Malaysia - World Bank Documents

Report No 632a-MA

Malaysia F=ILECPAppraisal of the 1ELh C0pAgricultural Research and Extension ProjectApril 25, 1975

East Asia and Pacific Projects Department

Not for Public Use

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Document of the International Bank for Reconstruction and DevelopmentInternational Development Association

This report was prepared tor official use oniv by the Bank Group It may not

be published quoted or cited without Bank Group authorization The Bank Group does

not accept responsibilitv for the accuracy or completeness ot the report

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CURRENCY EQUIVALENTS

Currency Unit Malaysian Dollar (M$)

US$1 M$ 2.45 /aM$ 1 US$0.408M$ 1 million US$408.163

WEIGHTS AND MEASURES

1 acre (ac) = 0.405 hectares (ha)1 mile (mi) = 1.609 kilometer (km)1 sq. mile (sq mi) = 640 acres (ac)1 ton = 2240 lbs. (lb) = 1,000 kilograms (kg) (approx.)

ABBREVIATIONS

AVRDC = Asian Vegetable Research and Development CenterCIAT = Centro Internacional de Agricultura TropicalCIMMYT = Centro Internacional de Mejoramiento de Maiz y TrigoCSIRO = Commonwealth Scientific and Industrial Research

Organization (Australia)EPU = Economic Planning Unit (in Prime Minister's Department)FELDA = Federal Land Development AuthorityFAO = Food and Agriculture OrganizationFOA = Farmers' Organization AuthorityFTRDC = Food Technology Research and Development CentreGNP = Gross National ProductGOM = Government of MalaysiaICRISAT = International Crop Research Institute for the Semi-Arid

TropicsIDRC = International Development Research Center (Canada)INTSOY = International Soybean Program (University of Illinois)IITA = International Institute for Tropical AgricultureIRI = IRI Research Institute, Inc.IRRI = International Rice Research InstituteLID = Local Indian Dairy (Cattle)MADA = Muda Agricultural Development AuthorityMARDI = Malaysian Agricultural Research and Development InstituteMPIB = Malaysian Pineapple Industry BoardMRRDB = Malaysian Rubber Research and Development BoardNLDA = National Livestock Development Authority

/a From June 21, 1973, the Malaysian dollar has floated in relation tothe US dollar. The rate shown is the rate of mid-1974 and has been usedthroughout this report.

MALAYSIA

APPRAISAL OF THE AGRICULTURAL RESEARCH AND EXTENSION PROJECT

Table of Contents

Page No.

SUMMARY AND CONCLUSIONS ..* ............................ i-iii

I. INTRODUCTION .......................................... 1

II. BACKGROUND .. ......................... .... ......... 1

General ..... .. ............................. 1The Agricultural Sector ........................... 2Agricultural Education ........................... , 4Agricultural Research ............................ 4Agricultural Extension . .............. ........... . 6Project Generation ......... ..................... 7

III. PROJECT AREA AND RESEARCH STATIONS .................... 7

IV. THE PROJECT ........ ...... .. 8

A. General Description ........... ............. 8B. Detailed Features .... .. 10

MARDI Research and Development Programs 10Research Program for Rice .10Research Program for Field Crops .11Research Program for Pineapples .. 12Research Program for Cocoa/Coconut. 12Research Program for Livestock. 13Research Program for AgriculturalProducts Utilization 14

Research Program for AgriculturalEngineering and Water Management . 15

Project Development Unit 16Central Services in MARDI 16Extension-Liaison Unit in theDepartment of Agriculture .17

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Page No.

V. ORGANIZATION AND MANAGEMENT . .......................... 18

A. Organization (MARDI) ....... ...................... 18

Management Structure ....... .................. 18Commodity Research Groups -Backstopping Research Groups ...... ........ 19

Research Service Groups .................... . 19Research Administration ..... . ................ 20

B. Staffing (MARDI) ... ............................... 20

Local Staff .......... ............................. 20Staff Salaries ...... ............................ 21Expatriate Staff ............................ 21

C. Organization (Extension-Liaison Unit) ............ 21D. Staffing (Extension-Liaison Unit) ................ 22E. Project Monitoring ....... ........................ 22F. Cooperation with International

Research Institutes ... ................... ........ 23G. Financing, Accounting and Audit .............. . 23

VI. PROJECT COSTS, FINANCING, DISBURSEMENTSAND PROCUREMET ......... ............................ 23

Project Costs ....... ........................ 23Financing ............................... ... 25Disbursements ................... .. 25Procurement ................... ... 26

VII. JUSTIFICATION AND BENEFITS ........ ..................... 27

VIII. AGREEMENTS AND RECOMMENDATIONS ........................ 28

Agreements .................................. 28Conditions of Credit Effectiveness .......... 29Conditions for Disbursement .. ............... 30

ANNEXES

1. Agricultural Education, Research and Extension Services(2 charts, 2 Appendices and 1 map)

2. MARDI - Research Program for Rice3. MARDI - Research Program for Field Crops4. MARDI - Research Program for Pineapples5. MARDI - Research Program for Cocoa/Coconut

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6. MARDI - Research Program for Livestock7. MARDI - Research Program for Agricultural Products Utilization8. MARDI - Research Program for Agricultural Engineering and

Water Management (1 chart)9. MARDI - Project Development Unit10. MARDI - Central Services11. Department of Agriculture: Extension-Liaison Unit (1 chart)12. Project Costs and Financing13. Project Disbursement and Procurement14. Justification and Benefits (1 chart)

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

SUMMARY AND CONCLUSION

i. The Project reinforces the Malaysian Government's program tostrengthen agricultural research for which purpose the Malaysian AgriculturalResearch and Development Institute (MARDI) was created in 1969. Research onone crop, rubber, has been carried out with outstandingly good results forover 40 years by the Rubber Research Institute of Malaysia (RRIM). Awarenessof the importance of organized research for agricultural development is there-fore strong in Malaysia, and the need for consolidating of hitherto fragmentedresearch for the production, processing and utilization of all crops (otherthan rubber for which RRIM would remain responsible), livestock and fresh-water fish has been clearly identified. Beginning in 1971, MARDI took overall existing research in rice, oil palm, coconuts, horticultural and fieldcrops as well as in crop protection, and more recently pineapple researchand food technology from the various institutions previously responsiblefor this research. Research planning is being guided by Government policiesto assist small farmers to improve productivity and to raise their incomes,and to diversify agricultural production both for export and to reduce im-ports.

ii. The Project would support MARDI in developing and conductingspecific commodity oriented research programs by providing the servicesof internationally recruited scientists and specialists, staff fellowshipsfor specialist post-graduate training, laboratory, field and workshop equip-ment and supplies, buildings and the importation of improved breeds of var-ious classes of livestock. The specific research programs are for rice,field crops (grain legumes, maize, sorghum and cassava), pineapples, cocoa/coconut and livestock. The Project will also include research on agriculturalproduct utilization, and the establishment of (i) an Agricultural Engineeringand Water Management Unit, which would carry out research in agricultural en-gineering and water management and provide research supporting services toall commodity programs, (ii) the strengthening of a Project Development Unit,which would undertake field verification and regional evaluation of commodityresearch programs, disseminate information and assure liaison between researchwork and agricultural extension services, and (iii) the provision of centralanalytical, computer, library and workshop services. Finally, the Projectwould provide for the establishment of an Extension-Liaison Unit (ELU) in theFederal Department of Agriculture to promote and to facilitate the efficienttransfer of MARDI research results to the State Departments of Agriculturewhich are responsible for the extension services at the farm level. TheProject would assist the establishment of this Unit by providing financialsupport for expatriate extension specialists, staff fellowships, a buildingprogram and the purchase of equipment. It is expected that the Project wouldbe followed by an extension project to be prepared possibly for Bank financingby the Extension-Liaison Unit.

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iii. Total costs of the Project are estimated at US$108.5 million(M$ 265.8 million), including US$35.8 million of price and physical contin-gencies. These total costs will provide essential buildings, equipment andmaterials, and will cover the cost of operating the program for the 1975-1981period, including the services of internationally engaged and local personnel;of the total, US$30.1 million represents local staff costs. The Loan wouldfinance the foreign exchange component of US$28.5 million, equivalent toabout 26% of Project cost. The remaining cost would be covered by Govern-ment appropriations. Contracts for buildings and goods, other than forlivestock, would be awarded on the basis of competitive bidding advertisedlocally and in accordance with local procedure satisfactory to the Bank. Norestrictions would be placed on bidding by foreign contractors. Livestockpurchases would be made in countries selected by the Director of MARDI withthe concurrence of the Bank but in all other respects the normal Bank pro-cedure on procurement would be followed for livestock also. Expatriatespecialists and research fellows would be selected by the Director of MARDIand the Director of the Extension-Liaison Unit respectively. Appropriatearrangements would be made for the recruitment of specialists and for man-agement of the fellowship program. Appropriate linkages would be soughtand strengthened with International Agriculture Research Institutes. Spe-cial arrangements would also be made for both internal and external tech-nical program reviews on an agreed interval and basis.

iv. This would be the tenth agricultural and forestry project financedby the Bank in Malaysia. Previous loans include 3 loans for the Jengka Tri-angle Projects (Loans 533-MA, US$14.0 million; 672-MA, US$13.0 million; and885-MA, US$25.0 million) approved in 1968, 1970, 1973 respectively; one loanfor the Johore Tenggara Land Settlement Project (Loan 967-MA, US$40.0 mil-lion approved in 1974), one loan for the Keratong Land Settlement project(Loan 1044-MA, US$36.0 million). The other loans are for a forestry proj-ect (Loan 673-MA, US$8.5 million, 1970), for two irrigation projects - MUDA(Loan 434-MA, US$45.0 million, 1965) and Kemubu (Loan 500-MA, US$10.0 mil-lion, 1967) and for the Western Johore Agricultural Development Project(Loan 973-MA, US$45.0 million, 1973). Implementation of all these proj-ects is progressing satisfactorily.

v. The decision of the Malaysian Government to spend about US$108million for an agricultural research project appears fully justified in viewof the benefits which can reasonably be expected as indicated by the evidenceon the relationship between aggregate net agricultural output per hectareand the research-extension effort in a selected group of 12 Asian countriesor in rubber production in Malaysia and other such suppprting evidence. Di-versification of agricultural production, increase of exports, in order toimprove Malaysia's foreign exchange earnings and self-sufficiency forrice and animal feed crops, has become more important recently in viewof uncertain supply conditions. To achieve this requires an organizedand systematic agricultural research effort as well as a strengthening ofextension services. Of overriding importance is the support the Projectwould give to Malaysia's small farmers (who do not have the means to finance

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or to organize their own research), who would be able to introduce newtechnology and thus to improve their incomes aided by results of the expandedlevel of research activity made possible by the Project.

vi. Given the agreements and recommendations in paras. 8.01, 8.02 and8.03, the Project is suitable for a Bank loan of US$28.5 million to be madeto the Government for a term of 25 years including 7 years of grace for therepayment of the principal. The Loan would be disbursed from 1975-1982 andwould be passed on to MARDI and to the Department of Agriculture as a grant.

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

I. INTRODUCTION

1.01 The Government of Malaysia (GOM) has asked the Bank to assist infinancing the further development of the Malaysian Agricultural ResearchInstitute (MARDI) over the six-year period 1975-1980. The Project wouldprovide MARDI with a group of experienced overseas scientists to aid inplanning and developing its research programs, additional equipment andfacilities for research, and fellowships for overseas postgraduate trainingof MARDI staff. It would also support the formation of an Extension-LiaisonUnit in the Department of Agriculture. This would be the tenth Bank Loan,insupport of agricultural development in Malaysia.

1.02 The Project was prepared for GOM by the IRI Research Institute,Inc. of New York (IRI). This report is based on the findings of Messrs.Milford, Lesueur and Downing (Bank) and Eyles (Consultant) who visitedMalaysia in July 1974 to appraise the Project.

II. BACKGROUND

General

2.01 Malaysia covers about 128,000 square miles. Less than one-fourthof Peninsular Malaysia and only about 3% of Sarawak and Sabah are undercultivation and tropical rain forest covers most of the remaining area. Theclimate is characterized by uniformly warm to hot temperatures and abundantrainfall.

2.02 Population in 1972 was estimated at 11.4 million, growing at 2.7%a year. About 85% of the people live in Peninsular Malaysia with the high-est densities on the coastal strip and foothills of the west coast and inthe south. Malays account for about 53%, Chinese 35%, Indians 11% and others1% of the population.

2.03 The economy is export-oriented. In 1973, exports accounted foralmost 50% of Gross National Product (GNP), principally rubber (US$1,045million), tin (US$366 million), timber (US$630 million) and palm oil(US$190 million). Real GNP at market prices grew at an average yearlyrate of 6% during the last decade and amounted to about US$6.8 billion in1972. Average real GNP per capita, which grew at about 3.0% yearly duringthe 1960's, was about US$477 in Malaysia as a whole in 1973, but much lessin the rural areas. During the 1960's, consumer prices rose by about 1%yearly on the average. During 1972-73, prices began to rise in 1972 (by3%) and during 1973 jumped to 10% as the result of sharp increases in importprices and a domestic rise in national income. Price increases were stillrising at an estimated rate of 18% in 1974.

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2.04 Wide disparities in income and ownership of assets are correlatedwith ethnic differences. Malays have lower incomes than non-Malays. Muchof this income imbalance arises because nearly 80% of Malay employment isin the rural sector compared with slightly more than 50% for the non-Malay.But even within the rural sector, Malay incomes are generally much lowerthan for non-Malays. More than half of the total Malay labor force isengaged in traditional, low income, smallholder agriculture compared to14% of the non-Malay labor force. In the rubber smallholder sector, Malaysoutnumber non-Malays by 2 to 1. The average size of non-Malay holdings of8.3 acres is almost twice that of Malay holdings. The dissatisfaction withthe distribution of benefits of economic growth and with growing ethnicincome inequalities provides the rationale for Government's New EconomicPolicy. The major aims of this policy, as expressed in the Second Malay-sian Plan 1971-75, are: (a) to reduce poverty by raising income levelsand increasing employment opportunities for all Malaysians, irrespectiveof race; and (b) to accelerate the process of restructuring Malaysiansociety to correct economic imbalances so as to reduce, and eventuallyeliminate, the identification of race with economic function. One of theresults of the policy is the increasing attention given to raising ruralincomes, especially those of smallholders, through land settlement andrural development schemes (para 2.10).

2.05 It is precisely this focus of the New Economic Policy which gavebirth to MARDI in the recent past, since it would develop the new technologyon which increased rural incomes would rest.

The Agricultural Sector

2.06 The agricultural sector holds a pre-eminent position in theMalaysian economy. In 1974 it generated around 30% of Gross DomesticProduct, provided employment for about 50% of the economically activepopulation and accounted for upwards of 60% of Malaysia's foreign exchangeearnings. Expansion of rubber exports in the 1960's, in the face of de-clining prices, was achieved by large gains in productivity. At the sametime, diversification to oil palm was vigorously encouraged and now accountsfor 10% of the country's export earnings; Malaysia has become the world'slargest producer of palm oil. Rice production has been increased throughthe provision of irrigation, HYV and double cropping, and Malaysia is nownearing self-sufficiency in rice. Malaysia is one of the world's major pro-ducers of pineapples, however, it is finding it increasingly difficult tomaintain its share of the export market. Other major crops, such as coco-nut, coffee, cocoa, fruits and vegetables, are grown mainily in peninsularMalaysia for internal consumption.

2.07 Of the 7 million cultivated acres 1/ in Peninsular Malaysia in1972, rubber occupied 4,460,000 acres, oil palm 720,000 acres, coconut528,000 acres; more than 5.7 million acres was under tree crops. Of the

1/ With double cropping and inter-cropping, annually about 8.5 millionacres would be cropped.

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remaining 1,300,000 acres, 937,000 was under paddy (about half of it doublecropped). Other significant crop acreages are pineapple 55,000, cocoa39,000, tapioca 29,000, sugar 25,000, tobacco 22,000, coffee 22,000, andgroundnuts 19,000 (1972).

2.08 Pork and poultry are the two main livestock products in Malaysia.In 1973, the annual per capita consumption of pork was 15.6 and of poultrymeat 6 kg. Both industries are heavily dependent upon imported feed grainscosting about M$ 200 million in 1973. The outlook for feed grain importsindicates that future supplies will be more expensive and increasingly dif-ficult to obtain on a reliable and regular basis. Thus GOM has adopted apolicy aimed at increasing home production of animal feedstuffs. Similarlyit is encouraging expansion of local beef, mutton and milk production to bebased on better use of crop residues and the growing of improved pasturesand forage crops.

2.09 Large estates account for about half the production of rubber and40% of the production of oil palm, but the smallholder proportion is in-creasing especially in oil palm where Government policy strongly favoursbuilding up the smallholder sector. There are also some large coconutestates and two or three large pineapple estates. Other than these exportcrops Malaysian agriculture is almost entirely concerned with the productionof food, for domestic consumption, by small farmers.

2.10 The agricultural population includes some of the most economicallyand socially depressed sectors of the Malaysian community. Government'smajor agricultural policy thrust has been to develop new land for settle-ment of landless laborers and marginal farmers mainly into smallholderrubber and oil palm. Related programs have been mainly carried out by theFederal Land Development Authority (FELDA) and Bank finance has assistedseveral such smallholder projects, namely: Jengka I (Loan 533-MA); JengkaII (Loan 672-MA); Jengka III (Loan 855-MA)l Johore Tenggara (Loan 967-MA),Johore Agricultural Development (85-MA), and Keratong (Loan 1044-MA), ap-proved in September 1974. Other land settlement programs for smallholdersare being undertaken by the Rubber Industry Smallholders DevelopmentAuthority (RISDA). Such settlement programs, however, can only deal witha relatively small number of people, and cannot by themselves alleviaterural poverty throughout Malaysia. The Government has therefore tackledtwo other major sectoral activies:

(a) Paddy Farming: Irrigation systems have been con-structed for a number of major smallholder paadyproducing areas. One of these was the Muda IrrigationProject (Loan 434-MA), which has been successful inintroducing double-cropping and improving yields.Another major paddy project is the Kemubu IrrigationProject (Loan 500-MA).

(b) Smallholder Development: Remaining needs are forphysical infrastructure, technology and agriculturalsupporting services to improve incomes on existingsmallholdings. This Agricultural Research andExtension Project aims at complementing thephysical infrastructure with the appropriatetechnology. The FAO/IBRD Cooperative Programmounted a mission in October 1974 to review thestructure and needs of the smallholder subsector.The report of this mission is expected to be com-pleted shortly.

Agricultural Education

2.11 Malaysia's developing University system is well geared to supplysufficient bachelor's degree graduates to meet the agricultural sector'sexpanding needs. About 300 bachelor's degrees in agriculture, 500 inrelated sciences and 400 in economics/administration/management are beingawarded annually. However, facilities for postgraduate training to M.Sc.and Ph.D. levels are limited and for a considerable time, most post grad-uate training of Malaysian students will continue to be done at overseasuniversities. This will particularly effect those who wish to take upagricultural research for whom the general agricultural bachelor's degreetraining is not adequate. Facilities for training agricultural techniciansto diploma and certificate levels are already-well established in Malaysiaand are being expanded. They are adequate to meet the needs of researchand other agencies (Annex 1).

Agricultural Research

2.12 There is a local awareness of the economic value of well organizedmnd executed indigenous research through the outstanding work of the longestablished Rubber Research Institute of Malaysia (RRIM). Until the late1960's other agricultural research was carried out mainly by the Agriculturaland Veterinary Departments and to a lesser degree by the Malaysian PineappleIndustry Board (MPIB) and by FELDA.

2.13 A study in 1968 highlighted important deficiencies in the researchcapacities of these organizations and GOM concluded that all agriculturalresearch, except rubber, should be consolidated into a single institute(Annex 1, para 12). In 1969 legislation was passed creating the MalaysianAgricultural Research and Development Institute (MARDI).

2.14 The MARDI Act (Annex 1, Appendix 1) gives the Institute responsi-bility for scientific, technical, economic and sociological research inMalaysia with respect to production, utilization and processing of allcrops (except rubber), livestock and freshwater fish. MARDI also has thefunction of providing an agricultural information service, and maintainingliaison with other agricultural research organizations.

2.15 MARDI commenced to operate as an effective Institute in early 1971when it took over existing research programs in rice, oil palm, coconuts,horticultural and field crops and crop protection from the Department ofAgriculture, together with a number of its research stations. Of these,only the rice program was supported by facilities and trained staff at alevel adequate for productive research. Pineapple research was not trans-ferred from MPIB until January 1974 and food technology research, hithertocarried out by the Food Technology Research and Development Centre (FTRDC),was transferred to Mardi on October 1, 1974 (see 5.08).

2.16 The main tasks of MARDI to date have been to (i) plan and initiateits research programs, (ii) develop an appropriate research organization,(iii) develop research facilities, and (iv) recruit and train staff. Researchplanning has been undertaken within the framework of the Government's policyof (i) raising the prosperity of the small farmers, (ii) improving produc-tivity of export crops, (iii) diversifying agricultural production, and (iV)import substitution. Special Government support has been provided for oilpalm research because of the size and rapid growth of the industry. Riceresearch has been further developed and new programs have been initiated intree, field and horticultural crops, and livestock, within the constraintsset by availability of trained staff and facilities. Many of the researchprograms taken over and continued by MARDI are oriented to solving produc-tion problems of important commodities such as rice, oil palm and pineappleand significant breakthroughs have been achieved in tissue culture and plantprotection research which is of major importance to these commodity researchprograms. Useful results are now accruing from such programs. As a conse-quence MARDI has commenced an outreach program of project development workinvolving the regional verification of research results and dissemination ofinformation to extension agencies.

2.17 MARDI has had some problems in developing a suitable organizationalstructure. It is recognized in Malaysia that a re-structuring of MARDI wasnecessary to overcome the difficulties which experience to date has revealed.The main improvements needed were: a strengthening of the Directorate, placingresearch, development and administration in their proper perspective, and pro-viding an effective structure for commodity oriented and supporting research.This has now been achieved (para 5.02).

2.18 Since its inception, MARDI has undertaken a program to provideadequate facilities, mainly buildings, laboratory and field equipment atits new headquarters at Serdang, the centers at Kluang, Bukit Ridal andBertam as well as expanding and upgrading those at eleven field stationsformerly controlled by the Department of Agriculture.

2.19 In the past, MARDI's greatest problem has been a shortage of ex-perienced scientific staff and the difficulty of recruiting and retainingsuch staff in the face of competition from RRIM and the Universities bothof whom offered higher salaries and better fringe benefits. However, theproblem of salary inequities has been basically overcome by the implementa-tion of the Harum Salary Commission Scales in January, 1975. During nego-tiations, assurances were given that MARDI salaries would be adjusted and

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maintained at a level equitable with RRIM and the Universities. In spiteof past salary deficiencies, MARDI has managed to establish a nucleus ofhigh calibre scientists, particularly an excellent young cadre, sufficientto initiate and implement the accelerated development envisaged under theProject.

2.20 In July 1974 the total MARDI staff was 891, including 126 in thevarious research officer classifications and 327 research assistants, notincluding the Agricultural Products Utilization Unit (formerly FTRDC).All staff in the research officer grades hold at least a bachelors orbachelors with honours degree, some 45 hold MSc. degrees while about 10have PhDs. Many research assistants also have bachelors degree or arestudying part time for their degree. In addition MARDI has an active pro-gram for full time degree training for the most promising research assistantswith diploma qualifications. MARDI has a policy of promotion of good grad-uate research assistants to the research officer grades. Also MARDI fullyappreciates the necessity of advanced training for its research staff andcurrently has about 80 personnel away attending MSc or PhD. courses; morethan 60 at overseas universities. No problems are anticipated in expandingthe research office staff working in the 8 MARDI programs to be financedunder the proposed Project from about 127 at the end of 1975 to about 230by the end of 1980.

Agricultural Extension (Annex 1)

2.21 The States' Agriculture and Veterinary Departments are responsiblefor extension on crops and livestock to the predominantly smallholder sector.The States are supported by the Federal Agriculture and Veterinary Depart-ments who supply funds, key personnel, supervision and technical support.Other agencies involved in extension to specific sub-sectors are RRIM(Estate Rubber), RISDA (smallholder rubber), MPIB (pineapples) and FELDA onits land settlement schemes. The newly created Farmers Organization Author-ity (FOA) is augmenting Departmental extension services to provide integratedrural development services through its farmers' Development Centres.

2.22 The States have a total of only 45 graduate extension officersserving the 450,000 small farms of Peninsular Malaysia. The field exten-sionist are trained to junior school certificate level and receive someadditional in-service training. In the more prosperous States there isone field extensionist to 500 farm families, but in the less prosperous,the ratio is one to several thousand. In general, both the Federal andState departmental services are understaffed. Through the establishmentof an Extension Liaison Unit in the Federal Department of Agriculture, theProject will strengthen the Extension Service at the Federal Level. Itwas also agreed at negotiations that GOM would make arrangements to expandand strengthen agricultural extension at the State level to facilitate thetransfer of research findings and requirements to and from the farmers.

2.23 If MARDI is to fulfill its role effectively as the developer ofnew technology for the Malaysian farmer, it is vital that the country'sextension services be strengthened. Indeed more effective extension isurgently needed to promote existing proven technology. Although furtherstudy is needed to determine how this can be achieved most effectively,initial strengthening of the federal service is clearly necessary. Inthis context priority is to be given to development of an Extension-LiaisonUnit in the Federal Department of Agriculture to: (i) act as a bridgebetween MARDI and the field extension services, (ii) train field extensionworkers, and (iii) feed back field problems to focus MARDI's work on theneeds of Malaysian agriculture.

Project Generation

2.24 In December 1972, GOM requested the Bank to assist it in financingspecific research projects and programs and in the provision of facilitiesand equipment as part of its overall five-year program of development forthe infant MARDI organization. Following a reconnaissance mission inFebruary 1973 which recommended the Bank's participation in this program,GOM engaged IRI to assist it in preparing a project for Bank financing.

2.25 During its stay in the country, the appraisal mission becameacutely aware of the gap between existing research findings and known tech-nology on the one hand, and farmer adoption of this technology on the other.An Extension-Liaison Unit within the Department of Agriculture, was thereforeincluded in the Project to initiate improvements in the extension services(paras 4.51 - 4.54).

III. PROJECT AREA AND RESEARCH STATIONS

3.01 The staff and facilities of the project would be located at someof the 22 research centers and field stations shown in Annex 1, Appendix 2.The principal activities would be at those stations dealing with the fourcommodity programs, (i) rice at Bumbong Lima, (ii) field crops at BertamEstate, (iii) pineapples at Jalan Kebun, (iv) livestock at Serdang. Otherprograms i.e., agricultural products utilization, agricultural engineeringand water management, project development unit, and supporting serviceswould be at MARDI Headquarters at Serdang. The Department of Agriculture'sExtension-Liaison Unit would be located at Kuala Lumpur.

3.02 Evaluation and verification trials would be carried out throughoutPeninsular Malaysia, and after 1977 also in Sabah and Sarawak. Researchwork in the States of Sabah and Sarawak would be undertaken upon their re-quest, since a formal agreement between the Federal and State authoritiesto undertake agricultural research by MARDI in these States has not yetbeen concluded.

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IV. THE PROJECT

A. General Description

4.01 The essence of the Project is to assist Malaysia to build aninstitution with an agricultural research capability commensurate with thetechnological needs of Malaysia's agricultural development aims. It wouldfocus on accelerating smallholder development. This the Project would dothrough advanced training of staff and complementing the expanded staffcapability with equipment and facilities. Since most agricultural-researchis of a long term nature, a significant increase in the flow of usable re-search should not be expected during this institution building period.

4.02 The Project would assist GOM in accelerating its program of pro-duction oriented-research by providing MARDI with facilities and equipmentfor advanced training of its staff and, while this crash training programis underway, by financing the participation of senior, experienced, inter-nationally recruited scientists in MARDI's research programs. It wouldalso build linkages with International Agriculture Research Institutes;existing linkages would be strengthened and new ones would be sought. TheProject would also finance the creation of a new Extension-Liaison Unit inthe Federal Department of Agriculture as a first step in providing the meansfor accelerating any existing research information to the smallholder sector.

4.03 The Project would assist in strengthening and expanding existingresearch programs for rice, field crops (grain legumes, cassava, maize andsorghum), cocoa/coconut, livestock and pineapples, and agricultural productutilization. Also it would provide for the establishment of an agriculturalengineering and water management unit to participate in the crop researchprograms and to study problems of small farm mechanization and water controlin the rice areas. These programs were selected on the basis of their sig-nificance or potential significance to Malaysian agriculture, particularlythe predominantly small holder sector. Oil Palm although an important small-holder crop, was not included because adequate provision for financing oilpalm research had already been made through a special Treasury grant. MARDI'sProject Development Unit would also be expanded under the Project to giveincreased emphasis to programs for evaluating the research findings of thecommodity groups under field conditions. It would also stimulate and measurethe rate of farmer adoption of new technology and, at appropriate intervals,the overall benefit of the project. This work would be carried out in closecooperation with the State Departments of Agriculture.

4.04 The Project would support the following components:

(a) Internationally recruited senior scientists to work inthe various programs, consisting of: (i) 67 man-yearsof research scientists, including a Program Specialist

who would work with the Deputy Director for ResearchPrograms, for the five commodity programs (rice,field crops, cocoa/coconut, livestock and pine-apples); (ii) 15 man-years of food technologistsfor the product utilization program; (iii) 15 man-years of engineering scientists for the agriculturalengineering/water management program; (iv) 7 man-years of specialist services (information dissemina-tion, rural sociologist) for the Project DevelopmentUnit; and (v) 9 man-years of extension specialists forthe Department of Agriculture's Extension-Liaison Unit.

(b) 380 man-years of fellowships for post-graduate trainingof MARDI and Department of Agriculture Staff.

(c) Essential equipment consisting of laboratory equipment,chemicals and glassware, farm-field and workshop equip-ment for all MARDI programs and appropriate extensionequipment for the Extension-Liaison Unit.

(d) Importation of improved breeds of dairy and beefcattle, buffaloes, pigs and poultry.

(e) Laboratories, workshops, livestock housing, storageand office facilities for MARDI and office, hosteland other regional buildings for the Extension-LiaisonUnit.

(f) Periodic annual internal technical program reviews byMARDI Scientists and external reviews by eminentscientists of the various research programs, atappropriate and useful intervals.

(g) Evaluate, at appropriate intervals, the overall impactof the Project and establish a monitoring systems forthis purpose.

(h) Provide the services of a Programming Specialist towork with the Deputy Director for Research Programsto assist MARDI in the development, coordination andimplementation of its research in accordance with theNational Plan.

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B. Detailed Features

MARDI Research and Development Programs

4.05 The Project would finance a number of integrated commodity researchprograms in MARDI supported by Agricultural Engineering-Water Management re-search, a Project Development Unit, a central analytical laboratory and cen-tral library, computer and workshop facilities.

4.06 The success of MARDI's research during the critical first yearsof the project depends upon its abilitY to plan, coordinate and integrateits expanded and accelerated programs. Therefore, the Project has pro-vided, and it was agreed at negotiations, that an internationally recruitedProgram Specialist would assist the Deputy Director for Research Programsin planning, coordinations and implementation of the research programs.The Program Specialist would be financed out of unspecified funds from eachof the commodity programs.

Research Program for Rice (Annex 2)

4.07 This Program (total base cost US$2.0 million) would support andexpand MARDI's existing high quality rice research. In this, the Programwould serve two national objectives: self-sufficiency in rice and improvingproductivity of the small rice farmers.

4.08 The Program would be centered at the existing Bumbong Lima Stationwhere additional facilities would be provided. It would be carried out inspecific agro-ecological regions at four strategically located sites: AlorStar, Parit, Tanjong Karang, and Lundang-Kota Bharu. The existing collabora-tive research with IRRI would be continued and strengthened.

4.09 Research would focus on the selection and breeding of high yield-ing varieties and crop husbandry improvement. Particular attention wouldbe given to improving the efficiency of fertilizer use. The Program wouldbe multidisciplinary in approach, involving plant nutrition, insect anddisease resistance, and control, rodent control, agronomic studies such asplanting densities, depth of planting, plant-soil-water interactions, watermanagement, harvesting, storage and grain quality.

4.10 A collaborative research program between the'rice research groupand the field crops group would be developed to study mixed cropping systems.Collaborative studies would also be carried out with the agricultural en-gineering and water management research team and with the Project Develop-ment Unit.

4.11 Program research staff would be increased from 20 to about 35 by1980. Corresponding increases in supporting staff would also be made. TheProject would provide 14 man-years of internationally recruited scientists asfollows: plant breeder/agronomist (5 man-years); agronomist/plant nutrition

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(3 man-years); cropping systems (3 man-years) and short-term consultants(3 man-years). These scientists would work on specific projects within theteam, providing vital leadership to the enthusiastic young local scientistsduring the early phase of the program. They would also ensure continuity ofthe Program when many of the local staff would be receiving overseas post-graduate training.

4.12 The Project would provide 43 man-years of fellowships for thetraining of about 9 PhD's and 8 MSc's. Students would be selected on thebasis of their qualifications and the needs of the Program.

4.13 The Project would provide for insectaries, plant houses, addi-tional laboratory space and laboratory and field equipment for the programheadquarters and regional stations in addition to fertilizer and researchequipment for field and laboratory research.

Research Program for Field Crops (Annex 3)

4.14 This Program (total base cost US$3.1 million) would include re-search on food and feed grain, upland crops, concentrating on groundnuts,soybeans and other legumes, cassava and grams including maize and sorghum.Grouhdnuts and cassava are the two main annual field crops grown in Malaysiaand are important food sources. Soyabean, maize and sorghum although ofminor importance in agriculture production at present, are among the mainimported food and feed commodities. Maize and sorghum are essential to therapidly expanding pig and poultry industries.

4.15 Program headquarters would be relocated at the newly acquired Bertamestate, adjacent to the Bumbong Lima rice research station. Research wouldalso be undertaken at four field research stations, representative of themain agro-ecological cropping areas. The program would be of particularimportance to the smallholder sector.

4.16 The Program would concentrate on the development of crop varietiesand production techniques capable of high and sustained yields under fieldconditions. Promising introductions or varietal selections would be multi-plied and tested in coordinated trials at the headquarters and field sta-tions. They would be evaluated for yield, nutrient response, maturity,adaptability to cropping systems, and resistance to diseases, insects, mam-malian pests (particularly rodents), and environmental hazards. Particularattention would also be given to studies on nitrogen fixation by leguminouscrops. As the use of several of these crops in the Malaysian environmentis exploratory, a major effort in plant breeding would not be justifieduntil a representative range of introductions had been properly evaluatedand plant breeding objectives could be defined. This is particularly trueof maize, sorghum and of grain legumes such as cowpeas, mung beans andpigeon peas. In this work the linkage with the relevant InternationalInstitutes would be strengthened (CIMMYT, CIAT, ICRISAT, IITA and IDRC).

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4.17 The MARDI research staff in the Program would increase from 11 to38 between now and 1980. Senior scientists would be recruited international-ly to work in the Program during the early years of expansion under theProject. They would include plant scientist (5 man-years); maize sorghumagronomist (4 man-years); rhizobium specialist (4 man-years) and short-termconsultancies (9 man-years), a total of 22 man-years. 54 man-years of fel-lowships financed under the Project would provide for overseas post-graduatetraining to about 11 PhD and 11 MSc degrees.

4.18 The Project would provide support for the development of buildingsand farm facilities, and the supply of farm equipment, fertilizers, vehiclesand research equipment.

Research Program for Pineapples (Annex 4)

4.19 The objective of this Program (total base cost US$1.6 million)would be to increase productivity, profitability and efficiency of thisimportant export industry in which smallholders produce more than 50% oftotal annual output. The Project would expand the present research effortsat Jalan Kebun and Alor Bukit centers, both located on peat soils wherepineapple is the main crop.

4.20 This Program would involve breeding and selection for yield ofhigh quality fruit with a high canning yield. Close attention would alsobe given to disease resistance, plant nutrition and plant water relations,replanting strategies and crop physiology. Collaborative research would becarried out with the Agricultural Engineering-Water Management Unit and somestudies will be made on establishment of pineapple on non peat mineral soils.

4.21 The present research team would be increased from 9 to 18 graduatestaff by 1980. The Project would provide support for 10 man-years of inter-nationally recruiting senior scientists to provide leadership that willassist the efficient expansion of the program envisaged under the Project:pineapple agronomist (3 man-years), pineapple plant physiologist (3 man-years); and short-term consultancies (4 man-years). The Project would alsoprovide for 26 man-years of fellowships, leading to about 6 PhD and 3 MScdegrees in addition to about 3 man-years for short-term study tours by localstaff at overseas institutes.

4.22 Additional facilities at Jalan Kebun and Alor Bukit such as planthouses, a field laboratory, farm and workshop equipment, field and laboratoryresearch equipment and vehicles, would be provided under the Project.

Research Program for Cocoa/Coconut (Annex 5)

4.23 The objectives of the research program (total base cost US$3.0million) would be to develop the large potential for increasing yields ofcocoa and coconut and the area under production. The program would becentered at Hilir Perak (Telokanson) and Serdang on the west coast withsupporting activities at Jerengau on the east coast of the peninsula; theprogram would also be extended to Sabah and Sarawak.

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4.24 Research would be concerned with selection and breeding of improvedand hybrid varieties, pest and disease control, cultural practices, storage,drying, processing and handling. Continuation and expansion of the selectionof coconut clones for evaluation and use as parents in hybrid progeny trialswould be an important part of the program. Vegetative propagation researchfor cocoa shows promising results and will be strengthened and continued.The program will work closely with the Agricultural Engineering and ProductsUtilization Units.

4.25 The present research staff would be increased from 13 to 22 by1980; with proportional increases in supporting staff. The project wouldprovide for ten man years of internationally recruited scientist (PlantBreeder, 2 man-years, Pathologist, 2 man-years, Biochemist, 2 man-yearsand short-term consultancies, 4 man-years) to strengthen the leadershipand research activities of the progrnam before and during the period thatlocal staff are obtaining experience and training. The project wouldprovide 32 man-years of fellowships for overseas postgraduate degreetraining and study tours.

4.26 Additional facilities, buildings, land development, field equipment,planting materials, laboratory equipment, and agricultural chemicals would beprovided by the project. The Project would also provide for the collectionof germplasm materials in selected regions overseas in order to broaden theplant breeding base for cocoa and coconut.

Research Program for Livestock (Annex 6)

4.27 The Program (total base cost US$4.6 million) derives from GOM'spolicy of increasing output of local animal products at lowest possiblecosts. Program units would concentrate on beef and dairy cattle, buffaloes,sheep and goats (mainly for meat), pigs and poultry. Program headquarterswould be at the main MARDI Serdang complex, with field facilities fot cattleresearch at Kluang and for buffalo at Bukit Ridan.

4.28 Research in all units would include evaluation of local and importedbreeds in the Malaysian environment. Local cattle and buffalo, and theircrosses with improved exotic breeds, would be compared for meat and/or milkproduction efficiency, herd utilization and reproductive capacity. Breedcomparisons and cross-breeding studies would also be carried out with pigs,and, to a lesser extent, with poultry. Feeding trials to maximize the useof locally grown feedstuffs and locally available by-products by all classesof animals would be an important feature. Collaborative studies with theProject Development Unit would concentrate on developing management andfeeding systems suitable for smallholder mixed-farming operations.

4.29 The Project would prcvide 11 man-years of internationally re-cruited scientists: beef/production specialist (4 man-years), pig produc-tion specialist (3 man-years), poultry specialist (2 man-years) and short-term consultancies (2 man-years). The Project would finance 36 man-years

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of fellowships for Program staff, leading to about 6 PhD and 6 MSc degreein addition to 6 man-years of short-term study tours. The Project wouldfinance the importation of livestock, feedstuffs, fertilizer and construc-tion of buildings, including housing for the animals. The professionalstaff would be increased from 13 to 35 during the term of the Project.

Research Program for Agricultural Products Utilization (Annex 7)

4.30 This Program (total base cost US$2.8 million) would focus onincreasing recovery of farm products, through reduced transit and storagelosses of farm products, and increased quality of farm products. TheProgram would also continue current research on quality enhancement, in-cluding protein enhancement of major foods used in depressed rural areas,in school lunch, and other such social programs.

4.31 The Program would continue to have its headquarters at Serdang.Collaborative commodity research would be conducted at the 5 product fieldstations; fruit and vegetable processing at Tampoi (near Johore Bahru);fish processing at Kuala Trengganu; rice processing at Alor Setar; eggs,poultry and meat processing at Mergong; a second fruit and vegetableprocessing station has been approved and budgeted for Kuala Kangsar (nearIpoh).

4.32 Research would be primarily concerned with (i) processing (storage,drying, and milling) of rice, (ii) processing of pineapple and other horti-cultural crops, (iii) processing of fish, poultry and meat, (iv) processingof field crops, (v) improving the quality of all agricultural products,and (vi) improving the efficiency of the processing industry through theapplication of engineering. Close links with the food processing industrywould be maintained. It is essential that the research findings are madeavailable to the public and private food industry sector (Annex 7, para 18)and assurances were given during negotiations to this effect. It was agreedthat in order to fully assist the food, feed and fiber industry and promotecooperation, that one member representing the private industry and one memberrepresenting the public industry would be appointed to the Agricultural Prod-ucts Utilization Research Advisory Committee (formerly Coordination Committeeon Food Technology); see Annex 7, para 12.

4.33 The Program would work closely with the commodity research programsin identifying those products and areas where research is urgently requiredand likely to produce the greatest benefit, and to set product grading stand-ards for crop varieties and maturity that will give the best return to thefarmer and the processor. An important aspect of integrated commodity re-search will be in the utilization of crop by-products.

*.34 Professional research staff would be increased from 25 to 40 by1980; the current ratio of supporting staff would be maintained. The Proj-ect would provide for 15 man-years of expatriate scientists: rice process-ing (2 man-years), fruit and vegetable processing (4 man-years), food en-gineering (3 man-years), quality control (3 man-years) and short-term

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consultants (3 man-years). These scientists would fill posts for whichlocal expertise is not available, and would provide a greater depth ofexperience to improve the focus of the research to be undertaken.

4.35 The Project would finance 44 man-years post graduate fellowshipsleading to about 8 PHD and 8 MSc degrees and 4 man-years for short termcourses and study tours. The candidates would be selected on the basis ofqualifications and the needs of the Program.

4.36 Equipment would be provided for pineapple and rice processingresearch, quality control, controlled atmosphere storage research, andvegetable oil research. The Project would finance the provision of aquality control laboratory to be located at Serdang.

