ADB wants city corp. to cede 'interventions'

Firing a broadside at the "interventionist" role of the city authorities, the Asian Development Bank (ADB) has said establishing private management for Dhaka's key wholesale markets is imperative to make their operations financially viable.
"The current management of the wholesale market is too interventionist," the Asian multilateral financier said in a new report launched on Tuesday. "The operation lacks transparency and the markets are underfunded, especially for repairs and maintenance due to insufficient collection of revenue."
Not only the quality of services provided by the management to the traders is poor, but also there is "serious lack of coordination" among different actors within the management.
No price information is made available for sellers and buyers and no measures are taken to ensure food safety, according to the report, co-authored by Akmal Siddiq and Abul Basher of the Bank's rural development and food security thematic group.
The Sustainable Development and Climate Change Department within the ADB produced the policy report titled "Dysfunctional Horticulture Value Chains and the Need for Modern Marketing Infrastructure: The Case of Bangladesh" and has been launched at the "Rural Development and Food Security" Forum, now underway here.
The participation of the private sector in market management "has to be considered to make the operation financially available," argued the authors.
Rents and charges of new wholesale markets should be competitive to provide commission agents, wholesalers and potential tenants with "sufficient incentives" to use the market facilities, thus enabling them to repay the capital cost of building.
In the long term, the authors recommended relocating the existing wholesale markets to the outskirts of Dhaka since their physical limitation cannot be solved due to space constraints at Kawran Bazar, Badamtoli and Swarighat.
Giving the new features of the new wholesale markets, the report insisted those would offer services such as phytosanitary inspections, certifications, traceability, lab examination, electronic auction, banking, catering, accommodation price information, among other facilities.
Also, the new wholesales will improve collection and marketing of products in the production areas.
For example, the report noted, collection centres with cooling and packaging houses and other agri-logistics have to be developed for easy access by farmers and small traders.
The supply chain of fruits and vegetables in Bangladesh is dominated by people acting as go-between. In most cases, marketing involves local traders, commission agents, wholesalers and retailers.
Presently, post-harvest losses in fruits and vegetables are exceedingly high owing to mishandling of the perishables, poor transportation, inadequate storage facilities, lack of cold storage both at production areas and wholesale markets and rickety market infrastructure.
For instance, open trucks, overloaded with other goods, are mostly used for transporting fresh produce, which results in the deterioration of quality.
With fewer than 400 cold storage facilities operating in the country, wholesale markets struggle to use those.
The new infrastructure would help slash post-harvest losses and improve food safety.
If the current post-harvest loss can be curtailed by three-quarters, the study figured out that this would save more than $1.87 billion a year.
The idea of private management for Dhaka's wholesale markets comes as the demand for fruits and vegetables in the capital city of 20 million is projected to more than triple to 6.57 million tonnes by 2025, propelled by rising income and a burgeoning middle-class, whose number is projected by the ADB to rise to 50 million by 2030 from the current 30 million.
Asia's fastest-growing economy, Bangladesh is also on track to join the league of Next Eleven club, the countries with the potential for becoming the world's economic superpowers in the 21st century.
The country's per capita income exploded to $1,909 in the financial year 2019, around five-fold increase since 2000.
Traditionally, rice is the staple diet in Bangladesh, but its share has been on the wane in recent years with higher consumption of vegetables and fruits.
Despite this growing trend, daily consumption of fruits and vegetables in the country is low compared with its peers in South Asia.
In 2013, per person vegetable consumption was just about 27 kilogrammes, lagging behind Europe and the United States, where it was 115 kg and 114 kg respectively.
Similarly, per person fruit consumption in the same year was 23 kg in Bangladesh, far dwarfed by 105 kg in the US and 95 kg in Europe.
While the Bank currently remains a leading multilateral financier in Bangladesh's energy, transport and education sectors, rural development and food security has been thrust into spotlight, emerging as one of seven operational "priorities" of its 2030 strategy.
Excluding co-financing, with a flow of US$2.2 billion last year, Bangladesh became the second-largest recipient of the ADB aid, trailing only India that pulled $ 3.5 billion in credit.
Indeed, the country is among top five recipients in the continental Asia, displacing the likes of China, Indonesia and Uzbekistan.
The three-day Forum that drew more than 700 delegates comprising farmers, youths, government officials, policymakers, civil society and donor and the United Nations representatives concludes tomorrow (Wednesday).

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