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WORLD BANK FUNDED

MAHARASHTRA

AGRICULTURAL

COMPETITIVENESS PROJECT

(MACP)

PROJECT IMPLEMENTATION PLAN (PIP)

GOVERNMENT OF MAHARASHTRA

Date: 20th

August, 2010

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MAHARASHTRA AGRICULTURAL COMPETITIVENESS PROJECT (MACP)

PROJECT IMPLEMENTATION PLAN (PIP)

CONTENTS

Chapter No. Component / Subcomponent Page No.

I(i) Introduction 3(ii) Project Development Objectives 6

(iii) Project Design 8

II Project Components

Component A : Intensification and Diversification of Market Led Production

A.1 Market Led Agricultural Technology Transfer 16

A.1.1Institutional Strengthening for Market Led AgriculturalTechnology Transfer

20

A.1.2Preparation and Implementation of Production and MarketingStrategies

26

A.2 Agri Business Promotion Facility 41

A.3 Market Information Services 55

A.4 Livestock Support Services 74

Component B: Improving Farmer Access to Markets

B.1 Promoting Alternative Markets 85

B.1.1 Product Aggregation and sale through Producers Association 87

B. 1.2 Warehouse Receipts Development 101

B. 1.3 Rural Haat Markets 111

B. 1.4 Introducing E-Marketing Platforms 122

B.2 Modernizing Existing Markets 126

B.2.1 Modernizing Wholesale Markets 127

B 2.2 Upgrading Livestock Yards 147

Component C: Project Management

C. 1 Project Coordination Unit and Project Implementation Units 154

C. 2 Environmental & Social Management 160

C. 3 Procurement 169

C. 4 Financial Management 179

C. 5 Monitoring and Evaluation 191

C. 6 Governance and Accountability Arrangements 197

List of Abbreviations 215

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I. (i) INTRODUCTION

1. The Maharashtra State is spread over an area of 3.07 Lakh Sq. km. The total population of theState is 10.3 Crore (estimated 2004-05), out of which, 57.8 % population is dependent onagriculture. Agriculture plays an important role in the States economy. The total number offarmers in the State is 1.66 Crore, of which, 43 % and 27 % are small farmers and marginalfarmers, respectively. The average land holding is 1.66 Ha.

2. In the year 2008-09, the area under cultivation in the State was 22.66 Million Ha, which is73.66 % out of the total physical area of 30.76 Million Ha. In the same year, the area underirrigation was 4.03 Million Ha, which is 17.78%. The food crops including cereals and pulsesoccupy 12.91 Million Ha (56.97%) area. The important Kharif crops are sorghum, millets, rice,

pulses, soybean, groundnut, sunflower, sesame and cotton, while wheat, yellow gram,sunflower are grown in Rabi season. Sugarcane is also grown on a large area in the State. In theyear 2008-09 the production of fruits, viz., grapes, mangoes, banana, oranges, sweet lime and

pomegranate was 100.54 Lakh tonnes, and, the vegetable production had reached the level of77.29 Lakh tonnes per annum.

3. The productivity of important crops in the State is low as compared to average productivity ofthese crops with national averages and averages for many other states. The productivity in other

sectors of agriculture like Animal husbandry, Dairy, Fisheries is also low as compared toNational Averages. The productivity levels in Agriculture are low mainly because irrigated areais low, most of the area is rainfed and though technology is available, it is not being fullyadopted and improved practices are not followed to the full extent by farmers.

4. The data on arrivals of different commodities in Agriculture Produce Market Committees(APMCs) show that there is a good amount of marketable surplus in the State. The data relatingto total arrivals of different commodities and total value of the same for the year 2008-09 are

presented below.

Sr. No. Item Units Particulars

1 No of APMCs in State (Main Market Yards) Number 294

2 No of Sub Market Yards in State Number 612

3 Total Arrivals Lakh MT 2394 Total Value Rs. Crore 32567.00

5 Total Cess Collected Rs. Crore 290.68

6 Supervision fee paid to State Govt. @ 5 Paise / Rs.100 sale Rs. Crore 15.00

7 Total No. of APMCs in surplus Number 241

8 Amount of surplus Rs. Crore 131.18

9 Total No. of APMCs in deficit Number 53

10 Amount of deficit Rs. Crore 20.33

5. Though there is a good amount of marketable surplus in the state, the producers do not get

reasonable price for their produce because of serious deficiencies in the present agriculturalmarketing system. The present marketing system is placed with certain shortcomings, viz., i)

Value chain is too long and fragmented and therefore, particularly in perishables, share of theproducer in the consumers rupee is very low (it is at times as low as 20%), ii) Lack ofstandardization and enforcement of quality and grades, iii) Insufficient and ineffective servicesto the farmers regarding inputs and information, iv) Lack of facilities of grading, packing, coldstorage and processing, v) Inadequate transparency in marketing and vi) Lack of private sectorinvestment. This results in stress to the farmers.

6. This problem could be better addressed through different interventions resting on two pillars,viz., i) Improving Extension support to farmers, and, ii) Improving Agricultural Marketing.

Improving Extension support to farmers

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7. During the mid-nineties, the GOI and WB explored a new approach to extension. The resultwas a new, decentralized extension approach to focus directly on agricultural diversification

and increasing farm income and rural employment. The innovative model revolved around anagency called Agricultural Technology Management Agency (ATMA). ATMA wasintroduced at the district level to integrate extension programme across the line departments,link research and extension activities, and, de-centralize decision making through bottom-up

planning procedures. The concept envisioned involvement of farmers and private sector in

planning and implementation of extension programme at block and district level. The GoM hasalready started implementation of the ATMA model in all the 33 districts of the State. The

project was initiated under the WB sponsored National Agriculture Technology Project(NATP) in 1998 which covered 4 districts, viz., Ahmednagar (1998-99), Amravati (1999-2000), Aurangabad (2000-01) and Ratnagiri (2001-02). It has been extended to additional 15districts in 2005-06 under the Central Government scheme, Support to Extension Reforms.The ATMA model was introduced during 2007-08 under the aegis of WB assistedMaharashtra Water Sector Improvement Project (MWSIP) to Raigad, Nasik, Dhule, Jalgaon,Solapur, Satara, Beed, Parbhani, Nanded, Osmanbad, Nagpur, Bhandara, Gondia andChandrapur Districts. Washim, Amrawati, Wardha, Akola, Buldhana and Yavatmal Districts,which were not already covered by ATMA, were also included in this project in 2006-07. Thus,the ground work for implementing de-centralized extension through ATMA has been done. The

implementation experience has brought out certain inadequacies which need to be addressed tomake the extension more effective.

8. The public agricultural extension system needs improvement at all levels. The knowledge andexpertise of qualified and experienced scientists of Agricultural Universities, ResearchInstitutes, NGOs, Private Sector, and Senior Specialists from Agriculture and other LineDepartments would be tapped to provide training to the district, taluka and village extensionworkers, as well as the farmers. Greater emphasis should be given to working more closely withfarmers on topics such as improved production practices, improving productivity, quality

production, post harvest techniques, processing, market information, market intelligence andadoption of marketing techniques. Modern participatory extension methods based on farmersgroups and associations would be introduced. ATMA has become weak after the closure of

NATP project. ATMA is also considered as the scheme of Agriculture Department, thoughAgriculture as an activity includes Crop Husbandry, Horticulture, Animal Husbandry, Dairy,Fisheries, and Agricultural marketing. Therefore, ATMA needs to encompass the extensionactivities of all these line departments, if it has to be an effective instrument of knowledgedissemination to the farmers.

Improving Agricultural Marketing

9. The key element of Maharashtra Governments agriculture sector strategy is based on overallstrategy of GoI relating to agriculture which stipulates 4% annual growth rate in this and alliedsectors.

10. To ensure better returns of produce to the farmers, agriculture marketing sector needs

strengthening for which GoM has clear policy embodying long term vision for Agriculture

Marketing. The GoM has the Vision: To develop vibrant, transparent, competitive agriculturalmarketing system in Maharashtra by 2015, in which private sector will have very decisive role,and, the State acting as facilitator, resulting in better price to producers, non exploitation of theconsumers, creating huge employment in the sectors allied to agriculture emerging out of

backward and forwards linkages, which will help the economy to grow at faster pace. TheGoMs policy envisages reduction in the number of commodities which can be regulated over a

period of time. As on 31/3/2010 the number of commodities included in the schedule(Maharashtra Agriculture Produce Marketing (Development and Regulation), Act, 1963 ) whichcan be regulated is 138.

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11. Some of the major constraints in achieving better results in these sectors are: (i) Lack ofcoordination among concerned line departments, (ii) No convergence of the schemes, (iii) The

schemes implementation is not integrated, (iv) End to end approach is missing, (v) Inadequateavailability of funds, (vi) Inadequate infrastructure in agricultural marketing system, (vii) Lackof adequate arrangements to carry the marketing information and marketing intelligence to the

producers, (viii) Inadequate risk mitigation measures, and (ix) Lack of alternate marketingsystem, coupled with poor knowledge of agricultural marketing.

