Chapter 12

The “Quiet Revolution” in the  
Aquaculture Value Chain in Bangladesh1

Ricardo Hernandez, Ben Belton, Thomas Reardon,  
Chaoran Hu, Xiaobo Zhang, and Akhter Ahmed

12.1 Introduction
There are two strands in the socioeconomic literature on aquaculture. The 
first, which we call “micro socioeconomics,” is work centered on the role of 
farm households as fish producers, and the impacts of aquaculture on rural 
communities where aquaculture takes place. This strand can be divided 
into three themes: (i) farm technology diffusion and efficiency (e.g., Dey et 
al. 2005; Rauniyar 1998); (ii) farm interactions with the environment (e.g., 
Islam 2014; Primavera 2006); (iii) livelihoods. The latter can be divided 
further into studies linking aquaculture to poverty reduction and studies of 
impacts of aquaculture on communities. The “poverty” literature has focused 
on the role of small-scale and subsistence forms of aquaculture for household 
food security and incomes (e.g., Bondad-Reantaso and Subasinghe 2013). The 
“community” literature adopts a more critical approach to the distribution of 
benefits and losses from aquaculture among farm and non-farm households 
(e.g., Paprocki and Cons 2014; Toufique and Gregory 2008).

In focusing on the farm and its immediate environs, studies in the first 
strand tend to take the aquaculture value chains as given, paying little attention 
to chain transformation (change in structure and conduct) over time. The first 
strand is often based on surveys with small or unrepresentative samples, or on 
community case studies, and is “micro” in scope, largely neglecting the “meso” 
structural context in which farms and farm households are embedded.

The second strand, which we call “value chains,” has been dominated 
by work on international fish and seafood value chains, particularly those 
to export markets in developed countries (e.g., Goss, Burch and Rickson 

1 An earlier version of the chapter was published in Aquaculture, 493: 456-468. This is reproduced 
with permission of the publisher.



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 413

2000), rather than domestic market value chains linking rural to urban 
areas. A corollary of this focus is a near exclusive attention to value chains 
supplying the few species (principally shrimp and salmon) demanded by 
developed country markets (Belton and Bush 2014).

The second strand also tends to focus on value chain governance and 
institutions (e.g., contracts, standards, and certification schemes). For example, 
it includes studies on the role of third-party standards and certification in 
governing value chains serving developed country export markets (Hatanaka, 
Maki, Carmen Bain, and Lawrence Busch 2005). This has highlighted 
challenges of compliance with such standards for small farmers (e.g., Marschke 
and Wilkings 2014).

By contrast, the second strand pays little attention to technological 
change among actors within chain segments. Moreover, even though the 
strand takes in a view not just of the aquaculture farm but also of midstream 
and downstream segments of the value chains, it tends to do so with small, 
non-representative sample surveys or case studies or key informant work 
(e.g., Macfadyen et al. 2012; Veliu, Gessese, Ragasa, and Okali 2009). As 
a result, there has been little detailed quantitative work on the dynamics 
of transformation of the structure (such as concentration over or within 
segments) and conduct (such as technologies used by the actors) of value 
chains overall and per segment.

The above synopsis of the literature leads to our making two critiques 
which we focus on the Asian context. On the one hand, contrary to the export 
focus of the existing aquaculture value chain literature, the great majority 
of fish farmed in Asia is sold and consumed in Asian domestic markets. For 
example, in Bangladesh, 94 percent of aquaculture production is destined 
for domestic consumption (calculated from FAO 2016). Furthermore, 42 
percent of this fish is consumed in urban areas,2 with urban dwellers having 
an average consumption per capita of 21.8 kg per capita, 31 percent greater 
than that of rural consumers (Toufique and Belton 2014). Rapid increases 
in urban consumption of farmed fish are consistent with changes taking 
place in food systems throughout Asia, as consumption has diversified from 
basic staples into higher value non-staple foods with rising real incomes. 
These developments are particularly significant for Bangladesh, where fish 
is the most important food after rice in terms of share of the food budget in 
value terms (Reardon et al. 2014).

On the other hand, both the “micro socioeconomics” and “value chain” 
literatures tend to have a static perspective. This approach is at odds with 

2 Compare that with the proportion of Bangladeshi population living in urban areas, which 
was 34 percent in 2015 http://data.worldbank.org/indicator/SP.URB.TOTL.IN.ZS



414 Securing Food for All in Bangladesh

several trends. First, aquaculture is growing fast in Asia. Over 1984 to 2014, 
Bangladesh’s farmed fish jumped from 124,000 tons to 1.96 million ton, 
increasing by 1,580 percent. As a result, aquaculture now accounts for 55 
percent Bangladesh’s fish supply, up from just 16 percent three decades 
ago (DOF 1994, 1997; 2006, 2015). Second, there has been a rapid shift 
from home-consumption (from one’s own pond) to purchasing farmed 
fish from the market: consumers of farmed fish got 92 percent of it via 
purchase from the market in 2010, versus only 79 percent in 2000 (data 
extracted from BBS 2011).

Let us surmise that the share of purchases in farmed fish consumption 
grew by 10 percentage points in total consumption each decade, extrapolating 
from that change in the 2000s. That would mean that the purchase share 
was about 60 percent in the 1980s. Applying that assumption to the volume 
of farmed fish output in 1984 means there were roughly 75,000 tons in 1984. 
Applying the 92 percent to the output volume of 2 million tons in 2014 
means there were roughly 1.84 million tons in 2010. That means the farmed 
fish market grew by a factor of 25 times in three decades. Note from above 
that in 2014 there were 1.96 million tons of farmed fish in 2014. Hence, 
1.84/1.96 of the farmed fish output is marketed, or 94 percent is marketed, 
and only 6 percent is home-consumed.3 This implies that “commercial 
aquaculture” (which we define simply as fish farming output that is sold, 
with no specification of the size of the farm) has moved to be far more 
important than subsistence fish farming. Yet subsistence aquaculture is the 
traditional focus of much of the literature on aquaculture in Asia.

Third, there has been rapid diversification of farmed fish composition. 
This involves a shift from traditional carps to introduced species (tilapia 
and pangasius) that lend themselves better than carp to intensification 
through higher stocking densities combined with use of manufactured 
feeds. This is an example of what economics terms the “product cycle”, 
where in the evolution of a sector one observes a shift from traditional niche 
products to commoditized bulk products for a larger market, and finally 
to differentiated products either as varieties of the commoditized products 
or new niche products introduced. Typically, there is also technological 
change accompanying the increase in scale and, finally, in the creation or 
adaption for introduction of differentiated products. The product cycle in 
aquaculture has not been studied in Asia as an evolution in the market, 
although there has been extensive study of the technical issues in the farming 
of tilapia and pangasius.

3 Note that the present fish farm survey results presented in this chapter show a sales share in 
total aquaculture output of 92 percent, so the macro and micro data track closely.



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 415

Fourth, far less studied is a rapid transformation of the structure of 
domestic aquaculture value chains in Asia, shown by the present survey 
results for Bangladesh. As the sector expanded, rapid commercialization and 
diversification of species occurred, and there was a proliferation of value chain 
actors, and in some cases concentration among them. This has been occurring 
both upstream from the farm, in feed milling and hatcheries, and downstream 
from the farm, in transport and wholesale.