Research Program for Agricultural Engineering and Water Management (Annex 8)

4.37 This is a new Program (total base cost US$2.3 million) in MARDIto provide supporting research to all of the commodity programs and to con-duct agricultural engineering and water management line research. The objec-tive of the Program would be to improve the production, harvest, storage andhandling of agricultural products. The greatest impact would be in the rice,field crops and pineapple subsectors.

4.38 The Program would initially have its headquarters for engineering,water management and workshops at Serdang, but would be actively engaged inresearch and would provide supporting services at all field stations. Whenthe field crops station is developed at Bertam estate, it would also becomethe headquarters for the Agricultural Engineering and Water ManagementProgram. The main workshops for equipment maintenance and prototypefabrication would remain at Serdang, close to the sources of supply forcomponent parts and raw materials.

4.39 Research will be concerned with the development of equipmentand techniques to facilitate extension and intensification of agricultureproduction, the development of farm equipment for local manufacture, tech-niques for land development, water control, and efficient utilization ofenergy. The Agricultural Engineering Program would be responsible for on-the-farm processing research, whereas the Products Utilization Programwould be responsible for off-the-farm processing research and obviouslytheir work would be closely integrated.

4.40 Research staff would be increased from 7 to 17 by 1980; the stand-ard ratio of supporting staff would be maintained for research. In additionthe Program would require a large complement of cl-illed labor to providesupporting services for the other Programs and for station operation andmaintenance.

4.41 The Project would finance 15 man-years of internationally re-cruited scientists: agricultural engineer-farm power and machinery (5man-years), agricultural engineer-farm machinery (3 man-years) to super-vise the workshops and design sections, agricultural engineer-drying and

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storage (3 man-years), agricultural engineer-farm structures (3 man-years)and short-term consultancies (1 man-years). All of these scientists wouldbe assigned in a full working capacity to participate in research programs,provide leadership and on-the-job training. A farm power and machineryengineer would also fill the post of Senior Scientist as head of the pro-gram. Collaboration with IRRI in the area of Agricultural Engineering andWater Management will be strengthened and expanded.

4.42 The Project would finance 21 man-years of fellowships leading toMSc and PhD degrees and 3 man-years for short-term specialized training andstudy tours. Candidates would be selected on the basis of their qualifica-tions and the requirements of the Program.

4.43 The Project would also provide for buildings, laboratory equip-ment, prototype fabrication equipment, design equipment, field equipment,and maintenance and repair workshop equipment..

Project Development Unit (Annex 9)

4.44 The Project Development Unit (total base cost US$1.1 million)would provide field verification and regional evaluation for the commodityresearch Programs. The Unit would work closely with the Department ofAgriculture Extension-Liaison Unit. It would carry out sociological studies,such as on the role of farm mechanization in smallholder agriculture, farmsize and farm incomes, and would thus assist in focusing MARDI's researchobjectives. It would measure the impact of the project and the rate oftechnology adoptation. Most importantly, it would focus on adopting re-search output into a smallholder-seed-fertilizer-technology package.

4.45 The Unit's professional staff would be increased from 9 to 29 by1980 and supporting staff would be increased accordingly. The project wouldfinance 7 man-years of expatriate extension and research specialists: re-search development specialist to assist in the organization and planning ofthe operations of the unit (3 man-years), rural sociologist (3 man-years),short-term consultancies (1 man-year).

4.46 The Project would provide 21 man-years of fellowships leading toMSc and PhD degrees and 3 man-years for short term training and study tours;and would provide for vehicles, printing, field testing and communicationsequipment.

Central Services in MARDI (Annex 10)

4.47 The Project would provide central analytical, computer, libraryand workshop services for all the Research Programs (total base cost US$2.4million).

4.48 The Project would provide essential modern instruments whichwould increase the accuracy and capacity of analytical work at the CentralAnalytical Laboratory. The Project would also provide for the evaluation

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of computer facility requirements and the provision of a computer for jointuse by MARDI and the Department of Agriculture. The computer would be usedfor research and for data storage and administrative work. MARDI has en-gaged consultants (to be financed under the project) to study the computerfacility requirements for MARDI and the Department of Agriculture's Exten-sion Liaison Unit. Disbursement for expenditures for computer equipmentand facilities will be based upon recommendations of the consultantsacceptable to the Bank.

4.49 Library equipment and materials would include cataloging andmicrofilm equipment, reference books, text books, back issues of researchreference journals, and subscriptions to current journals.

4.50 Central Workshops will be maintained for all of MARDI's work. Re-sponsibility for these workshops will rest with the Agricultural Engineeringand Water Management Research Program. Arrangements will be made for useof common facilities for station maintenance and operation.

Extension-Liaison Unit in the Department of Agriculture (Annex 11)

4.51 This Unit (total base cost US$4.0 million) would strengthen theExtension Service of the Federal Department of Agriculture to promote theefficient transfer of MARDI research results to the State Departments ofAgriculture, other Federal agencies, and through these, to Malaysia'sfarmers. The Unit would have its headquarters in facilities to be estab-lished in Kuala Lumpur.

4.52 The Unit would increase the flow of information on new varieties,crop diversification, cultural practices and other new and improved tech-nology. The Unit would work in close association with MARDI's ProjectDevelopment Unit to keep abreast of current research findings; it would inturn feed back information from the State extension services to MARDI. Thelatter would be an important measure of acceptance of research results andwould provide guidelines for determining areas of research and researchpriorities. One of the Unit's important activities will be the trainingof extension staff in all Federal and State agencies.

4.53 The Unit would rapidly build up a staff of 18 professional offi-cers and about 46 supporting technical officers. Some of these officerswould be drawn from the existing extension service, but most would be newrecruits. The Project would provide nine man-years of expatriate extensionspecialists: senior extension officer to assist in the organization, plan-ning and implementation of the unit (1 man-year); extension specialists (8man-years) to strengthen leadership conduct extension and on-the-job train-ing in agro-protection, soils, mechanization and farm management.

4.54 The Project would finance 94 man-years for training, specialcourses and study tours, to upgrade and expand professional and sub-profes-sional staff and would finance the construction of a building complex forthe extension-liaison headquarters, and would provide laboratory equipment,audio visual equipment, office equipment, field equipment and vehicles.

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V. ORGANIZATION AND MANAGEMENT

A. Organization (MARDI)

Management Structure

5.01 The MARDI Act (Annex 1, Appendix 1) creates a semi-autonomousorganization. The Ministers for Agriculture and Finance however haveoverriding responsibilities in the fields of policy and financing. TheAct specifies that MARDI shall be managed by a Director and two DeputyDirectors. Within this legal constraint the Project had to devise amanagement mode which would be suitably structured to conduct commodity- production oriented research and which would create a proper balancebetween the demands of research and the demands of a public service or-ganization, in the administration of public funds.

5.02 The management structure which would permit this was formallyapproved by the MARDI Board in November 1974. 1/ The Director, who alreadyis Chairman of the Governing Board and a member of the Scientific Council,is responsible for the whole of MARDI's operations, as specified in theMARDI Act. Two Deputy Directors would operate under the Director of MARDI;one would be responsible for Research Programs and the other for Developmentand Administration. Both would be senior officials who had made their careerin technical fields, appropriate to their function. Moreover, both would beexpected to make their career in MARDI (unlike the present situation wherethe only Deputy Director now in MARDI is a senior public service administra-tor seconded to MARDI for a limited period of time). In accordance with thenew organizational structure and the MARDI Act, Part II, Section 4(1) (seeAnnex 1) the Director and Deputy Directors shall be appointed by the Yangdi-Pertuan Agong from among persons nominated by the Minister of Agricul-ture after consultations with the Scientific Council.

5.03 The proposed structure would provide for five Assistant Directors.The Assistant Director for Production Research 2/, the Assistant Directorfor Fundamental Research and the Assistant Director for Research Serviceswould report to the Deputy Director for Research Programs. The AssistantDirector for Development and the Assistant Director for Administration wouldreport to the Deputy Director for Development and Administration.

1/ The MARDI Organization Chart is shown in Annex 1, Chart 9523.

2/ For organization of research, Annex 1, para 23-31.

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5.04 The lower echelons, responsible for producing the actual research"eat the bench", are organized in 3 groups, - Production Research, Back-stopping Research, and Research Services. This unit-structure facilitatesall parts of research, and enables the Project to finance the specific re-search efforts for which Bank support was requested by GOM.

5.05 Each of the commodity and other research groups would be headedby a Senior Scientist as program coordinator. Initially, the head of theAgricultural Engineering and Water Management Program would be filled byan internationally recruited scientist with qualifications acceptable tothe Bank. A Senior Scientist has been appointed as head of the Agricul-tural Products Utilization Program and it was agreed at negotiations thatthe curriculum vitae of the scientist would be sent to the Bank for clear-ance.

Commodity Research Groups - Backstopping Research Groups

5.06 MARDI's commodity research groups would be organized in 7 com-modity programs (rice, oil palms, field crops, horticultural crops, live-stock, freshwater fish, cocoa/coconut), and an agricultural productsutilization program. In addition these would be a backstopping researchdepartment for research in such fields as soil, plant and animal sciences,analytical services and crop protection. These Programs are responsibleto the Assistant Directors for Production Research and Fundamental Researchrespectively 1/.

5.07 Each commodity research program would concentrate its work on thewhole spectrum of technology associated with the particular commodity, andwithin each group all the disciplines necessary for such broad spectrum workwould be represented on the interdisciplinary team. Specialists from theresearch services and backstopping research groups would be secured forvarious periods of time, as and when required, to work with the commoditygroup teams.

5.08 The Agricultural Products Utilization Research Program would forman important link between the producer and the consumer. In the past thiswork was carried out by the FTRDC, which was transferred to MARDI on October 1,1974.

Research Service Groups

5.09 Alongside the research programs, Research Service Groups wouldoperate under an Assistant Director responsible to the Deputy Director ofResearch Programs. Two groups (agricultural engineering and water manage-ment, and stations and facilities) would provide key professional supportservices to the whole of MARDI's research effort.

1/ For organization of research,-Annex 1, paras 20-23.

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5.10 The Assistant Director for Research Services would be responsiblefor the development and maintenance of MARDI's research stations and facil-ities. The farm managers of these stations would report to him. On thosestations where more than one research group would operate, station committeeswould be formed to ensure proper coordination of the farm work and to set workpriorities in consultation with the local farm managers.

Research Administration

5.11 Development of MARDI's administrative and management functionswould be the responsibility of the Assistant Director Administration andDevelopment. In view of the major expansion program now under way inMARDI and which would be accelerated through the Project, the ProcurementUnit would be strengthened to handle the procurement work associated withthe expansion program. The Unit would form the liaison with the MalaysianTender Board and other supply agencies and would be responsible for theday-to-day work of administering the recording requirements under theproject. It was agreed at negotiations that the Administrative Sectionand Procurement Unit would be increased by 3 additional staff appointedto MARDI to facilitate procurement and accounting for equipment purchasedunder the Project.

5.12 The Project Development Unit would report to the Assistant Directorfor Development. It would be responsible for field verification trials offindings by the commodity research groups. The Unit would collaborate withthe Federal and State Departments of Agriculture - and other governmentbodies in the agricultural field. The Unit therefore would be MARDI's windowon the agricultural scene and it would form the first link in gettingthe research output "on the market". The Project Development Unit would bemore decentralized than other MARDI groups and would have small groups ofstaff permanently located in a number of areas throughout Malaysia.

B. Staffing (MARDI) -y

Local Staff

5.13 The essential staff structure below the top management group, isbased on a ratio of two research assistants and four junior research assis-tants and/or technicians for each research scientist. The junior assistantsnormally are new University or Diploma graduates and form the pool out ofwhich, after further post-graduate training through fellowships, the futureprofessional cadre is built up.

1/ Annex 12, Table 12.4 shows the overall program of staffing expatriatestaffing and fellowships.

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5.14 MARDI management has anticipated the severe recruiting problemflowing from its expansion program. It has currently 170 students (in-creasing to 300 by the end of 1974) in local Universities on MARDI scholar-ships. Graduates from this program with BSc or Diploma status will joinMARDI as junior research officers. MARDI also has more than 60 staff andnon-staff members in overseas Universities who will join MARDI after obtain-ing higher degrees. This program of training would be strengthened by theProject which provides the FE cost for overseas fellowship leading to about70 PhD and 70 MSc degrees.

5.15 The postgraduate students would focus their fellowships on pro-grams of study and research relevant to MARDI's research objectives. This,as far as practicable, would be achieved by requiring Fellows to do theirfield work in Malaysia, combined with study and thesis work at overseasInstitutes. Concurrence by the Bank to the locus and subject of studieswould be sought.

Staff Salaries

5.16 The Harum Salary Commission Scales were implemented in January,1975. MARDI's salary are now being adjusted to be on par with RRIM andthe Agriculture University; it was also agreed at negotiations that GOMwould maintain MARDI salaries at an equitable level.

Expatriate Staff

5.17 The Director of MARDI would be responsible for engaging the inter-national scientists to be financed under the Project. These scientists wouldwork within the various Programs and through the Program Coordinator would beresponsible to the Assistant Directors. Because of the important contribu-tion these scientists would make to the development of MARDI, the Bank'sconcurrence would be sought for long term appointments of internationalscientists (para 6.04(A)(a)). The substantial expenditure on internationallyrecruited staff is required to maintain the strength of the research programswhile the staff fellows are overseas. In general, the expatriate inputswould maintain this strength at somewhere between 70% and 90% of the estab-lishment during the development period (Annex 12, Table 12-4).

C. Organization (Extension-Liaison Unit)-1/

5.18 The Extension-Liaison Unit would be a new part of the existingExtension Branch of the Federal Department of Agriculture. The Unit willbe headed by a Senior Agricultural Officer with solid experience in exten-sion services and qualifications acceptable to the Bank. To facilitatethe transfer of MARDI research finding to the Department and disseminate

1/ Annex 11, WB Chart 9155.

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information to the farmers the Unit would consist of four main functionalsections; i.e. communications, data processing, projects, and subject matterspecialization.

D. Staffing (Extension-Liaison Unit) -/

5.19 Fellowships (94 man-years) for the Unit's staff would be anessential component of the Project. These are required to provide quali-fied manpower for the Unit and would aim at post-graduate courses andmedium and short-term refresher courses available to all Departmentalstaff in order to increase rapidly the strength of the Unit to an accepta-ble level.

5.20 Longterm internationally recruited staff would initially be en-gaged for planning and implementation of the Unit; partly to offset thework input foregone by local staff pursuing their fellowships. Duringproject implementation, further expatriate staff would be engaged on ashort-term basis to assist in planning and implementing the specializedsubject matter units.

E. Project Monitoring

5.21 An essential requirement for the proper functioning of a researchorganization, not only MA1hRDI, is periodic reviews of its research program byeminent scientists, not directly associated with the organization, to ensurethat the research undertaken is relevant to the needs of the agriculturalsector and to ensure efficient utilization of the research resources. Theseperiodic external technical program reviews supplement internal reviews con-ducted annually by scientists from the different programs, i.e. scientistpeers commenting on the work carried out in MARDI. These reviews would beundertaken in liaison with the Scientific Council.

5.22 The Project would provide for both annual internal technicalprogram reviews by MARDI Scientist and for such periodic external reviewsby a panel of eminent scientists when appropriate, selected by MARDI'sDirector in consultation with the Bank. The project would provide thefunds for the engagement of such reviewers on an agreed basis. The selec-tion of the reviewers would be based on the particular program or programsto be reviewed in each instance. Perhaps one reviewer might be used eachtime a review takes place, whilst his capability might be augmented byither specialists to fit the specific review program. It was agreed atnegotiations that scientists, acceptable to the Bank, would be engaged forperiodic reviews of MIRDI's research programs as appropriate.

1/ Annex 12, Table 12.4 shows the overall program of staffing, expatriatestaffing and fellowships.

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F. Cooperation with International Research Institutes

5.23 MARDI is already collaborating with international researchinstitutes, particularly in its research relating to rice and small farmmechanization. Also MARDI already has contact with international institutesresponsible for research in tropical agriculture and field crops (includingmaize, sorghum, soybean and cassava). The Project will seek to strengthenthese contacts and to make other linkages. In addition to direct col-laboration in the various MARDI research programs the Project would financefellowship for MARDI staff for both short and longer term visits to relevantinternational institutes. These established and similar contacts withUniversities will facilitate MARDI's recruiting program.

C. Financing, Accounting and Audit

5.24 MARDI is financed through the annual GOM budget. To improve longterm planning, GOM, EPU and Treasury officials have approved MARDI's BlockGrant request to cover the Third Plan Period. However, it is essentialthat the flow of funds from treasury sources would be coordinated with theexpanded level of activity proposed under the Project. Therefore, furtherrevision of the Block Grant is required to integrate the Project Budget withthe Block Grant Budget.

5.25 Under the Project, MARDI would initiate an approved Program Budget-ing System and its accounting procedure would be modified to facilitate iden-tifications of goods and services financed by the Project. These accountswould be implemented in accordance with an agreed system and timetable tobe worked out no later than the first Project Supervision. These accountswould be kept in accordance with sound accounting principles and would beaudited by independent auditors, acceptable to the Bank, within six monthsafter the end of the financial year.

VI. PROJECT COSTS, FINANCING, DISBURSEMENTS AND PROCUREMENT

Project Costs (Annex 12)

6.01 The Project would assist GOM with financing the FE component(US$28.5 million) for 8 selected research programs during the period 1975-1981. The base cost estimate was calculated on late 1974 prices. A 5%physical contingency was added to all componenets of the project. A pricecontingency of 45% (US$32.2 million) was added to the project base cost inaccordance with current projections and international and local pricechanges. The price contingencies are: 54.3% on local costs (15% inyear 1 reduced to 10% in year 6); 21% on equipment (14% 1974, 11% 1975and 7.5% thereafter); and 14.5% on the FE component of services (5% perannum). (Annex 12).

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PROJECT COST ESTIMATES

US$ x 1 million M$ x 1 million FESub- Items eauivalent equivalent ComponentTotal Local Foreign Total Local Foreinn Total

I MARDT Research Groups

Expatriate Scientists, 0.9 5.5 6.4 2.2 13.5 15.7 85%Collection Missions

Staff Fellowships - 4.1 4.1 - 10.1 10.1 100%Building and SitefDevelopment 1.9 0.9 2.8 4.7 2.2 6.9 33%

Fertilizer, Herbicides,Semen and Stockfeeds 001 1.7 1.8 0.3 4.2 4.4 94%

Field Equipment, Vehicles& Land Development 0.1 1.6 1.7 0.2 3.9 4.2 94%

Research Equipment - 2.9 2.9 - 7.1 7.1 100%Computer and Library,Central Services - 2.1 2.1 - 5.2 5.2 100%

Livestock 0.1 1o2 1.3 0.2 2.9 3.1 92%MARDI Sub-total I 3.1 2Q.0 23.1 7.6 49.1 56.7 87%

II Department of AgricultureExtension-Liaison Unit

Expatriate Scientists 0.1 0.5 o.6 0.3 1.2 1 5 85%Staff Fellowships - 1.4 1.4 - 3.4 3.4 100%Building and SiteDevelopment 0.9 005 1 4 2.2 1o2 3-4 33%

Field Equipment, Vehicles,Land Development - 0.3 0.3. - 0.7 007 100%

Research and ExtensionEquipment 0.1 0.2 0.3 0.2 0.5 0.7 66%

Extension Liaison Unit 1. . . . . . 2Sub-total II 1.1 2.9 4.0 2.7 7.0 9.7 72%

III Staff and Local Costs 45.2 - 45.2 110.7 - 110.7 -

IV Project Base Costs(I+II+III) 49.4 22.9 72.3 121.0 56.1 177.1 31.7%

V Physical Contingencies 5% 2.5 1.1 3.6 6.1 2.7 8.8 30%

VI Project Costs, includingPhysical Contingencies(IV+V) 51.9 24.0 75.9 127.1 58.8 186.0 31.6%

VII Price Contingencies OverProject Period on:

Local Costs 28.2 - 28.2 69.1 - 69.1 -Equipment - 2.4 2.4 - 5.9 5.9 100%Expatriate Salaries and

Fellowships - 1o6 1.6 - 3.9 3.9 100%

Price ContingenciesSub-total VII 28.2 4.0 32.2 69.1 9.8 78.9 12.4%

Prolect Total Costs*(VI+VII) 80.1 28,1 108.1 196.2 68.7 264.9 26%

Rounding Factor - 0.4 0.4 - 0.8 08 100%Project Costs 80.1 28.5 108.5 196.2 69.5 265.7 26.3%*Of Which Local Staff

Costs 30.1 - 30.1 73.8 - 73.8 -

- 25 -

Financing - Annex 12

6.02 GOM would provide MARDI with the required local currency throughan annual or multiyear grant. The FE component of the Loan to GOM, wouldalso be passed on as a grant to MARDI. Provision for this procedure isavailable in the MARDI Act 1/. A similar procedure would be followed forthe financing of the Extension-Liaison Unit in the Department of Agricul-ture.

Disbursements - Annex 13

6.03 The Project would finance 100% of the foreign exchange cost ofengaging internationally recruited senior scientists, the provision ofFellowships, the cost of overseas missions to collect plant materials,project monitoring, equipment and supplies, and livestock. It wouldfinance 100% of ex factory cost of locally manufactured goods and equip-ment and 70% of imported goods procured locally. It would finance theforeign exchange component of building construction which is estimatedto be 33% of the total cost of all buildings to be constructed under theProject (Annex 12). Assuming loan effectiveness on May 31, 1975, disburse-ments would commence in the first quarter of FY 1977 when expanded facili-ties for research would become available. The Project would be completeby December 31, 1981. The Disbursement Schedule is shown in Annex 13,Table 13.1. It is based on slow disbursement in the first year of theproject, to permit recruiting and procurement procedures to be established.Any surplus funds remaining after completion of the Project would be can-celled.

Procurement (Annex 13)

6.04 For each of the broad expenditure groups referred to below, adifferent procurement procedure would be followed.

(A) Services

(a) Internationally Recruited Specialists (US$7.0 million)would be engaged by the Director of MARDI or the Directorof the Extension-Liaison Unit through arrangements to beagreed by the Bank.

(b) Fellowships (US$5.5 million) would be awarded to staffmembers selected by the Senior Scientist and approvedby the Director of MARDI.

Arrangements for recruiting of the specialists and the management of thefellowship program for both MARDI and the Extension-Liaison Unit would behandled under arrangements to be agreed between these organizations and

1/ Annex 1, Appendix 1, para 14.

- 26 -

the Bank. A standard format would be used for the Fellowships. The fel-lowship programs shall be administered and managed under arrangements tobe agreed upon by the Bank. It was also agreed at negotiations that anadvance draft of the fellowship contracts would be submitted to the Bank.

(B) Goods

(a) Goods (US9.0 million) other than livestock and thecomputer (US$1.3 million) would be procured on thebasis of international competitive bidding in accordancewith Bank Group Guidelines. However contracts forgoods estimated to cost the equivalent of not more thanUS$20,000 would be let according to normal GovernmentProcedures which are satisfactory. A margin of pre-ference of 15% would be given to local manufacturers inbid evaluation. Contracts for similar goods would bebulked to attract foreign as well as local bidders.For reasons of animal health services livestockpurchases could be made only in a limited number ofcountries and the Director of MARDI would submit alist of countries for the purchase of each classof livestock for the Bank's concurrence. All livestockpurchases and sales would be administered through aLivestock Fund (Annex 13), the creation of which wouldbe a condition of disbursement for all livestockpurchases. The computer would be purchased or leasedfollowing arrangements to the agreed by the Bank(para 4.48);

(b) Contracts for the construction of buildings (US$1.4million) would be awarded on the basis of interna-tional competitive bidding in accordance with BankGroup Guidelines. No restrictions would be placedon bidding, however, due to the small size andscattered nature of the contracts they areunlikely to be of interest to foreign contractors.Malaysia has a viable local contracting industryand it is expected that local contractors wouldwin all bids;

(c) The Bank's prior approval would be required befbreinvitations to bid are issued and contracts are awardedfor equipment purchases and construction of buildingswhere contracts are estimated to be in excess ofUS$100,000 equivalent, and for the purchase of allclasses of cattle.

- 27 -

VII. JUSTIFICATION AND BENEFITS (ANNEX 14)

7.01 An overwhelming part of agriculture is in the hands of small farm-ers who do not have the means to carry out their own research. Yet, an ex-panded effort in agricultural research and extension is needed if the socialand income status of these small farmers is to be improved. A major Govern-ment effort is called for to provide the small farmers with the technologyto improve their incomes. This justifies research on rice, cassava, cocoa,coconut, pineapples and livestock; all traditional smallholder crops. Re-search on rice and field crops for livestock feed is justified also becauseit will assist in minimizing the risk of supply failure of these basic com-modities (Annex 14, para 26).

7.02 In support of this general justification an attempt was made toassess the value of a research and extension project to Malaysia. As indi-cated in Annex 14 given present methodology, a research and extension projectmay not lend itself in all cases to traditional benefit cost analysis becauseof the uncertainty surrounding the resources required to bring a particularpiece of research to its conclusive end. Instead, historical and analoguedata of research and extension efforts in Malaysia and other countries wereexamined.

7.03 This examination (full details in Annex 14) indicates that:

(a) In 1965 Malaysia was spending comparatively less onagricultural research and extension than most otherAsian countries. The decision made not long after,in 1967/68, to expand such research in Malaysiathrough the creation of MARDI in 1969 appears tobe justified on these grounds.

(b) There is evidence that in Malaysia physical constraintsexist on cropping areas, or cropping technology of cropswhich, on social and economic planning grounds, needexpansion in aggregate output. These constraints canonly be removed through the introduction and/or adop-tion of new technology (paras 4.05-4.50).

(c) Rates of return calculated only to quantify the costof time lags, based on analogue evidence from Malaysia'srubber industry, which, if applied to some basic datafor four of MARDI's research programs, indicate thata reduction in the research-extension lag is a justi-fiable objective.

(d) Derived from the success of the RRIM there is inMalaysia a climate of justifiable pride in, and

- 28 -

political and financial support for, a program ofresearch in agriculture. Since agricultural researchis at the best of times a long-term effort, suchsupport is absolutely essential and is perhaps thebest guarantee that broad research objectives can beestablished and maintained.

(e) There is ex-post evidence from other countries, on thebasis of rates of returns to individual crop researchprograms and in terms of aggregate output per hectare,that agricultural research is a sound national in-vestment.

(f) There is evidence that a definite relationship existsbetween aggregate net output per hectare and theresearch-extension effort in a selected group of 11Asian countries.

7.04 Whilst no one of the foregoing indicators (a-f) in isolationcould provide full justification for the Project, - taken together, theygive every indication that it would be beneficial to Malaysia's agricul-tural sector generally, and to the smallholder sector in particular inat least sufficient measure to justify the program.

VIII. AGREEMENTS AND RECOMMENDATIONS

Agreements

8.01 During negotiations, agreement was reached on the following impor-tant points:

(a) MARDI shall employ one competent Senior Scientist(head of the program) each, with qualificationsacceptable to the Bank, for its Agricultural Prod-ucts Utilizations Research Program and for itsAgricultural Engineering and Water ManagementResearch Program. (Para 4.42).

(b) MARDI salaries are being adjusted through theimplementation of the Harum Salary CommissionScales and will be maintained at a level equitablewith RRIM and the Agriculture University, the ini-tial adjustments shall have been implemented within6 months of the date of the Agreement. (Para. 2.19).

- 29 -

(c) MARDI shall engage eminent scientists (acceptableto the Bank) to undertake periodic reviews of theon-going research programs. (Para 5.21 and 5.22).

(d) Recruitment of specialists, and operation of fellow-ship programs (MARDI and ELU) included in the Projectwill be managed under arrangements to be agreed uponbetween the Bank, and MARDI and ELU. (Paras. 5.15,5.17 and 6.04A).

(e) The Department of Agriculture will establish and main-tain, within its department, an Extension Liaison Unit(ELU) with staff acceptable to the Bank. (Paras. 4.22and 4.51-4.54).

(f) Within 9 months after the date of the agreement, MARDIshall employ a Program Specialist in consultation withthe Bank to assist the Deputy Director for ResearchPrograms in planning, coordinating and implementingresearch programs. (Paras. 4.04 and 4.06).

(g) The Government of Malaysia will make necessary arrange-ments to expand and strengthen agricultural extensionservices at the state level to facilitate transfer ofresearch findings and requirements between the farmerand MARDI. (Para 2.22).

Conditions of Credit Effectiveness

8.02 During negotiations, the following conditions of effectivenesswere agreed:

(a) One member representing the public food processingindustry and one member representing the privatefood processing industry shall have been appointedby MARDI to the Advisory Committee on Product Utili-zation (formerly Coordinating Committee on Food Tech-nology). (Para. 4.32).

(b) Three additional staff shall have been appointed tothe MARDI procurement unit. (Para 5.11).

Conditions of Disbursement

8.03 During negotiations, the following conditions of disbursementwere agreed:

(a) The Bank will not disburse for expenditures asso-ciated with the Agricultural Products UtilizationProgram, and the Agricultural Engineering and WaterManagement Program until satisfactory evidence has

- 30 -

been provided to show that the first appointmentsto the posts of Senior Scientist (heads of theprograms) have been made. (Para. 4.42 and 5.05).

(b) The Bank will not disburse for expenditures for thelease or procurement of computer equipment untilevidence satisfactory to the Bank has been furnished:

(i) That an acceptable computer consultant's studyhas been completed for MARDI and ELU,

(ii) Adequate provisions have been made for training,operation and maintenance of the equipment,(Para 4.48).

(c) The Bank will not disburse for expenditures for livestockuntil satisfactory evidence has been provided that aLivestock Fund, for the exclusive use for procurement andsale of livestock out of proceeds of the project, has beenestablished within the MARDI Fund. (Para. 6.04B(a)).

8.04 The Project is suitable for a loan of US$28.5 million.

April 25, 1975

ANNEX 1Page 1

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

Agricultural Education, Research and Extension Services

A. Introduction

1. Malaysia's agricultural education, research and extension serviceshave had a continuous history of development over several decades. In con-trast to the situation in many other former colonial territories, tnere wasno disruption of these services when Malaysia became independent in 1957.However, further development in all these services is required to meet thepresent and future needs of Malaysian agriculture.

B. Agricultural Education Services

ihigher Education

2. There are two schools of agriculture in Malaysia, the oldest, theFaculty of Agriculture in the University of >ialaysia is scheduled to closein 1977. It is currently awarding 80-100 first degrees and about 10-15Masters' degrees annually. PhD courses are of recent origin and only twoPhD candidates are currently enrolled. The new Agricultural University atSerdang enrolled its first agricultural, forestry and veterinary studentsin 1973. About 100 first degrees are expected to be awarded in 1976, witha projected increase to 250-300 within a few years, including graduates ina new course, BSc (Agri-business).

3. In addition to graduates receiving agriculture, veterinary, andforestry degrees, there are also three institutions offering degrees in anumber of agriculture related sciences. These are, the University of Mlalaya(Science and Economics and Administration Faculties), Naeional University(Science, Economics and Management Faculties), and the University of AppliedScience at Penang. The current annual output of graduates from the ScienceFaculties of these Universities is about 500 Bachelors - 300 Honours - 30Mlasters' - and 4 PhD degrees. Tne present output of the Economics, Admin-istration and Management Faculties is about 400 Bachelors degrees, but onlya few Ilasters' and no PhDs degrees.

ANiEX 1

Page 2

4. University education in Malaysia is still in a developmentalphase, and the emphasis hitherto has been on training at the undergraduatelevel. Only recently has attention been given to the development of post-graduate programs.

5. Because of the lack of post-graduate training at its own Uni-versities, Malaysia depends on overseas universities to train Malaysianstudents to Master and PhD level in agriculture and agriculture relatedsciences. Malaysian graduates are readily accepted for post-graduatestudies at universities in UK, USA, Australia and New Zealand, the prin-cipal countries providing this training. At the present time there areabout 100 staff from Malaysian Government agricultural institutionsworking overseas for higher degrees. The greatest number is from MARDIwhich currently has 63 staff members overseas receiving Masters or PhDtraining. MARDI also has 15 of its staff receiving post-graduate train-ing in Malaysia. This program should greatly reduce the present criticalshortage of personnel with advanced training.

Sub-Professional Agricultural Education

6. Malaysia has two Institutes awarding diplomas on the basis ofthree or four years' training in agriculture and agriculture-related sub-jects. These are the Agricultural University at Serdang and the IHIara In-stitute of Technology. Almost 500 Diplomas were awarded in 1974, of which,325 were Diplomas in Agriculture from Serdang, and the balance distributedbetween courses in animal health and production, forestry, and plantingindustry management. New courses in animal science, fisheries, home economics,food technology, and microbiology have been commenced and the output ofdiplomates will rise to 700 to 800 in two to three years.

7. Diplomates from these school find ready employment as sub-professionalsin government and semi-government agencies, and in private industry. Ingovernment service they operate at the technical level in scientific work,or as district extension offices. Despite the considerable and growing out-put of diplomates, there is shortage of qualified personnel at this level.At the present rate of training diplomates, it is expected that supply anddemand of qualified teclnical personnel will be in equilibrium within afew years.

8. There are also five institutes awarding Certificates of Agriculturebased on a three-year course, and four vocational schools giving two yearsof training leading to a more practically orientated Vocational Certificatein Education (Agriculture). People holding these Certificates are eligiblefor employment as laboratory and field assistants and as field extensionofficers. The Veterinary Department trains about 20 assistant veterinaryofficers a year in a two year course at Kluaiig for employment in Depart-ment's extension service. With the increasing output of the training ins-titutions it is expected that the current shortage of sub-professional staffwill ease in the next few years.

ANNEX IPage 3

C. Agricultural Research Services

Introduction

9. The-value of well-conceived and executed commodity oriented agri-cultural research in Malaysia has been amply demonstrated by the successof the RRIM. Established in 1927 as an autonomous government authority,it is recognized as the leading rubber research center in the world. Asthe result of the applications of the research findings of RRIM, Malaysiaproduces a major share of the world's natural rubber, and the average yieldof rubber per acre in Malaysia is by far the highest in the world.

10. Unlike rubber, other agricultural research activities have beenfragmented and less effective. Pineapple research was done by the ITIBand the oil palm producers (mainly estates until very recently) carriedout their own research. FELDA found that the research services availablein the late 1970's were inadequate for its smallholder development programs,and established its own small research unit to work on oil palm, cocoa andshade trees at Sungai Tekan in the Jengka Triangle.

11. Until the formation of MARDI, a major responsibility for agri-cultural research, other than for rubber, rested with the Department ofAgriculture and the Veterinary Department in the Ministry of Agriculture.The Departments were responsible for regulatory services, education andother farmer services, and were not primarily research oriented.

12. A review carried out in 1968 noted a number of deficiencies inresearch capacity in these Departments and indicated the need for improvedfield facilities and field and laboratory equipment, better trained personnel,improved library facilities, and improved administrative procedures.1/Practical problems in research organization were identified at that time,viz., the need to ensure problem orientated interdisciplinary collaboration,and continuity of programs, with budgetary and staff stability. The con-solidation and co-ordination of agricultural research (except rubber) intoa single organization was recommended.

D. Malaysian Agricultural Research and Development Institute (MARDI)

13. In 1969 the Government passed the MARDI Act to implement therecommendations. (Appendix 1). It was envisaged that the Institute wouldtake over all the research functions of the Department of Agriculture andthe Veterinary Department, the Malaysian Pineapple Industries Board and theMinistry of Agriculture's Food Technology Research and Development Center.

I/ Research for Agricultural Development in Malaysia, A.H. Moseman, 1968.

ANNEX 1Page 4

MARDI was given responsibility for scientific, technical, economic andsociological research in Malaysia with respect to production, utilizationand processing of all crops (except rubber), livestock and fresh water fish.i4URDI was also given the function of providing an agricultural informationservice, to disseminate research findings and technical information to theextension specialist, and to establish liaison with other research organiza-tions. The Act provided for the appointment of a Director and two DeputyDirectors.

Administration and Staffing

14. The Director is Chairman of a Governing Board comprising repre-sentatives of various Ministries, including Agriculture, Finance and PrimaryIndustries and not more than five members with experience in agriculturalresearch or agriculturel development programs. Its main functions are todetermine MARDI policies on administrative procedures and staffing, approvebudgets, and grants-in-aid for research to other organizations and approvefellowship recipients. The Ministers of Agriculture and Finance would beultimately responsible for pplicy and financing of M4ARDI, which in allother respects would have a great deal of autonomy.

15. The MARDI Act also specifies a Scientific Council appointed bythe Minister of Agriculture to include representatives of the four majoruniversities, RRIM, agricultural industry, Ministry of Agriculture and theEconomic Planning Unit (EPU) of the Prime Minister's Department, the Directorof AURDI and one of the Deputy Directors as Executive Secretary. The mainpurpose of the Scientific Council is to advise on the priority and formulationof research programs, and on locations and facilities for research. It alsomaintains liaison with other organizations involved in researcn, and adviseson evaluation procedures of professional staff and on library services andpublication. The Governing Board and Scientific Council meet at least fourtimes a year.

16. The MARDI Act also permits the establishment of a Fund into whichgrants by the Federal and State Governments can be deposited as well as incomereceived by M4ARDI from sale of produce and services rendered. The Act permitstile M'inister of Finance to impose special cesses on agricultural commoditiesto support agricultural research, which would also be paid'into the MARDIfund.

17. Although MARDI was formally inaugurated on October 28, 1969,transfer to it of the administrative responsibility for some of the re-search activities within the Ministry of Agriculture was not completeduntil late 1970. Tnie physical transfer of staff, field activities, labo-rawories and other research facilities did not commence until January 1971.Ti'us, M-ARDI hias only been in operation for about 3-1/2 years. Its firstDirector, Dr. A.H. Moseman, was replaced by Dr. Encik Anuwar bin Mahmudwho was the Director until March 31, 1975.

ANNEX 1Page 5

18. MARDI has grown rapidly and now has a larger professional staffthan RRIM. As of July 1, 1974, it has 126 graduate research officers, in-cluding five Principal Research Officers, three Senior Research Officers,34 Research Officers and 84 Assistant Research Officers. Only nine of thegraduate officers have PhD degrees. There were 127 Research Assistantsand 200 Junior Research Assistants. Total MARDI staff as of April 1974numbered 891. This rapid growth of staff is expected to continue throughto 1980 when MARDI expects to have over 500 graduate staff.

19. Most of the graduate staff have a good basic training, but donot have higher degrees or research experience. Lack of research experi-ence and experienced leadership is one of the greatest decifiencies of*MARDI. Strengthening of research leadership is urgently required to make

the most effective use of its large and enthusiastic young staff. ihegrowth and development of physical facilities and research programs hasbeen equally as rapid as the increase in staff. This has placed a con-siderable burden on the Director.

Organization of Research

20. The Scientific Council nas formed a series of Research AdvisoryCommittees to review and advise on each of MARDI's major commodity researchprograms. These Committees are composed of a member of the Council anduniversity and industry representatives. Some, such as the Oil Palm ResearchAdvisory Committee, are very active and meet several times yearly. Othersare not as active. The major commodity programs under review are rice, oilpalm, horticulture crops, field crops, cocoa and coconut, livestock andpineapple.

21. It is becoming clear from the work done to date trhat MARDI wouldorganize its research work most effectively if it were to focus its activi-ties on a number of commodity research programs, with suitable supportingresearch being carried out by a few specialized groups. A suitable organi-zation to give effect to this type of operational structure is shown inChart 9206.

22. 1ie MARDI Act gave the Institute responsibility for researchin the utilization and processing of all agricultural crops (except rubber)livestock and freshwater fish, to this end, the Food Tech~nology Research andDevelopment Centre was transferred to IMARDI on October 1, 1974. Its structureis shown in Chart 9112.

23. There are some other activities of a research and semi-researchnature remaining in the Agricultural and Veterinary Departments. The ani-mal breeding work being done by the Veterinary Department is competitivewiti1 the MARDI's work. It should be discontinued and the appropriate fa-cilities transferred to MARDI. The Animal health work in the Veterinary

ANNEX 1Page 6

Department is of a high standard but is mainly of a regulatory and servicenature and should remain in the Department. The Department of Agriculturesoil classification and soil analytical work is also of a high standard.It should remain with the Department because it is not research per seand the need for close integration with the Department's extension activ-ities.

Research Facilities

24. The headquarters of MARDI are located in a complex at Serdang some30 minutes from Kuala Lumpur. The complex includes the newly establishedAgricultural University. At present MARDI occupies a series of cramped andtemporary buildings and these have poor facilities for research. New head-quarters are under construction and are scheduled for completion in 1975.They will include the following separate buildings: administration; library;theater; crop improvement; animal improvement; crop protection; soils, waterand engineering (2 three-story buildings); and economics and statistics. Aseparate budget has been approved and allocated'for the construction of thesefacilities which will encompass 200,000 square feet at a cost of M$5.5 million.

25. Including headquarters, MARDI has 16 research stations and twoProject Development Unit centres which conduct their studies on farmers' land.These stations are in various stages of development ranging from some (e.g.,Bumbong Lima and Jalan Kebun) which are well developed and support activeresearch programs to others (e.g., Kluang) which are only recently acquiredand are in process of establishment. Overall the spread of stations providesa satisfactory cover of Malaysian crop environments (see Appendix 2: Listof Research Centers and Field Stations and Map).

Project Development Unit

26. The MARDI Act gives the Institute the responsibility "to act asa centre for specialist extension service in the agricultural industry".However, the main task of extension to the farming community rests withthe Agriculture and Veterinary Departments and other Federal and StateGovernment agencies. These agencies and MARDI have recognized the need forMARDI to undertake local verification trails, and confirmed the Departmentsas the principal agencies of extension at the farmer level.

27. MARDI has recently formed a Project Development Unit to undertakefield verification trials, provide an information service, effect liaisonwith the extension agencies, and undertake sociological studies to assistin determining the Institute's research priorities. The need for harmoniousand close co-operation with the extension agencies is well recognized.

Outside Support

28. MARDI is receiving outside technical and financial support from11 different sources. The support for technical assistance and equipmentcomes from FAO, Tropical Agricultural Research Center-Japan, USA-Peace Corps,CSIRO-Australia, Germany, ODA, Belgium, and Australia Volunteers. Thelargest grant is from the Oil Palm Growers Council of Malaysia for M$633,000.

ANNEX 1Page 7

Funding

29. MARDI receives its funds through direct budgetary allocations fromGovernment as part of the Ministry of Agriculture's budget. The Ministry'sbudget amounted to a total of M$49.87 million operating and M$127.58 mil-lion development budget for 1974. Of these amounts, MARDI's budget for 1974is M$10.20 million for operating expenses and M$9.45 million for development.

