Bitter Truth
Low-income groups cry for relief
IN spite of the pledges of dalbhat that the alliance government made in its election manifesto in 2001, the grand plan remained an illusion. Bad economics and ill-governance have contributed to recurring crises, which the country now continues to pay through people's suffering under the years of spiralling prices of essentials.
Even when there were indications by experts that the country would face a shortage of 20-25 lakh metric tons of rice as early as last November because of two devastating floods and Cyclone Sidr, there was hardly any attempt to meet the shortfall by importing rice or by any other means. And when the crisis was most evident, in the late January, international price of rice had shot up, and the government action to import five lakh metric tones of rice from India has faced serious hurdles at different stages.
Sadly true, policy actions and market control mechanisms are still traditional and primitive. Ordinarily, the fires of price escalation are doused through government intervention, for which a buffer stock is needed. Evidently the most crucial factor for such a venture to be successful comes from proper storage of food grains.
Undeniably true, the people and the government have to contend with the fact that in the event of a shortfall of production of an agricultural commodity that is linked to people's bare subsistence, panic or rumour mongering by big businesses takes priority over the law of supply and demand. With the fall in supply and shrinkage of arable area, there is a chance that speculation may drive up the price along all the hands the commodity passes through. This is not an unfamiliar situation, and a careful administration must guard against it.
Pathetically true, the agencies concerned in the country were not fully alive to the situation that had spread its root much earlier. When the situation went somewhat out of control, the CTG deployed BDR to start OMS of rice and flour, and the TCB to import rice. Evidently, when there is shortage of any commodity and the price goes up in the international market, private importers would be most reluctant to take any risk of loss due to price fluctuation.
In the case of rice as well as edible oil and lentils, prices went beyond the purchasing capacity of the ordinary people, and the government should have allowed the private importers to import these commodities by offering zero margin L/C, lower rate of interest on bank loans, and exemption of import duty, VAT and any form of tax, along with ensuring quick delivery from the land and sea ports.
Evidently, people are the most vital constituency of any government, and if they suffer for lack of food the entire purpose of the administration would be set at naught.
Fixed income groups, such as retired employees of either government or autonomous organisations and employees of the private firms find themselves in a bind because of the price hikes. In this country of 140 million people, the proposed pay hikes would benefit only the 12 lakh people in government and autonomous organisations, but the effect of the pay hike would affect the vast multitude of people.
With prices of daily essentials soaring every day, Delwar Hossain, a retired government employee with a family of four, faces a gruelling battle with a small monthly pension and the pension benefit he has put in the post office under pensioner's scheme. He is now in a double quandary. One of his family members has fallen sick, needing huge expenses in medical treatment every month. He lives in a rented house in Madartek in the city.
With spiralling rise in the price of rice, flour and edible oil, he has already trimmed his family expenditure, but now things have come to such a pass that he just cannot survive. He is now looking for other options like private tuition to meet the bare needs of his family. Shockingly, parents and affluent guardians would not put their children under his care because of his age and lack of experience in teaching.
The hardship the low-income group is passing through beggars any description. During my last visit to Satkhira, a rickshaw puller narrated his predicament in running his family of six members. He needs at least Tk. 150 daily for food for the family. But his daily earning after paying the rent of the rickshaw never reaches that ceiling.
In the meantime, he has arranged the wedding of his eldest daughter, who was to appear in the SSC examination this year, by negotiating a dowry demand of Tk 10,000 that his wife received as loan from an NGO operating in his village, with repayment undertaking of Tk 250 every week to be paid up in 52 weekly instalments. His daughter's education plan was shelved, and his family has now landed in further distress.
Mahmudul Kabir, who is a deputy secretary and lives in a government quarter, is worried too. He has a hard time meeting the educational expenses of his three school and college going children even after drastically trimming the family budget on food expenses. "Living expenditures are shooting up every day and saving opportunities are vanishing," he laments. From Tetulia to Teknaf, people belonging to lower and fixed income groups are discontented over the soaring prices of food items. They cannot find any work and evidently have no earning.
With prices of coarse rice, pulses and edible oil going up by about 70 percent over the last 12 months, according to a report by the BIDS, the middle class with fixed income, and the low-income group, find themselves in a bind. With the government taking measures in expanding open market sales (OMS), increasing the vulnerable group feeding (VGF), and starting new food for work programmes at lightning speed, there could be some relief for the populace. If the government declares pay hike to the employees serving in government and autonomous organisations, there is apprehension of the market becoming unstable again, and the inflation that now hovers around 11.5 per-cent would rise further. As experts say, inflation is an indirect tax, and hurts the poor most. Inflation erodes savings and keeps interest rate high. As such, the government has to be very cautious about market monitoring before making any announcement about pay hike.
Unhappily, every crisis in the country brings about a spate of reform proposals that are laid down on paper and never implemented. The problem with the policy-making bodies is that there is endless debate as long as the crisis lasts. The government goes back to "business as usual" mode as when either prices or problems even out. Precisely true, food security is not an issue that a nation of 140 million people, totally dependent on rice and pulses, can take lightly.
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