No one knows better the excruciating pain of balancing budgets than governments and the individual citizen. Governance has a much wider canvas whereby the various dichotomies require shrewd handling between slack and reign. In an ideal world, there would be a mid-point where reasonable business, profits and consideration of expenses would meet. For all the uses of the cliche, there is no win/win situation. A combination of resignation and acceptance of reality is what emerges. Invariably, for the best laid out plans, there will be the spanner in the works at times man-made or induced by the unfailing leveller nature.
As the machinery coughs and grinds to a halt innumerable debates emanate to get a grip of situations and suggested fixes. That might appeal to the senses and conscience but rarely comes to terms with the interconnected economy as it is. The World Food Programme's (WFP) forecast of food shortages some ten years ago either got lost in the rigmarole of conveniences and glitzy new phenomenon or was simply ignored. The price is being paid. Prices are up by 10 per cent and connected sectors will also increase costs.
Nonetheless, the recent upward spiral of essential food items has left consumers bewildered and government red-faced. With no natural spanner's at work the country has proudly positioned its mainly agricultural and fishery sectors at enviable world rankings in terms of production. The euphoria ends there. Higher production helps to meet increased demands and, hopefully leave a tidy portion aside for export. What hasn't been as carefully planned is the price to farmers. Last year, the governments internal stockpile targets of rice missed the target significantly simply due to unattractive prices. Thrice extended timeframes didn't work. Nor did the special arrangements to transport harvesting labour during pandemic lockdowns.
The beneficiary inevitably was the miller and middle-man. They invested in hoarding and the pinch is now being felt. A ban on exports, encouraging imports through slashing duties haven't worked and were akin to looking for needles in haystacks. International prices is one reason why importers were reluctant. The overall greed for windfall gains ruled prime. Farmers were hit hard during vegetable production season both summer and winter last year. The inadequacy of efficiency and ability of government transportation and bottlenecks in local collection led to rotting produce and sakes at abysmal rates. Lopsided stimulus packages and deplorable distribution of farm and hatchery packages resulted in underreported culling of chicken and chicks. Many went out of business. The expected but ignored impact is kicking in.There was little monitoring of banking channels and lesser focus on disbursement through banks that could have censured more efficient usage. Innovative thinking didn't sink in. Private companies with reputed agri connectivity such as the tobacco industry, local cooking oil, potato snacks, fish exporters and do on were not tasked with the responsibility of getting stimulus to the right people, at the right time. Instead it was left to bumbling bureaucracy that in the best of time find it difficult to get off their esteemed perches.
Fifty years ago the concept of rural cooperatives had been conceived. They were never set upon order that the 'middle supply chain' operated usually by local political elements or controlled by them, continued to flourish.
The high prices, already having absorbed the usual cost of doing business in terms of route/extortion and bribery, have been hit further by the middleman profiteering. Sooner than later, as the new grain crop is gathered in, there will be a sudden dumping of stock. In both cases garners have or will be lost. In the cities, prices are already breaking family budgets. The mindless, unplanned hike in diesel prices will do much more damage than just raise fares abnormally. The impact on food product prices will soar and be multiplied. At a time when a reported 35 million have been pushed into the poverty grid, such goings on will ad insult to injury. 10 percentages of the 35 million won't be returning to the cities anytime soon. That's a further pressure on the rural economy.
There's opportunity in adversity. Special incentives to encourage SME and even big industry setups in more rural settings will create jobs and reduce the pressure on commodities provided there is thought through monitoring and coaching. Involving the private sector and using their expertise will add feathers of the government hat, not take anything away. For the moment, interest free consumer loans with only processing cost is what the tottering middle class needs. It worked in Australia to boost spending with no strings attached in 2008. Bangladesh might not have such a luxury. It's still better use of money than what was frittered away abroad. And government coffers fill up when people spend.
