Soaring rice prices affect people’s savings: Muhith

Finance Minister AMA Muhith said Sunday the soaring rice prices certainly put people into problems, as the spike erodes their savings.
"There is no doubt that a significant rise in the rice prices has certainly created problems for some people as the price spirals have affected their savings," said the finance minister.
Mr. Muhith made it clear that the government, out of goodwill, had a plan to extend price support to the farmers but that ultimately did the disservice through the market waywardness.
"We wanted some hike in the rice prices for farmers' benefit. But the situation worsened when the prices of rice (course rice) exceeded Tk 50 per kg," he said at Grameen Bank's dividend-handover event at his secretariat office.
The finance minister's observations came when his attention was drawn to a recent study report of private think-tank South Asian Network on Economic Modeling (SANEM) that over 0.52 million people joined the caravan of poor over the past few months following the hike in rice prices alone.
In the report the SANEM said a significant number of people had gone below the poverty line as the rice prices marked an average 30 per cent rise in the last few months, which resulted in increase in the rate of poverty by 32 percentage points.
Mr. Muhith, however, said such 'immediate' study reports should not be trusted because at least one year is needed to assess as to whether the number of poor has increased or decreased in the country following the rice-price rises.
"I don't know what would actually happen at the end of the year," said the finance minister.
About the GB, which had gone through raucous management change, Mr. Muhith said previously it was a 'no-profit' bank as subsidy was required to finance the microcredit operations. But now it is making profit as its clients take credits for enterprises, which is an important indicator of social change in Bangladesh.
"Now, the characteristics of Grammen Bank have been changed," he told reporters.
When asked, the finance minister said election to BG's board of directors will be held shortly as the schedule has already been made.
He also said a series of cases filed by Dr Mohammad Yunus, the founder and former managing director of the GB, and his followers delayed the process of holding the election.
"Dr. Yunus and his followers are experts in filing cases," said the finance minister.
However, Managing Director of the Grameen Bank Ratan Kumar Nag handed over a cheque for Tk 61.74 million as dividend for the year 2016 to the finance minister during the programme.
In 2015, the GB paid Tk 58.35 million as dividend into government exchequer.

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