Review of Input and Output Policies for Cereal Production in ...

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Tables 3.1—Demand for and supply of improved cereal seed (in tons) 7 3.2—Legal, regulatory, and institutional setup of the seed sector in Bangladesh 8 3.3—Decomposition of Bangladesh’s rice output growth, 1981–2008 10 3.4—Changing fertilizer policy in Bangladesh 15 3.5—Irrigation potential and actual area irrigated in Bangladesh, 2008 18 3.6—Irrigation using surface water and groundwater by different modes, 2008 18 3.7—Public policy changes in the irrigation sector 20 3.8—Farm power and number of equipment in Bangladesh, various years 23 4.1—Major landmarks in Bangladesh’s food policy regime 30 4.2—Public procurement of rice and wheat in Bangladesh ('000 MT) 31 Figures 2.1—Gross domestic product (GDP) and gross domestic product from agriculture (GDPA) and allied: Average annual growth rates, 2000-07 2 2.2—Share of agriculture in total GDP and annual growth rate of GDP and agricultural GDP, 1991– 2008 2 2.3—Share of various sectors in gross value of agricultural output (percentage) 3 2.4—Foodgrain surplus/deficit and foodgrain import/aid, 1972/73 to 2007/08 4 2.5—Rice area, production, yield, 1986/87 to 2008/09, and growth rate in yield, 1998/90 to 1998/99 and 1999/00 to 2008/09 5 2.6—Wheat area and production, 1971/72 to 2008/09, and maize area and production, 1991/92 to 2005/06 5 3.1—Share of rice area under HYV (percentage) and rice yield (kg/ha), 1971/72 to 2005/06 6 3.2—Fertilizer use intensity across South Asian countries (kg/ha of arable land), triennium ending (TE) 2007 12 3.3—Total fertilizer availability (domestic production and imports), 1980/81 to 2008/09 13 3.4—Consumption of pesticides in Bangladesh, 1990–2009 14 3.5—Irrigated area share, cropping intensity, and irrigation by source, 1980/81 to 2004/05 19 3.6—Season-wise share of irrigated area in total cropped area for rice and season-wise rice production, 1979/80 to 2002/03 19 3.7—Farm power available (kW/ha), various years 23 3.8—Trends in public expenditure for agriculture research and extension, 1997/98 to 2004/05 25 3.9—Agricultural credit disbursement as percentage of agricultural GDP 27 3.10—Agricultural credit disbursement by category of lender, 2008/09 28 iv
ABSTRACT In Bangladesh, supportive government policies have played a crucial role in the rapid growth of the cereals sector, and rice in particular. Despite this growth, the country remains a net importer of rice. Even as Bangladesh struggles to achieve food security, the country’s cereal sector faces new challenges. What are these challenges and what should be the country’s response? With these questions in mind, this paper reviews the key policies of agricultural inputs and outputs in Bangladesh that are crucial for improving cereal production in the country. On the input side, the review covers seed, fertilizer and agrochemicals, irrigation/water, farm equipment, research, extension, and agricultural credit. The paper also provides an overview of the policies concerning agricultural output markets, with a particular reference to rice, the main staple crop in the country. The review shows that agriculture, especially rice output, in Bangladesh has grown impressively in the last two decades. A combination of factors seems to have driven these gains: increased access to irrigation; widespread adoption of high-yielding varieties; growth in the use of inputs such as fertilizer, pesticides, and others; and increased efficiency in the output markets. These drivers of agrarian growth received an impetus from the government’s shift in policy of moving away from a largely public sector– controlled structure to one in which private-sector participation gained significance in both input and output markets. The review also shows that despite large gains in efficiency of both input and output markets, several traditional problems continue to plague Bangladesh’s agricultural sector. Landholdings are mostly small and often fragmented, which limits the capacity of farmers to access credit, quality inputs, and modern technology. In addition, the input sectors themselves continue to face many of the traditional problems. The seed sector, for example, is dominated by the informal sector, which is outside any legal, regulatory, or quality-monitoring systems. The agricultural research system, dominated by the public sector, continues to face shortages and volatility in its funding, weak management, and ineffective institutional arrangements for undertaking high-quality and relevant research. The public extension system too faces similar funding, manpower, and institutional shortcomings. Ease of access and the coverage of the formal financial sector are still major problems, despite the rapid growth of a diverse set of players in the financial system, such as banks, cooperative societies, and microfinance organizations. Besides these sector-specific problems, overall infrastructure bottlenecks in the country, such as with transportation and electricity sectors, pose problems in accessing inputs and technologies. Policymakers in Bangladesh are now confronted by numerous new and emerging challenges, which can prove to be a threat to the future of agriculture. Some of these challenges are the result of the negative fallout of current agricultural practices and policies, such as excess groundwater withdrawals for irrigation; decline in soil fertility, some of which is the result of excessive and unbalanced use of fertilizers, pesticides, and other agrochemical inputs; and other problems caused by intensive monocropping of rice. Past policies that aimed at promoting growth have not paid much attention to regulating input use patterns, resulting in some of these negative consequences. Other emerging problems relate to wider changes in the natural environment as well as shifts in world markets and trade, which have consequences for Bangladesh’s agricultural sector. In reassessing its agricultural policies, Bangladesh now has to balance the twin challenges of ensuring sufficient growth in output while promoting judicious use of natural resources to maintain good environmental health. At the same time, the country has to evolve strategies for coping with volatility in world markets through regional solutions with neighboring countries. Keywords: Bangladesh, agriculture, input policies, output policies v
Page 1 and 2: IFPRI Discussion Paper 01199 July 2
Page 3: Contents Abstract v Acknowledgement
Page 7 and 8: 1. INTRODUCTION Bangladesh is a hig
Page 9 and 10: The agricultural sector in Banglade
Page 11 and 12: Figure 2.5—Rice area, production,
Page 13 and 14: Table 3.1—Demand for and supply o
Page 15 and 16: Table 3.2—Continued Bangladesh Ag
Page 17 and 18: account for well over two-thirds of
Page 19 and 20: The spread of chemical fertilizer u
Page 21 and 22: Table 3.4—Changing fertilizer pol
Page 23 and 24: The second major apprehension about
Page 25 and 26: with these phenomena of increasing
Page 27 and 28: From an institutional point of view
Page 29 and 30: Farm Mechanization Use of mechanize
Page 31 and 32: Figure 3.8—Trends in public expen
Page 33 and 34: Agricultural Credit Securing access
Page 35 and 36: 4. OUTPUT SECTOR The previous secti
Page 37 and 38: Table 4.2—Public procurement of r
Page 39 and 40: 5. CONCLUSIONS Bangladesh’s agric
Page 41 and 42: REFERENCES Ahmed, A. U., N. Aberman
Page 43: Jashim, A., and J. Chowdhury. 2001.
Page 48: INTERNATIONAL FOOD POLICY RESEARCH

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