The International Monetary Fund (IMF) has created pressures on Bangladesh to raise the prices of petroleum products and gas despite Bangladeshi government ruled out recently that prices of the items would be increased in near future.

"Bangladesh cannot afford the financial losses and economic costs stemming from the under-pricing of energy products," an IMF team now in Bangladesh told the government, private television Ntv reported Thursday.

The IMF argued that the implicit subsidies arising from the under-pricing of petroleum products and natural gas benefit the richer households much more than the low-income group.

Bangladeshi Finance Minister M Saifur Rahman agreed with the views of IMF. "I am fully agreed with them. Because, if prices are not adjusted with the global market prices, it's impossible to face the challenges of achieving the targeted 7 percent growth of the economy."

Noted Bangladeshi economists Dr Wahiduddin Mahmud and Devpriya Bhattachary in line with the finance minister of Bangladesh suggested the government to rise the prices of petroleum products at a tolerable level.

But Mahbubur Rahman, Adviser of the Ministry of Mineral Resources ruled out the possibility of raising the prices of petroleum products.

Political observers here said Rahman just echoed the intention of the top policymakers of the government. The observers said apparently the government is unwilling to increase the prices of petroleum products not to harm their vote bank ahead of the national election due in January next year.

A five-member IMF delegation headed by its Adviser Thomas Rumbaugh arrived here on April 30 to review the economic developments and implementation status of policies supported by the IMF's Poverty Reduction Growth Facility (PRGF) before approving the sixth PRGF loan installment of 80 million U.S. dollars.

Source: Xinhua