Financial Express print this

Galloping prices of sugar


CONSUMERS, apparently, have no respite from the onslaught of the greedy traders dealing in essential commodities. If these traders decide to fleece the consumers by raising the prices of one commodity today, they would shift to another tomorrow and thus continue with their unethical and immoral business practices. Unscrupulous traders have been enjoying a freehand as the government continues to shirk from its responsibilities on the pretext of unhindered operations of free market economy.
Sugar, of late, has turned extremely sour because of its galloping prices. The prices of the item started increasing on the eve of the holy month of Ramadan. And since then its prices have been going up and up and it now sells between Tk. 55 and Tk. 56 a kilogram. The rise in prices of the item is about 100 per cent over a period of last one year. There is no denying that the prices of sugar has increased in the international market, for Brazil, the world's largest exporter of sugar, has scaled down the volume of export in recent months. The unabated hike in the prices of petroleum products in the international market has forced the South American country to reduce sugar exports. It is now using sugarcane to produce ethanol, an alternative fuel, to cut its costs on the import of petroleum fuels. Moreover, there has been continuous erosion in the value of the Bangladesh Taka vis--vis the greenback. These two factors have combinedly pushed up the cost of import of sugar, no doubt. But the fact remains that the prevailing market price of the item is unjustifiably high because of the machinations of a handful of traders who have formed cartel to control the sugar market.
The locally produced sugar meets only 10 per cent of the domestic annual demand and the rest is imported by the private sector. Allegations have it that the cartel not only dictates the market price of the imported sugar but also does the same in the case of sugar produced by the state-owned sugar mills. The consumers do not get the benefit of the low price offered by the Bangladesh Sugar and Food Corporation (BSFIC) to its sugar dealers produced by the public sector sugar mills. These mills sell sugar to the dealers at Tk. 35 a kg. But the price the consumers pay for locally produced sugar is equivalent to that of imported one since the allotment letters given to the dealers by the BSFIC are promptly bought up by the members of the cartel. The BSFIC authorities have never bothered to cancel dealership of the traders who indulge in such unethical practices, for a section of its officials, allegedly, do earn a few extra bucks from the dishonest dealers.
What, possibly, pains the consumers most is the indifference of the commerce ministry to their unending plight. Even if the government, as a matter of policy, decides not to intervene in the free operations of the market forces, the prevailing prices of many essential items do not in any way relieve it (the government) of the responsibility of checking irregular business practices. The government cannot keep its eyes and ears shut only by saying that it has no business in business. Whenever, the price of any essential commodity goes up at the retail level unreasonably, the ministry of commerce should make a proper cost analysis of the same and tell the traders to bring down the price at a reasonable level. However, such analysis should not exclude the additional expenses that the importers and traders have to make on bribing the officials, police and extortionists at different points. The ministry of commerce has to prove both to the traders and consumers that there is an effective government entity that is serious about ensuring welfare of the consumers.