THE FOODGRAIN SITUATION IN BANGLADESH

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00875R001700040035-8
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 15
• Document Creation Date: December 20, 2016
• Document Release Date: March 30, 2006
• Sequence Number: 35
• Publication Date: October 1, 1972
• Content Type: IM

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Coy#idential
DIRECTORATE OF
INTELLIGENCE
Intelligence Mer~lorand~arri
The Foodgrain 3'ituatio~z in Bernd lad~rh
~aG~\PLi:h,~~~ti',`. "]?c v 1' Confides#ia1 25X1
ER IM 72-152
October 1972
r~pY N~ 3 3 3
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CENTRAL INTELLIGENCE AGENCY
Directorate cf Intelligence
October 1972
INTELLIGENCE MEMORANDUM
THE FOODGRAiw SITUATION IN GANGLADESH
Introduction
1. Since Bangladesh achieved its independence last December, rice
prices have risen sharply, contributing to growing popular anrest and
criticism of the government. Private rice stocks ace unusually low because
of crop failures associated with last year's ~ -~litary activities. As a result
of the civil war that erupted in March 1971, the subsequent exodus of
about 10 million refugees, and the two-week Indo-Pakistani war in
December, rice production in the crop year ending 30 June was the lowest
in five years. Thanks to a massive UN relief effort, large quantities of
foodgrains -mainly wheat -have arrived from abroad acid have been
distributed to the population. Although no severe food shortages have been
reported, Nigh rice prices have persisted, and Dacca anticipates another crop
shortfall this winter. This memorandum evaluates the current foodgrain
situation in Bangladesh and the prospects for the months ahead.
Background
2. Because of the annual rice crop cycle in Bangladesh (see
Figure 1), foodg~ain stocks drawn from dorr.~stic production are normally
at t}ieir highest levels in the early spring, drawn down during the summer,
and replenished in the late fall and winter. There are thr,~e annual rice
craps: the fall (aus) harvest, the winter (aman) harvest, and the spring (boro)
harvest. They represent about 25%, 60%, and 15%, respectively, of am~ual
rice output. The aman crop is grown practically throughout the country
on both highlands and lowlands. It is sown earlier on lowlands to permit
sufficient growth to withstand inundation by monsoon rains. The aus crop
also is w;despre~rd, but has a shorter season and is limited to highlands
Note: This m~;morandum was prepared by the Office of Economic Research
and coordinated within the Directorate of Intelligence.
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Bangladesh: Growing Seasons of Rice Crops
Aman
FGghland
Aman
Lowland
Aus
Flighland
BOfO
Lowland
Sudlln
a
plant
ruwth
Horv
t
S
edlinpa
Growth
Herveat
Plant
Growth
Growth
Herveat
I
Plant
1
S
edllnpa
plont
Growth
Horveat
to a~~oid monsoon flooding. The boro crop, growl.l during the dry season,
is limited by irrigation requirements and is grown mainly in the marshy
northeast. On an annual basin, per capita rice production is greater in some
districts than in others, and an adequate distribution system is essential
l:o avoid local shortages. `n crop year (CY)O 1 ~ 1968, for example, when
foodgrain imports exceed d one million metric tons, eight of the n2tion's
19 districts produced less than enough foodgrains for their populations (see
Figure 2).
3. For more than a decade, total foodgrain production in Bangladesh
1~as been inadequate to feed its rapidly growing population -estimated
cl.Irrently at more than 75 million persons in an area about the size of
Arkansas. Since the early 1 ?60s, annual population growth has averaged
at least 3%, among the highest rates in the world. At the same time, rice
production - which constitutes almost all foodgrain production in
Bangladesh~2~ -did not keep pace with population growth. Consequently,
foodgrain imports rose from 700,000 tons in CY 1961 to almost
1.9 millior: tons in CY 1972 (see Table 1).
