By: Suresh Babu The structural adjustments of the 1980s and 1990s led to drastic fiscal cuts in financing of public extension systems causing their near collapse in many developing countries. Several new players tried to enter and fill the vacuum, including the private sector. Yet it is not clear how much and how well the private sector is able to fill the gap left by the dysfunctional public systems. This seminar is based on a recent book titled Knowledge Driven Development: Global Lessons from Private Extension (2015, Elsevier), a collection of case studies evaluating 10 private extension models in seven developing countries. The book assesses the functioning of private sector extension systems in various contextual settings. Common knowledge is that most private sector extension models are implemented for, and seem to work well for farmers selling high value commodities. But for staple commodity growers (such as cereal growers), with a small market surplus and little scope for contract farming, these systems may not be sustainable due to cost factors. Some of the case studies challenges this conventional wisdom. Lessons drawn from the cases could be important in giving direction to future development, research and policy on private extension systems. It is observed that private companies have created shared value for farmers across all cases. Integrated services provided as part of private extension programs were a major contributing factor for their success. Private extension programs also help in the effective use of technology for increasing farmer productivity. Additionally, they provide assured market access and price to contracted farmers, thereby reducing the uncertainty of demand to a great extent. Extension programs implemented by private companies lead to inclusive innovation by engaging farmers in development of technical and market solutions. They also reduce barriers to accessing quality inputs. Further, they tend to induce collective action amongst farmer groups, increasing solidarity. Private extension is demand driven, directly addresses information needs of contract farmers, and under certain conditions can fill the gap left by public extension systems in developing countries.

1. Can Private Sector fill
the gap in Agricultural
Extension?
INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE 1
Presented by:
Suresh Babu
Senior Research Fellow
International Food Policy Research Institute, Washington D.C.
at
The SASKI Brown Bag Lunch, World Bank, Washington D.C.
16th December 2015

2. Overview
 Introduction
 Conceptual Framework
Case Studies on Private Extension
Synthesis of Results
Conclusions
Challenges and way forward
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3. What is private extension?
The concept of private extension emphasizes three aspects, which includes:
 involvement of extension personnel from a private agency or organisation
 payment of services by the client through a service fee, directly or indirectly
 playing supplementary or alternative role to public extension services
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4. Why are private extension systems important?
• Declining budget allocation for the public extension by the Governments and donors
• Transformation of agriculture from subsistence level to commercialized agribusiness
• Concerns on efficiency and effectiveness of public extension
• Beneficiary contribution for ensuring demand driven and accountable extension provision
• Private extension to supplement and complement the public extension
• Decentralization of public extension
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5. Research questions
Private extension is demand-driven and its uptake is need-based, leading to the following questions:
• What is the difference between private and public extension systems? (Birner et al., 2009)
• What regulatory mechanisms and institutional arrangements must be developed to support
private extension?
• What are the latest innovations in extension provision?
• What are the motivations and incentives for private companies for knowledge sharing?
• What are the opportunities for private knowledge entrepreneurs (Dewhurst et al., 2013)
• What role can policymakers play in shaping and supporting inclusive innovation systems? (Foster
and Heeks, 2013a,b)
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6. About the book…
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To better understand different
models of extension delivery and
financing by private companies
across the agricultural value chain
To provide an assessment of what
are the factors leading to successes
or failures of various approaches
To draw lessons and
recommendations for future
endeavors.
Presents 10 cases of private
extension across 7 countries.
Using various data collection
methods, research techniques and
field interviews
Analyses of trends, commonalities
and differences among various
extension approaches
Rationale for the book Methods used

7. Conceptual Framework
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Operational Framework for Assessing, Analyzing, and Acting on Extension Reforms
The framework for assessment of private extension requires:
 Assessment of the current state of extension:
• Quantitative methods
• Qualitative methods
 Analysis of extension provision:
• Internal Factors
• External Factors
 Dialogue and consultations:
• Key Informant interviews
• Focused group discussions
 Action plan for reforms
 Program implementation, monitoring and evaluation
Assessment
Analysis
DialoguesAction plan
Implementation;
Monitoring and
Evaluation

8. Case Study I: EID Parry, India
 EID Parry is the oldest private sugar mill in India
Motivation for private extension provision:
• Regular supply of sugarcane for crushing needed
• The area under sugarcane cultivation is decreasing with
ourbanization;
osubsidy for cashew plantation;
o reducing water table
• Decrease in sugarcane yield
• Increase in labor wages
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Uniqueness
 Company has managed to break the
smallholder syndrome
 Effectively pulls the global, regional and
national knowledge needed for
successful cultivation of sugarcane by
the area farmers

