New policy set to scrap all existing sugar dealerships
Sunday, 14 March 2010
Doulot Akter Mala
The government is set to scrap all existing state-appointed sugar dealerships in an effort to combat price manipulation of the food item by a cartel of rogue traders, officials said.
The new measure has been rolled out in a draft sugar sale and marketing policy, expected to be adopted by the industries ministry next week to streamline nationwide of the sweetener.
Under the policy, all state-appointed sugar distributors in the country's six big cities, 64 district towns and more than 500 sub-districts and municipalities would be replaced by a new set of "clean" dealers.
The move comes amid repeated failures by the government agencies to control prices of sugar despite the market has been awash with enough supply of the food item.
Officials said they have found big price fluctuations of sugar across the country recently, especially during the holy month of Ramadan, raising questions about the role being played by the state dealers.
"There is no way we can control abnormal price hike of sugar if the existing distribution system of the food item is not replaced by a more efficient and cleaner one," said an official who is familiar with the new sugar policy.
Under the new policy, the government will appoint 1,200 area-based 'sugar distributors' who have to deposit Tk 0.1 million each to the Bangladesh Sugar and Food Industry Corporation (BSFIC) for their permits.
Each sub-district will have two distributors while the capital Dhaka will have 90, Rajshahi Khulna and Barisal cities 30 each, Sylhet 27, Chittagong 41.
The new policy will require the distributors to drop fresh applications for procurement of sugar from the state-owned producer, BSFIC.
The policy will also cancel the existing dealership system of the Trading Corporation of Bangladesh (TCB) - the government-owned food and foodgrains importer and distributor.
Distributors will procure sugar at a rates fixed by the government. They will not be allowed to sell one tonne of sugar Tk 1000 more than its mill-gate price.
"Distributors have to procure and sell sugar in time. Hoarding will be restricted," the policy said.
The corporation will impose hefty fine on a dealer if he fails to procure sugar from mills within the government-fixed time-frame, it said.
A dealer will lose his license if he fails to procure sugar from the government at least three times and if he is found to have unholy alliance with factories producing molasses illegally.
"Distributors have to keep all data of sugar procurement and sale so that the authorities can examine them at any time," it said.
The BSFIC will be allowed to sell sugar directly in order keep its liquidity position stable in case its stocks remained unsold.
The government is set to scrap all existing state-appointed sugar dealerships in an effort to combat price manipulation of the food item by a cartel of rogue traders, officials said.
The new measure has been rolled out in a draft sugar sale and marketing policy, expected to be adopted by the industries ministry next week to streamline nationwide of the sweetener.
Under the policy, all state-appointed sugar distributors in the country's six big cities, 64 district towns and more than 500 sub-districts and municipalities would be replaced by a new set of "clean" dealers.
The move comes amid repeated failures by the government agencies to control prices of sugar despite the market has been awash with enough supply of the food item.
Officials said they have found big price fluctuations of sugar across the country recently, especially during the holy month of Ramadan, raising questions about the role being played by the state dealers.
"There is no way we can control abnormal price hike of sugar if the existing distribution system of the food item is not replaced by a more efficient and cleaner one," said an official who is familiar with the new sugar policy.
Under the new policy, the government will appoint 1,200 area-based 'sugar distributors' who have to deposit Tk 0.1 million each to the Bangladesh Sugar and Food Industry Corporation (BSFIC) for their permits.
Each sub-district will have two distributors while the capital Dhaka will have 90, Rajshahi Khulna and Barisal cities 30 each, Sylhet 27, Chittagong 41.
The new policy will require the distributors to drop fresh applications for procurement of sugar from the state-owned producer, BSFIC.
The policy will also cancel the existing dealership system of the Trading Corporation of Bangladesh (TCB) - the government-owned food and foodgrains importer and distributor.
Distributors will procure sugar at a rates fixed by the government. They will not be allowed to sell one tonne of sugar Tk 1000 more than its mill-gate price.
"Distributors have to procure and sell sugar in time. Hoarding will be restricted," the policy said.
The corporation will impose hefty fine on a dealer if he fails to procure sugar from mills within the government-fixed time-frame, it said.
A dealer will lose his license if he fails to procure sugar from the government at least three times and if he is found to have unholy alliance with factories producing molasses illegally.
"Distributors have to keep all data of sugar procurement and sale so that the authorities can examine them at any time," it said.
The BSFIC will be allowed to sell sugar directly in order keep its liquidity position stable in case its stocks remained unsold.