Committed to PEOPLE'S RIGHT TO KNOW
Vol. 5 Num 1128 Thu. August 02, 2007  
   
Business


Inflation of foods in urban areas reaches 10.71pc in June


The point-to-point inflation rate of food items for the urban areas crossed double digit to reach 10.71 percent in June, threatening more sufferings for the fixed income group.

Overall inflation rate on a point-to-point basis in June of the last fiscal stood at a 10-year high of 9.20 percent, according to Bangladesh Bureau of Statistics (BBS).

People of the urban areas have to pay extra money to buy food items compared to the rural areas.

The government data shows that overall inflation rate on point-to-point basis in rural areas reached 9.14 percent in June, which was 8.04 percent in May.

Point-to-point inflation of food items reached 9.45 percent in June in the areas, which was 7.98 percent in May. Such inflation of non-food items reached 8.55 percent in the rural areas in June, which was 8.15 percent in May.

According to BBS data, in the urban areas, overall inflation rate on point-to-point basis reached 9.35 percent in June, which was 8.08 percent in May. Inflation of food items on point-to-point basis reached 10.71 percent in June in urban areas, which was 9.21 percent in May.

Inflation on point-to-point of non-food items reached 7.80 percent in urban areas, which was 6.78 percent in May.

The higher domestic and international food prices as well as raising the prices of petroleum products by 21-33 percent by the government in April to bring them closer to international prices resulted in the high inflation rate in urban areas.

Besides, lack of proper supply management also contributed to the rise in the rural areas.

As a whole, as the government initiatives fail to control the price spiral, the people in the urban areas, especially fixed income group, suffer much more than any other time before.

In addition, the floods have seriously affected production of crops including paddy, jute, sugarcane and vegetables in around 275 upazilas of 46 districts, which may lead to further increase in the price of food items, especially vegetables.

Crops of 1.75lakh hectares of land have gone under floodwater, said sources in the Department of Agriculture Extension (DAE).

Crops, especially seasonal vegetables and Aus paddy of these areas, will be lost if floodwater stays for a long time, the DAE sources said.

They fear Aman plantation that is usually done by August will be delayed too.

It is becoming very difficult to survive in the city area like Dhaka because of increasing prices of every commodity, said Syed Iftekhar Rahman, a private service holder, while talking to The Daily Star at Rampura bazaar.

He said, "The reality is that we have to live in Dhaka for livelihood---we are in great distress."

Meanwhile, Asian Development Bank (ADB) on Tuesday projected further inflation in case of government's failure to find out proper mechanism to contain food prices and rise in the prices of those items in the international market.

In view of higher international food prices and given the large share of food in inflation, the government measures taken so far to contain the price spiral are unlikely to dampen inflationary pressure, the ADB said.