12. The State Government has already amended the Maharashtra Agriculture Produce Marketing(Development and Regulation), Act, 1963 (APMC Act) on the lines of Model Act onAgricultural Marketing circulated by Government of India (GOI). The amended Act providesfor various reforms like provision for contract farming, direct marketing, establishing privatemarkets and farmer-consumer markets.

Maharashtra agriculture Competitiveness Project (MACP)

13. The Maharashtra Agricultural Competitiveness Project (MACP) is proposed to address theissues mentioned above. Agriculture comprises of Crop Husbandry, Horticulture, Dairy,Animal Husbandry and Fisheries. The departments that are included in the MaharashtraAgriculture Competitiveness Project (MACP) are Agriculture, Animal Husbandry andAgricultural Marketing. In view of National Dairy Plan and National Fisheries DevelopmentProject being formulated at GoI, Sub-Components / activities pertaining to Dairy and fisherieshave not been included in the project. Explanation: For this project Department of Agriculturemeans Agriculture, Animal Husbandry, Dairy Development and Fisheries Department,Animal Husbandry Department means Agriculture, Animal Husbandry, Dairy Developmentand Fisheries Department, and Cooperation & Marketing Department means Cooperation,Marketing & Textiles Department.

14. Agriculture as an activity is subjected to serious risk of natural conditions & price risk. Studiesin this sector and in dairy and fisheries sectors have been proposed in the project which will beundertaken by independent consultants under the technical oversight of Agri BusinessPromotion Facility (ABPF) and the Project. The results of these studies so conducted, will bereviewed during the First Mid Term Review (MTR) of the project at the end of 2 nd year of the

project. Based on the recommendations of studies decision whether to include activities relatingto dairy, fisheries and agriculture insurance in the project for remaining four years would betaken.

15. The productivity improvement and production of improved quality of various agriculturalproduce is absolutely necessary to make agriculture viable. The thrust so far has been onincreasing the productivity, and therefore, the extension machinery of the departmentsconcerned was targeting to increase the production. Market led extension was totally lackingand this resulted in poor understanding of agricultural marketing by the concerned departmentalagencies and the producers.

16.Various national programmes like Rashtriya Krishi Vikas Yojana (RKVY), NationalHorticulture Mission (NHM), and National Food Security Mission (NFSM) are implemented in

the State. The proposed MACP, with the assistance of the WB, is one of the many steps beingtaken by the GoM, to address the various issues and constraints in development of agriculture.

The components and subcomponents under MACP are based on the ingredients of the overallstrategy of the State mentioned above. MACP aims to enhance the productivity in agricultureand improvement of quality production through capacity building of producers with the help ofATMA programs. In order to enable farmer to fetch competitive price for the agriculture

produce, various alternative channels of marketing are proposed to be developed, besidesstrengthening the present marketing structure, by way of modernization.

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I. (ii) PROJECT DEVELOPMENT OBJECTIVES

1. The Project Development Objective (PDO) and overall objectives of MACP are outlined below.The Project proposes to improve the productivity and quality of produce in agriculture and

allied sector by various interventions proposed under Component A. The objective of better andreasonable returns to the farmer of his produce can be achieved if the farmer access to the

markets is improved. This has been proposed to be achieved by infrastructure development andcreating alternative marketing channels under Component B. For management of ComponentsA & B of the Project, Component C, i.e. Project Management is proposed.

2. Project Development Objective (PDO) is stated as To increase productivity, profitability andmarket access of the farming community in Maharashtra. The proposed MACP aims toachieve the following:

i) Build on the reformed extension system based on Agricultural Technology ManagementAgency (ATMA) concept through training, capacity building and knowledge transfer to thefarmers with emphasis on market-led extension.

ii) Contribute in increasing productivity, and quality of production, diversification of enterpriseand income of farmers, thereby improving opportunities for employment and livelihood

support, both in farm and in the non farm rural economy.

iii) Aim to increase private sector investment in agriculture and allied sectors, and, promotemore effective use of the government funds already being allocated to the line departmentsfor extension and adaptive research.

iv) Improve competitiveness of farmers, to capture increased income generating potentialassociated with a shift in the demand towards high value agriculture and higher quality of

produce to meet greater urban demand.

v) Enable farmers to respond positively to the changes in emerging markets with the supportfor improved product quality, product standards and realization of value additionopportunities.

vi) Assist the State Government to address the critical issues of linking farmers moreeffectively to the markets and to foster the development of efficient and competitivemarketing systems.

vii) Expand market opportunities for the farmers, diversifying marketing channels. It would

establish and strengthen the backward and forward linkages for the farmers throughGrowers Associations and with the help of private partnership.

viii) Encourage private investment in the markets and agri-business in the state.

3. Various components and sub components in MACP and their component-level objective can beenumerated as follows:

Component A: Intensification and Diversification of Market led Production

(i) A1: Market-led Agriculture Technology Transfer (Objective: To increase the productivityof agriculture production by adopting modern technology.)

(ii)A2: Agri Business Promotion Facility (Objective: To create trained manpower to operateand manage the infrastructure facilities.)

(iii)A3: Market Information Services (Objective: To improve market access for enhancing themarketing opportunities for farmers.)

(iv)A4: Livestock Support Services (Objective: To strengthen sources of alternative incometo farmers.)

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Component B: Improving Farmer Access to Markets

(i) B1: Promoting Alternative Markets

B1.1: Product Aggregation and Sale through Producers Association (Objective: Toprovide improved post harvest handling facilities at village level.)

B1.2: Warehouse Receipts Development (Objective: To improve the capacity of farmerson price risk mitigation.)

B1.3: Rural Haat Markets (Objective: To strengthen alternative marketing channel oftraditional rural haats.)

B1.4: Introducing e-Marketing Platform (Objective: To establish e-trading as one of thealternative marketing channels.)

(ii) B2: Modernizing Existing Markets

B2.1: Modernizing Wholesale Markets (Objective: To improve transparency in allAPMCs and to provide basic and productive infrastructure.)

B2.1: Upgrading Livestock Yards (Objective: To improve transparency in all LivestockMarkets and to provide modern infrastructure.)

3. The various interventions are designed in MACP components and sub-components to achieve the

PDO. The Project Outcome Indicators are enumerated below: (i) The share of wholesale andretail price received by the farmer, (ii) Changes in crop yields, (iii) Compliance with businessstandards by office of Director of Marketing, (iv) Degree of price integration across markets inMaharashtra, (v) Changes in farmers house-hold income in real terms.

4. The Intermediate Outcome Indicators are as follows: (i) Farmers adopting improved productiontechniques and management practices in agriculture, (ii) Increase in farm diversification, (iii)

No. of agri-preneurs and PAs (FGs, if available) accessing govt. schemes, (iv) No. of farmersutilizing market information services via SMS, (v) Increase in no. of goats in the target area,

(vi) Commodities aggregated through FGs and FCSCs, (vii) No. of farmers obtainingwarehouse receipts, (viii) Volume and value of sales of market transactions in Rural Haats

(RHs), (ix) Change in lease value of RHs, (x) Volume and value of sales of products traded

through the E-marketing pilots, (xi) Volume and value of sales of market transactions inAPMCs.

5. There are also some important Social and Environmental Indicators such as: (i) Volume oforganic waste generated at targetted mandis, (ii) Representation of women and tribal in marketmanagement committees.

6. As regards to improved project management and satisfactory monitoring and evaluationfollowing are the indicators: (i) Annual project plan prepared, submitted and approved, (ii)Monitoring reports of satisfactory quality submitted every six months, (iii) Submission of 2evaluation reports of satisfactory quality.

7. Considering the project development objectives the Project design has been developed which isdescribed in the following chapter.

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I. (iii) PROJECT DESIGN

1. As mentioned in Chapter I (i), a lot of efforts are being put in by the State Government toincrease the production with the help of technology up-gradation and dissemination oftechnology amongst the farmers. However there are critical gaps existing in the present system,described in Chapter I (i), because of which the producers are not in a position to get the

reasonable value for their produce.2. To address these critical gaps the following Components and Sub-components are proposed in

the MACP. All the subcomponents have been considered in an integrated manner so thatmaximum benefit is achieved by the farmers.

