Why had Bangladesh failed to achieve self-sufficiency in food in the past?
In seeking our answer to this issue, we should probably look at the incentive structure, particularly the decline in the real price of rice over the last several decades and the increase in input prices, which further eroded the profit margins for the farmers. Real food prices were 4 times higher in 1975 at their historic peak (no wonder Bangladesh had a famine around that time) compared with the historic lows it reached during 1996-2001. The fact that Bangladeshi farmers could meet the growing domestic consumption needs, and limit the import requirements at around 5 percent over several decades despite such a steady decline in the real food price and a steady decline in arable land, are remarkable achievements. This was possible due to productivity gains through expansion of irrigation, adoption of HYV rice and increased use of fertilisers at subsidised prices. Bangladesh could have become a rice surplus country if successive governments did not allow real rice prices to fall by such