9. Case Study II: Kenya Horticulture
Exporters (KHE)
 Kenya Horticulture Exporters (KHE) is a leading exporter of vegetables and fruits in Kenya
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KHE
Finance /
Input
Farmers
Loan repayment
Credit / Inputs
Extension Approach of KHE
Uniqueness
 KHE enables smallholders to capture
value in export markets
 It empowers them to understand and
work with international standards
 Create further value for local
communities by employing people in
processing, packaging and logistics

10. Case Study III: Rio de Una, Brazil
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 Rio de Una is a food processing company which connects farmers to the buyers of the fresh
vegetables
Uniqueness
 It is a win-win situation, where it is in
the best interest of the company and
the farmers is met
 Provides attractive employment
opportunities to rural youth
 Works well as viable alternative to
public extension systems for family
farms that meet minimum level of
agricultural production required
Vegetable farmers– Organic and TraditionalExtension Services
Extension / Technical
Associates
Credit
Organic certification
Equipment rental
Own seedlings
Research linkage
EMATER
Micro-irrigation
Rio de Una-Vegetable
processing and
packaging
Bob’s McDonalds
Other
retailersWalmart
Retail stores
Wholesale market
Consumer
Vegetable purchase
by Rio de Una
Vegetable Value Chain and the Role of Private Extension in Brazil

11. Case Study IV: Syngenta Frijol Nica
Program, Nicaragua
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Key Objective
To provide an integrated package of high-level
technological solutions, technical assistance, support
in market linkages, and education for bean
producers and their families through:
Knowledge Transfer
Technical Support
Financing
Uniqueness
 Program identified opportunities
to turn bean cultivation into a
highly technical, profitable activity
 The extension model combines
input supply and technical
assistance with financing as well
as partnerships with commercial
groups.
 The Frijol Nica program was initiated by Syngenta and a strategic partner, Rappaccioli
McGregor, S.A. (RAMAC) in 2006

12. Case Study V: Multi-Trex Integrated
Foods, Nigeria
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Uniqueness
 It makes profitability of cocoa production for
farmers a key consideration in its operation
 Focuses on production of high quality cocoa
 Enabled efficient communication and keeping
the extension service demand driven and
focused on issues highly relevant for the
smallholder cocoa production
Multi Trex works in the cocoa value chain and provides extension services designed to target
cocoa farmers and assist them to:
 Increase the quality of cocoa supplied through certification and good agricultural practices
 Increase their productivity
 Increase input availability for farmers
 Ensure regular supply of cocoa

13. Case Study VI: Jain Irrigation Systems
Limited, India
Jain Irrigation Systems Limited (JISL)is a multinational organization known for its pioneering
work in the micro-irrigation industry
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Uniqueness
 The successful vertical integration of
JISL extension program in the white
onion value chain from input provision
to processing
 Contract farming has increased
farmers’ return on investment while
creating profit for the company.
JISL Extension Program
• JISL provides agricultural inputs like seed, bio-
fertilizer, micro-irrigation system (e.g. drip), seed
planters, package materials (‘gani’ bags), and a
comprehensive package of extension services
• After harvest, the produce is bought back by JISL at
minimum support prices or market price,
whichever is higher
• On average, farmers have achieved 130% yield
increases.

14. Case Study VII: Marico Limited, India
Marico Limited is one of India's leading consumer product & services companies
operating in the beauty and wellness industry
 It is currently the largest buyer of safflower in India which is marketed under its
healthcare products in the safflower value chain to provide extension to farmers
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Uniqueness
 The program focuses on profitability of safflower production rather than only
increasing the levels of safflower production for its own supply
 Direct linkages between producers (farmers) and processors (industry) of safflower
seed tightens the supply chain, leading to more efficient communication and
coordination between actors

15. Case Study VIII: PRAN, Bangladesh
PRAN is the largest certified agro food exporter in the agro processing sector in
Bangladesh
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Uniqueness
 PRAN’s well-defined field-level network,
and organized input distribution and crop
collection system
 Guarantee of sale
 elimination of the middle men through
creation of ICT enabled agricultural hubs
PRAN’s Vision
To enrich the agriculture sector by
creating more demand for agro
products and enhancing production by
providing training and financial
support to the participating farmers

