Govt to distribute 10 KG rice to each of the 1.25 crore ultra-poor families

The government is set to distribute 10 kilograms of rice to each of the 1.25 crore ultra-poor and destitute families ahead of Eid-ul-Azha to soften the blow of spiralling inflation.

The disclosure was made yesterday by Enamur Rahman, the state minister for disaster management and relief, after a meeting of the Executive Committee of National Economic Council with Prime Minister Sheikh Hasina in the chair.

At the meeting, PM  Hasina expressed concerns about the escalating prices.

In May, inflation hit an 11-year-high of 9.94 percent, taking the average inflation so far this fiscal year to 8.95 percent, way above the target of 7.5 percent.

"People are suffering due to inflation -- it is everyone's responsibility to fight against inflation," said Planning Minister MA Mannan quoting the prime minister as saying.

Subsequently, she instructed the respective ministries to find ways to give people respite from the soaring price level.

After PM raised her concern, Rahman informed the meeting about his ministry's plan for the poor ahead of Eid.

The rice, which is already being shipped to the districts, will be distributed through the deputy commissioner's office before Eid, said a top official of the Ministry of Disaster Management.

Meanwhile, at the meeting, 16 projects worth Tk 24,362 crore were approved.

Of these, nine are revised projects where the cost escalated by 52.82 percent to Tk 19,835 crore. The original cost was Tk 12,989 crore. Many of the projects were revised two to five times.

Three projects were taken for the rural development of Chattogram and Rajshahi divisions and three districts including Noakhali, Feni and Laxmipur. The estimated cost of the projects is Tk 8,160 crore.

While approving the projects, Sheikh Hasina quizzed why the projects are not implemented with foreign funds as many of the development partners are interested in such projects.

Had the projects been implemented through foreign funds, it would quell the inflationary pressure and shore up strained foreign currency reserves.

"I am approving this. But the concerned ministries will have to find foreign funding to implement these," said a top official quoting Hasina as saying.

In response, an official of the Economic Relations Division, the government wing that negotiates foreign loans, told the prime minister that such projects never come to their desk.

They would have sought funds from the development partners if they got it beforehand.

From now onwards, such project proposals would be forwarded to the ERD to solicit foreign funding, said a planning ministry official.

"Huge volumes of foreign loans remained unutilised in the pipeline. If these can be used, it will reduce the pressure on local currency and increase foreign currency reserves," Mannan told reporters after the meeting.

At the meeting, the prime minister instructed the finance and ERD secretaries to take measures to utilise more foreign loans.

More than $50 billion of foreign loans is remaining unused in the pipeline, said Shamsul Alam, the state minister for planning.

The interest rate for foreign loans is only about 3 percent whereas the interest rate for domestic borrowing is 7 percent.

Using foreign loans will reduce expenditure and increase efficiency in the education, health and energy sectors, he added.

One of the three projects that got approval at the Ecnec meeting is taken to improve connectivity such that farmers can get a fair price for their produce in Chattogram.

Under the project worth Tk 3,110 crore, about 1,149km of roads will be improved in 67 upazilas of the Chattogram division.

Another project involves extending 783 km of upazila roads and 44 km of union roads in Rajshahi division's 65 upazilas for Tk 2,400 crore.

A similar project will be taken for Noakhali, Feni and Laxmipur involving Tk 2,650 crore.

Asked why these projects are being taken up now when there is little fiscal space, Mannan said: "Rural connectivity is very important for the country as it is the lifeline of the rural economy. These are not luxurious projects. We are not constructing four lanes or six lanes now."