Who are behind Ramadan price hike?

The state minister for commerce last week had told the newsmen in Dhaka that any hike in prices of essentials was unlikely, as there would be abundant supply of the same during the holy month of Ramadan. But that assurance has been misplaced. True, there is no supply shortage of any of the Ramadan essentials in the city's kitchen markets. Yet the prices of the overwhelming majority of the essential commodities, according to media reports, have gone through the roof. One may like to ask, why should prices go up if there is no supply shortage of commodities? In fact, as far as the experience of consumers of this part of the world goes, the laws that govern market – the law of demand and supply as explained by Alfred Marshall, Adam Smith, et al., in the eighteenth century – simply do not work here. And so one might be shocked, though not surprised, to see that yesterday, (the day before the first Ramadan day) some indispensable essentials required to prepare dishes for iftar (meals eaten to break fast) were selling at prices ranging from 50to 100 per cent higher than those were in the previous year. However, only the cooking oil, especially soybean, has refused to join the predictable race of Ramadan price hike. It appears, this cooking oil has met the expectation of the state minister for industry, who last week reportedly directed the edible oil refineries to the effect that they properly display price labels for oils. The refiners, so far, seem to have done their job well. Notably, at a city's kitchen market it was reportedly found that each one litre of bottled soybean oil was selling at Tk 160, a price cheaper by Tk10 than last year's! No doubt, inspectors of the Directorate of National Consumers Right Protection (DNCRP) have succeeded so far to keep the price of at least one vital essential Ramadan commodity stable. But going by the data provided by the Trading Corporation of Bangladesh (TCB), the government agency that buys, sells and keeps buffer stock of some selected essential commodities, the picture is rather grim for other kitchen items. Those include, for instance, onions, potatoes, garlic, ginger, etc. A TCB-listed essential, onion, for example, is more than 150 per cent costlier than it was a year before. Similarly, potato is being sold by TCB at a price that is over 50 per cent higher. Stories of imported garlic (pricier by 60 per cent), or local ginger (costlier by over 80 per cent) are not different either.

But when it comes to the prices of the essential goods in the open (kitchen) market, the picture is scarier. The prices of different varieties of date, an indispensable iftar item, were found selling between Tk 800 and Tk 2,000 a kilogramme (kg) at different city markets, whereas last year those could be had at about half those prices (Tk 400 to Tk 1,200 a kg). Sugar, lentils, chickpeas, chick pea flour and different vegetables including aubergine, tomato, green chilli, you name it, has gone beyond the reach of the common consumers. This is despite the government seems to be at war with the so-called syndicates that in popular perception are the root of all evils. But despite all the effort, the syndicates or whatever they are, remain the final arbiter of the essential commodities market. Occasional inducements like import duty cuts have, if anything, only benefited the big businesses dictating the market. But, of late, some economists have been questioning the very notion of the often-referred-to invisible syndicates behind price manipulation.

At a recent roundtable on commodity prices, market management and completion, held in the city, some experts challenged the notion of any 'syndicate, behind irrational price hike of essentials, especially of the agriculture-based products. Their argument was, as there were too many actors involved in the production and marketing of agricultural produce, it was not possible for any single entity to say the last word about the prices. As in the case of lawsuits filed against certain syndicates, the defendant was found to be a single individual who was alleged to have committed the offences in question 'in collusion', though no other parties were named involved in so called 'collusions' or 'nexuses'. Obviously, those cases were found to be without merit. Others, on the other hand, were of the view that other factors including the loopholes or weaknesses, if any, in the government's policies to control the market of commodities need also to be looked into. In fine, more stress should be laid on ensuring adequate supply of essential commodities from government's buffer stock and sell those through permanent shops run by the TCB, especially during Ramadan and before the two major Muslim religious festivals. Particularly, the government should have reliable data on the demand-supply situation and stock of different essential commodities all the year round. Better it is to import, as necessary, when those are cheaper in countries that export the items.

[email protected]