Spiralling prices

Obviously, market supervision and monitoring could be conducted without disrupting the free market forces. Such activities are all the more necessary in a setting where there is no regulatory body to protect the interests of consumers.

The consumers have to bear the brunt of unexpected upward refixing of prices by traders. It usually takes place before religious festivals, the month of Ramadan in particular, when the demand for certain commodities rise appreciably.

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It seems speculators and hoarders have taken over, as the crisis is being described as an artificial one. The very fact that the government had to intervene shows that something has gone awfully wrong.

But we cannot forget that allowing the market forces to be in full play is something that free market economy is all about. The open market mechanism by and large worked well for us as productivity and imports kept supplies at a steady level, and there was equilibrium between demand and supply.

But the distortions that we witness now indicate that there is a chink in the panoply of market forces. Speculators and hoarders have made their way into the heart of the system, upsetting the demand-supply equation.

Consumers are left in the lurch since there is no regulatory commission to control price and quality of commodities. Such a body has to be constituted not to control market but to act as a watchdog against deviations and distortions. Similarly, the law that will protect the rights of consumers must be enacted without wasting any more time.

The intervention that the government deemed unavoidable has its pitfalls, too. In the past, we saw how prices rose further when attempts were made to control them. The solution, we believe, lies in initiating a consultative process between the government and the business community. Its focus should be on elimination of the disruptive and manipulative forces so that free market mechanism can work to the best advantage of consumers.