Aziz admits food inflation effects on poor

Finance Adviser Mirza Azizul Islam has admitted that food inflation has affected the lives of ordinary people.
Terming the inflationary trend a global phenomenon, he said lower food production in the preceding fiscal year coupled with the price hike of food grains on the international market pushed inflation higher.
”We have to bear in mind that there exists a high inflationary trend across the world, including our neighbouring countries," Mirza Aziz said in his budget speech yesterday.
Inflation reached double digits in July 2007 and remained at 11.6 percent in December the same year.
Mirza Aziz, however, said inflation rate is witnessing a slump in recent months.
According to the latest Bureau of Bangladesh Statistics data, point-to-point inflation rate came down to 7.66 percent in April from 10.06 percent in March 2008.
The adviser said the government has been taking both short- and medium-term measures to curb inflation.
He said: "Short-term measures included 'Dal-Bhat Programme' of BDR, open market sale of food grains at subsidised price, withdrawal of customs duty on the import of food grains and edible oil, increasing the amount of food grain imports, lowering of interest rate against import credit of food grains, regular monitoring of markets, and fixation of maximum retail price for edible oil."
He said medium-term measures include increase of production and distribution of food grains through creation of wholesale markets in various places including Dhaka, adding that initiatives have been taken to introduce Consumers' Rights Protection Ordinance.
To contain inflation, he said the Bangladesh Bank is pursuing a production-oriented and market-friendly monetary policy.
It is hoped that with the current bumper harvest coupled with the forecast of increased global food grain production by the second half of 2008, the average inflation would come down to 9.0 percent in the upcoming fiscal year, the adviser said.