Poor Planning and Management Hamper Effectiveness of AID's Program To Increase Fertilizer Use in Bangladesh

ID-81-26: Published: Mar 31, 1981. Publicly Released: Apr 7, 1981.

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The Agency for International Development (AID) has undertaken a project to improve the supply and distribution of fertilizer in Bangladesh. The aim of the project is to help Bangladesh meet its goal of achieving foodgrain self-sufficiency by 1985. GAO reviewed project planning and implementation.

Some progress has been made to improve fertilizer distribution and use, but the project has not achieved its goal of an annual 15-percent increase in fertilizer sales. Fertilizer imports have not been adequately planned and coordinated with domestic fertilizer production and storage capacity. The project's new marketing system has made limited progress in improving farmer access and reducing distribution costs. Construction of storage facilities is significantly behind schedule, and those warehouses which have been built are fewer and smaller than planned. Plans to provide bulk-handling facilities have not been adequately planned. Plans by AID to purchase portable bagging machines for bulk fertilizer imports may duplicate similar efforts planned by another agency. Current fertilizer imports are not sufficient to justify the machines.

Recommendations for Executive Action

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Administrator, AID, should act to establish procedures and requirements calling for collaborative project efforts among the contractor, the host government, and the AID mission and providing a mechanism to speed the approval process, resolving differences as they occur.

    Agency Affected: United States Agency for International Development

  2. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Administrator, AID, should act to coordinate and integrate current AID plans for providing temporary bagging machines with similar efforts of the International Fund for Agricultural Development, including securing appropriate commitments from the host government and other donors for effective equipment use.

    Agency Affected: United States Agency for International Development

  3. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Administrator, AID, should encourage and assist the Government of Bangladesh to: (1) systematically collect information on dealer functions and coverage under the new marketing system and use this data to help make necessary changes to ensure that farmers have equal access to available fertilizer when needed; (2) determine how the dealer discount policy should be revised or modified to more accurately reflect actual project and overhead costs to dealers and to allow a reasonable profit; and (3) gradually remove officially administered retail sales prices, as long as doing so would not reduce the equal access of fertilizers to all farmers.

    Agency Affected: United States Agency for International Development

  4. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Administrator, AID, should assist and encourage the Government of Bangladesh to: (1) employ a more systematic approach for planning imports, one that gives proper weight to factors of fertilizer supply and demand in a way that is responsive to changing conditions; (2) pursue a diammonium phosphate (DAP) marketing strategy to include more widespread and consistent informational promotion, on-farm experiments to demonstrate the advantages of using DAP, and consideration of price incentives to purchase and use DAP; and (3) develop reliable, nationwide data on the most effective types, proportions, and combinations of fertilizer to use on the main crops grown in Bangladesh.

    Agency Affected: United States Agency for International Development

 

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