Four fundamentals
In one of the research papers, Ashok Gulati, Nick Minot, Chris Dlegado and Swasti Bora examine the causes and consequences of a shift towards high value agricultural products. In their search for vertical links with farmers of the growth of such products, the authors mainly focus on eight Asian countries: Bangladesh, India, Pakistan, Indonesia, the Philippines, Thailand, Vietnam and China. The first premise of the paper is that unlike green revolution that was driven by technology (higher-yielding varieties), the current transformation is caused by changes in food consumption pattern. Mainly four factors affected the change. Rapid economic growth in many Asian countries allowed consumers to shift from grains and other starchy staples to higher value foods such as fruits, vegetables, eggs, dairy products, and fish.

Second, urbanisation accentuated the change by affecting lifestyles, increasing exposure to media, and expanding availability of such goods. Third, changes in trade regimes --from inward to outward looking -- also affected production and consumption patterns in two ways: by creating new export opportunities for production and influencing consumption patterns with increasing access to imported foods. And finally, food marketing channels have also been affected by a relatively liberal FDI policy. Initially FDI flew to food processing and recently to retail food sector. The authors notice that while per capita grain consumption was either falling or growing at less than one per cent per year in all eight countries under consideration, per capita consumption of HVA crops was generally growing at 2-10 per cent per year, depending on the country and the commodity.

Superior 'supers'
The trends outlined above tell about the food marketing system in Asia. First, income growth, urbanisation, and the deregulation of FDI have attracted supermarkets and other types of food retailers. Barring Bangladesh where supermarkets are mostly local and at a nascent stage, some Asian countries witnessed FDI in food sector. In Thailand and the Philippines, more than half of food is sold through supermarkets. According to the authors, the share is only 5 per cent in Bangladesh and Vietnam. But my own research (and for IFPRI) shows that of the total agricultural crops in retail chain in Dhaka city, 10-15 per cent pass through supermarkets.

Second, FDI and growing demand for processed foods have increased the overall size of the processing sector as well as the scale of operations of individual plants. In Bangladesh, few local companies like PRAN are engaged in processing and FDI yet. Anyway, processed food exports have gone up and fast than the overall agricultural exports despite a range of tariff and non-tariff barriers. Third, innovative institutional arrangements cropped up to embrace the induced changes. For example, in many countries including Bangladesh, contract growing is in evidence and particularly in Bangladesh, some NGOs stepped into the production and marketing of HVA crops, especially to tie up the tiny tillers vertically.

Will the small survive in the transition? Well, that depends on: (a) infrastructural development that connects them with markets and urban centres, and (b) institutions that link them to HVA marketing channel. Allow me to elaborate the points on the basis of my research observations. Chandina is well connected with Dhaka city. And Chandina is also a place where BRAC -- a renowned NGO -- targets small farmers with inputs to grow vegetables. Chandina farmers are now growing French beans only for export. Chandina farmers are also experiencing a lot of exporters coming to buy their crops. As high as 30 per cent of the household income of the poor farmers in Chandina come from sales of vegetable only! It is thus not only infrastructure but also institution that matter.

Information and innovation
Drawing upon Indian experience, the authors are of the view that the role of information and communication technology is important for the growth of HVA crops. "Lack of complete and timely information about production and post harvest technologies, markets, prices, and export potential is a major factor often cited as a limitation in promoting agricultural diversification and accelerating growth in the production of high value crops". The most successful example is an initiative by the Indian tobacco Company (ITC) for promoting soyabean production and marketing. In Bangladesh, a farmer from Thakurgaon rings a wholesaler in Chittagong to know about the prices of the perishable products. Once convinced about profitability, he catches the bus at 6 am and reaches Chittagong at 7 pm with all his vegetables. The perishable products become prizeworthy in the face of facilities.

Policy points
Quite obviously, the mindset has to be changed to help small farmers in the crucial context so that they can smell good. First and foremost, develop risk mitigating strategies that would protect small holders from various production and marketing risks. Second, develop a mechanism whereby small holders would have access to financial capital. Mind that production and marketing of HVA crops is capital intensive. Third, change the existing laws and regulations pertaining to agricultural production and marketing. That may imply attracting FDI in the retail sector for technology. Fourth, develop infrastructure -- electricity, roads, and telecommunications. And finally, search for innovative institutional arrangements for HVA crops. In short, the time has come for HVA crops and policies should soon follow suit.

Abdul Bayes is a Professor of Economics at Jahangirnagar University.