TCB gets Tk150b from govt to offset its trade gap

The government has provided Trading Corporation of Bangladesh (TCB) with Tk 150 billion as subsidy to help offset its trade gap for current fiscal 2024-'25 on account of selling key essentials at subsidised rates.

The Ministry of Finance has already issued an order to this effect recently, according to officials.

Earlier, the Ministry of Commerce (MoC) sought the said amount of subsidy from the government for the period between July 01, 2023 and June 30, 2024.

The TCB, the state-run trading entity, sold some essential commodities including edible oil, lentils, sugar at subsidised prices among the lower income people, aiming to help keep their prices stable in the market.

The TCB would be able to utilise the fund only for the purpose of financing its trade gap, the finance ministry order revealed.

According to available data, the TCB bought 2, 19, 628 tonnes of lentils at Tk 25.32 billion and sold it at Tk 12.03 billion, causing a trade gap of Tk 13.28 billion.

The state trading agency also suffered a trade gap worth Tk 1.07 billion on account of selling 12,061 tonnes of sugar at Tk 781 million against its buying price of Tk 1.85 billion, incurring a

The TCB sold about 214.9 million litres of soybean oil at Tk 38.77 billion and sold the same at Tk 20.36 billion, counting a loss of Tk 18.40 billion.

It had to incur Tk 468.8 million on account of selling 9296 tonnes of gram for Tk 462.3 million against its procurement cost of Tk 931.1 million, official sources said.

The TIC also incurred Tk 630.5 million for selling 1576 tonnes of dates at reduced rates, Tk 519 million for 7064 tonnes of onion and Tk 8.1 million for marketing 560 tonnes of potatoes.

The TCB required to borrow from banks at the rates of 9.0 per cent to 12 per cent, a senior official told the FE, adding that such higher rate of interest pushed its commodity procurement costs up.

Besides, the TCB also required to pay 2.0 per cent income tax against its sourcing of commodities from the local market and provide its dealers with 'operating cost' ranging between Tk 5.0 and Tk 7.0 per for a kilogram or litre.

Earlier, the state-run entity had sought around Tk 100 billion of funds directly from the government to help lessen its dependence on costly bank borrowing, said a source.

At present, the TCB sells of essential items every month at subsidised prices, targeting the lower income group of people.

However, such sales drives hardly made any visible impact on the essential market, it was learnt.

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