The state-run Trading Corporation of Bangladesh (TCB) is planning to launch a new pilot initiative to sell selected essential commodities in the open market outside of its existing Smart Family Card distribution system, aiming to help ease market prices and thus giving relief to the consumers.
Under the plan, commodities procured at comparatively lower prices from abroad will be sold to consumers at prices below prevailing market rates, without requiring any government subsidy, TCB Chairman Brigadier General Mohammad Foyshol Azad told BSS at his office here recently.
“This is completely a new initiative and it’s a thought of the present government,” he said while explaining the plan.
He said the initiative would initially be piloted with edible oil, with the first shipment of around 20,000 metric tons expected to arrive in the first week of September.
“We are starting with edible oil. If we can procure lentils at a lower price, we will also sell lentils. If we can procure sugar at a lower price, we will sell sugar as well,” the TCB chairman said.
The initiative is aimed at allowing all consumers to purchase the selected commodities, rather than limiting access to beneficiaries under the Smart Family Card programme.
“Everybody will be able to buy the items through open sale,” he said, adding that the initiative would initially be tested for around three to four months to assess how the market responds.
Brigadier General Foyshol said the first shipment would be treated as a ‘pilot lot’ and its success would depend largely on whether TCB could sell the procured commodity effectively in the market.
“If I bring the product but can’t sell it, then this can’t be continued. If I can sell it, then we can move forward with the initiative,” he said.
He made it clear that the government would not provide any subsidy for the proposed open-market sales. Instead, TCB would seek to benefit consumers by procuring commodities at competitive prices and selling them at a lower margin.
“The government will not give any subsidy here. Since, I have bought it at a lower price, I will sell it at a slightly lower price. But, it will be lower than the market rate,” he said.
According to the chairman, the price could be Tk10 to Tk12 lower per unit than the prevailing market price, depending on the commodity and procurement cost.
He said the initiative would not be seasonal in nature. Rather, TCB would assess the outcome of the initial pilot and consider expanding the programme if it proves successful.
The chairman said the initiative would begin with edible oil because of the high prevailing price of the commodity and strong market demand.
“Demand for edible oil is there. We are starting with oil because the price of oil is high now. If I can’t procure it at a lower price, I can’t sell it at a lower price,” he said.
He also indicated that other essential commodities, including sugar and lentils, could subsequently be brought under the open-sale programme if TCB could procure them at competitive prices.
The TCB chairman, however, said the corporation would not seek to intervene in every commodity market at all times. It would bring specific products into the market when necessary to address supply or price pressures.
He said the proposed open-market sales would be an addition to, rather than a replacement for, TCB’s existing subsidised sales programme through the Smart Family Card system.
“The subsidised operation is different. But, this will be at the market rate, but below the prevailing market price,” he said.
Brigadier General Foyshol said the initiative would operate under TCB’s existing mandate adding, “There is no separate title for this operation. It will be a normal operation,” he said.
He said no additional budgetary allocation would be required immediately for the pilot, as there is already a provision in the current budget for TCB’s operations.
“We have already kept provision in this budget. At present, we don’t need any additional budgetary allocation,” he said.
The TCB chairman expressed optimism that the pilot initiative, if successfully implemented, could subsequently be expanded to cover more commodities. “If the pilot is successful, it will go for extension,” he said.
He also hoped that TCB’s increased presence in the market through competitively priced open sales would contribute to bringing down overall market prices.
“If we can put the products into the market, prices will naturally start coming down,” he said.
The TCB chairman said the core message of the initiative was to make selected essential commodities available to consumers at lower prices through a new procurement-and-open-sale mechanism, while initially testing the model on a limited scale before considering wider expansion.
