DHAKA, June 20 (Xinhua) -- Bangladesh has cut import duty on rice to 10 percent from 28 percent in a bid to rein the instability in prices of the staple food item in the domestic market.
Bangladeshi Commerce Minister Tofail Ahmed made the announcement at a press briefing Tuesday in capital Dhaka, a move hailed by experts.
He said prices of rice are expected to fall by 6 taka per kilogram as a result of the duty reduction.
Officials say a gazette will be issued in this regard soon.
Owing to higher import duty placed back in 2015 and 2016 in a bid to safeguard local farmers amid cheap prices from neighboring countries, rice import has dropped to a four-year low this year.
Local importers blamed a 28-percent tariff on rice import for the decline.
As the domestic rice market has again become volatile in the wake of reports that paddy production is likely to fall this year due to flash floods and rice blast disease, prices of rice continued to soar since April.
Against this backdrop, the Bangladeshi government has strengthened its efforts to build buffer stock of rice through quick import.
The Bangladeshi government last week decided to import rice from Vietnam for more than 39 taka a kilogram.
The state-run Trading Corporation of Bangladesh reportedly recorded a 47-percent hike in the prices of coarse rice this month compared to the same period last year.
Price hike of food items particularly staple rice is a key concern for the Bangladeshi government as nearly 31.5 percent of its around 160 million people still live below the national poverty line and spend a large part of their incomes on food purchase.
Flash Flood struck the country's northeastern region in March, causing huge loss of Boro (Winter) rice. Apart from this, rice blast disease has also affected boro rice production elsewhere in the country.
Against such circumstances, prices are seen rising in the short term on a supply shortage.
Experts hailed the duty reduction decision, saying it would surely help the government's effort to rein in the market through boosting imports by both the government and private channels. (1 U.S. dollar equals 81 taka)
