PUBLIC SECTOR SUPPORT FOR INCLUSIVE AGRIBUSINESS DEVELOPMENT · Public sector support for inclusive agribusiness development ... DOF Department of ... 3. public sector support for

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PUBLIC SECTOR SUPPORTFOR INCLUSIVE AGRIBUSINESSDEVELOPMENT

An appraisal of institutionalmodels in Bangladesh

FOOD AND AGRICULTURE ORGANIZATION OF THE UNITED NATIONSRome, 2014

PUBLIC SECTOR SUPPORTFOR INCLUSIVE AGRIBUSINESSDEVELOPMENT

An appraisal of institutionalmodels in Bangladesh

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Zahurul Karim

Edited by Eva Gálvez-Nogales and Marlo Rankin

The designations employed and the presentation of material in this informationproduct do not imply the expression of any opinion whatsoever on the part of theFood and Agriculture Organization of the United Nations (FAO) concerning the legalor development status of any country, territory, city or area or of its authorities, orconcerning the delimitation of its frontiers or boundaries. The mention of specificcompanies or products of manufacturers, whether or not these have been patented,does not imply that these have been endorsed or recommended by FAO in preferenceto others of a similar nature that are not mentioned.The views expressed in this information product are those of the author(s) and do notnecessarily reflect the views or policies of FAO.

E-ISBN 978-92-5-108185-3 (PDF)

© FAO, 2014

FAO encourages the use, reproduction and dissemination of material in this informationproduct. Except where otherwise indicated, material may be copied, downloaded andprinted for private study, research and teaching purposes, or for use in non-commercialproducts or services, provided that appropriate acknowledgement of FAO as the sourceand copyright holder is given and that FAO’s endorsement of users’ views, products orservices is not implied in any way.All requests for translation and adaptation rights, and for resale and other commercialuse rights should be made via www.fao.org/contact-us/licence-request or addressed [email protected] information products are available on the FAO website (www.fao.org/publications)and can be purchased through [email protected].

RECOMMENDED CITATIONFAO. 2014. Public sector support for inclusive agribusiness development – An appraisal of institutional models in Bangladesh. Country case studies – Asia. Rome.

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www.fao.org/ag/ags | [email protected]

RURAL INFRASTRUCTURE ANDAGRO-INDUSTRIES DIVISION

iii

Contents

Preface vAcronyms viAcknowledgements viiExecutive summary viii

CHAPTER 1 Introduction 1

1.1. Background 11.2. Purpose 11.3. Methodology 11.4. Organization 2

CHAPTER 2 Institutional profile 3

2.1 Drivers behind the creation of DAM 32.2 Institutional profile 52.3 Institutional environment 62.4 Institutional capacity 7

CHAPTER 3 Appraisal of the business model for service provision 11

3.1 Services of DAM 113.2. Main instruments 133.3 Existing capacities 133.4 Performance of DAM 153.5 Institutional comparative advantages 17

CHAPTER 4 Capacity development priorities 19

4.1 Development path 194.2 Priority areas for capacity building 194.3 Potential roles and instruments for FAO support 21

CHAPTER 5 Key findings 23

ANNEx 1 People interviewed 25

ANNEx 2 Current organogram of DAM 27

ANNEx 3 Proposed organogram of DAMA 29

iv

FIGURES1. DAM’s organizational structure within the Ministry of Agriculture 3

TABLES1. Annual expenditures of DAM (US$) 82. Summary of DAM services 113. Services demanded by clients and provided by DAM and related agencies 134. Programmes, service areas and instruments used by DAM 145. Service areas and capacity analysis of DAM 156. SWOT analysis of DAM 16

v

Preface

The agrifood system is changing rapidly. Structural changes are occurring throughout the system in response to the modernization of agriculture (globalization, coordination and concentration) and shifting consumer and societal demands for safer, better-quality and ready-to-eat food produced in a socially and environmentally responsible manner. This new scenario coexists with more traditional types of family and subsistence farming.

This changing environment places increased pressure on Ministries of Agriculture (MOAs) in devel-oping countries to engage in agribusiness and agro-industry development. However, to what extent are the MOAs empowered and equipped to do so? Many of them have seen their mandates and functions expanded from a strictly productive dimension to a more holistic, farm-to-fork approach. This expan-sion should be reflected in the provision of an increased scope of public goods and services to deal with post-production issues. MOAs also face the challenge of mainstreaming relatively new approaches such as the design and implementation of value chain programmes; climate-smart agriculture; the use of con-tract farming; public–private partnerships and other private sector engagement models; and agribusiness programmes with a territorial dimension (e.g., agricultural growth corridors and clusters).

FAO has conducted an appraisal of the organizational arrangements used by MOAs to support inclusive agribusiness and agro-industry development, which included a scoping survey of 71 countries and in-depth analysis of 21 case studies from Africa, Asia and Latin America. The study found that many MOAs have established specific agribusiness units with technical, policy and/or coordination functions concerning agribusiness development. Others have set up clusters of units with complementary individual mandates.

The study analysed how well prepared these agribusiness units and their staff are to deal with both traditional and non-traditional approaches and tools for agribusiness development. This assessment examined the units’ staffing, organizational structure and budget allocation, and the range and quality of goods and services they provide.

FAO is publishing this series of country case studies to enhance knowledge and information on best practices for establishing and operating well-performing agribusiness units. The various organizational models applied by countries to cater to the changing agribusiness environment are also explored, includ-ing mechanisms to build linkages with other relevant ministries (e.g., of industry and commerce) and private institutions. The series provides an opportunity to raise awareness about the need for stronger public commitment to inclusive agribusiness and agro-industrial growth, reflected in a more generous allocation of human and financial resources to empower agribusiness units and similar structures within MOAs. Refocusing the core functions and/or targeting specific commodity/value chains could also help the units to achieve a suitable balance between the requirements of their changing agribusiness mandates and their existing resource allocations, while maximizing the achievement of social goals (e.g., inclusive-ness and job creation).

vi

Acronyms

ADB Asian Development BankBADP Bangladesh Agribusiness Development ProjectBARC Bangladesh Agricultural Research CouncilBARI Bangladesh Agricultural Research InstituteBFRI Bangladesh Fisheries Research InstituteBSCIC Bangladesh Small and Cottage Industries CorporationBSTI Bangladesh Standards and Testing InstituteDAE Department of Agricultural ExtensionDAM Department of Agricultural MarketingDAMA Department of Agricultural Marketing and AgribusinessDLS Department of Livestock Services DOF Department of FisheriesEPB Export Promotion BureauFMG Farmers’ Marketing GroupGAP good agricultural practiceIQHDP Integrated Quality Horticulture Development Project MOA Ministry of AgricultureMSMEs micro-, small and medium enterprisesNAP National Agriculture PolicyNARS National Agricultural Research SystemNATP National Agricultural Technology ProjectNCDP Northwest Crop Diversification ProjectNGO non-governmental organizationPPP private–public partnershipR&D research and developmentRD&E research, development and extensionSMEs small and medium enterprisesSPS sanitary and phytosanitary standardsSWOT strengths, weaknesses, opportunities and threats (analysis)WTO World Trade Organization

vii

Acknowledgements

The author of this study is Dr Zahurul Karim, who worked under the supervision of Mr Virgilio Cab-ezon and Dr Bessie Burgos of the Southeast Asian Regional Center for Graduate Study and Research in Agriculture (SEARCA). Marlo Rankin and Eva Gálvez of FAO provided overall supervision to this and another five studies conducted in Southeast Asia as part of a global study carried out in Asia, Africa and Latin America.

The author wishes to thank the key informants of the study who shared their knowledge and experi-ences during the study period. Special thanks for valuable assistance are due to Prof. S.M. Fakhrul Islam of Banghabandhu Shiekh Mujubur Rahman Agricultural University, Salna, Gazipur; Dr Saleh Ahmed, Post-Harvest and Quality Assurance Expert, National Agricultural Technology Project (NATP), Hortex Foundation, Dhaka; and Mr Mia Abdur Rashid, Horticultural Crop Production and Processing Special-ist and Program Director, Centre for Agriresearch and Sustainable Environment and Entrepreneurship Development.

The author also extends thanks to the officials of the Department of Agricultural Marketing (DAM), the Ministry of Agriculture, and the Agribusiness Development Project of DAM, who provided valuable input for the study.

Finally, sincere appreciation goes to Larissa D’Aquilio for production coordination, Jane Shaw for copy editing, Francesca Cabré-Aguilar for proof-reading and Monica Umena for the layout.

viii

Executive summary

This document presents a case study of Bangladesh’s experience in establishing an agribusiness department within the Ministry of Agriculture (MOA). The objectives of the study are to describe the institutional profile of the Department of Agricultural Marketing (DAM); characterize DAM’s institutional activities, functional roles, main objectives, current priorities, and scope of services pertaining to agribusiness and agro-industries; suggest capacity building for the department; and identify potential options for sup-port from FAO. The methodology involved desk review of sources such as reports, journals and book documents. Key informant interviews guided by a questionnaire were administered, and a stakeholders’ workshop was held to validate the study findings. Supplementary information gathered at the workshop was cross-verified against secondary sources.

Since its inception in 1983, DAM has provided marketing services to ensure fair returns on their pro-duce for producers, and adequate supplies at reasonable prices for consumers. Resource limitations make it impossible to establish a price stabilization programme to prevent undue price rises for consumers and depressed prices for producers. The MOA and other agencies are not well equipped and do not have the capacity to regulate, guide and support agribusiness and agro-industrial development. Because of its financial limitations, shortage of skilled staff and lack of a monitoring and evaluation system, DAM is provides services on the marketing of agricultural produce, with very little support to agribusiness devel-opment. Currently, its major services focus on improving the marketing environment, with very limited support to collective action and alliance building using its own funds. Services related to strengthening market linkages are inadequate and irregular, and activities for appraising agro-enterprises are very weak. Owing to a shortage of skilled personnel, and insufficient funds, DAM has not made visible progress in market promotion.