The great majority of these changes have been driven by small and medium 
enterprises. These changes can be categorized as “immanent development” 
(Belton and Little 2011), that is, development unplanned and undirected 
by government or NGOs, arising mainly from private household, firm, and 
community choices, driven by changes in demand, technology, communi-
cations, and infrastructure, and abetted by propitious policies. This can be 
contrasted with “interventionist development” (NGO projects, centralized 
planning by governments). The “Quiet Revolution” in agro-food systems in 
Asia, observed by Reardon, Chen, Minten, and Adriano (2012) in rice and 
potatoes in Bangladesh, India, and China, is symptomatic of these broad 
processes of immanent development led by small farms and small off-farm 
enterprises. We argue that aquaculture in Bangladesh has experienced a 
similar quiet revolution.

Despite the rapid growth and restructuring of the upstream segments 
of inputs and services to aquaculture, and the downstream segments 
moving farmed fish to wholesale markets and retailers and consumers, 
these off-farm components have been little studied in Bangladesh—and 
certainly not yet using representative sample surveys of the actors in these 
chains. This omission is important because these structural changes in the 
supply chain have facilitated on-farm growth and technology change and 
commercialization.

In this chapter, we address the above four trends as a confluence, with an 
emphasis on the latter one, structure and conduct change in the aquaculture 
value chain in Bangladesh, with a focus on fish. We address two questions 
and thus important gaps in knowledge about value chain transformation. 
First, how is the domestic fish value chain restructuring? Second, how is 
the conduct of the segments changing in terms of product composition 
and technology? It is beyond the scope of this study to explore impacts on 
farmers or consumers of these value chain changes; that is an agenda for 
further research.

The chapter proceeds as follows. First, we describe the survey method. 
Second, we outline the characteristics of the main geographical “zones” 
or clusters included in the study, where high concentrations of farms and 



416 Securing Food for All in Bangladesh

other off-farm value chain actors occur. Third, we address the structure and 
conduct changes in the various segments of the aquaculture value chains 
in these zones serving rural and urban markets. Fourth, we conclude with 
policy implications.

12.2 Multi-layered Methodology in Comparative Perspective
We use a multi-layered methodology that is unique in several respects. First, 
we undertake a meso analysis (district by district, over a set of districts) 
focusing on growth and industrial organization, namely size distribution 
and thus concentration of actors per segment. This uses key informant focus 
groups at the district levels across four cluster areas (the main aquaculture 
areas in the country) to reconstruct inventories of numbers by size strata 
of actors in the main segments of the aquaculture value chain (hatcheries, 
feed mills, feed dealers, fish farms, and fish wholesalers).

Second, we undertake a micro analysis (in the same districts as the 
meso study) focusing on land and non-land productive assets and conduct 
(technology of production, procurement of inputs, and marketing of outputs) 
of a substantial sample of actors per segment of the value chain. These are 
formal structured surveys, not key informant studies. The questionnaires use 
the same logical structure but applied to their segment so they give comparable 
information over the segments about each segment and its relation to the 
other segments, such as traders’ purchases from farmers and farmers’ sales to 
traders, or whether farmers get value chain finance (advances) from traders. 
We call this micro survey approach “stacked value chain surveys” (after 
Reardon, Chen, Minten, and Adriano 2012) as full surveys are stacked one on 
top of the other from the upstream to the downstream segments. This differs 
sharply from the typical value chain study which uses very small samples and 
tends to rely on key informants, and does not use comparable questionnaires 
across segments or statistically robust samples. These kind of small sample 
studies thus cannot test hypotheses concerning determinants of behavior and 
variation over strata of actors in given segments, or determinants of linkages 
among the segments.

To the best of our knowledge, this multilayered approach has not been 
done in any other aquaculture value chain study. It is unique in several 
ways. First, no other study has done this meso analysis. Second, no other 
aquaculture study has done the stacked survey approach. Third, no other 
aquaculture value chain study has taken advantage of the cross perspective 
of meso and micro quantitative analysis.

We view our methodological approach as distinct from but complementary 
with two other multilayered approaches in recent research on value chains 



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 417

and rural economic transformation in developing regions. First, Ponte and 
Sturgeon (2014) provide a conceptualization of value chain analysis that 
combines three levels (macro, or the whole value chain’s governance, a 
micro level of determinants and dynamics of exchange at individual value 
chain nodes, and a meso level of the diffusion of the nodal level linkage 
mechanisms). Their approach emphasizes institutions and governance. 
Second, recent work in development geography on agrarian transitions in 
Asia (e.g., Rigg and Vandergeest 2012) combines two levels: community 
and household/individual livelihoods. Analysis of community takes place 
at a similar geographic scale to our meso level, but is more complex and 
focuses more on social outcomes of transformation. Similarly, analysis of 
livelihoods focuses on the micro level of determinants and consequences 
of a broader set of actions (e.g., migration and local nonfarm activity) than 
those pertaining to specific value chains, as well as on economic decisions 
that affect household interactions with the market. The work focuses on 
the rapid social and economic change occurring in rural Asia, including for 
example de-agrarianization.

Our study is complementary to Ponte and Sturgeon (2014) because our 
empirical approach allows cross-segment testing at the meso and micro level 
of the presence of “institutions” such as value chain finance. The study is also 
complementary to the approach of Rigg and Vandergeest (2012) to agrarian 
transitions. While our analysis does not offer (in the manifestation here) a 
fine-grained analysis of implications of change for individuals, households 
and communities, the “quiet revolution” provides an alternative framework 
for viewing processes of rural change related to agriculture. The study also 
provides an empirical example of rural transformation (with urban linkages) 
that does not necessarily entail de-agrarianization (delinking of livelihoods 
from agriculture)—quite the opposite, though our view of agriculture includes 
both farm and off-farm elements. Future research could combine a stacked 
survey approach with more fine-grained qualitative attention to the dynamics 
of livelihoods for those included or excluded from value chains and the 
communities of which they are part.

12.3 The Study Areas and Their Characteristics
To select our study zones, we undertook an extensive field-based “rapid 
reconnaissance” to identify the major clusters of (fish) aquaculture in the 
country. The importance of these areas was confirmed by crosschecks with 
official statistics and analysis of the 2008 Agricultural Census. On this basis, 
four production zones or clusters are identified in the Southwest, South-



418 Securing Food for All in Bangladesh

center, North, and East. Each includes an array of most or all of the segments 
of the rural part of the farmed fish value chain.

The zones are listed in Table 12.1. The sample for the stacked survey 
has been drawn using purposive stratified random sampling because fish 
farming is concentrated in certain districts, and a nationally representative 
sample is neither necessary nor financially feasible. In each district, upazilas 
(sub-districts) with negligible fish production are eliminated from potential 
selection. This resulted in retention of 102 upazilas in 20 districts (Table 
12.1). Within each zone, upazilas are randomly selected using proportional 
probability sampling (PPS), and 32 are selected out of the retained universe 
of 102. All mouzas (administrative sub-units) in each selected upazila are 
selected; those with fewer than 20 fish farmers are dropped. Once the list of 
mouzas was thus trimmed, two to three mouzas were randomly selected per 
selected upazila in each zone. These become the primary sampling units (PSU). 
Once PSUs are selected, a census of fish farmers is made in each, and 25 
farmers are randomly selected per PSU (20 farmers, plus 5 replacements). 
The final farm household sample is distributed over 20 districts, 32 upazilas, 
and 77 mouzas (PSU).

Table 12.1: Zones and Sampled Districts

Zone Districts

East Chittagong, Noakhali, Comilla, Brahmanbaria, Sylhet, Cox’s Bazar
North Bogra, Dinajpur, Gazipur, Mymensigh, Natore, Narsingdi

Southwest Khulna, Satkhira, Bagerhat

South-center Barisal, Bhola, Chandpur, Jessore, Gopalgonj

Source: Study Survey 2014.

