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Trade subsidies, export bans and price stabilization: Lessons of Bangladesh–India rice trade in the 2000s

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  • Dorosh, Paul A.
  • Rashid, Shahidur

Abstract

During the world food price crisis of 2007–08, rice importing countries suffered through a sharp increase in international rice prices and disruptions in supply as several rice exporters restricted trade to mitigate their domestic price increases. Perhaps no country was more affected by these disruptions than Bangladesh. Our analysis shows that prior to the 2007 crisis, when Bangladesh imported an average of nearly 1 million tons of rice per year from India, domestic wholesale prices of rice in Bangladesh were co-integrated with import parity prices of subsidized Below Poverty Line (BPL) rice. When in mid-2007, India sharply curtailed exports, rice prices surged in Bangladesh.

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  • Dorosh, Paul A. & Rashid, Shahidur, 2013. "Trade subsidies, export bans and price stabilization: Lessons of Bangladesh–India rice trade in the 2000s," Food Policy, Elsevier, vol. 41(C), pages 103-111.
    • Handle: RePEc:eee:jfpoli:v:41:y:2013:i:c:p:103-111
    DOI: 10.1016/j.foodpol.2013.05.001
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    2. Zhang, Xiaobo & Rashid, Shahidur & Kaikaus, Ahmad & Ahmed, Akhter, 2021. "Escalation of real wages in Bangladesh: Is it the beginning of structural transformation?," IFPRI book chapters, in: Securing food for all in Bangladesh, chapter 10, pages 343-374, International Food Policy Research Institute (IFPRI).
    3. Ashrafun Nahar & Jeff Luckstead & Eric J. Wailes & Mohammad Jahangir Alam, 2018. "An assessment of the potential impact of climate change on rice farmers and markets in Bangladesh," Climatic Change, Springer, vol. 150(3), pages 289-304, October.
    4. G.M. Monirul Alam & Khorshed Alam & Shahbaz Mushtaq, 2018. "Drivers of Food Security of Vulnerable Rural Households in Bangladesh," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 19(1), pages 43-63, March.
    5. Traverso, Silvio & Schiavo, Stefano, 2020. "Fair trade or trade fair? International food trade and cross-border macronutrient flows," World Development, Elsevier, vol. 132(C).
    6. Burhan Ahmad & Ole Gjølberg, 2015. "Are Pakistan’s Rice Markets Integrated Domestically and With the International Markets?," SAGE Open, , vol. 5(3), pages 21582440155, July.
    7. Serge Savary & Sonia Akter & Conny Almekinders & Jody Harris & Lise Korsten & Reimund Rötter & Stephen Waddington & Derrill Watson, 2020. "Mapping disruption and resilience mechanisms in food systems," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 12(4), pages 695-717, August.
    8. Rude, James & An, Henry, 2015. "Explaining grain and oilseed price volatility: The role of export restrictions," Food Policy, Elsevier, vol. 57(C), pages 83-92.

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