Several donors and development partners support DAM because it is the only public agency deliver-ing services for agricultural marketing and agribusiness promotion. The importance of agribusiness initiatives is emphasized in the National Agriculture Policy, which aims to facilitate and support the development of market infrastructure and effective value chains between producers and consumers, and has proposals for reorganizing and strengthening DAM and establishing an Agriculture Price Commis-sion. In 2009, the Government of Bangladesh constituted a 12-member Expert Committee to review the activities of DAM, analyse its performance and recommend steps for its restructuring. The committee has suggested reorganizing and restructuring DAM as the Department of Agricultural Marketing and Agribusiness (DAMA). These recommendations are waiting for government approval.

Despite its constraints, DAM has comparative advantages in integrating activities to improve mar-ket management and agribusiness development. If transformed into DAMA and given the necessary responsibilities and authority, it could prove an appropriate institution for promoting agribusiness development in Bangladesh. It will be necessary to enhance DAM’s capacity in agribusiness policy formulation, market access and development, market and product promotion, market information and intelligence, farmer–market linkages, management of sanitary and phytosanitary standards, institutional linkages, and industrial linkages and support for it to tackle pressing current and future challenges in agribusiness development.

1

1.1. BackgroundThe new agribusiness era is characterized by a shift from family farms to strategically placed commercial production and processing units linked to exporters and modern retailers. New sophisticated and globalized procurement prac-tices have been mainstreamed to comply with food quality and safety standards, including traceability requirements, and to reduce transaction costs and minimize risks. Changing consumer preferences and concerns about the impacts of climate change are also pushing the agribusiness sector to new heights of performance and innovation.

This changing agribusiness environment is putting increasing pressure on ministries of agri-culture (MOAs) to engage in agribusiness and agro-industry development. Some MOAs have established specific agribusiness units; others have updated the mandate of existing departments or bureaux dealing with agribusiness aspects and/or have added new substructures to deal with topical issues such as the promotion of value chains and agribusiness private–public partnerships.

Bangladesh is predominantly an agricultural country with a population of about 159 million people. The agriculture sector employs 52 percent of the labour force and contributes about 21 percent of gross domestic product. Enhancement of the rural economy, with the prime objective of improving food security and nutrition sta-tus, depends on agricultural production through sustainable land, water and forest management practices. The agriculture sector in Bangladesh has undergone major structural changes over recent decades. Despite the many constraints, the sector continues to evolve in response to natu-ral calamities, socio-political change, accelerating population growth, urbanization, new agricultural technologies, and new opportunities in the rural non-farm sector arising from policy reforms, especially those bringing changes in markets and trade liberalization.

The changing agribusiness environment exerts heavy pressure on the ministries concerned to deliver services for development of this sector. Recently, the MOA has established a permanent

unit – the Agribusiness Cell – which is headed by an Additional Secretary and is responsible for developing agribusiness policy/regulations, guid-ing agribusiness operations and liaising with other ministries and development partners. However, the unit has faced challenges in delivering on its mandate, as its authority is limited to that of a liaison office, although it is a permanent unit.

1.2. PurPoseThis study documents Bangladesh’s experience of providing services to promote agribusiness and agro-industries. The Department of Agricultural Marketing (DAM) is the government’s core agency for marketing and agribusiness development. This study reviews the business model used by DAM and proposes options for capacity development to promote agribusiness in Bangladesh.

The study has three main objectives: i) to describe DAM’s institutional profile for assuming new functions related to agribusiness and agro-industrial promotion; ii) to characterize DAM’s institutional activities and describe its functional roles, key objectives, current priorities, and scope of services pertaining to agribusiness and agro-industries, including by assessing its capacities to fulfil its functions and identifying its strengths, weaknesses, opportunities and threats, and its institutional comparative advantages for deliver-ing services; and iii) to suggest capacity building activities for DAM and potential options for sup-port from FAO.

1.3. MethodologyThe study methodology involved desk review of sources that included reports, journals and book documents. Key informant interviews guided by a questionnaire were administered, and a stake-holders’ workshop was held to validate the study findings. Supplementary information gathered at the workshop was cross-verified against second-ary sources. A list of the people interviewed is presented in Annex 1.

Chapter 1

Introduction

2 Public sector support for inclusive agribusiness development – An appraisal of institutional models in Bangladesh

1.4. organIzatIon The report has five sections. This first section presents background information on the pur-pose and methodology of the study. The second section describes DAM’s institutional profile for providing services that promote market-ing and agribusiness development. The third section describes DAM’s business model for service provision and assesses the scope of ser-vices against a predetermined set of 11 agribusi-ness service areas: appraisal of business models; value chain analysis, including benchmarking and chain coordination/facilitation; building of

business and entrepreneurial skills; reinforce-ment of business and market linkages; support to collective action and alliance building; finance and investment appraisal and support; trade and marketing appraisal and support; agro-industry and processing appraisal and support; develop-ment of policy and strategy papers; lobbying and advocacy in the agribusiness sector; and sharing of knowledge and information pertaining to the agribusiness sector. The fourth section identifies priority areas for capacity building and areas where FAO could provide support. The last sec-tion presents the main findings.

3

2.1 Drivers behinD the creation of DaM

DAM was created in 1928 during the era of United Kingdom colonial rule and on the recommenda-tion of the Royal Commission on Agriculture. In 1943, the Government of Bengal, realizing agricul-ture’s importance and potential, made DAM a per-manent body under the Agriculture and Industries Department. After independence in 1954, DAM was made part of the Agriculture, Cooperation and Relief Department of the Government of East Pakistan. In 1960, the Provincial Reorganization Committee approved an organizational structure

for DAM, with staff assigned to the divisional, district and subdivisional levels.

DAM’s current structure under the MOA (Fig-ure 1) was established in 1983, when it was given the objective of providing marketing services to ensure fair returns on their produce for growers, and adequate supplies at reasonable prices for con-sumers. Since then, DAM has focused on ensuring fair agroproduct prices for farmers and on market development activities. With its limited resources, however, DAM has been unable to establish a price stabilization programme to prevent undue price rises for consumers and depressed prices for producers.

Chapter 2

institutional profile

figure 1DaM’s organizational structure within the Ministry of agriculture

Ministry of Agriculture

Administration &Input Wing

Extension Wing

Research Wing

Seed Wing

Policy Planning andCoordination Wing

Planning Wing

Audit Wing

Department of Agricultural Extension (DAE)

Seed Certification Agency (SCA)

Cotton Development Board (CDB)

Bangladesh Applied Nutrition and HumanResource Development Board (BANHRDB)

Agriculture Information Service (AIS)

Department of Agricultural Marketing (DAM)

Bangladesh Agricultural DevelopmentCorporation (BADC)

Barind MultipurposeDevelopment Authority (BMDA)

Bangladesh AgriculturalResearch Council (BARC)

Bangladesh AgriculturalResearch Institute (BARI)

Bangladesh Rice Research Institute (BRRI)

Bangladesh JuteResearch Institute (BJRI)

Bangladesh Institute ofNuclear Agriculture (BINA)

Soil Resources Development Institute (SRDI)

Bangladesh Sugarcane Research Institute (BSRI)

Agribusiness Cell


In general, the Government of Bangladesh provides limited services for developing the agri-business environment. The Policy Planning and Coordination Wing of the MOA, which deals with policy monitoring and coordination with donors and international agencies, has two sec-tions: Foreign Assistance, and Policy Planning. Within this wing, the Agribusiness Cell (Figure 1) is responsible for developing agribusiness policy/regulations, guiding agribusiness operations and liaising with other ministries and development partners. The cell’s main task is promoting pri-vate–public partnerships (PPPs), which are a major driver of agribusiness and a support to the mandate of DAM. Responsibilities for the promotion of agribusiness are clearly defined among the other agencies that DAM considers its stakeholders. However, the Agribusiness Cell faces challenges in guiding agribusiness operations and liaising with other ministries because it lacks the necessary workforce and has limited authority. Recently, the Policy Planning and Coordination Wing submitted a proposal for expanding the Agribusiness Cell’s workforce, which is currently awaiting approval from the Ministry of Public Administration.

The wing also deals with the World Trade Organization (WTO), domestic and international trade and credit policy for agricultural products. It monitors implementation of agricultural leg-islation and policies and maintains data on food imports, stocks and prices. It also deals with food safety and nutrition issues.

The MOA and other agencies are not well equipped and do not have the capacity to regulate, guide and support agribusiness and agro-industri-al development. Several donors and development partners support DAM as the government agency for delivering agricultural marketing and agribusi-ness promotion services. At present, DAM’s ser-vices are mainly for the marketing of agricultural produce, with very few specific services related to agribusiness development under the umbrella of the MOA.

DAM’s current organizational structure, as shown in Annex 2, is based on six offices, whose functions are as follows:

a. Administration and Accounts: �� Acting as administrative head with respon-

sibility for overall administration of DAM.�� Advising the MoA on technical matters and

formulating policies concerning DAM.�� Acting as DAM’s principal accounting

office for budget provision.