The selected mouzas are representative of 86 percent of the fish pond 
areas in the districts selected. In turn, the districts selected constitute 61 
percent of all pond production in the country. (Bangladesh has 64 districts, 
and our 20 districts represent 61 percent of pond production of the country 
according to BBS numbers for 2014).

Survey questionnaires included four categories of questions: (a) demographic 
and business characteristics such as asset holdings; (b) intermediate input 
and factor procurement (land, labor, and capital, including variable and quasi-
fixed inputs); (c) production technology and value addition; (d) marketing 
of outputs. In each upazila, a rapid enumeration of hatcheries, traders, and 
feed dealers was conducted. Hatcheries, traders, and feed dealers were randomly 



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 419

selected for survey from these lists. The sample design for feed mills was 
based at the district level. Enumeration of feed mills was conducted in the 
sampled 20 districts, and mills were selected randomly.

Table 12.2: Definitions of Actor Size by Actor Type

Actor Defining characteristic Size category Definition

Hatcheries Total production area  
in decimals

Small Less than 0.04 ha
Medium 0.04-0.8 ha
Large >0.8 ha

Feed Mills Total metric tons of feed 
produced per month

Small Less than 50 MT
Medium 50 to 300 MT
Large More than 300 MT

Input dealers Total metric tons of feed  
sold per month

Small Less than 10 MT
Medium 10 to 100 MT
Large More than 100 MT

Farmers Total pond area  
in decimals

Small <0.2 ha
Medium 0.2-0.8 ha
Large >0.8ha

Traders Total metric tons of fish  
traded per week

Small Less than 1 MT
Medium 1 to 5 MT
Large More than 5 MT

Source: Study Survey 2014.

The sample design for the recent history, inventory of numbers and 
changes in value chain actors was based on mouzas selected for the house-
hold sample. In each mouza, two to five interviews were conducted with 
key stakeholders concerning the number and size distribution of value 
chain actors at the upazila and district level over 2004, 2009, and 2014. To 
obtain an indication of whether concentration of market share was taking 
place, information was collected for three “size of actor” categories (small, 
medium, and large). The definition of the size category varied by type of 
actor, but did not vary across zones.

Table 12.3 shows selected characteristics of the four zones or clusters. 
Several points stand out. First, there is a fairly homogenous picture across 
zones in terms of general characteristics. This may be because all the areas 
identified as containing high densities of ponds are located in major lowland 
rice growing areas with relatively easy access to the capital city, Dhaka. The 
study zones have broadly similar socio-economic conditions, as compared 
to more peripheral and remote areas with less conducive geographies and 
agro-ecologies for aquaculture.



420 Securing Food for All in Bangladesh

Table 12.3: Zone Characteristics

Item South-
west

South- 
centre

North East All

Total area (km2) 8,710 8,492 13,752 15,809 46,763
Population density (inhabitants/km2) 757 1,354 1,388 1,445 1,302

Monthly per capita expenditure (BDT) 2,359 2,842 2,621 2,932 2,730

Road density (km of roads/km2)          
2004 0.11 0.18 0.19 0.21 0.18

2009 0.12 0.19 0.21 0.20 0.19

2014 0.12 0.19 0.22 0.22 0.20

Share of paved roads in total roads          

2004 54% 60% 77% 55% 63%

2009 79% 84% 92% 78% 84%

2014 81% 82% 92% 82% 85%

Aquaculture area (ha)

2004 168,493 38,614 39,795 113,994 360,896

2009 168,560 45,529 40,619 113,337 368,044

2014 220,223 116,809 126,667 111,794 575,493

Fish pond area (ha)          

2004 11,815 33,570 39,758 68,037 153,180

2009 16,630 46,368 60,071 48,901 171,970

2014 24,247 44,257 60,110 71,493 200,107

Change in pond area (%) 105.2 31.8 51.2 5.1 30.6

Aquaculture production (MT)

2004 125,677 89,953 103,824 219,135 538,589

2009 140,289 114,416 121,491 231,098 607,294

2014 225,798 269,568 469,830 300,914 1,266,110

Fish production (MT)          

2004 37,264 87,852 101,110 177,415 403,641

2009 32,313 149,843 292,211 156,821 631,188

2014 56,107 182,123 398,979 240,468 877,677

Change in fish production (%) 50.6 107.3 294.6 35.5 117.4

a Aquaculture area is the total area of the two main culture systems: fish pond, shrimp/prawn 
farms, plus other minor production systems (pen and cage culture, and culture-based fisheries 
in oxbow lakes (baor), and seasonal floodplains).

Source: BBS Statistical Yearbook of Bangladesh, 2005, 2010, and 2015.



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 421

The study zones are of similar size. They have population densities of 
around 1,400 persons per square km, except for the Southwest (with 800 
persons/km2). The lower population density in the Southwest is a function 
of a large part of the land in its three districts being comprised of uninhabited 
mangrove forest. Income differences over zones are proxied by differences 
in total per capita expenditure per month. Again, the zones do not differ a 
great deal, with an expenditure of roughly $2,100 per year for a five-person 
household. Road density per square kilometer corresponds closely with 
differences in population density (lower in the Southwest, similar in other 
zones). The share of paved roads in total roads jumped dramatically over 
the 10 years from 2004 to 2014 in all zones, to more than 80 percent. The 
North, which had the highest share of paved roads in 2014, at 92 percent, 
also had the highest share in 2004, with 77 percent, indicating a historically 
well-developed transport infrastructure.

Second, as noted above, fish farming has developed rapidly in Bangladesh 
since the 1990s, accelerating during the 2000s. This is reflected in the table 
in the expansion of fish pond area which grew by 31 percent across the four 
zones (fastest in the Southwest and North, with increases of 105 percent and 
51 percent respectively, and lowest in the East, which grew only 5 percent). 
Fish pond output increased more rapidly than pond area, indicating that 
intensification was taking place. Output rose 117 percent overall, with the 
greatest increase in the North (295 percent) and South-central region (107 
percent), and lowest in the East (36 percent). 

Third, yields (per hectare of pond surface) in the zones varied considerably, 
with 2.3 tons/hectare (ha) in the Southwest, to 3.4 in the East, 4 in the South-
center, and 6.7 in the North. As a result of its high productivity, the North 
cluster (mainly Mymensingh) accounted for 45.5 percent of fish production 
in the four zones, from 30 percent of pond area. Large differences in land 
(pond) yields across zones reflect differences in the technologies deployed, 
with the North being the most “advanced” zone, and “cradle” of intensive 
aquaculture in Bangladesh. This status is partly path dependent, reflecting 
a number of initial conditions including: (i) superior road access to the 
capital city Dhaka (ADB 2005); (ii) a history of commercially oriented “green 
revolution” rice farming in districts such as Bogra (Crow 2001); (iii) the 
location of key institutions such as the Bangladesh Fisheries Research 
Institute (BFRI) in Mymensingh district which played an important role 
in the transfer of seed and production technologies for new species to well-
connected farmers and hatcheries in the area (Belton and Little 2011).



422 Securing Food for All in Bangladesh

12.4 Transformation of Structure and Conduct in the Value Chain
This section is organized into three sub-sections. The first focuses on “growth 
and concentration”, essentially an industrial organization perspective, 
using the meso data. The second focuses on commercialization cum spatial 
elongation as they are closely linked. This draws especially on the micro data, 
and is a combination of structure and conduct analyses. The third subsection 
focuses on technological cum product composition/product cycle change 
and patterns, using primarily the micro data, but also linking back to the 
meso data to show that there is a mirror relation where input use changes 
on farms and input supply firms proliferate to meet that demand.

