Agriculture Marketing Reforms in Bihar, India: A Paradigm Shift Needed Dr.K.M.Singh, Director, Bihar Agricultural Management & Extension Training Institute, Patna 6th June 2007 Presentation in Meeting of the Steering Group on Agriculture, State Planning Board, Soochana Bhawan, Patna, Bihar, India
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Agriculture Marketing Reforms in Bihar, India:
A Paradigm Shift Needed
Dr.K.M.Singh,
Director, Bihar Agricultural Management & Extension Training Institute, Patna
6th June 2007
Presentation in Meeting of the Steering Group on Agriculture,
State Planning Board, Soochana Bhawan, Patna, Bihar, India
Changing Scenario: Agriculture vis-à-vis Market
Effects of globalization and liberalization changing the face of the market
Changing consumer interest & preferencesDiversification of food basketIncreased demand for good quality, value
added and processed food productsCompetitive market conditions Raising and stabilizing consumer incomes Food security improving Improving sustainable farming systems
Need for a new Approach to Marketing
Shift from staples to high value cropsFrom narrow agricultural focus to broader
policy context – including global impactsFrom focus on crop yields to market demands
and incomesFrom primary production to entire food chainFrom agriculture to overall rural spaceFrom purely public to public-private
partnerships, including community driven development
DomesticDomestic International MarketInternational Market
Inadequate information with farmers to plan production– Little or no linkages with the market Research system with limited connect with the market Public actions focused on crisis resolution, not at systemic solution Private sector focus on articulating problem only a few initiatives to show for.
ConsumerConsumer
Ploughing ahead …..times have changed
Recent trends include: Specialized & localized production
Market - led Production
Diversification
Use of improved inputs
Uniform quality
Contract and Organic farming
Trends in Agricultural Marketing
Marketing of Agricultural Products
Driven by market forces / consumers/ retailGlobalized through international tradeInfluenced by new technologiesSubject to stricter regulatory scrutinySubject to greater ethical scrutiny
But peoples’ ability to respond to this changing context differs greatly between regions, nations and communities
New Initiatives in Bihar Agriculture
Repeal of APMC Act providesopportunities for:
Establishment of Market Yards in private sector.
Establishment of specialty market.
Contract farming
Value addition and Processing
New Initiatives in Bihar Agriculture
Other initiatives include: National Horticulture Mission for Fruits,
Macro Management for cereals ISOPOM for pulses, oilseeds & Maize Establishment of ATMA in all the districts to
bring all stakeholders on one platform and to promote PPP.
Rice, Wheat and MaizeSugarcaneFruits and vegetablesMakhanaLitchiHoneyDairy productsSelect spicesAromatic oils and Herbs
Bihar’s Strength in Agricultural Sector
Some success stories and opportunities to build in Bihar’s agriculture include:
Makhana processingOrganic riceLitchiExotic vegetables like snow peasLitchi HoneyTea in Eastern BiharAromatic oils- mentha & lemon grass
Constraints and challenges Low productivity, due to low level of technology; Poor infrastructure in the rural areas; Unstable production and generally with low quality standards
for export. Problems in the post-harvesting handling, storage, packaging
and high transaction costs. Lack of market information systems in the rural areas. Lack of previous experience in dealing with developed
markets and export procedures. Limited access to credit for farmers due to high interest rates
at commercial banks; and No attractive business for commercial banks due to high risk
in agriculture
Solution?Moving towards Action on Public-Private Partnerships in Agricultural Marketing
Key factors for partnerships
Each partner must bring something to the table
Common objective Value creation for both Complimentary roles
The way forward ……..
Stop depending too much on the government…
Stop thinking the private sector as greedy and unreasonable
Combine the efforts of the public, private sectors and community (civil society) together to get the best benefits
Opportunities for Partnership Exist
Partnerships can improve access to:New technologies, and toolsNew research expertise and infrastructurePrivate equity markets; donor fundingNew product markets and new customers New marketing and distribution networks
Synergies through knowledge sharing, Joint learning, Economies of Scale, Resource pooling, and Cost sharing
But there is a confusion on roles!
With changes in the global agri-food
system, the roles of the state, industry,
and society remain contested:Controversy over ownership of new knowledgeIssues over distribution of benefits and risksConcerns over lack of pro-poor emphasisUnease over environmental, social sustainability
Learning from other sectors e.g. the health and ICT sectors
Practical Options
Working together on “how to” Delivery mechanisms and marketing Management tools of research and
innovation Technology collaboration and related issues Collaboration which could impact rights on
knowledge in public domain
Government’s role: Policy environment Change in mindset
From Regulator to Facilitator Engage in Partnerships for Skills development &
complementation Legal Framework
Move to a single window dispensation in spirit & practice
New legislations be made facilitative rather than regulatory
Effective IP protection and enforcement across the board
Multiplicity between centre and states in regulation is discouraging
Partnerships are taking place Industry wants to focus on national goal of
increasing food production in a sustainable manner.
Enhanced private R & D investment is feasible under correct policy environment
An enabling environment is a must Several examples of partnership already exist
and can be built upon
Industry’s Perspective
Benefits of P-P-P to Private Sector
More competitive locally
Expand market for private sector
Allows exports in foreign markets
Benefits form public private consortia
Public sector strongerMore moneyResearch more relevant for industry and farmers
Private knowledge of marketPrivate germplasm and technology
Private sector benefits fromTechnology Access to knowledge
Concept of Corporate involvementThe Corporates should ensure forward and backward linkages with the farmers to co-ordinate and promote
production and marketing of agriculture produce
Farmer Corporate
Produce quantity and quality as per requirements of Corporate
Provide support in terms of extension services, agri-inputs, credits, farm practices, markets and fixed price
Quality seeds
Corporate involvement
Accessible market
Extension Services
Higher yields
Price support
Concept of Corporate involvement……The corporate extension agencies should ensure supply of quality seeds, extension services, better yields, market access and buy
back price support.
Typically contract farming will need corporate involvement to address...
Identificación of high yielding alternatives which give better returns than paddy-wheat rotation
Marketing security and technical assistance in a multi-crop programme
Removal of infrastructural bottle-necks and enabling regulatory framework