�� Administering and implementing the functions of DAM as stipulated in acts, ordinances, rules, regulations and direc-tives issued by the government from time to time.�� Ensuring the proper functioning and disci-

pline of DAM.�� Providing executive and operational guid-

ance to field staff, and supervising them.�� Controlling and supervising DAM’s work

and inspecting its offices. �� Ensuring collection of licence fees from

market functionaries at notified markets under the Agricultural Produce Markets Regulation Act (1964), rents, etc.�� Preparing and implementing projects and

programmes for the improvement of mar-keting conditions for agricultural and ani-mal products.

b. Research and Development (R&D):�� Conducting surveys and research on the

marketing of farm products, and preparing reports.�� Preparing and implementing development

projects and programmes.�� Conducting studies of production costs

and price spreads.

c. Planning and Development Cell: �� Preparing, implementing and evaluating

development projects.�� Setting annual development targets, pre-

paring progress reports and monitoring activities.�� Facilitating the movement of farm prod-

ucts from concentrated production areas to Dhaka city.�� Liaising with transport agencies for the

movement of products.�� Supervising the construction and manage-

ment of DAM’s wholesale markets.

d. Regulation, Extension, Training and Coordination: �� Organizing, supervising, guiding and eval-

uating the work at demonstrations of hide and skin flaying and curing, egg grading and sheep shearing.�� Organizing training for flayers and hide

and skin merchants on proper flaying, cur-ing and preservation of hides and skins, in collaboration with local authorities, the Bangladesh Small and Cottage Industries

Chapter 2 – Institutional profile 5

Corporation (BSCIC) and the Export Pro-motion Bureau.�� Developing and introducing grade specifi-

cations for hides and skins.1

�� Organizing education programmes on the proper flaying, curing and preservation of hides and skins during Eid-ul-Azha, for television, radio and the press.�� Supervising enforcement of the Agricul-

tural Produce Markets Regulation Act, and monitoring the collection of licence and renewal fees under the act.�� Organizing in-service training of DAM

personnel, and meetings, seminars and conferences.

e. Market Intelligence and Statistics: �� Preparing daily and weekly price bulletins.�� Preparing weekly and monthly price

reports/reviews.�� Supplying price information to the army,

jails, hospitals, the police, banks, customs and other government and semi-govern-ment agencies.�� Supervising the compilation of monthly

figures on the movements of farm products in and out of Bangladesh’s main markets.�� Preparing weekly reviews of the prices

and supply positions of important farm products in Dhaka market, for broadcast through Radio Bangladesh.�� Scrutinizing the price and supply data

received from 70 markets, for the compila-tion of weekly price bulletins and monthly reports.

f. Divisional Offices:�� Studying the marketing, storage and trans-

portation problems for farm products in the division and suggesting measures/organizing programmes for their solution.�� Implementing development schemes with-

in the division.�� Guiding, supervising and coordinating the

work of field officers and staff.�� Coordinating DAM’s work with other

government offices at the divisional and district levels.

1 Standards for other products have not yet been deter-mined by the government. Once such standards have been set, DAM will organize sections to handle activities related to them.

�� Issuing licences to market functionaries under the Agricultural Produce Markets Regulation Act, monitoring enforcement of the act and collecting license and renewal fees under the act.

DAM has four divisional offices, 21 district offices and 68 subdivisional offices. The Secretariat com-prises five units, while divisional, district and subdivisional offices carry out staff functions and implement activities. Under its current structure, DAM has – in principle – the necessary mecha-nisms to implement agribusiness plans, policies, programmes and projects. It performs both staff and line functions.2

2.2 institutional profileMissionThe mission of DAM is to serve as a focal unit for market development services, market linkages and information exchange for better and more efficient marketing of agricultural produce, and to support agribusiness promotion.

DAM is mandated to collaborate with and pro-vide direct assistance to the private sector – includ-ing non-governmental organizations (NGOs) and producer organizations – in marketing ventures and market analysis, identification and matching. Its specific responsibilities are to:

� collect market information at the farmer level and on wholesale and retail prices, market arrivals and farm product movements and stocks; and disseminate price information to farmers, traders and consumers through radio, the press and news bulletins;

� monitor prices, identify the causes of price fluctuations and suggest corrective measures;

� organize movements of farm products, especially perishable items, from glut to deficit areas/consuming centres, in cooperation with trade and transport agencies;

� organize the movement and sale of produce from farmers in new production areas;

� enforce the Agricultural Produce Markets Regulation Act of 1964 (amended 1985);

� conduct studies and research on the marketing of farm products, assess marketing costs and traders’ margins, identify marketing

2 DAM’s staff function gives it an important role in policy formulation/implementation, while its line func-tion authorizes it to implement development projects directly through its district and subdistrict offices.


problems and problem areas, and suggest measures for improving marketing conditions and reducing marketing costs;

� construct wholesale markets with adequate facilities in important distribution/consuming centres, and introduce improved market practices;

� provide extension services to improve the flaying, curing and preservation practices for hides and skins, to maximize foreign exchange earnings;

� advise the government on production targets for different crops, procurement programmes and support prices for important crops, and policies on pricing, marketing and storage.

A closer look at these mandates reveals that three of them are specifically related to agribusi-ness: i) conducting studies/research on marketing, which contributes to improved market condi-tions and reduced marketing costs (supply chain); ii) constructing wholesale markets with adequate facilities, which is related to the provision of public infrastructure; and iii) advising the govern-ment on policies related to pricing, marketing and storage (post-harvest), which transcends the broad area of policy regulation.

functions of DaMDAM’s functions are to:

� regulate the 717 notified markets announced by the government (under subsection 1 of the Agricultural Produce Markets Regulation Act) – the only markets over which government organizations have legislative control;

� issue, renew or cancel the licences of operators in these notified markets;

� fix the market charges payable by purchasers or sellers to market functionaries in connection with the purchase or sale of agricultural produce in the notified markets;

� maintain standard weights and measures; � settle disputes between purchasers and sellers during the marketing of agricultural produce;

� implement development projects to assist agricultural produce marketing and agricultural market development;

� provide secretariat support to district market advisory committees;

� collect and disseminate agricultural market information;

� set penalties for contraventions of the act’s provisions.

Based on DAM’s functions in implementing devel-opment projects to assist agricultural produce marketing and agricultural market development, major development partners – including FAO, the World Bank, the Asian Development Bank (ADB), the Japanese International Cooperation Agency and the Canadian International Develop-ment Agency – have designated DAM the overall implementing unit for market and agribusiness-related projects in Bangladesh, and the govern-ment has concurred with this view.

However, an agribusiness role is not specifi-cally mentioned in the act that established DAM in 1983, which envisioned the department as a marketing arm whose main task was to ensure “fair returns to producers and affordable prices and adequate supply for consumers”. The consen-sus between the Government of Bangladesh and development partners that DAM is the govern-ment-assigned agency for agribusiness promotion could therefore be perceived as an interim strategy in the absence of an enabling legal framework.

In 2009, the MOA constituted a 12-member Expert Committee to review DAM’s activities, analyse its performance and make recommenda-tions for its restructuring. The committee was also asked to suggest amendments to existing laws, rules, regulations and by-laws to strength-en DAM’s activities. It suggested renaming the organization as the Department of Agricultur-al Marketing and Agribusiness (DAMA), and establishing a new structure, shown in Annex 3. Pending government approval of the commit-tee’s recommendations, DAM remains the public agency authorized to deliver services for agribusi-ness promotion and the marketing of agrocom-modities, because of its flexible and convenient structure. DAMA will not be operational until it has received government approval.

2.3 institutional environMent policy and socio-economic environmentThe importance of agribusiness initiatives is emphasized in the National Agriculture Policy (NAP) 20103, the government’s main strategic document in setting priorities for development of the agriculture sector. The main agribusiness theme in the NAP is “agribusiness initiatives by farmers, traders, and entrepreneurs will be facili-tated and necessary support and incentive will be

3 http://www.moa.gov.bd/policy/Draft%20Agri_Policy_English.pdf


provided as and when deemed necessary”. Sup-port for market infrastructure development will be through government efforts to “develop effec-tive value chain between producers and consum-ers”. In research, special attention will be given to “post-production technologies, high value crops, value addition, and agribusiness and management and trade”.

Clearly, the Government of Bangladesh has a forward-looking perspective that puts a premium on the development of agribusiness initiatives. NAP 2010 includes proposals for reorganizing and strengthening DAM and establishing an Agri-culture Price Commission, and identifies impor-tant programmes in support of agribusiness and the agriculture sector in general.

agribusiness stakeholdersDAM’s main clients are farmers, traders, business development service providers to both public and private organizations, and NGOs. To farmers and traders, DAM provides mainly market price infor-mation services; to the other groups, it imparts training on marketing and agribusiness. The train-ing focuses on the principles of marketing agricul-tural products, farmer–market linkages, market information, group marketing, and sanitary and phytosanitary (SPS) issues. Other public and private sector organizations providing research and development services with actual or potential involvement in agribusiness are described in the following paragraphs.

Extension services: Public agencies provide farmers with need-based services to optimize resource use and increase productivity through high-yielding varieties, improved management practices, strengthened marketing systems for agrocommodities, and links to traders that pro-mote sustainable agricultural and socio-economic development. These agencies are the Department of Agricultural Extension (DAE), Agricultural Information Services, the Seed Certification Agen-cy, the Cotton Development Board, the Bang-ladesh Applied Nutrition and Human Resource Development Board, the Department of Environ-ment, the Department of Fisheries (DOF), the Department of Livestock Services (DLS), the Local Government Engineering Department, and the Bangladesh Fisheries Development Corpo-ration. The Horticulture Export Development (Hortex) Foundation was established in 1993 under the Companies Act of 1913 as a non-profit organization for the development, promotion and

marketing of exportable horticultural produce, particularly high-value, non-traditional crops for high-price, non-conventional markets. Its goal is to boost the national economy and farmers’ incomes by providing technological and advisory support for developing and promoting agribusi-ness in high-value agroproducts for export. The Hortex Foundation is led by a governing body and has seven members: two from the public sector and five from private sector organizations, including one NGO.

Input services: The Bangladesh Agricultural Development Corporation is an autonomous institution that provides input delivery services for increasing the productivity of crops. These services include seeds and the monitoring of small irrigation systems.