30. Concern for future funding resulted in MARDI being requested bythe Prime Minister to prepare a Block Grant Proposal for 1975-1980 whichwould include provision for the Third Malaysia Plan (1976-80). Totalfunding for 1975-80 is estimated at M$220.7 million of which M$183.7million would be for operating expenditures and M$23.0 million fordevelopment expenditures. The Government has given its approval forthe Block Grant; however, it needs to be integrated with the Bank Proj-ect Budget.

Research Staff Salaries

31. MARDI salaries have been lower than those paid to University andRRIM personnel of equivalent training and seniority. This had placed MARDIin a poor competitive position for the best trained scientists and theInstitute has as a result lost a number of its best people. The HarunCommission salary scales were implemented in January 1975 and MARDI sal-aries are being adjusted and will be maintained at an equitable level withRRIM and the Agriculture University.

Federal-State Relationships

32. Before MARDI can carry out agricultural research in a State,agreement to this effect must be reached between the Federal and StateGovernments concerned. Such agreements have been reached for all ofPeninsular Malaysia, but as of to date MARDI does not carry out agricul-tural research in Sabah and Sarawak.

D. Agricultural Extension Services

General

33. Agricultural extension services in Malaysia are provided by anumber of organizations. The State Departments of Agriculture have primeresponsibility for extension to Malaysia's small farmers, with the excep-tion of small holders rubber growers who are catered for by the RRIM, RISDAand FELDA. The State Departments are supported in this work by the FederalAgriculture and Veterinary Departments. The newly formed Farmers Organiza-tion Authority (FOA), has the role of coordinating the extension efforts ofthe Federal and State Departments in the numerous Agricultural DevelopmentCenters it is establishing throughout West Malaysia, in conjunction withits responsibilities for farmer credit, marketing and other aspects ofagribusiness.

ANNEX 1Page 8

Federal and State Agriculture Departments Extension Services

34. The Federal Ministry of Agriculture isresponsible for supervising and organizing extension activity on Malaysia-widebasis, although funds for the State extension services come from the StateTreasuries. The chief extension officer in each State is a federal officerseconded to the State. Also the federal Department supplies a limited numberof extension specialists to individual States on the basis of particular needsand the availability of suitably qualified personnel. However, the presentstaff is totally inadequate to service the needs of the country. In January1974 there were 45 graduate officers working in extension in the eleven statesof West Malaysia. Distribution of these officers ranged from ten in the largeand relatively intensive agricultural state of Perak to only one in the smallstate of Perlis. These graduate officers are responsible mainly for admin-istration at the central State level and do little field work.

35. The organization of extension services at the district level isthe responsibility of Agricultural Assistants. There are 231 agriculturalassistants in West Malaysia ranging from two in Perlis to 52 in Perak.Many of these officers participate in some field extension work in addi-tion to their district coordination activities. The main task of on-farmextension is done by Junior Agricultural Assistant field officers, mostof whom have onlv a junior school certificate education plus some in-serv-ice training in agriculture. The total number of these in Malaysia wasabout 850 in January 1974. The very modest objective is to have one offi-cer for every 500 farm families. While this level is being approached inthe most prosperous States such as Kedah and Perak, the situation in thepoorer states of e.g., Kelantan and Trengganu, is far below the targetlevel.

36. In addition to the Federal officers working in the individualState extension services, there are seven professional officers and 24ancillary staff in the Federal extension service based at headquarters.These are responsible for providing extension information to the Stateservices and include some specialist officers who travel to the individ-ual States to advise on problems in their area of expertise.

Non-Estate Crop Extension by Other Bodies

37. Extension advice to rubber smallholders on cash crop intercrop-ping is handled by RISDA. This organization was establiphed in 1973 toassume responsibility for (i) the smallholder replanting scheme formerlyhandled by the Rubber Industry Replanting Board (RIRB) and (ii) extensionto smallholders previously handled by RRIM. The authority relys on RRIMand MARDI for data on crops and on the Department of Agriculture for guid-ance and advice on extension methods.

38. There are about 700 so-called extension officers who also servicethe replanting work. Almost 500 of these are former RIRB inspectors, withprimary school level education and no formal agricultural training. Most

ANNEX 1Page 9

of the remainder are junior high school graduates, while there are onlyabout 20 diplomates, and 10 graduate officers. Several diploma holdershave been sent overseas for degree training in extension.

39. The low level of basic education of the bulk of its officersis a serious limitation to the effectiveness of RISDA's extension services.Some assistance in training is being given by MARDI and RRIM, and upgradingof overall staff quality is being attempted through recruitment of moreagricultural diplomates university graduates.

40. The overall effect of the fragmentation of extension servicesis that, although variations exist, the effort is inadequate and the resultis inadequate. A major effort in institutional overhaul, staffing andfunding is required before adequate extension services are available tothe small farmer sector.

