Consumers not getting benefit from fall in inflation:Daily Sun

 Ordinary consumers are not getting the dividend of the downward trend in inflation as the commodity market is still in the grab of vested syndicates controlling the market prices in major cities, analysts say. In a reverse picture, the growers are not getting fair prices for their products, said the analysts. Inflation declined to 6.21 percent in November this year from 6.60 percent point in Octo
ber. Finance Minister AMA Muhith had set the target of bringing down inflation below 7 percent by the end of the current calendar year. In July last year, inflation was recorded at 7.05 percent. The inflationary pressure has been maintaining a downward trend since then. The economists, however, have identified some risk factors like the government’s plan for a salary hike for the public servants and an upward adjustment in gas and electricity prices, which may escalate the inflation in the days to come. Talking with daily sun, former Bangladesh Bank Governor Dr Salehuddin Ahmed said the commodity market is ‘extremely undisciplined’ and the government has ‘no control’ over it. “Though we see a fall in inflation statistically, it does not mean that people with limited income are getting the dividend of the fall in inflation. They still buy vegetables at Tk 60 per kg in this city while it is being sold at Tk 8-10 per kg at the growers’ end in Bogra,” Dr Ahmed said. He said the production and supply side has constantly been doing better in recent months, but the market remained out of the government’s control. “The market is extremely undisciplined due to multi-layer interventions of vested quarters and the government has no control over it,” he said. He said the demand side remains weak as the purchase capacity of people is not increasing due to higher unemployment in the country. The general inflation rate was 6.84 percent in September and 6.91 percent in August this year. The non-food inflation rate in November, however, rose slightly to 5.84 percent, up from 5.74 percent in October. Food inflation in rural areas declined to 6.38 percent in November this year from 7.11 in October. The non-food inflation rate in rural areas rose slightly to 5.45 percent in November from 5.36 percent in October this year. In urban areas, the food inflation rate declined to 6.61 percent in November from 7.27 percent in October this year. Non-food inflation rate in urban areas, however, witnessed an uptrend in November as it stood at 6.39 percent, up from 6.26 percent in October this year. The Bureau of Statistics say the national wage index reached 8757.62 in November this year, posting a 10.32 percent rise from 8701.74 in October this year. Research Director of Bangladesh Institute of Development Studies Dr Zaid Bakht said the inflationary pressure had eased due to the persistent low commodity prices at international market and in neighboring India. “Both the markets –international market and inflation in India – influence our market,” he said. But he feared that a new pay scale for the public servants and tariff hike of gas and electricity may fuel inflation. “However, if we evaluate the current situation, we can say that the government will be able to achieve the target of bringing down inflation below 7 percent,” Dr Zaid Bakht said.