Monday, 28 November, 2022

Rising inflation forces people to change food habit: CPD

  • Staff Correspondent
  • 21 October, 2022 12:00 AM
  • Print news

Mounting inflation has pushed up household food expenditure in Dhaka city by as high as 27 to 38 percent in nearly four years, according to a study by the Centre for Policy Dialogue (CPD). 

The report suggested that cost of food for a four-member family in the capital jumped to Tk 22,421 per month now from Tk 17,530 in January 2019.

As a result, people are trying to lower their food expenditure by avoiding the intake of protein like meat and fish.

If meat and fish are deleted from the food list, the food expenditure of a four-member family “practising a compromised diet” has shot up to Tk 9,059 in October this year, which was Tk 6,541 in January 2019. 

“The cost of living has gone up. Prices of commodities are rising not only for imported ones but also for locally produced ones. It is a burden on people,” CPD executive director Dr Fahmida Khatun told a press conference on Thursday.

“The inflation is shooting up unbridled. As a result, economic recovery is being hampered,” she added.

CPD also acknowledged that there is a sign of a food crisis, citing that FAO has said the food crisis may hit 42 countries, including Bangladesh.

“Food has now emerged as a political product. In future, Bangladesh may face problems in buying food from the global market as no country will sell food without preserving its own food stock,” said Dr Khandker Golam Moazzem, CPD research director.

“So, in the future, sufficient food might not be available in the global market despite having enough dollars in hand,” he warned.

CPD alleged that official statistics data do not reflect the actual picture of their market as BBS has stuck to the 2005 food basket whereas food habit in the country has gone through a big change in these 17 years.

The think tank found that the price of most products and services is higher than the South Asian average.

The CPD study showed that the price of half a kilogram of bread is Tk62 in Bangladesh, the highest in South Asia, whereas, the same bread cost Tk45 in Pakistan and Tk48 in India and Nepal. Even the cost of bread in Sri Lanka (Tk50) is substantially lower than that in Bangladesh.

The think tank said that the consumers in Bangladesh have to pay Tk684 for 1kg of beef, the highest in the region and substantially above the global average of Tk549.

The CPD report said that one kg of beef costs Tk 375 per kg in Pakistan, around half of Bangladesh's Tk684. Also, beef costs Tk580 per kg in India, Tk465 per kg in Nepal and Tk545 per kg in Sri Lanka.

Similarly, out-of-pocket health expenditure is the highest in Bangladesh, it said.

CPD says that poor and low-income people are facing hardships due to ongoing inflationary pressure.

It recommended removing advance income tax (AIT), advance tax (AT) and regulatory duty (RD) on all imported essential food items to help people manage their livelihood.

At the same time, it also recommended increasing salary and minimum wage in all industries to give relief to these limited-income people.

Apart from heated-up inflation and potential food crisis, CPD has identified the energy crunch, the Ukraine war, climate risk and Covid as other key risks for the country.

About the energy crisis, it noted that load shedding has soared to as high as eight hours, severely affecting industrial production.

Usually, Bangladesh maintains 60 days fuel reserve. Although it has a 61 days diesel reserve, octane reserve slipped to 19.6 days, petrol reserve to 38.4 days and furnace oil reserve to 27.9 days, CPD mentioned.

As a solution to the energy crisis, it suggested stepping up efforts to increase renewable power. It also called for lowering fuel prices, saying that BPC still has Tk 230 billion money in its hand.