1. Agriculture Marketing Reforms in Bihar, India: A Paradigm Shift Needed
Dr.K.M.Singh,
Director,
Bihar Agricultural Management & Extension Training Institute, Patna
6th June 2007
Presentation in Meeting of the Steering Group on Agriculture,
State Planning Board, Soochana Bhawan, Patna, Bihar, India

2. Changing Scenario: Agriculture vis-à-vis Market
Effects of globalization and liberalization changing the face of the market
Changing consumer interest & preferences
Diversification of food basket
Increased demand for good quality, value added and processed food products
Competitive market conditions
Raising and stabilizing consumer incomes
Food security improving
Improving sustainable farming systems

3. Need for a new Approach to Marketing
Shift from staples to high value crops
From narrow agricultural focus to broader policy context – including global impacts
From focus on crop yields to market demands and incomes
From primary production to entire food chain
From agriculture to overall rural space
From purely public to public-private partnerships, including community driven development

4. Ploughing ahead …..times have changed
Domestic
International Market
Consumer
Consumer
Distributor/Retailer
Exporters
Processors
Brand Marketers
Imports
Aggregators
Mandis
Farmers
Inadequate information with farmers to plan production– Little or no linkages
with the market
Research system with limited connect with the market
Public actions focused on crisis resolution, not at systemic solution
Private sector focus on articulating problem only a few initiatives to show for.

5. Trends in Agricultural Marketing
Recent trends include:
Specialized & localized production
Market - led Production
Diversification
Use of improved inputs
Uniform quality
Contract and Organic farming

6. Marketing of Agricultural Products
Driven by market forces / consumers/ retail
Globalized through international trade
Influenced by new technologies
Subject to stricter regulatory scrutiny
Subject to greater ethical scrutiny
But peoples’ ability to respond to this changing context differs greatly between regions, nations and communities

7. New Initiatives in Bihar Agriculture
Repeal of APMC Act provides
opportunities for:
Establishment of Market Yards in private sector.
Establishment of specialty market.
Contract farming
Value addition and Processing

8. New Initiatives in Bihar Agriculture
Other initiatives include:
National Horticulture Mission for Fruits, Vegetables, Spices, Flowers & Medicinal & Aromatic plants
Macro Management for cereals
ISOPOM for pulses, oilseeds & Maize
Establishment of ATMA in all the districts to bring all stakeholders on one platform and to promote PPP.

9. Bihar’s Strength in Agricultural Sector
Rice, Wheat and Maize
Sugarcane
Fruits and vegetables
Makhana
Litchi
Honey
Dairy products
Select spices
Aromatic oils and Herbs

10. Some success stories and opportunities to build in Bihar’s agriculture include:
Makhana processing
Organic rice
Litchi
Exotic vegetables like snow peas
Honey
Tea in Eastern Bihar
Aromatic oils- mentha & lemon grass

11. Constraints and challenges
Low productivity, due to low level of technology;
Poor infrastructure in the rural areas;
Unstable production and generally with low quality standards for export.
Problems in the post-harvesting handling, storage, packaging and high transaction costs.
Lack of market information systems in the rural areas.
Lack of previous experience in dealing with developed markets and export procedures.
Limited access to credit for farmers due to high interest rates at commercial banks; and
No attractive business for commercial banks due to high risk in agriculture

12. Solution? Moving towards Action on Public-Private Partnerships in Agricultural Marketing

13. Key factors for partnerships
Each partner must bring something to the table
Common objective
Value creation for both
Complimentary roles

14. The way forward …….. Stop depending too much on the government…
Stop thinking the private sector as greedy and unreasonable
Combine the efforts of the public, private sectors and community (civil society) together to get the best benefits

15. Opportunities for Partnership Exist
Partnerships can improve access to:
New technologies, and tools
New research expertise and infrastructure
Private equity markets; donor funding
New product markets and new customers
New marketing and distribution networks
Synergies through knowledge sharing,
Joint learning,
Economies of Scale,
Resource pooling, and
Cost sharing

