Food ministry seeks Tk4,150cr more for subsidies, rice import amid rising demand
Ministry proposes increasing rice imports allocation from Tk2,898cr to Tk6,270cr
The Ministry of Food has requested an additional Tk4,150 crore in the revised budget for FY2024-25 to cover increased food subsidy and rice import allocations.
This reflects a 75% rise in food subsidy requirements, driven by heightened demand for rice and flour under government programmes like open market sale (OMS), prompted by soaring market prices of essential commodities.
According to ministry sources, Tk2,004 crore was allocated in the original budget for food grain subsidies under OMS. The revised estimate proposes raising this to Tk3,506 crore.
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Similarly, the Food Friendly Programme's subsidy allocation is expected to increase from Tk3,258 crore to Tk3,290 crore.
These adjustments would bring the total food subsidy budget to Tk6,796 crore—an increase of Tk1,532 crore over the original allocation.
A senior ministry official, requesting anonymity, said that OMS allocations to dealers are currently double the usual demand.
"Buyers often return empty-handed from OMS shops and trucks. Additional supplies are needed, requiring more subsidies, with over Tk20 subsidised per kilogram of rice," he said.
Doubling rice import allocation
Meanwhile, the ministry has proposed doubling the rice import allocation from Tk2,898 crore to Tk6,270 crore in the revised budget to ensure sufficient stock.
This includes Tk438 crore for clearing previous import liabilities.
The proposal comes as domestic procurement targets are unlikely to be met and international rice prices, along with the dollar exchange rate, have surged.
At the same time, the ministry has suggested reducing the wheat import allocation from Tk2,898 crore to Tk2,144 crore, citing lower expenditure in this sector.
As of January 5, government food stocks included 792,560 tonnes of rice and 417,917 tonnes of wheat, according to the Ministry of Food.
Government procurement data shows 249,472 tonnes of rice procured domestically as of 2 January.
Rising demand for subsidised foods
OMS operates in Dhaka and other key areas, including city corporations, labour-intensive districts, and municipalities.
It runs 912 sales points offering rice at Tk30 per kg and flour at Tk24 per kg, with a 5 kg limit per buyer.
The Food Friendly Programme, targeting five million rural families, provides 30 kg of rice per family at Tk15 per kg during five months of the year.
In FY2024-25, 7.40 lakh tonnes of rice were allocated for the Food Friendly Programme.
From 1 July to 26 December, 577,817 tonnes of food grains were sold through OMS, 36,000 tonnes more than the same period last year.
However, high inflation has intensified the pressure on low-income households.
In November 2023, food inflation stood at 13.80%, and wage growth lagged at 8.10%, according to the Bangladesh Bureau of Statistics.
Buyers are flocking to OMS centres, often waiting hours for basic supplies. At Dhaka's Shantinagar OMS centre, buyer Md Ibrahim reported standing in line for two hours on Sunday to secure rice, while many were left empty-handed.
