At a time when the government attempts are proving futile in bringing down the soaring rice price to a desirable level, it has been compelled to look beyond its border for help. Its latest approval of import of 0.25 million tonnes of more rice has rightly been viewed as a measure to cool down the overheated staple market. The measure also conforms to the free market economic theory --bringing parity between demand and supply. The authorities had to reverse its earlier stance of discouraging import of rice by raising import duty. When 28 per cent duty was imposed on rice import, the country faced a problem where paddy producing farmers counted loss because the production cost was higher than the market price of their produce. The syndicate of middlemen like millers and big rice traders, however, made sure that their profit margin was quite to their liking. Importers had no incentive in such a dull market.
It is then reversal in paddy growing in some parts of the country coupled with the food ministry's slumber not to notice the impending food crisis, prepared the ground for millers and stockists or hoarders to make the most of the situation. The food ministry now realised it was caught off guard and launched a drive against rice stockists in order to arrest the unabated price hike. The drive somehow contained further escalation of price but by that time the staple had broken all past records of rice price in the country. Even the coarse varieties of rice the lower middle class and poor people eat were selling at Tk 55 a kilogram at the minimum and Tk 58-60 a kilogram at the highest. Following negotiations with big rice traders and emergency import of rice from some neighbouring countries helped bring the price of coarse varieties down by Tk 2.0-3.0 initially and then by Tk 10-12. But still the price level is much higher than it was before the crisis. However, price of the fine varieties of rice has not come down, in some cases those have registered further rise.
Clearly, the government has prevailed on the rice traders but only marginally. Now the importers have also joined hands with the millers and hoarders in reaping dividends from an unstable market. The benefit of the duty relaxation is enjoyed by the importers themselves. The consumers in the lower bracket have some benefit to savour but not enough to feel completely relieved. Consumers of the categories just above them but lower than the top level do feel the pinch all the same. Once again some sections among the business class have demonstrated how they are ready to pounce on in order to outrageously maximise their profit -- misery of the downtrodden notwithstanding.
Had the authorities kept their antenna up, they could definitely stave off the crisis and the price escalation. When government silos were becoming depleted and the country experienced a major crop failure, it had to act promptly before the traders could take any undue advantage from the impending shortage of food production. There is no guarantee that the latest consignments of import will bring the prices of all varieties of rice further down. Most likely the traders will eat the cake and have it too. Much depends on how the imported rice will be made available at the market. If the supply outpaces demand, price will come down to the level where it was before the crisis. Consumers hope this to happen.