India: Assam agricultural competitiveness project

November 1, 2011

World Bank

Community Procurement of Pump Sets and Using SMS for Communication

Although Assam has an abundance of rainfall in the monsoon season and the land is fertile, farmers are unable to maximize the income from their fields because they lack access to water during the long dry winter months. This is largely because they lack the capital to invest in shallow tube wells to tap into the region’s high water table and abundant groundwater.

To enable farmers to irrigate their fields in winter, the World Bank-supported Assam Agricultural Competitiveness Project sought to provide groups of 3-5 small and marginal farmers with irrigation pumps for shallow tube wells. At first, the project focused on the centralized procurement of these pumps to ensure that a large number of pumps were quickly delivered to farmers across the state at low costs.

This, however, proved to be difficult. With Assam being a northeastern state, few qualified manufacturers were willing to bid. Moreover, to ensure that the pumps were of good quality, only manufacturers who had the requisite turnover and capacity were allowed to bid, reducing the number of bidders even further. In the end, while the pumps procured were cheap, the farmers were unfamiliar with the brands on offer and the uptake of pumps was slow. The project then devised an innovative process of community procurement that allowed farmer groups to choose the pump sets themselves from a pre-selected databank. The databank was drawn up through a state selection process and listed each pump set on offer with its corresponding rate. With manufacturers of varying capacities being allowed to apply, the pump sets on offer included a choice of 25 models and 13 suppliers. Since suppliers were assured of bulk orders, they were able to offer the low prices typically associated with centralized procurement. An audit process was also devised to verify that the pumps were delivered and installed with the farmers for whom they were intended.

The community procurement process has led to a significant increase in the uptake of pumps by farmer groups. The cost of the pump sets is not only lower, farmers also receive better after-sales service because the pumps are delivered by local dealers. Based upon the success of this project, the state’s Department of Agriculture has mainstreamed the process of community procurement into their
regular operations.

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