Govt failure to contain market may have made rice millers bold: CAB

Consumers Association of Bangladesh (CAB) yesterday said price of onion would not have reached an exorbitant level had the government taken initiatives to directly import the key cooking ingredient in October to increase supply.

The non-government consumer rights body said the government took various initiatives to increase supply of onion in the domestic market and arrest the price spiral after India banned exports on September 29.

Yet, the steps -- easing requirement for advance payment to open letters of credit for onion import, requesting big businesses to import the daily essential and selling it through Trading Corporation of Bangladesh (TCB) trucks at subsidised prices -- could not contain the price hike, said CAB.

“TCB is selling onions by purchasing from the domestic market. Overall, the supply situation has not improved,” said CAB President Ghulam Rahman at a press conference at Jatiya Press Club in Dhaka.

Onions are used mainly as spice to prepare traditional dishes and its prices hit an all-time high of Tk 250 per kg in the third week of this month amid a supply shortage.

CAB said Bangladesh requires nearly 30 lakh tonnes of onions annually, and the nation does not produce enough to meet the demand.

Rahman said supply shortage is the main reason behind onion price spiral.

He said government expected that businesses would respond promptly to import and increase supply of onions in the market.

“That response did not come... a section of high-profit seeking traders spiked prices of onion by taking advantage of the crisis,” he said.

The consumer rights body also expressed concerns over recent price hike of rice, flour, soybean oil and lentil.

It demanded formation of a consumers affairs ministry or establishment of a separate division at the commerce ministry to protect consumers’ rights.

“Consumers are the biggest economic group in the country. Yet, they are often ignored during decisions on issues impacting them,” he said.

Under the circumstances, CAB said, creation of a consumers’ affairs ministry is need of the hour.

CAB suggested selection of 15-20 essential commodities and said the proposed ministry should be assigned to ensure satisfactory supply of these commodities to keep prices stable, so that cost of living remains within tolerable levels.

Rahman said the commerce ministry is trying to protect interests of consumers.

“But it is not possible for the commerce ministry to look after everything,” he said. 

Various other ministries such as food, agriculture, livestock, industries, telecommunication and finance are also linked to consumers’ issues. A separate ministry is needed to coordinate with all the ministries to protect consumers’ interests, he added.

CAB placed the demand at a time when spiralling prices of various essentials, including rice, within a short period squeezed wallets of many, reducing purchasing capacity of poor and low-income people.

CAB said prices of rice have been going up for the last one month.

It also claimed that the government’s failure to contain the onion market may have made rice millers “bold”. It demanded the government control any “ill-motive” to make the rice market unstable with a strong hand.

The consumers’ rights body demanded regular market monitoring to keep prices of essentials stable, and making activities of Bangladesh Competition Commission visible to ensure competitive pricing.

CAB suggested taking diplomatic initiative so that India lifts ban on onion exports. It also recommended imposing 10-20 percent duty on onion imports during the peak harvesting season, so that growers get fair prices and cultivate more onion the following year -- enabling the country to attain self-sufficiency in onion production.