4.0pc agri growth rate required to halve poverty by 2015: WDR

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FE Report
Bangladesh needs to record a growth rate of at least 4.0 per cent in agriculture a year if the country wants to achieve the objective of halving its extreme poverty by 2015, says a new World Bank report.
"Achieving the Millennium Development Goal (MDG) of halving poverty to 26.5 per cent by 2015 will require a growth rate of at least 4.0 per cent in agriculture and 7.0 per cent in the non-farm sector," the latest World Development Report (WDR) released Friday in Washington, observes.
To realise the goal, the report titled 'Agriculture for Development' has called for greater investment in agriculture in developing countries and warns that the sector must be placed at the centre of the development agenda if "the goals of halving extreme poverty and hunger by 2015 are to be realised."
The report says the agricultural and rural sectors have suffered from "neglect and underinvestment over the past 20 years."
It also insists that agriculture can offer pathways out of poverty if efforts are made to increase productivity in the staple foods sector.
For its part, the global development lender intends to scale up its support for agriculture and rural development, following a decline in lending in the 1980s and 1990s.
"Commitments in the fiscal 2007 reached $3.1 billion, marking an increase for the fourth straight year," the report pointed out.
The report has noted that poverty in Bangladesh is primarily a 'rural phenomenon', with 53 per cent of its rural populace classified as poor, comprising about 85 per cent of the country's poor.
While 75 per cent of the world's poor live in rural areas, a mere 4.0 per cent of official development assistance goes to agriculture in developing countries, according to the report.
The report said: "Growth will need to come from intensification of cereal production, diversification into high-value crop and non-crop activities, and value addition in the agro-processing sector."
"This will require reforming the agricultural research and extension systems, and financial and other regulations. Land administration and security issues also need to be addressed," the report added.
For nearly 45 per cent of the rural population and a majority of the new labour force every year, a declining land base and a small urban employment means that employment in the rural non-farm sector presents the best chance to escape poverty, according to the WDR.
The rural non-farm sector's growth, however, is constrained by lack of or poor quality of rural infrastructure and services, highly centralised government framework, weak rural financial systems, and a poor law and order situation, says the report.
The report has noted that both public and private investments in agricultural research and extension system are essential for "the transition from subsistence to commercial farming" through diversification, export promotion, and bridging yield gaps.
Pointing out that land is becoming "a scarce commodity" in Bangladesh, the World Bank report said there is a need to review land administration, ownership distribution, rights and titles, and land use policy.
Referring to rural finance, the report has stressed on understanding the constraints to access to rural finance, particularly by the "missing middle" farmers as well as small enterprises. "There is also a need to reform 'agricultural banks', to improve their recovery rate, reduce defaults, and increase the number of commercial bank branches in the rural areas."
Turning to the rural service delivery, it said improving physical and social infrastructure - roads, electricity, communication, water and sanitation, health and education - in rural areas is fundamental both for promoting employment opportunities and welfare.
"… Bangladesh has a long way to go to meet infrastructure needs, such as electricity, which is only available to 15 per cent of villages," the report said.
"A dynamic 'agriculture for development' agenda can benefit the estimated 900 million rural people in the developing world who live on less than $1.0 a day, most of whom are engaged in agriculture," said Robert B Zoellick, the bank's president.
"We need to give agriculture more prominence across the board. At the global level, countries must deliver on vital reforms such as cutting distorting subsidies and opening markets, while civil society groups, especially farmer organisations, need more say in setting the agricultural agenda," Zoellick said while commenting on the report.