Commodity price hike: Is tariff removal the solution?
Tuesday, 26 June 2007
Dr. Rashid ul Ahsan Chowdhury
IN recent times, the continuous price spiral of essential commodities in the market has created a dilemma and embarrassment for the government. The price of essential commodities like rice, wheat, chickpeas, garlic, edible oil, sugar and the like have continued to show an upward trend during the last couple of years. In spite of sincere and honest attempts, the government has so far failed to subdue this upward price escalation. In this respect, there has been serious clamour in the business circle, particularly from the importers of essential commodities, to either reduce or en block eliminate customs duty and other taxes on these items. Deeply concerned with keeping the price of such commodities stable in the market, the government has succumbed to such pressure, and has either reduced or completely brought down the tariff rate to zero.
For example, the total tax incidence on rice was 7.50% in fiscal year (FY) 2004-05 and it was brought down to 6.0% in FY 2005-06 and ultimately to 0% in FY 2006-07. Similar measure was taken in the case of wheat as well. The total tax incidence for the importation of chickpeas in bulk was 14.50% in FY 2004-05. It was reduced to 13% in FY 2005-06 and ultimately to 0% in FY 2006-07. In the case of onion, the tax incidence in FY 2004-05 was 14.50% and it was reduced to 13% in 2005-06 and to 0% in 2006-07. In the case of peas too, a similar trend can be observed. In FY 2004-05 total tax incidence on peas was 14.50%, which was reduced to 13% in 2005-06 and to 0% in 2006-07.
The graph chart below depicts overall scenario of the reduction in tax incidence:
The lowering of the duty rate, however, has not been successful in either reducing prices or keeping price of these commodities stable in the market. In 2005-06 the price of one kilogram(kg) of medium standard rice was Taka 14 in the market but today the same amount will require Taka 28 to purchase. The price of flour was Taka 15 per kg in 2005-06, which has jumped up to Taka 26 recently. The price of chickpeas was Taka 20 in 2004-05 whereas it is now available at a price of Taka 38 per kg. The price of onion has increased by Taka 7.0 per kg during the last two years, whereas the price of peas has shot up to Taka 42 per kg during the last two years. On an average the price of these commodities has inflated by 90% during the last two years while the national inflation rate hovered between 6% and 9%. This abnormal price hike occurred in spite of the fact that all these items have a zero tariff on them.
The graph below shows price hike trend of essential commodities during the last two years:
Obviously, this trend shows that reduction in tax incidence cannot be a solution to keep the price of essential commodities stable in the market.
During the last three years, the government has lost revenue to the tune of Taka 12 billion(1200 crore) because of reduction/removal in duties of essential food items. Although the government compromised on its revenue earning, it has not been the beneficiary but rather stands at the loser's end, because the consumers could not buy these commodities at a cut back price from the market. The wholesale importers were probably the substantial gainers. On the one hand they were required not to pay the duties and taxes liveable on their import, and on the other, they ignored the government gesture by keeping their sale price at the pre-duty exemption level. In some cases, only profit seeking turned out to be the main goal and advantage was reaped out of both the duty exemption and the unstable market condition.
In fact price hike generates not from the customs duty structure of the country but from other important issues. A primary consideration for price hike is the international price of essential food items. The price of agricultural commodities is always flexible and depends on the demand and supply condition in the international market. A search in the prevailing price condition in the international market reveals that on items like rice, wheat, onion, chickpeas and peas the price has shot up by almost 10% to 15% than the previous year. Obviously, the end consumers in Bangladesh have felt its impact.
A second reason is the increase in price of fuel. Over the years the government has protected and provided subsidy to the Bangladesh Petroleum Corporation(BPC) to sell fuel in the local market at a much lower price than the cost price. Although the market price of fuel is around US$ 72 per barrel in the international market, the valuation basis for duty payable on the import of fuel has remained fixed at $32 per barrel. Even then over the years, the BPC has paid almost no duty to the government. In spite of all the support from the government, the Corporation is still a losing concern, and due to this reason the government had to increase the sale price of fuel locally. This has considerably affected the cost of transporting essential food items from wholesalers to retailers around the nook and corner of the country. The net impact on the rise in fuel price has affected the price of essential commodities too.