1. The crc p year ends 30 June of the stated. year.
2. Only about 100,000 tons of coarse grains are produced annually.
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Eiangladesh: Food Situation, 1968
Rice Production as ~ Percent
cf Requirements'
Eli Above 150
126-150
111.125
101-110
7G?100
~1 50-75
'Assumes i6oz/day pe. person consumpflon
SId2%N fl !;
Figure 2
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Table l
Bangladesh: Rice Production and Foodgrain Imports
Thousand Metric Tons
Foodgrain Imports
Crop
Year'i
Rice
Production h~
Wheat
Rice
Total
1961
9,680
~34
464
698
1962
9,620
202
'105
408
1963
8,870
894
542
1,436
1964
10,630
656
346
1,002
1965
10,50)
250
95
345
19b6
10,500
529
360
889
1967
9,570
647
432
1,079
1968
11,170
712
308
1,00
1969
11,340
884
236
1,120
1970
12,010
1,045
502
1,547
1971
I l ,150
898
38 l
1,279
1972`-~
9,970
1,350
500
1,850
a. Ending 30 June.
b. Only about 100,000 tons of course grains are produced annually.
c. Prcliminury.
4. Sharp declines in rice output during CY 1971 and CY 1972
resulted primarily from the severe 1970 floods and cyclone and tl_
subsequent disruptions caused by military activities. Output fell 7?Io in
CY 1971 and nearly 11% in CY 1972, when it reached its lowest leve%
in five years. The CY 1972 decline would have been larger if not for a
record boro harvest in the spi?i~ig, apparently due to more extensive use
of high-yielding variety seeds and increased acreage for that crop. But in
the following year all three of 'the annual crops registered declines
(see Table 2).
5. In the summer of 1971, there were indications that foodgrain
shortages - pos:;ibly widespread - were almost inevitable because of
transport disruptions stemming from the civil war.~3~ The foodgrain
distribution system clearly had broken down. Rail traffic was disrupted by
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a. Ending 30 Junc.
b. Hecause of rounding, components may not add to the totals shown.
c. 1'rcliminary.
the hostilities, and water traffic was limited by a shortage of boats, ~,ahich
had been confiscated iri large numbers by the Pakistani army. Abut 50%
of imported foodgrains normally move by rail, and most of the remainder
by water. At the same time, up-country movement of foodgrain imports
was stalled at the ports by labor shortages a,r,d the priority assigned to
military supply movements.
6. Serious shortages failed to materialize, however, partly because
some imports were distributed during the civil wa-, despite disruptions, but
plirnarily because about 10 million refugees fled to India between April
and November 1971. Hunger and anticipated food shortages, as well as fear
of tt~e Pakistani army, probably were the derisive factors in the exodus.
In any event, the population was reduced temporarily by ]0% to 1S%,
and food requirements within Bangladesh were reduced accordingly. The
Indian government provided an estimated one miilion tons of foodgrains
to the refugee; during their stay in India.
7. The destri.lction of railroad equipment and bridges by the
retreating Pakistani army last December worsened the food distribution
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problem by reducing rail traffic to only 10"/0 of normal. Civil war disruptions
earlier had already reduced traffic by about one-half. The Pakistanis
destroyed the only railroad bridges across the two principal rivers -the
}~ardinge across the Ganges and the George V1 across the Meghna (see
Figure 3). Destruction of the Hardingc Bridge left the nation's five
Bangladesh: Transport Network 1972
~,
`\
.~`1
Standard ~;ua~r, railroad
Narrow~E;uaE;e railroad
Road
X~
_ 1 I171V ~~
Figure 3
~~
r
~ ~ ' ~hittagon
i ; o ~~~ ~ ~_.~
x:11
~-
Cox's Bazar _
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northwestern districts inaccessible, except by water, from the major ports.
The George VI Bridge had provided the only rail connection between
Chittagong -the major seak~ort -and Dacca. In addition, hundreds of small
bridges were destroyed and many river craft were deliberately sunk to slow
the Indian army.