Research services: The research institutes in the National Agricultural Research System (NARS) are responsible for conducting research that gen-erates demand-driven technologies to increase productivity in a sustainable manner for transfer to users by extension agencies. It is under the lead-ership of the Bangladesh Agricultural Research Council (BARC). The institutes of NARS are the Bangladesh Agricultural Research Institute (BARI), the Bangladesh Rice Research Institute, the Bangladesh Jute Research Institute, the Soil Resource Development Institute, the Bangladesh Sugarcane Research Institute and the Bangladesh Institute of Nuclear Agriculture.

2.4 institutional capacityfinancial resourcesThe annual expenditures of DAM for the five years from 2007/2008 to 2011/2012 is presented in Table 1. Overall, DAM’s budget was very small and has declined in both absolute and relative value, from US$7.82 million in 2007/2008 to about US$2.47million in 2011/2012. Its share relative to the total MOA budget was a meagre 1 percent in 2007/2008, and was even lower in 2010/2011 and 2011/2012. This dwindling pattern is largely explained by the continuous reduction of the government’s development budget.4 The

4 The development budget is to support projects. The government is now expanding its revenue budget (non-development) so that it too covers project costs. There-fore, as the revenue budget expands, the development budget is gradually declining.


government’s explanation for this is that as it is expanding its revenue budget, significant portions of project support costs should now be funded by local resources. This policy may appear strange from both fiscal and monetary standpoints, but the declining share of development budget may be because the government is unable to provide the necessary counterpart funds. Given this situation, DAM should explore ways of expanding its devel-opment loan portfolio to fund its activities, but it is currently constrained by its limited capacity in preparing development proposals.

DAM faces financial constraints. The funds it receives from the annual development bud-get cover only staff salaries and some overhead items. Although donor support for projects can indirectly augment DAM’s resources through capital expenditures for vehicles, offices and other services that improve mobility, these resources are time-bound.

However, DAM can leverage its use of these project funds to support agribusiness activities that it would otherwise not have the budget to implement.

human resourcesA series of reorganizations by the government (none of which have yet been finalized) has left DAM with about 77 vacant positions. The breakdown of the 475 total sanctioned posts is presented in Annex 2.

The current structure of DAM dates back to 1982 and includes redundant positions at the district level, such as for flayers, sheep shearers, graders, egg testers and butchers. Although these positions still appear on the organizational struc-ture, DAM’s duties have been reduced to mar-ket information collection and market regulation activities under the Agricultural Produce Markets

Regulation Act of 1964 (amended 1985).5 Its market regulation activities are now market levy collection, trader registration, and monitoring of weights and measures, only the first two of which are currently carried out.

DAM is managed by a Director under the supervision of the MOA and follows a top-down, authoritarian management model. The lack of del-egation of authority slows planning and decision-making processes, lowers productivity and leads to governance problems. The processes for obtaining approval for delivering services need to be simpli-fied. In addition, although DAM is authorized to make any necessary internal structural changes, obtaining the approval for such changes is also slow, highly bureaucratic and centralized.

DAM is supposed to be involved in price monitoring, agricultural market research and policy formulation, the operation of wholesale markets at the district level, and the marketing of agricultural commodities (transportation and logistics). However, it is understaffed and under-resourced, so unable to perform these tasks to any substantial degree.

The R&D Unit has only 33 staff members. DAM’s weekly price bulletins are often four to six weeks late because of data entry and analysis

5 This act regulates the operation of markets rather than their management. The government does not promote a self-governing management system or provide guide-lines for improving operations and adhering to operating standards and food safety and quality control mecha-nisms; market participants have no role in market man-agement. In addition, the act is not properly enforced: the government is more interested in collecting revenues than in using the market to promote economic growth and services; lessees are interested only in collecting marketing charges, and the revenues collected are rarely returned to the market for infrastructure development.

TABLe 1annual expenditures of DaM (us$)

year non-development Development total DaM* total Moa**

2007/2008 781 000 7 051 000 7 832 000 763 418 000

2008/2009 865 000 10 955 000 11 820 000 9 561 351 000

2009/2010 985 000 10 993 000 11 979 000 837 935 000

2010/2011 1 332 000 2 806 000 4 138 000 937 661 000

2011/2012 1 378 000 1 093 000 2 472 000 809 610 000

US$1 = BDT 80.00* Sources: DAM.** Source: Ministry of Finance.


constraints. It also gathers information on produc-tion and marketing costs, which it provides to other government departments on request. At the district level, the District Marketing Officer has primary responsibility for monitoring prices and supplies of specific commodities (such as rice), organizing marketing and transportation logistics, providing advisory services for commodity pro-curement by local authorities, and enforcing the Agricultural Produce Markets Regulation Act.

The officers and staff of all DAM divisions are recruited on a competitive basis, but do not receive the necessary in-service training to develop their knowledge and skills and deliver the services effectively.

DAM does not have its own monitoring and evaluation system. It monitors specific aspects such as prices in selected markets and of spe-cific commodities, and performs monitoring tasks assigned by the MOA, but these activities are not systematic and are limited to inspections. DAM also lacks a monitoring system for assessing cli-ent satisfaction. Respondents in key informant interviews stated that there is an urgent need to establish a system for effective monitoring and evaluation of DAM’s activities.

DAM relies on the MOA for its budget, per-sonnel, operations and audit. As in most govern-ment agencies in Bangladesh, there is urgent need for rationalization to address current inadequa-cies. This work has been in progress for several

decades, affecting operations. Delayed reimburse-ment of staff expenses is a problem that could derail operations; staff are often left to pay their own travel expenses.

strategic leadership and governanceThe Director of DAM supervises its day-to-day activities; the MOA has the final authority over decision-making on major policy issues. The Director delivers services under the direct control and supervision of the MOA’s Deputy Director for Policy and Planning and manages DAM in collaboration with other officials and staff of the department.

interinstitutional linkagesDAM maintains linkages with several organizations working on agriculture and rural development. The most relevant of these in terms of delivering services are NARS institutes for technologies and management practices; extension agencies – DAE, DOF and DLS – for information to growers; the Export Promotion Bureau (EPB) for export devel-opment; the Hortex Foundation for specialized service in production and export value chain devel-opment; the Small and Medium Enterprise (SME) Foundation for access to financial resources; the Bangladesh Standards and Testing Institute (BSTI) for quality control and certification of products; and the Bangladesh Trade Facilitation Institute for promoting business.

11

3.1 ServiceS of DAMDAM provides services for market research and extension, market information and intelligence, market regulation and facilitation, and agribusiness promotion. Most services lean towards improve-ment of the marketing environment. Although these services serve agribusiness in general, new dimensions of agribusiness are generally promoted through the implementation of development pro-jects, largely funded by development partners, as shown in Table 2. Of the 11 service areas examined in this study, five are core services of DAM, two of which are supported by the ADB-funded Bangla-desh Agribusiness Development Project (BADP). It should be noted that DAM’s involvement in this project arose from the consensus view of develop-

Chapter 3

Appraisal of the business model for service provision

ment partners and the government that DAM is the appropriate unit to assume new functions in agribusiness promotion.

Reinforcement of business and market linkages: DAM provides services for strengthening direct market linkages between producers and buyers (traders, exporters, consumers and others) to ensure fair and profitable prices for producers and the availability of affordable supplies for buyers. However, this service is inadequate and irregular.

DAM makes only limited use of internal link-ages for promoting agricultural technology trans-fer and market research, developing infrastructure and creating a policy environment conducive to marketing and agribusiness promotion. Measures

TABLE 2Summary of DAM services

Service area Services offered core Secondary

1. Appraisal of business models Started through implementation of BADP x

2. Value chain analysis Services for all agrocommodities through BADP

x

3. Building of business and entrepreneurial skills Training on management of agro-enterprises through BADP

x

4. Reinforcing business and market linkages Fairs and exhibitions in Bangladesh Consultations and fora with producers and buyers DAM Web site

x

5. Support to collective action and alliance building Participation in interministerial and South Asian Association for Regional Cooperation promotions

x

6. Finance and investment appraisal and support Not yet started x

7. Trade and marketing appraisal and support Not yet started x

8. Agro-industry and processing appraisal and support

Not yet started x

9. Development of policy and strategy papers Inputs to policy analysts and regulation formulators

x

10. Lobbying and advocacy in the agribusiness sector Stakeholder consultations (limited) x

11. Sharing of knowledge and information pertaining to the agribusiness sector

DAM Web site; promotional materials; consultations

x

Source: Study findings.


are needed to exploit opportunities at several levels: geographically, with fast-growing import markets; horizontally, by increasing the spread of export commodities; and vertically, by increasing the value added of export commodities.

The Hortex Foundation is addressing these issues on a limited scale and with little support from the Ministry of Commerce and the MOA through EPB. Steps to harmonize SPS measures and provide the groundwork for removing techni-cal barriers to trade are yet to be undertaken. The application of good agricultural practice (GAP), good veterinary practice, good hygienic practice and good manufacturing practice and the adop-tion of a quality assurance system are not being addressed in an organized manner, and there are no systematic plans for doing so.

Support to collective action and alliance building: DAM has very limited activities in supporting col-lective action and alliance building using its own funds. Such activities are largely pursued with the support of donor-funded projects, notably the Crop Diversification Project, the Northwest Crop Diversification Project (NCDP), the Agro-based Industries and Technology Development Project, the South Asia Enterprise Development Facility, BADP and the National Agricultural Technology Project (NATP). Through these initiatives, DAM has organized the Farmers’ Marketing Group (FMG) and developed an alternative supply chain outside the traditional marketing system. FMG was formed under NCDP, with representatives of small farmers’ groups, each with 20 members who unite for group marketing.

The aim of FMG is to assist its member groups in assuming responsibility for marketing their own produce. A total of 100 000 farmers/beneficiaries have been trained on production, post-harvest processing and marketing of high-value crops, and 160 000 farmers have received credit support. This has resulted in an additional 40 000 ha under high-value crops, producing 370 000 tonnes of agrocommodities.

