Budget lacks steps to cool commodity prices

The lack of initiatives to bring down daily commodity prices in the proposed national budget for the fiscal year 2023-24 (FY24) have left consumers unsatisfied as they are struggling to survive amid soaring inflation.

The government has set a target to bring down the inflation rate from 9 per cent to 6 per cent in the next fiscal year, without specifying any measures, consumers said.

According to analysts, despite the fall in international fuel oil prices, it has not been adjusted in the country, which has resulted in a massive price increase of goods in the country.

Besides, a prolonged dollar crisis has made it even harder for Bangladeshi consumers to get a respite from skyrocketing price hikes. In addition, the country’s food security is at risk due to reduced subsidies in the agricultural sector, they said.

While placing the budget proposal in the Jatiya Sangsad on Thursday, Finance Minister AHM Mustafa Kamal said the government has set a target of bringing down inflation to 6 per cent.

The headline inflation ceiling for FY23 has been revised to 7.5 per cent.

However, according to provisional calculations of Bangladesh Bureau of Statistics (BBS), the rate of inflation in the current fiscal year was 8.4 per cent till April.

Inflation in Bangladesh had reached 9.52 per cent in August last year – the highest in over 11 years – due to rising commodity prices and record hikes in fuel prices.

In his budget speech, Kamal said, “Due to the decrease in the prices of fuel, food, and fertiliser in the global market, along with the adjustment of fuel prices in the domestic market and government initiatives to keep the food and supply systems normal, the inflation will remain much controlled in the next fiscal year and the annual average inflation is expected to stand at around 6 per cent.’

According to data released by the Trading Corporation of Bangladesh, TCB, Consumer Association of Bangladesh (CAB) and kitchen markets in the capital, the price of most of the essential food items, including rice, gram, oil, sugar, fish, meat, and vegetables have increased gradually in the last week.

Consumers are being forced to cut their food intake to cope with the pressure of increased expenses.

Compared year-on-year, the price of rice rose by 8–14 per cent, sugar 65 per cent, flour 19–29 per cent, gram 26 per cent, edible oil 9 per cent, meat 15 per cent, chicken 37 per cent, egg 21 per cent, milk 31 per cent, potato 74 per cent, onion 98 per cent, and ginger 175 per cent, shows TCB and kitchen market data.

In the meantime, CAB data reveals that the cost of living in Bangladesh increased by 10.08 per cent in 2022, compared to 6.92 per cent in the previous year.

Visiting the various kitchen markets of the Capital including Rampura, Mailbagh, and Maniknagar, this correspondent found out that a day after the budget, there is no sign of commodity prices dropping. Instead, in some markets, prices have actually gone up, some of them including rice, sugar, fish, egg and imported fruits have increased.

Talking to this correspondent at the Rampura kitchen market, Kowshik Ahmed, a private jobholder said, “After the price hike, I thought that this budget would have some measures to make the prices of import-dependent products like oil, sugar, pulses bearable.

“Instead, I saw the prices increasing. The budget did not bring any good news for the people.”