Component A : Intensification and Diversification of Market Led ProductionA.1: Market Led Agricultural Technology TransferA.2: Agri. Business Promotion FacilityA.3: Market Information Services

A.4: Livestock Support ServicesComponent B : Improving farmer Access to Markets

B.1: Promoting Alternative Markets

B.1.1 Product Aggregation and sale through Producers AssociationB.1.2 Warehouse Receipts DevelopmentB.1.3 Rural Haat Markets

B.1.4 Introducing e-Marketing platformsB.2: Modernizing Existing Markets

B.2.1 Modernizing Wholesale MarketsB.2.2 Upgrading Livestock Yards

Component C : Project ManagementC.1 Project Co-ordination Unit (PCU) and Project Implementation Units (PIUs)C.2 Environnemental and Social ManagementC.3 Procurement ArrangementsC.4 Financial Management

C.5 Monitoring and EvaluationC.6 Governance and Accountability Action Plan (GAAP)

3. The various components and subcomponents of MACP mainly focus on the empowerment offarmers as the principal target group. However, the component wise principal target groups andtheir main project related outputs are enumerated in the following table.

Component/

Subcomponent

Principal Target

Group

Main project-related output

Component A : Intensification and Diversification of Market Led ProductionMarket Led AgriculturalTechnology Transfer

Farmers,Extension

personnel

Increased productivity, qualityimprovement of production and better

post harvest handling.

Agri. Business PromotionFacility

Farmers, PGs, PA,specialised agricservice providers,agribusinessentrepreneurs

Intensification and diversificationoptions through advisory services

Market Information Services Farmers,Extension

personnel

Farmers have improved access tomarket information and increasedawareness of market opportunities.

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Component/

Subcomponent

Principal Target

Group

Main project-related output

Livestock Support Services Farmers/Livestock

producers

Sustainability of agriculture as abusiness improved because ofsubsidiary activity

Component B : Improving farmer Access to Markets

Promoting Alternative Markets

Product Aggregation andsale through ProducersAssociation

Farmers, PG &PA

Post harvest management improved andincome to farmers increased.

Warehouse ReceiptsDevelopment

Farmers Warehouse receipt credit is available tothe farmers and distress sale is reduced.

Rural Haat Markets Farmers,Consumers,Traders

Targeted markets are modernized andfarmer access to markets improved.

Introducing e-Marketingplatform

APMCs, Farmers,Traders

Congestion in APMC reduced andfarmer gets advantage of larger market.

Modernizing Existing Markets

Modernizing WholesaleMarkets

APMCs, Farmers,Traders

Targeted markets are modernized andfarmer access to markets improved.

Upgrading Livestock Yards APMCs, Farmers,Traders

Targeted markets are modernized andfarmer access to markets improved.

4. The Objectives, Output & Outcome Monitoring Indicators, Policy & Regulatory Environmentand Proposed / Completed Reforms, Selection Criteria, Activities to be Financed, EstimatedCost, Institutional & Implementation Arrangements, Funds Flow, Fiduciary & SafeguardsArrangements, Governance Risks & Mitigation Measures, and Sustainability are described indetail under each subcomponent.

5. Phase wise implementation: The project would be implemented in all the districts of the State in

phased manner as shown below. After the commencement of the project all the subcomponentsin First Phase districts will be initiated. The Second Phase will start one & half year thereafter

and Third Phase after another one & half year.

Sr. No.Phase IDistricts

Sr. No.Phase IIDistricts

Sr. No.Phase IIIDistricts

1 Amaravati 1 Nagpur 1 Sindhudurg

2 Akola 2 Wardha 2 Ratnagiri

3 Washim 3 Bhandara 3 Raigad

4 Yavatmal 4 Gondia 4 Thane5 Buldhana 5 Chandrapur 5 Nashik

6 Jalna 6 Gadchiroli 6 Dhule7 Aurangabad 7 Latur 7 Jalgaon

8 Parbhani 8 Beed 8 Nadurbar

9 Hingoli 9 Osmanabad 9 Pune10 Ahmednagar 10 Nanded 10 Satara

11 Solapur 11 Sangli

12 Kolhapur

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A brief description of the components of this Project is given below:

Component A: Intensification and Diversification of Market Led Production.

6. This component has four sub-components:

A.1 Market Led Agricultural Technology TransferA.2 Agri. Business Promotion FacilityA.3 Market Information Services

A.4 Livestock Support Services

7. Market Led Agricultural Technology Transfer: Besides infrastructure development proposedunder Component B of the project, a number of activities of capacity building are proposedunder the project so that infrastructure created under Component B is properly operated andmanaged and it gives maximum benefits to the farmers. The programmes of capacity buildingform Component A of the project are going to be implemented in the catchment areas ofactivities under Component B. The objective of this component is to promote intensificationand diversification of agriculture (including crops, horticulture, and livestock) by

mainstreaming the Agricultural Technology Management Agency (ATMA) model of extensionand expanding its scope of activities to include marketing extension, so that improvement

regarding productivity and quality of production is achieved and Farmer gets better value for

his produce.8. The present extension system is largely production centered and little attention is being paid to

agricultural technology transfer. The capacity building programmes including training,demonstrations, field visits proposed under this component will give emphasis on transferringthe agricultural technology. The extension machinery of Agriculture and Animal Husbandrydept. will also be reoriented to carry out agriculture technology transfer besides productionoriented extension activities.

9. All ATMAs require considerable strengthening for effectively undertaking marketing extensionand technology dissemination programs to improve competitiveness of agriculture inMaharashtra. There is no dedicated manpower for the ATMAs, and the ATMA program is

being implemented as a stand alone scheme of the Commissionerate of Agriculture rather than

as a program for promoting convergence and integration of the development and extensionprograms covering crops, horticulture and livestock at the district, block and village levels. TheVANAMATI also does not have adequate resources for capacity building and mentoring ofATMAs in marketing extension. The coordination of the ATMA program with the AnimalHusbandry department and Agriculture Marketing Department needs to be strengthened.

10. Agribusiness Promotion Facility (ABPF): Component B under the Project envisagesimprovement of the existing market infrastructure and creation of new infrastructure.Alternative markets will provide the producer the freedom to make choice of the market. UnderComponent A capacity building programmes have been proposed for improving productivityand quality enhancement. Considering the present level of agricultural production in the State,there is a tremendous potential for development of agribusiness activities. Agribusiness can

provide additional support to the farmers by way of value addition, if these activities are takenup by the farmers / PGs / PAs / Farmers Cooperatives. Agribusiness activities will be related toagriculture production, per se, creating backward linkages, e.g. providing organic manure to thefarmers, and, forward linkages, e.g. food grain handling unit to clean, grade and pack foodgrains. ABPF will be an independent agency which will work in close association with PCU ofthe Project. The ABPF will operate in the catchment areas of subcomponents under ComponentB.

11. The role of the ABPF is to create a body of knowledge, a network of producer / market linkagesand an ongoing flow of useful information which will accelerate the economic development ofagricultural sector of Maharashtra. There will be four major components for ABPF: i) Overall

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co-ordination and implementation of the program, ii) Conduct value chain studies, iii) Studynew business models, and iv) Consultancy studies for (a) carrying out major studies on subjects

like finance, policy and e-trading, (b) relatively short studies on implementation of APMC laws,(c) conducting seminars, workshops, and clinics, (d) bringing out publications, (e) providingtrading support to PGs / FCSC agribusiness, and (f) training for ATMA business advisors, (g)The major Consultancy Studies by ABPF will include study of Dairy, Fisheries andAgricultural Insurance for their possible inclusion as project investment at a later date. The

funding of these studies will be considered at the time of First Mid Term Review (MTR) andassessed whether these components can be included for additional Financing under MACP.These studies will be contracted out by PCU and will be conducted under the technicaloversight of ABPF. Two additional activities, viz. process for facilitating MaharashtraAgribusiness, and Producers Organisation to access GoI grants and process for reviewdiscussion & development of improved designs for wholesale markets will be developed byABPF.

12. Market Information Services: The Component A of the Project aims to improve the productivityand quality of the agricultural produce mainly through training and capacity building offarmers, whereas, the Component B of the Project has the objective of providing improvedmarketing infrastructure facilities for the farmers. In accordance of the overall objective of the

Project, the component of MI empowers the agricultural producers to be able to take advantageof the global opportunities. As the absence of awareness about market information andintelligence is one of the main reasons for inadequate returns in agriculture, there is a need forimprovement in agricultural marketing system including dissemination of market informationand intelligence to the farmers. At present, APMCs disseminate some market information in themarket yards only and that too in respect of the APMCs market area. Considering theglobalization, it is necessary that farmer gets the market information about arrivals, prices, andquality standards of various commodities, not only from one market area, but from other marketareas in the country and if possible from various countries of the world. This will enable thefarmer to have increased access to the markets and will be able to get better prices. MIsubcomponent is designed to upgrade MSAMBs website, and, make market information andintelligence available to the farmers. Likewise, SMS service is proposed to be enhanced for this

purpose. MSAMB will be the implementing agency for this subcomponent with the help of SP.13. Livestock Marketing Development: The existing extension system is poor which affects rapid

growth and sustainability of livestock sector. Small ruminant farmers are disorganized resultingin their poor financial status. Likewise though the meat trade is growing, slaughter houses areunhygienic. The database relating to livestock is also inadequate unlike database for crop sector.Considering these gaps in the livestock sector, the subcomponent for livestock marketdevelopment has been proposed which aims at improvement in marketable healthy livestocksupply and greater access of livestock farmers to the existing markets.