Owing to its staffing and fund constraints, DAM has made little progress in market promo-tion domestically. It very occasionally holds a fair/exhibition, and rarely participates in exhibitions outside Bangladesh; EPB is mandated to attend such exhibitions, for exploring foreign markets.

Partnerships among DAM, the Hortex Foun-dation, EPB and other relevant organizations are important. Such partnerships require an extensive database of producers, processors and other infor-

mation related to agribusiness, but even collection of the necessary information is difficult to achieve because of insufficient logistics support.

Providing public marketing infrastructure: There are about 14 000 markets in Bangladesh, and most of those in rural or semi-urban areas are in poor condition with limited logistics, infrastructural, management and institutional facilities. Roads, especially the link and approach roads of rural markets, are not well maintained. Although the road transportation system has improved slightly in recent years, transport costs (and product losses) remain high, leading to increased product costs. In Rajshahi region, DAM has constructed 61 upazila (subdistrict) markets and 16 district wholesale markets for the marketing of perishable horticultural crops through NCDP.

Development of policy and strategy papers: DAM occasionally participates in the development of policy and strategy papers relating to marketing and agribusiness. It has an active role (as Mem-ber Secretary) in the MOA’s recently formed 12-member Expert Committee for reorganizing and restructuring DAM, and participates in efforts to formulate agriculture and rural development policy. To date, however, no brief or framework for agribusiness policy has been prepared.

Sharing of knowledge and information: DAM organizes seminars, workshops and expert con-sultations on agribusiness investment opportuni-ties for enhancing the capacities of the farming and fishery sectors. It also maintains Web-based information of investment opportunities in an integrated and cluster-based system.

However, does not have a demand-driven, organized market information system. Most mar-ket participants rely on their own information networks (of traders, wholesalers, commission agents, etc.), including the private sector. Many traders and progressive and wealthy farmers use mobile phones to collect market information, but small and medium farmers have no access to this information and are not even aware of its impor-tance. Market intelligence services are virtually non-existent in Bangladesh.

other servicesThe other services provided by DAM are summa-rized in Table 3. Farmers and fishers are the main clients assisted through the activities of BADP. Very little support is provided to micro-, small and

Chapter 3 – Appraisal of the business model for service provision 13

medium enterprises (MSMEs) and local govern-ment units or agencies, probably because these are not priorities for ongoing development projects.

Extending project resources to these clients, although important, would put additional pres-sure on the already scarce resources available for activities. Exploring additional funding sources and/or leveraging existing donor funds are options for increasing financial support for these impor-tant clients. However, DAM does not have the skills required for finding new funding sources.

3.2. MAin inStruMentSA summary of the main instruments and pro-grammes that DAM is currently implementing is given in Table 4.

3.3 exiSting cApAcitieSA summary of DAM’s capacities in its service areas is provided in Table 5.

Appraisal of business modelsActivities related to the appraisal of agro-enter-prises include formulating feasibility studies, conducting market studies and packaging invest-

ments. These activities generally depend on the support of development projects, and DAM’s capacity to increase them is stifled by its lack of capable staff and internal funds, especially counterpart funds for financing local services. The appraisal of business models may become a more significant function when DAM has undergone the proposed reorganization and has a legal basis for seeking additional funding through govern-ment appropriations.

value chain analysisValue chain analysis is not a core activity of DAM, but two projects currently being implemented address this crucial issue: BADP, through its agri-business value chain development component; and NATP. Eight staff members have acquired skills in value chain analysis, but they rarely use these skills because the activity is not part of DAM’s regular programme and lacks funding.

BADP activities related to business model appraisal and value chain analysis include identi-fication of locally produced high-value products, including their clusters, service needs and impor-tance; analysis of supply and value chains for

TABLE 3Services demanded by clients and provided by DAM and related agencies

clients (size, position in the value chain, etc.)

Services demanded capacity to meet client needs

Farmers and fishers (individual or in groups) engaged in primary production

Agricultural production technologies; post-harvest technologies; quality standards; market channel development

Provided by DAM through BADP

Micro-, small and medium agro-enterprises (individual or in groups) engaged in processing and marketing

Information on processing and related technologies, including labelling and packaging

Business registration and accreditation for tariff and duty rebates

Food safety regulations

Credit policies for preferential interest rates and charges

Policies on domestic transport to ease high shipping costs

Investment and financial analyses

Market linkages

Product promotion

Export procedures

Construction of market facilities

Very limited provision

Inadequate capacity

Inadequate capacity

Inadequate capacity

Inadequate capacity

Inadequate capacity

Very limited capacity

Inadequate capacity

Inadequate capacity

Inadequate capacity

Local government agencies Programme for agribusiness development including training on aspects of agribusiness to enable staff to provide extension services for agribusiness. This would cover all items demanded by MSMEs except food safety regulations and credit policies

Inadequate capacity



selected commodities and business enterprises; assessment of production bottlenecks, technology, and access to markets, inputs and finance; explo-ration of agribusiness associations’ potential to address constraints; recommendations on priority areas for interventions; and provision of appropri-ate business models.

Building of business and entrepreneurial skillsDAM has limited capacity to deliver services for in this area. Its staff lack the necessary knowledge and require training. About 20 staff members have received preliminary training on enterprise develop-ment, but need additional training, more exposure and greater in-depth knowledge before they can train other stakeholders in enterprise development.

reinforcement of business and market linkagesDAM’s activities in this area are limited to fairs, exhibitions and consultations. Staff require more in-depth knowledge of such issues as international and domestic market trends, trade restrictions under WTO, and phytosanitary, epizootic, and hazard analysis and critical control point requirements.

Support to collective action and alliance buildingDAM has developed significant experience and capacity at the domestic level in this area, through the MOA’s NCDP. However, widespread imple-mentation has been hampered by a shortage of staff, logistics support and budgetary arrange-ments for providing services and capacity building to stakeholders.

finance and investment appraisal and support The delivery of services in this area is a regular task for DAM. However, the department requires closer linkages with the Ministry of Industries’ SME Foundation, public and private banks and the Hortex Foundation.

trade and marketing appraisal and supportDAM has no activities in this area. The Ministry of Commerce’s EPB delivers such services for foreign trade and export markets.

TABLE 4programmes, service areas and instruments used by DAM

no. Service area programmes instruments

1. Appraisal of business models Regular task Financial and economic analysis tools

2. Value chain analysis Regular task/BADP Surveys, stakeholder consultations, key informant interviews

3. Building of business and entrepreneurial skills

Limited programme under development

Training, workshops, consultations, etc.

4. Reinforcement of business and market linkages

IQHDP, Majibnagar FMG, marketing groups, market investigations

5. Support to collective action and alliance building

IQHDP, Majibnagar FMG, marketing groups, market investigations

6. Finance and investment appraisal and support

Regular task/BADP Credit, training, etc.

7. Trade and marketing appraisal and support

Regular task/BADP Support services


Regular task/BADP Support services, training, advisory services

9. Development of policy and strategy papers

Regular task Participatory approach

10. Lobbying and advocacy in the agribusiness sector

As required Advocacy and facilitation services


Regular task, programme under development

Web-based information sharing platform

IQHDP = Integrated Quality Horticulture Development Project.Source: Study findings.


Agro-industry and processing appraisal and supportDAM does not perform any services in this area. It collaborates on a very limited scale with BSCIC, the Bangladesh Agro-Processors’ Association and others – including BARI, which generates tech-nology for agroprocessing, and DAE, which dis-seminates the technology to end users.

Development of policy and strategy papersDAM is weak in policy development and the formulation of strategy papers for agribusi-ness promotion. A comprehensive policy for agribusiness development, including the nec-esassary legislation, should be formulated in collaboration with policy and legal experts from agencies responsible for agricultural production, trade, industry, technology and fiscal issues. Such a policy would provide a clear framework and strategies for agribusiness development. To address this important task, capacity building of DAM staff is urgently needed.

Lobbying and advocacy in the agribusiness sectorDAM provides negligible services in this area. The needs here are related to those for DAM’s support to collective action and alliance building, which also requires lobbying and advocacy. Again, DAM is hampered by a shortage of staff, logistics support and budgetary arrangements.

Sharing of knowledge and information pertaining to the agribusiness sectorDAM activities in this area include arranging consultations, organizing conferences, partici-pating in fairs and exhibitions and, recently, establishing a Web site. However, these efforts are limited by the absence of an adequate plan, trained staff and funds.

3.4 perforMAnce of DAMoverall performanceDAM is the only organization responsible for promoting market linkages and agribusiness

TABLE 5Service areas and capacity analysis of DAM

no. Service area Staff allocation (estimated no. of staff)

relative importance of service in terms of

funding*

capacity level**

1. Appraisal of business models 3 7 2–3

2. Value chain analysis 5 6 2–3

3. Building of business and entrepreneurial skills

2 8 3

4. Reinforcement of business and market linkage services

6 4 2–3

5. Support to collection action and alliance building

5 9 2–3

6. Finance and investment appraisal and support

8 3 2–3

7. Trade and marketing appraisal and support

5 2 1–2


7 1 2–3

9. Development of policy and strategy papers

7 10 3

10. Lobbying and advocacy in the agribusiness sector

5 11 2–3


8 5 3

* From 1 (most funding allocated) to 11 (least funding allocated).** 1 = none; 2 = basic; 3 = moderate; 4 = advanced.IQHDP = Integrated Quality Horticulture Development Project.Source: Study findings.


development in Bangladesh. However, it is not yet fully functional because of a deficit in person-nel, inadequate financial resources and manage-ment weaknesses described in the following strengths, weaknesses, opportunities and threats (SWOT) analysis.

SWot analysisA summary of the SWOT analysis of DAM’s institutional capacity in relation to the services it offers is presented in Table 6.

