The runaway price hike during this year’s Ramadan is proving particularly difficult for the middle to lower-middle class households in urban areas, for whom a Tk10-15,000 spike in the monthly spend is a big ask.
These are the families that despite living in or near areas where supershops are proliferating, still prefer to buy from the local kaachabazars (kitchen markets). And the principal breadwinner, usually the father, often prefers to visit the bazar and make the purchases himself.
One of them, Kazi Shariful Haque, a job holder at a private local company, told UNB that in any case one has to spend more on food during Ramadan, despite it being the month for restraint, on the food that is consumed during Iftar and Sehri. Consumption of some items like fruits, beef, and mutton, does come down, he conceded.
UNB spoke to Shariful at Kawranbazar, the principal kitchen market in the capital, which he visited just prior to the weekend with a shopping list that contained fruits, vegetables, fish, and chicken, among other things.
He shared that in his experience, most items’ prices jumped by Tk10-30 per kg. Fish prices jumped by Tk100 to 150 per kg, chicken jumped by Tk15 to 20 per kg, while chick-pea, lentil, onion, and garlic ginger are among the items that saw prices jump by Tk10 to 30 per kg, since the start of Ramadan.
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Dates are not available at price set by the government, he said, while apples, malta, and some other fruits are selling at Tk300 to 350 per kg - an increase in the price by Tk 50 per kg. Medium-quality dates are selling at Tk800-1000 per kg, he pointed out.
However, Shariful has found that the prices of rice and edible oil are stable for now, but of course household expenses are not limited to the spending at the bazaar only. In almost every sphere, including medicines (health), water rates, gas rates, electricity, house rent, people are having to spend more and more.
Bills and prices are squeezing the middle class in cities, especially at the lower end like Shariful, who last received a raise at his company two years ago, and in these two years, inflation has been spiking in the country. Even the company he worked for suffered losses in business in these two years, and it made him perceive a period of gloom for the economy.
Still, it makes him yearn for when the times were good for these very same people, as recently as 2-3 years ago.
“In 2021, I could maintain my four-member family in Farmgate, Dhaka along with spending for parents living in the village and even then save a small amount every month. And now I have to maintain family expenditure by drawing on my previous savings,” Shariful voiced his frustration in an annoyed voice.
Shariful’s is the common refrain among most shoppers at the city’s kitchen markets these days.
They make up Bangladesh’s ‘squeezed middle’, a term coined by the former leader of the opposition in the UK parliament, Ed Miliband of Labour, in the aftermath of the global financial crisis of 2009.
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The Oxford English Dictionary, while choosing it as their ‘Word of the Year’ in 2011, defined it as “the section of society regarded as particularly affected by inflation, wage freezes, and cuts in public spending during a time of economic difficulty, consisting principally of those people on low or middle incomes.”
All these conditions are met by the likes of Shariful, and others in his bracket.
Dr Fahmida Khatun, Executive Director of the Centre for Policy Dialogue (CPD) told UNB that inflation and randomly fluctuating exchange rates (affecting the price of imported products) have increased the cost of living in the urban areas, as the urban people are depending on supply chains..
In the rural areas, 60 to 70 percent of items consumed by a family are produced on their own land - which is emphatically not the case in the cities. Most of the middle class is even living on rented property. As a result, the price hikes tend to affect urban life more severely, she said.
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Dr Fahmida said it was not only the prices of consumer goods - health-related expenditure and utility prices have also increased, confirming the observation by Shariful, and others, that UNB spoke to in Kawranbazar.
“Household incomes, mainly salaries, did not increase in the post-Covid period, after having gone down during Covid itself (2020-2022),” Dr Fahmida said. “As a result, jobholders are really bearing the brunt of the price hikes.”
Average wage growth remained well below the inflation rate in Bangladesh for the 22nd month straight in November 2023, as per the Bangladesh Bureau of Statistics (BBS), corresponding to the timeline she provided.
Ghulam Rahman, president of the Consumers Association of Bangladesh (CAB), said that the prices of all types of products have increased, whether those items are imported or produced in the country.
Although the incomes of jobholders did not increase, their expenses have increased alongside that of others, but this has proven a particular burden for the fixed income groups, he said.
He said If prices were hiked “logically and systematically”- presumably meaning adhering to market fundamentals - then this burden would remain manageable. But when it happens arbitrarily, indicating how it happens in Bangladesh, it becomes very hard for the people, said the CAB president.
He advised authorities to pay more attention to whether this is happening, as there are several instances of price gouging, hoarding, etc in the country, and there are laws against these.
Wherever irregularities are found, the perpetrators should be brought under the law, to bring stability to the market, the CAB president urged.
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