by David Hulme
Global attention on Bangladesh is focused on the crisis created by the November 15th cyclone. This has caused horrific suffering, but the country also faces a more insidious and slowly unfolding crisis. Below is a note that a colleague in Bangladesh has emailed me. As the country is under a caretaker administration, backed by the military, s/he cannot reveal their identity. The recent increases in global food prices are clearly already putting enormous pressure on poor people’s incomes around the world – but, is Bangladesh really facing a ‘near famine’. Let me know what you think.
The Impending Food Crisis in Bangladesh
Food prices in Bangladesh are galloping by the day, and essential commodities, such as rice, wheat flour, cooking oil, onion and lentil are now well beyond the reach of the common man. It was not that prices were downward during the five-year period of the last elected government, but these have been continuously creating all time high records during the last one year, that is after a civilian caretaker government, armed with emergency provisions, backed by the armed forces and enjoying the blessings of the international development partners, took over in Bangladesh. Indeed, with various reforms, including a crackdown on corruption, it was widely expected that economic development would further pick up, and there would be an accelerated reduction of poverty in Bangladesh. Unfortunately, the records show an unmistakable downturn in the economy with dwindling investments, both internal and external. In fact, Mr. Forrest Cookson, an American free-lance consultant living in Bangladesh, has recently commented that this year, the GDP growth rate in Bangladesh may be in the negative. Compare it with the 6 percent growth rates of recent years.
So, the question to ask is ‘what happened during the last one year’. It seems that the poor economic mismanagement under the caretaker government started with indiscriminate raids on the godowns (Wharehouses) of large food dealers and importers on the pretext of cracking down on food adulteration. This is one of the usual gimmicks of Martial Law/Semi-Martial Law governments in their initial phase to win popularity and pressure the private sector into submission. Adulteration of food is certainly a problem in Bangladesh, and action against it was progressing quite impressively during the rule of the last elected government. However, the brutal and thoughtless manner in which it was operationalised by the caretaker government had a disastrous impact. Many food importers and food merchants stopped importing and distributing food. This was despite the amendments and inducements introduced later and solemn promises made by the high-ups not to harass them in the future.
Second, the interim government has dragged its feet on importing food grains for at least six to nine months, given the slow and complicated policy-making and implementation mechanism in place in Bangladesh and despite the emergency provisions. In countries like Bangladesh suffering from food insecurity, it is important to maintain a substantial food reserve in the public sector, as a guarantee against food hoarding and super profiteering in food. Also, when there is indeed a food crisis, the reserve comes in handy in the form of open market operations, modified rationing, test relief, vulnerable group development, etc all designed to stabilise food prices, on the one hand, and address the lack of access to food by the poorest sections in the society, on the other.
Third, when the government decided to import food, it was rather late in the day. Since the international food supply was tight this year, prices had already soared high. In fact, certain sources were unable to supply food to Bangladesh simply because they did not have the adequate stocks. Fourth, India, the neighbour on three sides, formally banned export of food grains to Bangladesh on the legitimate grounds that India itself was likely to experience food shortages this year. Generally, food from India, obtained mostly through informal channels, has a cushioning effect on food scarcity in Bangladesh.
Fifth, the Bangladesh Rifles (BDR), lacking in experience in this field and well known for its corruption, particularly given its complicity in smuggling across the international borders, was made the only channel for distributing subsidised food among the poorer sections in the society. The amount distributed through this channel was not only highly inadequate, but there was also little public confidence in such an organisation. Under civilian government, it is inconceivable that BDR would emerge as the only public sector organisation entrusted with such a task.
Sixth, the civilian field administration, which generally has an important role in relief and rehabilitation operations, is now furthest from its normal zeal, enthusiasm and idealism to serve the people in a crisis situation like this. Heavily eroded by politicization, corruption and inefficiency over the years, the morale of field-level civil officers has taken a further beating from the “lording” they are now experiencing at the hands of young military officers placed at the field level during the last one-year. In such circumstances, and as past records indicate, the civil servants tend to retaliate by resorting to minimum actions and text-book behaviour, instead of taking initiatives and going out of their normal line of duty to tackle the crisis.