One important tool to control the price of essential items is to control the value of money itself. Making the value of taka strong in comparison with dollar could be one way to do this. Right at this moment, the government has a strong foreign exchange reserve and the earnings from export and remittance is showing a healthy growth. In the remittance sector alone, it is expected that the amount of repatriation will exceed more than six billion dollars this year. Given this scenario and considering the weakening of dollar against all the major foreign currencies, it is expected that the value of taka should have been much stronger against the dollar than it actually is. In the last five years the foreign exchange reserve has increased by 3.0%, remittance by 2.0% and export by almost 30%, but strangely the strength of taka has shown a sharp downhill trend during these years. As Bangladesh is an import-oriented country, the devaluation of taka has considerably affected the price of all commodities imported into the country.
In comparison to the situation in Bangladesh, our next-door neighbours are in a far better shape with regard to the strength of their currency against the dollar. During the last couple of years, as like Bangladesh, foreign exchange reserves, remittance and exports in India and Pakistan have increased manifold, and consequently the governments of these two countries were able to strengthen their currency against the dollar. In the year 2001-02, the exchange rate for US$ 1.00 was 49 rupees in India; where as in 2006-07 the exchange rate for US$ 1.00 is 43 rupees. In Pakistan, in the year 2001-02, the exchange rate for US$ 1.00 was 71.00 rupees; where as the exchange rate now for US $1.00 is 60.00 rupees. As against this, in Bangladesh, the exchange rate in 2001-02 for US$ 1.00 was Taka 60 which has now jumped to Taka 69.00. This statistics gives a very bleak picture of the situation in Bangladesh.
There are two major reasons for the failure to control depreciation of the value of taka against dollar in Bangladesh. In recent years the illegal outflight of dollar from Bangladesh has increased alarmingly. This has created a shortage of the currency in the local market, and consequently raised the value of dollar against taka. The seizure pattern of currency at the Zia International Airport justifies this statement. In 2005-2006, the seizure of foreign currency at Zia International Airport was Taka 67.6 million (6.76 crore), whereas in the first eleven months of 2007 the seizure has increased excessively high to around Taka 224.3 million (22.43 crore). Another reason for depreciation of taka is the greed of a group of unscrupulous exporters, who for their personal financial gain, have manipulated the currency market over the years and intentionally kept the strength of taka feeble against dollar.
Problem in the supply chain and absence of predictability are two other factors related with price hike. The supply chain stretching from the producer to the end consumer is distorted by too many constrictions that in turn affect the price of commodities in the market. When importing essential commodities the importers often need to pay extra cost for unloading of goods and for customs clearance from the port. The continuous rise of fuel price adds to the cost. In addition, the commodities ultimately reach the market via too many middlemen, and at each step there is a consequential rise in price. In the case of domestic production also, the involvement of too many middleman in the supply chain exorbitantly raises the price of commodities.
In Bangladesh, business transaction cost is one of the highest in the world, which is against the norms of the competitive market. In this transaction, not only the middlemen, but also the bureaucrats, politicians and businessman form syndicates at the supply and demand side both within and outside the country. This happens because of the existence of a complex system in the marketing and distribution process of essential commodities. The system involves a very few importers who practise oligopolistic strategy, a limited number of wholesalers, a large number of retailers and a good number of intermediaries operating between these three parties. They manipulate and control the price of commodities at their will in order to enhance their profit and thus turn into price givers. Uncertainty about the availability of commodities in the market, hoarding of goods by syndicates and failure to predict the demand and supply situation also affect price of goods in the market. The economic rent imposed by these syndicates is the main contributor for price hike and in terms of these economic rent government duties and taxes are a merger amount. Therefore in Bangladesh, the free market is not always free.
An average family spends more than 52% of the total disposable income on food items in Bangladesh. The recent price hike has compelled these families to spend more on food, thus reducing the share of other items in their consumption basket. This is leading to a reduction in standard of living of average middle class household. During the time of political governments, transportation and selling of commodities had their own dynamics. In a modern market system, the middlemen or the distributors are the integral parts of the whole supply chain. The local workers or sidekicks of the elite politicians acted as a catalyst for the free flow of goods in the supply chain. They did it not out of any philanthropic interest but for their personal gain only. Nevertheless, the supply of commodities maintained a free flow, which in turn kept the prices somewhat under control. Their sudden withdrawal from the supply and distribution system has created a vacuum in the flow system of goods. Again, under the changed circumstances after 11th January 2007, various measures adopted by the interim government to control the supply and distribution chain has eliminated some established links in the supply chain. Also the drive to clean up hawkers and roadside markets played a significant role in increasing the price of essentials in the name of "compliance cost". For instance, a shopkeeper who used to sell from a makeshift road stall did not have to pay any rent as such and the transportation cost was nearly half due to the "facilities" offered by law enforcement agencies and political leaders. Transports were always overloaded and food items when available in every corner of the street.