April, 1975

MALAYSIAAGRICULTURAL RESEARCH AND EXTENSION PROJECT

ORGANIZATIONAL STRUCTURE OF MARDI

F GOVERNING LBOARD - l

DIETR SC I EN TIF ICv<-{ X'~~~~~CUNI

* ~~~~~~~~~~~~~DEPUTY DIRECTOR I DEPUTY DIRECTOR 11l| (RESEARCH PROGRAMMES) ||(DEVELOPMENT & ADMINtSTRATION) |

ASSISTANT DIRECTOR ASSISTANT DIRECTOR ASSISTANT DIRECTOR ASSISTANT DIRECTOR ASSISTANT DIRECTOR(PRODUCTION RESEARCH) | BACKSTOPPING RESEARCH) (RESEARCH SERVICES) DEVELOPMENT ADMINISTRATION

1. Rice 1. Soil Science 1. Agricultural 1. Economics, Farm 1. PersonnelEngineering, Management

2, Oil Palm 2. Plant Science Water Management (including 2. Budgetand Central evaluation)

3. Field Crops 3. Animal Science Workshop and marketing 3. Accouints

4. Horticultural Crops 4. Crop Protection 2. Stations and 2. Statistics and 4. PurchasingFacilities Data Processing and Stores

5. Livestock 5. Central Analytical Services

3. Project Develop-6. Freshwater Fish ment and Socio-

logical Studies7. Cocoa/Coconut

4. Library, Publica-8. Agricultural Product tions and

Utilisation Printipg

5. Information and

Liaison

6. Coordination inPreparation ofAnnual Budgetsapd Implementa-tion of Develop-ment Projects

World Bank-9523(R)

MALAYSIAAGRICULTURAL RESEARCH AND EXTENSION PROJECT

FOOD TECHNOLOGY DIVISIONMINISTRY OF AGRICULTURE AND FISHERIES

ORGANIZATION CHART

| DIRECTOR GENERAL

ASSTN DIRE TOR GENERAL A

AD INS EAD TRATIS E |

|ADMINISTRATION ||DEVELOPMENT |I

_r I I

FOOD ENGINEERING. FOOD PROCESSING FOOD PRO|CESSINGDIRECTOR ~~~~~~~~PLANT ORIGIN?, IANIMAL ORJIGINI, AATI N OLT

DIRECTORF DI RECTOR CONTROL'. DIRECTOR .IIPIR llI 11

LPASIR PSTEH INFESAND . ATION AND l|AOA0- l «ILG SA ,l( | KELANTAN l OTPION HANDLING |SI t MU |TAON

CHEMICALENGINRER-FOOINS (OIL IRDATECENOLDoGI IO

F RU IS VEGETABLE

STANDARDS WORKSHOPAND

SRADDES

FRUIT AND FRUIT AND ~ ~ ~ ~ ~ ~ FOD P

STATION, STATION. AIN | SAIN l FEPIN LN

JOHORE M KANGEAR | . ~~~~~~~ ~ ~~~~~~~~~~~~~~~ ~~~~MEPGONG | FRENGOANII | T ELANTAN DPITC Nl.l,ANU|

AiNEX 1Appendix 1Page 1

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

Malaysian Agricultural Research and DevelopmentInstitute Act, 1969

An Act to establish the Malaysian Agricultural Researchand Development Institute and for matters connected there-with.

(2nd May, 1969)

BE IT ENACTED by the Duli Yang Maha Mulia Seri PadukaBaginda Yang di-Pertuan Agong with the advice and consentof the Dewan Negara and Dewan Ya'ayat in Parliament assem-bled, and by the authority of the same, as follows:

PART I

PRELIMINARY

1. This Act may be cited as the Malaysian AgriculturalResearch and Development Institute Act, 1969.2. In this Act -

"Director" and "Deputy Director" means the Directorof the Institute and any of the Deputy Directors of theInstitute appointed under sub-section (1) of section 4;

"Minister" means the 2Iinister of Agriculture andCo-operatives.

PART II

THE INSTITUTE

3. There is hereby established the Malaysian Agricul-tural Research and Development Institute hereinafterreferred to as the "Institute"1 ) whose functions shallbe -

AQif L- 1

Appenaix 1Page 2

(a) to conduct scientific, tecnnical, economicand sociological research in iHalaysia witilrespect to the production, utilisation andprocessing of all crops (except rubber),livestock and fresh water fisheries;

(b) to serve as a centre for the collection anddisseminiation of information and advice onscientific, technical and economic mattersconcerning agricultural industry, includingtaie publicationr of reports, periodicals andpapers relating thereto;

(c) to act as a centrc for specialist extensionservice in the agricultural industry;

(d) to advise on the training of workers forscientific and teclhical research and exten-sioln;

(e) to provide grants in aid for tne purpose ofpure and applied scientific, technical andeconomic research concerning agriculturalindustry; and

(f) to maintain liaison with other organizations,both public and private, indigenous andforeign which are engaged in scientific, tech-nical and economic and sociological researchconcerning the agricultural industry.

4.(1) For the purpose of tihis Act there shall be aDirector of the Institute and tw7o Deputy Directors oftLhe Institute to be appointed by the Yang di-PertuanAgong from among persons nominated by the .. inisterafter consultation with the Scientific Council as hereinafter constituted.

(2) The Director and Deputy Directors shall eachbe appointed for suchl period as may be specified inthe letter of appointrnent and slhall be eligi-le for re-appointment.

(3) The Director and Deputy Directors shall beappointed on such terms and conditions as may beprovided for in their respective letters of appoint-ment.

AiNNEX 1Appendix 1Page 3

(4) The Yang di-Pertuan Agong may at any timerevoke any appointments made under suvb-section (1);and any person so appointed may at any time resignfrom office.

(5) The Director shall be the Chief Executiveofficer of the Institute and shall be assisted by theDeputy Directors in the carrying out of his powers andduties relating to the administrative and technicalfunctions of the Institute; provided however, the Boardas hereinafter established may prescribe other powersand duties of the Director and Deputy Directors as it-thinks fit.

(6) If during any period the Director for anyreason is unable to perform the functions of his office,or, if the office of the Director falls vacant, theMinister shall appoint one Deputy Director to exercisethe powers and perform the luties of the Director untila new Director is appointed under sub-section (1).

PART IIITHE BOARD

5.(1) For the purpose of administering the Institutethere is hereby established the Malaysian AgriculturalResearch and Development Institute Governing Board (inthis Act referred as "the Board") which shall be abody corporate with perpetual succession and a common seal,and may sue and be sued in its name, and subject to andfor the purposes of this Act may enter into contractsand shall have power to acquire and hold property, moveableand immoveable, and to dispose thereof or otherwise dealtherewith.

(2) The Board shall consist of the following members-

(a) the Director of the Institute - as Chairman;

(b) a representative of the Ministry of Agricul-ture and Co-operatives - as Deputy Chairman;

(c) a representative of the Ministry of Finance;

(d) a representative of the .linistry of PrimaryIndustries;

AiNEX 1Appendix 1Page 4

(e) a representative of the Ministry of theNational and Rural Development;

(f) a representative of the Ministry of Techno-logy Research and Local Government; and

(g) not more than five members with experiencein agricultural research or agriculturaldevelopment programmes.

(3) The members of the Board shall be appointed forsuch period as may be specified in their letters of appoint-ment by the Yang di-Pertuan Agong; and every member of theBoard referred to in paragraph (g) of sub-section (2)shall, unless he sooner resigns his office or his appointmentrevoked or his office shall otherwise become vacant, beeligible for re-appointment.

6.(1) Without prejudice to sub-section (1) of section5 the Board shall have, in addition, the followingfunctions -

(a) subject to the direction of the Minister, todetermine the policies in the administrationof the Institute;

(b) to determine the procedure with respect toappointments, promotions and termination ofappointments of employees and servants ofthe Institute, exclusive of the Director andDeputy Directors;

(c) with the concurrence of the Minister, toapprove the budgets or estimates of expen-diture with respect to the administrationand operation of the Institute;

(d) to issue administrative rules relating tothe day-to-day administration of theInstitute;

(e) to determine and allocate grant in aid forresearch to be conducted by other organiza-tions or agencies; and

(f) to approve the selection of recipient ofscholarship and issue award or travel grantto be financed by the Institute.

ANNEX 1Appendix 1Page 5

(2) The Board shall by 31st March of every yearpresent to the Minister and the Minister of Finance anAnnual Report covering the activities of the Instituteincluding an income and expenditure account in respectof the preceding year.

(3) The provisions of the Schedule shall apply tothe Board.

7. The Board may from time to time appoint and employon such remuneration and upon such terms and conditions asmay be prescribed by rules, such officers, servants andconsultants as may be necessary in the opinion of the Boardfor the proper implementation of this Act.

PART IV

THE SCIENTIFIC COUNCIL

8.(1) For the purpose of ensuring maximum quality andeffectiveness of the technical programmes of the Institutethere is hereby established the Malaysian AgriculturalResearch and Development Institute Scientific Council,(hereinafter referred to as the "Scientific Council").

(2) The Scientific Council shall consist of thefollowing members appointed by the Minister-

(a) a Chairman;

(b) a representative of the Division ofAgriculture of the Ministry of Agricultureand Fisheries;

(c) a representative of the Economic PlanningUnit of the Prime Ministerts Department;

(d) a representative of the University ofMalaya;

(e) a representative of the University Kevangsaan,Malaysia;

(f) a representative of the University Sains,Malaysia;

ANNEX 1Appendix 1Page 6

(g) a representative of the University Pertanian,Malaysia;

(h) a representative of the Rubber ResearchInstitute of Malaya;

(i) not more than three persons from the agricul-tural industry;

(j) the Director - as ex-officio; and

(k) a Deputy Director - as executive secretary.

(3) (a) If owing to illness or any other causewhatsoever the chairman is unable to performhis function, the Council shall elect amongthe members an acting Chainman who shallexercise the powers and perform the duties ofthe chairman under this Act;

(b) If owing to illness or any other causewhatsoever the executive secretary is unableto perform his function, the Council shallelect among the members an acting executivesecretary who shall exercise the powers andperform the duties of the executive secretaryunder this Act.

(4) The members of the Scientific Council referredto in paragraph (i) of sub-section (2) shall be appointedfrom among agriculturists having the capacity, in theopinion of the Minister, to contribute to the due andproper functioning of the Scientific Council.

(5) Every member of the Scientific Council shall,unless he sooner resigns from his office or his appoint-ment revoked or his office otherwise becomes vacant,hold office for such period as may be specified,-in hisletter of appointment and shall be eligible for reappoint-ment.

9. Without prejudice to sub-section (1) of section8, the Scientific Council shall have, in addition, thefollowing functions -

(a) to advise on the formulation of and reviewthe research programmes of the Institute;

AiNEX 1Appendix 1Page 7

(b) to advise on priorities for the researchand development programmes of the Instituteto ensure maximum quality and effectiveness;

(c) to maintain liaison with external organiza-tions, both in the public and private sectors,and to maintain contact with agriculturalresearch needs;

(d) to furnish guidance in the development orresearch facilities including the selectionof locations and laboratory facilities andsupervision of major items of specialisedequipments;

(e) to advise on the procedures for the evaluationof capability and performance of the profes-sional staff appointed under this Act,including promotions on professional merit;

(f) to advise on the library documentationservices and publications of the Institute.

10. The Scientific Council shall meet at least fourtimes each year and shall, in addition, meet as and whenconvened by the Chairman of the Scientific Council or theExecutive Secretary.

11. A decision of the Scientific Council shall bedecided by the majority of votes of the members presentand voting.

12. Records of the proceedings of all meetings ofthe Scientific Council shall be kept by the Institute andcopies thereof shall be submitted to the Board.

13. Subject to the provisions of this Act and anyrules made thereunder, the Scientific Council may determineits own procedure.

PART V

THE FUND AND ACCOUNTS

14. For the purposes of this Act there shall beestablished the Malaysian Agricultural Research andDevelopment Fund (hereinafter referred to as the "Fund")

ANINLX 1Appendix 1Page 8

to be administered by the Board in accordance with theprovisions of this Act -

(a) into which shall be paid any special cesseswhich may be imposed or collected in accor-dance with section 20;

(b) into which shall be paid any grants made toto Institute by the Federal or any Stategovernment;

(c) into which shall be paid any monies from anysources, contributions, endowments, gifts orbequests as may be made to or in favour of theInstitute;

(d) from which shall be defrayed all expenditurerelating to the administration of the Institute,the Board and the Scientific Council and suchother expenditure as may be paid in accordancewith the provisions of this Act.

15.(1) The Board shall cause true and proper account ofthe Fund to be kept and shall, as soon as possible afterthe 31st December of each year, and not later than 30thJune, issue a report of the Fund together with a balancesheet and an account of income and expenditure during thepreceding year, calculated from the 1st January or from thedate of the inception of the Fund to the 31st December, anda list of the investment (if any) of the fund showing theircost prices and value at such last mentioned date.

(2) The annual balance sheet, income and expenditureand list of investments (if any) of the Jund shall, priorto the issue thereof, be audited by such auditor or auditorsas the Board may with the concurrence of the Minister ofFinance appoint.

16. The Board shall within three months from the closeof its financial year -

(a) transmit to the Hinister and the M4inisterof Finance each a copy of the annual accountscertified by the auditor and such accountsshall then be published in the Gazette;

ANNEX 1Appendix 1Page 9

(b) transmit to the Mlinister and the Minister ofFinance a report each by the Board on theactivities of the Institute throughout theyear and such report shall be published bythe Board.

17. The Annual Accounts and Annual Report aforesaidshall, as soon as may be, be laid before both Houses ofParliament.

PART VI

SUPPLEMENTAL

18. The Board may, subject to the approval of the Ministerof Finance, from time to time borrow or secure the payment ofany money required by it for the proper carrying out of its func-tions under this Act.

19. The assets of the Institute may be invested by theBoard in investments for the time being authorised by law forthe investment of trust fund:

Provided that the Board shall not make any investment insecurities issued or registered or other properties situatedoutside Malaysia except with the approval of the MIinister ofFinance.

20. Notwithstanding any written law relating to theimports and exports of agricultural products, the HIinister ofFinance may, for the purposes of this Act, and after consultationwith the Minister impose special cesses on such agriculturalproducts as he may think fit for the purposes of agriculturalresearch.

21. The Board shall be exempt from the payment of stampduty under any written law for the time being in force relat-ing to stamp duties.

22. No member of the Board or of the Scientific Councilshall incur any personal liability for any loans or damagecaused by any act or omission in the management or conduct ofthe affairs of the Institute, the Board of the ScientificCouncil, unless such loss or damage is occasioned by an inten-tionally wrongful act or omission on his part.

ANNEX 1

Appendix 1Page 10

23. Notwithstanding the financial source as a result ofwhich any research is carried out or any programme is under-taken in accordance with the provisions of this Act, tneresults of such research or programme shall be in the publicdomain.

24. The Minister may from time to time issue generaldirections to the Board not inconsistent with the provisionsof this Act; and the Board shall give effect to sucil direc-tions.

25. The Board may, with the approval of the Minister,and in respect of (a) and (b) subject to the concurrence ofthe Minister of Finance make rules for all or any of thethe following matters -

(a) the determination of salary scales and termsand conditions of employment of the officersand servants of the Institute, including theprovisions of loans to such officers aidservants;

(b) the establishment and management of a contri-butory provident fund for the officers andservants of the Institute or for payment ofpensions, allowances or gratuities to thesaid officers and servants on retirement orotherwise ceasing to hold office;

(c) the principles and procedures with respectto appointments, promotions and terminationof appointments in the Institute, exclusiveof the Director and Deputy Directors;

(d) the principles and procedures for the evalua-tion of capability and performance of theprofessional staff of the Institute; and

(e) any other matter which may be prescribed underthis Act.

SCHEDULE

(Section 6)

1. The Board shall meet at least four times each yearand shall, in addition, meet as and when convened by theChairman.

ANNEX 1Appendix 1Page 11

2. Four members present shall be a quorum at anymeeting of the Board.

3. Minutes shall be kept of all proceedings of theBoard and copies thereof shall be submitted to the Minister.

4. The seal of the Board shall be authenticated by theChairman, or other member acting as Chairman, and one othermember of the Board, and any document purporting to be sealedwith the said seal, authenticated as aforesaid, shall untilthe contrary is shown, be deemed to have been validly exe-cuted.

5. Subject to this Act the Board shall determine itsown procedure.

6. The Board may appoint any Committee or Committeesas it thinks fit.

7. The Board may require any person to submit informa-tion which, in the opinion of the Board is necessary for thedischarge of its functions under this Act.

April, 1975

ANNEX 1Appendix 2

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

List of Research Centers and Field Stations!/

I. MARDI Research Centers and Field Stations

1. Alor Setar - Rice & Sugarcane2. Bumbong Lima/Bertan Estate - Rice & Field Crops3. Kuala Kangsar - Fruits4. Parit - Rice5. Hilir Perak - Cocoa & Coconut6. Tanjong Karang - Rice & Field Crops7. Jalan Kebun - Pineapples & Peat Soils8. Serdang - Headquarters - Oil palm, fruits, livestock, field

crops, and vegetables9. Batu Berendam - Freshwater fish10. Kluang - Oil palm, pastures, pepper & fruits11. Alor Bukit - Pineapples12. Bukit Ridan - Fruits and Livestock13. Sungei Baging - Bris soils14. Cameron Highlands - Vegetables15. Jerangau - Oil palm, Cocoa and Fruits16. Lundang - Rice, tobacco & field crops

,II. Agricultural Products Utilization (Food Technology) Research Centers

17. Serdang - Headquarters - Processing, Engineering, Nutrition,Quality Control, Sanitation, Packaging, Chemistry, Microbiologyand General Food Technology

18. Alor Setar - Rice Processing19. Johore Bahru - Fruit and Vegetable Processing20. Kuala Trengganu - Fish Processing21. Mergong - Poultry, eggs and meat Processing22. Kuala Kangsar - Proposed Fruit and Vegetable Processing Station

1/ Refer to map at end of report.

January, 1975

ANNEX 2Page 1

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

MARDI - Research Program for Rice

A. Introduction

1. Rice is the staple food of Malaysia. While self-sufficiency inrice production is being approached, this elusive target has not yet beenreached. Almost all rice in i-lalaysia is produced by smallholders who,even within smallholders' sector, comprise the poorest segment. The riceindustry therefore warrants, on economic as well as social grounds, astrong research effort if Government policies directed at self-sufficiencyand social equity are to be attained.

2. The Northern Research Center at Bumbong Lima is nlow and will con-tinue to be the headquarters site for the Rice Research Program. This loca-tion choice was based on: (i) the presence of existing facilities and 35acres of land for effective rice research; (ii) the importance of the areafor commercial rice production, and (iii) its central location in respectto otner rice research stations at Alor Star, Lundang, Parit, Tanjong Karangand Kota Bharu (see also para 4), and the MUDA Irrigation Scheme. It is alsoconvenient in location to two major cities (Penang and Butterworth) whichhave ready communications by air, rail and paved roads and provides essen-tial services to the research staff.

3. MARDI's headquarters at Serdang will provide support for thecoordinated national rice Program in analytical, computer, and servicefunctions which would not be duplicated in the Bumbong Lima. The BumbongLima station is located close to the Bertam Estate, which has recentlybeen acquired by MARDI for field crops and additional rice research.Strengthening Bumbong Lima and staffing Bertam Estate will also be apart of the field crops research and agricultural engineering and watermanagement proposals.

4. Five other MARDI research stations are involved in rice breedingand selection, crop husbandry, plant physiology and nutrition, crop pro-tection, seed increase, water management and agricultural engineering(para 10 shows locations and functions of these stations).

P-resent Status of Rice Research

5. Current research activities of the HARDI rice researcli unit are:

ANNEX 2Page 2

(a) Selection and breeding improved high-yielding ricevarieties with early maturity, disease resistance,and improved milling and cooking qualities;

(b) Screening parental and progeny lines for resistanceto the major diseases as well as developing cropprotection practices to control diseases;

(c) Physiological studies on the growth componentsaffecting high yields i.e., the control of lodgingin rice, factors of plant spacing, water require-ment and effect of climatic factors on yield;

(d) Rice nutrition studies and trials, including fer-tilizer practices (time and method of fertilizerapplication), as they influence the growth, diseaseincidence, yield and quality of rice;

(e) Crop husbandry concerned with nursery practices,planting densities, depth of planting, age ofseedlings, plant-soil-water interactions, watermanagement, crop harvest in relation to qual-ity; and

(f) Crop protection against such diseases as bacterialleaf blight, leaf streak, blase, brown spot, andinsect pests such as hoppers and stem borers.

6. Considerable progress has been achieved in the above activities.Local and introduced rice varieties, principally from the InternationalRice Research Institute (IRRI) such as IR-8, IR-20, IR-24, from thePhilippines, C4-63 and C4-636 and RD1 and RD3 from Thailand, have beenused for hybridization. A variety, derived from CR-63 or parentage(Peta x BP1-76) produced in the Philippines has good local adaptability andwill be released for commercial planting in 1974. A glutinous line, Pulut(Setera x 1R-8) 1/ has shown promise with yields of more than 5,000 poundsper acre at several locations. This line shows excellent adaptability,desirable plant characteristics and possessing rice quality consideredexcellent for consumer acceptance. The fact that several promising linesare also in the advanced stages of testing and demonstration indicates theactivity and degree of success of the on-going rice researCh program.

7. Crop husbandry research, including work on rice nutrition andphysiology, rotational and multiple-cropping with rice, management of waterand drainage, new methods of stand establishment, weed control, harvesting,

1/ The highest yielding (glutinous) variety tested in 1972/73.

ANNEX 2Page 3

threshing and drying have been limited by manpower and equipment resources.Some investigation on direct seeding, fertilizer responsiveness, limingacid sulfate soils, time and method of nitrogen application, nitrogen spacingtrials and water management have been conducted but this research is not veryfar advanced. The inclusion in the project of a Agricultural Engineeringand Water Management Research Program will strengthen work on these problems.

8. Double-cropping or rotation-cropping of rice has become a realityin several large areas of West Malaysia due to improved irrigation, drainageand water control. This provides a highly practical means of crop diversi-fication not heretofore available in Malaysia. Multiple-cropping involvingrice fully utilize the land and water resources. A whole new technologyinvolving rotational and multiple-cropping, methods of land preparation,stand establishment, fertilization, water management, pest control, har-vesting, threshing and drying the paddy is required to utilize fully theland and water resources. It is expected that this will become a majoractivity in close collaboration with the Agricultural Engineering andWater Management Research Program.

B. The Research Program on Rice

9. The Project would strengthen the Rice Research Program as awhole and the Headquarters Research Center at Bumbong Lima in particular.The research at this center would emphasize production-oriented research onrice, crop rotations and multi-cropping. The rice research program wouldcontinue the use of existing MARDI research stations to complement researchat the central facility and provide a variety of agroclimes for adaptivetesting.

10. The principal research sites involved in the program and theirrespective functions will be as follows:

Locality Function

Rice Research Center 1. Central coordination for national multi-Bumbong Lima disciplinary rice research program.

2. Multi-disciplinary staff headquartersfor production-oriented rice research.

3. Land, greenhouses, laboratories andsupporting research facilities.

4. Information and training center forresearch, extension and developmentstaff and agencies.

ANNEX 2Page 4

Field Research Stations

Tanjong Karang 1. Adaptive trials of promisingvarieties.

Parit 2. Seed increase for fundation stocks

Lundang 3. Field trials on crop husbandry asaffected by soil type and agro-climatic conditions.

Alor Star 4. Paddy mechanization, including fieldpreparation, planting, fertilization,pest control, harvesting and drying.

Kota Bharu 5. Paddy mechanization, including field'preparation, planting, fertilization,pest control, harvesting and drying.

6. Water and drainage investigations.

7. Multi-cropping - rotation research.

8. Regional extension activitiesappropriately coordinated withnational and state agencies.

ll. The main focus of rice research would be on:

(a) Breeding and selection for high yield plant type,disease and pest resistence, non-photoperiod sensi-tivity and short maturation.

(b) Breeding and selection for improved quality, in-cluding grain length, translucence, vitreous appear-ance without chalkiness, medium amylase content andgelatinization temperature.

(c) Crop physiology studies designed to assist the plantbreeder in the identification of plant types for highyield, the physiology and identification of factorscontrolling yield, spacing x variety x fertilizerinteractions, seedling quality and performance, sea-sonal and environmental effects on crop growth andyield.

(d) Fertilizer rate and application studies designed toidentify the nutritional requirements or rice on

ANNEX 2Page 5

typical paddy soils, the effect of time and methodof application; acid sulfate amelioration for paddyproduction, and the correlation of soil and planttissue tests with crop response to fertilizer.

(e) Crop husbandry, especially nursery preparation, plantspacing, soil-plant-water relations, alternative methodsof stand establishment, weed and pest control, waterrequirements and water management.

(f) Crop protection, involving cooperation with agricul-tural engineers and with plant breeders in screeningfor resistance to the major diseases, such as bacte-rial leaf blight, bacterial leaf streak, blast, brownspot, sheath blight stem borer, leafhopper; develop-ment of screening techniques; disease etiology, host-parasite relationships, crop losses and evaluation ofchemical control methods.

(g) Rotational and multiple-cropping patterns for dif-ferent rice soils where water supplies and drainagecan be controlled. Identification of upland fieldand vegetable crops which can be grown in rotationor in multi-cropping with rice. This work involvesstudies of managing puddled rice soils in cooperationwith agricultural engineering and water management.Rotational cropping work done in collaboration withthe field crop unit.

(h) Rodent control in cultivated paddy fields and in ricestorage to eliminate plant damage and crop loss.

(i) Studies of the economics of paddy production and var-ious husbandry practices; evaluation of multiple-crop-ping systems.

(j) Accumulation, preparation and dissemination of riceproduction subject matter to Federal, State and otheragencies concerned with the production of rice.

C. Local Staff

12. Under the Project MARDI would expand the number of graduatestaff engaged in the research from the present 17 to 32. This would involve.erticularly strengthening staff for the crop husbandry, plant nutrition,disease and pest resistance and control work, so that the new varietiescoming from the breeding program could receive adequate evaluation and bebrought quickly into practical use. The expanded team would also place

ANNEX 2Page 6

increased emphasis on multiple and rotation cropping and would collaborateclosely in these studies with the Field Crops Program.

D. Internationally Recruited Scientists

13. It is proposed that the Project provide 14 man years of expatriatescientists to work with MARDI staff. A senior scientist with experience inrice breeding or rice agronomy would be recruited for five man years toassist in planning and developing the Program. Scientists to work on weedcontrol, and crop rotation would each be recruited for three years. Theywould also make their experience available to assist the Field Crops Program.In addition, three man years would be provided for short term assignments tocover specific problems arising during the course of research; this wouldalso include a contribution to the cost of funding the Program SpecialistPost assigned to the Deputy Director for Research Programs. The detailsof costs shown in Table 2.1 indicate an expenditure of $840,000 for theseexpatriate scientists. The Project would also seek to strengthen linkagewith the International Rice Research Institute (IRRI) for both technicalassistance and training.

E. Fellowship and Training

14. Post graduate training for staff would be an important part ofthe Project. It is proposed to allocate 43 man years of post graduatetraining time to the Rice Program - this would be sufficient to train eightstaff to PhD level and another eight to MSc level. In addition three manyears would be allocated for short term training fellowships at leading riceresearch institutions. The cost details shown in Table 2.1 indicate an ex-penditure of some $619,200 for these fellowships during the 6 year projectperiod.

F. Land, Buildings, Equipment and Materials

Land and Buildings

15. Existing MARDI stations provide all the land required for theresearch program, but some additional laboratory buildings will be neededat Bumbong Lima, and at the experimental stations at Alor Setar, in Kedahand Palundang in Kelantan.

Equipment and Materials

16. Field, farm and laboratory equipment; together with consumables forresearch work (such as chemicals and glassware), fertilizers and pesticideswould be provided under the Project. The total expenditure for these itemswould be US$569,000 including buildings during the 6 year project period.

ANNEX 2Page 7

G. Organization and Management

17. The Rice Research Program will be led by a Senior Scientist (Pro-gram Coordinator), under the supervision of the Assistant Director for Pro-duction Research.

18. There will be a particular need for close collaboration with theother Programs in MARDI. The desirable contact and collaboration would befacilitated by the establishment of Research Committees and would be aug-mented by the Program Specialist.

19. It is important that effective collaboration be established betweenthe MARDI rice research program and all irrigation schemes, such as MUDA. Atpresent MUDA personnel lack appreciation of the contribution which M4ARDI re-search can make to improving rice yields and solving some of the long termproblems facing in this major rice growing area, Closer consultation betweenMARDI and the MUDA personnel could help to define the nature and extent ofproblems, and to focus MARDI's work on the most important problems.

20. The internationally recruited experts working in the rice programwould be able to make a valuable contribution to the planning and developmentof the expanded activities. They will pursue active research programs andnot act solely as advisors. This is important because the research strengthof the Program would be considerably reduced by the absence of MARDI staffon post-graduate training.

R. Cost Estimates

21. Estimates of costs for all goods and services for the Rice ResearchProgram are shown in Table 2.1.

April, 1975

MALAYSIA

AGRICULCURAL RESEARCH AND EXTENSION PROJECT

RICE RESEARCH PROGRAM

Cost Estimates - US$ c 1000 Equivalent

TEHS Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Years I - 6

Loana Forelgn Local ForEigo Local ForeEgn Loac, Foreign Local F.reiga Local Foreign Local Foreign Total

I - SERVICES

1. ESpotriate Specialiata

Senior Plantbreeder/Agrono-mit, 5 MY 9.0 51.0 9.0 51.0 9.0 51.0 9.0 51.0 9.0 51.0 45.0 255.0 300.0Crop Husbandry Specialist, 3 MY 9.0 51.0 9.0 51.0 9.0 51.0 45.0 153.0 300.0Cropping Systems Spcislist, 3 MY 9.0 51.0 9.0 51.0 27.0 153.0 190.0Shortterm Consultanciet, 3 19Y 4.5 25.5 4.5 25.5 4.5 25 5 4.5 25.5 4.5 25.5 4.5 25.5 27.0 153.0 10.0

2. Fellowshipa

Staff Fellowahipa, 43 MY 0 103.2 0 103.2 0 103.2 0 103.2 0 103.2 0 103.2 0 619.2 619.2

Subtotal I - ISRVICES 31.5 281.7 31.5 291.7 31.5 281.7 13.5 179.7 13.5 179.7 4.5 129.7 126.0 1333.2 1459.2

II - GGODS

S. iuildings

Nuhbo!lg Lipa

Inaect Proof Hoona (3) Insectory (1)Animal ilous (1) 16.2 8.1 16.2 8.1 32.4 16.2 48.6Plant hou.e (9) 36.7 18.3 36.8 18.4 73.5 36.7 110.2Eateneion of eoiuting laboratory 12.8 6.4 12.8 6.4 25.6 12.8 38.4

Alor Star

Regional Laboratory 7.1 3.5 7.2 3.6 14.3 7.1 21.4

Palandana

Regional Laboratory 7.1 3.5 7.2 3.6 14.3 7.1 21.4In-set Proof Hou.e 4.3 2.1 4.3 2.2 8.6 4.3 12.9Plant Ho.s. (1) Plant House forPhotoperiodir studies (1) 6.8 3,4 6.8 3.4 13.6 6.8 20.4

2- Fertfli.etu

Urea, 240 tlons @ $ 700/trn 1.1 11.4 1.1 11.4 1.1 11.4 1.1 11.4 1.1 11.4 1.1 11.4 6.6 68.4 75.0Phoaphate, 48 tons @ MS 500/tan 0.2 1.6 0.2 1.6 0.2 1.6 0.2 1.6 0.2 1.6 0.2 1.6 1.2 9.6 10.8Potash, 30 tone @ MS 400/ton 0.1 0.8 0.1 0.8 0.1 18. 0.1 0.8 0.1 0.8 0.1 r0.8 0.6 4.8 5.4Miscollnaneoa p-sticidec, ehemicala 0 1.0 0 1.0 0 1.0 Ge. 7 .o 0 1.0 t . 1.0 0 6.0 6.0

3. Resean.h Equipnent

Rice Program

Rire Separator and sorter (1) 0 10.2 ° 10.2 10.2Elect-onic grain ce.nter (1)res.each siscroscope (1) pearler (1)spectrophotoomter (1) ge,,inantngcabinet (1) debhuidifier (1)precision balance (1) 0 6.3 0 6.3 0 12.6 12.6Other roaearch and laboratcry eqaipmset 0 17.6 17.6 0 35.2 35.2

shemi-cal, glaseware, cosua,blea 0 8.1 0 8.1 0 8.1 0 8.1 0 8.1 0 8.1 0 48.6 48.6

Crop Yrotection Psoeran

Growth chaster with humidtty control 0 8.1 0 8.1 8.1Wnteestill (3) .centr1fge (1) Colonycounter (1) colourimeter (2)lighttrap with as.c.Ei pump (2) micra-manipulator (net) 0 O 15.0 0 o 15.0 15.0Other laboratory and reeareb eqauipsent 0 12.5 0 12.5 12.5Reaearbh microacopes (3) Zoomateneoncoprn and accesaoriea 0 8.0 0 9.0 8.0Chemicols, glasawara, consua. blea 0 8.1 0 8.1 0 8.1 0 8.1 0 8.1 0 8,1 0 48.6 48.6

Subtotal 11 - GOOD 92.4 154.0 92.7 100.6 1.4 31.0 1.4 31.0 1.4 31.0 1.4 31.0 190.7 378.6 569.3

RICE RESEARGH PROGRAM - TOTAL 123.9 435.7 124.2 382.3 32.9 312.7 14.9 210.7 14.9 210.7 1.9 119.7 316.7 1311.8 2028.5

Aptil 3, 1975

ANNEX 3Page 1

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

MARDI - Research Program for Field Crops

A. Introduction

1. GOM has emphasized the development of field crops (other than rice)as a major priority in the agricultural sector. Although these field crops,except cassava and groundnuts, are now of minor importance in Malaysian agri-cultural production, their products form a substantial proportion of importsalready, and internal demand is steadily rising, especially for livestockfeeds. In this context principal crops warranting research are soybeans andcertain other feed legumes, cassava, maize and sorghum. Although most ofthese crops are grown in Malaysia, yields are low and there is a need forresearch on improved varieties and cultural methods. In particular, studiesare needed for cultivation of these crops under Maylsian small farmer condi-tions.

2. It has been decided to explore the prospects for large-scale pro-duction of these crops through research and development by the creation ofa Research Program in Field Crops to be headquartered on the new NorthernResearch Center at Bertam, close to the existing well-developed rice researchcenter at Bumbong Lima.

3. Bertam requires extensive development before it can be used forfield crops research. Until this development is sufficiently advanced,MARDI's headquarters station at Serdang would continue to serve as thefield crops research center. A number of research field stations wouldbe required to cover the major agroclimatic and soils regions of Malaysia.After the main base for the Program is transferred to Bertam, the stationswhich would be used as field trial stations are:

(a) Jalan Kebun - peat soils of the west coast

(b) Serdang - rolling upland soils of the west central area

(c) Kota Bharu - alluvial soils of the north-east coast

(d) Two or three other stations in eastern and southernPeninsular Malaysia.

ANNEX 3Page 2

Also, because maize and sorghum are normally grown in much drier climates thanthose of West Malaysia, consideration must be given to testing these materialsin Sabah where some areas are drier than West Malaysia.

Status of Research and Knowledge

4. Agro-climatically, considerable areas of Malaysia appear to be suitedto the production of field crops. Climatic problems with field crops aremore likely to be associated with excessively wet and humid conditions thanwith dry weather - e.g., problems of land preparation, erosion, fungal disease,and grain harvesting.

5. Soils in Malaysia range from heavy clay alluvium to coarse sand intexture, and have varying capacities to supply nutrients. It is likely thata considerable amount of applied nitrogen will be needed in most soils inorder to obtain acceptable yields of non-leguminous crops. Since legumescan build up nitrogen levels in the soil for the benefit of subsequent crops,the economic value of legumes is accentuated by the recent large rise inthe cost of nitrogen fertilizer, and the likelihood of supply shortages.Phosphorus is almost universally required for good crop growth, lime may beneeded on the more acid soils, and certain minor elements will probably berequired on some soils (e.g. copper on peat soils). Soil fertility researchwill be needed to establish crop fertilizer needs in the various soil-climateenvironments.

6. Apart from cassava and groundnuts, field crops to be studied arevirtually untried in the Malaysian environment and any research program istherefore of an exploratory nature. This places major emphasis in the earlystages of research on assembling ecotypes for testing in Malaysia, with par-ticular attention to collecting and evaluating material from other humid-nearequatorial regions.

7. Little information is available on varietal performance and fertilizerresponse of maize in Malaysia. The principal variety presently being grownis a "local flint" of unknown origin with a low yield potential (around 2,000lbs/acre). The syntehtic variety "Metro" was introduced some 10 years ago fromIndonesia, and has yielded up to 6,000 lbs/acre albeit under favorable con-ditions. A recent study (Wong, 1973) indicated that "Metro" as now grown inMalaysia is highly variable in performance and should be reselected to increaseyield. Fertilizer trials in Trengganu State (Lim, 1973) showed response tolime, nitrogen and phosphate but not to potassium. Yields of "Metro" in thesetrials exceeded 4,000 lbs/acre on the best soils but were on the order of2,000 - 2,500 lbs/acre on a heavier soil series. Some trials of hybrids andvarieties from South Africa, Australia and India were attempted a few years ago,with one Australian hybrid showing good performance. Very recently, a largecollection of "tropical" varieties and hybrids was provided to MARDI by a com-mercial starch processing company, and this material is being evaluated atSerdang.

ANNEX 3Page 3

8. Maize research in many other countries has progressed to a very highdegree in the past 30 years. High-yielding selections and hybrids now areavailable in most of the major maize-producing countries of the world, althoughplant breeding success has been less marked in tropical areas than in tem-perate zone countries. Some high-yielding commercial hybrids are being grownin equatorial America, but it is not known how well this material wouldthrive in Malaysia. -

9. Sorghum has recently been introduced to Malaysia, and has givenhigher yields than maize. The most promising type is a medium-height hybridintroduced from India. Yields of over 4,000 lbs/acre have been obtained inseveral trials, including rotational trials on coastal peat soils at MARDI'sJalan Kebun station. Sorghum responds to nitrogen and phosphate' applications,and copper is required for it to develop properly on the peat soils. No plantbreeding work has been done with sorghum in Malaysia, and the eventual placeof the crop in Malaysian agriculture has yet to be determined.

10. Breeding techniques employed for sorghum in the United States, Europe,Argentina, Brazil and India depend chiefly on the production of hybrids.Yields up to 8,000 lbs/acre have been produced, but the adaptation of thattype of material, particularly its peformance under wet and humid equatorialcondition, is not known. Generally, sorghums require a substantial periodof dry weather for proper grain maturity, and are often subject to severedamage by birds.

11. Although only limited work has been done in Malaysia with soybeans,plot yields of up to 2,500 lbs/acre have been obtained in field trials by theRRIM. Some material has recently been obtained by MARDI from the InternationalSoybean Research Program (INTSOY) at Illinois. The need for adequate Rhizobiuminoculation hs been demonstrated (Rajaratnam, 1973), but commercial culturesof Rhizobium are not presently available.

12. In recent studies with soybeans in Nigeria and Ecuador, yields ex-ceeding 3,500 lbs/acre have been attained with some varieties, EffectiveRhizobium inoculation, ample supply of available phosphorus, and high plantpopulations were required for high yields in these areas.

13. Little research has been conducted in Malaysia on tihe otner foodlegume species - groundnuts, mungbeans, and cowpeas. MARDI's research workersare aware of the international research linkages available for development ofstudies in these species (ICRISAT - India for groundnuts, IITA - Nigeria forcowpeas, and AVDRC - Taiwan for mungbeans).

14. Malaysia has conducted research on cassava for some time, and MARDIcould rapidly develop its research on this crop. Internat-:onal linkages arepossible with CIAT (Colombia) and the Central Research Ins Litute of Agriculture(Indonesia) where significant research on cassava is underway.

ANNEX 3Page 4

B. The Research Program on Field Crops

Description

15. The following group of field crops, whose products are used inMalaysia for human and animal food would form the core of the field cropresearch program:

(a) Grain legumes - groundnuts, soybeans, mungbeansand cowpeas, and other grain legumes.

(b) Root crops - cassava (tapioca), and other rootcrops; and

(c) Coarse grains - maize and sotghum.

16. Under the Project, MARDI would undertake research on all thesecrops in a Field Crops Research Program, with appropriate sub-units forindividual crops or groups of crops. The Program would involve an inter-disciplinary research team based at the Bertam Station. Other field stationsof MARDI would also be utilized for field research and trials of these cropsin the major agro-climatic areas where there are good prospects of theirsuccessful use. Emphasis would be placed on grain legumes.

Research Program - General Review

17. The major initial objective of the program would be to establishthe broadest germplasm base through plant introduction and to determinecultural requirements for the most profitable yields of soybean, groundnuts,other food legumes, cassava, other root crops, maize and sorghum underMalaysian conditions. It is most likely that germplasm and production tech-niques to achieve high yields in all of these crops are available from otherareas of the tropical world, but require evaluation and probably modificationto fit Malaysian agricultural conditions.

18. The Program would concentrate on the development of crop varietiesand production techniques capable of high and sustained yields under Malaysiafield conditions. This will involve attention to yield, maturity, productquality, resistance to disease and insect attack and tolerance to climatichazards. Promising introductions or varietal selections would be multipliedand tested in coordinated trials at the headquarters and branch field sta-tions. They would be evaluated for yield, nutrient response, maturity,adaptability to cropping systems, and resistance to diseases, insects, mam-malian pests (particularly rodents) and environmental hazards. Since theintroduction of several of these crops in the Malaysian environment isexploratory, a major effort in plant breeding would not be justified untila representative range of introduction had been properly evaluated and plant

ANNEX 3Page 5

breeding objectives could be defined. This is particularly true of maize,sorghum, and of grain legumes such as cowpeas, mung beans and pigeon peaswhich are mainly grown in the high latitude tropics and sub-tropics in muchlower rainfall conditions than in Malaysia.

Specific Crop Programs

I. Food Legumes - Soybeans

19. Selection and Improvement. Early improvement work would concen-trate on the introduction and testing of established varieties and advancedgeneration germplasm pools expected to have tropical adaptation. The inter-national agencies INTSOY - (University of Illinois), IITA (Nigeria) andAVRDC (Taiwan) are possible sources of such material. Other potential sourcesare the University of Queensland (Australia), the Brazilian National SoybeanProject, the USDA-ARS soybean group at Stoneville, Mississippi. However, themajority of this material does not come from wet near-equatorial regions, andthe collection of soybean ecotypes from those regions should feature inMARDI's plant exploration program. Once promising material has been selectedor bred it would be multiplied and distributed for verification trials andfarm use. Because of the humid climate, selection for disease resistancewould be particularly important.

Other Food Legumes (Groundnuts, Mungbeans, Cowpeas)

20. Selection and Improvement. Breeding systems for these three speciesare essentially similar to those for soybeans.

21. Agronomic Practices: Except for groundnuts, there is little expe-rience in Malaysia with growing food legumes. Thus, the basic agronomicpractices best suited to the production of high yields under local conditionsmust be established. These studies would include time and methods of sowing,row spacings, plant populations, cultural practices, rotational sequences,and intercropping. The program would also include studies at high plantpopulations of 150,000 plants or more per acre.

22. Soil Fertility and Plant Nutrition: Studies of crop responseto various fertilizer treatments, on different soil types, would be the majorobject of this research. Nitrogen fertilizer application would be confinedto limit amounts of "starter" nitrogen provided that effective Rhizobiuminoculation is applied. Requirements for phosphorus are usually substantial,and minor elements may be a problem on some soils. Soil PH studies andpractical means for correcting soil acidity would be investigated.

23. Rhizobium Inoculation Studies: These studies would be an essentialpart of the food legume program, since little work has been done to date inMal,ysia. These studies would be of an applied nature and include experimentsdesigned to determine the need for inoculation, the success of differentinoculum strains in the field, inoculation techniques and inoculant prepara-tion and control.

ANNEX 3Page 6

24. Disease, Insect and Weed Control: Virus diseases are the mostimportant problem of grain legumes in most tropical and subtropical areas,and their identification and control would be a primary objective in thisprogram. Most of the major virus diseases are insect-vector transmitted,and close collaboration between plant pathology and entomology is required.Low resistance in existing germ plams is a problem, but major screeningefforts are underway at several tropical and subtropical research centers(G. B. Pant University, India; IITA, Nigeria; Port Alegre, Brazil). Weedcontrol, using herbicides and cultivation, would also be studied particularlywith food legumes. In this work it would be essential to consider theeffects on erosion of any cultivation undertaken for weed control. Resist-ance to fungal diseases would also be considered in the selection andbreeding program, since many food legumes have marked susceptibility tofungal diseases under humid conditions.

II. Root Crops

Cassava

25. Selection and Improvement: Cassava has been cultivated in Malay-sia for many years, and at present occupies the largest acreage of any ofthe field crops proposed for study under the Project. It is already thebasis of a substantial export industry as well as being an important foodstaple in Malaysian diets. The crop is well adapted to the environmentand produces high yields of carbohydrates, and would receive priority inthe field crops research. Only a few varieties are extensively planted,although many are known in the country. As a first step, all recognizablevarieties found in Malaysia would be collected and established at the centralresearch site. Promising introductions from Indonesia, Thailand, Brazil andCIAT (Columbia) would also be obtained. The existing status and promise ofthe crop justify special attention to it in MARDI's plant collecting activities.After preliminary screening for root yield and other desirable characteristics,the best types would be multiplied for further testing and distribution.Crossing between desirable types would be undertaken with the aim of developingsuperior varieties.

26. Agronomic Practices: Trials would be conducted on plantingtechniques, plant population and spacing, time and methods of harvesting,and cropping sequences (including intercropping). These trials wouldinvolve selected varieties and be conducted at locations representing themajor soil situations where cassava is likely to be grown.

27. Soil Fertility and Plant Nutrition: Cassava is a root crop witha long growing period, and differs greatly from grain crops which have muchshorter growing periods. It is therefore likely to exhibit different responsesto soil nutrient supply. Plant nutrition studies should seek to determine

ANNEX 3Page 7

the quantity of nutrients removed by the crop, fertilizer response on differentsoils, including times and rates of application, varietal differences infertilizer response, and appropriate indicators of nutrient deficiency.

28. Diseases and Pest Control: Cassava is considered to be relativelyfree from serious disease and pest attack. However, plant diseases area problem in some areas, and research would be required to determine ifmore intensive cultivation of cassava, or changes brought about by plantbreeding, are likely to lead to increased disease or pest hazards.

III. Coarse Grains

Maize

29. Under the Project collection of maize varieties and ecotypes from.overseas would be made, concentrating Gn near-equatorial, high rainfalllocalities. Only after all this material had been thoroughly appraisedwould a decision be taken on the breeding material and breeding system tobe selected. Because of the technical difficulties with hybrids, they wouldneed to show large potential advantages to justify a decision in their favour.Constraints on plant and grain type should not be brought into the programtoo early, as they may introduce unwarranted yield limitations.

30. Agronomic Practices: A thorough review would be made of the bestavailable agronomic practices for production of high maize yields undertropical conditions. Following this review, field work would be concentratedon the major soil types and rainfall zones of Malaysia, to determine themost appropriate practices for cultivation, planting time, seeding rates,spacing, crop sequence and timing of harvest. For these agronomic studies,selections with high yield potential would be used, together with appropriatecrop protection and fertilizer regimes.

31. Soil Fertility and Plant Nutrition: Research on soil fertility andplant nutrition would concentrate on fertility requirements for the besteconomic yields on specific soil types and cropping patterns under Malaysianconditions. Other nutrient elements and lime may be required, especially on"iproblem" soils such as peats or sandy loams. Fertility research would beconducted in association with agronomic and varietal studies, to ensurethat the findings are applicable to Malaysian farming conditions.

32. Disease, Insect, Pest and Weed Control: Maize in the tropics issubject to several serious disease and insect pests, and in some instancesto mammalian pest damage. Also weeds can be a serious problem, especiallyin the young crop stages. In the proposed program diseases associated withhumid conditions such as mildew and stalk rot may present special difficulties,while stalk borers are already known to be a problem.

ANNEX 3Page 8

Sorghum

33. Selection and Improvement: Most of the recent research in sorghumbreeding and production techniques has been done in the USA. Some applicationof this work to tropical environments has been undertaken in India and a fewother countries, but much of this work has been in areas much drier thanthose where the crop would be grown in Malaysia. While sufficient researchevidence is available to indicate that this crop can produce high yieldsunder a wide range of environmental conditions, there is little informationon the crop in the wet equatorial tropics.

34. Selection and Improvement: No material selected for Malaysianconditions is available. The introduction of sorghum ecotypes from similarclimatic areas would be an important aspect of MARDI's plant explorationwork.

35. Agronomic Practices, Soil Fertility and Nutrition. The objectiveof research on cultural practices would be similar to those for maize, withthe addition of trials on ratooning.

36. Disease, Insect and Pest Control. Except for stalk borers anddowny mildew, the range of disease, insect and other pests affecting sorghumdiffers from those attacking maize. Leaf diseases and fungal attack onmaturing heads may be a problem in humid conditions. Bird damage to theripening grain is particularly severe when isolated fields of sorghum aregrown, and is much more serious in short-glumed, white or yellow seeded types.Resistance to loss from these pests and diseases would be important objectivesin any breeding program.

Seed Production, Processing and Storage