12.4.1 Growth and Concentration
There has been rapid development and proliferation of the off-farm 
components of the fish value chain in the study zones. The combination of 
this plus the rapid rise in aquaculture farms in these areas is creating dense 
clusters of value chain actors in these places. This has occurred “upstream” 
in the value chain, in hatcheries, feed milling, feed wholesale and retail, 
and farms, and “midstream and downstream” in transport, rural and 
urban wholesale markets (arat) and traders (aratdar), and retailing. In all 
segments, astounding development of these enterprises—and acceleration 
of that development in the past 5-10 years - has taken place. Tables 12.4 to 
12.8 show structural change, proxied by numbers of different actors and 
shares of the size strata in the total number. We discuss this segment by 
segment, from upstream to midstream.

12.4.1.1 Hatchery Segment Restructuring

Over the four zones, the survey data show that there was a 207 percent 
increase in hatcheries over the ten years, with the rate of growth fastest in 
the Southwest (314 percent), and slowest in South-center (150 percent). 
This rate of expansion exceeded that of either fish farm numbers (up 
63 percent), or farm output (up 117 percent), thus suggesting a shift to 
purchased seed. Big hatcheries (over 0.8 ha in size) accounted for 53  
percent of hatchery area in 2014, a bit lower than 58 percent in 2004, 
showing slight de-concentration. The share of numbers of big hatcheries 
in all hatcheries over all zones together dropped a bit from 19 percent in 
2004 to 15 percent in 2014. But still by 2014 the hatchery segment was 
concentrated: the big hatcheries had 19 percent of numbers but 53 percent 
of total hatchery area.



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 423

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38

%
42

%
 

60
%

59
%

55
%

Ea
st

 
 

 
 

2%
2%

2%
 

42
%

45
%

50
%

 
57

%
53

%
48

%

A
ll

 
 

 
 

2%
2%

3%
 

40
%

40
%

44
%

 
58

%
58

%
53

%

So
ur

ce
: F

ish
 V

al
ue

 C
ha

in
 M

es
o 

Le
ve

l S
ur

ve
y 

20
14

.



424 Securing Food for All in Bangladesh

The rapid increase in hatchery numbers, outstripping farm growth, and 
the tendency toward size de-concentration, may indicate the spread of new 
small and medium sized hatcheries beyond original “core” clusters. The 
preponderance of hatcheries in northern Bangladesh reflects the emergence 
of Bogra and Mymensingh as major producers of seed, for historical reasons 
described above. Bogra hatcheries export pangasius seed to India in addition 
to serving the domestic market (Ali, Haque, and Belton 2013).

Hatchery growth has been accompanied by rapid expansion of nurseries, 
particularly in nearby areas, which buy hatchlings or fry from hatcheries and 
raise them to fingerling size for sale to farms, directly, via small traders (patil 
wallah), or (over longer distances) by larger agents. Overall (from the survey 
but not shown in the tables), 53 percent of the seed produced by hatcheries 
is sold to fingerling traders, and 44 percent direct to farmers and nurseries.

12.4.1.2 Feed Mill Segment Restructuring

For feed mills (Table 12.5), as with hatcheries, there is a high degree of spatial 
concentration in the North, where 62 percent of the country’s mills are located. 
These are located mostly in Gazipur, a highly industrialized peri-urban district 
bordering Dhaka to the South and Mymensingh to the North. Just under one-
third of mills are located in the Southeast, around Chittagong, Bangladesh’s 
second city and main seaport, and another major industrial center.

The number of feed mills jumped even faster than that of hatcheries, 
reflecting the later introduction and adoption of feeds as compared to hatchery 
seed. Interviews conducted during our rapid reconnaissance indicated that 
there were 7-8 feed mills (defined as formal firms, not backyard feed operations 
on farms) in Bangladesh in 2003. The number increased 15-fold to about 100 
mills by 2014. Table 12.5 indicates the numbers of mills increasing by 268 
percent over the period to 255, and rising fast in all zones. The difference 
between the 100 formal firms and the 255 total mills arises because the latter 
figure includes “semi-auto” feed mills—low-cost, locally manufactured 
machines used to produce small quantities of feed on-farm or by one local 
farm for several others around it.

The feed mill segment is even more concentrated than the hatchery 
segment for two reasons. First, many have developed from the addition of 
lines by existing large domestic poultry feed firms, with a “head start” in the 
industry, from major investments by foreign companies such as China’s New 
Hope, Thailand’s CP, and India’s ACI Godrej. Second, there are economies of 
scale involved in sourcing raw materials, maintaining high utilization rates, 
and spreading fixed costs over a large volume. Big mills (with a capacity of 300 
tons/month) accounted for 67 percent of total feed production volume in 2014, 
although the share of volume had barely changed from 2004 (66 percent).



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 425

Ta
bl

e 
12

.5
: S

tr
uc

tu
ra

l C
ha

ng
e 

in
 F

ee
d 

M
ill

 C
lu

st
er

s o
ve

r 1
0 

Y
ea

rs

Zo
ne

Fe
ed

 m
ill

s

To
ta

l  
nu

m
be

r
 

Sh
ar

e 
of

 sm
al

l i
n 

to
ta

l 
nu

m
be

r
 

Sh
ar

e 
of

 m
ed

iu
m

 in
 to

ta
l 

nu
m

be
r

 
Sh

ar
e 

of
 la

rg
e 

in
 to

ta
l 

nu
m

be
r

20
04

20
09

20
14

 
20

04
20

09
20

14
 

20
04

20
09

20
14

 
20

04
20

09
20

14

So
ut

hw
es

t
4

5
7

 
68

%
56

%
49

%
 

23
%

37
%

46
%

 
9%

7%
5%

So
ut

h-
ce

nt
er

2
7

9
 

0%
29

%
22

%
 

50
%

43
%

56
%

 
50

%
29

%
22

%

N
or

th
62

10
0

15
4

 
30

%
30

%
27

%
 

40
%

37
%

38
%

 
30

%
34

%
35

%

Ea
st

28
43

84
 

43
%

30
%

45
%

 
26

%
38

%
27

%
 

31
%

32
%

28
%

A
ll

95
15

5
25

5
 

35
%

30
%

33
%

 
35

%
37

%
35

%
 

30
%

32
%

32
%

 
 

 
Sh

ar
e 

of
 sm

al
l i

n 
to

ta
l 

vo
lu

m
e

 
Sh

ar
e 

of
 m

ed
iu

m
 in

 to
ta

l 
vo

lu
m

e
 

Sh
ar

e 
of

 la
rg

e 
in

 to
ta

l 
vo

lu
m

e

 
 

 
 

 
20

04
20

09
20

14
 

20
04

20
09

20
14

 
20

04
20

09
20

14

So
ut

hw
es

t
 

 
 

 
17

%
13

%
11

%
 

41
%

59
%

71
%

 
42

%
28

%
18

%

So
ut

h-
ce

nt
er

 
 

 
 

0%
3%

3%
 

28
%

36
%

48
%

 
72

%
61

%
49

%

N
or

th
 

 
 

 
4%

3%
3%

 
33

%
29

%
29

%
 

64
%

68
%

69
%

Ea
st

 
 

 
 

6%
3%

6%
 

23
%

30
%

26
%

 
71

%
66

%
68

%

A
ll

 
 

 
 

4%
3%

4%
 

30
%

30
%

29
%

 
66

%
66

%
67

%

So
ur

ce
: F

ish
 V

al
ue

 C
ha

in
 M

es
o 

Le
ve

l S
ur

ve
y 

20
14

.