It is extremely difficult for the government to control price hike of commodities in the market, especially when the government strongly believes in free market economy. However, adaptation of a number of measures by the government may help to check to a considerable extent the price spiral of goods in the market. One way would be to reduce Letter of credit (LC) margin by the banks for importation of essential commodities. The LC margin should not exceed more than 5.0% in any case and the interest payable on the LC should not be more than 6.0 % to 8.0%. This will enable the importers to endure the expenses of import and they will be encouraged to import in bulk that, in turn, would also help control the price hike. Instead of encouraging syndicate operation on essential items, the government should also encourage small and medium-sized importers to import essential food commodities. In this respect the banks can provide support by granting financial loans on easy terms.
The procedures for clearance of essential commodities at the import stage should be made transparent and easy, and customs clearance be expedited to the fullest extent possible. Simplification of procedures and reduction in the port clearance time will save money for the importers, consequently having an impact on the sale price. Again, encouraging small and medium scale importers to import essential items will break the oligopolistic behaviour of business syndicates leading to fair market competition and reduction in prices. The Trading Corporation of Bangladesh, which is currently inoperative, should be geared up extensively to import essential items on behalf of the government. If need be, the government should provide subsidy to the company and spread its wings to every corner of the country. The use of TCB as a purchaser, supplier, and seller at the retail stage will eliminate the role of middlemen and rent-seekers and keep the price of commodities secure in the market. Instead of reducing duties on essential items, the government can invest the collected duty amount for improving the efficiency and effectiveness of the TCB as well. The money to be spent can be used either as subsidy for the organisation or for developing its infrastructure.
The use of Open Market Sale (OMS) by the government as a temporary measure to prevent the commodity price spirals should be continued. A recent significant development is that the government has decided to sell 100,000 tonnes of wheat and 100,000 tonnes of rice at the open market.
Further, the BDR is carrying out "Operation Dal Bhat" by establishing temporary markets in more than 25 spots in Dhaka city. These measures have helped restrain the price hike and allowed the consumers to have a breathing space.
But it has to be remembered that Bangladesh is essentially a huge market for consumption of essential food items. With the population figure touching 150 million mark, it will not be possible to control the market mechanism of supply and distribution by the TCB and BDR alone. Both these agencies have neither the capacity nor experience and manpower to control the extensive supply and distribution chain. Their involvement can only be on ad hoc basis to create immediate impact on the price hike. Ultimately, the solution will lie in developing a smooth and barrier-free supply and distribution system involving both the government and the business.
Another way to control the price could be to divert donor grant for purchase of essential food items. Many grants given by donor agencies for technical or economic assistance remain unutilised or are compromised because of bureaucratic inefficiency. Therefore, the purposes for which such grants are given do not materialise or fulfil the targeted goals. If such grants were diverted for purchase of foodgrain, the pressure on the government could be substantially reduced. This, however, will require consent from the donors. Again, the government may negotiate with donors for new grants for purchase of food grains but such a measure would require good negotiation skill on the part of the government officials.
The intervention of the government in the supply chain management could possibly help in controlling the price of essential food items in the market. This could be done by effectively implementing anti-hoarding laws, ensuring smooth and safe transportation of goods, encouraging wholesalers to minimise steps for distribution of imported food items to the markets and keeping careful watch over the retail sale so that unscrupulous traders do not arbitrarily raise prices for extra profit gain. Recently, the Bangladesh Rifles(BDR) has done that in order to contain the arbitrary and irresponsible behaviour of the traders after the declaration of budget, and has thus been able to contain the price of sugar, lentils and vegetable oil.
Most important, the government should undertake a serious publicity campaign to emphasise the need for self-dependency on food items. The agricultural sector should be viewed as the most important thrust sector and necessary support and funding be given to boost up production of food commodities.
Whatever said, it needs to be understood that the government alone cannot contain the price hike of food commodities in the market. In this respect, co-operation from the business community and the public in general is vital. While the mass of the people should be careful about needless spending and wastage, the business community should be patriotic and dedicated to serve the interest of the public. A combination of efforts on both sides will surely have a good impact on the price scenario of essential commodities in the markets of Bangladesh.