B.1 Promoting Alternative Markets:

14. Produce Aggregation and Sales through Producers Associations: Farmars Common Service

Centers (FCSCs) have been thought as centers for produce aggregation to access alternative

marketing channel to empower the producers. The FCSCs will be small scale commerciallyviable service entities owned and operated by Producers Associations (PAs). The PA may be afederation of the Producer Groups (PGs) of 10-15 active farmer members in each group and 15-20 PGs in a village or cluster of villages within the radius of 5 KM coming together or by 250to 300 producers coming together. The PA may be registered as society under SocietiesRegistration Act 1860 or as Producers Company under the Indian Companies Act 1956. EachPA will have around 250 to 300 members.

15. It is proposed to establish 200 FCSCs of the food grain growers and 200 FCSCs of thehorticulture producers. The FCSCs will have basic infrastructure for aggregation of the

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produce, it's cleaning, grading and packing. It is proposed that 10% of FCSCs will graduate tothe higher level organizations where additional infrastructure like weighing machine, godowns,

auction hall, and cold storage would be constructed. The wholesale marketing activities willtake place at these higher level FCSCs besides aggregation, cleaning, grading and packing ofthe produce. The State Govt. has already issued the Order No. KriViA / CR 47 / C-21, dated 18/11/2008 exempting AgriMarts / AquaMarts, PGs and Cooperatives from the restrictive

provisions about minimum requirements to be fulfilled. This exemption is applicable to FCSCs

also.16. The actual infrastructure to be created at FCSCs will be need based and will be finalized by

FCSC with the help of NGO/ company/any other legal entity as service provider (SP). The SPwill also be responsible for mobilizing groups, formation of PAs and other related activities.

17. Warehouse Receipts Development: The warehouse receipt programme will be promoted tominimize the price risk and make the credit available to the producers against the warehousereceipts through the banks. The Maharashtra State Warehousing Corporation (MSWC), a profit-

making State Govt. undertaking having the main function of warehousing, will be the mainorganization implementing this subcomponent. MSWC has identified 40 warehouses in

Maharashtra for implementing this programme and has entered into an agreement with theNational Commodities & Derivatives Exchange Ltd. (NCDEX).

18. Rural Haat Markets: There are around 3500 Rural Haats in the State. These Haats are managedby the Gram Panchayats at the village level and do not attract the provisions of the APMC Act.Around 300 Rural Haats are proposed to be upgraded in the project. The selection process forthe Haats will be similar to that of the APMCs, i.e. a two stage process of Project Concept Note(PCN) and Full Project Proposal (FPP). The scrutiny of the proposals received will be

performed by the same Approval Committee formed for the scrutiny of the PCN and FPP ofAPMCs. The Rural Haats will be required to provide 10% of their own contribution for basicinfrastructure with balance of 90% from the project. The details of selection, implementation ofHaat activities have been spelt out in the relevant chapter. Ten percent of RH will be consideredfor stage II (productive) infrastructure with 75% grant from the project.

19. Introducing E-Marketing Platforms: As a part of developing alternative marketing channels, E-

marketing to provide virtual trading facilities to the agricultural producers and the respectivetraders is proposed under the Project. The development of this subcomponent will have three

phases. In the first year of the project first phase will be completed involving study of theoptions, policy implications, and alternative technological solutions. The second year willinvolve testing of two alternative virtual market solutions. During the third year and thereafter

up to 6th

year of the project 294 locations will be covered by promoting E-trading activities.

B.2 Modernizing Existing Markets

20. Besides establishing the alternative marketing channel which is the thrust area of this project,the existing agricultural Marketing system, i.e. APMCs and LSMs, need to be provided with

modern infrastructure so that, the farmer has access to wider marketing system. In large numberof APMCs the basic as well as productive infrastructure for agriculture marketing is inadequate.

This component is designed keeping in view the above situation. There are 294 APMCs in theState governed by Maharashtra Agricultural Produce Marketing (Development & Regulation)

Act 1963 (APMC Act). The State Govt. has introduced marketing reforms by amending theAPMC Act in 2006 and the Rules under the Act were promulgated in 2007. These amendmentsare based on the lines of Model Act circulated by GoI. It is proposed to strengthen basic and

productive infrastructure in selected APMCs.

21. This program is designed to promote modernization and improvement of 100 APMCs, 20 LiveStock Markets (LSM) and 4 markets for Small Ruminants (SRs). The APMCs / LSM to be

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included in the modernization and improvement programme will be selected on the basis ofpredefined selection criteria.

22. Selection Process: Project Implementation Unit (PIU-MSAMB) will undertake awarenesscampaign to inform the potential beneficiaries about the project and on the eligibility criteria toaccess the grant. It will make formal calls for proposal and the PIU-MSAMB may decide on thenumber of calls depending on the demand from the participants. PIU, MSAMB would beresponsible for handling all matters of the day to day management of calling and scrutinizingthese proposals. A two-stage screening process will be employed by PIU-MSAMB forscreening of the proposals viz., Project Concept Note (PCN) and Full Project Proposal (FPP).After receipt of the PCN, the same will be examined and short-listing of the eligible institutionswill be done by the Approval Committee consisting of following members. This committeewould be called as PCN Technical Evaluation and Approval Committee. Same committee willfunction as FPP Evaluation and Approval Committee.

i. Nodal Officer - PIU (MSAMB) : Memberii. Sr. Accounts Officer- PIU (MSAMB) : Member

iii. Civil Engineering Specialist - PIU (MSAMB) : Memberiv. Market Field Engineer - PIU (MSAMB) : Memberv. Officer Incharge- APMC PIU (MSAMB) : Member Secretary

The detail selection process has been described under the relevant Chapter on ModernizingWholesale Markets and Upgrading of Livestock yards.

23. Viability Gap Funding (VGF): Objective of the competitive selection process is to provideadditional financial support to eligible bidder viz. VGF, over and above the subsidy that is

available under the Project. The eligible bidder would be selected through a transparent andopen competition where all technical evaluation criteria being equal, the financial supportrequested as VGF, shall be used for selecting the winning bidder. The VGF is available only forthe basic infrastructure and not for the productive infrastructure in APMCs. These criteriawould be used only for the selection of APMCs as the APMCs are required to provide, for basicinfrastructure, 50% of project cost as their own contribution, 25% as the project grant and themaximum VGF upto to 25%. For productive infrastructure APMC would get 25% assistance

from project and 75% will have to be contributed by APMC from own funds. Though actualVGF will be calculated in FPP of the short-listed APMCs by the service provider, the initialshort-listing of APMCs will be based on VGF demanded in PCN provided the other selectioncriteria are met.

Capacity Building & Training:

24. Various training programs are proposed in this project, under Component A, for capacitybuilding and empowerment of farmers, farmers groups, personnel involved in extension

activities of various line departments and the officers and staff concerned in handling andmanagement of infrastructure to be created under Component B.

25. The MACP includes a strong element of capacity building through trainings and exposure

visits. It is estimated that the total number of formal learning courses will amount to over6,600. The SP delivering SMS agricultural information will need to provide training to (i) FieldExtension Officers and (ii) those who will be provided with the SMS service by the project (iii)training to the potential buyers of the SMS service. The SP operating the ABPF will organize

buyer-seller meets, local seminars and trainings to the ATMA Agricultural Marketing Advisers.

26. The bulk of these courses will be provided / organized by the ATMA. The training coursesprovided by ATMA are estimated to be over 4,100 which will be needed to be given tomobilize PGs / PAs and other farmer groupings. A further 2,400 courses will be designed toenable the group to build expertise and understanding the elements of successful operation.These courses will be organized in phases and will include training on markets, access to

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finance, post harvest issues in the first phase, FCSC operation and livestock markets in nextphase, followed by business management and specialized technical training in subsequent

phases. The training of Lady Link Livestock Workers (LLLW), which will be focused in theareas of the new livestock markets, will require 100 courses.

27. In order to prepare the field functionaries and officers to undertake MSS and to be more marketfocused, including the use of market information, following number of courses would beundertaken.

Estimated Number of Courses to be Provided per Project Year (PY)

Particulars PY 1 PY 2 PY 3 PY 4 PY 5 PY 6 Total

PIU, MSAMB 0 27 28 29 29 28 141

SP 0 500 500 500 500 400 2400

ATMA 0 820 820 820 820 820 4100Total Courses Per Year 0 1347 1348 1349 1349 1248 6641

The details of the training programs in Component A and the training cost on various trainingprograms proposed in this project are given in cost tables.

Component C: Project Management

28. For the overall policy issues, a High Power Committee, headed by Hon. Chief Minister ofMaharashtra and all the concerned Ministers as the members, has been constituted. A SteeringCommittee headed by the Chief Secretary has already been set up for coordination in

implementation. The Principal Secretaries of the line departments, the Principal Secretary(Planning) and the Principal Secretary (Finance) are the members of the Steering Committee.

