Govt wants rice, eggs, chicken on 'essential commodity' list to control prices

Infographic: TBS

The government is going to expand the list of essential commodities in "The Control of Essential Commodities Act" to bring relief to consumers. This move comes in after the initiative to update the six decades-old act did not make headway as expected.

According to commerce ministry sources, the new list of essential commodities is likely to include drinking water, rice, flour, fish, poultry, milk and eggs, soap, detergent powder, toothpaste, potato, wheat, paddy, black cumin, green chilli, puffed rice, flattened rice, and liquid pesticides. 

Moreover, some products such as cigarettes, cloves, cardamom, bay leaves, and cinnamon are likely to be thrown out from the list.

The Federation of Bangladesh Chambers of Commerce and Industries (FBCCI), Bangladesh Trade and Tariff Commission (BTTC), Ministry of Agriculture, Ministry of Fisheries and Livestock, and Ministry of Health have recommended a whole host of products to be listed as essential. 

The prices of soap, detergent powder, toothpaste, and various types of liquid pesticides have skyrocketed recently and the government has long been planning to widen its control over the market, which remains volatile since March last year.

As per the law, the government can step in to control the prices of products listed as essential and take action against market manipulators.

Tapan Kanti Ghosh, senior secretary of the Ministry of Commerce, told The Business Standard, "A committee was formed about a year ago to amend this law but things didn't work out as planned. However, the list of essential commodities in that law is being rectified. Some new products will be included in this list."

The Control of Essential Commodities Act (CECA), enacted in 1956, is a law in Bangladesh that gives the government the power to regulate the production, distribution, and pricing of essential commodities.

The purpose of the law is to ensure the availability of essential goods at fair prices, especially for low-income consumers.

Under the law, the government can set up special mobile courts to enforce the law and take action against those involved in market manipulation, hoarding, and black-marketing of these products.

The law is often used during times of crisis or natural disasters when the availability and pricing of essential goods may be affected.

In 2013, the list was revised to include sugar, salt, onion, gram, cumin and other spices. However, various other products including cigarettes, which were included during the Pakistan period, still remain on the list.

There is a provision in the law which allows the production and marketing of essential products in any crisis or emergency situation such as a pandemic or natural disaster.

Taking advantage of this law, cigarette manufacturing companies, including British American Tobacco Bangladesh, continued production and marketing operations when all industries were closed during the Covid-19 lockdown even though the ministry of health objected.

The Ministry of Health has recommended removing it from the list. This issue is much anticipated as anti-tobacco organisations have long been criticising the government for including cigarettes in the list.

Lawmaker Saber Hossain Chowdhury, who chairs the Parliamentary Committee on Environment, had submitted a private member's bill seeking the exclusion of tobacco from the list of essential commodities. 

At a programme in November 2020, he regretted how tobacco companies took the opportunity of being of the 1956 law and enjoyed the special privileges and stimulus funds during the pandemic. He also questioned why the government still holds a share in a tobacco multinational.

Golam Rahman, former commerce secretary and chairman of Consumers Association Bangladesh (CAB), told TBS, "The list of essential commodities in this law is outdated and needs to be updated for the present."

"Adding new products to the list will not reduce the prices in the market but the government should have the legal authority to protect consumer interests in the market by setting the indicative prices of these products," he said.

The former commerce secretary, however, mentioned that some problems may arise if the essential commodity list is widened too much.

Last year, the Bangladesh Competition Commission filed cases against 11 individuals and organisations for creating instability through artificial crises and abnormal price increases of rice, flour, eggs, poultry and toiletries products in the market.

When asked about the initiative to expand the list of essential commodities, Biswajit Saha, director of Corporate and Regulatory Affairs at City Group – a leading consumer goods company, told TBS, "Rod and cement have been declared essential commodities. Now there are talks of including some more products. I hope the government will take the decision after a comprehensive review."

"However, as a businessman, I want to point out whether it is right to impose duties on the imports of the raw materials for the products, which will be declared essential. I hope this issue will also be reviewed by the government. If it is an essential good, there should be no import duty," Biswajit Saha added.

According to officials of the commerce ministry, big corporations are marketing these non-essential products by determining the maximum retail price (MRP). Since they are selling at MRP rates, neither the commerce ministry nor the Directorate of National Consumer Rights Protection could take any action in this regard.

To deal with the price volatility, Commerce Minister Tipu Munshi had earlier announced fixing the prices of various products including rice and flour, rods, and cement, but the effort stumbled due to legal restrictions which prompted the ministry to take the amendment initiative. 

An official of the commerce ministry involved in revising the list told TBS, "Sometimes the price of green chilli goes up to Tk400 per kg in the market. But since it is not a listed essential product, the government cannot step in due to legal restrictions. Therefore, the Ministry of Agriculture has recommended including this product in this list."

The Consumers Association of Bangladesh (CAB), which works on consumer interests, has recommended amending the name of the Act to include various types of services including online services.

Essential product list of India and Pakistan  

Tobacco still remains on the list of essential commodities in Pakistan, which, updated in 1977, later included poultry feed, among more than 40 types of products.

India amended its 1955 essential commodities act in 2020 and shortened the list of essentials to seven types, which include fertiliser and seeds.

While the changes have been criticised to benefit the businesses more than the consumers, the Indian government felt the changes were needed to increase farmers' income and improve the ease of doing business. India was not self-sufficient in food when the original act was passed six decades ago.