IN recent times, the continuous price spiral of essential commodities in the market has created a dilemma and embarrassment for the government. The price of essential commodities like rice, wheat, chickpeas, garlic, edible oil, sugar and the like have continued to show an upward trend during the last couple of years. In spite of sincere and honest attempts, the government has so far failed to subdue this upward price escalation. In this respect, there has been serious clamour in the business circle, particularly from the importers of essential commodities, to either reduce or en block eliminate customs duty and other taxes on these items. Deeply concerned with keeping the price of such commodities stable in the market, the government has succumbed to such pressure, and has either reduced or completely brought down the tariff rate to zero.
For example, the total tax incidence on rice was 7.50% in fiscal year (FY) 2004-05 and it was brought down to 6.0% in FY 2005-06 and ultimately to 0% in FY 2006-07. Similar measure was taken in the case of wheat as well. The total tax incidence for the importation of chickpeas in bulk was 14.50% in FY 2004-05. It was reduced to 13% in FY 2005-06 and ultimately to 0% in FY 2006-07. In the case of onion, the tax incidence in FY 2004-05 was 14.50% and it was reduced to 13% in 2005-06 and to 0% in 2006-07. In the case of peas too, a similar trend can be observed. In FY 2004-05 total tax incidence on peas was 14.50%, which was reduced to 13% in 2005-06 and to 0% in 2006-07.
The graph chart below depicts overall scenario of the reduction in tax incidence:
The lowering of the duty rate, however, has not been successful in either reducing prices or keeping price of these commodities stable in the market. In 2005-06 the price of one kilogram(kg) of medium standard rice was Taka 14 in the market but today the same amount will require Taka 28 to purchase. The price of flour was Taka 15 per kg in 2005-06, which has jumped up to Taka 26 recently. The price of chickpeas was Taka 20 in 2004-05 whereas it is now available at a price of Taka 38 per kg. The price of onion has increased by Taka 7.0 per kg during the last two years, whereas the price of peas has shot up to Taka 42 per kg during the last two years. On an average the price of these commodities has inflated by 90% during the last two years while the national inflation rate hovered between 6% and 9%. This abnormal price hike occurred in spite of the fact that all these items have a zero tariff on them.
The graph below shows price hike trend of essential commodities during the last two years:
Obviously, this trend shows that reduction in tax incidence cannot be a solution to keep the price of essential commodities stable in the market.
During the last three years, the government has lost revenue to the tune of Taka 12 billion(1200 crore) because of reduction/removal in duties of essential food items. Although the government compromised on its revenue earning, it has not been the beneficiary but rather stands at the loser's end, because the consumers could not buy these commodities at a cut back price from the market. The wholesale importers were probably the substantial gainers. On the one hand they were required not to pay the duties and taxes liveable on their import, and on the other, they ignored the government gesture by keeping their sale price at the pre-duty exemption level. In some cases, only profit seeking turned out to be the main goal and advantage was reaped out of both the duty exemption and the unstable market condition.
In fact price hike generates not from the customs duty structure of the country but from other important issues. A primary consideration for price hike is the international price of essential food items. The price of agricultural commodities is always flexible and depends on the demand and supply condition in the international market. A search in the prevailing price condition in the international market reveals that on items like rice, wheat, onion, chickpeas and peas the price has shot up by almost 10% to 15% than the previous year. Obviously, the end consumers in Bangladesh have felt its impact.
A second reason is the increase in price of fuel. Over the years the government has protected and provided subsidy to the Bangladesh Petroleum Corporation(BPC) to sell fuel in the local market at a much lower price than the cost price. Although the market price of fuel is around US$ 72 per barrel in the international market, the valuation basis for duty payable on the import of fuel has remained fixed at $32 per barrel. Even then over the years, the BPC has paid almost no duty to the government. In spite of all the support from the government, the Corporation is still a losing concern, and due to this reason the government had to increase the sale price of fuel locally. This has considerably affected the cost of transporting essential food items from wholesalers to retailers around the nook and corner of the country. The net impact on the rise in fuel price has affected the price of essential commodities too.