16. Case Study IX: Sarveshwar Organic
Foods Limited, India
Sarveshwar Organic Foods Ltd. was established in 2004 and is involved in the farming,
processing, and export and marketing activities of organic produce
The company’s extension program focuses on smallholder farmers growing Basmati rice
organically in 157 villages of Jammu, Samba and, Kathua districts of Jammu.
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Publicity
of
Material
Prepare
and
maintain
Field
Diaries
Extension
Activities
Traceability
of produce
Awareness
Generation
Internal
Inspection
External
Inspection
Uniqueness
 purchases rice from the farmers on the premium rates
on buy back basis
 efficient systems of procurement, storage, monitoring
and delivery of produce
 The requirements and obligations of organic production
and contract with the company are explained to the
farmers upfront.
Awareness
Generation
Internal
Inspection
External
Inspection

17. Case Study X: An Giang Plant
Protection Joint Stock Company, Vietnam
An Giang Plant Protection Joint Stock Company (AGPPS) is a provider of seedlings, fertilizers, and
pesticides and a conduit for the transfer of agricultural technologies and cultivation techniques
in the rice industry
To address major agricultural pests and diseases threatening Vietnamese rice producers, AGPPS
selected well-informed farmers to act as ‘farmers’ friends' (FFs) to aid small holder farmers
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Uniqueness
• AGPPS has an extensive distribution network and flexible sales policies
• Offers high quality products, provides advanced technical assistance to
farmers, and has strong marketing campaigns, providing end to end solutions to
farmers

18. Synthesis of Results I: Overview
Involves complete set of actors
Quality of the produce drives private extension
Competitiveness in global markets
Cost of extension is captured by the private sector
Shared value addition – ensures sustainability
Net profit
Natural Resource Management
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19. Synthesis of Results II: Impact of Private
extension
Benefits of
Private Extension
India/
Sugarcane
Kenya/
Vegetables
Brazil/
Vegetables
Nicaragua
/Beans
Nigeria/ Cocoa India/ Onions
Yield increases +++ ++++ ++++ +++++ ++++ ++++
Cost reductions ++++ +++ ++ ++ ++ ++++
Quality and
consistency of
outputs
+++ ++++ ++++ +++ ++++ ++++
Increase in net
profit
+++ ++++ +++ +++ ++++ ++++
Natural
Resources
Benefits
++++ +++ ++++ +++ ++ ++++
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Impact of the private extension system
Note: This is given in the format of “before and after” keeping before at the “++” level

20. Synthesis of Results III: Feedback on the
private extension services
The case studies also provide feedback from the contract farmers themselves, the extension
workers, the communities in which the companies operate, and the company management.
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Crop/Nature of advice India/ Sugarcane Kenya/ Vegetables Brazil/ Vegetables Nicaragua /Beans Nigeria/ Cocoa India/ Onions
Pre-planting advice +++ +++ ++++ +++ ++ ++++
Input supply –
seedlings/ seeds
++++ +++ ++++ +++ ++ ++++
Input supply – fertilizers
and chemicals
++++ ++ ++ ++++ ++++ ++
Help with crop loans ++++ ++ +++ +++ +++ ++++
Irrigation systems ++++ ++ ++ ++ ++ ++++
Intermediate
cultivation / weeding
+++ +++ ++ +++ ++ +++
Harvesting
Help / advice
++ +++ ++++ ++ ++++ +++
Post-harvest advice ++ ++++ ++++ ++ +++ ++
Marketing advice /Help ++ ++++ +++ +++ ++++ ++++
Ranking:
+++++ excellent
++++ very good
+++ good
++ fair
+ poor

21. Conclusions I
Provision of integrated services
Better research-extension linkages
Market connections – assured market access
Reduction in price uncertainty
Inclusive innovation
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22. Conclusions II
Enhanced use of quality inputs
Product differentiation
Solidarity building
Cost recovery
Demand driven
Capacity development
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23. Final Remarks
Access to knowledge is a key determinant of agricultural growth
Private extension plays an important role in the pluralistic extension system
Private extension programs for value chains are effective, but their coverage is limited
Perfect substitute for public extension systems?
Public-private partnerships to increase the efficiency and effectiveness of the public extension
system
Need better understanding of costs and benefits of innovations in extension approaches
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24. Challenges and way forward…
Need to monitor private companies to avoid undue exploitation of farmers
Dispute resolution is another major challenge
What price do farmers pay for extension services?
The scale (and scope) of private companies’ operations may remain limited
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25. 16th December 2015 INTERNATIONAL FOOD POLICY RESEARCH INSTITUTE 25
Thank you!