The Principal Secretary (Coop. & Mktg.) has been designated as the Nodal Officer of theProject at the State level. For day to day management of the Project the PCU has been set up at

Pune, which is functioning under the control of the Principal Secretary (Co-operation &Marketing). Similarly Project Implementation Units (PIUs) have been set up for each of the line

department to monitor and supervise the implementation of the activities pertaining to theconcerned departments. The issues relating to Environmental and Social Management,

Procurement, Financial Management, Monitoring and Evaluation, and Governance and

Accountability Arrangements are addressed under Component C.

29. Integrated Approach: MACP has mainly three components viz.: A) Intensification andDiversification of Market Led Production, B) Improving farmer Access to markets, and, C)Project Management. While under Component B, the infrastructure is proposed to be created toimprove farmer access to the markets, under Component A the issue of capacity building of thefarmers has been addressed. The project is so designed that the subcomponents underComponent B and the subcomponents under Component A result in an end to end approach.

30. The subcomponents proposed to create backward and forward linkages in such an integratedmanner that all subcomponents are supplementary and complementary to each other so that theobjectives of project are best achieved. The activities in the subcomponents of Component Awill be undertaken in the catchment areas of the various activities proposed to be taken up

under Component B. This integrated approach has been kept in mind while designing thisproject.

31. Funding pattern and mode of release of Funds / Financial Arrangements: The funding patternfor the subcomponents in the project will be as shown in table below:

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Sr. No. Component & SubcomponentProject and GoM

Contribution*%

Beneficiary

Contribution%

A. Intensification and Diversification of Market Led ProductionA.1 Market led Agri. Technology Transfer 100.0 -

A.2 Agri-Business Promotion Facility 100.0 -

A.3 Market Information Services 100.0 -

A.4 Livestock Support Services** 100.0 -B.1 Promoting Alternative Markets

B.1.1 Product aggregation and sale through Producers Associations

-- Stage-I Investments 75.0 25.0

-- Stage-II Investments 50.0 50.0

B.1.2 Warehouse Receipts Development 100.0 -

B 1.3 Rural Haats Markets

-- Basic Infrastructure (Stage I) 90.0 10.0

-- Productive Infrastructure (Stage II) 75.0 25.0B.1.4 Introducing E-Marketing Platforms 100.0 -

B.2 Modernizing Existing MarketsB 2.1 Modernizing of Wholesale Markets

-- Basic Infrastructure*** 50.0 50.0

-- Productive Infrastructure 25.0 75.0

B 2.2 Upgrading Livestock Yards

-- Basic Infrastructure 100.0 -

C. Project Management

C.1 PCU & PIUs 100.0 -

* This includes 10% from GoM funds and 90% from Project funds.

** 100% grant for capacity building and 50% grant for Supply of buck & Chaff-cutter.

*** Includes 100% grant for setting up computerized auction system.

32. The total cost of the Project is estimated at Rs. 703.95 crore, out of this the World Bankcontribution would be around Rs. 461.21 crore (65.52%), the beneficiary contribution would be

Rs. 191.02 Crore (27.13%) and State Governments contribution to be Rs. 51.72 Crore (7.35%).

The fund flow arrangement in the project would be largely based on the Budget DistributionSystem (BDS) (electronic fund transfer) except for some components where funds will flowthrough BDS up to a particular stage & beyond that, these will be kept in separate bankaccounts to be operated by designated authorities. The States mainstream accounting systemmaintained by the State Accountant General (Accounts and Entitlements) / monthly Drawing &Disbursing Officer (DDO) accounts The fund flow arrangement of the project has been speltout in chapter on Financial Management, wherein the stages of fund disbursement and the rolesof Drawing Disbursing Officers (DDOs) have been defined. All these Subcomponent aredescribed in the following Chapters giving details of activities to be supported by activity

schedule, cost estimates and other relevant information.

***

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COMPONENT A

INTENSIFICATION AND DIVERSIFICATION OF

MARKET LED PRODUCTION

A.1 MARKET-LED AGRICULTURALTECHNOLOGY TRANSFER

I. Objectives:

1. This component aims to improve the competitiveness of small farmers that would allow them tocapture increased income generating potential associated with a number of emerging trends inIndian agriculture, including: (i) shifting demand towards high value agriculture and higherquality of produce, (ii) greater urban demand, and (iii) the move of large corporations intoagricultural marketing. The project intends to put in place a process that would empower smallfarmers to be able to respond positively to these changes in the food market by creatingenabling conditions and support for production systems diversification, increased farm

productivity, improved product quality and standards, and realization of value additionopportunities.

2. The project would support models that allow farmers to obtain a larger slice of the retail rupeeby fostering the establishment of forward linkages and the emergence of balanced, efficient andopen supply chains. Doing so would open up a third marketing front, besides existingregulated markets and direct purchase arrangements. The direct purchase arrangements ascurrently pursued by large corporations also run the risk of excluding small farmers and

potentially marginalizing farmers into becoming providers of raw materials in closed supplychains. The project offers the prospects of both improved prices for producers and increased

productivity that better match with consumer demand. The farmers should be enabled to tunetheir production to changes in demand and to take advantage of new and alternative marketingchannels as well as the potential of new technologies.

3. The GoM has already initiated actions to implement Agricultural Technology ManagementAgency (ATMA) model of agricultural extension in all the 33 districts of the state. The ATMAmodel was introduced in Ahmednagar, Amravati, Aurangabad and Ratnagiri districts under theaegis of the National Agricultural Technology Project (NATP) from 1998 to 2004. It wasextended to 19 districts, including previous four ATMAs, in 2005-07 under centrally sponsoredscheme Support to extension programme for extension reforms. The remaining 14 districtshave adopted the ATMA model of extension during 2007-08.

4. The implementation experience has brought forth certain deficiencies in the working ofextension system. The main reason for this is that the ATMA concept is being implemented as astand-alone scheme of the Department of Agriculture rather than as a program for promotingconvergence, integration and inter-departmental coordination at the district, block and village

levels. The major constraints are:

Lack of convergence in programs of different line departments.

Lack of provision for dedicated manpower at various levels. Inability to use funds allocated by GOI for ATMAs.Lack of infrastructural support below district level.

Inadequate support for growers associations and farmers organizations. Inadequate focus on market-led extension.

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5. In this context, knowledge and technology transfer will play an important role, something thatthe project aims to achieve by creating conditions that would allow the ATMA based model of

extension to reach its full potential. In addition, the project intends to make agricultural marketsmore efficient by creating enabling conditions and support for reducing spoilage, generatingeconomies of scale in output marketing and input supply, and fostering increased competitionamong the buyers of agricultural produce.

6. Marketing extension employs the same best practices as in production extension, in that itfocuses on enabling farmers to learn for themselves (i.e. experiential learning) but the focus ison empowering producers to be able to engage directly with the market. The processesnormally involve the extension officer taking a group of farmers through a semi-structuredtraining course. Topics include resources audit, simple economic and costing analysis, carryingout own market research, direct interaction with the traders, training in post-harvest handlingand marketing planning. There is a need to include traceability, sanitary and phyto-sanitarystandards in the training programs for line department staff and farmers.

7. This component will facilitate intensification and diversification of production by:

making extension and adaptive research more relevant and accessible to farmers;

encouraging the introduction and adoption of more effective agricultural production

systems; reducing the risk associated with change, especially for small operators; and focusing on marketing extension.

8. This will be primarily addressed by mainstreaming ATMA activities, and improving the ATMAfocus on market-led extension. The scope of Strategic Research and Extension Plans (SREPs)

prepared under the centrally sponsored scheme will be enlarged to cover marketing extensionand marketing related activities. Since the SREPs for most of the districts have recently been

prepared, for each district a Marketing Strategy Supplement (MSS) will be prepared which willsupplement the agricultural production enhancing aspects covered under the SREPs.

9. The project component A seeks to focus on the strengthening ATMA programme to facilitatemarket-led extension. This will call for reorientation of the extension functionaries to focus on

improved productivity, quality, market information and improved methods of marketing basedon the updated market information and intelligence. This renewed focus on ATMA extensionsystem would necessitate strengthening ATMA by institution and operation, making themvibrant and efficient to face the emerging challenges in agricultural production, marketing andagri-business.

10.The focus would be on ways and means for developing and strengthening interdepartmentallinkages to support not only Farmers Common Service centres (FCSC) but also for providingsupport to the farmers in all the districts to achieve increased income from their land basedoccupations involving crops, horticulture and livestock. The effort would be to implementATMA programme as an integrated, demand-led and farmer-centered programme of all linedepartments with special focus on marketing extension in all the districts of the state.