Development Since the Indo-Pakistani War
8. The foodgrairt situation was only one of a host of economic
problems confronting the new government in Dacca following the
Indo-Pakistani war, but not necessarily the most immediate. The aman
harvest was under way, and the boro crop already had been planted, assur;ng
an adequate food supply for at least several months In addition, food aid
from India became available almost immediately, delivered mainly to the
~~irtually isolated northwest districts. There were reports in January that
the government was rushing fertilizer and pesticides to the countryside in
an apparent effort to increase the aus crop. More recent reports, however,
indicate that in early 1972 the government initiated policies that encouraged
farmers to grow jute -which competes for land with the aus crop -and
favored jute growers with fertilizer and other needed inputs. With food
aid on the way, the government probably reasoned that foreign exchange
was the more critical problem. Jute production, which generates most of
the nation's foreign exchange earnings, had declined by almost 40% between
1970 and 1971.~4> In any event, the aus harvest of August-September 1972,
estimated at only 2.1 million tons, was the smallest aus crop in more than
0 years. On the other hand, jute production reportedly was restored this
year to its 1970 level.
9. The resumption of foodgrain imports soon a'c't~~r the war and a
rapidly mobilized UN relief' effort have combined to avert any serious
foodgrain shortages thus far. During January-September 19', 2, about
2.0 million tons of foodgrains - mostly wheat -arrived from abroad.
Dacca had requested 2.7 million tons for 1972; most of the foodgrains
not yet delivered have already been pledged. Major donors include the
United States ($OO,J00 tons), India (800,000 tons), and Canada
(275,000 tons), including foodgrains pledged but not yet delivered.
10. The UN Relief Operation in Dacca (UNROD) had coordinated
the delivery and distribution of food aid, but the Bangladesh government
generally has managed the ultimate disposition of imported foodgrains.
About 130 UNROD personnel have helped estimate aid requirements,
arrange delivery schedules, and charter river vessels to move food
up-country. Some of the imported food has been distributed directly by
UNICEF members of the UNROD team. Most of the final distribution of
4. Calendar years; the jute crop is harvested in Augus and September.
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CONFIDENTIAJ.,
imported food, however, occurs through the network of ration shops
maintained by the government's Ford Corporation. Food ration cards
reportedly have been issued to about one-fourth of the population, with
eligibility determined g~nerrlly by income. In the urban areas of Dacca,
Chittagor;g, and Naray4nga~-~j, however, the entire population currently is
eligible for ration shop foodgrains. The weekly foodgrain ration per "adult"
(eight years of age and older) is about six pounds. Some of the refugees
returning from India, and disaster victims, are given flee food; otherwise,
cardholders pay the fixed government ration price.
11. Rising free market rice prices during the summer of 1972
apparently reflected hoarding, profiteering by speculators, and reported
COrrllpt1011 among government foodgrain officials. The Bengali preference
for rice. over wheat also contributed ro the sustained demand for rice in
the presence of large wheat supplies. Free market rice prices rose almost
steadily throughout the country, at least through August, but declined
sli.;htly in September, probably because the aus crop had reached ?he
markets (see Table 3). Rice reportedly was selling at twice the previous
year's price in some areas, generating some anti-government demonstrations.
In the summer of 1971, by contrast, rice prices displayed only the usual
se:~sonal variations, despite ttie threat of serious food shortages at that time.
The refugee flight to India reduced pressures on prices, and the prevailing
mood of unity among the Bengalis probabiy inhibited hoarding and
profiteering.