426 Securing Food for All in Bangladesh

12.4.1.3 Feed Dealer Segment Restructuring

Input dealers (Table 12.6) are mainly feed dealers who distribute feed for 
mills. They are very numerous, totaling 15,000 over the four zones, up from 
7,690 in 2004 (hence a two-fold growth, versus a 1.6-fold growth of farmers). 
Like hatcheries and mills, input dealers are concentrated in the North 
(which is home to 56 percent of dealers, but only 35 percent of farmers). 
But they are underrepresented relative to farmers in the Southwest and 
South-center, perhaps unsurprisingly given that fish yields (and thus by 
implication feed use), are lowest in these two zones. Some concentration 
in market share is present, with larger dealers (those selling more than 
100 tons of feed per month) having 54 percent of the traded volume in 
2004. Their share dropped to 48 percent in 2014 as many new small dealers 
entered the scene.

12.4.1.4 Fish Farm Segment Structure Restructuring

Fish farmers are more evenly distributed spatially than other value chain 
actors over the four clusters, with the North accounting for 36 percent 
and the Southwest and South-center 29 percent each, but the East only 
9 percent. The total number of fish farmers across the four zones grew 63 
percent, from 1.08 million in 2004 to 1.76 million in 2014, but the relative 
share of farm numbers across zones changed little over this period.

From the perspective of average household operated aquaculture land 
(pond surface), the average farm size in our study zones changed little over 
the decade, even as the total population of these nearly doubled. When the 
average area of aquaculture landholdings operated across zones between 
2008 and 2013 is compared, the overall increase was moderate (7.2 percent). 
However, there is considerable variation between zones, with the North 
and South-center registering the largest increases, up 19 percent, up from 
(0.3 ha to 0.35 ha), and 17 percent from 0.24 ha to 0.28 ha, respectively, 
with other zones registering little change.

Fish farming households sampled in the stacked survey operated 
0.29 ha of ponds in 2008 and 0.31 ha in 2013. Fish farmers in Bangladesh 
hold 0.86 ha of land (fish and non-fish land combined). Therefore, they 
are located in the second upper land quintile of farmers in the country, 
and they have approximately double the 0.45 ha average landholding 
of rice farmers (Ahmed et al. 2013). However, they are smaller than a 
typical fish farmer in other countries in the region, such as Myanmar and  
Thailand.



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 427

Ta
bl

e 
12

.6
: S

tr
uc

tu
ra

l C
ha

ng
e 

in
 F

ee
d 

D
ea

le
r C

lu
st

er
s o

ve
r 1

0 
Y

ea
rs

Zo
ne

Fe
ed

 d
ea

le
rs

To
ta

l  
nu

m
be

r
 

Sh
ar

e 
of

 sm
al

l i
n 

to
ta

l 
nu

m
be

r
 

Sh
ar

e 
of

 m
ed

iu
m

 in
 to

ta
l 

nu
m

be
r

 
Sh

ar
e 

of
 la

rg
e 

in
 to

ta
l 

nu
m

be
r

20
04

20
09

20
14

 
20

04
20

09
20

14
 

20
04

20
09

20
14

 
20

04
20

09
20

14

So
ut

hw
es

t
1,

37
3

1,
91

5
2,

46
1

 
66

%
69

%
65

%
 

31
%

29
%

31
%

 
3%

3%
4%

So
ut

h-
ce

nt
er

1,
42

8
2,

10
9

3,
11

1
 

50
%

48
%

43
%

 
42

%
45

%
48

%
 

8%
7%

9%

N
or

th
4,

30
8

6,
83

5
8,

44
8

 
43

%
41

%
44

%
 

32
%

36
%

36
%

 
25

%
23

%
20

%

Ea
st

58
1

90
7

1,
46

4
 

69
%

62
%

60
%

 
28

%
32

%
34

%
 

3%
5%

7%

A
ll

7,
69

0
11

,7
66

15
,4

83
 

50
%

49
%

49
%

 
34

%
36

%
37

%
 

16
%

15
%

14
%

 
 

 
Sh

ar
e 

of
 sm

al
l i

n 
to

ta
l 

vo
lu

m
e

 
Sh

ar
e 

of
 m

ed
iu

m
 in

 to
ta

l 
vo

lu
m

e
 

Sh
ar

e 
of

 la
rg

e 
in

 to
ta

l 
vo

lu
m

e

 
 

 
 

 
20

04
20

09
20

14
 

20
04

20
09

20
14

 
20

04
20

09
20

14

So
ut

hw
es

t
 

 
 

 
13

%
15

%
12

%
 

68
%

67
%

64
%

 
19

%
19

%
23

%

So
ut

h-
ce

nt
er

 
 

 
 

7%
7%

5%
 

61
%

67
%

63
%

 
32

%
27

%
31

%

N
or

th
 

 
 

 
4%

4%
4%

 
31

%
35

%
38

%
 

65
%

61
%

58
%

Ea
st

 
 

 
 

15
%

11
%

9%
 

65
%

61
%

58
%

 
20

%
28

%
32

%

A
ll

 
 

 
 

6%
5%

6%
 

41
%

44
%

46
%

 
54

%
51

%
48

%

So
ur

ce
: F

ish
 V

al
ue

 C
ha

in
 M

es
o 

Le
ve

l S
ur

ve
y 

20
14

.



428 Securing Food for All in Bangladesh
Ta

bl
e 

12
.7

: S
tr

uc
tu

ra
l C

ha
ng

e 
in

 F
is

h 
Fa

rm
er

 C
lu

st
er

 o
ve

r 1
0 

Y
ea

rs

Zo
ne

Fi
sh

 fa
rm

er
s

To
ta

l  
nu

m
be

r
Sh

ar
e 

of
 sm

al
l i

n 
to

ta
l 

nu
m

be
r

Sh
ar

e 
of

 m
ed

iu
m

 in
 to

ta
l 

nu
m

be
r

Sh
ar

e 
of

 la
rg

e 
in

 to
ta

l 
nu

m
be

r

20
04

20
09

20
14

20
04

20
09

20
14

20
04

20
09

20
14

20
04

20
09

20
14

So
ut

hw
es

t
33

5
41

7
49

4
15

%
17

%
17

%
41

%
41

%
46

%
44

%
42

%
37

%

So
ut

h-
ce

nt
er

31
9

38
4

48
7

39
%

35
%

42
%

39
%

45
%

34
%

22
%

20
%

23
%

N
or

th
34

3
47

4
63

4
43

%
46

%
45

%
34

%
33

%
32

%
23

%
21

%
23

%

Ea
st

84
11

2
14

8
44

%
43

%
45

%
34

%
37

%
32

%
22

%
20

%
24

%

A
ll

1,
08

1
1,

38
8

1,
76

3
33

%
34

%
36

%
37

%
39

%
37

%
29

%
27

%
27

%

Sh
ar

e 
of

 sm
al

l i
n 

to
ta

l 
po

nd
 a

re
a

Sh
ar

e 
of

 m
ed

iu
m

 in
 to

ta
l 

po
nd

 a
re

a
Sh

ar
e 

of
 la

rg
e 

in
 to

ta
l 

po
nd

 a
re

a

 
 

 
 

20
04

20
09

20
14

20
04

20
09

20
14

20
04

20
09

20
14

So
ut

hw
es

t
 

 
 

4%
4%

4%
30

%
31

%
36

%
66

%
65

%
59

%

So
ut

h-
ce

nt
er

 
 

 
14

%
12

%
15

%
41

%
47

%
36

%
46

%
41

%
49

%

N
or

th
 

 
 

15
%

17
%

16
%

36
%

37
%

34
%

48
%

46
%

50
%

Ea
st

 
 

 
16

%
16

%
16

%
36

%
41

%
34

%
48

%
44

%
50

%

A
ll

 
 

 
10

%
11

%
12

%
35

%
37

%
35

%
54

%
52

%
53

%

So
ur

ce
: F

ish
 V

al
ue

 C
ha

in
 M

es
o 

Le
ve

l S
ur

ve
y 

20
14

.



