AG R I C U LT U R E & RURAL DEVELOPMENT JOINTNOTES ISSUE 63 JUNE 2012 Lessons from Scaling Up 69832 Reducing Postharvest Loss Through Mini Cold Storage Technology – Lessons from India The new “Lessons from Practice: Assessing Scalability� report aims to provide specific tools and guidance to World Bank Task Team Leaders (TTLs) and other agricultural development specialists which can assist them in identifying the potential for scaling up small, innovative projects throughout the entire project cycle – from inception through completion. The report, developed in collaboration with the Heller School for Social Policy and Management at Brandeis University, draws on lessons from the experience of the Development Marketplace (DM) in funding small innovation projects and offers strategic advice to agricultural practitioners on assessing the scalability of such projects. This Note is based on a case study from India from the report. Scaling up effective agricultural development this project introduced MCSUs which are specifically projects is a necessary component in the fight to designed for the needs of smallholder farmers. The reduce global poverty. In order to help facilitate service delivery method is a form of public private efficient and effective scaling up initiatives, however, ownership wherein the state government and a it is necessary to first identify key lessons and nonprofit organization at the regional technical recommendations which can offer streamlined college collaborated to support the emergence of guidance in this process. As part of a continued youth entrepreneurs who can sustainably operate effort to develop effective guidance on scaling up the cold storage unites and deliver services to small ARD conducted a case study of the “Waste to farmers in the different markets. Wealth by Incubating Mini Cold Storage Technology Ventures� project in India in order to extract THEORY OF CHANGE (TOC) elements from this innovative project which could Prioritizing a simple and effective Theory of Change offer broader lessons and recommendations on (TOC) is a key recommendation highlighted in the scaling up in general. This case study – developed Lessons for Scaling up Report. Informing this in collaboration with Brandeis University – explored recommendation is the TOC employed during this lessons and recommendations from this joint World project, which emphasized the idea that a key Bank Development Marketplace – Tiruchirappalli technological innovation, coupled with a novel service Regional Engineering College/Science and delivery method, will have sufficient net benefits Technology Entrepreneurs Park (TREC-STEP) project, to engage farmers, government and trained rural which sought to substantially reduce post-harvest entrepreneurs to run the venture and transform it vegetable waste and to increase farmer incomes by enabling small farmer access to Mini Cold Storage Units (MCSUs) specifically designed to meet the needs of small famers. Postharvest loss is a critical issue being addressed by agricultural interventions across the globe. Although Cold Storage Units currently exist around India, these units tend to be too cost prohibitive and physically inaccessible for the vast majority of smallholder farmers. As a result of this situation, it is estimated that value loss due to lack of cold storage for small farmers is around 20 to 40% of produce value – translating to between $300,000 - $400,000 annually for the five markets targeted by Mini cold storage unit at a farmers’ market in India the project. In response to this development gap, Photo: ARD into a viable, sustainable business. At the heart of this TOC was a market level intervention with the dual purpose of Project Benefits (1) improving farmers’ incomes and engagement in market • Increase in small farmer income ranging from 9% to activities and (2) addressing the broader national issue 31% due to decreases in postharvest loss of food security through the reduction in food wastage • Reductions in costs of transport due to ability to store of between 25-40% every day – an estimated collective vegetables at market from one day to the next savings of $6 billion across the country on an annual basis. • Increases in overall vegetables arriving at markets LESSONS FOR SCALING UP • 56% of the users of the MCSUs are currently women Critical to the success and sustainability of this project, farmers and additional key lessons for scaling up illuminated by this project, is the need for local legitimacy and ownership, coupled with financial viability. The losses, build political good will and lead a social initiative provision of cold storage is an important element in that has the potential to be scaled up on a national level. helping farmers derive more benefit in the supply chain Furthermore, training and employment opportunities in India, but the successful sustainability of this project developed by this program created incentives for rural relies on the overall buy-in among both smallholder youth to engage in the project – resulting in both reduced farmers (who can benefit from increased involvement unemployment and increased capacity for at-risk youth. in market activities) and the government (which plays a substantial role in helping these farmers increase their CONCLUSION production and incomes through the provision of access The “Waste to Wealth by Incubating Mini Cold Storage to stalls in the market, transportation to the market, price Technology Ventures� project in India was an innovative regulation and appropriate advice and extension services). intervention which provided economic incentives for The success of this project – showcased by increases in increased engagement in market activities among rural farmer participation in market activities and decreases smallholder farmers while simultaneously addressing the in postharvest losses – has created local legitimacy and ongoing development challenge of postharvest loss. By ownership. However, in order to build on this success, introducing a strategic and simple Theory of Change which the financial viability must also be validated through targeted these components, this project was able to bring the continued engagement of the government in this together a variety of beneficiaries along the value chain intervention. and create appropriate incentives to ensure both economic and social benefits within the project. Furthermore, by One additional lesson which also incorporates the highlighting the important role this simple TOC can play multiple stakeholders benefitting from this innovation in ensuring success when coupled with appropriate is the need to provide appropriate incentives for incentives – through the creation of local buy-in and engagement. This project was very effective in creating ownership among beneficiaries – this project provided appropriate incentives along the value chain. Smallholder essential lessons and recommendations which can benefit farmers were provided with MCSUs – improving the the scaling up agenda as a whole. quality of produce while simultaneously reducing transportation costs and other burdens. The local governments were also incentivized by this project This ARD Note was prepared by John Mackedon, Gunnar Larson, and Kaisa Antikainen under the guidance of Fionna Douglas, with special through the opportunities to support small farmers, thanks to Susan Holcombe and her team at Brandeis University. create food security through reductions in postharvest 1818 H Street. NW Washington, DC 20433 www.worldbank.org/ard