12. In an effort to hold the line on prices and insure more equitable
distribution, in early October the government announced that it would open
about 4,700 "fair-price" shops to distribute rice, wheat, sugar, edible oils,
and other haste consumer items. The relationship between these shops an%i
the existing ration shop system was not explained, although the latter served
only holders of ration cards and the former will probably serve the entire
populace. Nor was it clear whether, under the new system, the government
would increase its rice procurement price sufficiently to increase its rice
stocks. The government has set the price so low that in recent years it
has procured only about 6,000 tens annually, mainly from border areas
where, to discourage smuggling, the sale of surplus rice to the government
is mandatory. Because only one-fourth of imported foodgrains consist of
rice, the government's rice supply apparently has been inadequate for the
consumer demand from its ration shops.
13. UN personnel have been indispensable in handling the rapidly
accelerating import arrivals and in overcoming transport bottlenecks to move
ample food supplies trp-country. The number of deficit districts is
considerably larger than normal this year (see Figure 4), and. the main rail
bridges have yet to be restored, so that grain must be moved mainly by
boats. Repair of the George VI Bridge will not be completed until at least
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'rabl~ 3
Dan~lndesh: Free Market Rice Prices, by District
'l'akes per Maundy
Jan
uary 1972
(A
verage)
26 August 1972
22 September 1972
All districts, avcrtgc
41.5
70.2
66.5
Dacca
45.2
72.0
71.2
Khulna
46.3
75.U
G8.8
Chittagong
41.7
69.U
57.0
Dinajpur
34.8
62.5
67.5
Kajshahi
45.0
73.0
64.0
13ogra
38.8
7U.0
60.0
Mymensingh
34.0
75.0
73.8
'rang:til
39.0
72.0
71.0
F3urisal
44.5
63.0
65.4
PatuakhaG
N.A.
64.0
62.0
Sylhct
35.5
75.0
65A
Faridpur
46.7
74.8
72.2
Comilla
41.5
74.0
67.3
Noakhali
N.A.
u6.0
68.8
Pabna
45.8
67.5
68.7
Jessorc
48.6
75.U
66.9
Kushtia
49.9
70.U
64.3
R:tngpur
32.6
80.0
75.5
Chittagong Hill Tracts
N.A.
58.0
57.3
late 1973. Raising the collapsed span of the Hardin;e Bridge was under
way in early summer but was delayed by the monsoon and was scheduled
for completion in October. Thanks mainly to the UN effort, boats have
successfully replaced the railroads temporarily in moving foodgrains to
deficit areas. Foreign donors have contribuf:ed various types of river vessels
as well as fonds for chartering of private vessels, so that sufficient river
boats have been available. The US supertanker Manhattan has been anchored
off Chittagong since early August, serving as an offshore warehouse and
relieving the congestion at Chittagong's harbor.
Prospects
14. UNROD spokesmen in Dacca estimate that current foodgrain
stocks and import commitments will be adequate to meet requirements at
least until the amen harvest begins in November. Public foodgrain stocks
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Bangladesh Food situation, 1972
'Assumes 16ozldny per person consumption
514279 P-72
Rice Production as a Percent
of Requirements'
126.150
111-125
101.110
76-100
~ 50.75
f? Below ?~
Figure 4
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in late August were about SOU,000 tons, inclu;ling 78,000 tons of rice and
over 400,000 tons of wheat. Imports of about 280,000 tons arrived in
September, and about 550,000 tons were expected during
October-December. The United Nations has requested an additional
175,000 tons, which would raise total imports for the calendar year to
2.7 million tons. Dacca had hoped fora 12 million ton harvest during
CY 1973, but the goal appears to be out of reach. The crop year started
poorly with an aus Harvest of little more than 2 million tons. Dacca
estimates the upcoming aman harvest at 5.8 million tons, and even a
favorable born crop next spring would raise total production for CY 1973
to about 10 million tons -about the same as the CY 1972 crop. The
aman crop has still to be exposed to the cyclone season in the fall, and
the boro crop faces the uncertainties of fertilizer supplies as well as weather.
About one-half of the boro crop is slated to consist of high-yielding rice
varieties, which require much larger doses of fertilizer than traditional
varieties in order to produce optimum yields. Dacca depends on foreign
aid donors for most of its fertilizer; neither of its two fertilizer plants is
operating anywhere near capacity.
