1. Kanat Tilekeyev
Research Fellow
University of Central Asia
Seed and Fertilizers
Policy Development
in Kyrgyz Republic

2. Outline of the Presentation
1. Introduction – Agriculture Profile
2. Recent Government Policies
3. Input Policy Assessment - Seeds & Fertilisers
4. Cases of Recent Government Policies for
Seeds and Fertilizers
5. Empirical evidence of fertilizers using -
Example of Talas farmers

3. Agriculture Profile
Basic Facts & Figures:
o Population – 5.7 mil. people, 2/3 -
rural
o Area – 199 000 km2, 48% -
mountains, 44% - pastures, 7.5% -
agricultural lands (1.1 mil. Ha)
o Agriculture constantly declined in
GDP (34% in 2000, 28% in 2005,
18% in 2011)
o Main crops (2011) by area : grain
(54%), fodder crops (25%),
potatoes, oil seeds, vegetables and
cotton ( all -19%)
Sources: (Abazov, 2008)(National Statistical Office,
2011), (2010 FAO)
o Low grain crop productivity:
wheat – 2.3 ton/Ha, barley – 2
ton/Ha
o Labor employment in
agriculture decreasing (43%-
2003, 34%-2007, 30.7%-2011)

4. Agriculture Profile (continued)
Agriculture Key
Features
o Crop structure
changed since 2000
after land reform
o 90% of agricultural
land – privatazed
o 95% of output in
agriculture – small
scale farmers (83%
of land owners has
< 1 ha)
Crop area dynamics in Kyrgyzstan in 1990-2011, %
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1990 1995 2000 2003 2005 2007 2011
Other crops
Cotton
Vegetables
Potatoes
Forage crops
Other grain
Beans
Corn
Barley
Wheat
o Fertilizers – imported, mainly from
Uzbekistan & Russia (100 thousand
ton in 2004-2011)

5. Agriculture recover
pre-transition level despite
huge complex of unsolved
institutional and
infrastructural problems:
•Low mechanization level,
•Insufficient credit to
farmers,
•Weak extension services,
•Deteriorating irrigation
system
Source: Lerman /FAO 2009
Agriculture Profile (continued)

6. Recent Government Policies & Implications
Kyrgyz Government since Food Crisis period starting in
2008 select intensive policy interventions approach:
Food security Law
 Food Security Monitoring
 Food Reserves & Distribution to Vulnerable Households
 Price and Trade Interventions
 Food Security Council (Ministry of Agriculture – advisory body)
The Agri-Food Processing Corporation- main instrument of
the Government in Food Crisis Interventions:
• Import food to create reserve stocks and stabilize prices,
• Purchase wheat on the domestic market to stimulate own production,
• Export support for haricot beans,
• Investment in agro-processing pilot models (7 factories) – creation
businesses, management and marketing support, providing seed and
fertilizers
Result of interventions in food price stabilization was
ineffective
Source: World Bank 2011

7. 77
Input Policy Assessment - Seeds
Overall goal of specific seed and fertilizer policy is to
increase crop productivity to overpass hunger and poverty
of rural households
Seed Policy: Development of institutional infrastructure and seed
value chain (Legislation and organizations 2000-2009)
Main Result s:
•Legislative base is strong , but unfinished agenda for royalty and
licensing
• Seed producers concentrates on grain or forage crops
•Insufficient financing of agricultural budget
•Ineffective state interventions in Seed Distribution Schemes
(destroying private market development)
•Low adaptability to new crop introduction for seed producers
World Bank, Agricultural Policy Update, 2011)
77

8. 8
Policy Gaps and New Research Agenda
8
8
Input Policy Assessment - Fertilisers
Overall goal of specific seed and fertilizer policy is to
increase crop productivity to overpass hunger and poverty
of rural households
Fertilizer Policy:
1. Monitoring of import of fertilizers – regulatory activity
•Listing, registration and testing of fertilizers, pesticides, herbicides and other chemicals for
plant protection for use in agricultural production,
•Purchasing of the stock of pesticides from state budget for emergency situations (to prevent
and fight with the pests invasions),
•Assessment of the fertilizer availability and declaratory control of firms- suppliers of
fertilizers and other chemicals,
2. Access to Market Liberalizing
•Decrease tax and administrative barriers - no licensing, zero rate on VAT and custom duties
(Custom Tariff Law, 2004); since 2008 VAT exemption for domestic and imported fertilizers.
3. Attempts to protect market from re-export to neighbors
•(Seasonal export duty, Decision of Government, 2012)