Seventh, despite the fact that many politicians are generally corrupt, they invariably stand by the people at crisis points with party-organised relief, given that they have to seek their votes at the time of election. They also act as intermediaries between the people and the field bureaucracy, local government bodies and NGOs engaged in relief and rehabilitation work. During the last one-year, they were either on the run or in jails or debarred from participating in relief and rehabilitation efforts. In fact, during the last floods, even the local government elected functionaries generally stayed away from such activities, owing to the prevailing extra-ordinary circumstances.
Eighth, during the last one year, Bangladesh had more than its share of natural calamities, two consecutive floods to begin with and then the recent devastating cyclone, which have taken a heavy toll of lives, property and crops. Also, in the absence of a popularly elected government, the national response to these events left much to be desired.
Ninth, given the high market prices of both food and fertiliser, government decided to provide a high level of subsidy to these items, but it is precisely in such a situation that “targeting” becomes all the more difficult. Most likely, these highly subsidised commodities would ultimately end up with the “strong and the sturdy” rather than the poor farmers and landless labourers. Whatever trickles down to them would be available at much higher prices. There are already reports of riots over fertilizer distribution.
Finally, the caretaker government through its cheap and irrational policies made things worse for the economy. In the name of crackdown on corruption and non-payment of taxes, the entire business community and the professional class were simply terrorised, and this had a disastrous impact on investment and job creation in the country. In the first two/three months, there was also massive displacement of poor squatters and lower-middle class shop-owners in the name of slum clearance and cleanliness drives. Corruption and no-tax mentality did not develop in a day and these can be remedied only over the years through sustained and multi-pronged efforts. The comparison with the Indian experience also shows that quick fixes are no substitutes for long-term sustainable measures. Those who have lived through successive Martial Law regimes in Bangladesh since the early sixties, know very well that the methods employed to correct these ills are not only inadequate but are also tied to a sinister intention, namely to de-legitimise those in power, so that the new power-holders can be in power for some time to engage in exactly those very activities that they vociferously condemned when they came to power. Just look at the record of Ayub Khan, Yahya Khan and Ershad before the present semi-military rule in Bangladesh, and it would become crystal clear even to those seeking “quick solutions” that in the long run, the military rulers and their civilian cohorts prove to be no less corrupt than the elected governments. In Bangladesh, the military’s massive corruption in defence purchases is well known (the Economist in the UK pointed this out about six months ago).
Any way, the long and short of the recent Bangladesh story is that wrong policies and poor implementation of good policies have made short work of both internal and external investments in the country, and this has meant a severe blow to economic growth and job creation- in other words, the worst of both the worlds, namely severe inflation coupled with a sharp decline in purchasing power. Unfortunately, this may mean a famine or near-famine condition in Bangladesh in the next three to six months, and a breakdown in the “exchange entitlements” for the poorest sections of the population, particularly those located in the “Monga” belt extending to greater Rangpur, Jamalpur, Sirajganj and parts of Faridpur and the coastal areas recently hit by the cyclone.
– The government should own up publicly to the real situation, so that corrective measures may be taken – all is not lost as yet.
– The political parties under the leadership of Hasina and Khaleda should be allowed to organize their own relief operations among the affected people.
-Grameen Bank, BRAC and other large and medium-sized NGOs should be involved in distributing subsidised food and fertiliser among the target people, in addition to the BDR.
– The military at the field level should act in support of the civil authority and not the other way round. The field administration, along with the local government bodies and local NGOs, should be sufficiently empowered to act, but under close civilian supervision at different levels
– The development partners should come up with not only cash but also substantial amounts of essential commodities to avert the humanitarian crisis about to break out in Bangladesh
– The state of emergency should be lifted immediately, so that the business community and the professional class can feel confident enough to get on with their lives in a free market economy.
– The armed forces should be involved mainly in rescue operations, restoration of the supply lines (roads, electricity, etc), air lift of essential supplies to hard-to-reach areas, preparation of the VGD cards and over all monitoring in aid to civilian power.