16. But there is a confusion on roles!
With changes in the global agri-food
system, the roles of the state, industry,
and society remain contested:
Controversy over ownership of new knowledge
Issues over distribution of benefits and risks
Concerns over lack of pro-poor emphasis
Unease over environmental, social sustainability
Learning from other sectors e.g. the health and ICT sectors

17. Practical Options Working together on “how to”
Delivery mechanisms and marketing
Management tools of research and innovation
Technology collaboration and related issues
Collaboration which could impact rights on knowledge in public domain

18. Government’s role: Policy environment
Change in mindset
From Regulator to Facilitator
Engage in Partnerships for Skills development & complementation
Legal Framework
Move to a single window dispensation in spirit & practice
New legislations be made facilitative rather than regulatory
Effective IP protection and enforcement across the board
Multiplicity between centre and states in regulation is discouraging

19. Industry’s Perspective
Partnerships are taking place
Industry wants to focus on national goal of increasing food production in a sustainable manner.
Enhanced private R & D investment is feasible under correct policy environment
An enabling environment is a must
Several examples of partnership already exist and can be built upon

20. Benefits of P-P-P to Private Sector
More competitive locally
Expand market for private sector
Allows exports in foreign markets

21. Benefits form public private consortia
Public sector stronger
More money
Research more relevant for industry and farmers
Private knowledge of market
Private germplasm and technology
Private sector benefits from
Technology
Access to knowledge

22. Concept of Corporate involvement
The Corporates should ensure forward and backward linkages with the farmers to co-ordinate and promote production and marketing of agriculture produce
Farmer
Corporate
Produce quantity and quality as per requirements of Corporate
Provide support in terms of extension services, agri-inputs, credits, farm practices, markets and fixed price

23. Corporate involvement
Concept of Corporate involvement……
The corporate extension agencies should ensure supply of quality seeds, extension services, better yields, market access and buy back price support.
Quality seeds
Corporate involvement
Accessible market
Extension Services
Higher yields
Price support

24. Warehouses / Cold storage chain
Typically contract farming will need corporate involvement to address...
Identificación of high yielding alternatives which give better returns than paddy-wheat rotation
Marketing security and technical assistance in a multi-crop programme
Removal of infrastructural bottle-necks and enabling regulatory framework
Warehouses / Cold storage chain
Dryers
Transportation

25. EXAMPLE: VALUE CHAIN ON AGRICULTURAL PRODUCTS
Important Aspects
Most Critical Missing Links
Potential Consortium Partners
Consumption
(Safety & Quality)
Identification and estimation of pesticide residues
Packaging of the products
Central & State Institutes
Demand & supply (domestic & global) analysis
Market intelligence
Policy Research bodies like NCAP, NCAER
Marketing
Proper grading & Standardization
Lack of Uniform production Technology by growers
Private Sector, Research Institutes
Processing
Research on plant protection
Research on GAP
SAU, Private Partners
Production
KVKs, E-Chaupal, ATMAs, FOs, PRIs, KVKs, SHGs
Farmers
Processors
Traders/Exporters
Consumers
Government

26. Opportunities for Private Sector Investments Corn Oil /Starch Industry
Crop
Processing
Cool Chain
Export
Contract Farming
Ethanol/
Corn Oil /Starch Industry
Modern Rice Mill
Litchi
Honey
Makhana
Banana
Mango
Maize
Vegetable
Aromatic Rice
Fish

27. Final Words
There’s high potential for Partnerships here in Bihar due to:
Political stability
Favorable conditions to produce a variety range of products,
Access to preferential markets
Constraints are being appropriately addressed.
Public-Private Partnerships crucial for success.
Agriculture development, agro-industrialization, creation of a proper business environment to investment are priorities to the Governmental program.

28. THANKS