Following a meeting with the businessmen last month, commerce minister Tofail Ahmed said that the supply of commodities including lentils, edible oil, sugar, gram, onion and garlic was higher in the market than the demand. In the meeting, he told the traders there is no reason why the prices should rise. If any quarter of traders tries to gain extra profit creating artificial crisis on the market, they will be brought to book, he assured.
While this is a common practice on the part of the retailers to increase prices of commodities at their whims during the month of Ramadan to reap extra profit, concerned minister and officials always try to allay the fears of the consumers by trying to assure them of a stable kitchen market.
This time as well, the assurance of the minister to keep the essentials' prices within tolerable limit went in vain. The prices of sugar, red lentil, onion, brinjal, cucumber etc., went up soon after his meeting with the traders.
The day after the commitment of the minister, prices of onion, gram and red lentil started to increase. Before the meeting, sugar was selling at Tk 38-Tk 46 per kilogramme (kg), red lentil at Tk 85-Tk 110 per kg and gram at Tk 55 per kg. two days after the meting, sugar was selling at Tk 42-Tk 48 per kg, red lentil at Tk 95-Tk 130 per kg and gram at Tk 65 per kg. The local onion was selling at Tk 40-Tk 48 a kg while the imported item was retailing at Tk 30-Tk 42 a kg late last week, say reports.
The price of red lentil increased by Tk 5.0 a kg and the fine variety of the item was selling at Tk 115-Tk 125 a kg while its local variety was selling at Tk 130 a kg. The red lentil imported from Turkey and Canada was selling at Tk 100 a kg over the week. However, the traders said that the import of the item decreased in recent times as the supply of the item from Nepal, the major importing source, was halted due to a tragic earthquake in the country.
When the holy Ramadan is just only few days ahead, the kitchen market has already started to show some volatility. All of a sudden, there was almost 100 to 200 per cent rise in the prices of leafy vegetables. Prices of green chillies shot up to Tk 60 per kilogram (kg) from Tk 10-15 a kg two days ago. Market watchers failed to find any reason that justified the sudden rise.
Past trend suggests that when price monitoring teams visited the kitchen markets, unscrupulous traders acted quickly to lower the prices of essentials. But when they left, the traders went back to their normal practice of charging higher rates. Price charts entangled in different markets do not show the real commodity prices. Statements given by the members of the price monitoring teams do not match the real picture of the kitchen market.
Thus all mechanisms to control the overheated market and thus ease the consumers' sufferings during Ramadan fall flat. People's sufferings are getting worse. Even the traders do not keep up their promises. Several directives that had came from Prime Minister's Office earlier to keep the prices of essentials within the commoners' reach fell into deaf ears.
Market monitoring teams sometimes realised fines when they found irregularities during their visits to the kitchen market. Such efforts are meaningless unless the traders at fault are punished for their wrongdoings. For example, if a trader is fined Tk 10, then he'll try to make a profit of Tk 20 to cover up his losses. So, what's the rationale of slapping such penalty?
In a free market economy the government does not do business and has no direct authority over the market. As such, the control of the market largely goes to the businessmen, many of whom are unscrupulous and greedy. It is this particular group of business people who, taking the advantage of free market economy, manipulate the market for their benefit. Market analysts say there should be certain level of government control over the market so that in a crisis situation it can intervene and uphold the interest of the consumers.
However, factors like incessant rains, bad condition of the roads are partly responsible for the price hike of essentials at the moment. Vegetable supply to the capital city mostly originates from Narsinghdi, Manikganj, Jessore etc. But such supply is being constrained by worsening condition of the roads, toll collection at different points and higher fares charged by trucks and ferries.
With the Competition Law now enacted, the government should not hesitate to take punitive actions against price manipulations and hoarders of essential items. However, any move to control the prices, including one that addresses the syndicates, should not look like only any eyewash.
Stockpiling and hoarding are also said to be among the major causes of price hike. Although the successive governments have carried out anti-hoarding drives from time to time, very few offenders were prosecuted. A sincere intent to relieve the public of their sufferings surely calls for better-coordinated, well-concerted measures coupled with policy directions.
Most importantly, the government policies should be directed towards bringing the producers and the consumers closer to help lower the prices by minimising intervention of middlemen. That is the most challenging task for the government. Given the current context of global development, it would be hardly possible for a country like Bangladesh to satisfy both producers and consumers through subsidy.
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