The establishment of the state-owned Trading Corporation of Bangladesh (TCB) in the mid seventies was inspired by the objective of providing relief to consumers who would otherwise suffer from aberrations in the prices of essential commodities from shortfall in their production or the mischief of their unscrupulous importers. But the TCB over the years started acquiring the unwanted characteristics of other state operated organizations such as corruption, overstaffing, etc.
However, the corporation continued on a profit track and in serving the consuming public reasonably well even well into the decade of the nineties from when its operations were gradually winded down as the governmental policy switched more to market economy principles with its emphasis on the least role of the state in import and distribution activities.
The TCB has been in a rather moribund state from that period. But it appears that the government has realized the need to reactivate this organization considerably as it becomes more and more clear that the practice of market economy without some form of governmental intervention, at least on different occasions or as the need arises, is not practical in the context of Bangladesh. Prices of good in everyday use have been rising without a pause over the last couple of years. The price rises seemed completely unjustifiable in many cases and could be traced to the actions of hoarders and profiteers and their manipulation in artificially causing the price hikes. Such unethical behavior is in no way compatible with the ideal market economy philosophy that maintains that fair competition between suppliers of goods or the right interactions between market forces would determine prices to the advantage of both consumers and sellers in the market. When this has not been happening in relation to many goods consumed by common people in the country, the ground then is created for the government to intervene in the market through some mechanism to straighten out the market distortions.
The TCB needs to be reactivated fully under a suitable plan and its neat execution. The commerce minster before the two recent Eid festivals declared that TCB would be fully operated. But not much was accomplished as TCB was found hardly prepared for the extensive marketing operations during the Eids. Therefore, what TCB needs is a real shot in the arm and not only ineffective promises which do not get backed up by appropriate actions.
Upward movement of prices or charges by a small amount may be bearable to consumers. But not when prices shoot up all on a sudden within a week’s time. For example, a basic cooking item, onion, is selling for Taka 60 per kg whereas its price was Taka 40 about a month ago. Surely, nothing could have happened so abruptly in the supply chain to justify such a development. Reportedly, there has been a bumper production of onions locally that should offset any pressure on the supply chain.
Even price of the basic staple, rice, is strangely moving up when the recent Boro rice harvest yielded the highest ever recorded amount. But the basic staple of the common man, coarse rice, increased by Taka one or two per kg rather quickly. This price spurt of rice, if it continues, will definitely add to hardships in the life of the likes of day labourers.
Already, similar tendency towards price spurts are noted in relation to other essential edibles like cooking oil, flour, lentils, etc. which could increase the costs of living of non affluent people. If the price of a good or service rises by, say, 2 or 3 per cent in a year’s time that should be bearable by common consumers. But not rises like 20 or 25 per cent in a two or three week period. So, what is at the root of it all ? Reliably, it was reported in the media that unjustified price rises are the handiwork of a section of businesses. They have formed syndicates to ensure that prices at retail level can be dictated and controlled by them. Needless to say, it is so important to bust these syndicates at the soonest to provide sustainable relief to common people. It is noted that officials from the Commerce Ministry now and then have meetings with business leaders and even fix prices of goods. But seldom such fixation works. Businesses, specially under syndicated conditions, act arbitrarily. Often the syndicate operators sell imported products at substantially increased prices when actually prices of the same in international markets have increased by a small margin.The budget document for 2021-22 spells out the philosophy of the government which is it seeks to boost ‘productive forces’ through various stimuluses to meet the needs of higher production and hence adequate availability of goods and services, creation of more jobs and more income and in this way to pave the ground for expansion of the taxation base to be able to garner greater amounts of revenues for the government to spend on developmental purposes. All of these goals read fine on paper . But the policy planners need to realize early in the day that this budget philosophy will deliver in a situation where the great many number of people who have been hard hit by the pandemic are actually cushioned from further erosion in their purchasing power by untamed rise in the prices of goods and services.
If they are too stressed out by an unregulated price situation, the same will not only prove politically unfavorable for the government. The same happening will also add to the liability of the government to provide for their bare sustenance. In this backdrop of deliberate man made price distortion of essential goods, full revival of the operation of TCB is certainly a fully justified welcome suggestion.
