Extortion, syndicate, dollar crisis behind price hike

The prices of daily essentials have increased in another phase ahead of the holy month of Ramadan. The businesspersons have identified four reasons behind this rise in the prices of daily essentials – high price and crisis of dollars, extortion, syndicate and high tariff rate.

Common traders involved in the business of daily essentials said this in a meeting to exchange views on ‘production, import, stock, supply and prices of daily essentials during Ramadan’ organised by the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) Wednesday.

However, FBCCI president Mahbubul Alam reminded the traders about their own ‘responsibilities’ in containing the price hike. It is said in the end of the day that businesspersons make extra profits, he added.

Mahbubul thought that the businesspersons will have to change their mentality to come out of the tendency of making extra benefit and stockpiling.

The businesspersons pointed out four reasons behind the rise in the prices of daily essentials. They said dollars were not being sold at stipulated prices. Commercial banks are pricing dollars ‘arbitrarily’. As a result, the import cost has risen. In addition to that, extortion at different levels, including transportation, is also responsible behind the price hike. The prices of broiler chicken and beef are not coming down due to syndicates. And the prices of sugar and dates have skyrocketed due to the high tariff rate.

FBBCI president Mahbubul Alam presided over the meeting held at the FBCCI Icon building on Wednesday.

Representatives of large companies, wholesale and retail traders affiliated with consumer’s product business, leaders of different market committees in Dhaka and officials of different government organisations and agencies, including the Bangladesh Bank and Bangladesh Competition Commission were present at the meeting.

Some of them expressed concerns that prices of several daily essentials like broiler chicken, beef and onions will further rise if actions are not taken immediately.

FBCCI president Mahbubul Alam said, “It’s true that we have to run business amid different challenges. But what we have to do now is keep the market stable. None of us should take extra prices from the customers. Let’s make a fair profit in the holy month of Ramadan. The prime minister is quite cautious about this. You too have to be cautious.”

Speaking regarding the allegations of extortion, Mahbubul Alam, “Please let us know in case if you had to pay extortion during transportation and loading or unloading products. The extortionist won’t be spared. We will talk to the top level of the government if needed to solve the problem.”

Speaking to Prothom Alo regarding the allegations brought up by the businesspersons in the meeting, the FBCCI president said, “There have always been challenges to do business in Bangladesh. It’s nothing new. I don’t want the traders to incur losses either. We have told them that you have to make profit as businesspersons, but that must be rational. Besides, they should not create any artificial crisis in the market.”

Several businesspersons in the meeting alleged that already prices of some products have gone up in the market.

Expressing his discontent over the rise in the prices of broiler chicken, beef and onions, Bangladesh Restaurant Owners Association general secretary Imran Hasan said the price of broiler chicken rose to Tk 200 within the last 15 days. They are assuming that people will have to buy broiler chicken at Tk 250 – Tk 230 during the Ramadan like the previous year. Prices of spices also have gone up, Imran Hasan said.

He said, “Some business leaders control the spice market. Please don’t manipulate the spice market.”

He further said, “Onions are one of the key ingredients in restaurant business. Onion prices have been high for a long time.”

He suggested importing onions from countries other than India saying Bangladesh should not be over-dependent on India in this regard.

Shyambazar Onion Traders Association general secretary Md Abdul Majed said, “We have been struggling since India imposed a ban on onion export. We are not being able to curb the price. The stock of 'murikata' onion (early variety) is already finished. The 'hali' onions (that comes to the market later) will be in the market very soon, which will reduce the onion price during the Ramadan.”

Onion exporter Hafizur Rahman suggested importing 50,000 tonnes of onions through the Trading Corporation of Bangladesh (TCB).

Bangladesh Poultry Industries Association vice-president Khandaker Monir Ahmed suggested the Directorate of National Consumer Rights Protection hold meetings with the producers and wholesalers to prevent hikes in the price of broiler chicken.

He said they were selling broiler chicken at a rate of Tk 185 and 'sonali' chicken at a rate of Tk 300 in the wholesale market.

Kaptan Bazar business leader Abdul Mannan, however, blamed the syndicate behind the rise of chicken prices. He said, “I would like to invite people who deny the existence of the Kaptan Bazar. A committee of 10-12 traders fix the prices at their will. They raise the price when the supply is low.”

Hearing that, the FBCCI president asked the price list be hung in all the shops at the wholesale market. The price list must contain the name address of the sellers, he said.

Bangladesh Fresh Fruits Importers Association president Sirajul Islam alleged that the date prices have doubled as compared to the last year due to the high tariff rate. He said it won’t be possible to keep the date prices within the reach of common people if everyone doesn’t come forward.

Sirajul Islam further said, “We are not being able to open the letters of credit. The Bangladesh Bank has fixed the price of dollars at Tk 110. However, we are buying dollars at Tk 123 to Tk 125. Although we are buying dates at a rate of Tk 110, we have to pay a tariff of Tk 140 for importing that. So the traders do not have any hand behind the high prices of dates.”

Moulvibazar Traders Association general secretary Golam Mawla expressed discontent with the tariff imposed on sugar. He said that they have to pay a tariff of tk 43 to import a kilogram of sugar, where the price of sugar in India is Rs 40. He also warned that he would lodge cases if someone is unlawfully called a holder.

Saifur Rahman, a leader of the wholesalers in the Karwan Bazar market in the capital, raised the issue of extortion and selling products outside the wholesale market.

He said some 300,000 to 350,000 kg potatoes and 200,000 to 250,000 kg onions are sold at the Karwan Bazar every day. But the truck fare increases due to the extortions along the way. Subsequently, the prices of vegetables also go up.

Officials of business conglomerates like the S Alam Group, Meghna Group and City Group said there is enough supply of edible oil, sugar and chickpeas in the country at the moment. There will be no shortage of these products during Ramadan.

Speaking regarding this, Centre for Policy Dialogue research director Khandaker Golam Moazzem told Prothom Alo on Wednesday, “The economy of the country is not in a normal state at the moment. It is hard to solve the dollar crisis and reduce tariffs. Rather it’s comparatively easier to stop extortion and the domination of syndicates in the market. The traders have to take a strong stance against extortions. They collect extortion related information from local business agencies and provide it to the government to solve the problem politically.”

“And to control the syndicate, small and medium entrepreneurs should be involved in the processes of production and transportations. Syndicates could be controlled if we can break monopoly,” he added.