Strengths: DAM is the de facto agribusiness unit, but its key strength stems from its legal founda-tion with a structure and functions for market-ing that are mandated by the Government of Bangladesh. Its able leadership is another strength that will be instrumental in reforming its services. The head of DAM comes from the MOA and has proven administrative leadership capability. DAM’s activities are funded from development projects, particularly the FAO project on market information services, and BADP and NCDP, both of which are funded by ADB. DAM has achieved significant development through the implementa-tion of NCDP, and has equipped itself to perform its functions more smoothly than ever before. Through these projects, DAM has established a strong presence at the district level, giving it a comparative advantage.

Development of DAM’s Web site has provided a new mechanism for rapid information dissemi-

nation to clients. The proposed restructuring of DAM will help it to provide demand-driven services through the expansion of its geographical area of coverage, logistics facilities and human resources. The restructuring will institutionalize DAM as the agribusiness unit, DAMA, reinforc-ing its legal basis. DAMA is expected to build functional partnerships with other agencies work-ing directly or indirectly for agribusiness develop-ment. Proposals for DAMA include provisions to expand staffing levels from the current 475 to 3 365 positions, enabling it to implement new func-tions in the marketing of agrocommodities and agribusiness development.

Weaknesses: DAM’s institutional weaknesses are structural and caused by a lack of competent staff. Its current organizational structure stifles its capacity to deliver services, while staff lack skills and experience in marketing and agribusi-ness management. The weak performance of the management committee is partly due to a lack of experience and management skills. Most of the staff involved in marketing management have limited management skills.

Staff are required to perform tasks unrelated to their official job functions, leading to the relatively low productivity of the organization as a whole.

Opportunities: The current national and global situations give DAM numerous opportunities to exercise its mandate and contribute to marketing

TABLE 6SWot analysis of DAM

Strengths Weaknesses

� Government mandate for developing agricultural marketing

� Experience of and familiarity with agribusiness development

� Direct implementation of agribusiness projects

� Strong presence at the district level

� Strong support from donors and development partners

� Immediately deployable learning effects from BADP

� Fund mobilization/leveraging from BADP and/or other official development assistance

� Web-based network for information collection, analysis and dissemination

� Limited human and financial resources

� Inadequate technical capacity of staff in all areas of agribusiness development

� Structural deficiencies that weaken its power and authority

opportunities threats

� Supportive agribusiness policy environment

� Adequate public and private institutions supportive of agribusiness initiatives

� Relatively wide areas for sourcing processing and value-addition investments

� Delayed reorganization

� Functions may be transferred to other organization(s)

� Negative image among other government agencies



and agribusiness development: the policy environ-ment is supportive of agribusiness development; incentives and business opportunities encourage the establishment of MSMEs; and government partners have established institutions and services to support agribusiness development, including production, processing and marketing in both domestic and foreign markets. NARS research centres at the national and regional levels have developed numerous production technologies, which are now being disseminated to users by DAE and NGOs. In addition, both public and pri-vate universities have opened agribusiness depart-ments to educate students in this subject area.

The Ministry of Commerce, the Ministry of Industry, the MOA, the Hortex Foundation, the SME Foundation and other private sector institutions provide training on a wide range of business and related areas. Coordination among agencies is being strengthened, and donors are encouraging investment in agriculture and agri-business development.

The government has created the Agro Products Business Promotion Council, under the Ministry of Commerce, for the promotion of sector-wise product diversification, quality improvement and export marketing of agroproducts – all of which support agribusiness development. Finally, MSME financing is being extended to more clients, by both private and government banks through the SME Foundation.

Threats: The major threat to DAM is the delayed implementation of its reorganization. Further delays will likely hinder marketing and agribusi-ness development in Bangladesh. The other main threat is the bureaucracy within the MOA, which exerts too much control over DAM’s operations,

compromising its execution of vital services and development activities.

3.5 inStitutionAL coMpArAtive ADvAntAgeS

While other departments in the MOA have func-tions that support agribusiness development, DAM’s comparative advantages in this area stem from: i) its mandate for efficient management of the marketing of agricultural commodities/products, from primary production to the delivery of final products to consumers; ii) the consensus/support of development partners and the govern-ment regarding its role in implementing agribusi-ness development projects; iii) its organizational structure with staff and line functions; and iv) its visibility and presence at the district level. DAM’s mandate to manage the marketing of agricultural commodities represents the most extensive author-ity linked to agribusiness development vested in a single department. This authority, which is currently considered de facto, is expected to be reinforced as soon as the proposed reorganization of DAM is approved by the government.

The consensus of development partners and the government that DAM should implement agribusiness projects gives the department access to development funds and other resources, which constitute its main source of funds for promot-ing agribusiness development. These funds are complemented by the line function that allows DAM to implement agribusiness projects at the district level.

DAM’s implementation of development pro-jects at the district level enables it to develop links to local authorities, including well-estab-lished relationships with the different subsectors involved in agribusiness development.

19

Capacity building needs have two main elements: the supply side, where DAM and other service providers (e.g., financial institutions) need to adopt new functions for agribusiness development; and the demand side – the various end-users of DAM’s services, particularly small farmers/producers and MSMEs, which are also important stakeholders of DAM and represent a vital segment of agrifood systems. Any attempt to improve the efficiency of the value/supply chain requires the organization of small farmers/entrepreneurs, who frequently lack access to markets and assets for responding competitively to market needs, especially local markets. Support to the organization of small farmers/producers is an important part of DAM’s mandate, and is essential to the promotion of agribusiness development. The Government of Bangladesh recognizes the importance of these end-users and has expressed its support through various policy papers such as the Poverty Reduc-tion Strategy Paper and the Millennium Develop-ment Goals.

4.1 Development pathThe government is making efforts to strengthen DAM’s capacity to respond to the challenges of promoting agribusiness development, as clearly seen in the pending legislation that will require DAM – as DAMA – to focus only on agribusiness functions and abandon its marketing regulatory activities. The government views DAM’s primary role in developing agri-enterprise activity as being to target small producers in rural areas, who need to be brought into the mainstream to ensure suc-cessful and equitable agribusiness development.

The government’s NAP 2010, defines vari-ous initiatives and pathways for improving agri-cultural marketing and agribusiness: i) market infrastructure development; ii) market intelligence and extension services; iii) export and market pro-motion; and iv) market regulation and facilitation. In all of these initiatives, NAP 2010 distinguishes clearly between government and private sector roles. In market infrastructure development, for example, the private sector is encouraged to increase its investments in warehouses and cold

Chapter 4

Capacity development priorities

storage facilities, while the government provides a policy/institutional environment that is conducive to private sector investment in agribusiness. The government role envisioned in NAP 2010 is essen-tially that of facilitator, providing the right mix of policies and incentives to foster agribusiness devel-opment. Among these initiatives, the government has committed to providing a functional market research, development and extension (RD&E) service to ensure adequate market information and better delivery of extension services, particularly for high-value crops and products. Export promo-tion and market facilitation will be encouraged by non-restrictive policies and programmes.

4.2 priority areas for CapaCity builDing

Given the current institutional weaknesses of vari-ous agribusiness players in Bangladesh, capacity building will require the design of different types of training programme to address the needs of both suppliers and end-users, with priority being given to the various levels of DAM. Training activities should be linked to the four pathways envisaged in NAP 2010, to ensure the desired results. Assess-ment of the services provided by DAM (Tables 2 and 3) suggests areas and subjects/topics where enhanced capacity is needed. Training in these areas should be linked to well-defined results. The following capacity building needs were defined based on results consistent with the overall goal of developing agriculture in Bangladesh.

agribusiness policy formulationWhile aspects of agribusiness are mentioned in strategic documents, such as NAP 2010 and the government’s industrial policy, there is no clear and coherent policy framework for agribusiness development, and this lack is a deterrent to the accelerated development of agribusiness in Bangla-desh. A comprehensive policy would also facilitate the planning and implementation of agribusiness projects by the public and private sectors and development partners, by detailing the strategies, action plans, timeframes and responsibilities of dif-ferent players. Design of an agribusiness develop-


ment policy could be included in the work of the 12-member Expert Committee tasked to review the structure of DAM and to design legislation to replace the current Agricultural Marketing Act.6

The Agribusiness Cell, tasked to facilitate PPPs for agribusiness development, is also stalled by a lack of clear guidelines and areas identified for pri-vate investment. Although PPPs are recognized as key drivers of increased private investment in Bang-ladesh’s agriculture – especially from transnational corporations investing in contract growing – they are hampered by the lack of clear rules for their formation. Local problems arising from the lack of a clear agribusiness policy are related to: i) market congestion; ii) poorly designed and improperly situated market infrastructure; and iii) high market losses resulting from ill-conceived transport poli-cies and poor post-harvest management.

market access and development Enhanced market access and market development are essential complements to the government’s support to small producers in responding quickly to local market needs. Activities for market development include conducting market studies such as benchmarking, intelligence gathering, analysis of competition, analysis of food product trends, and supply and demand studies. Results of these analyses will be useful in identifying the strengths and weaknesses of high-value agrocom-modities, to guide the design of future interven-tions and action plans for making these products globally competitive.

An important element of market access and development is establishing a functional database, including data on potential products, technologies and market segments, which private investors could use to identify and exploit agribusiness opportunities. DAM envisages coordination with relevant agencies in both the public and pri-vate sectors to identify data requirements, and will need support in packaging product profiles and communications for dissemination. It plans to collaborate closely with NARS to identify commercially viable technologies for adoption by farmers (crops and fisheries) and agribusi-nesses, and will rely on BARI and the Bangladesh Fisheries Research Institute (BFRI) for adaptive research, especially in post-harvest management and value addition.

