Impact evaluation of paddy e-procurement program in Bangladesh

Paddy/rice procurement program as a form of price support for the rice producers is widely practiced mechanism in Bangladesh. The purposes of procurement program are providing income supports to the farmers and building stocks for the public food grain distribution system (PFDS). By this process, the government procures rice from domestic markets, stores the procured rice in public warehouse and uses public food stock to intervene in the market for price stabilization (NFNSP, 2020; IFPRI, 2020). The government fixes a procurement price which is higher than the cost of production to incentivize the farmers to sell their crop to the government and also to ensure that farmers get a ‘fair’ price. However, previous studies showed that the service performance of procurement system was unsatisfactory due to a number of shortcomings that impair the program effectiveness. The shortcomings might include service irregularities, high administrative costs, leakage and inefficient implementation or mismanagement etc. Moreover, it has been recognized in the National Food and Nutrition Security Policy (2020) that the operation of public stock procurement and management would be design to minimize the potential distortionary effects on the grain market. Thus, government has launched the mobile phone-based/e-procurement system as a part of the paddy procurement program in 2019/20 Aman season. The main objective of this e-procurement program is to prevent irregularities in the paddy procurement operations for the benefit of the farmers, so that the smaller farmers will get ‘fair price’ of their product. It is expected that an effective paddy e-procurement program will contribute significantly in improving direct participation of targeted farmers, getting benefits from the procurement and consequently a positive impact on their income. In this context, there is a need for rigorously evaluating the program pitted against its objectives.  

Major research questions of this study are the following:

1. Does paddy e-procurement system improve the targeting efficiency of the public procurement program? 

2. Are farmers benefitted from the program?

3. What explains the non-participation in the program?  

4. Is this program cost-effective for the government? 

Study Team: Dr. Taznoore Samina Khanam (Study Director) and Dr. Kazi Iqbal (Adviser)

Duration: August 2021- January 2022