IN the last fiscal year inflation in food price was about 11%. When 40% of the people of a country live bellow the poverty line, this trend of food price inflation becomes an unbearable headache for them. Though productivity in agricultural sector is gradually rising these days, it will, perhaps, not be sufficient to control food price. The upcoming days for us are not good as there are a number of crises to fight against.
Apart from development in some sectors the country has plunged into an ocean of problems, but we still do not see any sign of recovery. The ADB estimates that the soaring food prices could affect a billion people in Asia, home to two-thirds of the world’s poor and where spending on food accounts for 60% of total average expenditure.
Climate change, natural disasters, unplanned extraction of resources, power shortage, confrontational politics, rapid increase of population, massive corruption, social and political instability and so many other problems have engulfed the nation. With all these, food security and rise in food price have become big challenges as well.
According to BBS data, food inflation increased continually and stood at 9.72% in September, while it was 9.64% in August. Rural food inflation increased to 10.51% in September from 9.95% in August, while urban food inflation in September declined to 7.95% against 8.95% in August. Recently, a WB report on the Bangladesh economy said that prices in Bangladesh were affected by price developments on the international market, especially food prices in India.
The same argument was given by Will Martin, a manager of Agriculture and Rural Development section of the World Bank (WB) on December 27 in a seminar arranged by Bangladesh Institute of Development Studies. He said that the protectionist system caused sufferings to the consumers of the developing country. He also emphasised adoption of technology to promote agricultural growth. But
while doing so, Martin viewed the phenomenon from the consumers' perspective not from the producers' perspective.
Our government took the same view when it decided to import food grains from abroad. But, it has to be remembered that retaining the farmers in the agricultural system is very important for the country.
According to a projection of WB, there will be a massive capital growth in the coming years throughout the world, and this growth will indeed have a huge impact on the consump-
tion habit of people. In 2050, the population growth of Asia will be about 34%, and the growth in capital will be an amazing 80%. This growth will affect food price from both the supply and the demand sides.
Today, though people are not dying, they are going hungry and becoming stunted with reduced mental and physical capacity. They are suffering. The hungry population of over 60 million people is larger than most other global cases — the third largest poor population in any country after China and India. Nearly half of Bangladesh's
children are underweight, making it one of the most severe cases of malnutrition in the world. While Bangladesh has definitely got more food than it had thirty years back, yet almost half of Bangladesh is still far from being food secure.
Bangladesh has achieved production growth in agriculture not by accident but by deliberate efforts with more intensive use of inputs, which ultimately had a huge impact on our bio-diversity and environmental sustainability. When growth becomes the only goal and is achieved in
unplanned ways, it affects some related sectors badly.
For increasing agricultural output, technological adoption has been emphasised. There should be a difference in the use of technology as our agricultural patterns are different from those of the West. Small holding agriculture is increasing here, reducing the economies of scale. Moreover, agricultural food processing industries are not growing here, and diversification of food is also very difficult as we are struggling to meet the staple demand.
It is generally argued that high food
price reduces poverty, and many cite Vietnam as an example where increased food price has reduced poverty. But if we think about this argument, we will see that it is taken from the producers' perspective. If the small-holding poor farmers get better price, they will go above poverty line. Increased food price tends to allow labour wage rise, on which more than half of the labourers are dependent.
But the question is, how can we save ourselves from the upcoming food crisis and food price inflation when we have 5-10% food deficit, and to what extent can we depend on the world market? Nigeria reduced its poverty by taking a protectionist strategy, but if we want to follow it we will have to increase our production in a sustainable way and then we will have to get ready for the consequences as well. Experts argue that there may be a solution, investing more in research and development not in subsidy. They believe that extension of knowledge is of great importance.
A few days ago, inflation in food price in India was about 30%, and Bangladesh had to bear the severe impact of that inflation because of its proximity to India. In the upcoming days there will be more crises in our country in this regard as the gap between supply and demand will increase and our economy will be more dependent on the global market. And as there is a huge growth in capital especially in Asia, inflation in food price is inevitable.
It is true that the aggregate capital stock of the country is increasing, but the rising inequality in our society is also alarming. After some years, one strata of our population will perhaps be able to consume sufficient food and the poor farmers may also get their return from food grain production, but the huge population besides these two will lose their food purchasing power. So, being self-reliant is a must for us considering the upcoming food crisis and food inflation throughout the world.
M. MizanurRahman is an Assistant Director at D.Net and a Master of Development Studies at The University of Dhaka. E-mail: mithunmds07@gmail.com