The Trading Corporation of Bangladesh (TCB) has requested over Tk 14.11 billion in subsidies from the government to mitigate its financial losses incurred from selling essential goods at reduced prices, according to sources.

Recently, the state-run agency sent a letter to the commerce ministry asking for necessary actions to secure the requested subsidy amount for the July-December period of the previous fiscal year, as reported by them.

The Ministry of Commerce (MoC) has already passed the request letter to the Ministry of Finance, urging it to take the required steps in this matter.

The TCB has sold various essential items, including edible oil, lentils, and sugar, at subsidized rates to approximately 10 million lower-income beneficiaries, with the goal of stabilizing their market prices.

As per available information, the TCB procured 0.107 million tonnes of lentils for over Tk 12.41 billion and sold them for Tk 5.87 billion, resulting in a trade deficit of Tk 6.54 billion, according to official sources.

The state trading agency also encountered a trade gap of Tk 36.77 million from selling 448 tonnes of sugar for Tk 28.3 million, compared to its procurement cost of Tk 65.60 million.

Additionally, the TCB acquired around 94.9 million litres of soybean oil for Tk 16.91 billion and sold it for Tk 9.37 billion, leading to a loss of Tk 7.54 billion.

A senior official informed the FE that the TCB had to borrow funds from banks at interest rates between 9.0 percent and 12 percent, noting that these elevated rates increased its overall commodity procurement expenses.

Moreover, the TCB was required to pay a 2.0 percent income tax on its commodity sourcing from the local market and incurred operating costs of Tk 5.0 and Tk 7.0 for each kg/litre of the products sold.

Previously, TCB requested approximately Tk 100 billion in funding directly from the government to reduce its reliance on expensive bank loans, according to a source. Currently, TCB offers essential goods each month at subsidized rates, focusing on the lower-income demographic.

Most recently, the government has opted to add five additional items to TCB’s list of essential goods starting in November. The new items include: tea, salt, detergent, and two varieties of soap.