The Agribusiness Regulation and Institutions (AGRI) Index pilot provided an objective basis for assessing the agribusiness environment using a suite of quantitative indicators for topics such as Obtaining Inputs, Accessing Rural Land, and Trading Agricultural Goods. These indicators created a comprehensive framework for benchmarking the agribusiness enabling environment across countries and over time.
The AGRI Index as a concept reflects two fundamental principles: (1) the private sector is the driver of growth in nearly all dynamic agriculture systems, and (2) governments can do more to catalyze agricultural sector growth by improving the regulatory and institutional environment for agribusinesses. Drawing inspiration from the World Bank Group's Doing Business index, the AGRI Index focused on legal, regulatory, and administrative barriers that can be reduced in a relatively short timeframe through discrete policy reforms.
The United States Agency for International Development (USAID) commissioned the Enabling Agricultural Trade (EAT) project to develop and pilot the AGRI Index for three reasons:
- To drive discussion about the agribusiness enabling environment (AgBEE).
- To empower stakeholders in the agricultural sector.
- To develop a consistent and comparable measure of agribusiness regulations.
The AGRI Index Pilot Report contains data and lessons learned in testing in Bangladesh, Kenya, Nepal, Uganda, and Zambia in 2012. AGRI data confirmed the pilot's original premise: agribusinesses face significant and unique legal, regulatory and institutional burdens that impede operations and make compliance a costly proposition. For example, as the chart below shows, agribusinesses in Nepal face lengthy delays in Trading Agricultural Goods.
In Nepal, it takes longer to import seed (56 days) than it does to grow it
- Agribusinesses routinely face burdensome regulatory requirements involving numerous costly procedures and lengthy delays.
- For agribusiness operations, lack of a regulatory framework can be as detrimental as overregulation.
- The agricultural sector often faces intrusive government policies and market interventions.
- Rural agribusinesses have limited access to government offices and services.
- Resource and capacity constraints limit the ability of government institutions to enforce regulations critical to agribusiness start-up and operation.
- Opaque regulations are poorly coordinated across ministries.
- Irregular or unpredictable enforcement can add further delays and costs to compliance.
Click here for the AGRI Index Pilot Report, Annex 1: Data from Pilot Countries, Annex 2: Final Surveys by Topic, and Annex 3: Round 1 & 2 Contributors.