$300 m saved reducing food grains import

Mahfuz Emran: The government is reducing the import of food grains to reduce the pressure on the reserves. For this reason, it has been decided to reduce the import of 5 lakh metric tons of rice and wheat in the next financial year (2023-24). Through this, the government will save at least Tk 328million (Tk 3280 crore). This will reduce the pressure on foreign exchange reserves.
However, more food grains will be procured from the domestic market to meet the demand. For this reason, it has been decided to give farmers a fair price for rice. These decisions will be implemented gradually from July 1. This information is known from related sources.
Food Minister Sadhan Chandra Majumdar told Daily Industry that the production of Aman and Boro rice has been good. However, if the demand for food grains increases, the allocation can be increased in the next revised budget. Apart from this, there is no problem this year in terms of internal collection, even if it is difficult in other years. Because our internal collection situation is good.
After reviewing the budget documents of the Ministry of Finance, it has been found that the target of food grain import in the next financial year has been reduced by 25 percent from the current (2022-23)
financial year. Accordingly, the allocation for the food import sector has been reduced from Tk 8,278 crore in the current financial year to Tk 4,990 crore in the next budget. That is, the allocation is decreasing by Tk 3,280 crore or more than $300.17 crore US dollars (price per dollar is 108.70 taka).
Although the food grain import sector is allocated in taka, the price is paid in US dollars at the end of the tender process. It has to be paid in dollar value in case of import at government to government or private level.
An official of the finance department involved in this process said that in the current fiscal year, the cost of importing food grains was calculated at the dollar value of Tk 80. As such, Tk 2,579 crore were allotted. But since June last year, the value of the US dollar has increased abnormally. At the same time the value of money depreciates. In addition, the Russia-Ukraine war caused global food shortages. So that the country does not fall into this crisis, the Prime Minister has ordered to import food grains more than the target. As a result of the existing crisis and the implementation of the Prime Minister’s order, the import cost of food grains increased from Tk 2,579 crore to Tk 8,278 crore. In this sector, the allocation increased by Tk 5699 crore or $52.42 crore over the target.
According to sources, the government has reduced the rice import target from 9 lakh metric tonnes to 4 lakh tonnes for the current financial year to save dollars in the next financial year. Similarly, it has been decided to reduce the import target of 7 lakh metric tons of wheat to 6 lakh tons. It shows that it has been decided to reduce the import of rice and wheat in the current fiscal year from a total of 1.6 million tons to buy 1.1 million tons in the next financial year. Currently there is a foreign exchange crisis.
On the other hand, as per the terms of the IMF, the net foreign exchange reserves should be taken at $24 billion. As a result, the use of dollars in the import of food grains will be reduced to reduce the pressure on reserves. Due to which the allocation for import of rice and wheat has also been reduced. Till June 14, 10 lakh 55 thousand tons of rice and 34 lakh 40 thousand tons of wheat have been imported.
Meanwhile, a target of 15.76 percent more foodgrain collection from the domestic market has been set in the next financial year. Out of this, the target of the current fiscal year will be increased from 17 lakh 35 thousand metric tons to 19 lakh 61 thousand metric tons. And wheat will buy 100,000 metric tons. Tk 9,100 crores have been allocated for the purchase of rice and wheat from the domestic level in the next financial year. In the current fiscal year, the allocation for this sector is Tk 7,207 crores.
A senior official of the finance department, on the condition of anonymity, said that a kind of balance is done in the collection of food grains. Eg: In the current financial year less, purchases have been made from domestic level. But the import of food grains was high. Again, in the next financial year, although the import will be reduced, domestic level collection will be more. But so that the farmer gets fair price, the price of rice per kg is fixed at Tk 44. He also said that farmers will not be interested in giving paddy and rice to the government if the price is low.
According to the Food Ministry, 10 lakh 55 thousand tons of rice and 34 lakh 40 thousand tons of wheat have been imported till June 14. At the same time, 5 lakh 23 thousand 75 metric tons of rice and 86 thousand 385 tons of paddy have been collected from the internal level of the country. Generally, the government collects rice and wheat and distributes it through various social security programs. It has been seen there that the rice and wheat distribution target has been reduced in the next financial year 2023-24. In the current financial year, rice and wheat have been reduced from the target of distribution of 2 thousand 3 metric tons to 1 thousand 923 metric tons for the next financial year.