Price cap is not working

The price cap on 29 commodities exists on paper only as most of those items are being sold at prices higher than those fixed by the government.

Visiting Karwan Bazar, Kochukhet, Ibrahimpur and Mirpur-14 kitchen markets in Dhaka yesterday, The Daily Star found that traders were selling the essentials at the previously hiked prices.

Grass peas were being sold for Tk 130-140 a kg against the government-fixed rate of Tk 92.61.

Vegetables like cabbage, cauliflower, beans, aubergine, green chillies, tomatoes, and pumpkin sold at prices higher by Tk 10 to 40 per kg than the government-fixed rates.

Some retailers yesterday claimed they were unaware of the latest price capping, while others opined that this move will not work unless the supply of essentials picks up. They said they cannot cut the prices as the wholesalers charge them higher rates.

"The prices fixed by the government are much lower than our purchase prices from wholesalers. If the government can cut the wholesale prices of commodities, then we will be able to sell those at the government-fixed rates," Md Gofran, owner of a grocery shop at Karwan Bazar, told The Daily Star.

This means the government's move to rein in the commodity prices fall flat again.

Earlier on September 14 last year, the government fixed the prices of eggs, onions and potatoes after the prices of these essentials shot up. However, the authorities concerned could not enforce the price cap despite raids by different government agencies in different wholesale and retail markets.

Latest, the Department of Agricultural Marketing (DAM) on Friday fixed prices of 29 commodities from producer to consumer level. A day after the decision, most of the essentials were selling at a much higher prices.

The government fixed the price of goat meat at Tk 1003.56 per kg, but the item was sold for Tk 1,050 yesterday.

Chicken (Sonali) was sold for Tk 320-330 a kg, up from Tk 262 fixed by the DAM.

Prices of different varieties of pulses, including red lentils, moong, and mashkalai, were Tk 5 to 35 higher than the cap prices.

Of the 29 items, only eggs and katla fish were sold at the government-fixed rates -- Tk 10-10.50 per egg and Tk 300-400 per kg of katla fish.

Traders, however, said prices of these two commodities had been unchanged for three to four days before the government fixed their rates.

Amid such a situation, the people from limited- and low-income families are struggling to cope with the rising prices of essentials.

Many consumers say fixing the prices of essentials never worked before and it will not work in future either.

"It's nothing but a farce. I heard that the prices of 29 commodities have been fixed but I know the prices would not be effective," Abul Hossen, a consumer, told this newspaper at Kochukhet Bazar.

SM Nazir Hossain, vice-president of the Consumers Association of Bangladesh, said the government had capped prices on some daily essentials before, but those were hardly enforced.

"The authorities just fixed the prices and didn't take measures to enforce those. Price capping should be done considering the actual market situation. The authorities concerned should sit with the traders, NBR and other stakeholders to find a solution and give some relief to consumers," he added.