Trading Corporation of Bangladesh (TCB) has long been hamstrung by the capital shortfall, making it difficult for the agency to carry out a timely market intervention. Supply of key essentials by the government’s trading arm when prices go up on the open market, especially during the holy Ramadan, is seriously hampered for the shortage of required working capital. Currently, the government has raised the authorised capital of the state-run agency to Tk 10 billion. When middle-class people are coping with the pandemic with the help of subsidized price of essentials by TCB, the capital shortfall may lead to a serious market hazard to the commoners.
The government has provided subsidy amounting to over Tk 3.93 billion to TCB from fiscal year (FY) 2010-11 to FY 2017-18. But the state-run trading agency could not make any visible impact about keeping the market of essentials stable and at a tolerable level for common consumers despite getting a large amount of deficit in financing every year. The cost would become much lower and the consumers would be able to buy goods at an affordable rate if the commodities are imported through cash payment. Sufficient working capital is required for the agency to buy commodities for open-market sale at subsidised rates. Besides, required manpower, the fund for construction warehouses are badly needed for strengthening the capacity of this state-run agency. TCB is passing hard times for storing different key essential items due to lack of necessary warehouses. Market-intervention activities of the state entity could be carried out smoothly if TCB had adequate working capital.
In FY 2012-13, TCB was given Tk 8.0 billion as counter-guarantee from the government, against which it imported different commodities. As TCB sells commodities at subsidised rates, the organisation counts huge financial losses every year. Despite repeated efforts by the state-run corporation, no tangible impact could be seen in respect of market intervention due to procedural delays, manpower shortage and lack of necessary warehouse. The government must act promptly to rejuvenate and equip TCB to ensure essential goods at a subsidized price for COVID-19 affected low-income people in the urban areas.
