Last measure against arbitrary price hike

Who says Bangladesh belongs to a globally interconnected world? To the country the global village is a misnomer and it is an isolated island so far as its commodity market is concerned. At a time when the World Bank (WB) reveals that commodity prices globally registered a 3.0 per cent drop, with lower prices of fertilizer, natural gas and coal influencing the decline, in the first quarter of 2024, Bangladesh market continues to be more volatile. The WB cites particularly the decrease in world food prices but on this count Bangladesh has an unenviable record diametrically opposed to the global position.
The latest surge in prices of commodities here is presumably linked to the combined effect of two decisions the Bangladesh has taken. One is further depreciation of Taka against dollar under the newly introduced crawling peg for exchange rate and the other is the market-driven banking interest rate. While the first one will certainly make imports costlier, this has no reason to impact the market overnight. In a country where prices of commodities are hiked on flimsy or even imaginary pretexts, the two moves are strong reasons for making market jittery. Let alone imported items, different varieties of locally grown agricultural produce, fish, egg and chicken have witnessed an abnormal surge in prices by Tk 10 to 50 a kilogram or per piece.
However, traders have their archaic argument in favour of pushing up prices of kitchen market items. They advance arguments that recent heat waves have caused damage to crops and a supply shortage is the reason behind price escalation. A visit to the market, however, does not corroborate their claim. Leave the more perishable items, what about potato and onion, the harvest of which are already over? Now that India has lifted restrictions on export of onion, the item's price should have at least stabilised if not gone down. Here traders' argument is quite intriguing. Indian onion will take time to arrive in the market and before that price cannot be reduced. In case of local kitchen items and imported essentials, the letters of credit are opened months before, prices go up overnight but when it comes to price fall in the international market, it never takes effect here immediately.
The more important question here is, do farmers or growers get a share of the artificially elevated profits? There is no reason they do because this market is repressed under the monopoly hold traders and a parasite class comprising middlemen and extortionists have established. Actually the extra costs on the supply chain in between growers and consumers explain the higher commodity prices in the abnormally managed market of Bangladesh. Business is not only mostly unethical but also defies the principle of demand and supply.
Binayak Sen, Director General, Bangladesh Institute of Development Studies (BIDS) lately told the media that food inflation has already hit 15 per cent. This latest round of price escalation might trigger even higher food inflation. The poor, lower and middle-income classes have been writhing in agony due to the outrageous prices of commodity, particularly food. Their agony is likely to intensify if floating exchange rate is introduced and the International Monetary Fund's (IMF's) prescription of withdrawal of subsidy from the power and energy sector followed soon. That will give business coteries yet another pretext to raise prices of commodities.
Now if the WB's projection on global commodity prices--- on top of that of the first quarter of this year--- is taken as a guide, prices will fall by 3.0 per cent in 2024 and by 4.0 per cent in 2025. Bangladesh is likely to be an anomaly if traders are allowed to continue with the market anarchy they have become accustomed to. Whether the government is powerless or a tacit accomplice to the ploy or not is anybody's guess. But the consumers, the majority of whom are bleeding because of market volatility, with their back to the wall have a potential weapon to apply. They can nationally boycott items of absurdly spiralled prices, targeting one by one. No one will buy a certain item unless or until the price is lowered to a reasonable level. Otherwise, traders may not mend their ways.

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