One important tool to control the price of essential items is to control the value of money itself. Making the value of taka strong in comparison with dollar could be one way to do this. Right at this moment, the government has a strong foreign exchange reserve and the earnings from export and remittance is showing a healthy growth. In the remittance sector alone, it is expected that the amount of repatriation will exceed more than six billion dollars this year. Given this scenario and considering the weakening of dollar against all the major foreign currencies, it is expected that the value of taka should have been much stronger against the dollar than it actually is. In the last five years the foreign exchange reserve has increased by 3.0%, remittance by 2.0% and export by almost 30%, but strangely the strength of taka has shown a sharp downhill trend during these years. As Bangladesh is an import-oriented country, the devaluation of taka has considerably affected the price of all commodities imported into the country.
In comparison to the situation in Bangladesh, our next-door neighbours are in a far better shape with regard to the strength of their currency against the dollar. During the last couple of years, as like Bangladesh, foreign exchange reserves, remittance and exports in India and Pakistan have increased manifold, and consequently the governments of these two countries were able to strengthen their currency against the dollar. In the year 2001-02, the exchange rate for US$ 1.00 was 49 rupees in India; where as in 2006-07 the exchange rate for US$ 1.00 is 43 rupees. In Pakistan, in the year 2001-02, the exchange rate for US$ 1.00 was 71.00 rupees; where as the exchange rate now for US $1.00 is 60.00 rupees. As against this, in Bangladesh, the exchange rate in 2001-02 for US$ 1.00 was Taka 60 which has now jumped to Taka 69.00. This statistics gives a very bleak picture of the situation in Bangladesh.
There are two major reasons for the failure to control depreciation of the value of taka against dollar in Bangladesh. In recent years the illegal outflight of dollar from Bangladesh has increased alarmingly. This has created a shortage of the currency in the local market, and consequently raised the value of dollar against taka. The seizure pattern of currency at the Zia International Airport justifies this statement. In 2005-2006, the seizure of foreign currency at Zia International Airport was Taka 67.6 million (6.76 crore), whereas in the first eleven months of 2007 the seizure has increased excessively high to around Taka 224.3 million (22.43 crore). Another reason for depreciation of taka is the greed of a group of unscrupulous exporters, who for their personal financial gain, have manipulated the currency market over the years and intentionally kept the strength of taka feeble against dollar.
Problem in the supply chain and absence of predictability are two other factors related with price hike. The supply chain stretching from the producer to the end consumer is distorted by too many constrictions that in turn affect the price of commodities in the market. When importing essential commodities the importers often need to pay extra cost for unloading of goods and for customs clearance from the port. The continuous rise of fuel price adds to the cost. In addition, the commodities ultimately reach the market via too many middlemen, and at each step there is a consequential rise in price. In the case of domestic production also, the involvement of too many middleman in the supply chain exorbitantly raises the price of commodities.
In Bangladesh, business transaction cost is one of the highest in the world, which is against the norms of the competitive market. In this transaction, not only the middlemen, but also the bureaucrats, politicians and businessman form syndicates at the supply and demand side both within and outside the country. This happens because of the existence of a complex system in the marketing and distribution process of essential commodities. The system involves a very few importers who practise oligopolistic strategy, a limited number of wholesalers, a large number of retailers and a good number of intermediaries operating between these three parties. They manipulate and control the price of commodities at their will in order to enhance their profit and thus turn into price givers. Uncertainty about the availability of commodities in the market, hoarding of goods by syndicates and failure to predict the demand and supply situation also affect price of goods in the market. The economic rent imposed by these syndicates is the main contributor for price hike and in terms of these economic rent government duties and taxes are a merger amount. Therefore in Bangladesh, the free market is not always free.
An average family spends more than 52% of the total disposable income on food items in Bangladesh. The recent price hike has compelled these families to spend more on food, thus reducing the share of other items in their consumption basket. This is leading to a reduction in standard of living of average middle class household. During the time of political governments, transportation and selling of commodities had their own dynamics. In a modern market system, the middlemen or the distributors are the integral parts of the whole supply chain. The local workers or sidekicks of the elite politicians acted as a catalyst for the free flow of goods in the supply chain. They did it not out of any philanthropic interest but for their personal gain only. Nevertheless, the supply of commodities maintained a free flow, which in turn kept the prices somewhat under control. Their sudden withdrawal from the supply and distribution system has created a vacuum in the flow system of goods. Again, under the changed circumstances after 11th January 2007, various measures adopted by the interim government to control the supply and distribution chain has eliminated some established links in the supply chain. Also the drive to clean up hawkers and roadside markets played a significant role in increasing the price of essentials in the name of "compliance cost". For instance, a shopkeeper who used to sell from a makeshift road stall did not have to pay any rent as such and the transportation cost was nearly half due to the "facilities" offered by law enforcement agencies and political leaders. Transports were always overloaded and food items when available in every corner of the street.
