Home ›› 08 Aug 2022 ›› Front
The big rise in the costs of different services along with ever-increasing commodity prices has put people, especially the lower- and middle-income groups, in a tough spot.
Among others, transport costs, domestic workers’ wages, education and medical expenses, and house rents have gone up significantly.
Living costs started to increase after the outbreak of the Covid-19 pandemic, which was later aggravated by the ongoing Russia-Ukraine war.
The war disrupted the supply chain as well as created a crisis in the wheat and fuel markets across the globe as the belligerents are big suppliers of these items.
Being a part of the global economy, Bangladesh then had to increase gas, fuel, and edible oil prices.
As a domino effect, the cost of living went up sharply, resulting in high inflation, which reached 7.56 per cent in June, the highest in nine years.
Former cabinet secretary Ali Imam Majumder told The Business Post the costs of different services are interdependent.
“For example, electricity prices go up when fuel prices rise. Also, it is consumers who always bear the extra expenses,” he said.
He also said salaries could be increased to offset the effect if the prices of services could not be reduced.
“The pensions and salaries of government employees have to be increased. The minimum pay of private sector workers has to be raised as well.”
Daily services
Haircut and shaving costs have increased by Tk 10-20 in different salons in the capital.
Monir Hossain, a Dhaka resident, said the rickshaw fare was Tk 20 from Motijheel to Purana Paltan once upon a time, which increased to Tk 30 in the last one to two years.
“Now the cost has risen again by Tk 10. I need to spend Tk 40 to travel this distance now,” he said.
The minimum bus fare was increased to Tk 10 in November last year after a fuel price hike. Long-haul bus fares were also increased by Tk 0.38 per kilometre, which reached Tk 1.8. Besides, city bus fares were raised to Tk 2.15 per kilometre.
When people were still reeling from the fare hikes, the prices of all types of fuel were increased again on Friday by up to 51 per cent. This caused transport fares to go up again.
Transport owners increased fares by 16-22 per cent per kilometre for long-haul transports as well as those running in Dhaka and Chattogram metropolitan areas. Along with bus fares, other transport costs went up as well.
Jasim Uddin, who works at a private company, told The Business Post he used to pay Tk 123-125 to travel to Tejgaon from Mirpur 13 by a Pathao ride-sharing motorcycle till Friday. “On Sunday, I paid Tk 173.”
Waste management bills, domestic workers’ wages, and cable TV and newspaper subscription costs have also gone up.
Utility bills
The government increased gas prices at the consumer level by 22.78 per cent on average in June. A household pays Tk 990 for a one-burner stove and Tk 1,080 for a two-burner one while prepaid customers pay Tk 18 per unit (cubic metre) with a 43 per cent rise in costs.
Dhaka Water Supply and Sewerage Authority (WASA) raised household water tariffs twice in April 2020 and September 2021. After a 31 per cent increase, current WASA water tariffs stand at Tk 15.18 per 1,000 litres.
Prices are likely to increase again by 5 per cent from September 1 as per the decision made at a WASA board meeting in July. With this, water prices rose at least 15 times in the last 14 years.
House rent
Low-income people are seeing at least a Tk 500 annual rise in their house rents while it is up to Tk 2,000 for the middle class.
A 2021 report by the Consumers Association of Bangladesh said rents rose by 152 per cent in 11 years. In 2010, a 1,200sqft flat rent was Tk 11,300, which is now Tk 28,500.
Educational expenses
Manik Muntasir, a Khilgaon resident working at a private company, told The Business Post tuition fees at his third-grader son’s school rose by 10 per cent this year.
He said other costs had gone up as well. “A student neck tie price was Tk 40 last year, which is now Tk 70. A Tk 50 notebook now costs Tk 70-80. Besides, tiffin costs almost doubled, fuelled by the rising costs of consumer goods.”
Mobile expenses
In July, Grameenphone and other big mobile operators set the minimum balance recharge amount at Tk 20, which previously was Tk 10.
Mobile internet costs also rose. Mobile operators used to pay a 5 per cent VAT on internet services till June, which increased to 15 per cent from July 1.
Subscribers said they were paying 6-8 per cent more to buy mobile internet.
Medical costs
A Bangladesh National Health Accounts report said citizens used to pay 60 per cent of medical expenses in 2009 while government expenditures were 25 per cent. The rest used to be covered by non-governmental and other organisations as well as insurance companies.
In 2012, individual treatment spending increased to 63 per cent while government expenditure decreased to 23 per cent. In 2015, individual expenditure was 67 per cent and government expenses were 22.08 per cent.
In 2020, individual expenditure further rose to 68.05 per cent while government expenses were 23.03 per cent.
Insiders said medical expenses increased more in the last one year and a half due to the Covid-19 pandemic. Medicine and treatment equipment prices also saw a rise.
Last month, the prices of 20 generic drugs of 53 brands in the field of primary care were raised. Paracetamol prices rose by 50-100 per cent depending on power. Amoxicillin prices went up to Tk 70 from Tk 40. Some drug prices rose by 99-132 per cent.
