The Financial Express

Banking on successful agriculture for progress

Banking on successful  agriculture for progress

Regardless of the remarkable progress of some industries across South Asia, agriculture remains the primary source of employment and income for a large portion of the population. In Bangladesh, for instance, 38 per cent of the working population was employed in agriculture in 2019 and more than 40 per cent of Indians are still employed in the sector. Efforts to raise the welfare of the poor across the region also rely on achieving higher and more stable incomes for farm households. Simultaneously, improved management of the agricultural sector is required to deliver on food security and political stability. This is especially the case in the East Gangetic Plain - one of the most populated parts of South Asia.
The national policy settings across the East Gangetic Plain differ in some respects but they also share something in common - all have focused heavily on supporting farmers through different subsidies and price controls. While nobody is questioning the role of these types of measures, it can be useful to stop and reflect on what really works and what doesn't. Despite agriculture's obvious importance, efforts to raise and stabilise farm incomes in places like Bangladesh, Northeast India, and Nepal, have enjoyed only mixed success. In some cases, local nuances have played a part so that the success of a policy or programme in one place cannot be duplicated in another. Unfortunately, there has been no systematic process for gathering information about what makes for a successful policy or programme in the region.
This was the focus of a research sponsored by the Australian government that brought together researchers and policy makers from across Bangladesh, India and Nepal. The project commenced with information gathered from almost 100 policy experts who work closely on agricultural development. These experts were recruited because of their experiences in this field. After nominating the different policies and programmes of interest, experts were then asked to rank those that they thought were most effective at raising and stabilising farm incomes.
On the one hand, it was not surprising to see that experts from the different countries had slightly different rating of the policy approaches. But on the other hand, there was a consistent theme.
Overwhelmingly, the experts from across the region indicated that the difficulty of accessing quality inputs was the main barrier holding back improvements to the incomes of farm households. this is particularly interesting given that much of the policy attention in the region has focused on the prices farmers have to pay for inputs and there has been less attention given to quality input access.
Importantly, cheaper farm inputs were rated quite low by experts as a way of raising farmer incomes. This was particularly the case for experts with experience in the Indian policy setting, where access to quality inputs was adjudged as being at least 3 times more effective than simply offering cheaper inputs. Arguably, this also reflects the fact that input subsidies can make it more difficult for some farmers to acquire seed, fertiliser, and other inputs.
Another important finding was that experts also had relatively consistent views about the best way to deliver on improving access to quality inputs for farmers. Specifically, the experts from across the three countries consistently rated the private sector as the best mechanism for improving access. This was particularly noticeable in the case of experts from Bangladesh and Nepal. In contrast, the government was consistently rated as the least effective delivery mechanism. It points to the growing capacity and enterprise of the private sector and the promise this holds if leveraged carefully.
Building on these overarching findings, the project investigated other topics, like the specific impacts of fertiliser subsidies in India, the role of information transfer to farmers in Bangladesh and the empowerment of women across the region. By and large, these studies continued to add weight to the central finding, that access to quality inputs really matters.
For example, in reviewing the impacts of fertilizer subsidies, the project found that subsidies for fertilizer had limited influence on incomes. The project also concluded that these measures required much better targeting if they are to reach the poor, instead of simply benefiting richer farmers disproportionately. This again brings into question policies that are concerned primarily with the cost of inputs and not their distribution, as was highlighted by the data gathered from experts.
Access was also a key component on the work on extension and information to farmers. It was found that farmers accessing information was positively related to higher incomes and productivity. In a related analysis of mobile phone use by farmers in Bangladesh, better yields, improved production efficiency, and higher agricultural net revenues were all positively related to mobile phone access and use.
In terms of the empowerment of women, the project has found that giving women access to technology can have markedly different and potentially better impacts compared to the same technology in the hands of men. For example, one study showed that women would be more inclined to sell water from a groundwater pump than men, were they given the choice. Obviously, that would require a major shift in the way women's roles are contemplated in the region, but it does highlight the fact that access matters.
Overall, the project presents a significant challenge to the next generation policy makers. How can they design and deliver policies that focus more directly on ensuring access for different groups and focus less on the cost? Subsidies for inputs in agriculture are evidently less favoured by most experts, even if they can be popular in some areas. Phasing them out and replacing them with more targeted and sophisticated support measures can be helped by new technologies spreading rapidly across the region, but the political will to change is the key.
Dr. Mohammad Jahangir Alam is Professor, Department of Agribusiness and Marketing,

Bangladesh Agricultural University, Mymensingh.
e-mail: [email protected]
Dr. Lin Crase is Professor of Economics, University of South Australia, Adelaide, Australia

Share if you like