11. The SREPs for all the districts in Maharashtra have recently been prepared and cover theproduction aspects of field crops, vegetable, fruit, ornamental, spices and medicinal plants andlivestock. Under this Project the Marketing Strategy Supplement (MSS) to the SREP will be

prepared for each district focusing on what needs to be done to improve market- led production,marketing related training of line department staff and farmers and linkages with theinvestments proposed for improving marketing infrastructure under component B of the project.

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II. Outcome and Output Monitoring Indicators:

12. The outcome and output indicators are as follows:

Sr.No.

Outcome Indicators

1 Increase in productivity of the agriculturalproduction

% increase in productivity of important filedand horticultural crops.

2 Increase in cropping intensity. % Increase in cropping intensity.

3 Shift towards high value crops. % Shift towards high value crops.

4 Increase in marketed surplus. % Increase in marketed surplus.

5 Increase in producer price realization. % Increase in producer price realization.

6 Savings from reduction in spoilage. % Savings from reduction in spoilage.

7 Reduction in marketing cost. % Reduction in marketing cost.8 33 ATMA strengthened and functioning

regularlyNumber of ATMA strengthened andfunctioning effectively.

9 66 FIAC set up, strengthened andfunctioning

Number of FIAC strengthened andfunctioning effectively.

10 Officer Sensitization workshopsorganized (66)

No. of Officer Sensitization workshopscompleted

11 Documentation of success stories andSpecial Studies completed

No. of success stories and special studiescompleted and presented

12 State level workshop conducted (12) No. of State level workshops conducted

13 Strengthening of VANAMATI (1) % increase in no. of participants trained

14 Strengthening of Horti. ProcessingTraining Center, Aurangabad (1)

% increase in no. of participants trained

15 Strengthening of Animal Husbandry

Training Center, Pune (1)

% increase in no. of participants trained

16 Total number of activity schedulesdeveloped by ATMA (33)

% of targeted number of activity schedulesdeveloped by ATMA

17 Total number of approvals of MSS by

ATMA (33)

% of targeted number of approvals of MSS

by ATMA18 Total number of trainings (batches)conducted(24+84+4100+500= 4708)

% of total targeted number of trainings(batches) conducted

19 Total No. of FIG / CIG / PG formed(6700)

% of total targeted number of FIG / CIGformed

20 Total no. of demonstrations organized(Crop Demo. 13050 + Org. Fmg. 380 +Post HM 1000 + Animal WF 1500 +

Fodder Pdn. 2500 = 18430 )

% of total targeted number ofdemonstrations organized

21 Total no. of buyer-seller meets organized(170)

% of total targeted number of buyer-sellermeets organized

22 Total no. of exposure visits organized

(141)

% of total targeted number of exposure

visits organized23 Strengthening of growers associations /

farmer organizations (15)% of targeted growers associations / farmerorganizations strengthened

24 Total Innovative pilots implementedsuccessfully (57)

No. of Innovative pilots implementedsuccessfully

Note- CIG / FIG / PG would be the focal point in the catchment area of activities aroundinfrastructure described in Component B and the activities as described above would be suitablycarried out by each CIG / FIG / PG as per their need based demands. Sub-division of all the above

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activities in a project mode under each initiative of Component B would be the precondition forrelease of project funds to ATMAs.

III. Policy and Regulatory Environment:

13. Following are the issues related to policy & regulatory environment:

i. Department of Agriculture (PIU-Agriculture) is the main implementing agency of thiscomponent. It is the only agency at present for agri-extension.

ii. It envisages the strengthening of the various institutions within the framework of thebusiness rules of those concerned institutions to expand their role in extension.

iii. The implementation of the component will be guided by the Inter Departmental WorkingGroup (IDWG) and its sub-committee on policy and regulatory matters related to extension.

iv. ATMA is a district level organization under the chairmanship of the District Collector. Allthe districts in Maharashtra are covered. This structure needs to be the main focus point ofmulti-players extension policy.

This component is described under two sub component namely i) Institutional Strengthening

for Market-Led Technology Transfer ii) Preparation and Implementation of MarketingStrategies.

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A 1.1 - INSTITUTIONAL STRENGTHENING FOR MARKET-

LED TECHNOLOGY TRANSFER

I. Selection Criteria:

1. All ATMAs and Government Training Institutions of the line departments are considered for

strengthening under the Project.II. Activities to be financed:

2. For improving market-led extension in Maharashtra, an assessment of ATMAs have indicatedthe need for strengthening ATMAs in terms of manpower, physical facilities and financialsupport; and promoting inter-departmental coordination at the state, district, taluka and villagelevels. The activities to be supported under this sub-component include:

Strengthening of ATMAs

Strengthening of Farm Information and Advisory Centers (FIACs) Strengthening of Inter-Departmental Working Group (IDWG) and Inter-Departmental

Coordination

Strengthening of ATMAs

3. Contractual Services of Agricultural Marketing Expert: The focus of extension would shift fromproduction to productivity, quality of production, marketing and increased income of thefarmers. This would be achieved by following good agricultural practices, cost effective andintelligent marketing of the farm produce. Increased emphasis would be placed on post harvestmanagement, value addition, traceability. This would create a number of agri-businessopportunities culminating in formulation of bankable projects, commercialization / business

plans. The Common Interest Groups / Farmers Interest Groups (CIGs/FIGs) getting organizedaround a particular commodity for services would need to be guided, mentored and facilitatedto capture emerging marketing and agri-business opportunities. The present structure of ATMAdoes not have expertise in this field. The marketing extension to be strengthened through this

project would necessitate having the services of one agricultural marketing expert in eachATMA. The marketing expert would be supported by an accountant and computer operator atthe district level. This unit of three persons would function under the Project Director ATMA.The services of this unit would, however, be available to all line departments (Agriculture,Animal Husbandry and Agril. Marketing) of ATMA. This functional unit of marketingextension would also constantly liaise with ABPF at state level, so as to get inputs and guidanceregarding programme implementation and development of location specific strategies. It will bein touch with the service providers facilitating setting up of FCSCs. It will help in developingMarketing Strategy Supplement (MSS) to the SREP for the district and identify specific

production and commercial activities to be focused on every year. The services of agriculturalmarketing expert, accountant and computer operator would be hired on contract for the project

period in all the districts.

4. Equipment, IT and other support for ATMAs: The project will support need based equipment,computers, IT and internet facilities, renovation and rehabilitation of office. Support will also

be provided for operational costs, special studies, formation and training of FIGs, farmerfederations and commodity associations, preparation of CDs, videos. The provision forinformation technology support would be available at district / FIAC level which would beshared with the relevant line departments involved in MACP.

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Strengthening of FIACs:

5. The Farm Information and Advisory Centre (FIAC) will act as the extension planning andoperational arm of ATMA. It is a common meeting point for line departments to preparedetailed extension programme and coordinate their implementation at the taluka level. It is alevel where farmer input can be effectively mobilized through a Farmer Advisory Committee(FAC). The FIACs are housed at Agri Clinics / Taluka Seed Farms at taluka level. Support will

be provided for setting up two FIACs in each district. The selection of blocks where FIACs willbe set up will be linked with the locations where improvement of marketing infrastructure issupported under component B.

6. Special studies: The market potential of major commodity and supply chains in a given districtneeds to be assessed. This will help agri-preneurs and farmer groups to suitablyorganize/modify their business activities taking into consideration the marketing potential. Thestudy of this nature requires expertise in agri-marketing /agribusiness. The informationgenerated through this kind of special studies will be shared with FIACs, agri-preneurs and

other stake holders. The special studies would be got done by the reputed experts in privatesector through ABPF.

The detailed cost estimates for strengthening of ATMA are given in the Cost Tables.

Strengthening of marketing extension and agribusiness capabilities of VANAMATI, othertraining centers of line departments:

VANAMATI:

7. Contractual staff for Agricultural Marketing, Agribusiness and Monitoring and Evaluation: It isnecessary to shift extension focus from production-orientation to market-led extension forincreasing farm income by adopting end-to-end approach. Market-led extension will helpfarmers to minimize the production costs, improve the quality of farm produce, access emergingmarkets, increase the value of produce, resulting in increased income. VANAMATI will help intechnical backstopping, training, capacity building and mentoring of ATMAs with greater focuson market-led extension and sensitization of senior officers of the line departments about theATMA concept and approach. For this purpose it is proposed to strengthen VANAMATI. For

enhancing the managerial capabilities of members of ATMA Governing Board, BTT, FIAC,separate training programmes will need to be organized by VANAMATI. For this purpose oneAgricultural Marketing Expert, one Agri-business Specialist, one Monitoring and EvaluationSpecialist and one accountant with computer knowledge will be hired on contractual basis andresource persons will be hired from other organizations as per need. To prepare districtMarketing Strategy Supplements, special trainings will be organized for extension personnel by

VANAMATI. The field level data collection, compilation and preparation of MSS shall bedone by the district extension staff and ATMAs under the guidance of VANAMATI.