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 429

Ta
bl

e 
12

.8
: L

an
dh

ol
di

ng
s a

nd
 T

en
an

cy
 b

y 
Y

ea
r a

nd
 Z

on
e

Zo
ne

So
ut

hw
es

t
So

ut
h-

ce
nt

er
N

or
th

Ea
st

A
ll

20
08

20
13

20
08

20
13

20
08

20
13

20
08

20
13

20
08

20
13

1.
 T

ot
al

 n
on

-fi
sh

 la
nd

 o
ve

ra
ll 

(H
a/

H
H

) (
ze

ro
es

  
in

 a
ve

ra
ge

)
0.

26
0.

31
0.

45
0.

54
0.

38
0.

42
0.

33
0.

39
0.

34
0.

40

2.
 T

ot
al

 fi
sh

 p
on

d 
la

nd
, (

H
a/

H
H

) (
ze

ro
es

  
in

 a
ve

ra
ge

)
0.

59
0.

64
0.

24
0.

28
0.

30
0.

35
0.

49
0.

48
0.

43
0.

46

2.
1 

To
ta

l o
pe

ra
te

d 
la

nd
 (u

se
d,

 in
cl

ud
in

g 
 

ow
ne

d 
an

d 
re

nt
ed

-in
 la

nd
s)

0.
51

0.
52

0.
18

0.
21

0.
17

0.
22

0.
20

0.
20

0.
29

0.
31

2.
1.

1 
Se

lf-
ow

ne
d

0.
36

0.
33

0.
12

0.
12

0.
10

0.
11

0.
05

0.
05

0.
18

0.
17

2.
1.

2 
Jo

in
t-

ow
ne

d 
w

ith
 a

no
th

er
 H

H
0.

12
0.

16
0.

04
0.

08
0.

01
0.

06
0.

09
0.

10
0.

07
0.

10

2.
1.

3 
Re

nt
ed

 in
0.

04
0.

03
0.

02
0.

01
0.

06
0.

05
0.

06
0.

05
0.

04
0.

04

2.
2 

Re
nt

ed
 o

ut
0.

07
0.

08
0.

02
0.

03
0.

02
0.

02
0.

03
0.

03
0.

04
0.

04

2.
3 

Jo
in

tly
 o

w
ne

d,
 u

se
d 

by
 o

th
er

 H
H

0.
01

0.
03

0.
04

0.
04

0.
10

0.
11

0.
25

0.
24

0.
10

0.
10

3.
 T

O
TA

L 
la

nd
0.

85
0.

95
0.

69
0.

82
0.

68
0.

77
0.

82
0.

86
0.

77
0.

86

N
ot

e:
 

H
H

 =
 h

ou
se

ho
ld

So
ur

ce
: F

ish
 V

al
ue

 C
ha

in
 F

ar
m

 H
ou

se
ho

ld
 S

ur
ve

y 
20

14
.



430 Securing Food for All in Bangladesh

Further, the average 0.31 ha of pond area per fish farm in our sample 
is five times the average 0.06 ha area of “homestead ponds” reported by 
Belton and Azad (2012) in Bangladesh. This difference is explained above 
in the sample methods section where we note that districts with high 
concentrations of fish farming, which our household survey analysis shows, 
tends to be correlated with higher shares of commercial farms and lower 
shares of (subsistence) homestead fish ponds, were purposively selected.

Moreover, fish farming tends to be concentrated among the upper 
stratum of small farms. Figures extracted from Bangladesh Integrated 
Household Survey (BIHS) data—a nationally representative survey of rural 
households conducted by the International Food Policy Research Institute 
(IFPRI) in 2011-2012—show that 89 percent of the aquaculture households 
contributed just 25 percent of total production, while the top 2.4 percent of 
fish farming households accounted for 50 percent of total output.

Our meso survey data reflect this concentration. Larger farms (with 0.4 
ha or more of pond area) constituted 27 percent of fish farms but had 53 
percent of pond area in 2014, with little change in this share since 2004. The 
share of area among farmers of other size categories also remained stable 
over this period, at around 35 percent for medium and 11 percent for small 
farms (<0.2 ha), suggesting that while many new producers have entered 
farming, there has been little, if any, consolidation into larger farm units.

Table 12.9: Factor Productivity in 2013

 Observations in 2013 South-
west

South-
center

North East All

465 280 420 340 1505

1. Total fish output (kg) per:          

1.1 Labor day (own + hired) 9.0 7.2 32.7 20.8 18.9

1.2 Own labor day 10.3 10.5 42.5 23.8 23.9

1.3 Pond hectare 801 2,565 10,017 2,916 3,352

1.4 Capital (thousand BDT)a 5.3 9.8 25.2 10.2 13.0

a Capital is calculated as the total variable cost (labor, rent, purchased inputs, etc.), plus the 
annual amortization of quasi-fixed assets.

Source: IFPRI/MSU Fish Value Chain Farm Household Survey 2014.

Finally, Table 12.9 shows yields of 3.35 tons/ha on average in the sample 
in 2013. The North has far higher land-yields than the rest of the zones. 
This helps to explain why the concentration of farms in the North is low 
relative to the high concentration in the North of hatcheries, feed mills, and 



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 431

input dealers. The North simply has a much more intensive production 
technology, heavy in external inputs supplied by these off-farm enterprises, 
and that intensification is reflected in its extraordinary yields relative to the 
rest of the fish farming clusters. Absolute yield growth was greatest in the 
North, up 96 percent, from 5 tons/ha to 9.8 tons/ha, while in relative terms 
the East grew faster from a lower base, up 113 percent from 1.3 to 2.7 tons/
ha. South-center grew only 19 percent, from 2 to 2.4 tons/ha, while the 
Southwest remained stagnant at 0.7 tons/ha (see Table 12.13).

12.4.1.5 Fish Wholesale Segment Restructuring

The fish wholesale segment has been expanding rapidly. This occurred with 
a proliferation, especially during the 2000s, of rural fish wholesale markets, 
and an increase in fish wholesale markets in cities such as Dhaka. Fish 
trader numbers more than doubled across the four zones, from 14,800 in 
2004 to 31,300 in 2014 (2.1 times, versus 1.6 times for farmers).

The largest share of traders was in the North (41 percent) in 2014, 
which had only 23 percent of the traders in 2004. Trader startups followed 
the concentration of fish production. Most village traders started about 10-
15 years ago, over the same period as the beginning and development phase 
of the aquaculture boom.

