The Finance for Enterprise Development
and Employment Creation Project (FEDEC) has been working since 2007 to
contribute to economic growth and poverty reduction in Bangladesh. Thereby it
focussed on providing microfinance services to micro-entrepreneurs and value
chain development services to improve access to markets and build the capacity
of small businesses.
During the recent supervision mission, we have met with
project staff, NGOs and beneficiaries and have seen many good examples for
value chain development in Bangladesh. And while certainly all of them deserve
to be shared, below are two examples: Cow rearing and prawn cultivation (the
latter project has already successfully been replicated by a different NGO in
another region and setting!):
Cow rearing value chain development
With the support of FEDEC, GRAMAUS has started the cow
rearing value chain development project in March 2012. Currently about 300
households are participating in two upazillas (Mymensingh and Fulbaria). The
project aims at tackling the insufficient level of knowledge and skills
regarding cow rearing, raising awareness and practice of artificial
insemination and increasing the low selling price of milk at the farmers’ end.
As a result, GRAMAUS has developed a project that supports a complete value
chain:
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| Farmers at milk collection point |
1. Cow rearing/milk production
GRAMAUS has put in place a veterinary service that offers
vaccinations, testing and artificial insemination for cattle. The project’s
veterinary visits up to 30 farmers every day and is furthermore available over
his cell phone for any questions or concerns the farmers might have. Currently,
vaccination and testing is free of charge for the farmers as they are covered
by the project. After two years –when the project is completed – GRAMAUS plans
to charge a minimum fee to cover their expenses and ensure the sustainability
of their intervention, explains Md Abdul Khaleque, Executive Director at
GRAMAUS.
In trainings, farmers (husband and wife) learn how to
diagnose diseases and to track the medical treatment of their cattle in a
booklet provided by the project. Furthermore, the farmers are now also keeping
record of costs and benefits. Other elements of the training included
improvement measurements for cowshed and fodder. Already, these measures have
improved cattle health and increased the milk production on an average of two
litres of milk per cow.
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| The milk collection team |
Due to the lack of a milk processing plant, farmers had to
sell their milk on the market at an unstable and often very low price. In
addition, they had to travel several kilometres every day to the market which
meant valuable time away from their farm.
The project established a milk collection service. At
several milk collection points, a milk collector now buys the milk from the
farmers at a guaranteed price of BDT 38 per litre (market price fluctuates
between BDT 20 and 45).
3. Milk processing
In the afternoon, the milk is transported to a local cheese
factory that sells its cream cheese to stores in Dhaka. Earlier, the owner
solely bought his milk from a collection point 200 km away, as there was no
local collection. According to GRAMAUS, the owner is interested in buying more
milk locally and plans to extend his enterprise – taking a ME loan from
GRAMAUS.
In Comilla, farmers have been cultivating fish in their
floodplains for several years now. But
cleaning out the plains in November/December in order to prepare for paddy
cultivation in the next season came with a low price due to oversupply to the
market, resulting in very little profit for the farmers. Two years ago, the
Centre for Community Development Assistance (CCDA), therefore started to
introduced fresh water prawns as a new species to be grown together with
traditional fish species. The advantage of prawns is that, while being a high
value product, they come with very little production costs. In fact, farmers
only have to cover the costs for the juvenile as seeds. Additional fodder for
the prawns is not necessary.
Prawn cultivation in floodplains
In the beginning, it was difficult to convince the farmers.
Starting with an original set of 20 farmers, CCDA trained a total of 160
farmers on mixed fish-prawn cultivation, on water treatment, selected farmers
to establish and run nurseries and established
demonstration ponds over a period of two years. At the end of this first
phase, the farmers had harvested a total of 15,000 kg prawns, in addition to
the traditional fish species, resulting in a net profit of Taka 7.5 million for
the farmers, about BDT 47000 per farmer.
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| Prawn harvesting in Comilla |
By generating jobs, for example in the fishing, nursery and
marketing actvities, prawn cultivation also benefits households without any
land in flood plains. Since the farmers now control and treat the water quality
and stopped using pesticides, the production of traditional fish species went
up as well, improving nutrition of the local community. Given the successful
test-phase, CCDA decided to scale-up the project in a second phase. The project
will now be implemented in two districts (Comilla and Brahmanbaria), involving
about 400 beneficiaries.
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| Hatchery construction site |
After seeing the profit made, farmers are very interested in
prawn cultivation. So interested that the demand for post larvae (PL)/juveniles
could not be met, told M. A. Samad, Executive Director of CCDA. Up until today,
the PL had to be bought from a hatchery 300km away. In addition to the high
mortality rate during transport, the supply was limited. This is, why CCDA,
with the support of PKSF, has started to build its own hatchery in Daudkandi,
Comilla, that it will run as a social entreprise. “With this hatchery, we will
be able to provide our project participants with 4 million PL per year”, said
Mr Samad. “We are also establishing 40 additional nurseries in both districts.
The hatchery will enable us to not only provide our participants with better
PL, but also at a lower price.”