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Public-Private Partnerships for Harnessing the Potential of Rainfed Agriculture

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October 19-20, 2005, …

October 19-20, 2005,
FICCI Federation House,
Tansen Marg, New Delhi, India


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  • 1. Public-Private Partnerships for Harnessing the Potential of Rainfed Agriculture Joachim von Braun International Food Policy Research Institute October 19-20, 2005, FICCI Federation House, Tansen Marg, New Delhi, India INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE
  • 2. Outline  PPP in agriculture: The main options and issues  Less favored/marginal rainfed areas: risks and opportunities  Possibility of PPPs in the supply chain management of high value and processed commodities INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 2
  • 3. Agri-food systems are increasingly … • Driven by market forces / consumers/ retail • Globalized through international trade • Influenced by new technologies • Subject to stricter regulatory scrutiny • Subject to greater ethical scrutiny  But peoples’ ability to respond to this changing context differs greatly between regions, nations and communities INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 3
  • 4. Opportunities for partnership exist Partnerships can improve access to • New technologies, and tools • New research expertise and infrastructure • Private equity markets; donor funding • New product markets and new customers • New marketing and distribution networks  Synergies through knowledge sharing, joint learning, scale economies, resource pooling, and cost sharing INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 4
  • 5. But roles remain contested With changes in the global agri-food system, the roles of the state, industry, and civil society remain contested  Controversy over ownership of new knowledge  Issues over distribution of benefits and risks  Concerns over lack of pro-poor emphasis  Unease over environmental, social sustainability Learning from others? e.g. the health and ICT sectors INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 5
  • 6. Yet our visions and goals often coincide  a world free of hunger and malnutrition  To provide solutions that cut hunger and malnutrition These goals are good on humanitarian grounds and good for business INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 6
  • 7. Real actions follow common interests Delivery, Private Public Civil Society Execution Planning, Financing Private Commercial Private support Private support projects to charitable to charitable public projects NGO projects Public Private Public projects NGO provision provision of of public goods public goods Civil Society NGO partnership projects INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 7
  • 8. Outline  PPP in agriculture: The main options and issues  Less favored/marginal rainfed areas: risks and opportunities  Possibility of PPPs in the supply chain management of high value and processed commodities INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 8
  • 9. What are “less-favored areas” (LFAs)?  Include areas with • low agricultural potential, due to limited rainfall, poor soils, steep slopes, etc. (biophysical constraints); or • limited access to infrastructure (e.g., roads and irrigation) and markets (socioeconomic constraints)  Some LFAs are found in: • semi-arid and arid tropics of Asia and Africa • mountain areas of Asia, Latin America and Africa • hillside areas in Central America and Asia • forest margins of humid and sub-humid tropics of Africa, Latin America and Asia INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 9
  • 10. CLASSIFICATION OF FAVORED AND LESS-FAVORED AREAS Access to infrastructure and markets High Favored areas Less-favored areas Low a Less-favored Less-favored areas areas High Low b Agricultural potential a Socioeconomic constraints. b Biophysical constraints. INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 10
  • 11. Why be concerned about LFAs? 1. Most of the poor live depend on these areas for their livelihoods: • Over 1 billion people live in such areas • Problems of low agricultural productivity, poverty, and natural resource degradation severe and worsening in many such areas • Problems in these areas give rise to conflict, emigration to other areas, negative environmental consequences INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 11
  • 12. Drought and famine risks… INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 12
  • 13. Droughts are the deadliest natural events… Droughts from 1900-2004 # of Events Killed Affected Africa 460 1,046,500 315,238,600 Americas 100 100 61,701,400 Asia 200 7,761,400 1,789,441,000 Europe 30 1,200,000 15,262,600 Oceania 25 700 8,233,600 EM-DAT: The OFDA/CRED International Disaster Database, Université catholique de Louvain INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 13