37. A program for the multiplication of seed of new cultivars offield crops selected in the evaluation and breeding programs would be apart of the Project. The creation of a seeds sub-unit would ensure thatthis important activity receive proper attention. Studies would also includetime of sowing in relation to seasonal conditions, maintenance of purity, andthe most effective agronomic practices to ensure high yields of good qualityseed. The sub-unit would also be responsible for evaluating and prescribingtechniques for seed handling, processing and storage under local conditions.

Collaborative Activities

38. Because several of these crops are virtually untried in Malaysia,there is a particular opportunity for the Field Crops Program to profit bycollaborative activity both inside and outside the Institute. This collabora-tion would be essential both to developing efficient crop production systemsand to establishing profitable farming activity based on the new technology.

ANNEX 3Page 9

39. Plant Collection Introduction and Exchange. MARDI workers arealready in contact with a number of the overseas centres mentioned in theprevious sections viz.

Maize - CIMMYT (Mexico)Soybeans - INTSOY (Illinois, U.S.A.)Cowpeas - IITA (Nigeria)Sorghum and Groundnuts - INCRISAT (India)Mungbeans - AVRDC (Taiwan)Cassava - CIAT (Colombia)

Other relevant overseas agencies include the national maize, sorghum andsoybean programs of the USDA (United States), maize and sorghum research ofseveral European countries, and the national soybean research program ofBrazil.

40. Reference has been made to the need for MARDI staff to make specificcollections of all the principal crops to be studied by the Field CropsResearch Program, the Coconut Research Program (Annex 5) and the PineappleResearch Program (Annex 4). The Project would finance a limited number of2-3 man collecting missions to selected near-equatorial regions. The missionswould obtain major collections of material which would be the basis forselecting and breeding varieties adaptable for use in Malaysia. The collectionswould concentrate on the food legumes (soybeans, groundnuts, and possibly alsocowpeas, pigeon peas, and mung beans), cassava, pineapple, maize and sorghum.

41. Field losses of farm produce have always been a serious problemand are further complicated by multiple cropping and resulting wet seasonharvest. Thus improvement in post-harvest technology handling, drying,storage and processing, are becoming increasingly important. Research inthis is essential and would be carried out by the Agricultural Engineeringand Water Management Program in close collaboration with the Field Cropsand Agricultural Products Utilization Programs.

Staffing

42. The present Field Crops Research Program would require major expan-sion to handle the program described above. During the Project, the Programwould need to build up its graduate staff from the present total of 11 to 38graduate scientists.

43. It is estimated that 22 man-years of expatriate scientists timewould be needed during the formative stages of MARDI's expanded Field CropsResearch Program. One senior scientist with extensive experiece in tropicalupland crop agronomy, preferably with food legume experience, would assist theProgram Coordinator in planning and coordinating the work. He would also-nerate his own research program. Two other expatriate agronomists wouldbe needed for the cassava and maize and sorghum research programs and the

ANNEX 3Page 10

Rhizobium research program. Two other internationally recruited scientists,one for weed control and the other for multiple cropping with rice would beshared with the Rice Research Program. The Project would also provide for9 man-years of short-term consultances time to assist in specific aspectsof the Program as it develops and contribute to the cost of the ProgramSpecialist assigned to the Deputy Director for Research Programs. Thetotal cost for the Project of internationally recruited sepcialists wouldbe US$1,320. Details are provided in Table 3.1. The costs of the plantcollection missions are estimated at $54,000.

Training and Fellowships

44. Further training of staff would be vital to the successful devel-opment of the proposed expanded Program. Of the five graduate MARDI staffworking on field crops at present, only one has a post-graduate degree.Furthermore, it is unlikely that any of local staff to be recruited to theteam would have had post-graduate training. The Project would providesuitable research officers assigned to the field crops program with over-seas postgraduate training. Wherever possible, overseas training programswould include provision for research on problems relevant to Malaysian agri-culture. Arrangements for such training with course work at overseas insti-tutions and field work in Malaysia are currently being negotiated. Adaptiveresearch training at such international centers as CI MYT, AVRDC, IITA,ICRISAT, and CIAT under short-term fellowships would also be included.

Land Buildings, Equipment and Materials

45. The proposed main field crop research center at Bertam hias onlyrecently been purchased by MARDI and requires land clearing, drainage, someland levelling, the provision of irrigation facilities, and the constructionof office and research buildings. Total expenditures for land buildings andmaterials would be approximately US$900,000 during the project.

Cost Estimates

46. The estimated cost of all goods and services which would be fi-nanced for the Field Crops Research Program is shown in Table 3.1.

April, 1975

MALtYS LA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

FIELD CROPS RESEARCH PROGRAM

Cost Eutisates - USS 1000 En-ivaleet

ITEMS Year I Year 2 Year 3 Year 4 Year 5 Year 6 Year, I - 6

Local Foreign Local Foreign Local Foreign Local Foreign Local Foreig, Local Foreign Loc-l Foreign Total

1 SERVICES

Senior Scientist, 5 MY 9.0 51.0 9.0 51.0 9.0 51.0 9.0 51.0 9.0 51.0 45.0 255.0 300.0

Meize-Sorghum Agronomist, 4 MY 9.0 51.0 9.0 51.0 9.0 51.O 9.0 Sl.O 36.0 204.0 240.0

Rhizobe. Specialist, 4 MY 9,0 51.0 9.0 51.0 9.0 51.0 9.0 51.0 36.0 204.0 240.0

Other and Shsrttern Coneultanta, 9 MY 13.5 76.5 13.5 76.5 135.5 5 13A I6.s 13.5 76.5 13.5 76.5 81.0 459.0 540.0

lullossuhip., 54 MY 0 129.6 0 12%46

0 129.6 0 129.6 0 129.6 0 129.6 0 777.6 777.6

Support for Plent Collection Mi.aion in

Africa end South America 0 9.0 0 9.0 0 9.0 0 9.0 0 9.0 0 9,0 0 54,0 54.0

Subtotal I - Servicea 40.5 368.1 40.5 368.1 40.5 368.1 40.5 368.1 22.5 266.1 13.5 215.1 196.0 1953.6 2151.6

11 GOODS

1. Buildings

Bertree

Lhbor-tory 13.0 5.5 13.0 5.5 26.0 11.0 37.0

Steres; Fertiliser, Seed,P.O.L.,Eq.ip.ent 12.7 5.4 12.8 5.4 25.5 10.8 36.3

Shops; Workshop, I.pIee..t.,Postherve-t work 10.2 4.4 10.2 4.4 20.4 8.8 29.7

Staff qo-rtere 1.7 0.7 1.7 0.7 3.4 1.4 4.8

Field Labohrtory 2.6 1,1 2.6 1.1 5.2 2.2 7.4

Shadeheuse for Rhi-bo-o Research(Serd.ng) 5.6 2.3 5.6 2.3 11.2 4.6 15.8

Other building. .5.9 2.6 5.9 2.6 11.8 5.7 17.0

2. . Farn Deve lopent

Land clearing 5.5 1.4 5.5 1.4 5.5 1.4 5.5 1.4 5.5 1.4 27.5 7.0 34.5

Sprinkler irrigation (Bertran) 0 11.6 0 11.6 0 23.2 23.2

3. Far Eqsip.ent

Meize planters (4) Forklift truck (1)

Cohbine (1) Forage harvester (1) 0 17,0 ° 17.0 0 34.0 34.0

Tractors; 45 HF(2,)75 HP (3) D 8.7 14.8 0 6.1 0 6.1 0 35.7 35.7

Trnetori.npleoentu 0 12.7 12.8 0 25.5 25.5

Single exle Tractor (2) 0 3.8 0 3.8 3.8

Fumps (9) 1.9 0 1.9 0 1.9 0 1.9 0 1.9 0 1.9 0 11.4 11.4

Motorgrader (1) 0 41.6 0 41.6 41.6

Roadr-ller large (1), small (1) 0 40.8 0 40.8 6.0.8

Mticellaneous feru equipment 0 3.6 0 3.6 0 3.6 0 3.6 . 0 3.6 0 3.6 0 21.6 21.6

Spare partn, 157. 0 19.5 0 7.6 0 1.7 0 0.1 0 0.1 0 1.7 0 30.7 30.7

4. Fertilteers

Urea@ M$ 700/ton 0.9 8.7 1.2 12.0 1.4 13.6 1.6 16.0 1.6 16.0 1.6 16.0 8.3 82.3 90.6

ph-sphste@ 1M 500S/to 0.1 1.2 0.2 2.0 0.2 .5.5 D.53 2.8 0.3 2.9 0.3 2.8 1.4 14.1 15.5

Pot..h, Lice, Tr-e. elensents 0.3 2.7 0.3 3.5 0.4 4.2 0.5 4.8 0.5 4.8 0,5 4.8 2.5 24.8 27.3

5. Vehiclea

4 W-drive (1), Truck (1), Van (1)Trock with crone (1) 0 67.6 0 67.6 67.6

Sloon rar (Bertrtn) 2.9 4.3 2.9 4.3 7.2

6. Re=earrh EquipmetMeteOrologic1a Eq.ipme.,t (All MARDI

siaties-) 0 16.0 0 16.0 0 32.0 32.0

Field Crops Re-rtchSeed bed eq. (1), Soedg-ad-rs (2)Bagging eq. (NA), Oven (3), Balance (4)

CalcuIators (2) 7 9 7.9 . . 0 15.8 15.8

Lsafareameter (1I and niecellneus. eq. 0 4.3 0 4.3 0 8.6 8.6

Chenicnil; glesawere and Coneuneblen 9.3 0 9.3 0 9.3 0 9.3 0 9.3 0 9.3 0 55.8 55.8

Crop Protection Research

Centrifuge (5) Colny counte-(I)Colorimeter (5) Light trap (1)Microtowe (1) Gro.th Chk.ber (1)Re-earch Micro-ecpe (4) Tee-etereoncope

(4)Auto-lave (I) Spray Tower (1)

Surtion T-rp (1) 0 21.3 0 21.3 0 42.6 42.6

Mi.-ellan.eos ite-s 0 4.3 0 4.3 0 8.6 8.6

Chesicals, OluonseGre, Connasables 0 983 0 9.3 0 9.3 0 9.3 0 9.3 0 9.3 0 55.8 55,8 I :

Rhiubheun Rese.rchMier--cepe (1) Autoclave (1) 21.0

O-en (1) Freeze Drier (1) 0 10.5 0 10.5 5 21.0

Mi.rellananes oiar itema 0 4.5. 0 4.5 0 9.0 9 0

Subtotal 11 . Gooda 61.4 356,5 59.0 197.6 7.5 53.6 7.9 49.2 7.9 49.2 2.4 55.5 146.1 761.6 907.7

FIELD CROP RSEARICH PROGRAM - TOTAL 101.9 724.6 99.5 565.7 48.0 421.7 48.4 417.3 30.4 315.3 15,9 270.6 344.1 2715.2 3059.3

ANNEX 4Page 1

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

MARDI - Research Program for Pineapples

A. Introduction

1. The existing station at Jalan Kebun has been selected as theheadquarters for the centre for the Pineapples Research Program. Thestation at Alor Bukit, in the main pineapple growing region in southwesternJohore, will also serve as an important experimental center.

Pineapples in the Malaysian Economy

2. In recent years, Malaysia exported about M$ 50 million of cannedpineapples and juice. There were about 55,000 acres under pineapples inWest Malaysia in 1973. About 60% of the crop is produced by smallholdersand the rest by 3 large plantations. The average yields of about 8 tons offresh fruit per acre are low compared with 20-25 in Hawaii and for Queensland.Fruit quality control and handling is poor. Much of the fruit received atthe cannery is bruised and of uneven ripeness. Although the main localvariety, Singapore Spanish, has an attractive colour for canning, it is farfrom satisfactory in several other characteristics. It is poorly shaped andhas a thick and deeply indented skin with the result that wastage in process-ing is extremely high, varying between 80 and 85%. Also the brix/acid ratiois poor since the acid level is only about one-half that of good Hawaiianpineapples. Ester content, judged on the basis of aroma and taste, is alsoextremely low. Clearly there is an urgent need for research to develop abetter canning variety, since most world markets prefer fruit with higherester and acid contents, and because of the low yield and high wastage ofthe local fruit.

3. A further feature of pineapple production in Malaysia is that thecrop is mainly grown on acid peat soils, primarily because it is one of thefew crops which can be grown on these difficult soils.

4. Since MARDI took over pineapple research from MPIB in 1974, severalnew research programs have been commenced. Work is in progress in breedingand selection, pathology, plant nutrition, and crop agronomy. A new varietynamed Mas Merah giving 25% higher yield than Singapore Spanish has been selected.The most important areas of research to be undertaken are varietal improvementthrough selection and breeding, disease control, requirements for fertilizer

ANNEX 4Page 2

and water, replanting strategies (crowns vs. crown slips vs. suckers), cropphysiology (spacing), economics of alternative production systems, and fruitphysiology.

B. The Research Program for Pineapples

Description

6. The Project would substantially expand the present research efforton pineapples at Jalan Kebun and Alor Bukit. MARDI staff would be increased,international expertise would be recruited to assist in developing the researchprogram, and post-graduate fellowships would be provided for MARDI staff. Inaddition, equipment and fertilizer would be provided to assist in the expansionof the Program.

Research Program

7. Pineapple Introduction Breeding and Selection: The MPIB researchgroup has assembled a considerable selection of pineapple lines from withinMalaysia and from a number of overseas areas. Most of the overseas materialis not well adapted to Malaysian conditions, mainly because it comes frommuch higher latitudes than Malaysia. It is also probable that, since mostof the overseas material was sent on request and not collected directly byMalaysian scientists, it does not represent the most promising lines.

8. A program of collecting overseas material would be one of the firstundertaken under the project. Special attention would be given to equatorialregions in South America and Africa. This would provide a much broader basefor the Malaysian breeding and selection program and would enhance theprospects of developing more productive varieties. In addition, clonalselection within existing local cultivars could give substantial yieldincreases. Now that MARDI has developed tissue culture techniques forrapid multiplication of superior cultivars, any new varieties which aredeveloped could rapidly be brought into widespread use.

9. Disease Resistance: Pineapples in Malaysia are subject to severalbacterial and viral diseases, the most important of which is fruit rot whichcan cause between 10 and 60% fruit losses in affected fields. Thus in thebreeding and selection program, careful attention would be given to diseaseresistance and to research in the relevant areas of plant protection.

10. Plant Nutrition and Plant Water Relations: The current researchin Dlant nutrition at Alor Bukit is of good quality but requires expanding.SG.±± fertility studies have been done at only one or two locations and aregional study of the fertility status of Malaysian peat soils is necessarybefore general recommendations on fertilizer application for pineapples,(or for that matter any other crops) can be made. The present preliminary

ANNEX 4Page 3

studies of the inter-relationships between soil nutrient status and soilmoisture status would also be developed in detail. MARDI plans to recruita soil physicist/hydrologist for this work, which would be done in colla-boration with the proposed new Agricultural Engineering and Water ManagementProgram (Annex 8).

11. It is also proposed to study the application of leaf analysistechniques to determine fertilizer requirements, particularly since standardsdeveloped elsewhere for pineapples grown on mineral soils may not be directlyapplicable to peat soils. In this program it would be expected that thebackstopping soil science unit would contribute through special studieson the chemistry and physics of peat soils.

12. Replanting Strategies: Studies would be undertaken to develop themost productive replanting strategies. Pineapples can be replanted fromcrowns, crown slips, or suckers and the alternative systems of block replant-ing vs. continuous replanting need to be compared. Other aspects of cropagronomy which would be studied are the effects of different plant spacingwithin and between rows, the effects of replanting at different times of theyear, and the value of different weed control practices.

13. Growth Regulators: Little is known about the response to growthregulators under Malaysian conditions. Since experience from higher latitudeshas shown that pineapple is particularly responsive to growth regulators interms of floral induction, delay of ripening, and uniform ripening it isanticipated that this program would be given high priority. The Program wouldinclude research into kinds of regulator, rates, times of application (notonly in relation to night versus day, but also time of year). This work couldhave valuable effects in minimizing monthly fluctuations in production, thusimproving the efficiency of cannery operations.

14. Agricultural Engineering: Collaborative research with the Agricul-tural Engineering Program would be undertaken to develop equipment andtechniques for clearing and preparing peat soils for pineapple planting. Asuccessful outcome could contribute significantly to expansion of pineappleplantings in Peninsular Malaysia.

15. Fruit Quality: Emphasis would be given to studies on fruit quality.One of the most important practical problems of the pineaRple canning industryis that of the variable quality of fruit on delivery to the cannery. Thisinvolves establishing precise criteria for acceptable quality at the factoryand making known to the individual producers the maturity criteria whichthey should apply in harvesting the fruit.

16. Utilization of Pineapple Waste: Research into the utilization ofpineapple waste would be expanded by the Agricultural Products UtilizationProgram. Even in an efficient cannery operation there will continue to bea large percentage of waste. The possible value of this material for pro-cessing as stock feed deserves collaborative research with other Programs.

ANNEX 4Page 4

Staffing

17. The present pineapple research team would be increased from 9 to18 graduate staff during the Project period.

18. The Project would provide 10 man-years of expatriate scientistsfor the Pineapple Research Program. An agror-.mist with extensive experiencein pineapple research would give assistance to the Program Coordinator inplanning and program development over the first three years, particularly inorganizing the collection and evaluation of new genetic material. He wouldalso operate his own research program. A soil fertility expert (Agronomist)to plan and participate in the fertility research on peat soils would beneeded for (3 man-years), and a plant phisiologist with experience withflowering and in the use of growth regulators would be appointed for (3 man-years). The Project would also provide for (4 man-years) of short-term con-sultancies to assist in specific aspec-ts of the program as it develops, andwould contribute part of these funds to finance,the Program Specialist Postassigned to the Deputy Director for Research Programs. The total cost tothe Project of internationally recruited specialists would be US$600,000.

Training and Fellowships

19. Further training of present staff would be vital to the successof the Pineapple Research Program. Apart from the Senior Scientist noneof the existing staff is trained to advanced levels and it is unlikely thatany of the additional staff to be recruited to the team would have higherdegree training. Where possible, it would be arranged that the trainee'sthesis subject was relevant to pineapple research. In addition, the Projectwould provide for staff to work at overseas research institutions working onproblems relevant to the Malaysian pineapple program.

Land, Buildings, Equipment and Materials

20. The land available at Jalan Kebun and Alor Bukit would be adequatefor the pineapple program. Some additional plant houses and ancillary build-ings would be needed at Jalan Kebun and a small field laboratory at AlorBukit. The Project would provide equipment including farm equipment; researchequipment; vehicles; and workshop equipment. A substantial sum is needed forfertilizer because pineapples are a demanding crop and the peat soils on whichthey are grown are low in available nutrients.

Organization and Management

21. The Pineapple Research Program would operate as a research sectionof the Horticultural Crops Research Program and would be responsible throughthe Senior Scientist to the Assistant Director for Producticn Research.

22. The visiting scientists working in the Program would provide avaluable infusion of experienced research personnel while several of thepresent staff are overseas obtaining post-graduate qualifications. The

ANNEX 4Page 5

visiting scientists will pursue active research programs and would notoperate solely as advisers.

Cost Estimates

23. The estimated cost of all goods and services which would befinanced for the Pineapple Research Program is shown in Table 4.1.

April, 1975

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

PINEAPPLE RESEARCH PROGRAM

Coot EUti-otes - US$ x 1000 Eanivaloot

Year I Year 2 Year 3 Year 4 Year 5 Year 6 Year. 1-6 US x 1000lSTEMS

Local Foreign Local Foreign Local Foreign Local Foreign Local Foreign Local Foreign Local Foreign Total

l SERVICES

1. E.patriate SpecialistsSenior Scientist (Agronomist), 3 MY 9.0 51.0 9.0 51.0 9.0 51.0 27.0 153.0 180.0Soil Fertility , Y 9.0 51.0 9.0 51,0 9.0 51.0 2. 5. 8.Short-torer Conoultont 6 MY 6.0 34.0 6.0 34.0 6.0 34.0 6.0 34.0 6.0 34.0 6.0 34.0 36.0 204.0 740.0

2. Fellomohip.

Staff Pellooahip., 26.5 MY 0 63.6 0 63.6 0 63.6 0 63.6 0 63.6 0 63.6 0 381.6 381.6

Subtotal I - Serviree 24.0 199.6 24.0 199.6 24.0 199.6 24.0 97.6 9 7.0 97.6 90.0 891,6 981.6

1 GOODS

1. ldisPlant Ho..eo (2) 16.1 6.9 16.1 6.9 32.2 13.8 46.0Loboratory Building, Northern Region 6.9 3.5 6.9 3.5 13.8 7.0 20.8Insoot -ouee, NUr-ery 12.5 6.1 12.5 6.1 25.0 12.2 37.2

2. Foro leveio,=ent - Fence Wire,c1lvert.,etc. 0- 9.6 0 9.6' 0 9.6 0 9.6 0 38.4 38.4

3. ParE Equip=ent

Single a.le Tr-otor (3) 0 1.6 0 1.6 0 1.6 0 4.8 4.8Tractoro; 3 o 45 HP, 2 x 75 HP 0 4.4 0 6.1 0 4.4 0 10.4 0 25.3 75.3Tractor drawn trailer. (3) and tankers(3) 0 4.5 0 4.5 0 4.5 0 13.5 13.5Mo-ers(S) Pert. broadcasters (2)

Crop drier (1) Pompa (3) 0 3.5 0 3.5 0 3.5 0 3.5 0 3.5 0 3.5 0 71.0 21.0FPrn hand toola and i=plewnts 0 1.6 0 1.6 0 1.6 0 1.6 0 1.6 0 1.6 0 9.6 9.6

Spore Parte, 15% 0 2.3 0 1.9 2.3 0 0.7 2.9 0.7 0 10.8 10.8

4. Pertiliter and Peoticides

Urea, 450 teno.,M$700/ton 1.7 24.3 1.7 24.3 1.7 24.3 1.7 24.3 1.7 24.3 1.7 24.3 10.2 145.8 156.0Phosphato, 180 tons 9 M$ 500/ton 0.5 6.9 0.5 6.9 0.5 6.9 0:5 6.9 0.5 6.9 0.5 6.9 3.0 41.4 44.4atlgah, 90 tona ( M$

400/ton 0.3 2.8 0.3 2.8 0.3 2.8 0.3 2.8 0.3 2.8 0.3 2.8 1.8 16.8 18.6

5. Vehicles

4 W-drive (I) Trock (1), sparen 0 18.9 0 18.9 18.96. Laboratory Equipment

Infra-red apectrophotoeter (1)Growth chamber 0 18.5 0 18.5 18.5

CO2

Gas Analy.er (1) Leaf Area Meter(l)Refrigerated centrifuge (1) 0 38.0 0 38.0 38.0Oven (2) lncubat-r (2) Microscopes (3)Ph moters (2) Shakera (2) Bench (1)Scittillation cannter (1) Plnchet

Conter (1) 0 o 20.8 0 20.8 20.8Contrif.ge (2) Chromotography eq. (1)Furnace (1) Micro Kjeldahl (2)

Flano photometer (1) Rotary Shaker (1)Di.c Electrophoreeio (1) 0 9.5 0 9.5 9.5Other Laboratory equipoent 0 19.2 0 19.2 0 38.4 38.4Che=icals, Gla ... re and Co-oaroble, 0 9.3 0 9.3 0 9.3 0 9.3 0 9.3 0 9.3 0 53.8 55.8

7. Warkahop Equipmont

Veritee iteme for JaSln Kebun ResearchStation 0 8.9 0 0.5 0 0.5 0 0.5 0 0.5 0 0.5 0 11.4 11,4

Subtotal !I Goods 38.0 221.1 38.0 103.0 2.5 71.3 2.5 59.2 2.5 66.7 2.5 49.6 86.0 571.7 657.7

PINEAPPLE RESEARCH PROGRAM - TOTAL 62.0 420.7 62.0 303.4 26.5 270.9 8.5 156.8 8.5 164.3 8.5 147.2 176.0 1463.3 1639.3

April 3, 19753

ANNEX 5Page 1

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

MARDI - Research Program for Cocoa/Coconut

A. Introduction

1. Almost 500,000 acres of coconut and about 40,000 acres of cocoa aregrown by smallholders in West Malaysia; coconut is also an important small-holder crop in Sabah and Sarawak. Coconut production has declined as manytrees passed the peak production years; replanting and new planting has notbeen sufficient to maintain production. Disease has also had its effect onboth coconut and cocoa production.

2. GOM has instituted a vigorous Replanting and Rebahilitation Schemefor coconut and a Cocoa Planting Scheme to encourage farmers to grow cocoaunder coconut. These programs achieved the replanting of about 7,000 acresof coconut and an increase of 13,000 acres of cocoa in 1972.

3. Smallholder coconut yields are generally lower than that obtainedby estates; probably due to the better management practices of the latter.A study made in 1965 showed the average yield on smallholdings to be 665 lbs/acre, compared to 1,300 to 1,600 lbs/acre for large estates. Many of thesmallholdings are on poorly drained coastal alluvial and peat soils; alsothe small farmers do not use as much fertilizer, do not adequately controlweeds and undergrowth competitition, and do not adequately control diseaseand pests.

4. World coconut (copra, coconut oil and coconut) production is heavilyconcentrated in South East Asia with Indonesia and the Philippines producingabout 50% of world production. Malaysia has the proper soil and climaticconditions to increase its share of the market. Because of the particularadvantages of the lauric oils of coconut and palm kernel and the use of coconutand cocoa in confectionaries it is envisaged that the demand for these productswill continue to be strong. The prices for coconut and cocoa products havebeen consistently good over the past ten years and prices have recentlyincreased dramatically. Although the world market is expected to be good,the local market, which now consumes more than 50% of the production, isalso increasing.

5. The rehabilitation of existing plantings and the extension of thearea devoted to both coconut and cocoa would be of major benefit to theMalaysian economy as a whole and to the small farmer in particular.

ANNEX 5Page 2

6. Recognizing the economic potential and the needs of smallholderfarmers, GOM, would continue the coconut and cocoa planting and rehabilita-tion schemes. However these schemes require the support and assistance ofa systematic and intensified research program to solve the technical inade-quacies that now restrict yields. Some of the principal constraints are poordrainage in some, and disease and pests in most areas. The West JohoreAgricultural Development Project (314-MA) will help to eliminate drainageproblems in that area.

7. Coconut and cocoa are faced with many other technical problems suchas cultural practices; intercropping, fertilization, weed control, varietyselection and development of hybrids.

8. The industry is therefore in need of a strengthened and expanded.research program to provide the technology to increase production and pro-ductivity. Eventually the research program would be extended to Sabah andSarawak as well.

B. Present Status of Research

Cocoa

9. Conditions in Malaysia are well suited to the cultivation of cocoa.The earliest cocoa planting in the country was at Jerangau in Trengganu whereunsatisfactory yields were obtained. However, within the last two yearsexperimental results have shown that yields of over 1,300 lb. per acre (mono-culture) are possible when using planting materials of selected crosses.Under coconut, yield levels of 1,000 to 1,500 lb. of dry beans have beenobtained in the Lower Perak area. In Sabah yields of 1,500 to 2,000 lb.per acre are not uncommon. In fact, indications are that far higher yieldscan be expected using improved planting materials and better managementpractices. Basic conditions required for good cocoa growth and yield areknown, but this information needs to be strengthened and expanded by a soundresearch program.

10. There are at present 8 organizations carrying out limited researchon cocoa namely:

(a) MARDI

(b) Dept. of Agriculture (Sabah)

(c) FELDA

(d) Dunlop Research Center

(e) Prang Besar Research Center

ANNEX 5Page 3

(f) United Plantation Research Department

(g) Borneo Abaca Ltd. (Sabah)

(h) Highlands Research Unit

Only the Dept. of Agriculture (Sabah) and Borneo Abaca Ltd. have any largescale breeding experiments and are in a position to produce progeny testedseeds.

11. At present the bulk of the research activities of the organizationsis mainly directed towards meeting the particular manurial or cultural needsof their respective organizations. Crop protection research has been limitedto testing of chemicals for control of pests and diseases as and when they,appear, i.e. only short term considerations.

12. In MARDI the cocoa research program covers a wider spectrum. Itis designed to involve the various disciplines of breeding, agronomy, nutri-tion, physiology, entomology, pathology and biochemistry in efforts to raisethe yield and quality of cocoa. The following areas are now being investigated:

(a) Crop Breeding - to produce genetically superior varieties orclones it is essential to have access to diverse genetic sourcesfrom which to select desirable characters. Fully appreciatingthe limited genetic variation in the small collection of varieties(Amelonado, Upper Amazon, Trinitario and Criollo) MARDI has takensteps to build up a germplasm collection by introducting geneticmaterials through exchange programs with international researchorganizations and will extend this through direct prospectingefforts among wild populations in Africa, South America or otherareas to be selected.

(b) Crop Husbandry - to ensure that the potentials of thesegenetically superior varieties or clones can be realised.

(c) Crop Protection - in most countries where cocoa is grown thetrees suffer serious damage from pests and diseases. Fortunately,in Malaysia there are no serious pathogenic diseases and pestdamage tends to be localised. Research is in progress to screenfor varietal resistance to cocoa die-back, stem canker and blackpod diseases. Apart from mammalian pests such as "musang",squirrels and rats which attack mainly cocoa pods, insect pestssuch as Helepeltis, cocchafer bettles, mealy bugs, etc., can becausing extensive damage to the leaves and young shoots.Research is currently being conducted to study the biology andfeeding habits of these pests to devise an intergrated approachin controlling them.

ANNEX 5Page 4

(d) Crop Processing - Cocoa processing research is required at thefarm level (drying) and at the mill level. There is verylittle information regarding efficiency of such crop processingmethods and even less is known about the loss in oil quality.

Coconut

13. Increased coconut productivity coupled with a suitable intercropwould be a combination of major importance in a diversified agriculturalsystem. In the commercial estates, copra yields of close to one metric tonhave been obtained, and half that amount by smallholders. There is a needto evaluate the existing methods of copra and coconut oil production, to befollowed by investigations to develop new improved techniques. Research insome countries has indicated that it is possible to double the copra yieldby using selected hybrid seeds and improved management levels. MARDI iscurrently investigating the following aspects of the coconut industry:

(a) Selection and Breeding - Considerable emphasis is given tococonut selection and breeding because experience overseashas indicated that with improved planting materials and bettermanagement techniques, yields of up to 2 tons of copra peracre are feasible. Due to the long breeding cycle of coconut(more than ten years), the lack of vegetative means of propaga-tion and low rate of multiplication, a germplasm collection isnecessary to provide a wide genetic base for selection.

(b) Crop Husbandry - When coconut is under planted with cocoa,weeds are gradually shaded out and any fertilizer appliednot only increases cocoa yield but also coconut yield. MARDIis looking into the fertilizer requirements of the intercroppingsystem and the feasibility of introducing other intercrops suchas coffee, pineapple, banana, and pastures in collaboration withthe other commodity research units. Most of the coconut acreageis planted on coastal belts where drainage is a problem. Withimproved drainage, coconut yield can be expected to increasedramatically.

(c) Crop Protection - Coconut pests and diseases are to a largeextent similar to those of oil palm. Crop protection measuresdeveloped for the latter will no doubt be applicable to coconutwith slight modifications to take into consideration thebiological and morphological characteristics of the coconut andintercropping situations. Research efforts will be focused ondeveloping control measures for Rhinoceros bettle and Pl2ycophorasach. Leaf eating insects such as nettle caterpillars, Artonacatoxantha, etc. tend to attack palms sporadically and occasionallyreach epidemic proportions. An integrated control approach isnecessary for the pests as predators and parasites normally keeptheir populations in equilibrium.

ANNEX 5Page 5

(d) Crop Processing - Very little information is currently availableabout processing either at the farm or mill level. It isessential that research be conducted in collaboration with theAgricultural Engineering and Product Utilization Units.

C. Cocoa Research Programs

14. The research program consists of four broadly based areas of studyand objectives:

Objectives

The objectives of the MARDI cocoa research program are as follows:

(a) breeding and selection - to produce genetically superiorvarieties/clones for commercial development;

(b) crop husbandry - to develop cultural practices such thatthis genetic superiority is realised to the fullest economicextent;

(c) crop protection - to develop improved crop protection measures;

(d) crop processing - to develop suitable crop processingtechniques.

15. To achieve these objectives an intergrated multidiscriplinaryapproach will be emphasised. This necessitates an understanding of thephysiological, biochemical, and genetical processes in the plant, and thepest and disease patterns present in the crop.

Selection and Breeding

16. Germplasm Collection: Great emphasis will be given to germplasmcollection in the breeding program because the extent of the genetic varia-bility will determine the rate of the selection progress. These materialsare the building blocks of the plant breeder and he can produce change onlyto the extent of the variation provided for by his breeding populations.

17. Furthermore, cocoa has only recently been introduced into Malaysiaand there is very little reason to presume that small random collection ofgenetic materials (on which the present breeding program is based) introducedinto this country, is the best suited or adapted for local conditions.

18. The present MARDI breeding program is based on a small collectionof Upper Amazons, Amelonado, Trinitario and Criolla clones acquired by theDept. of Agriculture during the 1950's and are grossly inadequate for anybreeding program.

ANNEX 5Page 6

19. The main source of natural cocoa populations is in the UpperAmazon Basin. Germplasm collections have been established at variousresearch centres in Trinidad, Brazil, Costa Rica, Ghana and Nigeria,based on several prospection efforts in the Amazon Basin. Cooperationwill be sought from these various organizations to assist MARDI indeveloping similar collections.

20. Inheritance Studies: To develop any effective selection criteria,MARDI needs to conduct inheritence studies to identify which components orfactors are critical to yield improvement, their level of inheritance, andthe correlation between them. This will allow the plant breeder to givethe right kind of priorities to each factor and to decide on the best wayof combining them to obtain the optimum bean yield.

21. Breeding Methods: Initially breeding methods would be basedmainly on experience developed elsewhere, because knowledge of the geneticprocesses in cocoa is lacking for local populations. The bulk of the breedingeffort at present is devoted to hybrid crosses between individuals and clonesof different varieties, and from different geographic populations. A similarapproach would be adopted for the MARDI program and crosses or types ofcombination which appear to show hybrid vigour would be tested. Clonalselection offers the greatest scope for immediate yield improvement.

22. Varietal and Clonal Testing: Before any material can be consideredfor commercial planting, it is necessary to adequately test them under a widerange of environments. Furthermore, it is anticipated that this will allowplant breeders to identify varieties or clones which are best adapted toparticular soil types or environments and also those which are more tolerantto diverse conditions.

23. Vegetative Propagation: To fully exploit the benefits of clonalselection, methods must be available to multiply very rapidly large quantitiesof materials by vegetative means. Research projects to investigate fully thedifferent methods of vegetative propagation such as buddings and cuttingshave been given priority in research programs.

24. Cultural Practices: Cocoa is a relatively new crop in Malaysiaand cultural practices are largely adopted on a trial and error basis fromexperience in other countries. Therefore there is considerable scope foryield improvement in the expansion of research on cultural practices suitablefor local conditions.

25. Cropping Systems: Given that several cropping systems are possible,there is a need to determine for each system the optimu.n cultural and fer-tility requirements. Plant density is the second important aspect to beconsidered and it can be expected also to affect the nutrient requirementsof the cocoa bush. In its natural habitats, cocoa grows under jungle shadeand for this reason, it was assumed that shade was required for optimumgrowth and yield of cocoa, and attempts were made during its domestication

ANNEX 5Page 7

to simulate this jungle environment. More recently however, it has beendemonstrated that it is possible to grow cocoa without shade and there isssufficient experimental evidence to indicate that much higher yields canbe expected. There appears therefore to be two cropping systems possiblei.e. growing cocoa with and without shade.

26. Moisture requirements, though less easy to manipulate exceptthrough the expensive method of irrigation or choice of site, is ofimportance because cocoa appears to be a moisture-sensitive crop; thisaspect requires thorough investigation.

27. Seedling Studies: Seedling studies are required to determineand develop optimum seedling and nursery management techniques and toidentify suitable seedling characteristics which are related to adultyields.

28. Flushing and Flowering: Studies to provide comprehensiveinformation on the flushing patterns, flowering cycles and the incidenceof cherelle wilt are important because they represent periods of intensephysiological activity within the plant. Knowledge of these activitieswill help in developing more effective cultural practices e.g. in timingof manurial application to provide nutrients when they are most criticallyrequired or can be most effectively utilized.

29. Crop Protection Studies: The need to develop economical andeffective crop protection measures requires very little emphasis. Infact, the cocoa die-back problem has frequently been citied as the mainfactor for the slow rate of expansion of cocoa in this country.

30. Diseases: Since cocoa is a relatively new crop in Malaysia, thereis a need to assess the extent of the disease problem in terms of the typeof diseases present and the extent of the crop losses they cause. Informa-tion on the disease incidence for Peninsular Malaysia is now being compiledand techniques for assessing crop losses must be established. Nevertheless,it is clear that vascular streak die back, black pod and to a lesser extentstem canker and root diseases will require immediate attention.

31. Virus and bacteria do not now pose a serious problem with cocoain Malaysia, but in view of the difficulty of developing any effectivecontrol measure once the disease is established (as in the case of thecocoa swollen shoot disease in Ghana), particular attention is paid toprevent its introduction and to minimise the risk of spread of the diseaseshould it be present.

32. Insect and Mammalian Pests: As in the case of disease, theinitial research activity is concerned with assessing the extent andnature of the pest problem. At present, it appears the Helopeltis, andthe two cockchafers, Adoretus and Apogenia, require close attention.

ANNEX 5Page 8

33. Rodents, in particular the squirrels and rats, can constitutea major pest problem in some cocoa growing areas. The extent of the croploss caused by these pests will need to be assessed. An understanding ofreproductive behaviour, food requirements, nesting and movement habitsprovides the key to the development of any long term and effective controlmeasures, whether by chemical methods or cultural and sanitary practices orboth.

34. Weed Control: Weeds compete with the economic crop for mositureand nutrients and frequently can harbor diseases. For this reason, inplantation crops, expenditure on weed control measures forms a sizeableitem. In cocoa, weeds are a problem during the first few years of plant-ing, after which they gradually become shaded out.

35. Cocoa Processing and Storage: Effective crop processing methodswhich begin at harvesting, are necessary to ensure the maximum recovery ofgood quality cocoa beans and are of special significance in a crop such ascocoa where flavour is of particular importance. Insofar as extraction ofthe beans from the pods is concerned, the main consideration is whether ornot a mechanical method might be used to replace the existing method ofmanual pod breaking.

36. Fermentation represents the most critical stage in cocoa processingbecause unfermented cocoa does not posses the desired flavour characteristic.Work carried out elsewhere has indicated that several factors can influencefermentation. These include the ripeness of the beans, bean size, the in-terval between harvesting and pod-breaking, the climate, the season, batchsize, the amount of mixing and the amount of aeration. All these factorsaffect the duration of fermentation to various extents, some are interdepen-dent and some are not easily subject to control.

37. Both sun drying and artificial drying would need to be looked intoin terms of their effectiveness and economies. For artificial drying, bothsmall scale and large scale drying methods would need to be considered.

38. As the acreage and yields of cocoa increase, the need for developmentof suitable storage facilities would be studied. Storage would be developedthat would control pest and fungal infestations.

D. Coconut Research Program, 1975-1980

Objectives

39. The objectives of the research program for coconut are similar_o that set out for the cocoa program but greater concern is given to maxi-mising the returns per acre through intercropping, as well as to maximisethe productivity of the coconut. Important modifications are necessary in

ANNEX 5Page 9

the coconut program to take into account the long term nature of the crop,the low rate of multiplication, and the lack of vegetative means of propaga-t ion.

40. Selection and Breeding: Considerable emphasis is given to breedingbecause this has to a large extent been neglected in the past and systematicefforts to improve the crop through breeding have not been developed to anydegree in Malaysia.

41. Germplasm collection: The importance of germplasm collection indetermining the rate of selection progress has already been stressed in thecocoa breeding program. In coconuts, the need to maintain a wide geneticbase is even more critical because of the long breeding cycle of more than10 years. There is therefore, a need to carry on this work further and toexpand the collections of genetic materials. First, putting together mate-rials from the various regions in Malaysia; secondly, to import materialsadapted to the particular climatic conditions of other countries, to forman important source of variability. In the build-up of genetic resources,attempts will be made to acquire materials from various countries throughtheir research organizations, including a collection mission to selectedcountries.

42. Inheritance Studies and Breeding Methods: In evaluating anddeveloping any effective breeding method, an understanding of the inheri-tance of the yield components is necessary. An understanding of the physio-logical basis for the yield differences is obviously an important pre-re-quisite.

43. The bulk of the breeding effort in the world at present appearsto be concerned with production of hybrids between dwarf and talls. Expe-riences elsewhere, in particular India, Ceylon and Africa have indicatedthat such hybrids offer the best scope for yield improvements.

44. There is no easy method of vegetative propagation but attemptswill be made to develop very rapid multiplication techniques through tissueculture. Because of its similarity to the oil palm, it will be appropriateto consider this aspect under the oil palm tissue culture program.

45. The long life span of the coconut makes experimentation and breed-ing in this crop extremely difficult and slow. Studies'on the seedlings mayprove to be extremely valuable if it can be ascertained that certain juvenilecharacteristics are correlated with later yields.

46. Cultural Practices: Although coconut has been grown in Malaysiafor a long time, knowledge of the optimum cultural requirements is limitedbecause systematic research in this area has been lacking.

47. Fertilizer and Moisture Requirements: At present fertilizerusage is minimal in coconut cultivation. However with improved culturalpractices, in particular adequate drainage, marked responses in yields to

ANNEX 5Page 10

fertilizer applications have been reported. Moisture control is anotherfactor which can have a major role in crop improvement. A considerableacreage of the coconut in Peninsular Malaysia is grown in coastal areaswhere the main problem is inadequate drainage.

48. Plant Density and Intercropping: Maximum yields can only beobtained if the palms are planted within an optimum density range. Thecurrent practice is to plant the tall variety at approximately 60 palms/acre and the dwarfs at approximately 100 palms/acre. Whether these arethe optimum densities for Malaysian conditions must be determined.

49. Intercropping is an important project in the agronomic researchprogram. The potential for coconuts depends to a large extent on the scopefor intercropping or catch-cropping. Given that intercropping of coconutshould become an economic reality, it would be a natural outcome to evolvesystems of agriculture which would allow for maximising the return from bothcrops.

50. Crop Protection: Coconut pest and diseases are to a large extentsimilar to those for oil palms. Crop protection measures developed for thelatter will no doubt also be applicable to coconuts. To that extent, thebulk of the crop protection studies n coconut will serve to supplement theresearch efforts in the other crop except that consideration has to be givento the different biological and morphological characteristics of the coconutand to pest or disease problems specific to this crop.

51. Crop Processing: Effective crop processing methods are necessaryto ensure the maximum recovery of good quality products. The method ofprocessing may be separated in two phases. The first concerns the harvestand extraction of the copra from the coconuts carried out by the farmer,and the extraction of oil from the copra, carried out by small millers.Since the small millers do not normally have effective process control, itis difficult to assess the efficiency of the existing processes. The methodused for harvesting coconut and extraction of oil from copra must be thor-oughly investigated.

E. Staffing

52. As part of the project, professional research staff would beupgraded and increased from the present 13 to 22 by 1980, a comparableincrease in supporting staff would also take place. The experience andleadership of the unit would be strengthened by the provision of 10 man-years of internationally recruited senior scientists consisting of a (a)plant breeder, (b) pathologist and (c) a bio-chemist, each on a long termbasis (minimum 2 years each); and 4 years for short-term consultancies(including a contribution to the cost of financing the Program SpecialistPost assigned to the Deputy Director for Research Programs). These scien-tists are estimated to cost US$600,000 (table 5.1).

ALNNEX 5Page 11

F. Fellowships and Training

53. The internationally recruited scientist would provide on the jobtraining. InTaddition 32 man-years would be provided for post-graduatedegrees and study tours to upgrade existing and new local professionalstaff. Fellowships would consist of 30 man-years for training at the MsCand PhD levels and 2 man-years for short term study tours.

G. Land, Buildings, Equipment and Materials

54. The unit has 400 acres of land for research at Telak Anson andproposes to acquire and develop an additional 1,000 acres during the project.A major building program would be required to service the existing 400 acresand the proposed extension. Because of the importance of cocoa and coconutin the states of Sabah and Sarawak a building program has been proposed therealso. Buildings would consist of laboratories, plant houses, processingfacilities, storage, offices, and staff quarters at the proposed sites.

55. The project would require an extensive amount of laboratory equip-ment, field equipment, and vehicles. Materials and supplies such as fer-tilizers, herbicides, insecticides would be provided.

56. The Project would also provide for the collection of germplasmmaterials overseas to give a broader base to the breeding and selectionprogram.

H. Organization and Management

57. The cocoa/coconut research program will be directed by a SeniorScientist (Program Coordinator) responsible to the Assistant Director forProduction Research. There will be a particular need for close collabora-tion with other commodity research programs in dealing with inter-cropping,pest, insect and disease control. The unit will also work closely with theAgricultural Products Utilization and Agricultural Engineering and WaterManagement Units on aspects of product processing, product quality, irriga-tion and other cultural practices. Extension will also play an importantrole in disseminating information to the States and to the many small farmerwho would be the major beneficiaries of the results of tbis research program.

ANNEX 5Page 12

I. Cost Estimates

58. The estimated cost of all goods and services which would be fi-nanced for the Cocoa/Coconut Research Program is shown in Table 5.1.

April, 1975

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ANNEX 6Page 1

MiALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

MARDI - Research Program for Livestock

A. Introduction

Livestock Production in the Malaysian Economy

1. Livestock production accounts for less than 5% of the gross valueof agricultural production in Malaysia. Meat consumption is concentratedmainly in the towns and among the Chinese sector of the population. Porkis consumed solely by the Chinese, and beef, mutton and poultry by allcommunities.

Projected Consumption of Meat in Malaysia 1968-80 /a

Consumption per Capita Total Demand Predicted Annual Growthh& (000 Metric tons) in Demand 1968-80

1968 1975 1980 1968 1975 1980 1968 - 1980 (%)

Beef 1.7 2.2 2.6 17.4 27.5 37.4 6.6Pork 14.6 18.1 21.1 53.6 78.7 103.3 5.6Mutton 0.4 0.5 0.6 3.96 6.3 8.6 6.8Poultry 5.3 6.8 8.2 55.1 85.2 117.9 6.5

/a Source: Ministry of Agriculture.

There are substantial imports of beef and mutton into Malaysia but onlysmall imports of pork and poultry meats, yet the market for pig and poultrymeat is larger than that for beef and mutton. About 4,000 cattle and 50,000sheep are imported annually for slaughter.

2. Sweetened condensed milk is the most popular dairy product. It isused for infant feeding by the lower income segments of the population andby all groups in tea and coffee. Powdered whole milk and milk based infantpowdered foods are increasing in popularity, but reconstituted whole milkis not popular. Consumption of imported sterilized and frozen milk is limitedby its high price. Fresh milk from smallholder Indian dairies and commercialdairies accounts for about 7% of milk consumption, with 93% being imported.The estimated demand for milk in 1980 is 9.2 million gallons compared with6.0 million gallons in 1973.

ANNEX 6Page 2

3. In 1970 the total consumption of eggs was 1,200 million units andit is estimated it will be 1,928 million units in 1980.

4. The numbers of livestock in Malaysia, the numbers slaughteredand the numbers imported annually are: 1/

No. Present No. Slaughtered No. Imported

Cattle Beef andDraught 241,000 )

Cattle Milch 64,000 ) 44,000 4,000Swamp Buffaloes 230,000 )Murrah Buffaloes 3,000 ) 36,000 3,000Goats 333,000 70,000 exportedSheep 38,000 47,000 50,000Pigs 725,000 927,000 exported.Poultry /a 7,500,000 6,500,000

/a Commercial Farms and Hatcheries.

The Cattle Industry

5. Beef cattle numbers are static. The major breed is the small bodiedKedah-Kelantan, which are kept mainly in small herds. There is no traditionin Malaysia of growing feed for cattle and they are normally pastured onwaste lands, forest margins and roadsides. The owners especially in thecase of Indian owners of dairy cattle also cut and carry grass for them fromthese places. During the off-season, where double cropping of rice is notpracticed, the cattle graze on rice stubble. They also utilize by-productssuch as rice straw and rice bran when these are available. Under theseconditions standards of nutrition and husbandry are poor and cattle product-ivity is low.

6. The National Livestock Development Authority (NLDA) is developing33,600 acres of land in eight ranches. So far, they have sown 3,600 acresof pasture and have 2,900 cattle of various breeds. They have plans toincrease productivity by crossing the local cattle with exotic breeds.However, the cattle on these ranches will represent only 10% of the existingcattle population and, because of competing claims for use of the betterland, cattle raising is likely to remain largely in the hands of small mixedfarmers.

1/ Source: Ministry of Agriculture.

ANNEX 6Page 3

7. Improvement of the overall nutrition and husbandry of these animalswould immediately increase beef production. One method of improving nutritionwould be to feed agricultural by-products to these cattle. The availabilityof these by-products in tons annually is: rice straw 1.25 million; rice bran140,000; wheat middlings 30,000; palm kernel cake 40,000; oil palm sludge250,000; pineapple bran 40,000; tapioca chips 45,000; and tapioca dry refuse110,000. There are problems with rice straw and rice bran because of thelimited storage life of these materials. The large-scale use of these by-products at the village level would require careful planning and organization.

8. The major virus diseases and pleuropneumonia are absent fromMialaysia. Bacterial diseases (anthrax, black leg and brucellosis) are rare.Haemmorrhagic septacaemia, babesiosis and theileriosis are present as areinternal parasites. The common cattle tick (Boophilus microplus) is presentbut the local cattle show considerable resistance. Assessment of tickresistance would be essential in any program based on crossbred cattle whereone of the parent breeds was tick susceptible.

9. Buffaloes contribute over half the Malaysian beef supply. Mostof them are swamp buffaloes, weighing 900-1,000 lbs at maturity, but a fewMurrah buffaloes are kept by Indians for milk production. They are keptin the rice areas and graze fallow padi. In these areas, the numbers aredeclining due to double cropping of rice and farm mechanization. The growthand reproductive potential of animals kept under good nutritional conditionsneeds to be tested.

10. Most of the natural milk is produced from Local Indian Dairy (LID)cattle in small herds owned by smallholders of Indian extraction and is solddirectly in unpasteurised form. Some pasteurisation is done in the cities,e.g. the milk from the NLDA herd at Behrang is taken to Kuala Lumpur forpasteurisation and sale. In Malaysia the average milk production per lacta-tion is 1000-1500 lbs. The Veterinary Department has attempted to improvethe milk production in the local dairies by inseminating LID cows with semenfrom exotic breeds and on their farm at Kluang there is a program to developcross-bred cattle for the dairy industry.

The Pig Industry