I5. Dacca's ability to control food prices during the next month or
two, wlulc assuring adequate foodgrain supplies through its fair-price shops,
will largely determine whether the poorer classes can avoid extreme
Hunger -and in some cases possibly starvation. The price situation is
ominously similar to price developments preceding the 1943 famine in
Bengal, which included the region that is now Bangladesh. That famine
claimed 1.5 million to 3.5 million lives. The rice supply at that time seemed
adequate, but prices rose sharply beginning in July until rice was beyond
ttte reach of the poor, and starvation ensued. The spiraling prices were
attributed to speculation, hoarding, and profiteering. At that time, however,
war conditions had divested the region of its major external supply source --
Burma -and heightened fear of shortages among the populace. The UN
presence in Bangladesh probably will avert a similar disaster. Although wheat
is unpopular among Bengalis, it will be preferable to high-priced rice and
certainly to no food at all.
16. India, which now has foodgrain supply problems of its own, is
not likely to play a significant role in supplying foodgrains to Bangladesh
in the ~~rrrent crop year. New Delhi's foodgrain stockpiI~s had reached a
record 9 million tons in early 1972, when it provided substantial food
assistance to Dacca. Since then, however, a late and erratic monsoon reduced
crop expectations and prompted New Delhi to tig`rten distribution
procedures and extend its price controls in order to prevent hoarding. India's
foodgrain stockpiles probably have declined since August. Threatened
shortages in India and a black market currency exchange rate favoring India
have apparently increased smuggling from Bangladesh to adjacent Indian
states, further exacerbating Dacca's supply problems.
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17. The United Nations, which has conducted relief operations in
Bangladesh since the 1970 cyclone, plans to dismantle its operations in
March 1973. It is uncertain, however, whether the government will be able
to supply deficit areas independently by that time. The new government's
Food Corporation, operating with UN support since its inception, has yet
to be tested. Before indcpender,ce, West Pakistanis had played key roles
in food distribution. In addition, most Bengali food administrators who
worked during the civil war have been dismissed as "collaborators."
Resumption of rail service, especially over the Hardinge Bridge to the
northwest districts, will simplify Dacca's tasks considerably. Foreign
donations will certainly be forthcoming, but adequate distribution within
the country will require a continuing massive effort by Dacca, and may
well require foreign transport assistance beyond next March.
Summary and Conclusions
18. Despite a sharp decline in rice production and serious disruptions
in the nation's railroad system, massive foodgrain imports and a
UN-coordinated effort to supply food-deficit areas by boat have averted
serious foodgrain shortages in Bangladesh. Rice production in the Saar
ending 30 June was less than 10 million tons, down 17% from two years
earlier. However, about 2.0 million tons of foodgrains were imported during
January-September, and delivery of an additional 0.7 million tons is
expected by year's end. The United Nations has coordinated the distribution
of imported foodgrains to needy areas, mainly by chartered river vessels,
because major railroad bridges are still not repaired.
19. The total foodgrain supply s adequate, at Icast until the main
harvest beginning in November, and internal distribution is not the problem
it was last year. Most imported foodgrains leave consisted of wheat, however,
and tl~e Bengali penchant for rice apparently contributed to rapidly rising
rice prices during the summer. Hoarding and profiteering also reportedly
were involved in the high rice prices. Prices declined in September, however,
when the aus rice crop reached the market.
20. The short-term crop outlook is discouraging: the fall crop just
harvested was the smallest in more than 10 years, and the major crop to
be harvested in November-December is not expected to be any higher than
last year's. Foodgrain imports most certainly will be required beyond
March 1 x'73, when the UN relief operation is scheduled to leave. Dacca
has not made known its plan for taking over the role of the United Nations
at that time, but will likely have difficulties in distributing imported
foodgrains without foreign transport assistance.
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