12.4.2 Commercialization and Spatial Elongation
In Bangladesh mainly over the past 15 years, the value chain for farmed fish 
has commercialized, and it has “lengthened” geographically. This is a typical 
trend in transformation and modernization of food supply chains, with 
concomitant inter-district market integration and reduction of transaction 
costs. This happened for example in rice and potatoes in Asia over the past 
decade (Reardon, Chen, Minten, and Adriano 2012). The commercialization 
of fish farming is itself dependent on the proliferation of services we discussed 
above: the development of off-farm components of the value chain permits a 
division of labor wherein small farmers can specialize in pond operations, and 
enjoy cost saving via economies of scale, economies of scope, and economies 
of agglomeration by relying on the upstream feed and seed purveys and 
downstream wholesale and logistic services that themselves are specialized 
enterprises. Belton, Ahmed, and Jahan (2014) contend that the availability 
of these services facilitates the entry of smaller producers into commercial 
fish farming; Reardon, Chen, Minten, and Adriano (2012) contend similarly 
for rice and potato sectors. We discuss the trends of commercialization and 
chain lengthening below, from upstream to midstream.



432 Securing Food for All in Bangladesh
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.



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 433

12.4.2.1 Seed Commercialization

Farmers have shifted from trapping wild fish on their farms or buying locally 
available wild seed in the early 1990s (Ahmed, Rab, and Bimbao 1993) , to 
stocking hatchery-produced seed in the 2000s. By 2011, 98 percent of fish 
seed was produced by private hatcheries (Belton and Little 2011).

The shift to hatchery-produced seed resulted in a lengthening of the 
distances over which seed was traded. Private hatcheries developed first 
in Jessore where there were ideal iron-free water conditions and technical 
training was initially provided by a government hatchery in the 1970s. 
A vibrant long-distance trade in seed between Jessore and other areas, 
including the Northwest, developed rapidly. From the early 1990s, techniques 
first demonstrated in Jessore were established in other areas, such as Bogra 
in the North (also a location with iron-free groundwater), as a result of 
informal transfer of technical knowledge among seed producers (Lewis, 
Gregory, and Wood 1993). Many hatcheries were also established in 
Comilla (an area with a history of nursing wild seed captured, and the site 
of one of the earliest government hatcheries), and Mymensingh—a location 
with less ideal environmental conditions, but with technical support from 
government institutions, aquaculture development projects, and demand 
for seed from a rapidly growing farm sector. The geography of hatcheries 
reflects a mix of initial environmental and institutional conditions and the 
location sources of demand.

These trends have given rise to a situation in which there is a correlation 
of the level of activity of the broad cluster and the co-location of hatcheries. 
There is strong spatial concentration of hatcheries in the North, which has 
more than half of the hatcheries in the four zones. But our survey also finds 
that on average half of what hatcheries produce is sold to buyers outside 
of their own district (not shown in the tables). Hatcheries tend thus to be 
“shared” across districts and even zones.

12.4.2.2 Feed Commercialization

The commercialization of aquaculture feeds and the geographical lengthening 
of that segment have occurred in lockstep. There has been a long-term shift 
from little use of feed of any type (Ahmed, Rab, and Bimbao 1993), to use of 
feed available on-farm (e.g., cow manure, rice bran), to purchase of the latter, 
and increasingly, to purchase of formulated pelleted feeds. Ninety percent 
of the latter are made by medium and large-scale commercial mills in 2015 
(Mamun-Ur-Rashid, , Belton, Phillips, and Rosentrater 2013).

Large feed mills in the peri-urban industrial zone north of Dhaka, where 
most feedlot poultry farming occurs, distribute feed throughout the country. 



434 Securing Food for All in Bangladesh

Mills are concentrated there for centralized acquisition of inputs, and 
because (similar to other countries) many fish feed manufacturers originally 
produced poultry feeds before diversifying into fish feed by adding additional 
lines. Eighteen of the 25 largest poultry feed mills in Bangladesh also produce 
fish feeds (Khaleduzzaman and Khandaker 2009).

The input acquisition supply chain for feed manufacture stretches over 
long distances. Most dried fish, one of the main ingredients in fish feed, 
is sourced from marine fisheries in coastal districts of Bangladesh but 
increasingly also imported from India and further afield, as is soy (another 
key ingredient). Meat and bone meals, important protein sources for feed, 
are sourced from the European Union (Mamun-Ur-Rashid, Belton, Phillips, 
and Rosentrater 2013). Much of the equipment utilized in the value chain 
(e.g., feed milling machines, vehicles, pumps, cold chain equipment) is 
imported, mainly from East and Southeast Asia, as are chemicals (Mamun-
Ur-Rashid, Belton, Phillips, and Rosentrater 2013).

As elsewhere in Asia, foreign expertise has played an important role 
in the development of hatchery and feed operations (Belton 2012). For 
example, training received by Bangladeshi entrepreneurs (both at courses 
in Thailand and from foreign consultants working in Bangladesh) has 
been important in the establishment of monosex tilapia hatcheries. Over 
time, dependence on these sources of information has lessened as technical 
knowledge has become more widely available within Bangladesh.

12.4.2.3 Fish Farm Commercialization

The shift from subsistence to commercial production in the fish sector 
occurred as initially fish were only home-consumed from the household 
pond, then increasingly sold into nearby markets, and then marketed also 
to more distant urban markets. These sequential changes have occurred 
rapidly. As recently as the early 1990s, Ahmed, Rab, and Bimbao (1993) 
observed that only a small fraction of total harvested farmed fish entered 
the market outside the local village.

In contradiction to the traditional view of fish farming in Bangladesh 
as mainly subsistence-oriented, the value chain survey of the farm segment 
shows that 75 percent of households sell fish. Strikingly, the share of farms 
with a marketed surplus even in these dense aquaculture clusters was only 
57 percent just five years prior to this, indicating that extremely rapid 
commercialization occurred. The Southwest has the highest share of fish 
farming households marketing fish (88 percent), in line with shrimp and 
prawn production in that zone (besides farmed fish); most of the shrimp 
are exported. Figures are around 70-75 percent for the South-center and 
North, and 60 percent for the less advanced (in terms of fish farming) East.



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 435

Table 12.11: Disposal of Fish Farm Harvest by Final User Type, 2013

 Observations in 2013 South-
west

South-
center

North East All

465 280 420 340 1505

1. Share of farmers selling fish 87.5 70.7 74.5 59.7 74.5
2. Farmer’s own consumption 15.4 18.5 4.2 12.2 8.4

3. Sales through different value chains:          

a. Consumed by another farm household 0.3 0.0 0.0 0.0 0.0

b. Direct consumer 0.0 0.7 0.9 0.0 0.7

c. Retailer at traditional market 11.4 7.7 2.7 15.6 6.0

d. Assembler (collector) 5.6 2.8 8.1 14.7 8.4

e. Large wholesaler 49.2 54.5 68.1 56.4 62.8

f. Supplier (broker) 1.5 8.6 8.7 0.6 6.6

g. Supermarket 0.0 0.0 0.0 0.0 0.0

h. Auctioned 16.6 7.1 7.3 0.5 7.1

i. Others 0.1 0.0 0.0 0.0 0.0

j. Total 100.0 100.0 100.0 100.0 100.0

Source: IFPRI/MSU Fish Value Chain Farm Household Survey 2014.

Table 12.11 shows the disposal of fish output by aquaculture households 
in 2013 by final user type. Note that only 8 percent of the fish was home 
consumed; thus, the average household was highly commercialized. 
Interestingly, while yields differ a lot over zones, the marketed surplus rate 
does not: the home consumption share is 4 percent in the North zone and 
about 15 percent in the other zones.

