Strong monitoring answer to unstable essentials market

In a desperate effort to rein in the seemingly endless bouts of price hike of basic food staples like vegetable oil, onion, garlic, egg, potato, etc., the government has set maximum retail price (MRP) on a range of products. Already it is evident that these measures are not having their desired effect. For instance, price per egg had been pegged at Tk 12 on Thursday (September 14), it was being traded between Tk 13 and Tk 13.5 on the following day. And while various government authorities were quick to state that thousands of cases had been lodged against producers and traders of the said commodities, these steps have come too late and often carry penalties that have little effect on market manipulative tactics.

Indeed, if one looks at the MRP chart, potato per kilogram (kg) is supposed to be Tk36 per kg, but was traded from Tk 48 to Tk 55 per kg on last Thursday; loose soybean that is consumed by a very large section of the less privileged section of society was pegged at Tk 169 per litre but traded at as high as Tk 180 per litre. One of the most volatile items, the local variety onion is supposed to trade at Tk 64 per kg, but retailed for Tk 90. The price variation was there for every other item. Hence people are left wondering precisely why this announcement was made because consumers ended up paying through the nose regardless of the directive aimed at controlling retail prices were wilfully ignored.

If past experience is anything to go by, these 'actions' usually mean the government opening up the market to import. This is hardly conducive to the economy on several grounds. First, the economy is in doldrums because of the state of finances. The government's monetary policy currently points toward saving foreign exchange as far as possible. The International Monetary Fund's terms dictate that the foreign exchange reserve cannot go below a certain threshold and hence the problem. Secondly, it is all too plain that there are no plans to seriously ramp up monitoring the supply chain of essential products. The onsite supervision of the markets is being done by several agencies working together and there is ample opportunity for traders to be informed well in advance of such raids. This is evident from the declaration by the ministry that the Directorate of National Consumer Rights Protection (DNCRP), DCs and UNOs will monitor market at local levels.

Such paltry measures have not worked in the past and certainly will not work now. Supervision at every level of the supply chain is what is required. There is no point in just concentrating on the tail end (retail level) because there is ample evidence that syndicates have been formed at every level up the chain. Beyond setting fines, what has been done? Have there been any incarcerations that are not easily bailable? For instance, there have been media reports recently that traders were selling ordinary eggs as 'organic' eggs and raking in huge profits. Examples of such cheating abound and yet there is none to watch the market on a regular basis. The DNCRP is vastly understaffed and under-equipped to monitor the dozens of markets in Dhaka city alone, forget about a nationwide monitoring scheme. Apart from these, steps need to be taken to address allegations that certain elements in the DNCRP have been in cahoots with companies involved in market price manipulation. If the authorities are serious about tackling artificial price manipulation, then it has to get tough on graft everywhere. Merely declaring MRP on everything is a delaying tactic unless backed up by active measures.