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Essentials stay costly

Staff Correspondent
The government will provide 30 lakh tonnes of wheat and rice as well as income support to the most vulnerable groups and rely heavily on bumper harvest to protect fixed and low-income groups from the apprehended rise in food prices in FY09.
Finance Adviser .Mirza Azizul Islam yesterday announced the new budget with plans to stave off the food insecurity. He however failed to present any concrete
measures how to rein in soaring prices of essentials that have financially crippled the middle and low-income groups.
The adviser said the government plans to procure 32 lakh tonnes of food grains throughEssentials to stay pricey internal purchase, import and food aid in the next fiscal year.
Thirty lakh tonnes of these food grains will be distributed through Open Market Sales (OMS) at concessional prices and through
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programmes like Food for Work, Vulnerable Group Feeding (VGF). Vulnerable Group Development (VGD), Test Relief and Gratuitous Relief.
Essential food prices had jumped from 9 percent to 54 percent over the last year, according to a report published by the Trading Corporation of Bangladesh.
Mirza Aziz assured that the government will still have 10 lakh tonnes of food grains in stock by the end of FY09 which would "enable us to tackle any food security related risks".
Medium-term steps include building new wholesale markets in Dhaka and main cities to improve distribution of food grains.
He also said the government may introduce a "consumers' rights protection ordinance".
The government has identified the ultra-poor, the rural middle and lower middle-class groups as the worst affected by the price inflation.
In an effort to supplement the income of the vulnerable groups, the government is going to expand the social safety net to increase their purchasing power.
For VGD, the government will continue providing 30kg of wheat or rice per person for 7.5 lakh women and introduce Tk 400 monthly allowance per head for another 40,000 "underprivileged women" of eight northern districts.
Mirza Aziz announced that TK 1,578 crore has been proposed in Food for Work Programme, which is expected to generate 14.4 crore workdays of employment.
The government said it "hopes" a current bumper harvest alongside a forecasted increase in global food production would also rein In soaring food prices.
The adviser announced that the government plans to increase farm supplies and hopes (hat an "incentive pricing system", through which farmers would receive higher prices, would encourage fanners to boost production.