It is extremely difficult for the government to control price hike of commodities in the market, especially when the government strongly believes in free market economy. However, adaptation of a number of measures by the government may help to check to a considerable extent the price spiral of goods in the market. One way would be to reduce Letter of credit (LC) margin by the banks for importation of essential commodities. The LC margin should not exceed more than 5.0% in any case and the interest payable on the LC should not be more than 6.0 % to 8.0%. This will enable the importers to endure the expenses of import and they will be encouraged to import in bulk that, in turn, would also help control the price hike. Instead of encouraging syndicate operation on essential items, the government should also encourage small and medium-sized importers to import essential food commodities. In this respect the banks can provide support by granting financial loans on easy terms.
The procedures for clearance of essential commodities at the import stage should be made transparent and easy, and customs clearance be expedited to the fullest extent possible. Simplification of procedures and reduction in the port clearance time will save money for the importers, consequently having an impact on the sale price. Again, encouraging small and medium scale importers to import essential items will break the oligopolistic behaviour of business syndicates leading to fair market competition and reduction in prices. The Trading Corporation of Bangladesh, which is currently inoperative, should be geared up extensively to import essential items on behalf of the government. If need be, the government should provide subsidy to the company and spread its wings to every corner of the country. The use of TCB as a purchaser, supplier, and seller at the retail stage will eliminate the role of middlemen and rent-seekers and keep the price of commodities secure in the market. Instead of reducing duties on essential items, the government can invest the collected duty amount for improving the efficiency and effectiveness of the TCB as well. The money to be spent can be used either as subsidy for the organisation or for developing its infrastructure.
The use of Open Market Sale (OMS) by the government as a temporary measure to prevent the commodity price spirals should be continued. A recent significant development is that the government has decided to sell 100,000 tonnes of wheat and 100,000 tonnes of rice at the open market.
Further, the BDR is carrying out "Operation Dal Bhat" by establishing temporary markets in more than 25 spots in Dhaka city. These measures have helped restrain the price hike and allowed the consumers to have a breathing space.
But it has to be remembered that Bangladesh is essentially a huge market for consumption of essential food items. With the population figure touching 150 million mark, it will not be possible to control the market mechanism of supply and distribution by the TCB and BDR alone. Both these agencies have neither the capacity nor experience and manpower to control the extensive supply and distribution chain. Their involvement can only be on ad hoc basis to create immediate impact on the price hike. Ultimately, the solution will lie in developing a smooth and barrier-free supply and distribution system involving both the government and the business.
Another way to control the price could be to divert donor grant for purchase of essential food items. Many grants given by donor agencies for technical or economic assistance remain unutilised or are compromised because of bureaucratic inefficiency. Therefore, the purposes for which such grants are given do not materialise or fulfil the targeted goals. If such grants were diverted for purchase of foodgrain, the pressure on the government could be substantially reduced. This, however, will require consent from the donors. Again, the government may negotiate with donors for new grants for purchase of food grains but such a measure would require good negotiation skill on the part of the government officials.
The intervention of the government in the supply chain management could possibly help in controlling the price of essential food items in the market. This could be done by effectively implementing anti-hoarding laws, ensuring smooth and safe transportation of goods, encouraging wholesalers to minimise steps for distribution of imported food items to the markets and keeping careful watch over the retail sale so that unscrupulous traders do not arbitrarily raise prices for extra profit gain. Recently, the Bangladesh Rifles(BDR) has done that in order to contain the arbitrary and irresponsible behaviour of the traders after the declaration of budget, and has thus been able to contain the price of sugar, lentils and vegetable oil.
Most important, the government should undertake a serious publicity campaign to emphasise the need for self-dependency on food items. The agricultural sector should be viewed as the most important thrust sector and necessary support and funding be given to boost up production of food commodities.
Whatever said, it needs to be understood that the government alone cannot contain the price hike of food commodities in the market. In this respect, co-operation from the business community and the public in general is vital. While the mass of the people should be careful about needless spending and wastage, the business community should be patriotic and dedicated to serve the interest of the public. A combination of efforts on both sides will surely have a good impact on the price scenario of essential commodities in the markets of Bangladesh.