11. The pig industry in Malaysia is modern, with pigs kept under goodhusbandry conditions in concrete or slatted floor piggeries. Piggeries inexcess of 100 sows are common. One million pigs are sladghtered annuallyand the bulk of the pork is consumed locally in fresh forms. There is someexport to Singapore. The pig industry is based on the importation ofpurebred stock of improved temperate zone breeds, to produce cross-bredpigs. Breeding facilities are available locally. Artificial inseminationis common and sires are provided by the Veterinary Department. The pigindustry is well established and has advanced to the point where a perform-ance testing program is needed to identify superior boars for AI service.

ANNEX 6Page 4

Sheep and Goats

12. Sheep and goats are kept in small flocks by Malay and Indianfarmers under village conditions. The plane of nutrition is low, internalparasites are common, and the animals are small. Research has been doneby the Veterinary Department to determine the potential for increasing thesize of local goats by cross-breeding.

Poultry and Eggs

13. The growth of the poultry industry since 1964 has been spectacular,both in the production of chicken meat and eggs. About 90% of the stockare bred from imported temperate-breed parent birds.

14. The egg industry is highly developed, but the broiler industryis less efficient. Many broilers are kept semi-intensively and efficiencyof food conversion is low and mortality high. They are marketed at about12 week weighing 3 lbs or less. Newcastle disease, fowl pox and fowl plagueare controlled by vaccination. Respiratory diseases are common. Furtherexpansion in table bird production appears to offer the quickest means ofimproving local diets with more animal protein.

Feedstuff Imports

15. The pig and poultry industries are heavily dependent on importedfoods. It is estimated that feed imports are now of the order of M$ 200million a year. Much of the current interest in field crops is concernedwith the production of a much higher proportion of these feeds withinMalaysia.

Present Status of Research

16. Before the establishment of MARDI, livestock investigations werecarried out by the Veterinary Department. They were interested in thebreeding, health and nutrition of cattle, pigs and poultry, and had estab-lished a number of experimental programs at several different centers. Thework was largely of an ad hoc nature, and lacked guidance from experiencedresearch workers. However, the Departments work in disease control is of ahigh standard, and its activities have made valuable practical contributionsto the substantial growth and improved efficiency of the pig and poultryindustries during the 1950's and 1960's.

17. When MIARDI assumed responsibility for livestock research itestablished a Livestock Division divided into the four branches of animalbreeding and genetics, animal nutrition, animal physiology and animal husbandry.The Division is responsible for research in these disciplines relevant toimproved production of beef and dairy cattle, buffaloes, pigs, sheep, goatsad poultry. To undertake a commodity oriented research program, units havebeen set up for beef, dairy, swine, small ruminants, poultry, buffaloes and

ANNEX 6Page 5

artificial insemination. These units include staff from the Crop ImprovementDivision, and the Economics-Statistics and Project Development Division.

18. The lack of experienced personnel in the livestock program is aserious problem for MARDI. The Livestock Division did not take over trainedpersonnel, or existing programs and facilities as did some of the otherDivisions in the Institute. Of the 13 graduate staff, two have PhD, threehave MSc, four have BSc (Honors) and four have BSc degrees. The total Divi-sional staff, including technicians and farm staff, is 55.

19. The experimental facilities are very limited. At Serdang thereare a number of temporary pens for cattle work and a limited holding areaof poor pasture for cattle. The temporary facilities for poultry workseverely limit the scope of experimental work, and the pig studies are beingdone in space provided by the Veterinary Department and on farms. The pro-blem of facilities will be greatly improved once the 1975 building programat Serdang is completed and also with the completion of the extensionfacilities planned at the sub-station at Kluang in Johore and Bukit Ridanin Pahang.

20. At present, all the experimental work in progress is in animalnutrition and is located at Serdang. The amount of work being done has beendictated by the availability of staff and facilities. Also, up to July 1974,the Division has lacked adequate direction because the Head of the Divisionalso held the position of Director of the Food Technology Research andDevelopment Centre, which absorbed much of his time and attention.

21. The beef nutrition program is concentrating on evaluating localfeed sources. Using sheep as the screening animal, the digestibility andutilization of several agricultural by-products has beeu determined. Theproducts tested were: rice straw, rice bran, copra cake, molasses, poultrywaste, tapioca chips and urea. Rice straw in association with urea andmolasses based diets has been utilized successfully in association withother products such as tapioca.

22. In a study with Kedah-Thai cattle with diets with differentroughage/concentrate proportions, growth rates as high as 0.43 kg/day wererecorded over 34 weeks. The quality of the research is good, but more atten-tion to diets likely to be used in practice is required.

23. The Dairy Unit has completed a survey to provide basic data on thestructure and productivity of the dairy industry in Malaysia. Other work inprogress is testing the value of different proportions of protein andcarbohydrates supplement for milk production and calf growth. An inseminationprogram using Jersey and Brown Swiss semen on LID dams has been commencedas a first step in evaluating milk production from local cattle crossed withexotic breeds.

ANNEX 6Page 6

24. The studies with pigs and poultry are largely concerned with testingthe effects of substituting locally produced carbohydrate concentrates(tapioca and sago) for maize in production rations. The early indication isthat a higher percentage of substitution can be made without any decline inproduction.

25. Pasture research is being conducted by the Pasture Unit in the

Crop Improvement Division which has studies underway in plant introductionand evaluation, plant nutrition, and animal production at both the Serdangand Kluang Stations. Advice on pastures is freely available to the animalhusbandry workers through the Pastures Unit on which it is represented.

26. This arrangement recognizes an important principle. Research inwhich different pasture treatments are being evaluated with a standard typeof animal is pasture research, and belongs in the hands of workers traine1in plant science. Research in which different types of animals are evaluatedon a standard pasture is animal research, and belongs in the hands of researchworkers whose training is in animal science. Because pastures are the majorresource for ruminant animal production this correct allocation of responsi-bility, with the proper liaison machinery, will greatly assist MARDI's live-stock research programs.

B. The Research Program on Livestock

27. It is clear that if future consumption targets for livestockproducts are to be met, a major effort in industry modernisation, and theunderlying research, are needed. The Project would aim to improve boththe scope and quality of MARDI's livestock research on all classes ofruminant livestock, pigs, and poultry. It would provide experienced overseasscientists to assist in planning and developing research programs, fund asubstantial fellowship program, and provide buildings, equipment, livestockand materials for work at the Serdang, Kluang and Bukit Ridan Stations. Inthis Program the provision of foundation livestock for animal improvementprograms is a particularly important feature.

Research Programs

28. Fields of research in each of the Units would include an evalua-

tion of breeds. Local animals and their crosses would be compared underthe same conditions by measuring meat and/or milk production, efficiencyof feed utilization under different nutritional regimens, reproductivecapacity and carcass or milk quality. The nutritive value of agriculturalby-products would be determined and their incorporatior in feeding systemsfor improved production would be investigated. For rum-nants, a programon the effect of pasture improvement and pasture management on production,

would be carried out by the Pasture Unit in the Field Crops program.

ANNEX 6Page 7

Beef Cattle Research

29. The cattle improvement program would be based on upgrading thelocal stock rather than by their complete replacement with exotic breeds.Some crossbreeding has been done in the past, but no objective comparisonsof performance have been made. Priority would be given to an evaluationof the performance of local Kedah-Kelantan cattle and their crosses bothwith European and Zebu breeds such as the Brahman. Performance testingshould be done at both high and intermediate phases of nutrition. Selectionfor tick resistance will be an important aspect of the program.

30. Feeding trials would be continued and expanded to determine thenutritive value of agricultural by-products and locally produced supplements.Their value in practical diets would be tested in feeding trials usingquantities of supplement likely to be economically practical in Malaysia.

31. The Pasture Unit would have prime responsibility for studies ofpasture management, but close collaboration between the pasture unit andthe beef unit would be necessary if carcass quality and breed differencestudies were to be included in these trials.

Buffalo Experiments

32. With buffaloes, the current observational trials are expectedto yield information on the breeding cycle of cows, the detection of oestrus,their mating habits and the necessity for buffaloes to wallow.

33. Studies of the performance of the Murrah and Swamp buffaloes wouldbe similar to those on beef cattle breeds. Experiments on the response ofbuffaloes to different diets (including the feeding of concentrates) andtheir performance on different pastures would also be done on similar linesto the beef cattle program.

Dairy Cattle Research

34. Precise information on the productivity of dairy cattle in Malaysiais lacking. As a first step, the predominant LID cattle, and their crosseswith other dairy breeds, need to be compared in terms of milk production.This study should include measurements of the response of these animals toconcentrate feeding as a supplement to pasture.

35. Studies of different calf rearing systems should be undertaken todetermine the effects of the levels and types of starter diets on calf growth,maturity, and subsequent production. Collaborative studies with the pastureresearch workers would be undertaken to determine the value of differentpastures and pasture utilization systems in terms of milk production. Workis also needed to develop efficient milk handling and storage equipment foruse by the small milk producer. TARDI's Agricultural Engineering and WaterManagement Program would collaborate in the design of suitable equipment.

ANNEX 6Page 8

Pig Research

36. The present pig industry in Mfalaysia is based on the applicationof sound management principles to herds bred from high producing stock importedfrom temperate countries. Little selection has been done for production underlocal conditions and the reproductive and growth performance of pigs inMalaysia could be substantially improved through selection. A program oftesting would therefore be undertaken under the Project. It would be basedon crossbreeding and progeny testing among the principal breeds with selectionbased on average daily gain, feed conversion efficiency and proportion ofcarcass lean meat. This would involve on-farm studies of large numbers ofanimals and careful control of nutritional regimes. Selection of the mostproductive stock from existing herds for breeding would undoubtedly lead torapid upgrading of the population.

37. The feeding experiments just getting under way at MARDI would bedeveloped into a comprehensive program to determine the value of locallyavailable feedstuffs and the protein and energy requirements of all classesof pigs, including pregnant sows and gilts. Nutritional experiments wouldalso examine the possible partial replacement of protein meal in pig rationsby synthetic amino acids.

Poultry Research

38. Broilers bred from stock of temperate origin do not do as well inMalaysia as in their own countries. A program designed to breed stock welladapted to local conditions, would be commenced.

39. Feeding experiments are required with chickens of local and overseasorigin, using diets of varying crude protein and energy content and withvarying levels of amino acids, to determine the maximum production in the localenvironment.

40. The present work on the nutritive value of locally grown feedsand locally available by-products would be expanded into a comprehensive studyof the value of these feeds in practical diets for broilers and layers.Examination of these feedstuffs would also include studies on the effect ofdifferent methods of processing on metabolizable energy.

41. Although the duck industry in Malaysia is small, there is a growingdemand for duck meat and eggs, particularly by the Chinese population. Atpresent this demand is met mainly from imports from otlher Southeast Asiancountries. Studies involving breed selection and feeding would be undertaken.In this work feeding tests with local feedstuffs comparing the production ofboth meat-type and layer-type ducks on diets of varying protein and energyo-ntent would be an important part of the program. Also studies would be madeLe compare methods of maximizing production under different management systems,e.g. intensive, semi-intensive and range conditions.

ANNEX 6Page 9

Staffing

42. Under the Project, it is planned to increase the MARDI graduatestaff working on the livestock program from the present 13 officers to atotal of 35 by 1980. Also proposed under the project are post-graduatefellowships to train 8 staff to Ph.D degree and 5 to Masters degree levelat overseas Universities and 4 man-years to be spent on short-term fellow-ships at overseas research institutions (a total of 36 man-years).

43. It is proposed that three experienced expatriate scientists wouldbe employed to assist in the initial phases of planning and developing thecattle, pig and poultry programs. These would be assigned to the beef anddairy programs (4 man-years), pig program (3 man-years), and poultry program(2 man-years). Each of these scientists would have his own research programand would not operate solely as an adviser. A provision would also be madefor another (2 man-years) of specialists consultancies to be used as requiredduring the project; this would inclufde a contribution to financing the postof Program Specialist assigned to the Deputy Director for Research Programs.This would provide a total of 18 scientists working in beef cattle, 6 ondairy cattle, 6 on poultry and 5 on pigs.

Land, Building, Equipment, Livestock and Materials

44. All the land required for the Livestock Research Program is nowowned by MARDI at its Serdang, Kluang and Bukit Ridan stations. Animalhouses, yards, pens and ancillary buildings for these centres would beprovided under the Project. The Project would provide for the establish-ment and maintenance of pastures and would also provide for field equip-ment, research equipment and vehicles. A major Project item would be theimportation of a considerable number of foundation breeding stock fromoverseas. The substantial cost of US$1,372,100 is justified since ade-quate quantities of good quality animals are essential as a basis for aneffective breeding program. The Project would also provide stock feedsand veterinary supplies.

Organization and Management

45. The Livestock Research Program would be guided by a Senior Scien-tist (Program Coordinator) responsible to the Assistant Director for Pro-duction Research. The present sub-division of the work into Beef Cattle,Dairy Cattle, Poultry and Pigs research units is appropriate and shouldcontinue. Leaders should be appointed for each of these research sections.

46. The overseas scientists working in the Program would take a lead-ing part in planning, organizing, and developing the research programs, andwould be given leadership responsibilities at the discretion of the MARDIDirectorate, if no suitably qualified MARDI personnel are available. Theoverseas scientists would operate as working scientists with their own re-search programs.

ANNEX 6Page 10

47. Because the research would be carried out at three separatelocations, and the main analytical services of MARDI will be centralized atSerdang, special arrangements would be needed for the preparation and trans-port of experimental samples for analysis. The separation of staff in theBeef Unit would place an additional responsibility of coordination on theUnit leader.

Project Objectives

48. The Project would develop more productive breeds of beef and dairycattle and develop more effective and economical methods of beef and milkproduction. If, by the 1980's cross breeding and improved nutrition canachieve a reasonable target of 100 lbs extra beef per carcass for 25% ofthe annual number of animals now slaughtered, the annual value of the addi-tional product would be M$ 6.4 million.

49. Animal husbandry combined with pasture development research areexpected to achieve increases in animal production from beef breeding/fatteningenterprises of 100 lbs meat/acre/year. On a 30,000 acre area (above the sizeof the present NLDC ranch scheme) the annual value of beef production wouldbe M$ 14.4 million.

50. Substantial increases in milk yields from dairy cattle can beexpected as a result of the research in animal breeding and nutrition to becarried out under the Project. This should lead to a reduction in the presenthigh price of fresh milk and stimulate the expansion of the very small dairyindustry in Malaysia.

51. Intensive research by MARDI into all available feed sources couldachieve substantial import savings since feed costs represent over 70% ofthe cost of production of pig meat and poultry. Already MARDI's research intothe substitution of locally produced for imported feeds has indicated apotential annual saving of M$ 1.4 million for the Malaysia pig industry, andexpansion of this work should multiply this saving many times over. To thismust be added the additional output of pork and chicken meat resulting fromthe breeding of better adapted and more productive stock.

52. The training program would provide Malaysia with a group of welltrained research workers in animal breeding, animal nutrition, and animalhusbandry. These workers would be capable of conducting pioneering researchin a near-equatorial environment where little research in these fields hasbeen done. The value of this training should be reflected for several decadesin the form of continued increases in the output of valuable protein foods.

Cost estimates

53. The estimated cost of all goods and services which would be financedfor the Livestock Research Program are shown in Table 6.1.

April, 1975

85A1Y701 000 6

Lioss.cok -csrh P--cs

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foOl 3. 1975

ANNEX 7Page 1

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

MARDI - Research Program for Agricultural Products Utilization

A. Introduction

1. Agricultural products utilization research is most effectivewhen conducted as an integral part of the total food production and distribu-tion system. Such integration was aimed at by the MARDI Act, which requiredthat the existing Food Technology Research and Development Centre would beabolished and its activities incorporated in EARDI.

2. The Project would achieve this aim by financing the developmentand strengthening of the Agricultural Products Utilization Research Programas an integral part of MARDI's agricultural research activities. It wouldprovide for expatriate scientists, fellowships, equipment and assist infinancing the construction of a quality control laboratory.

3. Tne most obvious areas for farm products utilization research,in direct support of commodity research programs are (i) rice storage andprocessing, (ii) processing of pineapple, and other fruits, (iii) storageand processing of field crops cuch as cassava (tapioca), groundnuts andsoyabeans, (iv) preparation of livestock feeds from rice and fruits by-products and fieldcrop products, (v) processing of meats, (vi) establish-ing standards and quality control criteria, and (vii) sanitation.

4. Properly staffed and equipped, the Agricultural Products Utiliza-tion Program has an important role to play in the Malaysian economy. Thereis an urgent need to improve the rice milling quality and recovery rate, aswell as to utilize the byproducts of rice and other crops. Pineapple is avaluable export crop. With some two million acres of peat soils suitablefor pineapple cultivation, the potential for production is limited only bythe quality and quantity of fruit produced and processed. Pepper, coconutand cassava all have significant potential for local consumption and export.In addition there is a need for production and processing of other fieldcrops and various by-products for livestock feed.

Status of Food Technology Research

5. The agricultural economy of Malaysia has traditionally been basedon production and export of rubber and palm oil, and the production of rice.Domestic production and processing of other food, feed and fibre crops hasreceived very little attention and the country has been heavily dependent

ANNEX 7Page 2

on the import of these agricultural commodities. The government has nowembarked on a program of increased and diversified food production to reduceimports and improve the nutritional standards of the population.

6. Recognizing that food technology had an important role to play inexpanding agriculture production, for domestic consumption as well as forexport, GOM assisted by UNDP and FAO, agreed to establish "The Food Tech-nology Research and Development Center" in January, 1966.

7. The Plan of Operation stipulated that the project would be com-pleted in five years (from November, 1967). It carried a budget ofUS$1,070,200 from the United Nations Special Fund and US$1,170,000 (plusUS$100,800 for local operating expenses) from GOM. In addition, GOM madeadditional funds available for staff and equipment and to meet inflatedcosts of building construction.

8. The objectives of the program were "To assist in establishing andinitially operating a Food Technology Research and Development Center (FTDRC)and four field stations in order to conduct applied research on problems re-lating to handling, storage, processing, and marketing of locally producedfoods and to provide advice and training in these fields to personnel at alllevels from Government and from industry; to improving the standards of theexisting industries and to explore investment opportunities In new food in-dustries for local and export markets".

9. The headquarters and main research facility was located at theFederal Experiment Station in Serdang. Five field operational centershave subsequently been established:

(a) Fruit and Vegetable Processing Station, JohoreBahru.

(b) Fish Processing Station at Kuala Tengganu.

(c) Rice Processing Station at Alor Satar.

(d) Poultry and Egg Processing Station at Mergong.

(e) Fruit and Vegetable Station has been approvedand budgeted for Kuala Kangsar.

10. The Food Technology Research and Development Center was dividedinto 12 sections:

ANNEX 7Page 3

Technological Service

a. Rice Processing g. Food Analysis and Control

b. Fruit & Vegetable Processing h. Food Biochemistry & Nutrition

c. Fish Processing i. Food Microbiology

d. Meat Technology j. Food Engineering

e. Animal Feedstuff k. Food Packaging

f. Cereals & starch 1. Food Marketing

At the end of the UNDP/FAO period assistance, only 5 of the 12 sectionswere headed by qualified professional officers; 2 were in training andfive additional heads of sections were required for (a) rice processing,(b) fruit and vegetable processing, (c) food analysis and control, (d)food engineering, and (e) cereals and starch.

11. Hiring and retaining qualified and in particular experienced staff,has been a continuing problem of the center. The UNDP/FAO provided the cen-ter with overseas fellowships and in-service training, and at the end of theUNDP project assistance in April 1973, the staff consisted of 25 profes-sionals, 11 of whom were on overseas fellowships. Thirty-five graduateswere assigned to the project; 10 resigned during the terms of the proj-ect, including the first co-manager. Up to October 1, 1974 the Director ofthe Food Technology and Development Center was also head of the LivestockResearch Division of MARDI, a most unsatisfactory arrangement.

12. Under its constitution, the Center was established as a servicedivision of the Ministry of Agriculture with a Coordinating Committee toformulate policies and programs of the Division of Food Technology. Mem-bers are the Permanent Secretary of the Ministry of Agriculture and Fish-eries, as Chairman, the Director of MARDI as Deputy Chairman, the Directorof the Food Technology Division as Secretary, Deputy Chairmen of the FishIndustries Authority, the Livestock Corporation, and the Federal Agricul-tural Marketing Authority, and the Directors General of the Division ofFisheries, Veterinary Services, and the Agricultural Division. The lastthree represent project development functions. This Committee meets appro-ximately four times a year. The Chairman, Deputy Chairman, Secretary, andthe representative of the Agricultural Division serve as a Technical Work-ing Committee which has authority to approve line projects.

13. The major recommendations of the UNDP/FAO project Terminal Report,"Food Technology Research and Development Center-Malaysia 1974", were:

ANNEX 7Page 4

(a) Appoint a qualified fulltime director.

(b) Seek international assistance in recruitinga director.

(c) Recruit an expatriate food technologist.

(d) Establish and fill a post for deputydirector.

(e) Fill all research officer vacancies in:

(i) Rice Processing(ii) Fruit and Vegetable Technology(iii) Food Analysis and Control(iv) Food Engineering(v) Cereals and Starch.

(f) Provide more overseas fellowships.

(g) A qualified librarian and an officer for projectdevelopment are required. Documentation and dis-semenation are important activities for the insti-tute.

(h) Other new activities to be considered by theInstitute:

(i) Edible Oil Technology(ii) Dairy Technology(iii) Spice and Beverage Technology.

14. Since the end of the UNDP/FAO project assistance the Food Tech-nology Research and Development Center has been restructured into fivedivisions and 29 sections; and in October 1974 was transferred to MARDIwhere additional re-organization and re-orientation will take place. The5 Divisions, each under a Director are as follows: (i) Food Engineeringand Mechanization Technology, (ii) Processing Technology for Plant Mate-rials, (iii) Processing Technology for Animal Materials, (iv) QualityControl, and (v) Services and Development. However only 17 of the sec-tions have scientifically or technically trained people on their estab-lishment at present. 1

15. There are 22 professional officers, 12 quasi-professional offi-cers, 22 technicians and clerical staff, and 37 laboratory techniciansemployed at the Centre. In addition there are 118 persons employed inthe administrative and other supporting capacities. The total complementof personnel represents only 77% of the approved establishment.

ANNEX 7Page 5

16. A fruit and vegetable processing station at Tampoi (near JohorBahru) became operational in November 1967 in a building taken over fromthe Department of Agriculture's canning section (established in 1938).Nineteen persons are currently employed at this station, and all posts arefilled. Emphasis is on pilot plant product development, demonstrating im-proved methods of drying, canning and handling of fruit products to improveefficiency and quality. At Alor Setar a rice processing station becameoperational in 1971 in temporary and inadequate quarters. A site at BukitRaya, next to a rice milling complex of the National Padi and Rice Board,has been cleared and a new building will be constructed and completed bythe end of 1974. Major efforts are being made on examining various varie-ties of padi for milling recovery, the setting up of rice standards, studieson the method of parboiling of rice and small scale investigations into themethods of drying and storing of padi and rice. A national survey on man-agement and technical efficiency of rice mills is being conducted. Thisstation assists in the training of personnel from the National Padi and RiceBoard.

17. Two additional stations are being developed. The poultry andegg station, at Mergong near Alor Setar, is expected to be operationalby the end of 1974. Four persons are already employed and 15 posts havebeen approved for 1975. The station will study problems of slaughtering,handling, storage, processing and transporting of meat, poultry and eggs.A fruit and vegetable processing station at Kuala Kangsar, northwest ofIpoh has been approved and budgeted. A total of 26 posts are expectedto be established for this station. It is also planned to set up a sta-tion at Kuala Trengganu for fish meal studies. Two stations (in onecomplex) are planned to be established in Pasir Puteh in Kelantan forprocessing animal feeds and vegetable oil.

18. Currently there are 32 line projects on which research is beingconducted. Many of these projects are short term and deal with developmentprograms requested by various government and semi-government agencies viz.the Armed Forces, the National Applied Nutrition Programme, various StateAgricultural Departments, Food Industries of Malaysia, Farmers' Organiza-tions, and State Economic and Development Corporations. Nutrition researchto develop high protein supplements for school feeding and programs for theundernourished is an important component of the present program; researchin this area is intensive and effective. Publication of most of the reportsproduced by the Center are restricted due to the policy of the governmentin giving preference to government and semi-government agencies; duringnegotiations it was agreed that research finding would be made availableto the public and private sector except for reasons of National Security.The Center provides training in the establishment and running of foodprocessing plants to Farmers Organizations and State Economic DevelopmentCorporations. It also provides quality control and other advisory serv-ices to these agencies and the private sector.

ANNEX 7Page 6

19. The Center has good facilities and equipment adequate for mostof its on-going work. However the equipment would need to be supplementedas more staff becomes available and programs are added.

20. The current annual operating budget of M$2.6 million is supple-mented by grants for specific special projects. It provides for all costsfor building and facility maintenance, administration and research at Serdangand at the field stations.

Food Technology in the Malaysian Economy

21. Malaysia has a long history of a rice milling industry, a cassavastarch industry, a soya industry, a palm oil industry, and a pineapple can-ning industry. Today there are more than 25 companies involved in canningvarious seafoods, meat, vegetables, fruits, oils, margarine, condensed andpowered milk, as well as canning and bottling of beverages. The major otherfood processing enterprises are (i) bakeries, (ii) candy, confection andnoodle factories, and (iii) slaughter houses for livestock and poultry.

22. The canned foods produced in 1973 were:

1973 MALAYSIAN CALNNED FOODS PRODUCTION /

No. of Cans Consumption(millions)

Sweetened condensed milk 180 LocalMilk powder and beverages 25 LocalMargarine 8 LocalBeer 5 LocalPineapple 120 ExportTuna 7 ExportPrawns 2 ExportMiscellaneous (Curry, pickles, 31 Local

sambal, baked beans, peas,sweet corn, sardines, etc.)

/1 THE STRAITS TINES, March 20, 1974.

23. Growth rate of the Malaysian canning industry has been slow.The canning of pineapple (the second largest category) has been at astandstill in recent years. Domestic consumption of canned foods (otherthan milk and beverage products) is less than 5 cans per person per year.Slowness in the growth of the canning industry in Malaysia is due toshortages of quality raw material, inconsistency in supply, and lack ofconsumer acceptance. Clearly there is scope for expansion of the localcanning industry.

ANNEX 7Page 7

24. In the proposal for the Second Malaysia Plan, 1971-1975, theportion relating to the Division of Food Technology, Ministry of Agri-culture and Co-Operatives, states, "The gross value as well as thevolume of sale of the food industry in West Malaysia occupies some 70%of the total sales value for all industries, amounting to about M$600million. Although well established, most of the food industries aresmall and cater for the local market only. In the absence of organizedresearch, these small enterprises depend on experience for the productionof food items rather than scientific findings." This appears to describethe industry of 1974.

25. All levels and sizes of operations in the food industry fromthe farmer to the consumer, and from the government industry to the cot-tage industry can and would benefit from integrated food technology re-search and development carried out by MARDI.

B. The Agricultural Products Utilization Research Program

26. This research program introduces into the MARDI establishmentan Institute, albeit in a different format, which has an ongoing programof research, which is directed at linking the producers and consumers ofagricultural products. The Project would assist not only in expanding itsactivities, but more importantly in properly focusing it.

27. It would achieve this through the provision of fellowships, ex-patriate scientists research equipment, and the provision of a Food QualityResearch building.

28. Training is an essential component of the Project and would con-sist of 40 man-years of fellowships for post graduate and 4 man-years forspecialized training.

29. The redirection of product utilization research into a verticallyintegrated program would involve an extension of activities for pineappleprocessing, cassava processing, rice processing, cured meat products aswell as an improvement in sanitation in food processing and food engineer-ing. Additional emphasis would be given to selected projects for the im-provement of products already commercially processed; the effort on newproduct development and packaging would be of lesser priority.

Pineapple Processing

30. There is need for improvements in pineapple processing technology,mainly in problems of development and application of standards. The Programwould include studies on (i) improvement of engineering efficiency; (ii)utilization of waste materials for production of juice, additional pine-apple products, and extraction of bromelin, and (iii) disposal of wasteproducts.

ANNEX 7Page 8

31. Ongoing research on the development of a simple pineapple sizegrading machine would be followed through. Research is being conductedon the utilization of over-ripe fruit for wine and the conversion ofwaste in to flakes for livestock feed; animal feeding trials will becarried out in cooperation with MARDI. These research activities willbe strengthened and expanded under the Project.

Rice Processing

32. Research on rice processing would be concerned with reducinglosses and producing a high quality product. Research beyond the farmlevel would be primarily the responsibility of the program; this wouldinclude control storage, drying, transport, milling, parboiling and theutilization of rice by-products. Some of the research areas would be:

(a) milling deficiencies related to drying andstorage practices

(b) poor pre-milling conditioning and grading

(c) Lack of understanding and application ofstandards

(d) poor quality of locally processed bran

(e) Poor maintenance and utilization of rice mills

(f) Low recovery and poor quality milled rice.

Cassava Products

33. Cassava processing research would aim at expanding the marketfor cassava products in all processed forms: (a) starch, (b) chips,(c) pellets, (d) meal and (e) the utilization of waste for livestockfeed. Problems associated with cassava processing which require con-tinuing research are: (i) location and capacity of plants, (ii) pro-cessing techniques including, quality of water, types of equipment andprocesses, factory layout and sanitary conditions, and (iii) qualitycontrol.

Fish Processing

34. The major requirements for research in the fish processingindustry are (i) improving quality, (ii) sanitation, and (iii) improv-ing processing methods and efficiency. Research also needs to be doneon the utilization of fish by-products for livestock and fish feed.

ANNEX 7Page 9

Meat, Poultry and Eggs

35. Research in this field has only begun and would be strengthenedto support GOM's intention to expand meat production. The development ofthe beef, poultry and egg industry require research in slaughtering tech-niques, meat handling, meat processing, packaging, marketing and hygiene.Some research has been carried out on the processing beef and buffalo meatand pilot production of sausages. This would be continued. The poultryand egg industry would receive special attention with the opening of astation at Mergong by the end of 1974.

Livestock Feed

36. The Agricultural Product Utilization Program would augment thelivestock industry through the development and promotion of a livestockfeed industry. A major problem is the lack of a dependable quality oflivestock feed supply. One of the contributions to the livestock industrywould be made through development of the use of by-products for feed, i.e.,rice bran, cassava and cassava waste, copra waste, palm oil waste, pine-apple waste, fish meal and bone meal.

Food Engineering and Sanitation

37. General research would be undertaken to modernize the food pro-cessing industry, primarily through the selection and development of machinesand methods to make the food industry more efficient. Focus would be on san-itation and sanitation engineering.

Staffing

38. With a staff of 25 professional officers, including 4 staff holdingPhD and 8 staff holding MSc degrees, the Program has the nucleus to build aproductive team of 40 or more research officers by 1980. Further trainingand experience is required in order to provide qualified officers to leadthe divisions, sections and field stations.

Expatriate Scientist

39. The Project would provide 15 man years of expatriate seniorresearch scientists to complement the young and enthusiastic team ofMalaysian professional research officers. Four areas of food technology,in particular, require the assistance of senior scientists; (i) riceprocessing, (ii) fruit and vegetable processing, (iii) quality controland sanitation, and (iv) food engineering. These scientists are estimatedto cost US$900,000 (Table 7.1).

ANNEX 7Page 10

Fellowships and Training

40. Post graduate training of staff would be an important aspect ofthe Project. It would provide 40 man years of fellowships for post grad-uate training to MSc and PhD degrees and short term fellowships for spe-cialized training and study tours. At the end of the project approximately50% of the professional staff of the Agricultural Products Utilization Unitwould have benefited from such advanced training.

Land, Buildings, Equipment and Materials

41. The unit has an excellent building complex at headquarters Serdangwhich was constructed during the term of UNDP/FAO Project and adequate build-ings have been or are being provided at the field stations. Quality controland sanitation are the weakest links-in the food processing industry ofMalaysia; a modest building (costing US$81,600) is still required as a lab-oratory for quality control and sanitation research is urgently required andwould be provided by the project.

42. The project would provide equipment for the quality control andsanitation laboratories and supplement existing equipment to strengthen thefruit and vegetable processing program. Equipment for controlled atmospherestorage research is required for conducting studies in the preservation offresh fruits and vegetables so as to provide a regular fresh market supply.

Cost Estimates

43. The estimated cost of all goods and services which would be fi-nanced for the Agricultural Products Utilization Research Program is shownin Table 7.1.

April, 1975

MALAYSIA

AGRICULTURAL RESEARCH AND KITENSSION PROJECT

AGRICULIURAL PRODUCT UTTLIZATION RESEARCH PROORaM

Cost Estimates - US$ 1000 x 9si-alsnt

ITEMS Year 1 Year 2 Year 3 Year 4 Year` Year 6Years 1-6

Local Foreigh Local Foreign Local Foreign Local Foreign Local Foreign Local Foreign Local Foreign Total

I - SERVICES

i. Expatriate Specialists

Senior Scentio t (Peocessing), 4 MY 9.0 51.0 9.0 51.0 9.0 51.0 9.0 51.0 36.0 204.0 240.0

Rice Processoing and Storage Ri.. Proc.s.i.g .. d SL.L.,:g ~~~~~~ ~~~~~ ~~~~~~~~~~~~~~~~~~~19.0 102.0 120.0

Specialist, 2 MY 9.0 51.0 9.0 51.0

Ouality Control Specialist, 3 MY 9.0 51.0 9.0 51.0 9.0 51.0 27.0 153.0 180.0

Shorlten Cpnaultanta, 3 NlY 4,5 25.5 4.5 25.5 4.5 25.5 4.5 25.5 4.5 25.5 4.5 25.5 27.0 153.0 180.0

Foedproeeesing Engineer, 3 MY 9.0 51.O 9.0 51.0 9.0 51.0 27.0 153.0 190.0

2. Followships

Staff Fello-ships, 44 MY' 0 105.6 0 105.' 0 105.6 0 105.6 0 105.6 0 105.6 0 633.6 633.6

Subtotal I - SEiVICES 22.9 233.1 51.5 264.1 22.5 233.1 3L.5 294.1 13.5 182.1 13.5 192.1 135.0. 1396.4 1133.6

II - 0D0S

1. Buildings

Quality Costrel Laboratory 27.1 13.7 27.1 13.7 54.2 27.4 81.6

2. Vehicles

Truck (1), Pick-up (1), Station-waggon (1) Vans (3) 0 24.1 ° 24.1 0 48.2 48.2

3. Research Equipoent

Fruit Reaearch

GiORac machine (pineapple) 0 10.2 0 90.2 10.2

Rico Storage research 0 20.4 0 20.4 20.4

Starch procesing studies 0 16.3 16.3 19.3

Pepper processing research 0 20.4 0 20.4 20.4

Cocos processing research 0 16.3 0 16.3 16.3

oc p .ilrtP Control

Media equpr.ent 0 74.1 0 74.1 74.1

Inoculators equipment 0 9.4 0 9.4 9.4

necubation eqoipsasnt 0 34.3 0 Z4.3 34.5

Autoclave and acceasories 0 6.5 0 6.3 6.3

Microaealytical facilitios 0 34.3 0 34.3 34.3

Sterilising and washing equipFent 0 14.9

Analytical balance (1) Ashingequipment, chrPmwt-graphy

oquipm6nt, nteriliaig chemicals 26.7 0 26.7 26.7

Other laboratory equipment 0 5323.0Instrumentation 0 204.1 0 204.1 204.1

Controlled Atosaphere Research

Gas diffusion meter and harts 0 40.8 0 40.8 40.5

Hontor colorioeterr (1)

Roitdifitcs (2) 0 20.4 4 20.4 20.4

Astomrtic Control equipenit 0 32.7 0 32.7 32.7

Fruit and Juices Equipment

Thernobreak (1) juice transfer pumps,

tubular ensler 0 19.6 0 19.6 19.6

fille for vics nd sei-visou 10.2 10.2

products 0 10.201.2 12

Vegetable Oils Research

Bleaching and deodorising equipment 0 49.0 0 49.0 49.0

Solvent eotractor, Screw'press expeller 0 244.9 0 244.9 244.9

PS11etiser 0 102.0 0 102.0 102.0

Dewaxing equipment 0 53.1 53.1 53.1

Subtotal !I - GOODS 27.1 64.7 27.1 131.7 0 952.4 0 20.4 54.2 1189.2 1243.4

AGRICULTURAL PRODUCTS UTILISATION 3

RESEARCdi PROGRAM - TOTAL 49.6 317.8 58.6 415.8 22.5 1165.5 31.5 304.5 13.5 182.1 13.5 182.1 189.2 2187.6 2777.0

April 3, 1975

ANNEX 8Page 1

MALAYSIA

AGRICULTUPAL RESEARCH AND EXTENSION PROJECT

MARDI - Research Program for Agricultural Engineering and Water Management

A. Introduction

1. Malaysia has a relatively high land to labor ratio in comparisonto most South East Asia countries. Thus the availability of labor and energycould become a constraint to intensification and extension of agricultureproduction, particularly at the peak planting and harvesting periods (seeChart No. WB 9036 prepared by R. Wijewardene, MARDI/FAO Chart).

2. It is therefore necessary to develop selective mechanization sys-tems to supplement the labor and facilitate increased agricultural produc-tion in these peak periods. Padi has traditionally been cultivated withlabor and draft animals; however the workanimal population is too small tomake a significant contribution to the energy available for paddy produc-tion, and the use of tractors has increased rapidly in recent years.

3. About 75% of the padi land preparation operations (plowing, ro-tavating, harrowing and leveling) in West Ralaysia now makes use of tractors.The tractor population in Malaysia is estimated to be about 8100, 4-wheelunits and 5,000 single-axle (power tiller) units. 1/ The total number of4-wheel tractors used for arable agriculture (primarily rice) appears tobe stabilizing at about 2,100 units; contractors own approximately 1,400of these tractors. It is significant to note that while the demand for4-wheel tractors appears to be leveling off, the demand for single-axletractors is rapidly increasing; 1973 sales are estimated to be about 1,900units and the total number in use is estimated to be 5,000. While 4-wheeltractor sales have tended to level off, the horsepower per unit has risendramatically:

1/ 1972 figures, Department of Agriculture - Note: It has been estimatedthat more than 2,100 of the 4-wheel units and the majority of thesingle axle units are used for rice cultivation. Single axle tractorfigures have been adjusted according to 1973 sales.

ANNEX 8Page 2

Year % less than 40 BHP % over 60 BHP

1965 55 0

1969 14 32

1972 1 81

This trend of increase in horsepower-per-unit is rather alarming because itappears to be associated with the deteriorating flotation and traction con-ditions in the irrigated double cropping system.

4. Moreover, the second crop must be grown and harvested during therainy season when it is difficult to provide adequate drainage and watercontrol. The most difficult field operations are land preparation and har-vesting; also drying and storage of the wet season crop can be extremelydifficult.

5. Conditions observed at the MUDA Irrigation Sclheme are a primeexamiple of the mechanization and water control problem. The MUDA projectis forging ahead in spite of the difficult field conditions. Larger andmore sohpisticated tractors are being used to overcome the traction andflotation problems; but these are only temporary solutions. The use ofconventional track type combine harvesters have been virtually abandonedand the project is experimenting with other harvesting machines.

6. The traditional system of harvesting and storing of padi hasalways been inefficient and wasteful. Increased yields through high yield-ing varieties, fertilizer and irrigation make it essential to introducenew technology for harvesting, drying, storing and handling. The laborpeaks and the problems of harvesting the second crop during the wet seasonare a serious constraint to further intensification and extension of padiproduction.

7. Preservation of grain quality for feed and food have assumiedadded importance in Malaysia as production of feed and food grains increased.Drving to safe storage moisture and mainitenance of dry, clean storage is es-sential for all the crops. Research will need to be- directed towards eco-nomical, effective metliods of drying, hiandling and storing these crops atall levels. Losses fronm the field to thie consumer may exceed 15%. Simple,effective on-farm preservation methods are urgently required.

S. In addition to padi rice, the production of maize, sorghum andsoyabeans and otlher field crops require at least some degree of mechianizationin 'Salaysia. fliis is particularly true in land preparation, planting andharvesting. Timeliness of field operations becomes critical when a crop isincluded in rotations or in a inultiple cropping systen.

9. It is thus apparent that Agricultural Lngineering (mechanizedland preparation, planting, harvesting and storage) are directly related

ANNEX 8Page 3

to water management in modern agriculture. The cultural practices andassociated mechanization applied must be compatible with erosion controlmeasures, drainage and irrigation systems which promote effective andefficient water use as part of an integrated modern farming system.Equipment, tillage practices, planting seasons and harvest seasons mustbe selected to take best advantage of the degree of water control avail-able.

10. Agricultural engineering and water management principles arebeing applied to tropical agriculture through appropriate design on afully integrated crop production basis. The usual adoptive approachof mechanizing each manual operation of rice for example (flooding,plowing, puddling, leveling, weeding, crop cutting, threshing, winnowing,drying and storage) have lead to expensive and sophisticated machineryand systems. Instead a new "integrated systems" approach using allforms of modern technology, from plant breeding to engineering should bedeveloped to produce efficient farming systems, taking into account alsothe social conditions 4n which the farming system takes place.

11. It is with these problems in mind that MARDI is pursuing a re-search program including agricultural engineering and water management.This research will also include the social and economic aspects of tech-nology both in maximizing labor use and production, and in making farmingand farm work more attractive.

Status of Agricultural Engineering and Water Management Research in M4ARDI

12. When MARDI became operational in 1971 the Soil, Water and En-gineering Division was one of the six Divisions in the Institute. WaterManagement and Agricultural Engineering was a branch in that Division.

13. From the very beginning water management and agricultural en-gineering have been grossly neglected and understaffed. Due to organizational,manpower and budgetary limitations the branch has been unable to conduct anadequate research program and supporting services for the commodity researchprograms.

B. The Agricultural Engineering and Water MIanagement Research Program

14. The Agricultural Engineering and Water Management Research Pro-gram would pursue the following objectives:

The development of systems and techniques - in association withthe other crop research programs - for increasing the incomeand productivity of:

(a) the farmer

(b) farm-land

ANNEX 8Page 4

15. These objectives would give rise to the following research:

(a) the development of new, innovative techniques withtools and equipment which can be constructed locallyfor crop husbandry and processing, and through im-proving the efficiency of operation of equipment andservices already used by the farmer.

(b) the development of techniques for increased farm-land productivity such as 'double' and 'multiple'cropping.

(c) the development of techniques for simple on-farmprocessing to increase the value of farm produceleaving the farmers hands.

(d) the development of techniques for coping withparticular padi problem areas and problem soilssuch as peat.

(e) encouraging the development of a healthy local,agricultural machinery industry, and relievingthe farmer of the high margins on importedmachinery and implements.

(f) the development of techniques for processing ofnew crops such as fibres; (cotton, kenaf, jute,etc.) and for utilizing available energies (solar,wind, etc.).

16. Specific lines of research have been developed to provide a clearprogram of work and objectives based on the best current knowledge, and uponwhich to plan personnel and funding requirements. Flexibility is howeveressential to ensure that programs remain topical and current.

17. The Project would finance expatriate engineering scientists,fellowships for training local professional and technical agriculturalengineering staff, the supply of vehicles, laboratory equipment, work-shop equipment, plant equipment, machine shop equipment and testingequipment.

18. This would provide the staff and equipment required to supportthe commodity research programs, carry out essential agricultural engineeringand related water management research, and provide coln7lete workshopsservices for station operation and maintenance at Serdang, Bumbong Limaand Bertam Estate; and workshop supporting services for all other stations.

19. Plans have already been completed for the construction of build-ing (workshops, stores, offices and laboratories) to provide the facilities

ANNEX 8Page 5

at Serdang for the Agricultural Engineering, Water Management and Workshopsprogram. Cost of the entire complex exceeds M$900,000 and it planned to letcontracts in 1974 for the construction of selected buildings costing appro-ximately M$500,000.

20. The main center for Agriculture Engineering and Water Managementwill ultimately be at the Bertam Estate. Some further expansion of work-shop and related office facilities will be required at Serdang during the3rd plan period; however the most essential building construction will berequired at Bertam Estate and is estimated to cost M$455,000. These build-ings should be completed in 1977 to facilitate moving the Program fromSerdang to Bertam when more local professional staff become available in1976.

21. The Agricultural Engineering group in addition to its researchinput will also provide the workshops, facilities and staff to serve theneeds of the other MARDI groups. The organization of a service unit wouldensure career opportunity for all disciplines operating under a commodityoriented research program. This organization will permit each specialistto serve the commodity groups as required and provide maximum mobility andefficiency. Staff will have the opportunity to obtain varied experienceand their performance and career can be assessed and guided by their appro-priate disciplinary service division.

Agricultural Engineering and Water Management in Rice

22. Agricultural engineering and water management research are playingan increasingly important role in reducing the land, labor and machine con-straints for padi production. The problems have become particularly acutewith irrigation and double cropping and the resultant "off-season" harvest.A fully integrated biological and engineering research to developing suitablepadi "farming systems" include the following activities:

Activity No: A-1 4-Wheel Tractor Mobility Studies & Implement Trials:

(a) Mobility Studies

(i) Effect of Water-table control on soil cone-index ofpaddy soils varying in clay content.

(ii) Mobility-limiting cone-indices of tractors and powertillers using various traction aids such as standard-tyres; deep-lug-types; cage-wheels; half-tracks, Dondi-Tracks; etc.

Page ij

(1h) 1:1 Im.plement Studies:

(i) Comparison of costs, time, weed-control, and cropresponse under varving tillage systems using mould-board-plough; disc-plough; Tine-tilling; Rotary-tilling; Disc-tilling (and combinations) towardsevolving the most economic tillage practise for seed-bed preparation.

(c) Tractor-D!arvester Trials:

(i) Trials of rice-harvesting machinery including thestripper harvester, tractor-mounted-harvester etc:for nobility, economy of operation, efficiency, etc.

Activity `'o: A-2 Farm Production Systems:

(a) Power-Tiller-Development

(i) Performance and handling trials of thc I-;RI poowcr-tiller, Landmaster, and developmlent of power-tillerdesign suitable for local (Malaysia) mianufacture.

(ii) Performance trials of the MARDI power-tiller inconjunction with Dent. of Agriculture for extensionpurposes.

(b) Tillage-Implermient Trials

(i) Comparison of costs, time, weed-control, and cropresponse under varying tillage-implement practisestowards identifying "miuiimum toilage" system.

(ii) Design and development of the implements for theMARDI power-tiller which will achieve the objectiveof "minimum-toilage."

(c) Stripper-Harvester Development:

