The pharmaceutical sector is one of the priorities in the economic policies of Bangladesh. There are more than 200 small, medium and large companies producing around 97% of the total domestic demand. 80% of the production is generic drugs and the rest, 20%, is patented drugs. The country enjoys competitive advantages, including lower labour costs.
In rural areas, but increasingly also in urban areas, herbal treatments are becoming popular. Medicinal herbs are traditionally rooted in Bangladesh and they are still an essential part of public healthcare. People consume indigenous medicines such as alternative (Ayurvedic) and herbal medicine. This type of medicine also tends to be lower in price than Allopathic (drugs, radiation or surgery) treatments.
Beyond consuming herbal medicines, what does a booming pharmaceutical sector in Bangladesh mean to the livelihoods of poor and disadvantaged communities? In this blog post, we show how an initiative continually strived to leverage the actions of key players in the medicinal herbs sector to bring about benefits to poor and disadvantaged communities. Such an effort avoided following checklists or formulae but was built on flexibility and creativity.
It all starts with the production of sufficient, quality herbs
Companies like ACME and SQUARE, which are the leading manufactures of medicinal products in Bangladesh, are interested to outsource medicinal herbs from domestic producers. This cuts their costs of importing raw materials from abroad. However, there are two major problems. First, production does not meet their demand. Second, the quality of materials produced is low which is often rejected by the companies. These problems discouraged the companies from travelling all the way from Dhaka, the capital, to other parts of Bangladesh.
There were few rich farmers who grew a limited number of medicinal herb species sold to local traders (paiker). Traditional herbal medicine dealers (Kobiraj) dominated the trade of medicinal herbs. These actors met some of the local demands, but the quality of their products was poor as they were often mixed with other health risk materials.
Most rural communities knew that medicinal herbs could bring them a better income. The problem was many of them either did not have land, or they owned land not enough and suitable (not contaminated by chemical fertilisers) for producing medicinal herbs. Bangladesh is one of the world’s most densely populated countries, with its people crammed into a delta of rivers that empties into the Bay of Bengal and floodplains swept by cyclones. Land scarcity is acute and many poor and disadvantaged women and men are landless.
But governance of roadside and fallow land prevents better access and use
Market systems are not just about producing and selling products. They are also concerned about supporting functions like training or coordination, as well as rules and regulations including informal values and norms. Roadside and public fallow land belong to a land category locally known as khas land. It is owned by the state. The government leases or gives away to people who do not own or have access to land. Although available size is not fully known (due to lack of official accurate inventory and consequent loss of a substantial amount of land), most khas land remains unused.
An analysis done by the Samriddhi project, that facilitated this initiative, showed that settlement and allocation of land is often highly disputed and insecure. Corruption, grabbing by local elites and powerful/politically connected people, questions of transparency on the application process and weak voice of the poor are some of the main problems.
What is the way out? Addressing underperforming advocacy capacity
When investigated further by the Samriddh project staff, it became clear that rural communities lacked the knowledge and confidence to approach local officials and negotiate the leasing of land. Rural communities were asked who could do this, and they quickly pointed out that they knew local service providers working in other products (like fruits) who potentially could support them.
The project staff followed this hint and opened discussions with the associations of local service providers. The associations liked the idea. However, some members were reluctant. They were not sure about the benefits of advocating on behalf of poor and disadvantaged rural communities. They asked that the project should pay their services. Other members suggested that they could offer embedded services from which they would benefit by collecting medicinal herbs from rural communities and supplying it to pharmaceutical companies. They also indicated that their registration by government agencies could help them approach local elected officials.
A more serious challenge was the service providers’ lack of negotiation skills to approach and convince local officials by making the case for access to land for medicinal herb production. This was the root cause that staff of the project wanted to facilitate.
Additional discussions with the Medicinal Plants and Herbal Products Business Promotion Council under the supervision of Ministry of Commerce revealed that the service providers needed technical skills (e.g. collection, storage and drying) to meet the high-quality demands of pharmaceutical companies. Experts of the Council did not promote medicinal herbs among the local communities even though this was their mandate. According to them, their staff could not provide training due to limited time. Yet they were not aware of several interested local service providers in the area who could be trained by few of the Department’s staff together with experts from the pharmaceutical companies.
After series of discussions, local government officials showed interest to support the initiative. They realised that this was a good way of fulfilling their mandates and securing local support base. In addition, the Business Promotion Council was ready to support the governance structure of the sector involving rural communities, private companies and local service providers. Transactions in medicinal herbs are governed by standards and clear formal agreements even though trust is also one important aspect.
Highly needed momentum to the initiative came from private companies that agreed to co-finance the training of local service providers and the establishment of collection centres in rural villages – for aggregating, drying and doing primary processing by producers. The response in terms of production was so encouraging that private companies have increased and expanded financing collection centres in more areas (while the project no longer provided any inputs). The collection centres also produced good, unexpected results. For example, the collection centres were located close to the houses of women producers, which addressed their mobility problem in rural areas of Bangladesh (e.g. to go to markets). This enabled more and more women to sell their produce at the collection centres and directly receive payments.
Beyond “islands of success”: how about other poor and disadvantaged communities?
The initiative sought to address poverty in the northern part of Bangladesh. By the end of 2015, there were about 60,000 producers growing medicinal herbs on roadside and fallow land. Most of the producers were poor and disadvantaged women.
Additional private companies and small enterprises joined producing and processing medicinal herbs, expanding their geographical coverage beyond the initial northern part of Bangladesh. Better horizontal and vertical coordination of actors led to product upgrading (increasing the qualities of products and value) and process upgrading (enhanced efficiency of production either through better organisation of the production process or the use of improved technology). Poor and disadvantaged women and men diversified the species of medicinal herbs. They started growing basak (vasaka adhatoda zeylanica) and then added four species: kalomegh (andrographis paniculate), holy basil (tulsi), asparagus (shata muli) and withania somnifiera (ashwaghanda).
International and national actors and players – from development agencies to international organisations – have started replicating the success of the initiative. Because of such broader and deeper impacts, the International Land Coalition has recognised the initiative to address the problem. The Second Herbal World Global Exhibition and Conference held in Malaysia in September 2014, which brought together 56 pharmaceutical companies, conferred Helvetas Swiss Intercooperation, the implementer of the Samriddhi project, an award for its innovative work.
It has been three years since the project ended. We believe that it is important to do a follow-up investigation to see whether the impacts have continued (sustainability) at which extent (scale). This potentially contributes to building evidence on ex-post evaluation of development projects.