6 The legislation proposed to replace this act is the Bang-ladesh Agricultural Marketing and Agribusiness Act.

market and product promotionDAM is developing a National Marketing Pro-gramme to promote high-value agrocommodities in both domestic and international markets. This programme will serve as the roadmap for improv-ing domestic marketing and achieving global mar-ket expansion targets.

The market promotion activities that need to be improved and refined in consultation with the private sector and other government agencies include trade fairs and exhibitions, market test-ing, and in-store promotion Specialized skills in organizing and participating in fairs, exhibitions, etc. are needed, to make these events more attrac-tive to prospective agribusiness investors.

strengthening capacity to manage sps standardsMore emphasis should be given to promoting awareness of SPS management among agrofood chain stakeholders. Strengthening SPS manage-ment could narrow the gap between domestic and international standards, enabling Bangladesh to create a better platform for expanding its exports. Skills are needed to improve domestic food safety and promote the adoption of safer and more sus-tainable agricultural practices.

For instance, extension service providers such as DAE, DOF and the Hortex Foundation have roles in promoting GAP to ensure that farm-ers follow recommended dosages and appropri-ate pre-harvest intervals when using agricultural chemicals. Promotion of good hygienic and manu-facturing practices and quality management is essential to improving food safety and minimiz-ing deleterious environmental effects and other risks. However, extension providers do not have adequate information on GAP to disseminate to their clients because results from adaptive research and trials are lacking.

market information and intelligence Market information is critical in keeping small farmers/producers up-to-date regarding consum-ers’ demands and changing preferences. Most entrepreneurs in Bangladesh are in the micro- and small business category and have no access to the Internet or other information systems.

The extension services of public organizations do not provide market intelligence information, and trained staff are lacking. This gap is particu-larly acute at the local level (municipal, district and upazila) in rural areas, where most small producers are situated. Developing an appropriate database

Chapter 4 – Capacity development priorities 21

could be included among the major activities of DAM, enabling it to release accurate informa-tion and guidance on prices, buyer contacts, distribution channels, buyer and producer trends, import regulations, competitor profiles, grade and standard specifications, production, post-harvest handling and other issues. To achieve this, DAM needs investments in a market information system linked to its Web site, which currently provides scant market information. Scaling up of the FAO-funded market information services project is viewed as a good step towards strengthened mar-ket intelligence.

strengthening farmers’ linkages to marketsUncoordinated and highly fragmented agricul-tural supply chains restrict the ability of farmers and enterprises to capitalize on more remunerative market opportunities. Agroproducts often have to pass through several levels of intermediaries before reaching consumers, contributing to higher costs and losses along the market chain. Fostering well-coordinated supply chains can bring many advantages, such as reduced costs and losses dur-ing transportation and storage; access to technolo-gies, capital and technical and market information; tracking and tracing of the sources of produce; and better control of product safety and quality. In some cases, a well-coordinated supply chain can also provide opportunities for risk sharing among partners in the chain. Farmers’ bargaining position can be enhanced by fostering collective organi-zations (producers’ groups, associations, coop-eratives, etc.), educating farmers about contracting operations, training farmers in contract negotia-tions, and enabling speedier entry into markets by more contracting firms, to increase competition. Links between small-scale farmers and organized supply chains are lacking in Bangladesh.

industry linkages and supportDAM needs a well-structured mechanism and platform for ensuring effective industry linkages to and support from concerned institutions, both public and private. The capacity to undertake this activity depends on the availability of budget. The suggested mechanism could take the form of bilateral consultations with agribusiness stake-holders, but this requires technical expertise in promoting collective action. Effective collective action requires the establishment of agribusiness networks, exploitation of economies of scale – and in some cases of specialization – and promotion of value-added products. DAM has very limited

skills in these areas. Among the institutions that DAM should link to are public organizations, notably DAE, DOF, BSTI, BARI and BFRI; industry associations such as the Bangladesh Fish and Shrimp Foundation, the Hortex Founda-tion and the SME Foundation; and local private organizations and NGOs.

4.3 potential roles anD instruments for fao support

The capacity gaps affecting DAM’s service provi-sion (Table 2) arise from several constraints: i) agricultural production is still largely traditional and unorganized; ii) value chains, including those introduced by donor-funded projects, tend to be weak and fragmented; iii) SMEs in agro-industry are underdeveloped; iv) intersector connectivity (e.g., RD&E, finance and transport) is limited; and v) domestic market standards are low, and global markets underexploited. These constraints should be addressed with a view to improving the agribusiness environment. For FAO to be effective, efficient and visible in Bangladesh, its support should revolve on two activities that are consistent with its core services: i) providing innovative technology support to private entre-preneurs and farmers in exploiting agribusiness opportunities; and ii) assisting the development of enabling conditions for expanding local and global markets.

outcomes and outputsOutcome – improved enabling conditions and technological support for agribusiness: Based on the assessment reported in this study, and the terms of NAP 2010, FAO is expected to demonstrate its comparative advantage through improved enabling conditions (policy and institutional environment) and technology support for agribusiness. This outcome supports the objectives of Bangladesh agriculture for improved food and nutrition secu-rity and increased agricultural production and productivity. The proposed FAO intervention will include agribusiness policy/institutional sup-port, small investments for piloting innovative technologies, and associated technical assistance. These interventions will provide opportunities for DAM and other major stakeholders to enhance their skills in using new policy tools, monitoring and other investment instruments, and applying or scaling up successful piloted technologies.

Outputs: Four outputs are expected to support the achievement of this outcome:


a. Formulation of an agribusiness policy/framework: A coherent agribusiness policy framework will remove the uncertainties for private sector investments in agribusiness opportunities. It will also assist the 12-mem-ber Expert Committee in crafting important policy pronouncements/legislation and pro-mote the required institutional strengthen-ing for effective enforcement of agribusiness policies and agricultural policies in general.

b. Strengthened value chains for high-value crops: This output will weaken the con-straints to enterprise formation in the agricul-ture sector, including by defragmenting value chains. It will improve and create enabling regulatory and business-friendly conditions for high-value crops and other agricultur-al commodities; provide a solid foundation for developing more vibrant agro-industry entrepreneurship; promote stronger links between production and markets; and stand-ardize primary production. Deepening the value chain and introducing innovations for vertical integration can help small producers/farmers to ensure supplies, control inputs, capture more value, achieve economies of scale and/or obtain access to information.

c. An improved marketing database: This out-put will establish a functional database for agribusiness information linked to the cur-rent Web site of DAM. The ultimate aim is to have a single Web portal or knowledge emporium providing user-friendly access to successful agribusiness models (download/upload) for entrepreneurs. Ongoing activities under the FAO-funded market information services project can be scaled up to achieve these objectives.

d. Expanded market opportunities through investment and market studies: This output will increase the number of capital projects by preparing concrete investment proposals that DAM can use to solicit funding from multilateral donors (e.g., ADB, the Interna-tional Fund for Agricultural Development, the World Bank and the European Union). The Rural Infrastructure and Agro-Indus-tries Division and the Investment Centre of FAO have the expertise to undertake this activity, and DAM can leverage this assis-tance to secure funding for its agribusiness-related projects.

23

1. A simple, de facto and one-dimensional agribusiness unit: The MOA has designated DAM Bangladesh’s agribusiness unit. How-ever, DAM is essentially a marketing agency whose primary mandate is to ensure efficient and effective marketing services for produc-ers and consumers. It branched out into agri-business services mainly at the suggestion of development partners, with the endorsement of the Government of Bangladesh. Govern-ment approval stems from the policy pro-nouncement espoused in NAP 2010, whose forward perspective on agribusiness is “pro-moting agriculture competitiveness through commercialization of agriculture”. The legal basis for the establishment of DAM is the 1954 Directorate of Agricultural Marketing. Pending approval of the reorganization plan, which aims to convert DAM into DAMA, DAM remains the de facto agribusiness unit.

Notwithstanding its de facto status, DAM is by far the best organization for promot-ing agribusiness in Bangladesh, because of the power and authority vested in it, par-ticularly its twin staff and line functions. The organizational model adopted by the government is a simple one, running from the national to the local level. This organi-zational context (with fewer organizational levels) should simplify the provision of agribusiness services, without necessarily requiring additional resources.

2. Relatively clear linkage between the Agri-business Cell and other public and private agencies: DAM has clear links to the recently established Agribusiness Cell at the MOA. The cell is a liaison office whose main task is to promote PPPs as key drivers of agribusi-ness, which also support DAM’s mandate. There is a clear delineation of responsibilities relative to promotion of agribusiness among DAM and the other agencies that DAM regards as its stakeholders. For instance, RD&E and finance activities belong to the technical and financial agencies, while the

Chapter 5

Key findings

private sector has a role in agribusiness net-working. While these agencies carry out their respective activities independently, the responsibility for coordinating them and ensuring consistent support for agribusiness lies with DAM. However, DAM appears to be weak in this area, and it is this lack of coordination capacity rather than the frag-mentation of services that is the main issue.

3. Weak financial and human resources of DAM: The budget of DAM – amounting to US$2.4 million in 2011/2012 and represent-ing less than 1 percent of the total MOA budget – is barely enough to cover salaries and minor overhead expenses. Although DAM receives additional resources from development projects, amounting to US$1 million, these can be spent only on project-related activities. Shortages of funds and personnel (compounded by existing staff’s inadequate and redundant skills) are typi-cal of public bureaucracies and affect the quality and delivery of services. However, although the donor funding for agribusi-ness activities that DAM receives is project-specific, it is likely to have multiplier effects (e.g., through increased local investment). DAM needs to be able to source sufficient development loans to reduce the strain on counterpart funds.

