The Bangladesh Cabinet Committee on Economic Affairs (CCEA) gave the approval to the Directorate General(DG) of Food and the Trading Corporation of Bangladesh(TCB) to buy rice, soybean oil and lentils from the domestic and international market for sale at subsidised rates among low income groups. Currently, rice stocks with Bangladesh are only at 1.8 million tonnes.*
The Sheikh Hasina Wazed government reduced the duty on imports of foodgrain from 65% to 25% and further slashed import duty on rice to 15% with future plans to eliminate the duty***.
- DG of Food to buy 400,000 tonnes of rice under state to state contracts to help the food office build up an adequate stock of the grain and build a cushion to low income groups from the ongoing inflationary pressure. Clearance was given to the food office allowing them to float an international tender for purchasing rice on an emergency basis. Prospective bidders would have 15 days to submit their proposals instead of the usual 42 days.
- The Food Ministry signed a contract to buy more than 500,000 tonnes of rice from Vietnam, India and Myanmar under state to state contracts and the decision of the CCEA would allow the procurement from the international market in about 30 days less than the 90 day period as per rules.
- TCB got an approval to purchase 15,000 tonnes of lentil and 6,000,000 litres of soybean oil to distribute amongst 1crore families that are registered family card holders at subsidised rates.*
DG of food reportedly signed an agreement with an Indian public sector firm to import 1 Lakh tonnes of rice at $442 per tonne at government to government (G2G) basis which is Bangladesh’s first G2G agreement of Rice Imports with an Indian public sector firm.
From India, 70,000 tonnes of non-basmati parboiled rice (TK42.13 per KG) will be imported by sea and 30,000 tonnes of rice(TK40 .70 per KG) will be imported by road both at an import price of $443.50 per tonne**.
It also reportedly signed an agreement with Vietnam to import 2.3 lakh tonnes of parboiled rice at $552 per tonne which traders considered unacceptable.
Dhaka (the capital city) has been buying large amounts of rice since June’22 and is partly to blame for the rise in Indian prices. Dhaka intends to import at least 1 Million Metric Tonne (MMT) from India through both G2G and private trade. Private traders have already imported 1.4lakh tonnes of rice from India recently at an average of $464 per tonne.
- For the country’s 16.5 crore people, soaring prices of staple food posed a problem for the government of Bangladesh that plans to cut prices to help people hit hard by high costs.**
- Dry weather and floods have harmed the crops of the neighbouring country’s Aush, Aman and Boro. Aman crop accounts for 39% of the total rice production and any harm would affect the country greatly, Aush crop lost at least 6 lakh tonnes. Boro harvest was disturbed due to flooding and Aman harvest due to low rainfall.
- The country signed the agreement with Vietnam because it doesn’t want to risk a food crisis like Sri Lanka and also due to imposition of export duties on non-basmati rice except parboiled rice by India.
The CCEA of Bangladesh states that grains would start flowing into the country from September’22. In an effort to restrain surging domestic prices of rice, the government would be selling rice at cheaper rates to 50 lakh families from September**. The shortage is being covered by the food directorate, increasing its open market rice sales across the country. The authorities are taking measures to boost food stocks. Bangladesh is set to import 9 lakh tonnes from India and Vietnam and the governments of Bangladesh and Myanmar have also set a deal to further import 2lakh tonnes of rice in Bangladesh.