11-12-2013:The Financial Express: Country's food inflation shot up to 8.55 per cent on point-to-point basis last month, one of the highest levels in recent years. The general inflation was also on the high side.Predictions are that the situation would be even worse in the current month.But the inflation situation was supposed to be the opposite during the months between November and March when the supply of winter vegetables and fish traditionally remains abundant. Market also witnesses the arrival of the newly harvested Aman rice.
The prices of most food items usually remain within the reach of the common people unless something unusual happens either in domestic or international markets. Political unrest, marked by the most-prolonged road-rail-waterways blockade that the country has ever witnessed, is primarily responsible for the cost-push inflation. The political opposition alliance has been enforcing programmes of general strike and blockade over the poll-time government dispute.The prices of most items in the kitchen market have recorded a rise, onion being at the top of the chart. A kilogram of local variety of onion now costs a record price of Tk.150 and the same of imported variety Tk.120. A week back the price of imported onion was less than half of the present one. The prices of vegetables and fish in Dhaka markets would have been nearly half of the prevailing ones in Dhaka city had there been no political troubles. The opposite is being experienced in rural huts and bazaars because of over-supply of these items. Vegetables are now rotting in the farmers' field. The price of a litre of milk has come down to half of that prevailed a month back.
A number of private television channels have shown the milkmen dumping milk in a roadside ditch following their failure to sell their product to large milk and milk products marketing companies. The worst-ever political unrest has been causing serious disruption to supply chain of products, agricultural or otherwise. Everyone, starting from a billionaire industrialist down to a day labourer, is affected. However, the nature and extent of their sufferings do vary widely. The day labourer is finding it hard to earn his daily bread for construction work has slowed down to a large degree and demand for menial job reduced during the past few weeks.
In Dhaka and other cities and towns, markets and large roadside shops have also remained closed for days together. Many shop owners have expressed doubt about their ability to pay wages to their employees for the last month. Many businesses are not being able to repay loans to banks and becoming defaulters, which, in turn will take a toll on the banks.
The ongoing political situation would only help swell the non-performing loans in banks and other financial institutions. The apparel sector which is still reeling under the impact of two major tragic accidents and recent workers' violence over the wage issue is also taking brunt of the political violence. The ongoing political events, reportedly, have only strengthened the exodus of buyers and a neighbouring country, according to an Indian financial daily, is being benefited most by it.The International Monetary Fund (IMF) has already made it known how the political unrest over poll-time government would hurt the economy and trimmed its previous growth projection for the economy during the current fiscal.
Finance Minister AMA Muhith was no less frustrated. While talking to a group of journalists last Sunday he made it no secret that the economy is being severely affected by the ongoing political troubles.It is obvious that the troubles would not continue for a long and there will be an end to it sooner or later. But the cost these troubles are exacting from the economy, will undoubtedly be enormous. However, there can only be guesstimates about the cost for no serious efforts are unlikely to be made to this effect even the troubles are over.