8. The contractual staff to be hired includes one Agricultural Marketing Expert, one AgribusinessSpecialist, one M & E Specialist and one Accountant with Computer skills.

9. Capacity building of VANAMATI faculty members: The focus of agriculture extension system

has to be on increasing productivity, improved marketing and enhanced farmer incomes. Theentire extension machinery in the project areas has, therefore, to be reoriented to createawareness and understanding about increasing farm productivity and enhancing income offarmers through effective marketing. It would require expanding knowledge base and marketingskills and techniques by the extension management personnel. The VANAMATI being the apexagricultural extension management institute in the state, its faculty members must get trained inthe concept and practices of market-led extension and agribusiness to provide leadership andtraining to the master trainers and district agricultural extension officers. The RAMETIsworking at regional level should also have faculty members competent in this area. The trainingcurriculum would include grading, packaging, certification, Agriculture Marketing Act, Rules,

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contract farming, quality production, GAP, GMP, HACCP, traceability, Agmark, organiccertification, market led extension, commodity exchanges, agribusiness opportunities. The

Additional Director of VANAMATI along with two faculty members and one faculty membereach from seven RAMETIs would be trained under the project at MANAGE, Hyderabad. Inaddition to the above members 3 persons from the PIU-Agri. will also be sent to MANAGE,Hyderabad for the training. Thus a total of 13 persons will undertake training at MANAGE.There would be five day intensive training programme. The training would aim at making the

faculty members expert in this area of knowledge. The cost of this training is shown in the costtable. Similarly, 17 officers from the AHD department will undertake training at IIM,Ahmedabad, the cost of which has been shown in the cost table.

10. Preparation of Training Material and Organizing Trainings: For shifting the emphasis ofextension, the apex and regional agricultural extension management training institutes will berequired to get a team tuned to and geared up for imparting training in market led extension tothe field extension functionaries. These training institutes would be required to develop trainingmaterial such as training modules, manuals, CDs, videos. Support will also be provided forneed based training equipment. The project will provide funds for training of core team for

preparation of Marketing Strategy Supplements to SREPs for each district, organizing othertrainings, operational funds, TA, DA, vehicle hiring .

Support to Line Department Training Institutes:

11. Horticulture Processing Training Institute (HPTI): The Horticulture Processing TrainingInstitute Aurangabad, working under Agriculture Department would focus on giving training towomen farmers with the objective of turning them into small scale entrepreneurs in agri-

processing. Being a mobile training institute, the response to this kind of training wouldincrease manifold. The training courses are designed for three to five days. Having regard toimportance of training, the HPTI which lacks laboratory and training equipment at present will

be supported under the project for acquiring the required facilities. The project would provideinvestment of Rs. 23.00 Lakh spread over the project.

12. Animal Husbandry Training Centre: The Animal Husbandry Department has a state leveltraining centre in Pune which runs short term training courses for livestock development

officers and livestock supervisors. This training centre is in need of training material andequipment for running effective courses. The courses to be run in this center would also needto be refocused with market-led extension concept as envisaged in the project. Five hundredLivestock development Officers and Live Stock Supervisors from the catchments area ofselected 20 LSM and 4 SRM in MACP will be trained in this institute for marketing

management, disease management etc. 3-5 days course will be conducted. It will be beneficialto motivate and train cattle owners within catchment zone. It will reflect in the increased

number of cattle owners taking benefit of developed LSM and SRM under MACP. This will bea strong backward linkage for the development of LSM and SRM component.

The cost estimates of these sub-components are given in cost tables of AHD

13. Sensitization workshops: Although the ATMA model of agricultural extension was introduced

in the state in 1998, the spirit, objectives and methodology of functioning of ATMA are notfully understood by all line departments. Better awareness and understanding of ATMA model

of extension is required at state, regional and district level. The heads, regional heads anddistrict level officers of line departments would therefore need to be exposed and oriented inthis approach of extension system. The state level one day workshops for state and regionallevel officers would be organized. This would help bring about integration in interdepartmentalworking and facilitate clear guidance from the state and regional level officers to district levelofficers. The Commissionerate of Agriculture would organize State level workshops whiledistrict level workshops will be organized by P.D. of respective ATMAs. This will also

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facilitate appreciation of the MACP and the strategy for implementing market-led extensionthrough the ATMAs.

14. Documentation of success stories and special studies: It is envisaged that the implementation ofMACP would generate a number of success stories across the project area involving all linedepartments. The typical success stories need to be replicated to enhance the success of project.This would prove as a stimulus for the ordinary farmers to undertake enterprising activity indifferent spheres of development. Print and electronic media would need to be tapped todisseminate the success stories to as large a number of farmers as possible. The style of writingsuccess stories and treatment of subject is different from normal scientific write up. To makethe success stories appealable and generate curiosity; the style of writing has to be crisp. Thiswould be best done by outsourcing the work to professional organization having adequateliaison with media.

Nodal Unit/ Project Implementation Unit (PIU) Agriculture:

15. The project will provide funds for strengthening of the Nodal Unit/PIU Agriculture in theCommissionerate of Agriculture which serves as a secretariat for the Inter-DepartmentalWorking Group (IDWG). This will include full time Nodal Officer of rank of Class-I Officerfrom the Department of Agriculture, Agriculture Officer and Agriculture Supervisor(designated as Community Extension Officer) from the Department besides the contractual staff(Agricultural Marketing Expert, Procurement Officer, Accountant with Computer skill, 2assistants with computer knowledge and two messengers), need-based renovation of office andfurniture, computer and other need based equipment, state level workshops, orientationworkshops, special studies, consultancies, operating costs, TA, DA, vehicle hiring. The nodalunit would be headed by the Director Extension & Training. This unit would act as a link

between Interdepartmental Working Group (IDWG), ATMAs, other PIUs and Project Co-ordination Unit (PCU) of MACP. It will guide, supervise and monitor project implementationand initiate corrective actions for effective project implementation. This Nodal Unit will alsoact as Project Implementation Unit for the project in the Department of Agriculture. The costestimates for PIU Agriculture are given incost tables attached in Appendix A1.(i).

III. Estimated costs:

16. The total cost of this component is Rs. 2230.90 Lakh).

IV. Institutional and implementation arrangements:

17. The implementing department for this subcomponent is Agriculture Department with the helpof the field staff located up to taluka level. The active support and help of all the linedepartments will be taken. Each ATMA will have a Project Director and the District Collector

being the Chairman of ATMA will coordinate all the departments.

18. The Inter-Departmental Working Group (IDWG) which was set up in 1998 under the WorldBank funded National Agricultural Technology Project (NATP) will give overall policydirections for the functioning of ATMA. For this IDWG needs strengthening for which

measures are contemplated under the Project.

19. The key functions of IDWG are:

To provide a mechanism for interactions with the Technology Dissemination ManagementCommittee of the Department of Agriculture and Cooperation, GOI; guide the humanresource development programs and to monitor the district level technology dissemination

programmes;

To oversee and support agricultural extension and adaptive research activities beingundertaken by the ATMA; and to make policy interventions on inter departmental matters,

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including policy harmonization and coordination at the state, district and lower level, andissues related to women in agriculture;

To promote and establish integrated approach in transfer of technology at state, division,district and taluka level by agriculture and the relevant line departments;

To establish effective linkages with different line departments; marketing, input and creditinstitutions; NGOs, private/corporate sector to promote large scale extension reforms;

To internalize new concepts, operational and institutional arrangement which havesuccessfully worked under the pilot ATMAs set up under NATP; and

To deal with any other policy and administrative issue related to implementation of theATMA program, which emerge from time to time.

20. The composition of Inter-Departmental Working Group (IDWG) is as under:

Sr. No. Designation1. Principal Secretary ,Agriculture Chairman

2. Principal Secretary, Planning or his representative Member3.

Secretary, Finance or his representative Member4. Secretary, ADF Member5. Secretary, Rural Development or his representative Member

6. Secretary, Tribal Development Member7. Secretary, Social Justice Member8. Secretary, Water & Soil Conservation Member9. Secretary, Women & Child Welfare Member10. Vice Chancellor, Dr. Punjabrao Deshmukh Krishi

Vidyapeeth, AkolaMember

11. Vice Chancellor, Marathwada Krishi Vidyapeth, Parbhani Member12. Vice Chancellor, Dr. Balasaheb Savant Konkan Krishi

Vidyapeeth, DapoliMember

13. Vice Chancellor, Mahatma Phule Krishi Vidyapeeth, Rahuri Member14. District Collector of concerned 16 districts Member

15. Commissioner ( Agriculture) Member

16. Commissioner ( Animal Husbandry) Member17. Commissioner (Dairy Development) Member

18. Commissioner (Fisheries) Member19. Commissioner (Cooperation) Member

20. Commissioner (Sugar) Member21. Director (Marketing ) Member

22. Director, VANAMATI, Nagpur Member23. Managing Director, Maharashtra Agro Industries

Development Corporation Ltd., Mumbai

Member

24. Managing Director, Maharashtra Sate Seeds Corporation Ltd.,Akola

Member

25. Director (Extension and Training), Commissionerate ofAgriculture, Maharashtra State, Pune

MemberSecretary

Note: It is proposed to include Principal Secretary, Co-operation and Marketing as member ofIDWG. District Deputy Registrar of Co-operation department will be included as member ofrespective ATMA.

