Govt bypasses procurement laws to purchase food for Ramadan
Sunday, 23 May 2010
Nazmul Ahsan
The government has decided to buy Ramadan food items directly from local and foreign markets, sidestepping the country's procurement laws for the second time this year.
Commerce Ministry officials said they would float no tender to buy thousands of tonnes of sugar, edible oil, lentil and chick-peas as they seek to build a war-chest to fight price manipulators during Ramadan.
"We don't have enough time to invite tender to buy the essential food items. We will purchase the items as soon as possible and sell them in open market at a cheaper rate to keep prices down during Ramadan," an official said.
"If we float tender, it will be impossible to buy the items before Ramadan. Direct purchase saves money and time," he said.
The government has granted commerce ministry immunity from the public procurement laws to make the purchase directly from the local and foreign sources, officials said.
Experts criticised the move, saying it would give way to wide-spread graft and set a "bad precedence", which will be cashed in on by tender-shy government bureaucrats.
This is the second time the Awami League government has put aside the procurement laws enacted in 2006 to combat graft in public procurement deals.
Last month the cabinet committee on purchase approved unsolicited power plant deals worth tens of billions of taka with local and foreign companies despite protests from political and rights groups.
Trade officials, however, say they see no foul-play in the immunity, adding that they would ensure transparency into the purchase deals.
"Under the government decision, we will procure essential food items in tranches each worth Tk50,000. Our aim is to buy the items quickly and intervene in the market if prices go up abnormally in Ramadan," said the official.
Prices of food items such as chick-peas, sugar and edible oil shoot up in Ramadan as Muslims prefer spicy and snack items for breaking their fast during the holy month.
Officials said the government has okayed commerce ministry's decision to procure 30,000 tonnes of sugar bypassing the tendering process. The amount would cost more than a billion taka at the present market value.
A team of trade officials led by Commerce Secretary Ghulam Hossain visited local sugar mills and refineries last week to finalise purchase deals, officials said.
"Refiners have assured us that they would sell sugar at a rate lower than their mill-gate price," a member of the team told the FE.
Commerce ministry officials said they have planned to buy another 20,000 tonnes of soybean oil from local refiners, ignoring the tendering process to save time and money needed to process bidding documents.
"Local refiners are interested to sell the amount of soybean at a rate lower than mill-gate price," said an official.
The ministry has also decided to procure 2,000 tonnes of lentil from local source and another 1,000 tonnes from foreign source. It has also plans to buy a more than a thousand tones chickpeas from local and foreign markets.
"Our aim is plain and simple: to build a buffer stock for food items ahead of Ramadan. If we follow the tendering process, the purchase could be delayed, which will obviously be capitalised by the private traders," said the official.
"Tendering eats up some precious time, which neither the government nor the consumers can afford," he added.
The government has decided to buy Ramadan food items directly from local and foreign markets, sidestepping the country's procurement laws for the second time this year.
Commerce Ministry officials said they would float no tender to buy thousands of tonnes of sugar, edible oil, lentil and chick-peas as they seek to build a war-chest to fight price manipulators during Ramadan.
"We don't have enough time to invite tender to buy the essential food items. We will purchase the items as soon as possible and sell them in open market at a cheaper rate to keep prices down during Ramadan," an official said.
"If we float tender, it will be impossible to buy the items before Ramadan. Direct purchase saves money and time," he said.
The government has granted commerce ministry immunity from the public procurement laws to make the purchase directly from the local and foreign sources, officials said.
Experts criticised the move, saying it would give way to wide-spread graft and set a "bad precedence", which will be cashed in on by tender-shy government bureaucrats.
This is the second time the Awami League government has put aside the procurement laws enacted in 2006 to combat graft in public procurement deals.
Last month the cabinet committee on purchase approved unsolicited power plant deals worth tens of billions of taka with local and foreign companies despite protests from political and rights groups.
Trade officials, however, say they see no foul-play in the immunity, adding that they would ensure transparency into the purchase deals.
"Under the government decision, we will procure essential food items in tranches each worth Tk50,000. Our aim is to buy the items quickly and intervene in the market if prices go up abnormally in Ramadan," said the official.
Prices of food items such as chick-peas, sugar and edible oil shoot up in Ramadan as Muslims prefer spicy and snack items for breaking their fast during the holy month.
Officials said the government has okayed commerce ministry's decision to procure 30,000 tonnes of sugar bypassing the tendering process. The amount would cost more than a billion taka at the present market value.
A team of trade officials led by Commerce Secretary Ghulam Hossain visited local sugar mills and refineries last week to finalise purchase deals, officials said.
"Refiners have assured us that they would sell sugar at a rate lower than their mill-gate price," a member of the team told the FE.
Commerce ministry officials said they have planned to buy another 20,000 tonnes of soybean oil from local refiners, ignoring the tendering process to save time and money needed to process bidding documents.
"Local refiners are interested to sell the amount of soybean at a rate lower than mill-gate price," said an official.
The ministry has also decided to procure 2,000 tonnes of lentil from local source and another 1,000 tonnes from foreign source. It has also plans to buy a more than a thousand tones chickpeas from local and foreign markets.
"Our aim is plain and simple: to build a buffer stock for food items ahead of Ramadan. If we follow the tendering process, the purchase could be delayed, which will obviously be capitalised by the private traders," said the official.
"Tendering eats up some precious time, which neither the government nor the consumers can afford," he added.