(i) Trials with the 'Poynter" and IRRI stripper-harvestersto establish feasibility for operation under Mialaysianconditions, and adapt the development for operationwith the HARDI power-tiller.

(d) Ultra-low Volume (IJLV) Sprayer Eauipment Trials:

(i) Trials with both the battery driven and engine-powerednLV sprayers for insecticide as well as weedicideanplication in comparison with standard knapsack and;1mist-blower' spray systems (high volume) for ease andeconomics of operation.

ANNEX bPage 7

(e) Fertilizer-Insecticide Applicator Development:

(i) Trials with the IRRI and similar sub-surface fertilizer-insecticide applicators. An appropriate design is beingdeveloped for farmer extension.

(f) Development of "On-farm" facilities for cleaning, drying, storage:

(i) Paddy, harvested at optimum of 20-22% moisture content needscleaning, drying and storage on the farm. Simple equipmentsuitable for use on the farm are being tested and evaluatedfor feasibility within a systems approach, these includedomesticly fabricated equipment for farm drying such assolar driers, desicant driers, heated-air driers etc.

Activity No: A-3 Post Harvest Systems:

Provisions have been made to train personnel for these programs,one in drying systems, and the other in grain storage systems.

Agricultural Engineering and Water Management in Field Crops

23. Agricultural engineering and water management research in supportof the Field Crops Research Program is concerned with field production equip-ment, irrigation and erosion control. Field production mechanization andwater control are directly related to some of the rice program activitiessince field crops will be produced both in rotation with padi and as theprincipal crop. Horticultural crops, because of similarities in mechani-zation requirements are treated basically as part of the field crops activi-ties. Trials would be conducted with trickle irrigation in closely spacedhorticultural and vegetable crops.

24. The 'power-tiller' being developed under rice equipment and forfield crops would have particular benefit for the vegetable farmer, forpreparation of the soil, making up beds, seeding and inter-tillage. Theengineer will need to develop the most appropriate range of tools for thevariety of crops grown.

25. Apart from the potential for Ultra Low Volume (ULV) system forvegetable and horticultural spraying, there is considerable scope forherbicide applications which will carry protection against the possibilityof drift on to the crop being grown. Two such applicators are currentlyunder development, one using a peristaltic pump and the other on the'paint-roller' principle. These appliances could have very important advan-tages for control of weeds whlich is a high cost operation in oineapplegrowing,

26. In addition to the development of equlpmlent for pineapple produc-tion and handling; major eimphasis will be given to the developi:,ent of suitaoi-c

AI4NEX Page 8

cultural practices (including water management) for Deat soils associate.lwith pineapple production.

Activity No: C-1 Development of Implements and Tools for Multiple Cropping:

Development of range of implements for the MARDI 'power-tiller'to enable its adaptation to upland cropping (multiple) croppingsystems, inclusive of implements for ploughing; rotary tillage;rotor-ridging; ridge-breaking, row-seeding, inter cultivation,threshing and cleaning.

Activity No: C-2 Development of Equipment for On-Farm Processing of Tapiocaand Groundnut:

(a) Development of suitable root slicer/chipper/shredder

(b) Development of groundnut thresher and shells

(c) Development of crop drier

Activity No: C-3 Development of Herbicide Applicators:

Two types of applicator are planned for development'

(a) Contact roller type (similar to IRRI design)

(b) Shrouder sprayer type

Activity No: C-4 Development trials with kenaf netting-decorticationequipment and procedure:

Trials with commercially available decorticators will befollowed by the development of a simple low-power decor-ticator for use on small holding operations.

Agricultural Engineering and Water Management in Horticultural Crops

27. Agricultural engineering and water management studies in horti-cultural crops are as follows:

Activity No. D-1 Cocoa and Coconut Handling and Drying:

Laboratory studies followed by pilot plant trials, intosimplified systems of cocoa handling and drying for useon small-holder plantations.

Activity No. D-2 Study into by-products of Coconut Industry - dessicatedcoconut and Coconut Fibre Processing

Activity No. D-3 Development of irrigation systems for horticultural crops

(a) trickle, (b) 'Mini' sprinkler

ANNEX 8Page 9

Activity No. D-4 Development of (horticultural) tillage equipment range tomatch the MARDI power tiller

Activity No. D-5 Development of Pesticide Applicator for weed control inhorticultural crops (e.g. pineapple)

Engineering Activities in Livestock

28. The principal objective of the engineering research in the live-stock research program would be to design and develop structures and facili-ties compatible with Malaysian social, economic and climatic conditions. Inpursuance of this objective the following activities would be undertaken.

Activity No. E-1 Designs for Poultry Structure and Facilities

Activity No. E-2 Designs for Goat/Sheep Structure and Facilities

Activity No. E-3 Designs for Swine Structure and Facilities

Activity No. E-4 Designs for Cattle (dairy) Structure andFacilities

Activity No. E-5 Development and testing of simple equipmentand systems for feed mixing, concentration,storage and delivery

Activity No. E-6 Development of livestock effluent disposaland conversion (methane and manure) systems

Staffing

29. Agricultural Engineering professional staff now consists of oneyoung Malaysian Agricultural Engineer (BSc Agri. Engr. 1973); and 5 non-agricultural engineering graduates temporarily assigned to the Program.Five agriculture diplomates were sent on overseas fellowships for trainingin Agricultural Engineering in 1973, and 5 additional candidates are expectedto be selected for overseas fellowships in 1974/75, ultimately leading to atotal 17 professional agricultural engineers in the Program by 1980.

30. Engineering research and support services are severely limited,and will continue to be unless an immediate input of internationally re-cruited series scientist becomes available. Initially it will be necessaryto appoint an experienced foreign agricultural engineer as Senior Scientist(Program Coordinator). In addition, it will be desirable to contract shortand long term agricultural engineering specialists to assist with commodityand line research programs.

31. A total of 15 man years of internationally recruited expertise(costing US$900,000) will be required by the Agricultural Engineering, WaterManagement and Workshops Services Program; including an internationally

ANNEX 8Page 10

recruited Senior Scientist as head of the program. These engineers will

provide vital support to the commodity research programs, conduct agricul-tural engineering and water management line research programs and provideworkshops services and mechanical support for field research program oper-ations, station operation and station maintenance.

Training and Fellowships

32. The internationally recruited senior scientists will provideon-the-job training for support staff; technicians, mechanics, machinist,draftsman and other skilled craftsman required to support all MARDI pro-grams as well as all station and equipment maintenance and operation.In addition they will provide for training of local counterpart profes-sional officer who will assume responsibility for the program of theunit.

33. MARDI has provided for the training of 7 engineers and watermanagement professional research officers to the BSc level. however addi-tional post graduate training will be required in order to provide theknowledge and experience necessary to execute meaningful research pro-grams. The Project would provide 21 man years of fellowships for trainingand education to MSc and PhD degrees and 3 man years of fellowships wouldprovide for short-term specialized training at overseas universities andresearch institutes.

C. Land, Buildings and Equipment

34. Land is available at the headquarters, Serdang and all fieldstations for implementation of this Program. Most of the projects willbe conducted in collaboration with commodity programs, thus land hasalready been allocated as part of the other programs.

35. Buildings, offices, workshops, laboratories have already been

designed and approved for Serdang; construction is expected to begin in1974. Sufficient funds have been allocated to complete 5 of eight build-ings; the remaining buildings would be provided as part of the Project.

36. The Project would provide for construction of buildings andfacilities at Bertram Estate; and servicing workshops at Parit andTanjong Karang.

37. A large equipment component for workshops, laboratories, andfield equipment would be provided for support to all MARDI programs andfor station maintenance and operation. Some prototype fabricationequipment, construction materials and field equipment are required toconduct engineering research. Water management equipment, field andlaboratory, is required to support commodity programs and to conductbasic and applied research.

ANNEX 8Page 11

Organization and Management

38. The Agricultural Engineering and Water Management Research Pro-gram comprise four main units:

(a) Agricultural Engineering Research

(b) Water Management

(c) Workshop and Pool

(d) Design and Survey

39. The Program would be headed by an internationall recruited seniorresearch scientist to organize, plan and supervise the activities of thefour principal groups. He would be assisted by other expatriate and local'staff.

40. The water management group would be headed by a local professionalofficer and would work in close collaboration with the agricultural engineersand the Department of Irrigation Development (DID). DID would provide mostof the required irrigation expertise. 1

41. The design and survey, and workshops groups would be headed by aninternationally recruited senior scientist and would be responsible for (a)detailing design of prototypes, (b) the fabrication of prototypes, (c) themodification of machines and equipment, (d) detailing designs for stations,and research program land development including irrigation systems, (e)detailed design of farm and station structures and the maintenance andoperation of station and program farm equipment.

42. A foreman would be in charge of (a) service and repair workshops,(b) prototype workshops, and (c) the machinery pool and equipment opera-tions. An agricultural engineer would have overall supervisory responsi-bility for these functions at headquarters and all field stations.

D. Cost Estimates

43. The estimated cost of all goods and services which would be fi-nanced for the Agricultural Engineering and Water Management Research Pro-gram is shown in Table 8.1.

April, 1975

MALAYSIA

'AE3RICULTURAL RESEARCH AND EXTENSION PROJECT

Agricultural Engineering and Water Management Research Progra-

Coat Estimate US8 x 1000 Equtvalent

Year I Year 2 Year 3 Year 4 Year 5 Year 6 Years 1 - 6Legal Foreign Local Fereign Locat Fureien Local Pumeig Lecal Fe-ige Local Foreign LecaI Feure Tete1

I - SERVICES

1. EZpatriate SpecialistsSBnier Agricultural Engineer 5 MY (Year 1, paid by FAO) 9.0 51.0 9.0 51.0 9.0 51.0 9.0 51.0 9.0 51.0 45.0 255.0 300.0Machinery Engineer, 3 MY 9.0 51.0 9.0 51.0 9.0 51.0 27.0 153.0 180.0

Storage and drying Enginner, 3 MY 9.0 51.0 9.0 51.0 9.0 51.0 27.0 153.0 180.0Fare Structuree, 3 MY 9.0 51.0 9.0 51.0 9.0 51.0 27.0 153.0 180.0

Shenttern cInsultancie, I MY 1.5 8.5 1.5 8.5 1.5 8.5 1.5 8.5 1.5 8.5 1.5 8.5 9.0 51.0 60.9

2. Fll1-ehipoStaff FellovshipF, 24 MY 0 57.6 0 57.6 0 57.6 0 57.6 0 57.6 0 57.6 0 345.6 345.6

Subtetal I - SERVICES 10.5 l17.1 57.5 270.1 57.5 270.1 29.5 219.1 10.5 117.1 10.5 117.1 135.0 1110.6 1245.6.

II - GOODS

1. Buildings

Workshhp - Serdang 68.0 34.0 68.0 34.0 136.0 68.0 204.0

Office- - Serdang 32.7 16.3 32.7 16.3 65.4 32.6 98.0

Lhboratory - Bertram 34.6 17.4 34.7 17.3 69.3 34.7 104.0

Workshop - Bertram 27.2 13.6 27.2 13.6 54.4 27.2 81.6W-rkhhp - Fari and Tanjuog Earnig 6.8 3.4 6.8 3.4 13.6 6.8 20.4

2 . Fern Equipment

STall Carm tracturn and implenents 0 5.1 0 5.1 0 5.1 0 5.1 0 20.4 20.475 HP treeter and a.oeciated equipmnnt 0 8.2 0 8.2 0 8.2 0 24.6 24.6Thresher, (5) combine(l) , ther harnesting equipmeet 0 9.0 0 9.0 0 9.0 0 27.0 27.0Drying, niurage, handling equipment 0 13.3 9 6.1 0 6.2 0 6.1 0 31.7 31.7rreF.ere (2), planes (2), ditchers (2), ether

lend development equipment 0 10.2 0 10.2 0 :23.4 20.4

Spare parts, 15% 6.1 5,8 4.3 1.7 1.0 0 18.9 18.9

3. Vehicles

Microbus (4), pick-up, 4-wheeldrive (4),tiailer (4), Truck (1) 0 42.6 0 42.6 0 85.2 85.2Moter cnr (1) 3.2 4.9 3.2 4.9 4.9

Spare paste, 15% 7.1 6,4 0 13.5 13.5

4. Laboeatory Equipmn..t

Electronic ar-ing equipment 0 16.3 0 16.3 16.3

Phetegraphir and viauel aid equipment 0 2.2 0 2.2 2.2Farn Prodacte Proesnuing 0 7.2 0 7.3 0 14.5 14.5Hydr-graphic, vater gaugieg aqaipurnt, pumpe,Flownetero, inCiltroetersr, irrigatien sprapy, ete. 0 12.2 0 7.2 0 7.2 0 26.6 2686W.aUrkhohP Equipment

Ferm mechinery servicing equipment 0 12.2 0 12.3 0 24.5 24.5Vehicle Servicing Equipment 0 12.2 0 12,3 0 24.5 24,5Diesct eqaipment 0 12.2 0 7.3 0 19.5 19.5Hand turls and inotrumennt 0 8.2 0 8.2 0 8.2 0 24.6 24.6Stesee and supplies 0 6.1 0 6.1 0 6.1 0 18.3 18.3Machine tuols 0 20.4 0 10.4 0 10.4 0 41.2 41.2

6. Other

Design OfficeDrafting equipment 0 4.3 0 4.3 4,3

Blueprint xeproduction equipment 0 8.1 0 8.1 8.1

Field Egqipment

Survepey-' equip ent 0 2.0 0 2,1 0 4.1 4.1

Protetype Fabsicntien end tenting

Tenting nquipment 0 6.8 0 6.8 0 6.8 0 20.4 20.4

Materials and components for prototype,cun-tructi-n and testing 0 13.6 0 13.6 0 13.6 0 13.6 0 13,6 0 13.6 0 81.6 81.6

Bubtotal II - G0OOD0 103.9§- 270.14 169.3 290.2 68.7 139, 0 33, °0 19.70

AGRICULTURAL ENGINEERING RESEARCH PROGRAM - TOTAL 114.4 387.5 206.8 560.3 106.2 38E,.5 28.5 25.h 10.5 136.8 10.5 130.7 476.9 1857.2 2334.1

April 3, 1975

MALAYSIAAGRICULTURAL RESEARCH AND EXTENSION PROJECT

Increasing Small Rice - Farmer ProductivityThrough Appropriate Mechanization

300

LII TRADITIONAL

SYSTEMS MECHANIZATION

200 o F-rg .2n50F < WE, L ,0.-.,.,:2

i:: [~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~u

LU~~~~~~~~~~~~~~~U0 Hw

200 F_~~~~~~~

ELw cn~~~~

<CT. 150V DECIJAN. FEB.MAR.

eW 0

LU~~~~~~~~~~~~~~~~~~~L

4 W~~~~~<<

0 <~~~~c LLI~~~~~~~~

100 I W

_j n . I

50~~~~~~~~~~~

LLLThis chart illustrates the peak labour involvement, in man-hours-per-ten-dayperiod on a typical three-acre farm in Malaysia farmed traditionally; asvvell as the realistic levels to vvhich this involvement might be reduced and spreadover the growing cycle through appropriate mechanization.

World Ban k-9036(R)

ANNEX 9Page 1

ALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

MARDI - Project Development Unit

A. Introduction

1. The MARDI Act specifies MPARDI's responsibilities for disseminatingits research findings to the extension services, for maintaining liaison withother organizations whose activities are relevant to its programs, and forsociological research relevant to agriculture. The Project Development Unitis responsible for these activities in MARDI, including regional verficationtrials to provide information on local adaptation of research findings forthe extension service and also to define local problems that may need furtherresearch.

2. It is recognized by both MARDI and the Federal Department of Agri-culture that effective mechanisms for liaison between research and extensionare essential if the benefits of agricultural research are to flow quicklyand effectively to the farming community. The establishment of formalextension liaison links has been proposed by the Department of Agriculture,and both parties recognize the need to ensure maximum contact and interactionbetween the research and extension services. With positive encouragement,the existing links should develop into detailed and fruitful cooperation.

Present Status of Development Unit

3. Unlike some of the research units in MARDI, the Project Develop-ment Unit did not take over an existing function of the Department ofAgriculture. Thus a completely new team has had to be established since1971 which, by mid-1974, had recruited a total of nine graduate officers.Effort so far has been concentrated mainly on setting up effective fieldverification teams with six of the graduates being employed on the fieldverification program. To date these have operated exclusively in cropdevelopment, because the livestock program has not yet produced a signi-ficant flow of information for regional evaluation.

Regional Evaluation Program

4. In 1973 the Unit conducted 25 field verification trials at 38sites in the States of Kedah, Kelantan, Trengganu, Selangor, Malacca andJohore. The two principal crops studied were rice and groundnuts, but aconsiderable range of other field crops, fruit crops, vegetable and tree

ANNEX 9

Page 2

crops were included in the program. The leader of the Project DevelopmentUnit holds a PhD degree in extension, which should facilitate the developmentof regional evaluation programs.

5. Because this activity represents a vital link between the .LA@RDIresearch program and the extension services of other agencies, mIost of thesefield evaluation studies have been conducted in co-operation with theDepartments of Agriculture and Farmers' Associations. The Project Develop-ment Unit in MARDI is fully aware of the need to forge strong links withthe extension services in the Departments of Agriculture at both the Federaland State levels, and of tihe advantages of positive collaboration in theconduct of field verification trials.

Information Section

6. No staff has yet been appointed to the Information Section of theProject Development 'Jnit but the need to have this Section fully operationalas quickly as possible is fully appreciated. The Section would provideinformation on MARDI research findings to extension agencies through themedia of seminars, lectures and workshops at the Institute's headquartersand regional stations. So far, the activity undertaken in this area hasbeen done by '!ARDI research workers on an ad 'noc basis. Tt is plannedthat they would continue to be fully involved in future extension liaisonactivities through the Information Section. The Section's staff would beincreased progressively to enable it to cope with the increasing flow ofresearch results. The Section would also be resDonsible for publishing .ARDIresearch findings iTn a rorm suitable for use bv extension workers.

Sociological Studies

7. Work has now commenced on rural sociological studies within theProject Development Unit. Three B.Sc. graduates have been recruited, butto date no surveys have been completed. Rural sociological activity isone of the areas where the interests of the Federal Department of Agri-culture and of MARDI converge. The Department of Agriculture, with itsresponsibility for the extension services, has a direct concern withsociological investigations into various aspects of farmer acceptanceof new agricultural technology. It is logical that the Department shouldcontinue to concentrate on this aspect of sociology, while the MARDI groupwould cover broader aspects such as the impact of technology on socialstructure, and the interaction between social change and the Institute'sresearch programs. Current studies involve topics such as mechanizationand employment and rural income distribution. The studies are of particularimportance in the endeavour to improve the lot of Msalaysia's small farmers.

ANNEX 9Page 3

B. The Project Development Unit

Description

8. The Project would substantially aid the expansion of MARDI'sProject Development Unit during its formative phase. Funds would beprovided for some experienced overseas personnel to assist in programplanning and development, for 24 man-years of fellowships for post-graduatetraining of MARDI staff, and for equipment and materials needed to supportthe Unit's activities.

Staffing

9. Regional Evaluation Studies: Under the Project it is planned toexpand the present program of crop evaluation/verification studies toinclude similar studies on the evaluation of livestock and freshwaterfishery findings. This expansion would require ten additional graduatestaff, plus supporting technical and field staff. It is planned that anumber of these regional evaluation studies would be carried out in EastMalaysia with the collaboration of the Sarawak and Sabah Departments ofAgriculture, after agreements to that effect have been r&ached between theFederal and State Governments concerned.

10. Information Section: Six graduate officers would be recruited toset up the Information section which would be responsible for organizingregular programs of workshops, Lectures and seminars in collaboration withMARDI research workers. The Section would also prepare a variety ofmaterial for use by extension specialists and field extension workers.

11. Rural Sociology: The present team of three rural sociologygraduates would be expanded to six. This would provide adequate strengthin this group which will be giving important guidance to MARDI managementon social change which would be taken into account in deciding the priorityand emphasis in MARDI's research programs. An internationally recruitedsenior research specialist in rural sociology would be recruited for threeyears. He would advise and assist in program planning and execution duringthe critical formative phase when two or three of the local staff would beoverseas for post graduate training.

12. Technical Assistance: The Project would provide two interna-tionally recruited research specialists durino the first three years ofimplementation. One would be a senior scientist who could assist thlesenior MTARDI personnel in planning the scope and operations of the Unit,and the second would be the rural sociologist mentioned above. An addi-tional 12 man-months of expatriate time would also be provided to allowfor short-term assistance in specific aspects of the program.

ANNEX 9Page 4

13. Overseas Fellowships: A total of 24 man-years of fellowshipfunds has been included to provide for overseas post-graduate training forMARDI officers. This would be available for training at either the MSc. orPhD levels at the Institute's discretion. In addition, flnds would beprovided for 36 man-months to be spent by MARDI staff in short-term trainingvisits to overseas institutions.

Land and Buildings

14. No land purchases would be required for the Project DevelopmentUnit, and the buildings already approved for MARDI would be adequate for theUnit's activities.

Equipment and Materials

15. It is proposed to provide under the Project equipment to a totalvalue of US$292,800. Most of this is for the purchase of vehicles toservice the Project r velopment Unit's program of regional verification ofresearch results. This covers 17 vehicles for use in Peninsular Malaysiaand 15 for use in Sarawak and Sabah after 1977. Also printing equipmentwill be needed for preparing printed material for use in extension liaison,and by the extension agencies. Fertilizer to be used in crop and livestockverification projects at a large number of sites in both Peninsular Malaysiaand in Sarawak and Sabah and minor equipment needs would be provided bythe Project.

Organiation and Management

16. The Project Development Unit would operate as one of the Unitsresponsible to the Assistant Director for Research Services.

17. The two international scientists would be expected to contributesignificantly to overall planning and evaluation of the Unit's activities,and in the planning and implementation of sociological studies. This wouldhave particular value early in the project when a considerable proportionof the present MARDI staff would be overseas on post-graduate study. Thevisiting scientists would have individual work programs, and will not actsolely as advisers.

18. It is important that the roles of MARDI on the,one hand and theAgricultural and Veterinary Departments and other agencies with extensionresponsibilities on the other should be clearly defined. Research isMARDI's function, but regional verification would be a joint activityinvolving both MARDI and the extension agencies. Verification at thedistrict level is the responsibility of the extension agencies, and MARDIwould not compete with the agencies at this level. Both MA4RDI and theextension agencies are concerned with different aspects of tCe trainingcf extension -oorlkers, while the agencies are concerned wit- lnvestigationsinto the effectiveness ol extension methods,

ANNEX 9Page 5

19. To promote efficiency of operations of this research-extensioninterface, an Extension-Liaison Committee would be set up to establisheffective links between research and extension, and to define and co-ordinate the activities of iMARDI and the extension agencies in areas ofmutual concern. This committee would have senior representatives fromM4ARDI, the Department of Agriculture and the Veterinary Department, RISDA,FELDA, RRIM, FOA and YIPIB. Where appropriate, sub-committees would beset up to deal with extension for the main crop and livestock activities.

Project Objectives

20. Through its impact on the effective transfer of results fromresearch to extension and of field problems from extension to research,the Unit would have a profound effect on the value of all MARDI research.The achievement of all benefits expected to flow from this Project wouldtherefore be substantially dependent upon the effectiveness of the ProjectDevelopment Unit.

21. Implementation of the proposals would accelerate the developmentof an effective extension-liaison group within 'MARDI staffed by a well-trained group of extension and information specialists and rural sociolo-gists.

22. By facilitating the expansion of Project Development activitiesto service the States of Sabah and Sarawak, the project would developcloser ties between agricultural research and extension activities inthese States and Peninsular M1alaysia. 1/ This would be of considerableadvantacve to Sarawak and Sabah as it would enable the growing resources of'IARDI to be brought to bear on their agricultural problems.

Cost Estimates

23. The estimated cost of all goods and services whiich would befinanced for the Project Development 1nit is shown in Table 9.1.

April, 1975

1/ It is expected that this extension into Sabah and Sarawak would beeffected by 1977, after agreement between the Federal and State Govern-ments !have been reached.

MALAYSIA

AGRICULTvRAL RESEARCH 4ND EXTENSION PROJECT

Project DeveloPomnt Unit

Cost Estimate U8 x 1000 Euvivaeont

ITEM Year I Yeor 2 Year 3 Year 4 Year 5 Year 6 Yea. 1-6Local Foreign Local Forein Local Foreign Loca Forsign Local Forisn Local Forcisn Local Foreign Tot-l

I- Sl'RVICES

S. NlRo7 trj.atce ecEOS IntoS-bi- Spcialiat, 3 MY 9.0 51.0 9.0 51.0 9.0 51.0 27.0 153.0 180.0R-ral S-i.ologit, 3 MY 9.0 51.0 9.0 51.0 9.0 51.0 27.0 153.0 180.0Sbortterm CIocultoocion, 1 MY 1.5 8.5 1.5 8.5 1.5 8.5- 1.5 8.5 1.5 8.5 1.5 8.5 9.0 51.0 60.0

7. Ccl Iaa,htps_2.

Stuff Fe11o5-hipa, 24 MY 0 57.6 0 57.6 0 57.6 0 57.6 0 57.6 0 57.6 0 345.6 345.6

Subtotul T - SERVICES 19,5 168.1 19.5 168.1 19P5 168.1 1.5 66.1 1.5 66.1 1.5 66.1 63.0 702.6 765.6

II - GODSS

1. Fertiliaert

UrSa, 78 to- @ M1 700/ton 0.4 3.7 0.4 3.7 0.4 3.7 0.4 3.7 0.4 3.7 0.4 3.7 2.4 22.2 24.6Phouph.te, 27 t.oc ( MS 500/ton 0.1 1.0 0.1 1.0 0.1 1.0 0.1 1,0 0.1 1.0 0.1 1.0 0.6 6.0 6.6P.at-h, 34 tona L M$ 400/ton, Lie,

T-ac- ElSment. 0.2 1.9 0.2 1.9 0.2 1.9 0.2 1.9 0.2 1.9 0.2 1.9 1.2 11.4 12.6PrutSatdci , oboaelloneouo ahenicalo 0.2 2,0 0.2 2.0 0.2 2.0 0.2 2.0 - 0.2 2.0 0.2 2.0 1.2 12.0 13.2

2. Vehicl

4 W-drive (32) 0 45.7 0 45.7 0 45.7 0 39.2 0 32.7 0 209.0 209.0Spar.p-rto, 15% 0 6.9 0 6.9 0 6.9 0 5.9 0 4.9 0 31.5 31.5

3. Re-oa-h_ Equipaent

Wlcighlog -ahI-es (24) 0 14.7 0 14.7 14.7Soiltoat kito (22), P.akett

Calculatars (22) C-r.to (22)Vlaaal a Ida (10) Film paojoato-a(6) 0 19.6 0 19.6 19.6III cetiuralecors KEqabi-aat 0 3.0 0 3.0 0 3.0 0 3.0 0 3.0 0 3.0 0 18.0 18.0

.,btwalJ LI COSDS 0.9 11.6 0.9 98.5 0.9 64.2 0.9 64.2 0.9 56.7 0.9 49.2 5.4 344.4 349.8

PROJECI D1RR.VJ. RPMNT PS0RRE TOTA20 4 1720.4 0.4 266.6 20.4 231.3 2.4 130.3 2.4 .122.8- 2.4 115.3 66.4 1047.0 1115.4

April 3, 1975

ANNEX 10Page 1

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

MARDI - Central Services

Introduction

1. IMARDI plans to provide central services for analytical chemistry,computing activies and library services, but for various reasons associatedwith staff, accommodation, and financial shortages, these have not yet beenestablished. Now that the quantum of research activity is rapidly increasing,it is important that these services should be set up and equipped as soonas possible. The Project would provide some major items of basic equipmentfor analytical chemnistry, and strong support in equipment and material forthe establishment and development of the library. The Project would alsoprovide a computer system to be shared by MARDI and the Department ofAgriculture but a detailed study wiil be conducted before equipment andcosts are defined.

In addition central workshop facilities for all of IMARDI's research groupswould be provided by the Agricultural Engineering and Water ManagementResearch Program. (Details in A,nnex 8).

Equipment for Central Analytical Laboratory

2. The various MARDI research programs will generate very largenumbers of plant, soil and "animal" (feeds and faeces) samples requiringchemical analysis. It is expected that when MARDI is fully developed, atotal of 300,000 to 400,000 element determinations would be required eachyear. MARDI plans to handle this large analytical load at a CentralAnalytical Laboratory using labor saving and accurate modern instruments,such as the atomic absorption spectrophotometer and an auto-analyzer.

3. In order to ensure that adequate up-to-date equipment is avail-able so that the Central Analytical Laboratory can become fully operativeat an early stage, the Project would finance several of the key items. Thefirst basic items needed would be an Auto-analyzer with block digester andan atomic absorption spectrophotometer.

4. This equipment would provide routine analysi- for the individualelements of most common interest in plant, soil and animal research, e.g.,in the case plant analysis, total nitrogen, phosphorus, potassium, calciumand a range of trace elements. Special analysis such as those requiredto determine particular forms of nitrogen or phosphorus would be theresponsibility of the section concerned, and would not be offered by theCentral Service.

ANNEX 10Page 2

5. In many cases, MARDI scientists would be interested in the levelsof a broad spectrum of elements in their experimental materials, particu-larly where new crops or new areas are concerned. In these cases, aninstrument capable of providing a rapid scanning of a wide range of ele-ments is more suitable than the standard procedures for single or smallnumbers of elements. To do this work an emission spectometer system wouldbe required - e.g., the ARL Quantometer which is capable of scanning, reading,and printing out the levels of 20 elements in one minute. This system alsoprovides a rapid method for sulphur determination. Quantometer instrumentsin use in agricultural research laboratories in both USA and Australia haveproven to be an invaluable aid in commodity-oriented research programs.

6. The Project would provide MARDI with an emission spectrometer(ARL Quantometer or similar system). The purchase would be phased for thethird year of the Project so that the standard instrumentation for the CentralAnalytical Laboratory could first be set up and the necessary standards forcalibrating the emission spectrometer could be established.

Computer System for MARDI and Federal Department of Agriculture

7. Computer services are standard in all agricultural researchinstitutions in the 1970's, and even at this early stage of development MARDIis already hiring eight hours of computer time a week. Usage is at presentrestricted by the small number of scientists in MARDI who have sufficientlyadvanced training to enable them to use computers. With the planned largeincrease in graduate staff over the next six years, and the large post-graduatetraining program which would be supported by the Project, MARDI would requirea medium sized computer installation. MARDI would not share computing re-search facilities with the University of Agriculture at Serdang, becauseexperience elsewhere has demonstrated the severe difficulties which wouldarise when facilities shared between institutions with similar requirementscome under pressure. Moreover, a computer at the University would be usedfor teaching and training purposes which would restrict MARDI's access tosuch computer facilities to an unacceptable degree.

8. On the other hand, sharing with the Department of Agriculture wouldbe feasible, provided that the equipment installed had adequate capacity.The major need of the Department is for data storage and retrieval, partic-ularly for its major soil classification work which is largely non-competitivewith the research requirement which is mainly for the calculation of datanormally stored elsewhere.

9. The selection of equipment to serve the future needs of MARDI andthe Department of Agriculture requires the advice of persons with-a thoroughknowledge of modeii equipment, and skilled in the use of computers for thespecific purposes envisaged by MARDI and the Department of Agriculture.The Project would finance a study by suitable consultants acceptable tothe Bank to survey the need of MARDI and the Department of Agriculture anddefine appropriate systems and equipment to meet them. The study would in

ANNEX I10Page 3

particular assess the adequacy of existing transmissions facilities. Thecost of such a study is estimated At US$20,000. Until the study is completed,it would be impossible to estimate the cost of a suitable computer. Theestimate of $1.5 million shown in Table 10.1 is purely notional until thestudy has been completed.

Library Equipment and Mlaterials

10. At present, MARDi has virtually no library and borrows its materialsfrom other agricultural libraries. This is most inefficient and restrictingfor a major scientific institution.

11. A library area of 10,000 square feet is provided in the newbuilding complex at Serdang scheduled for completion late in 1975, butuntil it is properly stocked and equipped, the library will not be ableto function effectively. The Project would provide funds to obtain backissues over the last 10 years of approximately 100 of the key journals inagricultural and related sciences, plus a basic reference library of 4,000books to back up the diverse MARDI programs. The Project would also coversubscriptions to 800 current journals for a five-year period, and theprovision of some photocopying, microfilm, and microfile equipment.

Cost Estimates

12. The estimated cost of all goods and services (other than CentralWorkshop facilities) which would be financed for central services, is shownin Table 10.1.

April, 1975

4ALAYSIA

AGRICDLT'URAL RESEARCH AND EXTENSION PROJECT

C.otral Facilities

Coat Eatinota US6 a 1000 Eaoiv-l-nt

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Ye.ro I - 6

rI'ndu,H LocalI Foreign Local Foreign Local oign LooI Foreign Local Foroigo Lo..l Foreign L l Frign otal

I GOODS

Lib-rry

Deference libr-ry of 4000 texto @ 6 25 0 50.0 0 25.0 0 25.0 0 100.0 l0o.o-uch nmbero of 100 -elected -ciontific jouroal.

for 10 y lroc 1500 Volumoc @530 (Pr-t cotnicrofilo) 0 15.0 0 15.0 0 15.0 0 45.0 45.0

Subscriptio- to 800 current jouroalJ @$75 per

yoar for 6 y-ero 0 60.0 0 60.0 0 60.0 0 60.0 0 60.0 0 60.0 0 360.0 360.0

Pbotocopyiog, mcr'ofilming and tioroiiloh-nd other librory oqOipm,nt 0 15.0 0 30.0 0 45.0 45.0

Ce-trol A-olyticol Lbhorotory

Auto aooly-or, bltx adigeter 0 19.3 0 19.3 19.3

Aborebtion cpLctrophoto. eter 0 22.2 0 22.2 22.2

EDosolon Spectroreter 0 250.0 0 250.0 25o.o

Consultants for complter rolutremecta study(rotroactioc floanclng) 0 20.0°200 00

1' r t-fi.i9 0 20.0 0 0O 120.0

Computer - 0 750.0 0 750.0 0 1500.0 500.0

0 179.3 0 902.2 0 1100.0 0 60.0 0 60.0 0 60.0 0 2361.5 2361.5

/' rerovsional for - tiroting purpoDc only. To bh -- eoded in doe coor- g in light of oo..oltent' ficdion5.

April 3. 1975

ANNEX 11Page 1

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

Department of Agriculture - Extension-Liaison Unit

A. Introduction

1. Strengthening of Malaysian extension services is essential tobuilding up its agricultural production capacity particularly in the smallfarmer sector. Extension is an essential element to promote the flow ofresearch results to the farmer, particularly the small farmer who wouldnot normally have access to new technology. The reverse also holds; a goodextension service will provide the feed back mechanism from the farmers tothe researchers.

2. In Malaysia, the Federal and State Departments,of Agriculture andthe Veterinary Department are responsible for most extension at the farmerlevel . Annex 1 outlines the relationships between the State and FederalDepartments, and also the problems of the extension services within theseDepartments. These services lack adequate strength and training at thefield level, and do not have groups capable of establishing the requiredlinks with MARDI, or of processing MARDI and other research informationinto forms suitable for extension at the local level.

3. These deficiencies are acknowledged by both the Departments ofAgriculture and the Economic Planning Unit (EPU) of the Malaysian PrimeMinister's Department. They have requested that the establishment of anExtension-Liaison Unit in the Federal Department of Agriculture and RuralDevelopment be included in this Project, as the first step in strengtheningthe capacity of the Department to disseminate information, to improve in-service training, and to forge stronger links with MARDI and other researchand extension authorities in Malaysia.

4. They further requested that provision be made for a comprehensivestudy of extension in Malaysia with the objective of formulating a nationalplan for the upgrading of Malaysia's extension services. This plan wouldbe submitted for possible funding under a future Bank Project.

Present Scope and Functions of the Federal Department of Agriculture

5. The Department of Agriculture has a Director General, two DeputyDirectors-General and seven service or technical branches each with itsown director as follows: (i) Planning and Evaluation, (ii) Crop Produc-tion, (iii) Crop Protection, (iv) Soil and Analytical Services, (v) FarmMechanization, (vi) Education and Training and (vii) Extension.

ANNEX 11Page 2

6. The Department's main role today is as a central service, datacollection, and advisory agency to other Departments operating in theagricultural sector. In association with its data collection and servicefunctions, the Department also undertakes some studies of economic andsocial aspects of agricultural production and development. One of itsmain extension-associated activities is carrying out field trials incollaboration with the extension services of t'he State Departments ofAgriculture, to test and adapt new crop technology to local conditions.

7. The Department has a role in agricultural education. It isresponsible for the five Institutes of Agriculture in West Malaysiaawarding Certificates in Agriculture. These Institutes train the fieldextension staff employed by the State and Federal extension services.The Department also carries out a considerable volume of lower-level edu-cation through local schools and courses for farmers and rural youth.

8. In the regulatory field, the Department is responsible forsetting, administering and policing the standards applicable to fertili-zers, pesticides and seeds. It is also responsible for plant quarantinematters. The collection and publication of agricultural statistics isone of its more important services to other government agencies and tocommerce.

9. One important area of study still being carried out by theDepartment of Agriculture is its soil survey and land use classificationwork. These studies lead to soil and crop suitability classificationswhich are valuable to farmers and extension workers. This soils work isof a high standard and because of its immediate connection with fieldextension, there are strong reasons for its retention within the Depart--nent, rather than handing it over to MAI0I.

10. Each of the technical branches of the Department has extension-oriented functions which are channeled and implemented thirough the StateDepartments of Agriculture. The Federal Department's Extension andAdvisorv Branch co-ordinate these activities.

Extension Service of the State Departments of Agriculture

11. Thle extension services have mainly relied on informal contactsbetween field officers and farmers to educate and influence producers toadopt improved practices in crop and livestock production, managementand marketing. Recently, recognition of the critical pro'blem presentedbv lack of management skills in the farming community has led to awidening of the activities of the Federal Extension Branch to enable itto assume the role of a management agency by:

(a) providing management expertise to existing farmerorganizations

(b) promoting group efforts by individual farmers inobtaining new technology and services

AlNNEX 11Page 3

(c) teaching farmers modern management methods for farms andfarmer organizations.

12. The Federal Extension Service supports the State Departments ofAgriculture by supervising and co-ordinating State extension services.The Chief Agricultural Officer in each State is a member of the FederalService. It also provides funds, personnel and material assistance,trains personnel for the States, and supplies technical information fortheir use. To perform these functions the Federal Extension Service isorganized into seven units:

(i) Communication and information

(ii) Farmer development

(iii) Development of farm families

(iv) Rural youth development

(v) Farm management

(vi) Public relations and special projects

(vii) Coconut replanting and rehabilitation

B. The Extension-Liaison Unit

Description

13. The Project would be the first phase in upgrading llalaysianextension services. It would establish an Extension-Liaison Unit withinthe Extension Branch of Federal Department of Agriculture to promote theeffective transfer of 9AJRDI research findings to the Department andtheir subsequent dissemination to the State extension services. The Unitwould have the training of field extension workers as a major responsi-bility. The Project would provide: (i) buildings and facilities(ii) expatriate expertise to assist in planning and implementing the pro-gram and (iii) fellowships to provide post-graduate training for theUnit's staff.

Detailed Features

14. The Extension-Liaison Unit would be established within theDepartment's Extension Services Branch and would be headed by an AssistantDirector. It would be organized into four separate groups dealing with?'rojects, Communications, Data Processing and a specialized Subject HviatterSection. The Unit would be staffed by 18 graduate officers supported by 46technical and administrative staff. These groups and their responsibilitiesare shown in Chart WB 9155.

AiNEX I1lPage 4

15. The Projects Section would be responsible for formulating develop-ment projects and for conducting pilot project studies. In these activi-ties it would establish close collaboration with the Project DevelopmentUnit in MARDI to capitalize on the opportunities for collaborative workbetween the two organizations. The Section would also carry the evaluationprocess forwarded through the Department's own trials at the district level.In addition, the Projects Section would study farm management extension andwould be organized to take account of rural family and community structures.

16. Close liaison with the relevant officers in MARDI would also beestablished by the Subject Matter Section Group. Their function would be tocollect information on crop production, soils, crop protection, farmmechanization and farm management, for application at the district level,and to convert it to a form suitable for use by extension personnel andfarmers.

17. The Communications Section would be concerned with developingmedia and materials in a form suitable for teaching farmers. It has beena serious weakness that much of the existing literature is designed forthe consumption of extension personnel rather than the farming community.It is essential that effective material and procedures for farmer extensionbe designed and used. The Communications Section would 'also have theimportant responsibility of training extension workers.

18. The Data Processing Section would have a support function in rela-tion to the other groups in the Unit by collecting, processing and report-ing on agricultural statistics of concern to them. It will also have awider function in the efficient collection processing and evaluation ofagricultural data useful to other groups in the Department of Agriculture,other government agencies, and commercial institutions.

19. The essential link between the Department's Extension-LiaisonUnit and MARDI would require close attention by both organizations toensure the effective transfer of information, both from research to exten-sion and from extension to research. A committee structure would bedesirable to assist this process, and collaborative work by officers ofthe two organizations, particularly in the area of regional verificationof research findings, should be a key activity of the Unit. Some links ofthis nature have already been forged, and their promotion would befacilitated by the Project.

Technical Assistance

20. Internationally recruited experts would be required for planningand implementation of the project and have been requested by GOIM. The person-nel required would have experience in broad areas of extension planning andimplementation, Familiarity with local problems would also be an advan-tage.

ANNEX 1 1

Page 5

21. The Projects would finance the services of an extension specialistfor one year at the commencement of the Project to assist the unit in overallplanning. He would also assist the Department of Aariculture in preparinga comprehensive national Agriculture Extension Project for possible Bankparticipation. Eight more man-years of expertise would become availableunder the Project. It is visualized that the phasing of service should beleft flexible so that an individual consultant could serve from one up tofour years in the Unit. The areas where this expertise would be requiredare: (a) crop production/protection; (b) soil/agricultural mechanization;and (c) farm management/home economics. The total cost of these specialistservices would be US$540,000.

Fellowships

22. Because of the extreme shortage of graduate personnel withadequate training in extension, and the lack of graduate and post-graduate training for Departmental officers in various aspects of exten-sion, funds would also be provided for training courses for State and Federalfield officers.

Officers both in the existing Departmenit of Agriculture and the proposednew Extension-Liaison Unit would be selected for these fellowships. lecost to the Project for these fellowships would be US$1,353,600.

C. Land, Building and Equipment

Land

23. The land required for the new headquarters building would beprovided by GOM.

Building

24. The Project would finance the construction of a central head-quarters for the Unit. The headquarters would have administrative/instructional and accommodation facilities, specialized audio-visualcommunication facilities, a conference room, a library, a documentationfacility and space for recreation.

25. The headquarters would be in Kuala Lumpur at the main Departmentof Agriculture site where it would have close contact with the Depart-ment's existing branches. The cost of additional buildings for the Pro-ject would be US$1,496,000.

Equipment

26. The new Unit would have a substantial need for equipmentboth to set up the headquarters building as a teaching center and to

ANNEX 1 1Page 6

provide basic equipment for the Unit's training, demonstration andextension activities in the States. The total cost for materials andequipment under the Project would be US$603,000.

27. Computer: The Department of Agriculture urgently needs com-puter facilities to support its extension and agricultural service func-tions, as well as its soil survey data. The computing service in theDepartment would be operated by the Data Processing Unit in the Agricul-tural Extension Center to serve the following functions:

(a) Storage and retrieval of agricultural data geared to extensionwork;

(b) Storage and retrieval of data gathered from soil surveys andland use surveys made by the Department's soil and analyti-cal services branch;

(c) processing of data for the Farm Group Subsidies and the CoconutReplanting and Rehabilitation Schemes;

(d) analysis of farm'management projects.

28. These computer facilities would be shared with MARDI (Annex 10,paras 7-9).

D. Organization and Management

29. The Extension-Liaison Unit would operate as part of the ExtensionBranch of the Department of Agriculture under the Director of Extension. TheUnit would be headed by an Assistant Director, and each of its four sectionswould have a Senior Agricultural Officer as Section Head. The structure ofthe Unit is shown in Chart WB 9155.

30. Special attention would be given to liaison with the Farmers'Organization Authority (FOA) to ensure effective planning of extensionactivities through the FOA Agricultural Development Centers. An Exten-sion-Liaison Committee would be set up for liaison with MARDI and otherrelevant agencies. This committee should have senior representatives ofthe Department of Agriculture, MARDI, the Veterinary Department, RISDA,FELDA, RRIM, FOA AND MPIB.

31. Sub-committees with responsibility for liaison in particularcrops or specialist service areas would also be established. They wouldinclude representatives of other agencies with extension or research respon-sibilities. This would minimize the risk of competitive activity betweenthose agencies in both the investigational and extension fields, and wouldalso aid in defining the responsibilities of each organization, as well asproviding a venue for the detailed'planning of collaborative work.

ANNEX 11Page 7

E. Project Objectives

32. The Project would strengthen the Extension Service and relatedactivities of the Federal Department of Agriculture, and improve itscapacity to channel advice to Federal and State Departments and organi-zations on new crops and improved crop technology. It would also providea useful channel for feeding important problems encountered in the fieldback to MARDI for investigation.

33. It would strengthen the relationship between the Federal and StateExtension Services so that agricultural development in all States is equallyserved, and operates in conformity with Government policies and objectiveslaid down in Malaysia's Five-Year Plan.

34. It would assist in coordinating the extension activities of allorganizations involved in rural development, thus providing a mechanismfor an integrated approach to the problems of rural communities.

F. Cost Estimates

35. The estimated cost of all goods and services which would be financedto provide the Department of Agriculture with a new Extension-Liaison Unit,is shown in Table 11.1.

April, 1975

nI ~ ~~~~~~~~~~~~~ -g.. o. 0 O 1- N 0 0 e: 0 0 ° 0 ,;w 0 0 0 0 0 0 0 0 0 0 0 0

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e~~~~~~~~ ~~ ~~~~ 0 0 00 0 0000 8<

o | g { Z 4 d sD ,>~~~~~~~~~~~~~~~~~~~~~~~~~~~0

>1 V111MfitN 0 N

MALAYSIAAGRICULTURAL RESEARCH AND EXTENSION PROJECT

Department of AgricultureExtension Liaison Unit

DIRECTOR OF EXTENSIONExtension Liaison Unit(New)

'(existing)

ASSISTANT DIRECTOR I ASSISTANT DIRECTOR 11

(SUPERVISORY/COORDINATION (PROJECT DEVELOPMENT)

Devel pment | Farm Commulication Farmers' Rurat Phic Relations _.COMMUNICA S NG PROJECTS SUBJECT AATTERofFar Management anid eeop nYutadFmiie Extenision Informations eeop nt Development Special Projc

cFmm,lesicatronslstudies project Dor,,tScl oation-documentation data collector plomt poject crop ppOdu-in-|

-mass medi data pr.ocessing farm ma-gnaecir rolls- visa at ids r ePortiig 05tensmiOn crop protect-o-development of teaching -- farm management -- groap actio , echani-tionmaterials studies -oath, fa,nmf-es and home,,n CUrso-,

existinge training extnsion com,pt,er farrd devetoj1 ,nent

'(as in Organization and Scope of Fni,ctroiriExtension and Advisory Branch

Wirfd Banrk -- 1fflhRf

ANNEX 12Page 1

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

Project Costs and Financing

A. Project Costs

Total Costs

1. Total Project Costs estimates at US$108.5 equivalent arebased on 1974 constant dollars. The FE component is $28,500,000.

Physical contingencies estimated at 5% were added to theestimated base costs.

Price contingencies differ between expenditure groups.They are:

On local costs: Fifteen percent in project year 1 (1975),decreasing at an annual rate of 1% to 10% in project year 6 (1981).Total for the project period is 54.3%.

On Equipment: Total for the project period is 21.0%.

On expatriate salaries and fellowships: At a rate of 5%per annum applied to the FE component of the "Services" group ofcosts. Total for the project period is 14.5%.

The summary of Cost Estimates is shown in Table 12.1. Subsidiarytables are shown in the appropriate Annexes.

Computer Cost Estimates

2. The estimates include an amount of $1.5 millio'n for a computerfor joint use by MARDI and the Department of Agriculture for researchand administrative, soils and other data, storage purposes. The computercost estimates brought back by the appraisal mission were reviewed by theBank's Computer Activities Department. They found the estimates of bothcost of the computer and cost and feasibility of transmission facilities,as well as the computer needs of a large research establishment, were inall likelihood underestimated by MARDI and the Department of Agriculture.Following this advice, a letter was written to the Director of MARDI, onthe Bank's findings. The letter also advised him to engage a consultantto review their computer needs and costs, and that the Bank would finance

ANNEX 12Page 2

the estimated cost of the consultant's ($20-30,000) out of the Project Loan.Until this study is to hand, the $1.5 million estimate shown in the attachedSummary of Costs table is purely notional. The estimates will be updatedwhen the consultant's study is to hand.

3. Of the project's base cost, about 60% is absorbed by local andexpatriate salaries, the balance being for equipment, livestock and currentexpenditures. Local salaries are about 50% of all costs, and expatriatesalaries make up about 43% of total FE costs.

4. Local staff cost estimates are shown in Table 12.2 and theextent of expatriate services to be engaged are shown in Table 12.3.Table 12.4 shows the relationship between local staff, staff fellowshipsand expatriate staff. The table indicates that the substantial expendi-ture on expatriate salaries is necessary to maintain staffing levels atan acceptable level, while local staff are away on fellowships.

B. Financing Plan

5. The FE component of the Project would be financed as follows:

Services

Expatriate Staff 100% of FE expenditure

Fellowships 100% of FE expenditure (if dura-tion is longer than 9 months,includes cost of family traveland living expenses)

