In the past, Bangladesh had bought foodgrains mostly from neighbouring countries like India, Myanmar, Thailand and Viet Nam, to meet a shortfall in its domestic production. Because of repeated floods and natural disasters, crop production often suffers especially in low lying or coastal areas of Bangladesh.

A couple of years ago, a worldwide shortfall in foodgrains production had led to an increase in the price of rice, wheat and other items in the international market. Bangladesh had been hit hard by shortages, angry demonstrations and public anger. It had pressed India to release immediately 500,000 tonnes of rice that it had been promised by its larger neighbour. This, coupled with the worldwide effects of the economic recession in the wake of the sub prime brokerage crisis in the US, had threatened to snowball into a disaster for developing countries.

Fortunately in 2010, along with India, Bangladesh is one of the few countries which seems to have weathered the storm more effectively than others. Domestic food production is good, remittances from abroad healthy and foreign exchange reserves have just crossed a record $11 billion. This has been achieved despite the international recession and two major natural disasters, Sidr and Aila.

But as with most other disaster-prone countries, special provisions have to be made for accidents. Even in 2008, authorities had to make available foodgrain supplies to 5,70,000 poor people for five months, while selling 45,000 tonnes of rice under controlled rates. It was reported that the really poor could not buy rice even at those rates. The country had to make large purchases from Viet Nam, Thailand, India and Myanmar to combat the situation.

Fortunately, there is no such pressures at present, and India will sell 1,00.000 tonnes of rice and 4,00,000 tonnes of wheat, through the State Trading Corporation and the Food Corporation of India, respectively. Prices and other details will be worked out at later meetings in Dhaka.

Agreement between the two countries was worked out during the visit to New Delhi of a Bangladeshi delegation a few days ago. This will be followed by an Indian delegation visit to Bangladesh. (IPA)