9. 999
Policy Gaps and New Research Agenda
9
9
Policy Case 1 – Seed Distribution Scheme
Seed Distribution Scheme aimed to provide access to the farmers by
seeds (grain crops) as subsidized credit from seed producers
State Fund of the Economy Development
(SFED) distributes grain seeds for farmers
annually – 2-3 thousand tons. Total
volume of this support varies from 0.6 to
1.2 million USD. SFED
Farmers
Policy Problems:
1. Program management problem – Aim of the program is
unclear; farmers selection process is not transparent.
2. Farmers often not returned credit in time and fully.
3. Stakeholders interests conflict: Seed prices was
overestimated (2001-2006), Government changes rule
after seeds were distributed (2008-2009 conflict).
4. Local seed producers commercialization incentives are
deteriorated due to Government intervention.
Conclusion:
Scheme need to be
redesigned to increase
policy efficiency.
State Material
Reserve Fund
Seed
producers

10. 1010
Policy Gaps and New Research Agenda
10
10
Policy Case 2 – Export Duty on Fertilizers
Kyrgyz Government in 2012 introduced seasonal export duty (0.3 USD/kg)
for mineral fertilizers from mid-Feb till mid-Aug period to protect domestic
market.
Fertilizers import increased significantly after market
opening in 2004. Import declining in 2009-2010 related
to fertilizers price boom in 2008 and political instability
in Kyrgyzstan in 2010.
Introduction of the export duty doesn’t
support to decrease official re-export of
fertilizers – export of fertilizers increased in
2012. Main country of re-export is Uzbekistan –
89% in 2011 and 99% in 2012.
Conclusion: Government cannot affect on the market directly. Strategy to protect
domestic market need to be re-analyzed
Source: COMTRADE database (http:// http://comtrade.un.org/db/)
(date accessed: Jul. 2013).

11. Example of Analysis of Fertilizers Use
Researchers often faced with the absence of the data for
empirical analysis to assess importance of the input factors and
policy changes. Evidence from the regional case study – Talas
Oblast (Tilekeyev, 2011)
Target Area -Talas Oblast
•Located in north-west of Kyrgyzstan
•92% residents are Kyrgyz
•220 thousand inhabitants
•85% rural residents
•Rural sector dominating - 64% of
regional GDP
11

12. Analysis of Fertilizers Use (continued)
Main cultures:
Haricot beans (56%),
hay(24%), wheat (9%),
potatoes (7%)
Main livestock;
cattle (59% of
HH), sheep
(48%), horses (17%)
Sample:
297 households
Representative on
regional and district
levels
Geographical
randomization
Households Parameters:
Average size of HH – 5.4
pers.
Residents in working age
– 55.4%,
Nationality -92% Kyrgyz
Average age -27.3 years,
88% of HH has a land plot,
Average land plot - 2 ha
per HH
Crop production –
56%, Livestock production
43%, renting land – 0.4%
Agricultural income – 71%
Non-agricultural income-
29%
12

13. Evidence from Talas farmers experience
(Fertilizers –Agricultural Production Relationship)
Analysis of Fertilizers Use (continued)
2,1210 iii FertilizerLandY
Fertilizeri 1 is the categorical
dummy variable, which
shows value of 1 if i-th
household use fertilizers or 0
if not,
- Fertilizeri 2 is the
variable, which shows
amount of use of fertilizers
by i-th household, in
kilogram per ha.
13

14. 1. Agricultural policy decisions often failed due to unclear
decision-making process, absence of the necessary
information.
2. Analysis of the state program effectiveness requires deep
information (currently unavailable) about productivity of
seeds, impact of fertilizers and other inputs on small –
scale farmers.
3. Researchers may overpass the policy gap through
experimental research and survey activity on the farmers
and stakeholders level.
4. Joint work of researchers and Government will improve
policy decision efficiency.
Policy Recommendations
14

15. Thanks for the attention!