Prices of essential goods rose 14 percent in a week after a recent record fuel price hike in Bangladesh, immediately affecting the transport sector, sparking street protests.
According to calculations by the state-run Trading Corporation of Bangladesh (TCB), prices of most essential items continue to rise daily after the government hiked fuel prices.
“The prices of 25 out of 26 essential items have spiraled in the last one week,” a spokesperson of market watchdog TCB said on Saturday.
In the last one month, the price of Bangladesh’s staple rice has increased by 22 percent, farm-raised chicken by 45 percent, onion by 43 percent, egg by 20 percent and fish by 10 percent, TCB said.
“Essential prices rose by 14 per cent in a week after the government hiked fuel prices,” Daily Star estimated based on TCB price chart.
The Samakal The newspaper carried a report on the situation, which stated that the market had exceeded all estimates.
Bangladesh’s inflation rate has been above 6 percent for the past nine months and hit 7.48 percent in July, leaving middle-class and poor families struggling to meet their daily expenses.
In a surprise announcement, the government last week hiked petrol prices by 51.2 percent to $1.38 a litre, 95-octane gasoline by 51.7 percent to $1.44 and diesel and kerosene by 42.5 percent, the highest single-time hikes. 1971 Independence of Bangladesh.
Commuters and transit users swallowed the first brunt of the hike as bus and truck owners immediately hiked fares.
Several thousand protesters took to the streets in Bangladesh’s major cities, with angry masses laying siege to fuel stations, while the government blamed the ongoing Russia-Ukraine war for the rise.
But the increase came even as oil fell again in recent weeks as fears of a recession mounted, while most independent financial analysts said the country could have contained the petroleum boom by adopting other means.
“The government could have phased it (increase) to reduce losses . . . increasing fuel prices by 4 to 5 percent over six months,” said Asaduzzaman, former director of the Bangladesh Institute of Development Studies (BIDS).
The energy ministry initially gave a brief statement in its efforts to justify the decision, saying that high fuel prices in neighboring countries, and particularly in India, forced the decision to stop smuggling.
But Prime Minister Sheikh Hasina asked the Energy Ministry to give a detailed explanation to the people.
Bangladesh’s economy stood at $416 billion in the current fiscal year, making it one of the fastest-growing countries in the world for consecutive years but rising energy and food prices have pushed up its import bill.
Earlier this month the situation forced the government to seek loans from global agencies including the International Monetary Fund (IMF).
“It is an unpopular decision on the part of the political government as the new prices are unbearable for many… but we had no other option,” Minister of State for Energy Nasrul Hameed told reporters. Hameed, however, said prices are expected to be reset soon after global prices fall and appealed for patience.
“As the transport sector is the largest user of diesel we are repeatedly asking everyone to be frugal, save fuel and use cars less often,” he said.