  • 14. Droughts involve significant economic costs… Economic losses due to drought in Eastern India Averaged over 30 During drought years years only Loss of rice production (million tons) 2.6 7.6 Value of rice production loss 250 735 ($million) Value of other crop production loss 125 370 ($million) Employment loss (million person- 160 480 days) Value of employment loss ($ million) 160 480 Total economic losses ($million) 535 1,585 Source:www.agric.uwa.edu.au/ARE/AARES/Conf2003/ClimateWorkshop/PandeyPresent.ppt INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 14
  • 15. Why be concerned about LFAs? 2. Contrary to general belief, returns to investments are often higher in these areas … INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 15
  • 16. Returns to Investments in India – Impacts on Agricultural Production (Fan and Hazell 1999) Irrigated High Low Investment Units areas potential potential rainfed rainfed areas areas HYV’s Rps/ha 63 243 688 Roads Rps/km 100,598 6,451 136,173 Canal Rps/ha 938 3,310 1,434 irrigation Private Rps/ha 1,000 -2,213 4,559 irrigation Electrification Rps/ha -546 96 1,274 Education Rps/ha -360 571 902 INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 16
  • 17. Returns to Investments in India – Impacts on Poverty Reduction (Fan and Hazell 1999) Irrigated High Low Investment Units areas potential potential rainfed rainfed areas areas HYV’s Persons/ha 0.00 0.02 0.05 Roads Persons/km 1.57 3.50 9.51 Canal Persons/ha 0.01 0.23 0.09 irrigation Private Persons/ha 0.01 -0.15 0.30 irrigation Electrification Persons/ha 0.01 0.07 0.10 Education Persons/ha 0.01 0.23 0.01 INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 17
  • 18. Returns to Investments in China – Impacts on Rural GDP (Fan, et al. 2004a) (yuan/yuan inv.) Investment Coastal Central Western R&D 5.54 6.63 10.19 Irrigation 1.62 1.11 2.13 Roads 8.34 6.90 3.39 Education 11.98 8.72 4.76 Electricity 3.78 2.82 1.63 Telephone 4.09 4.60 3.81 INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 18
  • 19. Outline  PPP in agriculture: The main options and issues  Less favored/marginal rainfed areas: risks and opportunities  Possibility of PPPs in the supply chain management of high value and processed commodities INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 19
  • 20. Opportunities for PPPs along the supply chain… PRODUCERS MARKETERS PROCESSORS RETAILERS CONSUMERS INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 20
  • 21. High value production on dry lands 1. Public Private Partnerships in Research and Development for varietal adaptation to climatic extremes TECHNOLOGY SHARING + RESOURCE MOBILIZATION INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 21
  • 22. ICRISAT Experience in India- Sorghum and Pearl millet Hybrid Parents Research Consortia  Initiated in 2000  Impact: • Increased adoption of improved hybrids:  More than 4 million ha of rainy season Sorghum and 1 million ha summer season sorghum are planted with 50 private-sector (PS) based hybrids, of which 40 are based on ICRISAT derived parental lines  4.5 million ha of pearl millet area is planted with more than 70 PS based hybrids, of which 60 are based on ICRISAT derived parental lines INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 22
  • 23. ICRISAT Experience in PPP for R&D in India (ctd) • Resource mobilization  From 2000-2003, members of consortia included 16 PS Sorghum companies and 18 for Pearl millet = mobilization of US$ 405,000  April 2004, an additional 25 PS seed companies members of consortia = US$ 2 million for ICRISAT funding over a five-year period INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 23
  • 24. High value production on dry lands 2. Partnership in water management in rainfed agriculture • Enhanced water use efficiency • Increased financing for system rehabilitation, improvement and upgrading INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 24
  • 25. Watershed management projects in rainfed areas- India  Objectives : • on-site soil and water conservation measures that improve the resource base for rainfed agricultural production. Increase productivity in rain-fed agriculture & Provide opportunities for planting high- yielding varieties INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 25
  • 26. Watershed management projects in rainfed areas- India (ctd)  Methods: • Emphasis on participatory management & knowledge sharing  Collaboration b/w Government, NGOs, village self-help groups (community-based PPPs)  Local people = full partners- Participation in helping plan, implementing and paying for watershed development programs INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 26
  • 27. High value production on dry lands 3. Infrastructure development- roads and information and communication technologies IMPROVE ACCESS TO MARKETS AND INFORMATION INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 27
  • 28. PPPs in infrastructure development  Public Sector will still be the major player (e.g. provision of initial capital)  Partnerships w/ NGOs, CBOs and private sector necessary in:  Choosing infrastructure projects that would yield the highest short run and long run benefits  Cost- sharing (esp. for maintenance ) INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE Page 28