Fertilizer distribution improvement II

The project, to be implemented by the Ministry of Agriculture, will encourage the development of large-scale private sector fertilizer wholesalers, increase marketing and distribution efficiency, and support dealer development/sales promotion efforts. The project will carry the New Marketing System begun under project 3880024 one step further by encouraging the development of large-scale private sector wholesalers who will be allowed to sell fertilizers anywhere in the country at any price. To this end, the Bangladesh Agricultural Development Corporation (BADC), a government unit, will - for the first time - sell large volumes of fertilizer at discounted prices directly from factories, ports, and depots. Ultimately, a fertilizer distribution system which is either dominated by the private sector or mixed public-private will emerge. To ensure that fertilizer wholesalers and retailers of all sizes have the working capital they will require, a refinancing program will be begun to provide short-term (3-month) credit at interest rates comparable to those for agricultural credit. (If the need arises, funds from this component may be used for fertilizer imports.) Also, infrastructural improvements needed to increase wholesalers" physical access to BADC sales outlets will be financed. Improvements - e.g., upgrading roads and barge wharfs and widening factory doors and railway underpasses - will be chosen following an assessment of physical constraints on fertilizer distribution, to be conducted 1 year after large-scale distributors have begun operations. The project will also support continuation of the BADC"s Dealer Development and Training Program, aimed at increasing retailers" technical fertilizer knowledge and hence ability to advise farmers. All 21,000 fertilizer dealers will attend semiannual 2-day courses. Fertilizer demonstration plots will be set up to assist in the training. Three resident advisors will monitor fertilizer distribution and marketing, offer advisory services, help produce and distribute promotional materials, and provide training and equipment. Also, TA and training may be provided to the recently formed National Fertilizer Distributors" Association (NFDA).