Price stability and political commitment
To bring down price, help the farmers. Photo: Shafiqul Islam Kajol/ Drik News
UNDOUBTEDLY, the most immediate task of the newly elected government would be to arrest the price spiral. Inflationary pressure left poor people impoverished for the last few years. And that has already been mentioned by the newly elected PM as well as her ministers in the cabinet. How to stabilise prices? There are many ways but I shall present only a few. As of now, the stock of food grains is estimated to be around 12-13 lakh tons, international oil price has nose-dived in the recent past, forex reserve is in comfortable condition, exports and remittances are going strong, amon production was not very badly affected this year, the exchange rate is stable, etc. Above all, the commitment of the party in power to lower food prices has already created a stir among the hoardersat household or business levelto release the surplus in the market. The price of rice has already begun to fall. The position is unlikely to change in the current year. I personally feel that price stability is more a matter of efficient -- management than anything else. The government sh4ould ensure that farmers get inputs on time and at reasonable prices (not at "no" prices) -- along with new technology to augment domestic supply. To this effect, pari passu election pledges of the party in power, the prices of imported non-urea fertilisers have been reduced to almost half, and diesel price has been reduced, albeit marginally, to positively affect farmers' returns. The next step is to ensure that inputs are delivered on time. That requires proper monitoring of the actors in the distribution chain and severe punishment of hoarders, irrespective of political affiliation. Stabilisation of prices requires three "C"s: commitment, competence and co-ordination. Commitment comes from the realisation that the people are supreme and should be served sensibly. Competence lies mostly with the bureaucracy and the evaluation and monitoring units in identifying bottlenecks and checks. Coordination implies regular contact between, say, the finance, agriculture and industry ministries in the case of subsidies, or between the commerce and agriculture ministries in the case of imported fertilisers. The more the cohesion, the better it is for the cost effective availability of inputs. The business community should receive the signal that most of the poor people voted for AL. It is the moral obligation of the present government to see that the level of prices should not pinch the poor. Again, with a downturn in the international spectrum, there is no reason why Bangladesh should not face a commensurate fall in prices. The question is not of replacing the market with the government but of making markets work smoothly without any resort to unholy alliances. If the market fails to deliver the desired goals, the public sector should immediately complement the supply chain. The present government has the advantage of its experience of managing the economy reasonably well during 1996-2000. That experience should serve as a foundation stone, coupled with a few innovative institutional arrangements in the face of a new economic order. But the bottom line is good governance: tough on business syndicates, extortion/terrorism and deteriorating law and order condition. This is the change we need. This is the poor man's desire. Given that the concerned ministries are headed by the right persons, I hope the desire can be fulfilled.
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