A view on Taka�s falling value
One hears plenty of inspirational
rhetoric from
government
leaders to the effect that people�s income are growing and people in increasing number are escaping to
an existence above
the poverty line. But some searching eyes see it
differently
Rezwan Siddiqui
Small people put away some money as savings out of a thinking that the unspent money would buy them goods and services in value in the same or near the same measures like when they had put aside that amount. When they find to their great dismay that theirs saved amounts will not even buy a fraction of the things bought in the past five or ten years down the road, not only this makes a mockery of the advice that people should save for their own good and that of the national good, it also involves great hardships for the savers.
People in the normal walks of life and they are the overwhelming majorities in all countries, are not adept at cunning, crimes and other qualities that would enable them to stay ahead of living costs no matter however high they may soar. They have no choice but to plan their future and the costs of living must fill the slots they have projected ; otherwise they must be poorer with their money resources proving to be far short of what would be required to maintain even their current lifestyle sometime in the future.
Salaried persons have their provident funds, terminal benefits, gratuities, saving deposits in banks and in other schemes. They make a sacrifice in their current consumption and keep aside the amounts out of a hope that the same will fulfill their requirements for ready cash to materialise plans such as building of a house, buying of an apartment, paying for a daughters marriage or a sons higher education and so on.
But when such a saver finds out how worthless his painstaking saving effort for a long period has been from the plummeting value of the currency, then his or her great bitterness and frustrations should be understandable to all those who had suffered in the same manner.
This writer knows a gentleman who retired as a mid-ranking civil servant two years ago. He has a plot of land in Dhaka which was purchased many years ago when land prices were reasonable. He had planned for the day when he would build a house on it in the sunset years after his retirement. The various estimates of house building materials at the time when he started saving for the purpose gave him assurance that he would be in a position to build a house even without taking a loan from the House Building Finance Corporation (HBFC). But all his dreams have been shattered.
After retirement and the settlement of his dues such as provident fund, gratuity, insurance payments, etc., he found out that what he possessed as monetary resources were largely insufficient by todays requirements to either build a decent house or pay well for occasions such as the wedding expenses of his grown up daughter and even the private university fees of his only son.
Thus, this gentleman seems headed for a fate which is dismal to say the least. He would be forced, it seems, to change his status from one having a middle class existence to a lower one or worse, fairly soon. He had to leave his government quarters after retirement and finds renting accommodation in a decent place or apartment in the city financially stressful.
The amount of money he has as retirement benefits would last long many years ago when Takas value was higher and held steady. But this amount is not enough today to enable him to live in middle class comfort for some years in succession. So, he had to practice caution and count his money while renting a home in a rather unattractive area of the city that led to his declassing of sorts.
The present rate of inflation in Bangladesh is, officially, near to 7 per cent. But unofficially the rate is considered to be higher. Whether it is inflation in the economic sense or the outcome of unethical businesses practices, peoples experience is that the value of their savings have been eroding continuously without a pause.
The loss of Takas value used to be not so quick in the past. The only difference now is that this loss has been accelerating in recent years that has created a specter of a vast number of people getting declassed and actually going down in the class hierarchy. One hears plenty of inspirational rhetoric from government leaders to the effect that peoples income are growing and people in increasing number are escaping to an existence above the poverty line.
But to truly searching eyes the realities are different from middle class people turning into lower middle class ones and the latter in turn joining the ranks of the poor. The story is also one of the poor turning poorer from living costs fast outpacing earnings and buying powers of non affluent sections of people decreasing dramatically from the lower purchasing power of the currency as such or the lowered value of their savings.
This process must stop to make any sense out of the talks of poverty reduction and to this end it is supremely important to stabilize the value of the Taka. In a country like the United Kingdom, for instance, the annual inflation rate seldom rises above 2 or 3 per cent and, if it does, it creates a great hue and cry for bringing the same down at the fastest. People there are found to be very disagreeable to compromise their present and future living standards by passively allowing their living standards to decline from losses in the value of the Pound or in their savings.
No such concern is seen in Bangladesh where it matters to really fight inflation, price rise or irrationally higher living costs whatever the name or the ills that lead to erosion in the value of the currency. But a huge number of people in the country are suffering due to such unconcern.
The writer is a contributor to The Independent
