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Abstract
Three factors, advent of new technology (HYV), development of infrastructure
and market liberalization working in tandem have delivered favorable food security
outcomes for Bangladesh. Bangladesh’s food-policy has benefited from a liberalized
trade regime and a consistent downsizing of the government, all with favorable effects on
poverty and nutrition. Post liberalization, the findings suggest a perceptible increase in
the cost-effectiveness of the public food grain distribution system (PFDS). The favorable
effects of liberalization are also evident in growths in outputs, market size, the size of
private stocks, the emergence of a two peak harvest seasonality, and finally in declining
real rice prices. The government has moreover downsized the PFDS, making poverty-reduction
a priority basis for grain allocation. While imports relative to total availability
have remained virtually unchanged during the last 25 years, public issue relative to the
availability has fallen by about a half. Average food grain consumption has fallen
slightly during the 1990s but in face of rising incomes, this could partly be driven by
diversifying tastes. Comparing the efficiency of the private and the public sector, the
private marketing margin is slightly higher. In spite of the significant advantage(s)
enjoyed by the public sector, the margin being thin is significant. In order to account for
the expected global changes under the Doha round, simulations using competitive spatial-equilibrium
models for the world’s rice and wheat markets forecast increase in prices for
rice and wheat by 21.7% and 10.1% respectively by 2013. USDA global CGE models
(2001) show figures of increase in wheat prices by 18.1%, and rice prices by 10.1%. These estimates are used in a multi-market model for Bangladesh as estimates for global
price shocks. Sensitivity analysis shows that over a range of values involving both an
upper and a lower limit, small declines will occur in real incomes and caloric levels of
both urban poor and rural landless households, while large farms will experience a small
gain in their real incomes. Based on values corresponding to the lower limit, overall
effects on food security are however quite small.