The recent fall of Sheikh Hasina's government has triggered a series of crises in Khatunganj, Chattogram’s largest wholesale market.
The instability has severely impacted the import and supply of consumer goods, with the S Alam Group emerging as a key factor in the market turmoil.
As the S Alam Group, one of Khatunganj’s most influential industrial groups, faces increasing pressure, the crisis has deepened.
Reports indicate that cheques from nine banks, including seven banks associated with S Alam, are not being cashed despite sufficient funds in the accounts.
Traders fear that this may lead to a significant downturn in business at the country’s second-largest wholesale market for consumer goods.
Business leaders have called on the government to intervene swiftly to restore control over the banks and protect customer deposits. They are urging Bangladesh Bank to take immediate steps to ensure the encashment of cheques, as the current situation is causing considerable difficulties for traders.
Over the past week, the prices of edible oil and sugar have surged by 80-100 Tk per maund in Khatunganj.
For example, sugar prices have risen from Tk 4,320-4,330 last week to Tk 4,400 Tk on Saturday (August 24). Similarly, palm oil prices have increased from Tk 4,960-4,980 to Tk 5,080-5,090. However, the prices of other products, including onions, ginger, and spices, have remained stable.
"The business environment in Khatunganj has drastically slowed down," said Solaiman Badsha, a trader at Khatunganj. "Traders from smaller towns are not coming to Khatunganj to buy goods, and only a small amount of daily essentials are being sold."
Saidul Haque, Director of Imam Sharif Brothers, echoed these concerns. "The market prices are fluctuating, especially for edible oil, due to supply issues from the S Alam mill. Other mills are taking advantage of this situation."
For the past one month, there was no business at Khatunganj and now the flood has slowed down sales. The crisis is exacerbated by the reluctance of major traders to accept cheques from banks associated with S Alam. This has further complicated the situation, leaving many traders in a precarious position.
A businessman, who wished to remain anonymous, highlighted the deep connection between S Alam Group and Khatunganj. "S Alam Group's influence in Khatunganj is significant, with ties to several banks, including Islami Bank. Although there are sufficient funds in accounts, checks from these banks are being rejected, causing a slowdown in business."
The absence of S Alam Group from the market has led to a loss of control over prices in Chattogram, particularly for essential goods like edible oil and sugar. "Even though S Alam was accused of financial misdeeds, they maintained a steady supply of goods in Chattogram. Now, other millers are exploiting the situation, driving up prices," said Shahjahan Bahadur, another Khatunganj businessman.
The crisis has also impacted small traders, with over a thousand facing losses due to the stagnation of trading activities. "The withdrawal of S Alam Group has left a void in the market, leading to increased prices and reduced business," said a business leader from Khatunganj, who also chose to remain anonymous.
Despite the intervention by Bangladesh Bank in some banks, S Alam Group still holds considerable influence over First Security Bank, Union Bank, Commerce Bank, and Global Islami Bank. Problems also persist with Padma Bank and National Bank checks, further complicating the situation for Khatunganj’s traders.
"Immediate action is needed to ensure the encashment of traders' checks," the business leader stressed. "If not, the business in Khatunganj will continue to shrink."
Attempts to reach Kamal Uddin, Zonal Head of First Security Islami Bank Limited Chattogram, and Jahurul Islam, Branch Manager of Union Bank Limited Khatunganj, for comments were unsuccessful as they did not respond to calls.