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Last Updated: Monday, 18 October, 2004, 16:03 GMT 17:03 UK
Bangladesh tackles food cost rise
Flood victims in Bangladesh
Flood devastation is blamed for rising food prices
The Bangladesh government is to start selling reduced price rice directly to the poor amid soaring food costs.

Consumers' rights groups say prices of key commodities shot up as soon as the Muslim holy month of Ramadan began.

Opposition parties say the government has failed to control the price situation and demand its resignation.

The government, which has blamed high prices on the destruction of agriculture in recent floods, says its intervention will cool the market.

Ramadan 'shock'

The BBC's Waliur Rahman in Dhaka says the sale of rice, known as open market sale (OMS), will take place, bypassing the normal market system.

I have to pay 40% more for rice, up to 75% more for most vegetables
Mudassir Ahmed,
government officer

The food ministry says the price of a kilogram of rice has been fixed at 13 taka (22 US cents). It is currently selling it 17 taka on the open market.

The decision to introduce OMS came after prices of all types of rice shot up by about 30% in just two weeks.

The government sells rice directly to the poor when there is shortage of supply and prices go up beyond their purchasing capacity.

Commerce Minister Altaf Hossain Chowdhury, who visited a market in Dhaka on Monday, admitted that prices of rice and other essential commodities had not come down despite steps taken by his ministry.

However, he said several measures had been put in place to increase the supply of food items.

Mudassir Ahmed, a government officer quoted by Reuters, said: "Ramadan this time has brought us shocks."

He said his daily budget for buying food had more than doubled, eating into his meagre savings.

"I have to pay 40% more for rice, up to 75% more for most vegetables," he said.


SEE ALSO:
Deadly tornadoes hit Bangladesh
07 Oct 04  |  South Asia
UN warns of deaths in Bangladesh
20 Sep 04  |  South Asia
Poor response to flood aid appeal
07 Sep 04  |  South Asia
Unicef in $13m Bangladesh appeal
02 Aug 04  |  South Asia


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