International Business Forum of Bangladesh (IBFB) held a seminar on "Impact of syndicate and competition on price of essentials” at its office.
State Minister for Commerce Mr Ahsanul Islam Titu, MP joined the programme as the chief Chief Guest, while Senior Secretary to the Ministry of Commerce Mr Tapan Kanti Ghosh was the Special Guest. Professor at the Department of Economics, University of Dhaka Dr. Mohammad Helal Uddin Ahmed presented the Key Note paper while the IBFB President Mr. Humayun Rashid chaired and moderated the programme.
A member of Bangladesh Competition Commission Hafizur Rahman, Director General of the Directorate of National Consumers' Right Protection (DNCRP) Mr. A.H.M. Shafiquzzaman, Former Secretary to the Government and Chairman of NBR Dr. Muhammad Abdul Mazid, Legal Economist & the IBFB Vice President Mr. M.S. Siddiqui spoke on the occasion among others.
In his speech, chief guest Mr Ahsanul Islam Titu said there is no perfection with market definition. Different issues like natural calamities, pandemic and global conflict sometimes seriously disrupt the market. But when the government detects any unscrupulous behavior in the market, it takes necessary action.
Highlighting on the government’s role to support the affected people due to market volatility, he said the the government provides support to the poor through programs like TCB’s family card for 10 million families.
Regarding the current onion market he said the Indian embargo on onion export will not affect its deal with Bangladesh. As per the agreement to import 50,000 tonnes of Indian onion will gradually come to bangladesh. Our onion from India has already boarded on trains which will arrive by days- two or three through the Darshana route.
The keynote presenter Dr. Mohammad Helal Uddin Ahmed said there are huge allegations of market syndication while the government is trying to address them. Actually there are differences between price level and price fluctuations. As people's incomes are not increasing proportionately with price fluctuations, they are concerned with the price level changes.
He suggested an improved supply chain, proper storage of agriculture produce and agro processing, raising the scopes for digital transactions to help check market manipulation.
According to the keynote, the trends global food price index since 2000 revealed that it roughly tripled for the world, whereas it increased by five times for Bangladesh. That means the food price level changes are driven by macroeconomic phenomena in general.
Mr Tapan Kanti Ghosh said formalization of the market, measures to check market imperfections, and reducing information gaps are vital. He said steps like policing and price fixation actually don't work in market dynamics specially for agriculture produce.
Giving a highlight on the IBFB’s activities, its President Mr. Humayun Rashid said since many days it has become a tradition that prices of essentials increase during Ramadan. Prices of many items including sugar, soybean oil, rice, potato and dates have marked a significant rise in the last several years.
Identifying some challenges, he suggested controlling black money as invested in commodity market, prevention of extortion, improving supply chain, distribution system and ensuring strong coordination among the ministries concerned to help prevent syndication and stabilize market.
Member of Bangladesh Competition Commission Mr. Hafizur Rahman said all price hikes are not result of merely market syndication. Behind the price increase there are various reasons. There have been different changes in the country's taxation while the foreign currency exchange rates volatility has resulted in price hikes. The BCC has taken some actions against when it detected syndication or any malpractices to make the market unstable.
DNCRP's Shafiquzzaman said somehow some economic theories apparently don't work in Bangladesh’s commodity market. There is a strong need for educating consumer's behavior. Also data availability of the market demand and production of different commodities is vital.
Dr Abdul Mazid said there should be studies to gauge the impact of taxation on tax rate changes six months earlier to impose the tax. Despite tax increased, fruits are imported even though there are good sales of them indicating that there are capable consumers. Actually income inequality is now a big problem for the country.
Mr. MS Siddiqui said money supply, economic growth, exchange rate and syndication are some of the common factors for price hike. The concept of market economy is not flawless resulting in the wrong definition of syndication. He underscored the need for a deep dive into the country's market dynamics to determine the causes behind unusual market prices.
