Agriculture under pressure: The Bangladesh chapter

Since its birth, agriculture has always been the foundation of Bangladesh's economy without any doubt. It plays a major role in GDP by making a direct contribution of approximately 11-13% annually by engaging around 45% of the population.

Agriculture sector is the ultimate backbone of the economy as it ensures food security and economic stability.

The major staple crops include rice, wheat, jute, and vegetables, which, after meeting domestic demands, also ensure export earnings. Apart from the major staples, agricultural items like tea, fish, and seasonal fruits are also a major source of export earnings, which is instrumental in economic diversification. Eventually, it strengthens the country's economy by improving rural income and reducing poverty.

Over the years, small-scale micro farmers have made an immense contribution to the growth of agricultural production in the rural areas, which has fed millions of people and also supported their livelihood. Nevertheless, factors like climate vulnerability, poor logistics, inadequate resources, insufficient infrastructure, poor access to finance, limited access to inputs, and lean access to market have always been drawbacks for ensuring maximum productivity.

Considering the scenario to attain sustainable growth, the government and the private sector can make investments while ensuring climate-resilient practices. 

Bangladesh is experiencing growing climate-related disruptions, including more frequent droughts, floods, and storms, all of which are negatively impacting crop yields and degrading soil fertility. Climate models indicate that these challenges are likely to worsen, highlighting the urgent need for adaptation and resilience strategies within the agricultural sector.

Adverse effects of weather can be seen harshly affecting the southern part of Bangladesh. Barisal, once renowned as the granary of Bangladesh, is now falling behind in rice production caused by recurring cyclones and rising soil salinity due to sea-level rise. Rice yields per hectare in Barisal are lower than those in Mymensingh, Rangpur or Dinajpur. Additionally, recent surges in vegetable prices, especially potatoes, have also been linked to unpredictable weather patterns.

Most farmers in Bangladesh are micro farmers as they have very small plots of land by global standards. In addition, the persistent land aisle problem, which essentially refers to issues surrounding land ownership, access and management, is a complex challenge with significant social, economic and environmental implications.

A recent report shows that these small farmers make up 83% of the farming community and grow crops on about half of the country's usable farmland. However, land is becoming harder to access, with more than 50% of rural families owning no land at all. To make things worse, the amount of farmland in Bangladesh is shrinking by about 0.3% each year, making it harder to grow enough food for everyone.

Cuts to subsidies in the national budget have made it harder for farmers to afford vital resources like fertilisers and seeds. Despite some recent increases in the budget, the current subsidy allocations remain inadequate to cover the growing production costs, placing significant strain on farmers and reducing the competitiveness of Bangladesh's agriculture sector. Moreover, farmers also rely on subsidies for fuel, as the majority of irrigation pumps in the country run on diesel or electricity.

Over time, rice production in Bangladesh has shifted, with Boro rice now playing a dominant role in the dry winter season, while the wet, rainy season has seen a decline in importance. Boro rice accounts for more than half of the total rice production, with Aman rice making up most of the remainder and Aush rice contributing only a small share. This shift can largely be attributed to the effects of climate change. Erratic rainfall, floods, and cyclones regularly damage significant portions of the Aush and Aman crops.

In contrast, Boro rice, grown during the dry season, is less affected by such climatic disruptions. To ensure the continued sustainability of Boro rice production, it is essential to provide farmers with reliable irrigation systems, as Boro rice requires consistent irrigation and cannot thrive on rainfall alone. Additionally, the government must ensure a stable electricity supply to support the irrigation needs of Boro rice fields.

Bangladesh's agricultural sector continues to face critical constraints, primarily due to inadequate storage infrastructure and a fragmented supply chain, which contribute to significant post-harvest losses. Weak transportation networks further restrict farmers' access to major markets, limiting their ability to secure better prices and reduce waste. A wide disparity persists between farmgate prices and retail prices, often driven by market inefficiencies and the influence of syndicates, as highlighted in recent research on the country's agrifood system.

To address these challenges, policymakers must develop targeted interventions that improve market access, strengthen infrastructure, and ensure fair pricing mechanisms — benefiting both producers and consumers amid ongoing food price inflation.

Urban growth is reducing arable land and increasing competition over land use. At the same time, rural-to-urban migration is shrinking the agricultural workforce, threatening food production as demand rises. While the western region of Bangladesh has surplus farm labour, the eastern districts face shortages. This imbalance leads to lower wages for workers in the western districts due to supply and demand. To fix this, efforts are needed to improve labour mobility and close the wage gap between regions.

Bangladeshi farm products face strong competition from nearby countries like India and Vietnam. These countries can sell at lower prices and offer better quality because they have better technology and infrastructure. Jackfruit products, which are now widely available in Bangladesh, could be a good chance for export. To do well in foreign markets, it's important to keep the products safe and high in quality. The Bangladesh Standards and Testing Institution (BSTI) can help make sure of that.

Tackling the current challenges in Bangladesh's agriculture sector requires greater investment in infrastructure, broader access to financial services for farmers, and a well-planned strategy for climate resilience. One of the most pressing needs is the development of modern storage facilities nationwide, which will demand significant funding.

A Public-Private Partnership (PPP) model offers a promising path forward, enabling collaboration between the government and private sector — particularly in areas like technological innovation and logistics. Such partnerships can drive modernisation, improve productivity, and enhance sustainability in agriculture.

Additionally, increased investment in research and the development of high-yield crop varieties is crucial for long-term growth. While the Bangladesh government continues to provide substantial subsidies to support farmers, these programmes should be regularly evaluated to ensure they are both efficient and effective.

Irfan Islam. Photo: Courtesy

Irfan Islam is the Banking and Financial Sector Advisor at iFarmer

Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions and views of The Business Standard.