With its developing economy, Bangladesh is heavily reliant on its agricultural sector. In the old days, the sector was major employer, income generator, and importantly the largest contributor to the GDP. However, since the late 1970s, its share has been declining, which currently stands at some 17 per cent (FY2014), down from almost 24 per cent (2000) (see Table 1). This is expected of a growing economy. The other sectors of the economy - manufacturing and services - however, also picked up, each increasing its share of contribution to the GDP by around 2-4 percentage points. The importance of the agriculture sector is reflected in employment in Bangladesh. Despite the declining share of agriculture in GDP, its contribution to overall employment in 2012 was some 48 per cent according to the World Bank data. A look at the growth rates of agriculture and total GDP of Bangladesh (Figure 1) shows that the latter consistently outperformed the former in the decades since 2000. Since 2009, the growth rate trajectories of these two sectors have gone in opposite directions, however.
These developments in the agriculture sector align well with extant theories of economic development and empirical annotations. In a way, this is a testament to the fledgling growth and dynamism in the non-agriculture sector of the economy. Yet, agriculture remains the most important sector for most developing countries due to its implications for food security, general livelihood, price stability vis-Ã -vis cost of living, health, and basic nutrition, inter alia. To keep the agriculture sector modern, vibrant, stable, growing, and internationally competitive, it is important to pursue a set of comprehensive and well-defined policies that enhance the sector's productivity in the long-run. Perhaps, it offers the only conduit to improve quality and quantity of agricultural output and general welfare of the population.
RECENT TRENDS IN THE AGRICULTURE SECTOR: Figure 2 elucidates the trends in three indicators - land, labour, and total factor productivity, between 2000and 2012. The total factor productivity in agriculture sector grew by more than 30 per cent during this period, while that of land and labour were even more remarkable - each grew at around 40 per cent and 60 per cent over the same period.
This notable performance in the productivity growth begs the question: how it all happened. A careful review of data since independence shows that Bangladesh invested heavily in research and development in, what used to be its primary economic sector, agriculture. The extraordinary work by researchers, field trainers, and farmers led to efficient use of land, fertiliser, irrigation and improvement in related technology and innovation. Notable among them are enhanced land fertility, crop rotation, mechanisation, use of improved seeds, etc.
A few laudable steps taken in agriculture include (a) the Integrated Agriculture Productivity Project (IAPP), designed to improve resilience of agriculture crops in northern or southern areas more prone to flash flood, drought, and saline from tidal surges. In addition, adaptation to new tech and mitigation programmes like heat-, drought- and saline-tolerant crops, better management efforts to improve soil health, and further diversification of rice production has been very effective.
(b) The Modern Food Storage Facilities Project (MFSFP) was initiated in 2007 to address potential food security crisis when Bangladesh could not procure rice in the international markets. The programme expanded grain storage infrastructure and strengthened the management of grain stocks. It will offer Bangladesh some legroom to withstand frequent threats to food security from natural disasters and external shocks.
(c) The Social Investment Programme Project (SIPP-III), known as the Nuton Jibon Livelihood Improvement Project (NJLIP), builds and strengthens community institutions. It funds and supports small livelihood, provides nutrition awareness, and offers agricultural production know-how by mobilising the economically vulnerable. NJLIP creates economic opportunities by forming producer groups, cooperatives, and societies that promote access to markets. Â
(d) The National Agriculture Technology Programme (NATP-II) helps the government to boost productivity, insure food security, encourage adaptation to climate change, and enhance nutrition through safe and more diversified food. The NATP-II focuses on better technology and farm production practices by helping small holders and women's participants.
Curiously, Bangladeshi farmers have embarked on substantial crop diversification schemes. They are increasingly participating in non-traditional cereal crop production such as, wheat and maize alongside the traditional staple - rice. It is an interesting paradigm shift. Cereal grains contain more food energy at any given weight, and are considered staple in many parts of the world. This is more profitable and is a viable non-traditional staple. More people are now willing to change their dietary habits. Bangladeshis, mostly the urban residents, appear to be more comfortable with consuming non-traditional cereals such as wheat and maize (often in the form of popcorn snack). Maize continues to be used largely as poultry feed, however. Cereal crops have also seen consistently rising trend except the two hiccups, albeit minor ones. The growth of cereal yields (Figure 3) clearly shows a consistent positive trend between 2000 and 2012. The cereal yield grew by more than 25 per cent - from 3,400 kg to 4,400 kg per hectare over the same period.
Improvements in agricultural productivity can be attributed to advancements in other areas as well. These include the government's initiatives in providing better input services, improved training for farmers, easy access to credit systems, expansion of rural banking, efficient functioning of commodity markets, and superior distribution networks. Many of these services helped to curb the influence of notorious intermediaries.
AREAS FOR FURTHER IMPROVEMENT: Despite such astonishing achievements, Bangladesh's agriculture suffers from several bottlenecks. Much of the farming continues to be at a subsistence level. Only a small fraction of the country's agricultural output makes to the marketplace; and eventually to the major cities, such as Dhaka, Chittagong, and Sylhet etc. While the country's agriculture has seen substantial diversification, the crop diversification issue remains insignificant compared to its peers (e.g., India, Vietnam, Indonesia etc.). The country relies heavily on its staple cereal - rice - while nutritional intake from pulses, vegetables, and fruits remains low, in contrast to other developing economies. According to the BBS data (2015), Bangladeshis consume 62 grams of vegetables a day against a recommended standard of 220 grams. Average Bangladeshis show very little interest in these food items. Pulses and vegetables are considered 'inferior' food thus, more appropriate for those with low income. Fruits, on the other hand, are part of the list of luxury goods! In other words, demand for fruits is income elastic; that is, its demand responds to change in income rather than to price. The spurt in fruit consumption has been concomitant with rise in income over the past few decades. However, the upsurge in vegetable consumption is credited to rise in health concerns.
Dr Muhammad Shafiullah is an Assistant Professor at the University of Nottingham Malaysia Campus. muhammad.shafiuallah@edu.my
Dr Faridul Islam teaches Economics at Morgan State University, USA. faridul.islam@morgan.edu
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Farmers adopt crop diversification schemes
Muhammad Shafiullah and Faridul Islam | Published: January 28, 2017 20:11:28 | Updated: October 22, 2017 06:53:22
Farmers adopt crop diversification schemes
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