficient stocks.
In retail markets, the price of Indian imported onions has suddenly increased by Tk6 a kg, according to the Trading Corporation’s data. Local onions have also become more expensive, selling this week at Tk40 per kg from k35 a week ago.
Secretary Mahbub said the price of onion had increased only for a short period time and would definitely go down within a day or two. “A large number of imported onion trucks is now waiting to enter at the Bangladesh border,” he said.
He said there was no reason for a price hike of essentials due to budget measures as the finance minister had withdrawn the import tariff on such goods.
“There are no signs of a negative impact on the essential commodities market due to these so-called syndicates,” the secretary said when asked about Khatunganj syndicates.
“We hope the prices of essentials will be stable during the holy month of Ramadan in the election year.
“In the meeting, we have advised the leaders of monitoring teams to advise the consumers not to make extra purchase of essentials ahead of Ramadan which will disrupt the supply chain.”
Zaid Bakht, director of research at the state-owned Bangladesh Institute of Development Studies, said the prices of essentials were very likely to increase in the election year because of the excess money entering the markets for the purpose of elections.
The Minister of Finance, AMA Muhith, in his proposed budget for the 2013-14 fiscal year favoured the continuation of zero duty on imports of edible oil, pulses, wheat, rice and onion, in order to attain the 7% inflation target.
Minister Muhith, in his budget speech addressed to parliament, said the Trading Corporation of Bangladesh (TCB) was being strengthened, consumers’ rights were being ensured and the work to form a competition commission to prevent syndication among businesses was in progress.
The minister spoke about how the government had succeeded in checking inflation by building up a satisfactory food stock, distributing grain at fair prices among the poor and continuing its policy support in the agricultural sector.
He said the removal of supply placed constraints on different sectors like power and energy and the continuation of a tight monetary policy had helped the government keep non-food inflation under control.
According to data from the TCB, compared to last year, prices of per litre loose soybean and palm oil were 11% and 27% lower respectively on June 5 and sugar prices had fallen by 13% to Tk45-56 a kg. Influenced by these relatively stable food prices, non-food inflation has also decreased gradually.