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21. In view of the large size of the IDWG, the following Sub-Committee of IDWG will provideoversight and coordination of MACP activities related to this component:

Sr.

No.

Designation

i) Commissioner ( Agriculture) Chairmanii) Commissioner ( Animal Husbandry) Member

iii) Director (Marketing ) Memberiv) Director, VANAMATI, Nagpur Memberv) Project Director (MACP) Membervi) Director (Extension and Training) Commissionerate of

Agriculture, Maharashtra State, Pune Member Secretary

The sub-committee will meet once every quarter (more frequently in the early stages of projectimplementation) to review implementation progress of Component A of MACP.

22. Enhancing Effectiveness of IDWG: Although the IDWG was set up in 1998, the inter-departmental coordination for implementing the ATMA programme continues to be weak.Under NATP, the ATMAs in Maharashtra performed very well but have weakened since theclosure of NATP in June 2005. For making the ATMAs vibrant and robust institutions, it is

imperative to have an effective and efficiently functioning IDWG. Since the fieldimplementation of different activities will be undertaken by the line department staff at districtlevel and below, it is necessary that heads of the departments convey clear message to theirfield staff that ATMA activities are as important as the specific schemes implemented by theirdepartments and should not be considered as additional burden on the field staff. Unless policyharmonization, convergence and integration of extension and support programs of all the linedepartments related with agriculture (crops, horticulture, livestock, marketing, credit) happen atthe state level and is clearly conveyed to the field staff, it will be difficult to achieve optimumresults on the ground. The pro-active role of IDWG is therefore critical.

23. In order to improve the efficiency and effectiveness of IDWG following steps are proposed:

Regular half yearly meetings of IDWG, appropriate timely follow up of the IDWG

decisions by the concerned line departments, and reviewing compliance in the followingmeetings;

Strengthening the Nodal Unit in Commissionerate of Agriculture for organizing IDWGmeetings, undertaking follow-up actions, identifying implementation issues and findingsolution to implementation bottlenecks; and

Undertaking pro-active actions to promote inter-departmental coordination and integrationof on-going programs; and

Regular review of implementation progress of ATMA programs, and take remedial actionsto address implementation bottlenecks.

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A1.2 PREPARATION AND IMPLEMENTATION OF

PRODUCTION AND MARKETING STRATEGIES

I. Selection Criteria:

1. The selection criteria for the various activities under this subcomponent are as follows:

(i) The officers and field functionaries from various line departments who are concernedwith the implementation of various activities under the project will be selected fortraining.

(ii) The farmers from the catchment area of various activities under Component B will onlybe considered for farmers training and demonstrations.

(iii) The farmers selected for training will only be considered for field visits within andoutside the state and demonstrations.

(iv) The farmers from the catchment area of various activities under Component B will onlybe considered for formation of CIG / FIG of food grain growers, horticulture farmersand animal husbandry farmers. They should be willing to participate in group activity

and share financial and regulatory responsibility. They should also be the producers ofthe agriculture produce for which the CIG / FIG is proposed to be formed.

(v) For agri-business development in the Project area, the potential SME including womenwill be selected by the SP and they will be trained for taking up agri-businessdevelopment activities.

II. Activities to be financed:

2. The following activities have been identified on the basis of SREPs and the general informationthat is currently available. These are for cost estimation purposes and may undergo somechanges as the project implementation starts and Marketing Strategy Supplements (MSSs) are

prepared.

A) Preparation & Implementation of MSS and SREP :

3. All the districts in Maharashtra have already prepared the district Strategic Research andExtension Plans (SREPs) which include various agricultural extension activities for increasingagriculture, horticulture and live stock production. To give focussed attention to market-ledextension each ATMA district would prepare a Marketing Strategy Supplements (MSS) to theSREP. The MSS will be developed under the guidance of experts in marketing extension andagribusiness based in the VANAMATI Nagpur who would be trained and oriented in theconcepts and procedures of preparing MSS and market-led extension at the MANAGE,Hyderabad. They would become resource persons to guide, mentor and facilitate district teamsto prepare MSSs.

4. Preparation of MSS in each district would follow following steps in logical sequence

Step I: Orientation of District Core Team

Step II: Training of AES team

Step III: Data collection, and data analysis and, identification and prioritization of researchand market led extension issues

Step IV: Developing strategies for market led extension and focusing issues, developingoutline /framework for MSS on the basis of the project thrust area

Step V: Developing activity schedule and approval of MSS by ATMA

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The activities under component B will be kept in view and linkages will be developed with thesame for improving the markets.

5. The process of preparing MSS will be led by the Agricultural Marketing Expert in the ATMAand would involve the district level officers of all line departments. The district core team aftergetting training from expert team at VANAMATI would train AES teams involving taluka levelofficers of all line departments in data collection and data analysis. The development ofstrategies, activity schedule would be carried out by the district core team, under the guidanceof state level facilitators. The preparation of MSS would be closely monitored by the PIU of theline departments. Necessary guidance and assistance would be provided to the districts fromstate level. The process of preparation of MSS of all the districts will start as soon as possible.The MSSs of 10, 11 and 12 districts would be completed during the first, second and third

phase of the project respectively. The expenditure would be incurred on TA/DA, stationery,hiring of vehicles and other operational costs. The provision for this activity will be made torespective ATMAs.

6. The SREP and MSS documents will act as a template for setting a direction towards market-ledextension and agricultural productivity enhancing activities in the district. Further, these will

facilitate resource allocation across programme areas. The MSS and SREPs, therefore, wouldbecome the basic documents for the development of work plans at village, block and district

level. The objective is not to duplicate what is already being supported under the centrallysponsored ATMA (extension reforms) and other schemes, but to fill critical gaps in the on-

going schemes with special focus on market-led extension. This will help in making efficientuse of the public funds provided by the GOI and GOM, including Support to State Extension

Programme for Extension Reforms, National Agricultural Development Plan and NationalFood Security Mission.

7. The Block Technology Team (BTT) members of the project areas would identify the activitiesof SREPs and MSSs which are relevant to their Taluka. These will act as guiding principle foridentifying activities for preparing the Block Action Plans which will be combined to prepareDistrict Annual Action Plan. The BTT and FIAC members shall take following issues intoconsideration for preparing the Block Action Plan:

Extension activities identified in SREPs and MSSs Group demand as identified by FIAC members

Ongoing scheme activities for dovetailing with MACP activities

Success stories identified for replication

8. The SREP and MSS of each district would give description of the strategy to be followed forimproving competitiveness of agriculture in a particular district. The specific activities coming

from SREP and MSS would vary from district to district. Although the SREPs for all thedistricts have been prepared, the MSSs will be prepared after the project becomes effective. The

execution of extension programme would naturally differ from district to district as it has totake into account the needs and priorities of the local communities as reflected in the SREP and

MSS.

B) Training:

9. All trainings for line department staff and farmers will be specifically targeted at the catchmentareas of the APMCs, Rural Haats, FCSCs and other markets and marketing channels being setup under Component B of the project. The various trainings like training of officers, training offield extension functionaries and training of farmers would be undertaken in catchment area ofthe activities under Component B. Similarly the other programs of market led extension andcapacity building like crop demonstration with field days, demonstrations on organic farming,demonstration on post harvest management technology, demonstration of fodder production,demonstration cum production units for goat as a high value enterprise would be implemented

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in the catchment areas of the programs under Component B. For this purpose ATMA shallprepare the yearly plan for the district showing interface between the beneficiaries falling in the

catchment area of programs of Component B and the programs of capacity building proposedunder Component A. The farmers falling in the area of Component B activities like APMCs,Rural Haats, Live Stock Markets, FCSCs (Grain, Horticulture) will be identified which could beindividual farmers / PGs / PAs. For capacity building, training programs, the same farmers, PGs/ PAs will be involved in the programs of demonstrations, exposure visits depending on the

locations of the farmers falling in a particular project intervention area.

a) Training of Line Department Staff:

10. Training of officers: The training of officers is important as they have to act as resource personsto impart training to the field extension functionaries who are directly in contact with thefarmers. The officers will need to be trained not only in productivity and quality improvement

but also in different aspects of marketing and post-harvest management. The training shouldenable the officers to impart marketing related skills to the field extension functionaries and

farmers. The training would also cover the project activities envisaged under Component B sothat the officers are well equipped to implement their respective departments activities

effectively. Orientation workshops will be organized to familiarize the line department fieldstaff wit