4. Agribusiness services induced primarily by development/donor funds: Of the 11 agri-business service areas assessed in this study, DAM considers five to be core services, two of which (appraisal of business models and building of business and entrepreneurial skills) are donor-initiated, while three (devel-opment of policy and strategy papers, lobby-ing and advocacy in the agribusiness sector, and sharing of knowledge and information) depend on the availability of local funds. Lobbying and advocacy in the agribusiness sector are sporadic activities, while knowl-edge and information sharing is still at the


planning stage. Therefore, developing policy and strategy papers is effectively DAM’s only regular activity. Value chain analysis, which is considered a secondary activity, is under-taken only through the ADB-funded project, and the other five secondary activities are carried out through BADP and IQHDP, both funded by ADB.

The assessment found that DAM’s instru-ments and capacity for providing these ser-vices are inadequate. Recommended instru-ments range from basic tools (e.g., financial analysis) to generic ideas (e.g., participatory market investigations), none of which can be considered innovative. DAM’s capacity to provide services was rated as basic to moder-ate (scoring 2–3), because of the mismatch between staff skills and requirements.

5. DAM’s comparative advantages: The com-parative advantages of DAM stem from: i) its mandate to manage the marketing of agricul-tural commodities/products from primary production to the delivery of final products to consumers; ii) the consensus of develop-ment partners and the government regarding its role in implementing agribusiness devel-opment projects; and iii) its visibility and presence at the district and subdistrict levels. SWOT analysis clearly shows that DAM’s strengths outweigh its weaknesses. In addi-tion, DAM’s reorganization into DAMA will make it the legally constituted unit for agribusiness.

6. Capacity building transcends the organiza-

tional deficiencies: The deficiencies of DAM and other stakeholders in the agribusiness sector are among the many considerations that justify an intervention to develop the necessary institutional skills. A capacity assessment of agribusiness services would

demonstrate that there are fundamental con-straints within Bangladesh’s agribusiness sec-tor that need to be addressed to provide a better idea of capacity building needs. These fundamental constraints are: i) agricultural production is still largely traditional and unorganized; ii) value chains, even when introduced by donor-funded projects, are weak and fragmented; iii) SMEs in agro-industry are underdeveloped; iv) intersec-toral connectivity (e.g., RD&E, finance and transport) is limited; and v) domestic mar-ket standards are low while global markets are underexploited.

7. FAO support to focus on results: FAO can maximize its assistance by working to achieve the outcome of improved enabling conditions and technological support for agribusiness, which is congruent with the broader objec-tives of improving the agribusiness sector in Bangladesh. To achieve this outcome, four outputs are considered essential: i) formula-tion of an agribusiness policy/framework; ii) a strengthened value chain for high-value and other commodities; iii) an improved database on markets; and iv) expanded mar-ket opportunities through investment and market studies. Achievement of these results is expected to complement large donors’ capital investments in establishing a vibrant agribusiness sector. FAO support would best take the form of a mixed grant portfolio, including agribusiness policy/institutional support, small investments for piloting inno-vative technologies, and associated techni-cal assistance. These interventions will pro-vide DAM and other major stakeholders with opportunities to improve their skills in using new policy tools, monitoring and other investment instruments, and applying or scaling up successful piloted technologies.

25

Mr Sidiqur Rahman Director, Department of Agricultural Marketing,Ministry of Agriculture, Khamarbari, Dhaka.

Mr Md Shafiqur Rahman Shaikh, Chief (R&D) Department of Agricultural Marketing,Ministry of Agriculture, Khamarbari, Dhaka.

Mr Md Mahmood Hasan Project Director, Agribusiness Development Project,4th Floor, Sech Bhaban, Manik Mia Aveue, Sher-e-Bangla Nagar, Dhaka-1207.

Dr Hassanullah Agribusiness Promotion Specialist, Agribusiness Development Project, 4th Floor, Sech Bhaban, Manik Mia Aveue, Sher-e-Bangla Nagar, Dhaka-1207.

Mr Md Abdul Wadud Marketing Management Specialist, Agribusiness Development Project, 4th Floor, Sech Bhaban, Manik Mia Aveue, Sher-e-Bangla Nagar, Dhaka-1207.

Mr Imanun Nabi Khan Agribusiness Promotion Specialist, Agribusiness Development Project, 4th Floor, Sech Bhaban, Manik Mia Aveue, Sher-e-Bangla Nagar, Dhaka-1207.

Mr Md Abdur Rashid Deputy Director (Market Information), Department of Agricultural Marketing, Ministry of Agriculture, Khamarbari, Dhaka.

Ms Shanaz Begum Neena Project Director, Integrated Quality Horticulture Development Project-2nd Phase, Department of Agricultural Marketing, Ministry of Agriculture, Khamarbari, Dhaka.

Annex 1

People interviewed

Mr Munshi Abdul Ahad Deputy Chief (Planning & Development), Department of Agricultural Marketing, Ministry of Agriculture, Khamarbari, Dhaka.

Ms Nasrin Sultana Assistant Director, Department of Agricultural Marketing, Ministry of Agriculture, Khamarbari, Dhaka.

Mr Mitul Kumar Saha Assistant General Manager (Marketing), Hortex Foundation, Sech Bhaban, Manik Mia Aveue, Sher-e-Bangla Nagar, Dhaka-1207.

Mr Md Rafiqul Islam Assistant General Manager (Production), Hortex Foundation, Sech Bhaban, Manik Mia Avenue, Sher-e-Bangla Nagar, Dhaka-1207.

Dr Md Anisur Rahman Supply Chain Knowledge Management Expert, National Agricultural Technology Project, Hortex Foundation, Sech Bhaban, Manik Mia Avenue, Sher-e-Bangla Nagar, Dhaka-1207.

Mr Md Mahbubul Alam Business Development Expert, National Agricultural Technology Project, Hortex Foundation, Sech Bhaban, Manik Mia Aveue, Sher-e-Bangla Nagar, Dhaka-1207.

Dr Srikanta Sheel Logistic (Packaging & Transportation) Expert, National Agricultural Technology Project, Hortex Foundation, Sech Bhaban, Manik Mia Aveue, Sher-e-Bangla Nagar, Dhaka-1207.

Dr Md A.Rashid Training & Communication Expert, National Agricultural Technology Project, Hortex Foundation, Sech Bhaban, Manik Mia Aveue, Sher-e-Bangla Nagar, Dhaka-1207.


Ms Shahanaj Begum Former, Project Director, Agribusiness Development Project, DAM.

Mr Abul Ashraf Former, Market Management Specialist, Northwest Crop Diversification Project, Department of Agriculture Extension, Khamarbari, Farmgate, Dhaka-1215.

Dr Md Saleh Ahmed Post-harvest Handling & Quality Assurance Expert, National Agricultural Technology Project, Hortex Foundation, Sech Bhaban, Manik Mia Aveue, Sher-e-Bangla Nagar, Dhaka-1207.

Mr Mia Abdur Rashid Former Additional Director, Department of Agriculture Extension, Khamarbari, Farmgate, Dhaka-1215.

Mr Md Shajahan Ali Badsha Proprietor, Maa Moni krishi Khamar; Solimpur, Shurdhi, Pabna.

Mr Md Shafiqur Rahman Senior Lecturer, State University of Bangladesh, 27 Dhanondhi, Dhaka-1207.

Dr M.A. Rashid Chief Scientific Officer, Horticulture Division, Bangladesh Agricultural Research Institute, Joydebpur, Gazipur.

Dr Md Atikullah Head, School of Agribusiness, Atish Dipankar University of Science & Technology, Banai, Dhaka.

Mr Md Mokbul Hossain Joint Secretary, Ministry of Forest & Environment, Secretariat, Dhaka-1000.

Mr Md Monirul Haque Nagvi Chie Farm Manager, BADC, Krishi Bhaban, Dilkhusha, Dhaka-1000.

Prof. Dr Fokhrul Islam Department of Agricultural Economics, Banghabondhu Agricultural University, Salna, Gazipur.

27

Annex 2

Current organogram of DAM


Pers

on

nel

31

X C

hie

f (R

&D

)1

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ten

oty

pis

t1

X M

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nel

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no

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Pers

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nel

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29

Annex 3

Proposed organogram of DAMA


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The agrifood system is changing rapidly in response to agricultural moderni-zation and shifting consumer and societal demands for safer, better-quality and more convenient food. This new scenario coexists with more traditional types of family and subsistence farming.

This changing environment places increased pressure on Ministries of Agriculture (MOAs) in developing countries to engage in agribusiness and agro-industry development. For this reason, over the past decade, many MOAs have established agribusiness units with technical, policy and coordi-nation functions. To perform well, these units should be given clear manda-tes and sufficient financial resources and qualified staff familiar with current agribusiness developments, such as value chain programmes, climate-smart agriculture, contract farming and public–private partnerships. However, this ideal scenario rarely occurs. A change in the mind-set of MOA staff is requi-red to move beyond the traditional focus on production towards a more holistic, farm-to-fork approach that includes post-production issues; and this might prove to be quite a challenge.

To shed light on the role, performance and empowerment of these agri-business units, FAO conducted a scoping survey of 71 countries and in-depth analyses of 21 case studies from Africa, Asia and Latin America. The primary objective was to draw lessons that can provide guidance to member coun-tries on how to establish and operate well-performing agribusiness units. The outcome is presented in this series of country case studies, which con-tribute to enriching knowledge and sharing information on institutional responses for enhancing the public commitment to inclusive agribusiness and agro-industrial growth and job creation.

PUBLIC SECTOR SUPPORTFOR INCLUSIVE AGRIBUSINESS

DEVELOPMENT

An appraisal of institutional models in Bangladesh

Food and Agriculture Organization of the United Nations (FAO)Viale delle Terme di Caracalla, 00153 Rome, Italy

www.fao.org

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PUBLIC SECTOR SUPPORT FOR INCLUSIVE AGRIBUSINESS DEVELOPMENT · Public sector support for inclusive agribusiness development ... DOF Department of ... 3. public sector support for