Support for Overseas Missionsfor the collecting of gene-tic material 100% of FE expenditure

Project monitoring 100% of FE expenditure

Goods

Fquipment 100% of FE expenditure, CIFMa lays i.a

Tivestocl Q00% of FE expenditure, CIFMalaysia

Fuildings 33% of total contract value(estimated FE Component)

ANNEX 12Page 3

6. The sum of physical and price contingencies and the roundingfactor would be kept in the unallocated Category of the Loan Agreement.

7. Retroactive financing would be made available for the computerconsultant's study ($20,000) necessary to determine the precise computerneeds, associated transmission, training and staffing requirements ofMARDI and the Extension-Liaison Unit, and the cost of the hardware.

April, 1975

',ALAYS IA

A&RICLLLIRAL ltSLRqCUi AL) 0. SION 0, - I.:

lotnaro of Cost CEelnatec002S 1220 icclcvaloen

Ye I Yar 2 Yer 3 Yar 4 seori Yean 6earoI-6

Local P-reigo Local Foreign Local F Locl Foi Lcal Local Fore, Local ForeLgn Tot..l or e

I, 11.RDT

Pl_napple Research Prognen 62.0 420.7 62.0 303.4 26.5 270.9 8.5 156.8 8.5 164.3 8.5 147.2 176.0 1,463.3 1,639.3 Table 4.1Field Crops ReTearob Fh ognos 101.9 724,6 99.5 565.7 48.0 421.7 48.4 417.3 30.4 315.3 15.9 270.6 344.1 2,715.2 3,059.3 Tobll 3.1gle Reerh rgon123.9 435.7 124.2 312.3 33.9 312.2 14.9 210.7 14.9 210.2 5.9 159.7 318.2 1,211.0 2,028.5 Cable 2.1Lv-to.k Reoe.r-h Program 285.5 549.0 309.8 629.1 164.7 1,638.6 J33. 359.9 24.3 308.9 15.3 25379 832.7 3,743.4 4,57268 Table 6.1C ... /C ..... Re..earob frega- 116.2 489.3 319.3 611.9 230.9 436.6 15.3 262.1 16.1 307.2 2.9 2 17 .2 705.9 2,348.3 3,054.2 Toblo 5.1Feodon/C°°tisatl RtesLte Reneer-h p-ogean 4916 317. 8 58.6 415.8 22.5 1,115.5 31.5 304.5 13.5 182.1 13.5 182.1 189.2 2,087.8 2, 777 0 Thbl 7.1Agnicoltorol inglesering and wRoer

Mlanagement ROsear. Program 114.4 387.5 206.8 560.3 106.2 389.5 28.5 252.1, 105 136.8 10.5 130.7 426.9 1 857.2 2 334.1 Table 8 1ftojeet Dlen-e ope Unit 20.4 179.7 20.4 266.6 20.4 232.3 2.4 130.3 2.4 122.8 2.4 115.3 68.4 1,047.0 1,115.4 Table 9.1Central leroiree-/ - 179.3 _ 902.2 - 1.100,0 62.0 - 68.0 - 600 _ 2.361,5 2,361.5 rable 10.1

lob-total I 873.9 3,682.6 1,200.4 4,637.3 651.7 6,007.8 182.7 2.129,0 121.3 1.808.1 79.9 1,340.7 3,109,9 19,835.5 22.945.4

11. Deeortamet of Aseloaltone

ExtenseLn Liolino Unit 339.9 499.1 351.6 753.5 364.6 755.5 12.0 299.6 12.0 2996 12.0 299.6 1.092.1 2.906,9 3,999.0 Tabll 11.1

S.b-total It 339.9 499.1 351.6 253.5 364.6 755.5 12.8 299.6 12.0 299.6 12.0 299.6 1.092m1 2,906 6 3.999.0

III. Staff ad Loegi Contn

MARDT - snpa-t-nt of Agri-oltaregetne..en of Liaison mUit

Staff Cnts2 3,242.8 3,978.0 - 4,861.6 _ 5,413.9 - 6,044.5 - 6,584.9 - 3n,179.7 _ 30,125.7 Tabl 12.2Loeml Research Con

5 71 50% f 0 alarLeF- 1,621.4 1,989.0 - 2,430.8 - 2,707.0 - 3,022.2 _ 3,292.4 - 15,0.2.8 - 15,062.8

Pr-jeer Mo narisg- - 20.8 - 20.0 20.0 - 20.0 28.8 .20.0

Sab-total III 4,864.2 20.0 5,967.0 20.0 20.0 1,120.9 20.0 9,066.7 20.0 9,877.3 20.0 45,188.5 120.0 45,308.5

IV. F-tlect Boan Co-ae (S.b-eotale I + IT + III) 6,078.0 4,201.7 7,519.0 5,418.8 8,308.7 6,783.3 8,315.6 2,438.6 9,200.0 2,127.7 9,969.2 1,860.3 49,390.5 22,862.4 72,252.9

V. PhyRi-al Contingencies, 551 303.9 210.1 376.0 270.5 415.4 339.2 415.8 123.9 460.0 106,4 498.5 93.0 2,469.6 1,143.1 3,612.7

VT. Prolec- Coste in-lodfag PhY.ecol Cenfi-gaeeiga(IV 4 V) 6,381.9 4,411.8 7,895.0 5,681.3 8,724.1 7,122.5 8,731.4 2,6C2.5 9,660.0 2,234.1 10,467.7 1,953.3 51.860.1 24,005.5 753865.6

VTI. frion Costingemelen-on lecal goals 628.8 - 1,923.7 _ 3,454.7 - 4,976.9 - 2,245.0 - 10,286.0 . 29,17429 - 28,184.0-on sqoipmn - 120.3 - 451.0 - 10

72.5 2^4.1 _ 268.2 - 301.1 2 2,417,2 2,417.2

- em empotrtate amlanies and fellow-hipa - 49.9 _ 183.3 - 292,6 - 343.4 - 368.3 - 394.7 - 1,632,2 1,632.2

ob-total VII 478.6 170.2 1,823.7 634.3 3,454.7 1,365.1 4,976,9 547.5 7,245.0 636.5 10.206.0 695,8 28,184.9 4,049.4 32.234,4

Ptoject TotFI Cost (V1 + VI) 6.860.5 4.582.0 9,718.7 6.315.6 12.178.8 8,478.6 13,708.3 3,150.0 16,905.0 2,870.6 20,673.7 2,649.1 80,045.0 28.055.0 188,100.8

Ronding Factor - 445.0 445.0

PROJECT COST 6 808045.0 28,500.0 108,545.0

Leo Seoff CostaL32,125.7 - 30,125.7

lot P-ejer-t Coats 49,913.3 28,580.0 78,419.3

1/ 8Lbjec, to findlogo of omputeoneo Iants

2/ -sooptiem made: Re--orrh 0Tc ace node op as folloo1 :Staff cents 66.6%

Op-rations costs 334'%All coats 100.07.

(B..ed on CSIRO ompeodit.r.a)

3/ "Thren wise =en" elarLem and teaoel rosti, 0.33 MM/Year

Aprll 3, 1975

MALAYSIA

AGRICULTURAL RESEARCHI AND EXTENSION PROJECI

STAFFING AND SALARIES

EtabblihlLoont Cost ElRot -tos

1974 1- 1975 1976 1977 1978 1979 1980

. ~~~~~~~~~~~~~2/ 2/ 2/ 2/PRO0RAM Prof-.SPtonal Sob-Profss tonal ProFessllonal SoR-profostoonl Profess onal S,,b-PrnfrstoraC Prof sasioal -oh- rofosslonaT Profosoitnal Sob-lPeotesslooalfProfesIloot Soh-Profestonal Irro o jol C b-Proo

STAFFPING 1'

MARDEI Staff slots for:RleI 17 32 20 40 23 46 25 50 27 54 30 60 37 64

pIo.appla 9 6 12 24 13 26 14 28 15 30 16 32 18 36

Llvostoob 14 6 20 40 20 40 21 50 30 60 33 66 35 71

Field Crops 11 22 15 30 20 40 25 50 30 60 35 70 38

Crop itt Szt ston 22 14 25 39 28 49 30 t(l 33 AR 35 70 4" 84.ETo ItWsrloaaodator Rgt. 7 3 7 12 7 14 12 24 12 24 17 34 17 34

Cocoo/CoUooor 11 11 L3 16 15 30 I 34 19 TD 21 42 2 76

Pro/oat Uoooloea=et 10 6 11 22 It 28 19 36 127 44 75 SO 2? l5oCeosral foIefittso - -3 3 35 10 7 10 7 10w 10l

AUD Tona D...101 106 126 226 145 278 174 349 195 366 219 434 238 472

b.ladres for staff IS a 1II00

Pnof1as2onal 3/ 2,268 2,6t0 3,132 J,510 3,902 72124

SuR-Profosa- onal .,868 2 224 2,752 3,088 3,472 7,776

Juntor Rasoseob 47 1,356 7 6 ,6 ,316 2,b608 9>3/3

Dtront Staff roots 5,432 6,502 7,948 8,914 tOI 01b 1W7092

Soloresa on. roast 5 2.173 2,600 3a? 2,93,66 4;007 4 3S7

Aonnul stAiff ooasstooolD ouR-total 7,605 9,102 11,127 12,48U 14,015 I,4

DEPT taff alato for: STAlFFING

OP ERtors io/Liaiao- Unit S 10 9 20 18 46 18 46 18 46 10 40,AGRIC.

NS 1000

SoRsolos for ataff

5Rb-yrofelDlonal 3/ 90 162 324 324 324 374S.b-Pfo ...Rt-1 - 85 160 368 366 368 Ifs

Dioret Staff ... t0 170 322 692 692 692 692

salory 00-roas: 1007. 170 322 692 692 692 697

fotrnoion-Llatson Unit ) a

Ao.oal staff oots 34 644 784 784 784 U

sob-tot 1

PROJECr STAPP COSTS TOTAI 7,945 9,746 11,911 13,264 14,nI9

IIS $ EquIva1t 3.242,8 3,978.0 4,961.6 5.41 1.9 4,1144 . 9

1/ Or beard to 1974; Slots 1975-Ro

2/ Resrarrh A-1-stools only; r-rludino .l,nt or r-s- ar- h Aes itato sod Teri:l-d anc

3/ Profooslosi na 817 DCOoliuraron::nilmrr hlowo to olulmn ah=yeSoh-Profeosiooots:t*Aou0T/vernron:wldrr sI:ooo In onIoln abone

4/ Nuab-r of Sob-P-nfass lanai slt!f 2 a MS31'31

: Peopo-rtro-Ily to total MAR0I staff o-t - 40G2

April 3, 1975

J-,

ANNEX 12Table 12.3

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION IIAISON PROJECT

Man-Years of Expatriate Specialists

Program Agricultural Scientist Engineers Other Total

MARDI Long- Short- Long- Short- Long- ShortTerm Term Term Term Term Term

Field Crops 13 9 - - - - 22

Agr. Engineering andWater Management - - 14 1 - - 15

Pro.ject Development 3 - - - 3 1 7

Rice 11 3 - - - - 14

Product Utilization - - 3 - 9 3 15

Pineapples 6 h - - - - 10

Livestock 9 2 - _ _ _ 11

Cocoa/Coconut 6 4 - - - - 10

Dept. of Agriculture

Extension-LiaisonUnit 1 - - - - 8 9

TOTAL 49 22 17 1 12 12 103

November 21, 1974

ANNEX 12Table- 12.4

MALAYSIA

AGRICULTURAI RESEAROj AND EXTENSI PROJECT

Staff Development Prograul/

Staff at End of Prolect Year Gross andEffectiveStaff

PROGRAM 1 Total PercentagesPEOGRMf ~ ~ ~ ~ ~ ~ ~~ ~ ~ ~ ~~1 2 3 4 5 6mam ycars Yrsl-6STIA I F I b G N U h B R S

MIRDI

Rice Research Proxr, Local Staff 20.0 23.0 25.0 27.0 30.0 32.0 157.0 1007.Mimes Fellowships 7.1 7.2 7.2 7.2 7.2 7.1 43.0Plus Expatriate staff 3.5 3.5 3.5 1.5 1.5 0.5 14.0

lVet effective working staff 127.0 807.

Pineapple Research Program, Local Staff 12.0 13.0 14.0 15.0 16.0 18.0 88.0 1007.minus Fellowships 6.5 4.0 4.0 4.0 4.0 4.0 26.5Plus Expatriate Staff - 2.7 2.7 2.7 0.7 0.6 0.6 10.0

Net effective working staff 71.5. 81.

Livestock Research Frogr_, local Staff 20.0 20.0 25.0 30.0 33.0 35.0 163.0 . 1007.Minus Fellowships 6.0 6.0 6.0 * 6.0 6.0 6.0 36.0

Plus Expatriate Staff 0.3 3.4 3.4 2.3 1.3 0.3 11.0

Wet effective working staff 138.0 85

Field Crops Research Prograx. Local Staff 15.0 20.0 25.0 30.0 35.0 38.0 163.0 1007Minus Fellowships 9.0 9.0 9.0 9.0 9.0 9.0 54.0Plus Expatriate Staff 4.5 4.5 4.5 4.5 2.5 1.5 22.0

Yet effective vorknlg staff 131.0 8an

CocoaJCconut Research Pro=rs. Local Staff 13.0 15.0 17.0 19.0 21.0 22.0 107.0 1007.Minus Fellowships 5.3 5.4 5.3 5.4 5.3 5.3 32.0Plus Expatriate Staff 2.0 2.0 2.0 1.0 1.0 1.0 10.0

Net effective working staff 85.0.. 807.

Crop Utilization Research Progrsm, Local Staff 25.0 28.0 30.0 33.0 35.0 40.0 191.0 1007.Minus Fellowships 7.3 7.4 7.4 7.3 7.3 7.3 44.0Plus Expatriate Staff 2.5 3.5 2.5 3.5 1.5 1.5 15.0

Met effective vorking staff 162.0 857.

Agricultural Engineering adWater Management, Local Staff 11.0 14.0 19.0 22.0 25.0 29.0 120.0 1007.Mgus Fellowships 4.0 4.0 4.0 4.0 4.0 4.0 24.0Plus Expatriate Staff 1.2 4.1 4.1 3.2 1.2 1.2 15.0

Net effective working staff 111.0 92%

Project Develojxent Unit, Local Staff 11.0 14.0 19.0 22.0 25.0 29.0 120.0 100tMinus Fellowships 4.0 4.0 4.0 4.0 4.0 4.0 24.0Plus Expatriate Staff 2.2 2.1 2.1 0.2 0.2 0.2 7.0

Ret effective working staff 103.0 86%

Central Facilities, Local Stafi-/ 3.0 5.0 7.0 7.0 7.0 7.0 36.0 100%

Department of AgricultureExtension Liaison Unit, Local Staffa' 15.0 29.0 64.0 64.0 64.0 64.0 300.0 1007,Minus Fellowships 9.0 17.0 17.0 17.0 17.0 17.0 94.0Plus Expatriate Staff 2.5 1.5 1.5 1.5 1.0 1.0 9.0

Net effective working staff 215.0 72

1/ Local staff data: Frau Table 12.2Expatriate data: From Table 12.3; short-term consultancies assumed spaced evenly throushout project period; this may or may not in fact be theFellowship data: Derived from Table I to Annexes 2-10; Fellowships will be taken up more or less evenly throughout project period

2/ No Fellowships or Exatriate Staff forseen now.

3/ Unit is to be created fr9i scratch; nuabers include full professional staff plus recent graduates at sub-professionai level of eaployeentthroughout the Departunt of Agriculture to staff the unit.

April 3, 1975

ANNEX 13Page 1

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

Project Disbursement and Procurement

A. Introduction

1. The Project would provide the foreign exchange component (US$28.5million equivalent) for the procurement of goods and services for MARDI.Total project costs are summarized in Table 12.1. These estimates includea physical contingency and different price contingencies for the variousexpenditure categories (Annex 12, para 1). All costs are expressed inconstant 1974 US dollars. The goods and services to be financed fall intothree broad categories and for each category, different procurement proce-dures would be used.

2. The three categories are:

(a) Provision of expatriate specialists services

Senior research scientists would be engaged to activelyparticipate in the various research programs. Periods ofengagement would range from short term consultancies to3-5 year long term appointments. These would all be seniorscientists. The FE cost of their services would add upto $51,000 per man year. This figure includes air travel,provision for medical care and permanent and total disabilitybenefits, life insurance, accidental death and dismembermentbenefits, contributions to a retirement plan (which mayalready exist in the expatriate's home country) children'seducational benefits, and for long-term appointments, a farepaid return trip to the home country for the expatriate andhis family every two years. An amount of $9,000 equivalentper annum is estimated for local financing of these itemsand for housing and amenities in Kuala Lumpur and the dailyreturn transportation from Kuala Lumpur to Serdang, a dis-tance of about 30 kilometers.

(b) Fellowships

These would permit MARDI staff to further their skills byadvanced studies at overseas Universities. Long term fellow-ships (which form the bulk of the fellowships) would lead toMSc and PhD degrees. Short-term fellowships would permit

ANNEX 13Page 2

MARDI staff to participate in short overseas trainingcourses. Cost estimates are based on $1,200 per month forreturn air travel for staff member and his family to anoverseas University, and special living allowances, etc.,whilst overseas. The staff member's local salary wouldcontinue.

(c) Goods (other than livestock, feedstuff and fertilizer)

The Project would assist in providing the F.E. component ofBuildings and other capital requirement (mainly researchequipment and farm machinery) and current expenditurerequired for the research effort in the commodity researchprograms, the back-up research groups, the Project Develop-ment Unit and central computer and library facilities andthe Department of Agriculture's Extension-Liaison Unit.

(i) Buildings

The FE component of the various buildings to be financedunder the project is estimated at 33% of total buildingcosts, i.e. in line with estimates by the MalaysianPublic Works Department.

(ii) Equipment

All equipment is to be imported and their FE component isestimated at 100% of C.I.F. value.

(d) Goods (livestock, fertilizers, feedstuffs)

It is likely that most of these items would be imported.A local freight component (about 10%) is added whereappropriate.

B. Disbursements

3. The projection of expenditures over the project period of May 1975to December 31, 1981, indicates that the program is essentially based on theprovision of physical facilities during the first three years of the Project.Concurrent with the early development expenditures is the provision of spe-cialist services and fellowships. These services expenditures, as well asother current expenditure, such as fertilizers or research consumables, ex-tend throughout the project period. The estimates in the cost tables withthe various Research Program Annexes and the Summary shown in Table 12.1 areshown in the year when commitments are made. Disbursements would commenceabout 6 months after commitments. A disbursement schedule is shown in Table13.1. The Project's completion date would be December 31, 1981.

ANNEX 13Page 3

C. Procurement

4. Because of the different nature of the three major expendituregroups which would be financed under the Project (para 2) different pro-curement procedures would be followed:

(a) Expatriate Services

(i) Specialists would be selected by the Director of MARDIon the advice of his staff, on the basis of expectedhighly specialized contributions the scientist couldmake to MARDI's various research programs. The Directorwould forward two conformed copies of contracts withspecialists to the Bank prior to forwarding withdrawalapplication.

(ii) Extension-Liaison Unit

Similar arrangements would apply for the engagement ofspecialists.

(b) Fellowships

The Director of MARDI and the Assistant Director of theExtension-Liaison Unit would select recipients of theseFellowships from amongst their staff. The Directorswould enter into an agreement with the Institute ofLearning and the Fellow concerned. The Bank wouldfinance the FE expenditures arising from these agree-ments. The agreement between MARDI and the Extension-Liaison Unit and the staff Fellow would in all casescontain a clause which would require the Fellow toreturn to MARDI's, or the Department's, employmentupon completion of the Fellowship for a period of notless than 1-1/2 years for each one year of fellowship.The agreement would also provide for, and the Bank wouldfinance, the FE component of international travel andexpenses by the Fellow's family for fellowships in excessof 9 months' duration.

(c) Goods (other than livestock, fertilizer and feedstuffs)

(i) Buildings - No major buildings are to be built underMARDI's program, but numerous small field laboratories,plant houses, and feed stalls, etc., are required inSerdang and in the various local research stations.The Extension-Liaison Unit would construct a numberof hostel and office blocks in Kuala Lumpur. Inter-national competitive bidding in accordance with Bank

ANNEX 13Page 4

Group Guidelines would be followed. TheMalaysian Public Works Department would be respon-sible for design and supervision of construction ofthe building works. None of the works is large enoughto warrant prior approval of the Bank. The Bank wouldfinance 33% of expenditures against proof of progresspayments. Because of the small size and scatterednature of the buildings to be constructed it is notexpected that the contracts will be of interest tointernational firms. Malaysia has an experienced andcompetitive construction industry fully capable ofhandling building contracts to be financed by theProject.

(ii) Equipment

(a) Farm Equipment would be bulked to make up contractsof sufficient size to attract bids from overseasmanufacturers or their local agents. Competitivebidding in accordance with Bank Group Guidelineswould be followed in preparing invitations to bid,advertising and awarding of contracts. TheBank would finance 100% of FE of the CIF value of allequipment purchased. For any contracts in excess of$100,000, the Bank's prior approval would be soughtbefore invitations to bid are advertised and con-tracts are awarded. For other contracts (equivalentof less than US$20,000) would be let according tonormal Government Procedures which are satisfactory.A margin of preference of 15% would be given tolocal manufacturers in bid evaluation.

(b) Research Equipment would be bulked to make up con-tracts of sufficient size to attract bids from for-eign suppliers or their local agents. Internationalcompetitive bidding in accordance with Bank GroupGuidelines would be followed in all bid procedures,however for contracts estimated to cost equivalentof less than US$20,000 would be let according tonormal Government Procedures which are satisfactory.For any contracts in excess of $100,000, the Bank'sprior approval would be sought before invitations tobid are advertised and before contracts are awarded.

(c) Goods (livestock, fertilizer, feedstuffs)

(i) In about the third year of the project period, MARDIwould import cattle, pigs, goats and poultry to broadenthe genetic basis of the proposed livestock breeding

ANNEX 13Page 5

program. The imported 'ivestock would be bought athigh costs, but at the end of their useful breedinglife could be sold only at local prices for consumptionpurposes. To finance livestock purchases, a LivestockFund would be set up within MARDI. The Fund would beused to administer the purchase and sale of livestock.The Fund would therefore initially be US$1,234,700equivalent and M$ 302,800 from Project funds set asidefor purchase of the imported stock, plus sufficientlocal funds by MARDI for the purchase of local stockfor evaluation trials under the pasture program.Proceeds from livestock sales would be credited tothe Livestock Fund, which would not be used forany other purpose than replenishment from time totime as required, of both imported and local stock.Since the Livestock Fund would derive income fromthe sale of all local, crossbred and imported stock,it is anticipated that enough funds would be generatedto purchase further imported and local stock as andwhen required. The Fund would be administered by aCommittee chaired by the Director of Mardi and member-ship of which would inc'lude the Senior Assistant Directorfor Research Programs and Assistant Director for Devel-opment and Administration. Requests for stock purchaseswould be made to this Committee by the Field Crop SeniorScientist and the Livestock Senior Scientist. Afterthe initial financing of the Livestock Fund no furtherexternal funds will be provided for the importation oflivestock.

(ii) Suitable exotic livestock and semen to be purchasedwould be available only from a few sources in theworld. The Director of MARDI would submit to theBank a list of not less than three countries fromwhich it is proposed to seek supplies to ensurefreedom from foot and mouth disease for the purchaseof beef and dairycattle, and swine fever. Embassiesof these countries would be notified of the intentionto buy livestock and simultaneously Malaysian Embassiesin the nominated countries would place advertisementsin the press inviting offers from interested suppliers.The Bank's prior concurrence would be required for allinvitations to bid and the contracts for the supply ofsuitable dairy cattle, beef cattle, and Murrah andSwamp buffalo; the concurrence would inr'ude concur-rence on price, age, quality, source and suitabilityof the livestock for the project.

ANNEX 13Page 6

(iii) The Director of MARDI would ensure that standardGeneral Conditions of Contract would be preparedfor the purchase of all classes of livestock andthis standard format would be approved by the Bankonce, for all classes of stock.

(d) Whilst it is expected that most of the goods andservices would be imported and the Project woulddisburse 100% of the landed cost, however the projectwould only disburse for 70% of the purchase price ofimported goods purchased locally. Disbursement forlocally manufactured goods, purchased after compe-titive bidding, would be on the basis of 100% ofthe local expenditure.

April, 1975

AINEX 13Table 13.1

MALAYSIA

LSKIGULTURJRi RE$Js4RCH hD EXT-JSL PRC'vCT

Estimated Schedule of Disbursementsl/

IBRD/IDA AccumulatedFiscal Year Disbursementsand Quarter US$ x 1000 Equivalent

1975r/761st2nd3rd4th

1976/77Ist 1,0002nd 3, 5003rd 6,ooo4th 7,500

1977/78lst 9,0002nd 10,9003rd 12,5 004th 15,C000

1978/79lst 17,0002rnd 19,4003rd 20,2004th 21,000

1979/801st 21,8002nd 22,5003rd 23,2004th 23,900

1980/811st 24,6002nd 25,4003rd 26,2004th 27,000

1981/821st 27,8002nd 28,500

Assnming loan signtng by May 31, 1975

February 3, 1975

ANNEX 14Page 1

MALAYSIA

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

Justification and Benefits

A. Introduction

1. Society has for a considerable time supported research, whetherthrough public appropriations or through private support. By such support,society indicates that it values research. It values new knowledge forits own sake and in this sense, research is a consumption good. It alsovalues research for the support it gives to economic wellbeing (agricultural,engineering, medical and other applied research) and since there is a timelag between expenditure and actual contributions to economic wellbeing, thiskind of research is an investment good.

2. Since the applied research emanates from within the economicsystem, conceptually it is possible to view it in economic terms. Theinvestment in research is made because society and its decision makersdesire a change in the aggregate production function. The investment istherefore a demand derived from a-priori notions that a shift in the produc-tion function is not only desirable but also possible. The supply functionis new technology, in itself an intangible good in most cases, 11 but havingthe potential to change production functions by increasing the efficiencyof resources used in the productive effort.

3. Whilst research can thus conceptually be viewed in a demand andsupply context, it is different from normal demand and supply relationships.It is different for two reasons:

(a) most of the capital employed in producing the supplyis human capital

(b) the production process, i.e. the time when impact of aspecific program is available, is beset by a degree ofuncertainty far in excess of other production processes(para 8).

1/ But not in all, e.g. HYV Seeds.

ANNEX 14Page 2

4. Decision making in resource allocation. To take the first pointfirst, research is the outcome of intelligence and specific training appliedto the removal of constraints. As a result, and as is evident from the costestimates shown in the preceding annexes, a large portion of the project costis applied to the furthering of skills, it is the application of capital toenhance the productivity of costs already sunk in the training to first degreelevel of the research scientists and the importation of skills from overseasas complementary inputs.

5. The investment in human capital creates experts in the "how" ofresearch but not in the "why" of research. Even if they were expert in the"why" of research, their advice would lead to price - and hence investment-distortions since the capital thus created would influence the investment'pattern in itself. In this, the human capital is different from capitalcreated in the form of dams or roads, which would not have an interestthemselves in creating more dams or more roads. The establishment or expan-sion of research organizations based solely on the advice of the researchestablishment and the judgement of its own merit, must be suspect becauseof this unique reason.

6. On the other hand, if a social benefit-cost analysis is to becarried out as a proxy for a distorted pricing mechanism, the benefit-costanalysis also will be distorted because parameters, such as timing - resourcerequirements - evaluation of risk, for the analysis must be derived fromwithin the research establishment. Exante benefit-cost analysis of researchis therefore likely to be as suspect as a scientist's judgment on the meritof his research.

7. Decision making under undue risk. As to the degree of risk, thesecond reason mentioned in para 3, cost of research is unknown. In this,too, investment in research is different from investment in the more tradi-tional fields of investment in which the Bank operates. In building a dam,an irrigation system or a road, the resource requirements are pretty wellknown before the construction of these facilities commences.

8. This is not the case in research. As an example: if in Malaysiaas a result of the increase in the cost of Nitrogen, a decision is made thatmore research on Nitrogen fixation is desirable, 1/ research objectives canbe set: the development of a legume cropping system which will fix andrelease for use by other crops, 25 lbs. of N per acre more than currentlyis being produced. If this could be done, then Malaysia would potentiallybenefit by 25 lbs. of Nitrogen on not less than, say, 1 million acres,

1/ This decision was in fact made during discussions between the appraisalmission and MARDI staff. It accounts for the increased investment inrhizobium research shown in this appraisal report and the minor invest-ment in this subject shown in the preparation report.

ANINEX 14Page 3

valued at US$17,500,000 per annum. Both the technical objectives and theeconomic merit are specified. But the cost of achieving the stated tech-nical objectives are unknown, in part because the time element required toattain the technical objectives is not known (3 years, 5 years, impossible?),nor the resource requirements, because at the outset of the research, ajourney into the unknown, no knowledge exists on the failures which mayarise or new research direction to be followed in any of the elements ofa complex biological-agronomic and hence, economic - system.

9. This example sustains the statement made in the preceding para-graphs that because of the undue degree of associated risk, given presentmethodology, ex ante benefit cost analysis of a program of research inagriculture is at best less adequate, as a decision making tool, than inother more traditional fields of investment.

Appropriation of benefits

10. In agriculture, most importantly, appropriation of the benefitsafter attainment of the research objectives, is fraught with further uncer-tainty. Research undertaken by private enterprise, where one decision-maker both initiates the research and implements the findings, would rea-sonably readily permit quantification and appropriation of the benefitsflowing from the research objective once attained. In agriculture, partic-ularly in underdeveloped countries where a low level of farmer education isthe rule rather than the exception, the decision to implement new technologyflowing from research is in the hands of untold decision-makers, each one ofwhom will tend to maximise his private welfare 1/ and each one of whom hashis own valuation of risk inherent in change. Neither the maximisation ofnumerous private welfare functions, nor the assessment of private risk situ-ations may coincide with society's welfare function as viewed by those re-sponsible for social and economic planning.

11. Whilst research therefore may result in an upward move of pro-duction functions, individual operators will nearly always tend to operatebelow them. How much below, and for how long is imponderable and dependson research's companion - information transmittal - and the accuracy withwhich planners have judged the private welfare optima of the farmer-deci-sion maker.

B. Historical and Analogue Decision Criteria on Research and Extension Expenditure

12. Neither benefit-cost analysis alone, nor scientific opinion alone,L.or that of economic or social planners alone, can therefore, ex ante, provide

1/ See: Musgrave and Lesueur in "Drought", Ed. J. Lovett (1973).

ANNEX 14Page 4

either justification for, or estimate benefits flowing from, a research proj-ect. Rather justification and benefit and cost assessment must be found ina concensus of all these, based on analogue, historical and empirical evidence,known physical constraints on the production functions, and the social and eco-nomic targets which society's leaders have set. All this together, the con-census of "wise men" must set the scenerio within which the investment decisionmust be made. It is the reason why in this research project, as was done inthe Bank's research project in Spain, that a council of eminent scientistswould be appointed to monitor the progress and the direction of MARDI's on-going research.

13, Whilst physical constraints on an upward movement of the variousagricultural production functions, and hence the research objectives as nowperceived in Malaysia, have been more fully dealt with in Annexes 2-10, thefollowing may assist in reviewing the analogue and empirical evidence whichis available on the desirability of expanding agricultural research inMalaysia.

14. Empirical evidence on benefits flowing from research. On October 16,1973, Professor Evenson addressed a memorandum to the Consultative Group onInternational Agricultural Research on comparative research expenditures ina large group of countries. In this memorandum, he reviewed the compara-tive state of research in the world, reviewed what data were available anddelineated the data which would be required to adequately assess economicand social returns to research programs. He also produced inter-Nationcomparisons on a host of research coefficients, and provided a selectedbibliography of ex-post benefit-cost analyses on estimated output perresearch dollar, and/or internal rates of return flowing from a group ofagricultural research projects. The bibliography is shown in Table 14.1.It appears from the data in this Table that, for a number of single cropresearch programs, and for a more limited group of aggregate output studies,historical evidence is available that society derives appreciable benefitfrom its investment in agricultural research.

15. Using some of Evenson's inter-country comparisons on key parametersin agricultural research and extension expenditures, this Annex compares aselected group of thirteen Asian countries, all characterized by a majorrice sub-sector, with four major developed countries which have a substan-tial agricultural export (Australia, Canada, New Zealand, USA). The compari-son is shown in Table 14.2 together with per capita income data for thesecountries.

16. This table demonstrates clearly the total research and extensionexpenditures per farm in the four developed countries are of a different,significantly higher order of magnitude than of the Asian countries, inwhich group Japan is of a different order of magnitude than the other Asiancountries.

ANNEX 14Page 5

17. From these analogue 1965 data, it is clear that at that time,Malaysia was spending far less on research and extension than most otherAsian countries. There is, therefore, prima facie evidence that the deci-sion made not long after, in 1967/68, to expand agricultural research andextension through the formation of MARDI appears to be soundly based.

18. Regression of Research Extension Effort and Aggregate Net outputper ha. A skeptic might conceivably argue that because per capita incomesare higher, the four developed countries and Japan can afford to spend moreon research, and that research therefore is a luxury consumption expendi-ture.

19. To test this skepticism, a regression analysis was carried outas follows:

The raw data on key research and extension expenditures shown inTable 14.2 were ranked. A research-extension effort rankingorder (1965 data) was established and is shown in Table 14.3.The ranking order thus established for the Asian countries only 1/was regressed with aggregate productivity per ha 2/ in the samplegroup of countries in 1970. 3/

The regression equation giving the best fit was:

y = a + bx

in which y = aggregate net output per ha 3/

x = research extension effort ranking order 4/

20. The regression showed that:

y = 657.47 - .36.66 x(R - 0.628)

1/ The four developed countries, Australia, Canada, New Zealand, U.S.A.,were left out of this regression. Much of their output derives fromgrazing systems. Moreover the different order of magnitude of theireffort in this field suggests that they belong to a different statis-tical population.

2/ Assuming a 5-year research - adoption lag.

3/ Source: Country data from Bank policy paper on Land Reform.

4/ Source: Table 14.3, last column.

ANNEX 14Page 6

It is evident therefore that a relationship exists betweenthe research-extension effort ranking order and the aggregate output perha in the sample group of countries. For every notch upward on the re-search-extension ladder, the country concerned can confidently expectthat an increase in aggregate output per ha will follow. Graph 9115 (atend of this Annex) is a graphic demonstration of the relationship. Inthis graph, Malaysia is not shown since both its research-extension effortand its aggregate net output per ha are distorted by the rubber industry.

21. Research, therefore, is not luxury consumption - it is a necessaryprerequisite to increasing aggregate productivity per ha.

22. There seems, therefore, good empirical (intercountry comparisons)and ex-post evidence which suggests that investment in agricultural researchper se will lead to an upward movement in the agricultural production func-tion. This applies both to aggregate functions and to single crop researchprograms.

C. Research and Malaysia Planning Targets

23. There rests the economic planners' appreciation of the need foragricultural research. It is a derived demand for research, stemming fromtheir planning targets. The Bank's Agricultural Sector Survey shows thefollowing expected growth rates in demand for agricultural products during1968-1980. 1/

Growth Rate Commodity

High (more than 6%) Oil Palm Products 2/Fresh MilkBeefMutton and lambPoultry meat

Intermediate (4.5-6%) Vegetable oils (other than coconut)Coconut oilCoffeeReconstituted milkPorkEggs (fresh)ButterAnimal oils

1/ Source: IBRD Agricultural Sector Survey - Malaysia, Vol. III.

2/ Source: Derived from IBRD "Development Problems and Prospect ofMalaysia", Vol. 1, Annex 4, Table 2.

ANNEX 14Page 7

Growth Rate Commodity

Moderate (3.0-4.5%) WheatSugarFruitsVegetablesPineapples

Low (Less than 3%) Rice

24. There seems to be ample evidence that from a planning point ofview, research could be justified to sustain three industries, palm oil,coconuts and livestock. Palm oil because in Malaysia, it is a new industrywhose main technology input has been imported, and livestock because scien-tific evidence is available that the state of technology of livestock pro-duction is low in the field of animal science. Production potentials inmeat output or milk production have not reached levels comparable to majoranimal product agricultural systems elsewhere (Annex 6). Moreover, a majorresearch effort is needed in feeding livestock on indigenous materials sincecurrently Malaysia is importing about $80-90 million worth of livestock feedswhich could perhaps be replaced by growing local substitute feeds or pastures,neither of which are currently available and on which basic knowledge inMalaysia is absent. Coconut technology is most inadequate and prior researchis required before replanting schemes, improved agronomy and management canbe properly based.

25. Whilst these planning targets would indicate that research onfruits is a less urgent task, an exception could be made for pineapplesbecause of a potential to reach markets outside Malaysia. These marketsare currently being lost to, e.g. Taiwan, because of the absence withinMalaysia of suitable canning varieties and a poor state of farming and pro-cessing technology, resulting in excessively low utilization rates (Annex 4).If Malaysia's export earnings base is to be widened, one of the planningtargets included in the current Five Year Plan, then here is an additionalcrop on which research expenditure could be justified. Such justificationcould be found also on social grounds. The Malaysian pineapple industry iswholly based on peat soils and but for 2-3 large growers, is a smallholderoperation without alternative means of income on this type of soil. Butresearch on other crops in the fruit group should not be encouraged.

26. As to rice, in the lowest group of growth rates, again socialdisederata intrude to modify purely economic planning criteria. Rice iswholly a smallholder industry and the rice grower is in the lowest ruralincome group. Since total rice acreage in Malaysia is limited, incometargets for this economically deprived group can only be raised by inten-sification of production and justification for rice research can thereforebe found on social grounds (Annex 2; Annex 8). One might argue that onpurely economic grounds Malaysia should concentrate on those crops, whereit has a comparative advantage, such as rubber, and that it should importother food products. Whilst from a purely economic point of view this is

ANNEX 14Page 8

correct, the supply situation in grains, including rice, is precarious. Onsupply grounds alone, research on rice is justified. It minimises risk ofsupply failure.

27. Given these economic and social planning criteria, justificationfor agricultural research by MARDI can be sustained for the following in-dustries:

Oil palmLivestock products and a derived research demand forLivestock pastures, feeds and field cropsCoconutsPineapplesRice and supporting research in water management andfood quality enhancement.

D. Analogue Data in Malaysian Rubber Industry

28. In less developed countries, where private research in agricultureis almost unknown 1/, continued public and political support is needed. Inparticular Malaysia in this respect is fortunate in that it is the home ofthe Rubber Research Institute of Malaysia (RRIM), a world centre of excel-lence in its field. Malaysia is justifiably proud of this Institute andpublic support towards agricultural research is therefore perhaps elicitedmore easily than in other less developed countries.

29. If MARDI is to receive the continued support from the public purseit needs, then its achievements should match those of the RRIM. What arethese achievements? The answers, unfortunately are clouded because of theabsence of most pertinent data.

30. Nevertheless, some approximations can be made. Between 1963 and1973 the yield per acre of estate-produced rubber increased from 658 to1240 lbs/tapped acre and for smallholder-produced rubber from 390 to 805/lbstapped acre. The average for the two groups are 516 lbs/tapped acre in 1963and 956 lbs/tapped acre in 1973. 2/

1/ In developed countries a rairiy large amount of privately fuiided ie-search is undertaken, but this is largely in the fields of agriculturalengineering and machinery, and seeds production.

2/ Source: Malaysian Rubber Research and Development Board (MRRDB).

ANNEX 14Page 9

31. These data were tested in a simple model:

Increase in productivity = I + Y1 + (L + C)

in which Y = annual percentage rate of increase in yieldper tapped acre 1963-1973

L = annual percentage rate of increase in labourconsumption per tapped acre 1963-1973

C = annual percentage rate of increase in capitalexpenditure per tapped acre 1963-1973'

32. The model in fact states that any of the increase in productivityper acre which cannot be explained by the con4entional inputs of labour andcapital is due to new technology, i.e. the supply function of research andextension.

33. "Y" is the model is the average rate of increase in rubber yieldshown in para 30. It is 6.66% per annum. "L" is unknown, but concensus ofopinion of industry leaders in Malaysia with whom this was discussed, isthat it has not risen, in fact it is likely to have dropped. In absence ofbetter data, it is therefore taken as Zero. As to C, two expenditures mayvary, i.e. fertilizers and pesticides. The latter are rarely used, and thefertilizer data supplied by the MRRDB indicate that in the 1963-1973 period,the rate of consumption has drcpped by 0.5%. The figure is consistent withopinions expressed by industry leaders. They all stated that fertilizerconsumption would have dropped due to improved knowledge, the outcome ofresearch of the RRIM, on fertilizer technology (e.g. leaf analysis, betterknowledge of soils, application times, rates and mixtures, etc).

34. The model, therefore, indicates that in the period 1963-1973, newtechnology improved yields per tapped acre of rubber by 7.5% per annum.Some industry leaders indicated that some of the yield increase was attribu-table to replanting. Using new clones and new knowledge on spacing, etc.,itself is an outcome of improved technology, established by research. Inany case, whatever the source of the contribution of replanting, most ofthis took place in the mid-sixties and cptimal yield age has therefore notbeen reached yet, and the factor can be ignored for the present purpose.

35. A calculation was also made on the relationship between the totalexpenditure made by RRIM since 1951 and the increase in rubber yield in the1963-1973 period. 1/ The relationship was determined by a distributive lag

1/ Mr. A. Egbert of CPS kindly carried out the statistical analysis, whichwas based on data and information supplied to him by the appraisal mission.

ANNEX 14Page 10

procedure in which various lengths of lags, and combination of lags, betweenresearch expenditure and increased yields were tried. The statistical rela-tionship was significant and it was established that:

Y = -25.06 + 0.00634 Et-8

Because of yield variability, obviously not related to research, the parameter0.00634 should be reduced to 0.00364. The equation therefore establishes,that, all other factor inputs having remained constant in the analysis period,for each M$ 1000 spent on research a yield increase of 0.00364 lbs/acre fol-lows 8 years later on each acre of rubber produced in Malaysia (currently3,432,000 acres of mature rubber). Current research expenditure is M$ 32million per annum. Given these parameter and a price of rubber at US$0.26/lb,the value of this research in 8 years time would be about US$42,000,000 ifdiscounted at 10% per annum.

E. Yield Increases due to Research and Extension in other Crops in Malaysia

36. Rubber research in Malaysia has been carried out by the RRIM since1925 and one may assume that in the research-output production function ofrubber, the marginal return to research could be smaller than for othercrops in Malaysia which have a far shorter history of research. If there-fore due to research, rubber productivity has risen by 7.5% per annum overthe past 10 years, it is a pessimistic assumption, nevertheless adopted here,that for other crops now the subject of research by MARDI, marginal returnswould be at least equal to 7.5%.

37. How valid is the assumption that what research could have effectedin rubber, can be effected in other crops? A perusal of the staff establish-ment of the RRIM indicates that most of its staff work in the normal disci-plines associated with agricultural research. Few are real rubber technolo-gists; most are agronomists, entomologists, plant pathologists, statisticians,soil scientists and the like. Their specialists still are entirely trans-ferable to other crop research.. The fact that Mr. Hadji Ani, until June1974 Deputy Director of MARDI, was at that time appointed Director of theRRIM, supports this assertion. It is therefore not unreasonable to postulatethat what the RRIM establishment has achieved, and is achieving after 50 yearsof single crop research and possible diminishing marginal returns, could beduplicated by MARDI. Moreover, if MARDI could not match the RRIM effort,in due course the political goodwill now backing MARDI would evaporate.Marching RRIM's research record is therefore not only desirable, it is acondition for survival.

38. Of all MARDI's research programs, four have objectives which, ifattained, sooner or later, lend themselves to a tentative and partial ex-antequantification purely for establishing the cost of lags between commencementof research and attainment of benefits. These four are:

ANNEX 14Page 11

rice research programpineapple research programlivestock research programthat part of the field crop research programwhich deals with fodder crop research

39. The key unknown is the time it will take to achieve these targetsof: (i) reduced reliance on rice importation, (ii) better on-farm and off-farm technology of pineapple production, (iii) better stock quality andmanagement techniques, and (iv) the development of pastures and pasturemanagement and the growing of grain crops for feed production respectivelythrough research on key constraints and work towards ultimate farmer adoption.

40. Assume that the whole of the 5-year research and extension liaisonprogram was devoted to these four targets, that currently known technologywas disseminated more efficiently and that the skilled body of researcherscould improve unit output of the farm commodities by 7.5% 1/ as their col-leagues in the rubber industry have done, then based on current acreages andoutputs, the following rates of return could be anticipated over a 35 yearproject period.

Research Extension Lag in years 3 5 8Investment period in years 6 6 6

Commencement of benefits in year 9 11 14

Rate of return 33.7% 27% 21.3%

41. The rates of return are therefore not dissimilar to those shownin the bibliography quoted by Evenson in Table 14.1.

42. As to the various lag periods, no knowledge is available tonominate one lag period with a higher degree of confidence than any of theother two. With the current poor status of extension services in Malaysia(Annex 1 and 11), the logical assumption is to regard a longer lag period to

1/ The application of the 7.5% rate of yield improvement is not a pureincrease in output. The outcome of the research is not known, it couldbe an increase in yields, it could be a lowering in unit price of pro-duction, it could be due to quality enhancement, it could be due to areduced risk factor in production due to better farming standards; itmost probably is a combination of any of these factors. The 7.5% ispurely an indicative minimum, an industry "betterment factor", i.e.without the research and extension effort the industry would have beenworse off by 7.5% over time. The application of 7.5% to quantitative1974 production data was therefore purely for computational purposes.It does not necessarily mean that output will increase by 7.5% in thenominated time slice.

ANNEX 14Page 12

be nearer the truth than a shorter one. The observable improvement in ratesof return (about 2% for each one year reduction in lag time) for the shorterlag period justifies the preparation of a follow-up Extension Project aimedat complementing and rounding off the Extension-Liaison Unit proposed underthe Project. What should also be undertaken is the multiplication of tangiblenew technology, i.e. a project or projects dealing with the multiplication anddistribution of HYV seeds and other planting material, and the spreading ofimproved genetic material through the livestock industry.

F. Summing Up

43. Whilst no single criterion by itself could justify the investmentin an Agricultural Research and Extension Project in Malaysia, there are anumber of indications which together could provide the justification. Theseare:

(a) In 1965 Malaysia was spending comparatively less on agri-cultural research and extension than most other Asiancountries. The decision made in 1967/68 to expand suchresearch in Malaysia through the creation of MARDI appearsto be justified, on these gounds (para 17);

(b) There is evidence that physical constraints exist on croppingareas, or cropping technology of crops which on social andeconomic planning grounds need expansion in aggregate output(paras 23-27). These constraints can only be removed throughthe introduction and/or adoption of new technology (Annexes2-9).

(c) Rates of return, based on analogue evidence from the rubberindustry, which if applied to some basic data for fourcommodity groups, indicate that a reduction of the research-extension lag is a justifiable objective (para 40);

(d) Derived from the success of the RRIM, there is in Malaysiaa climate of justifiable pride in, and political and financialsupport for, a program of research in agriculture. Thisfavourable climate emanates from the work of the RRIM. Sinceagricultural research is at the best of times, a long-termeffort, such support is absolutely essential. Industry andpolitical support for agricultural research (paras 28 to 35)is perhaps the best guarantee that research objectives canbe attained (Annex 1).

(e) There is ex-post evidence from other countries on the basisof rates of return to individual crop research programs andon aggregate output per ha, that agricultural research isa sound national investment (Table 14.1);

ANNEX 14Page 13

(f) There is evidence that a definite relationship exists betweenaggregate net output per ha and the research-extension effortin a selected group of 12 Asian countries (paras 19, 25).

44. Of overriding importance is the fact that the major beneficiariesthe research and extension effort are Malaysia's small farmers. The better-ment of this economically and socially deprived group is the objective ofthe creation of MARDI.

G. Conclusion

45. (1) Whilst no one of the foregoing indicators in isolation couldprovide full justification for the Agricultural Researchand Extension Project - taken together, they indicatethat the Project would be beneficial to Malaysia's agricul-tural sector and its smallholders in particular.

(2) It will be necessary to ensure on a systematic basis that

research objectives are reviewed regularly

, research methods and resource requirements arereviewed regularly

. research resources are expended efficiently,

if stated objectives are to be attained and if agriculturalresearch is to remain relevant to the needs of Malaysia'sagricultural sector.

46. This systematic review would be facilitated by a panel of monitorsand by the institution of a Planned Program Budgeting System (PPBS) in MARDI.The monitors would ensure external efficiency and the PPB System would pro-vide the necessary internal guidance to MARDI management on the efficient useof the available research resources.

April, 1975

MALAYSIA ANNEX 14Table 14.3

AG2ICULTURAL RESEARCH AND EXTENSION PROJECT

Ranking Order3/ of Research - Extension Effort

Ratio ofResearch ResearchExpenditure Extensionto Value of Research Extension Total EffortAgricultural Expenditure Workers (1)+(2)+(3) RankingProduct per Farm per Farm - Order 3/

Country (1) (2) (3) (4) (5)

Asian Countries

Burma 15 ? ? 15 15

India 12.5 2/ 15 7 34.5 11.5

Indonesia 16 16 9 41 13.7

Japan 4 5 3 12 4

Malaysia 12.5 _/ 9 8 29.5 9.8

Nepal ? 13 13 26 13

Pakistan 11 12 7 30 10

Philippines 6 6 10 22 7.3

South Korea 14 11 5 30 10

South Vietnam 10 14 14 38 12.7

Sri Lanka 7 10 11 28 9.3

Taiwan 9 8 6 23 7.7

Thailand 3 7 12 22 7.3

Developed Countries with Substantial Agricultural Exports

Australia 1 1 ? 2 1

Canada 2 3 2 7 2.3

New Zealand 8 4 1 13 4.3

U.S.A. 5 2 4 > 11 3.7

1/ Ranking order based on data shown in Appendix 1. The ranking order is continuous forboth Asimnand Developed Countries with Substantial Agricultural Exports.

2/ Half rankings (e.g., 12.5) indicates equal raiking (e.g., 12/13)3/ Effort ranking order is: (4)

nApril 3, 1975

MALAYSIAAGRICULTURAL RESEARCH AND EXTENSION PROJECT

REGRESSION OF RESEARCH - EXTENSIONRANKING. ORDER AND NET OUTPUTPER HA. FOR 11 ASIAN COUNTRIES

800

* Japan750-

700 -

65650

v = 657.47 - 36.66 x

R = -0.628

600

550

a 500

wL 450r~ \ \South Korea

> 400

C-,350

< 300 _F- Srilanka 0 Indonesia

z

250 - South Vietnam

Pakistan * \ Nepal

200 -

Thailand e T Philippines

150 -

* India100 \

Burma*

50

05 10 15 x

RESEARCH - EXTENSION RANKING ORDER (1965) -

1 / Data based on table 1 @.3, last column2/ Data based on Bank Policy Paper on Land Reform World Bank-9115(2R)

MAI;AYSI2. *ANNEx 14Table 1L.1

AGRICULTURAL RESEARCH AND EXTENSION PROJECT

Studies on Summary of Implicit Technology Generation Function"

Estimated Marginal

Country (commodity) Output per InternalStudy Time Period Research Dollar rate of return

1. Griliches U.S.A. (aggregate) $7 --(1964) 1949-1959

2. Latimer, R. U.S.A. (aggregate) ---- significant(1964) 1949-1959

3. Evenson U.S.A. (aggregate) $10-12 47(1968) 1949-1959

4. Khaldi, N. U.S.A. (aggregate) not calculated but highreturns implied

5. Tang, A. Japan (aggregate) 35(1963) 1880-1938

6. Ardito-Barletto Mexico (crops) 2.9 5-93(1970) 1943-1963

7. Peterson U.S.A. (poultry) 1.4 21(1966)

8. Evenson South Africa (sugarcane) 15 40(1969) 1945-1958

9. Evenson Australia (sugarcane) 35 50(1969) 1945-1958

10. Evenson India (sugarcane) 40 60(1969) 1945-1958

11. Hayami & Rhttan International not calculated, but high(1972) 1955-1965 returns implied

12. Kislev and InternationalEvenson (1973) 1955-1968

Applied ResearchLDC's 21DC's 21

Scientific Research Relatedto agriculture

LDC's 60DC%t 36

3/ Sourcet Consultative Goup on International Agricultural Research;Memorandum by Prof. Evenson of October 16, 1973

April, 1975

MALAYSIA

AGRICUL'TURAL RESEhRCH AND EXTENSION PROJECT

Agricultural Research and Extension - Country Data-(1965)

Publications inRatio of AgriculturalResearch Services

Research Extension &xpenditures (number ofPer to value of ResearchCapita Expenditures Scientists Expenditures WPrkers Agricultural Expenditures Extension PublicationsIncome (thousand (man-year) (thousand Product per Farm WTrkers Abstractedu.s$.1/ U.S$ ) U.S.$ ) (U.S.$) per Farm in 1962-68

Asian Countries

Burma 80 93 39 - 1262 C4Oh - 1

Ceylon 100 1395 87 - 200 o.58 1.19 0.17 72India 110 12000 1462 - 56000 0.15 0.25 1.15 1551Indonesia 80 131 54 - 6000 0.01 0.01 o.49 76Japan 2130 62500 4500 36310 14126 0.98 10.34 2.33 2197Malaysia 400 820 32 - 317 o.15 1.81 0.70 62Nepal 90 419 142 - 200 - 0.31 0.1, -

Pakistan 130 5014 654 6037 9000 0.23 0.41 0.7h 41oPhilippines 240 7078 1256 - 617 0.69 3.27 0.28 435

South Korea 290 1325 294 - 3217 0.11 0.57 1.38 50

South Vietnam 230 547 40 - 95 0.25 0.29 0.05 19

Taiwan 430 1922 401 - 1100 0.28 2.38 1.36 325

Thailand 210 8428 442 - 502 1.13 2.62 0.16 36

Developed Countries with Substantial Agricultural Exports

Australia 56364 2085 - 2.11 223.67 - 2347Canada 40217 1483 26450 2904 1.28 83.61 6.04 2917New Zealand v 6000 479 - 472 0.55 82.19 6.47 822U.S.A 350000 13800 178000 6233 0.81 94-34 1.68 21092

_~~~~~~~~~~~~~~~~~~~~~~~

1/ Per capita incomes as shown in World Bank Atlas. 1973 edition (D

2/ 'aper of October 13, 1973 of CGIAR

April 3, 1975

IBRD 11238R7- . . 1t .. - .,< *10 l2~ g3~ 104° APRIL 1975

MALAYSIA

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