FOOD SITUATION - CDA, A.I. MEETING WITH FOOD AND

C O N F I D E N T I A L SECTION 01 OF 02 DHAKA 001882

SIPDIS

SIPDIS

PASS TO: USAID/ANE MARK WARD, USAID/DCHA/FFP, USAID/OFDA;
EMBASSY NEW DELHI: AGRICULTURE COUNSELOR HOLLY HIGGINS

E.O. 12958: DECL: 12/03/2022
TAGS: EAGR ECON POL BG
SUBJECT: FOOD SITUATION - CDA, A.I. MEETING WITH FOOD AND
DISASTER MANAGEMENT OFFICIALS

REF: DHAKA 1836

Classified By: CDA a.i. Geeta Pasi for reasons 1.4 (b) and (d)


1. (C) Summary: CDA a.i. and ADCM met with the top civilian
officials of Bangladesh,s Ministry of Food and Disaster
Management. They reviewed current food shortage statistics
and causes. The GoB officials explained that without
sufficient Government food stocks, open market prices for
grain are susceptible to opportunistic price gouging by
traders. A lack of clarity remains on the level, timing, and
modalities of food aid from other countries. End Summary.


2. (U) CDA a.i. and ADCM met on December 2 with Tapan
Chowdhury, the Adviser responsible for the Ministry of Food
and Disaster Management (MFDM),and Dr. Ayub Miah, the MFDM
Secretary. Chowdhury thanked the CDA a.i. for the USG,s

SIPDIS
prompt assistance in response to Cyclone Sidr,s
devastation(REFTEL). Chowdhury said that Adviser M.A. Matin,
who is coordinating relief activities in Barisal, has been
complimentary regarding the U.S. assistance.


3. (SBU) The CDA a.i. updated the Adviser on the progress of
joint U.S.-Bangladesh relief operations. The CDA a.i.
explained that the US military,s unique humanitarian
response capabilities will only be available for a limited
period of time, and that it is crucial for the Government of
Bangladesh to take full advantage of these capabilities while
they are present.


4. (C) Chowdhury explained that the GOB is focused on
providing relief in the most effective manner possible.
Chowdhury said that he would be heading to Barisal for a
two-day visit to the cyclone-affected areas and to directly
observe the relief operations. Chowdhury complained that
some politicians and media outlets sought to create a
controversy over the presence of the US military for the
humanitarian mission, but he also dismissed these groups as
fringe elements.


5. (SBU) Turning to the food situation, Chowdhury said that
food shortages are ¬hing new8 in Bangladesh. The
current situation is that action is needed now to avoid a
future crisis with Bangladesh,s national food security
reserve, the Public Food Distribution System (PFDS).
Chowdhury said that those affected by the cyclone would be
eligible for the PFDS emergency safety net activity now and
the Vulnerable Group Feeding (VGF) program until March.
After March, cyclone affected populations would be able to
benefit from the PFDS,s Open Market Sales (OMS) program.
(Comment: In addition to timely response to emergency
situations, the PFDS also serves to stabilize domestic food
grain prices to prevent excessive price hikes. End Comment.)

6. (SBU) Chowdhury explained that because of losses from this
year,s two earlier seasonal floods, the GOB had only been
able to procure locally 700,000 Metric tons (MT) of food out
of its 1,200,000 MT target for supplying the PFDS. As a
result of the cyclone, the anticipated procurement from the
next crop will be down by 200,000 MT, leaving a net deficit
of 700,000 MT for local procurement.


7. (C) The GOB is concerned that if it draws down its food
stocks, grain traders will take advantage of the situation by
engaging in price gouging. He said that the GOB needs to
maintain 800,000 MT of food in its PFDS stocks at all times,
and the current stock level was 742,000 MT. Chowdhury noted
that the GOB (through the PFDS) only supplies 20% of the food
demand, with the remainder supplied by the private sector.


8. (C) CDA a.i. asked Chowdhury about the announcement during
the Indian Foreign Minister,s visit that India would allow
the export of 500,000 MT of food to Bangladesh. Chowdhury
welcomed India,s decision but confided that the GOB had
requested from India a higher amount of 1,000,000 MT.


9. (C) The Adviser told us that both the private and public
sector would be able to import food from India under this new
provision, and admitted that the private sector would be able
to move more quickly. Chowdhury conceded that the PFDS,
procurement systems are very slow, and indicated that the GOB
would likely waive the normal tender provisions. He

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anticipates that the private sector will import 300,000 MT
from India, and the PFDS 200,000 MT. He said that unlike in
the past, there are now a number of private traders with the
capacity to import food quantities in the range of 20,000 to
30,000 MT each.


10. (C) When asked whether the GOB will accept the offer by
the World Food Program (WFP) to procure food on its behalf,
Dr. Miah said it was not likely. Miah explained that the WFP
charges a 12% overhead on purchases, and that it would be
difficult for the GOB to allocate funds to the World Food
Program for procurement. Regarding the WFP,s worldwide
appeal for food to address the immediate needs of the Cyclone
Sidr victims, Chowdhury said the GOB would prefer the food
not be procured in Bangladesh. The GOB prefers that donors
procure food outside Bangladesh to avoid driving up domestic
prices. Chowdhury said it was still an open question whether
WFP or other donor procurement of food from India would count
toward India,s 500,000 MT ceiling announced during the
Indian Foreign Minister,s visit.


11. (C) The Adviser said that the GOB was still assessing
what other donor contributions are forthcoming. The Indians
had promised 50,000 MT, and Pakistan 10,000 MT, but it is not
known when this aid will arrive. He said that the Saudis
promised $100 million in aid, of which 100,000 MT could be
food. In the past, however, the Saudis procured food locally.
The GOB is also considering importing food from Thailand and
Pakistan. Thus far, the GOB has 100,000 MT of purchased food
in the pipeline, and another 150,000 MT in process.
Chowdhury shared the figures and calculations the GOB has
used to derive the outstanding food requirement of 1,000,000
MT. Of this total, he confirmed that the GOB was still
seeking 500,000 MT of food aid from donors.


12. (U) In response to the open-ended request for food
assistance, we confirmed that USAID is looking closely at
Bangladesh,s food requirements and that we are considering
how we might help beyond the $15 million already announced.
We suggested that our experts might need to talk further with
the GOB to refine the requirements; the Adviser welcomed
further inquiries from us.

Pasi