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Public-Private-Partnership in Agriculture:
A Paradigm Shift Needed
Dr.K.M.SinghDirector
State Agricultural Management & Extension Training Institute, Patna
28th - 30th August 2007
State Agricultural Summit, Bihar - 2007, Hotel Maurya, Patna
Changing Scenario: Agriculture vis-à-vis Market
Globalization and liberalizationChanging consumer interest & preferencesDiversification of food basketQuality food productsValue added/ processed food productsCompetitive prices Raising and stabilizing income over seasons
Shift of Focus in Agricultural Sector
From staples to high value cropsFrom narrow agricultural focus to broader policy
context – including global impactsFrom focus on crop yields to market demands and
incomesFrom primary production to entire food chainFrom agriculture to rural spaceFrom thinking of farms as homogeneous to
heterogeneityFrom public to public-private partnerships, including
community driven developmentFrom avoidance of issues to head on approach
(biotechnology, forestry, water)
Factors challenging Agricultural Sector
Agriculture Sector today:Fixed or reducing ResourcesGrowing economyGlobalization, competition, productivityPopulation growth, resulting into growing demandTechnology, biotech, precision farming
Effects:More sophisticated growers emergingNeed for higher yields/lower costs Value shift from chemicals to seeds Integration of industry partners
New Initiatives in Bihar Agriculture Recent trends in Bihar include:
Specialized & localized productionMarket - led Production & diversificationUse of hybrid seedsUniform qualityContract and Organic farming
Repeal of APMC Act provides opportunities for:Establishment of Market Yards in private sector.Establishment of specialty market.Contract farming Value addition and Processing
Other initiatives include:National Horticulture Mission for Fruits, Vegetables, Spices,
Flowers & Medicinal & Aromatic plantsMacro Management for cerealsISOPOM for pulses, oilseeds & MaizeEstablishment of ATMA in all the districts to bring all
stakeholders on one platform and to promote P-P-P.
Agril. Products from Bihar with high market potential
Cereals like Maize, Rice and Wheat Sugarcane Vegetables, like Cucurbits, Okra. and Brinjal Flowers, like Tuberose, Gladioli, Roses, Marigold Makhana Litchi and Mango Honey and allied products Dairy products Select spices like turmeric, ginger, garlic Aromatic oils like menthol, lemon grass, citronella
Some success stories and opportunities to build in Bihar’s agriculture include
Makhana processing Organic rice Litchi Exotic vegetables Litchi honey Tea Aromatic oils- mentha, lemon grass
Constraints and challenges
Low productivity, due to low level of technology. Poor infrastructure in the rural areas. Unstable and generally low quality production. High transaction costs due to poor post-harvesting
handling, storage, and packaging. Lack of credible market information systems. Lack of experience among local producers in dealing
with developed markets. Limited access to cheap credit. Agriculture generally termed as high risk area for
commercial bank affecting credit flow
Towards Action on Public-Private Partnerships
Key factors for partnerships
Each partner must bring something to the table Common objective Value creation for both Complimentary roles
The way forward
Stop depending too much on the government…
Stop thinking the private sector as greedy and unreasonable Combine the efforts of the public, private sectors and
community (civil society) together to get the best benefits
Opportunities for partnership exist
Partnerships can improve access to:New technologies, and toolsNew research expertise New infrastructurePrivate equity marketsDonor fundingNew product markets and new customers New marketing and distribution networks
Synergies through knowledge sharing, joint learning, scale economies, resource pooling, and cost sharing
But there is a confusion on roles
With changes in the global agri-food system,
the roles of the state, industry, and society
remain contested,Controversy over ownership of new knowledgeIssues over distribution of benefits and risksConcerns over lack of pro-poor emphasisUnease over environmental, social sustainability
Learning from other sectors e.g. the health and ICT sectors
Practical Options
Working together on “how to” Delivery mechanisms and marketing Management tools of research and
innovation Technology collaboration and related
issues Collaboration which could impact rights
on knowledge in public domain
Government’s role: Policy environment Change in mindset
From Regulator to Facilitator Engage in Partnerships for Skills development &
complementation
Legal FrameworkMove to a single window dispensation in spirit & practiceNew legislations be made facilitative rather than
regulatoryEffective IP protection and enforcement across the
boardMultiplicity between centre and states in regulation is
discouraging
Partnerships are taking place but pace needs acceleration.
Industry should focus on national goal of increasing food production in a sustainable manner.
Private investment in agriculture should increase.
Enabling environment is already in place. Several examples of partnership already
exist and can be built upon.
Industry’s Role
Benefits of P-P-P to Private Sector
More competitive locally Expand market for private sector Allows exports in foreign markets
Benefits form Public-Private Consortia Public sector stronger
More money Research more relevant for industry and farmers
Private knowledge of marketPrivate germplasm and technology
Private sector benefits from Technology Access to knowledge
Quality seeds
Corporate involvement
Accessible market
Extension Services
Higher yields
Price support
Concept of Corporate involvementThe corporate extension agencies would ensure supply of quality seeds, extension services, better yields, market access and buy back price support.
Areas of Corporate involvementThe Corporates should ensure forward and backward linkages with the farmers to co-ordinate and promote production and marketing of agriculture produce
Farmer Corporate
Produce quantity and quality as per requirements of Corporate
Provide support in terms of extension services, agri-inputs, credits, farm practices,
markets and fixed price
Typically contract farming will need corporate involvement to address...
Identification of high yielding alternatives which give better returns than conventional farming
Marketing security and technical assistance in a multi-crop program
Removal of infrastructural bottlenecks and enabling regulatory framework
Warehouses / Cold storage chain DryersTransportation
Important Aspects Most Critical Missing Links Potential Consortium Partners
Consumption(Safety & Quality)
Marketing
Processing
Production
1. Identification and estimation of pesticide residues
2. Packaging of the products
1. Demand & supply (domestic & global) analysis
2. Market intelligence
1. Proper grading & Standardization
2. Lack of Uniform production Technology by growers
1. Research on plant protection2. Research on GAP
CENTRAL & STATE INSTITUTES
Policy Research bodies like NCAP, NCAER
Private Sector, Research Institutes
SAU, Private Partners
Farmers Processors Traders/Exporters Consumers Government
Example: Value Chain On Agricultural Products
KVKs, E-Chaupal, ATMAs, FOs, PRIs, KVKs, SHGs
Conclusion
There’s high potential for Partnerships in Bihardue to:
Political stability and visionary leadershipFavorable conditions to produce a variety of
products, Access to preferential markets Constraints being appropriately addressed
systematically. Public-Private Partnerships are crucial for
success.
Agriculture development, agro-industrialization, creation of a proper business environment to
investment are priorities to the Governmental program.
THANKS