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Agricultural mechanization in Bangladesh

Agricultural mechanization in Bangladesh

With the world’s highest population density (of countries with a substantive landmass) and highest per-capita rice consumption (172.6 kg person  FAOSTAT, 2015), the Government of Bangladesh (GOB) has historically encouraged agricultural intensification and mechanization as an avenue to increase production and move towards rice self sufficiency (Mainuddin and Kirby,2015). To facilitate this process, the GOB voluntarily reduced import restrictions and tariffs on select agricultural machineries , and developed subsidy programs to partially offset fixed costs for 2WTs, irrigation pumps, and threshers (GOB, 1999). Irrigation pumps were first introduced by the GOB in the 1960s (Ahmed, 2001). Their supply was later sustained by the private sector following the GOB’s voluntary liberalization of the machinery market and relaxation of import tariffs from 1988 to 1995 (Hossain,2009; Gisselquist et al., 2002).

The GOB also initially promoted four-wheel tractor based mechanized tillage, which is arguably scale-inappropriate given Bangladesh’s average farm size ofaround 0.53 ha, which is usually further fragmented into multiple fields (Hossain et al., 2007). Such fragmentation makes demand aggregation for tillage services among farmers, and between field and-farm transport diff i cult to achieve with larger tractors.The GOB also first introduced centralized irrigation facilities by establishing Deep Tube Wells (DTWs) and supplying surface water Low-Lift Pumps (LLPs) to farmers on a rental basis from the Bangladesh Agricultural Development Corporation (BADC), with fuel supplied at a 75% subsidized rate until the late 1970s (Hossain, 2009). By 1978, BADC had rented out and managed a total of9000 DTWs and 35,000 LLPs (IDE, 2012).

Public irrigation management and use of larger tractors for land preparation, however presented large logistical and financial burdens. Eight years after independence in 1979, Bangladesh undertook liberalization policies, with the GOB gradually opting out of State-led mechanization support (Gisselquist et al., 2002). BADC initiated sales to liquidate DTWs and LLPs, first to farmers’ cooperatives, and later to individual farmers, many of whom became service providers (Hossain, 2009). Privatisation however only gained real momentum only after the removal of tariff and non-tariff barriers on the import of irrigation and diesel engines and tractors, policy actions which were precipitated by disaster response actions on behalf of the Government.

On November 29, 1988, a cyclone with wind speeds of over 150 kmh hit Bangladesh (UNDRO, 1988). The cyclone took a major toll on human lives, and drastically reduced the draught oxen and water buffalo population used for land preparation. The total deficiency was estimated at approximately 5.8 million animals,equivalent to 132,000 2WTs, with significant implications for the timely planting of the subsequent rice crop (GOB,1989). During this period, the Standardized Committee of Bangladesh was responsible for controlling the quality of imported machinery, including agricultural equipment. The committee mainly prescribed the import of high-cost Japanese tractors, pumps, and engines, and discouraged more affordable Chinese machinery that they considered to be of low quality (Justice and Biggs, 2013). The urgency imposed by the cyclone and risk of food insecurity however prompted the GOB to reconsider this arrangement, as less expensive equipment was urgently required at a large scale. In 1988, then President Hussain Muhammad Ershad voluntarily eliminated most of the major import taxes on standardized diesel engines and 2WTs. In an effort to further facilitate the rapid import of comparatively less expensive machinery from China, he also disbanded the Standards Committee, and emphasized less expensive markets for 2WTs (Justice and Biggs, 2013). Six years later, the import 2WTs was made completely duty-free (IDE, 2012).

These actions resulted in a drastic increase in small diesel engine imports for mechanized irrigation and land preparation. The number of shallow tube wells used for irrigation increased from 93,000 in 1982 to 260,000 in 1990 (IDE, 2012). Currently, more than 550,000 power tillers, the vast majority of Chinese origin, are used to prepare over 80% of Bangladesh’s cropland (Ahmmed, 2014). A total of 1.63 million tube wells and LLPs are also used to irrigate nearly 55% of all cropland (BBS, 2011; BADC, 2013). In 2012e13, 112 importers invested USD 35 million to import 30,771 2WTs. In the same year, USD 0.1 million of mechanical seed drills and rice transplanters were also imported, the former of which can be attached to 2WTs for direct seeding (Krupnik et al., 2013), along with USD 2.5 million worth of spare parts (GOB , 2014a). In land and capital constrained rural Bangladesh, owners of agricultural machinery also tend to work as service providers (e.g. providing mechanized land preparation.

Agricultural mechanization in Bangladesh