Contract signed to purchase 5 lakh MT rice from India

The government yesterday signed a contract with India to buy 5 lakh tonnes of rice hours after it approved a proposal to that end.
In another development, local traders began importing rice through Benapole land port yesterday evening as India withdrew the embargo on rice export imposed on February 8.
The same day, in response to a proposal from Dhaka, Myanmar agreed to consider exporting 3 lakh tonnes of rice to Bangladesh every year, said a foreign ministry press release.
Meanwhile, local markets witnessed a rise in prices of coarse rice by Tk 1 a kg yesterday as the upward trend following the Indian ban continued.
Director General of the Directorate of Food Molla Waheeduzzaman, now in Kolkata leading a delegation, signed the contract with West Bengal Essential Commodities Supplies Cooperative Ltd for buying the 5 lakh tonnes of rice, said food ministry sources.
Earlier in the day, Finance Adviser Mirza Azizul Islam said, "Import of 5 lakh tonnes of rice from India under a state-to-state agreement will be completed within 75 days of the signing of the contract."
He was talking to reporters after meetings of advisory committees on purchase and economic affairs.
The Advisory Committee on Purchase decided to procure 67,000 tonnes of rice from local importers at a cost of around Tk 200 crore.
It also approved import of 3.90 lakh tonnes of fuel from the United Arab Emirates (UAE).
The decision to import refined petroleum from the UAE, a new source of fuel for Bangladesh, was taken to ensure smooth supply of diesel to farmers for irrigation during the ongoing winter crops cultivation, meeting sources said.
The Advisory Committee on Economic Affairs approved the proposal of the energy ministry for the import of fuel without any tender, also to take place under a state-to-state deal.
"The Bangladesh Petroleum Corporation has estimated that the cost of 3.90 lakh tonnes of refined petroleum is Tk 2,082 crore," a meeting source said. Of the fuel, 3.30 lakh tonnes are diesel.
Earlier, the purchase committee approved the food ministry proposal to purchase 5.67 lakh tonnes of rice at a cost of Tk 1,596 crore.
Talking to the reporters, Mirza Aziz hoped that the import of rice from India would help boost the government stock.
As per the approved proposal, 5 lakh tonnes of rice would be imported from India at the cost of Tk 1,396 crore.
Average purchase rate of the rice has been fixed at $399 per tonne. Starting from this month, the shipments will reach the country in phases by road, sea, river ways and railways.
As per the proposal, this bulk import would take place without any tendering process as there is an agreement signed between the two governments to this effect, officials said.
In addition, the government will procure 25,000 tonnes of rice from a local importer at the cost of $402 per tonne and another 42,000 tonnes from 13 importers at the cost of $420-$430 per tonne.
The purchase committee also approved two other proposals placed by the industries ministry for importing a total of 20,000 tonnes of phosphoric acid for two BCIC (Bangladesh Chemical Industries Corporation) fertiliser factories in Chittagong at the cost of Tk 102 crore.
The local traders heaved a sigh of relief following the withdrawal of the ban on rice export by the Indian government yesterday.
Customs authorities at Benapole and Indian Petrapole check posts issued 52 gate passes for shipments of rice. Until evening, a total of 280 tonnes rice entered through the Benapole land port.
India however put a condition that rice export is allowed only for those who opened letters of credit (L/C) at over $500 per tonne, reported a correspondent from Benapole.
According to an order of India's Director General of Foreign Trade, the L/Cs opened at below $500 has been cancelled making uncertain the fate of import of 12,000 tonnes rice, as L/Cs for the quantity has been opened at $390 per tonne.
The Indian government took the decision after holding a meeting with exporters' association yesterday.
In the wholesale markets in Bangladesh, prices of both local and Indian varieties of rice shot up by Tk 50 to Tk 200 per maund following India's embargo on rice export.
Coarse rice was selling in retail markets at Tk 30 to Tk 32 per kg yesterday against Tk 28 to Tk 29 just a week back.
Wholesalers at Karwan Bazar said price of each maund was Tk 3,440 last week, but it was Tk 3,620 yesterday, with an increase by Tk 5 per kg.
Many retailers believe that the price hike is a result of artificial crisis created by importers and distributors.
Meanwhile, Myanmar said it would consider exporting rice to Bangladesh since it has a surplus, says a foreign ministry press release on the 3rd Foreign Office Consultations between the two countries yesterday.
Foreign Secretary Touhid Hossain led the Bangladesh delegation while Myanmar Deputy Minister for Foreign Affairs Kyaw Thu led his side during the talks in the Myanmarese capital Nay Pyi Taw.
At the meeting, the Myanmar foreign minister said that his country has one million tonnes of surplus rice for export per annum and exporting 3 lakh tonnes of rice to Bangladesh on regular basis should not be a problem, the press release added.