Rice export vs import

Allowing import and export of rice, that too simultaneously, poses a difficult question for many seeking a satisfying answer. Officials of the ministry of food are reported as saying that the country has more than what it is to have as buffer, and so there is nothing wrong in exporting. Well taken. But what about importing? It would not have mattered if the issues could be delinked with no influence of one on the other. It is here that one fails to reason out the state-level activity regarding exporting.
The paradox is evident from the fact that while import of rice reportedly increased by around 300 per cent to $63.59 million in November 2014 from $16.07 million in the same month a year ago, the government has started to export rice to Sri Lanka and is almost set to export to India as well.
According to Bangladesh Bank (BB) data, apart from the increasing import of rice in November, letters of credit worth $59.81 million were opened in the month for more import of the food grains. As part of the contract for export of 50,000 tonnes of rice to Sri Lanka, the government, in two phases, has already shipped out 25,000 tonnes. According to the ministry of food sources, the government is presently working on an Indian proposal for export of 30,000 tonnes of rice.
The news of exporting rice, refreshing as it may sound in suggesting surplus production, is not at all in harmony with the news of increasing imports. The country imported 458,000 tonnes of rice during July and end-December of the current fiscal (2014-15) as against 374,000 tonnes in the whole of the previous fiscal. The imported rice is of the low-end, coarse variety, and one rationale could be to stockpile this variety for consumption of the low-income groups. Now, the critical question: is there any dearth of the coarse variety in the country? If no, the imported shipments are sure to dampen the domestic rice market, which it has already done. Even if the answer is yes, has there been a survey of sorts to quantify the volume? In all considerations, it appears that there is little that the authorities can stick to in justifying the act.
The Bangladesh rice merchant's association told the media that there was no urgency to import the coarse variety as domestic production was in surplus. They have alleged that their appeals to stop rice import have not been heeded to at all, and as a fall-out, domestic trading has been affected badly. Import cost of the coarse variety from India is Tk 26-Tk 26.50 and is being retailed at Tk 28-Tk 29 a kg, while the equivalent local variety is selling at Tk 30-Tk 31 a kg. What is more worrisome is that farmers who are always at odds with the price of rice might feel the pinch severely. While traders may use imports as a pretext not to offer fair prices, the farmers too may feel depressed at the less than expected prices due to imports.