Moreover, in contrast to the common image of the rural fish market 
being dominated by small rural brokers, the market has shifted to rural 
sourcing by large wholesalers based in towns and secondary cities. Tables 
12.12 and 12.13 show that about two-thirds of the marketed volume goes to 
large wholesalers; again, that differs between the North with 68 percent and 
the average of the other zones at 54 percent. Three-quarters of the sales to 
large wholesalers are affected locally (in the village, union, or upazila). By 
contrast, local rural brokers have a mere 5 percent share of the market. Just 
over a decade earlier, fish farmers usually sold their fish to local traders or 
fish collectors (ADB 2005). Interestingly, this is the same market structure 
development that has occurred in rice and potatoes in Asia (Reardon et al. 
2012).



436 Securing Food for All in Bangladesh

Table 12.12: Disposal of Fish Farm Harvest by Final User Location, 2013

 Observations in 2013 South-
west

South-
center

North East All

465 280 420 340 1505
1. Farmer’s own consumption 15.4 18.5 4.2 12.2 8.4
2. Sales through different value chains:          

2.1 Consumed by another farm household 0.3 0.0 0.0 0.0 0.0
2.2 Direct consumer 0.0 0.7 0.9 0.0 0.7
2.3 Retailer at local (village, union,  

upazila) traditional market 11.4 7.7 2.7 15.6 6.0
2.4 Assembler locally 5.6 2.6 5.5 14.7 6.7
2.5 Assembler in same district 0.0 0.2 2.5 0.0 1.7
2.6 Large wholesaler locally 46.3 46.7 64.4 31.8 55.5
2.7 Large wholesaler in same district 2.7 4.3 2.9 14.8 4.9
2.8 Large wholesaler in different district 0.1 3.5 0.8 9.7 2.3
2.9 Supplier (broker) locally 1.2 8.6 6.9 0.6 5.4
2.10 Supplier (broker) in same district 0.3 0.0 0.0 0.0 0.0
2.11 Supplier (broker) in different district 0.0 0.0 1.8 0.0 1.2
2.12 Supermarket 0.0 0.0 0.0 0.0 0.0
2.13 Auctioned locally 16.3 5.4 1.9 0.0 3.4
2.14 Auctioned in same district 0.1 1.1 5.3 0.0 3.6
2.15 Auctioned in different district 0.2 0.6 0.1 0.5 0.2
2.16 Others 0.1 0.0 0.0 0.0 0.0
2.17 Total 100 100 100 100 100

Source: IFPRI/MSU Fish Value Chain Farm Household Survey, 2014.

12.4.2.4 Rise of the Fish Trader Segment to Urban Areas

Growth in sales of farm output has been accompanied by a proliferation 
of traders in the midstream segment of the chain. As urban demand has 
grown and the road network has developed (Table 12.3), fish is increasingly 
sold by traders in the zones of production to Dhaka, and from one division 
to another. The national Household Income and Expenditure Survey, (BBS 
2011) shows that from 2000 to 2005 the share of fish consumed in urban 
areas rose from 29 percent to 42 percent.

The conduct of the segment has also changed from the traditional image 
common in Asia that traders are advancing funds to farmers to “lock in” 
farmers in transactions. Our survey shows that none of the farmers received 
any cash advance from fish traders. That is confirmed by the present trader 
survey. But the trader survey shows that around 40 percent of traders, both 



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 437

rural (operating from villages) and peri-urban (operating from secondary 
cities or towns), provide advances of working capital to other traders in 
order to secure supplies of fish, with an average loan duration of just under 
one month.

Among rural and peri-urban traders, our survey shows that the great 
majority have stalls in rural and peri-urban wholesale markets. Most 
rural fish traders (63 percent) and peri-urban traders (79 percent) take 
a commission on the transaction of fish (rather than through arbitrage 
where they buy and then sell). None of the rural traders and few of the 
peri-urban traders surveyed own trucks, and only 6 percent rent them, 
indicating their role as intermediaries who operate from a base and just 
link buyers and sellers, relying on hiring transporters (or having the farmer 
hire transporters to deliver). The average monthly working capital of rural 
traders is a little under half that of peri-urban traders as expected.

Few traders (<2 percent) own ice making plants, and almost none owns 
a cold storage. Only 31 percent of rural and 20 percent of peri-urban traders 
report icing the fish. This likely reflects their role as commission agents, who 
rapidly broker sales between buyers and sellers, without taking possession 
of the fish themselves, with buyers usually assuming responsibility for 
procuring ice from ice suppliers or manufacturers. The low ice use rate 
is not for lack of access to ice firms: 80-90 percent of the traders feel they 
have good access to ice firms. The domestic market demands whole fresh 
fish, with little, if any value addition occurring. It is thus not observed that 
wholesalers, feed companies, or hatcheries process their own fish.

12.4.3 Technological cum Product Composition/Product Cycle Change 
and Patterns

Important inter-linked changes have occurred in the technologies and the 
product composition of farm production concurrent with the above structural 
changes in the value chain. We discuss these below.

12.4.3.1 The Product Cycle

The “product cycle” is a widely observed feature of product development in 
many sectors of the economy, and can be observed for a range of agricultural 
sectors, including fish and fruit, in a number of other countries. Sequentially, 
the stages of the product cycle are: (i) local niche product stage; (ii) commodity 
stage, during which a local (or exotic) niche product is “commoditized” by 
production in large quantities, driving down costs, but with little product 
variety or quality differentiation; (iii) product differentiation stage: when 



438 Securing Food for All in Bangladesh

the commodity becomes differentiated along the lines of several possible 
tangible and intangible attributes (e.g. variety, quality, organic versus 
conventional, confined versus free range); (iv) commoditization stage, where 
the differentiated products are themselves produced on larger scale and 
commoditized, and; (v) introduction of new niche or differentiated products. 
The cycle can continue indefinitely depending on the capacity of innovation 
in the sector and the market.

We posit that the Bangladesh fish sector has followed a typical “product 
cycle” development path, facilitated by the linked technology changes along 
the value chain described above, although to date only the three stages can 
be discerned. The first (and ongoing) technology change linked to the first 
product cycle step (moving from niche to commodity) is the shift from 
capture of wild fish stocks from open waters, to their production in ponds 
under controlled conditions. This shift began in earnest during the 1980s, 
as ponds were increasingly utilized for aquaculture, primarily by stocking 
native carp species which were an important component of inland capture 
fisheries at that time (Ali 1997).

Carp cultivation expanded rapidly from the 1980s onwards, as hatcheries 
produced seed of both indigenous carps (e.g., rohu)—formerly a highly prized 
but infrequently accessible “local niche” product—and exotic carps (e.g., 
silver carp) became more widely available, leading to their commoditization.

In the mid-1990s, pangasius, an exotic (to Bangladesh) catfish, was 
introduced from southeast Asia (where it itself had originated as a local 
niche variety that had been commoditized). Pangasius was well suited to 
commoditization under intensive farming conditions due to its fast growth 
and hardy physiology (including the ability to breath atmospheric oxygen), 
which equate to good survival rates, and the ability to survive at high stocking 
densities. Production of pangasius grew rapidly in Bangladesh from the late 
1990s onwards, with the product commoditizing as supply increased and 
real prices fell (Ali, Haque, and Belton 2013).

Widespread production of monosex Nile tilapia seed began in the 
early 2000s, facilitating its rapid uptake by farmers and commoditization.4 
Tilapia, which originates from Africa, has also shifted from being a local 
(African) niche product to a commodity with a pan-global distribution over 
the past 50 years. It was introduced into Bangladesh from its commoditized 

4 The introduction of hatchery technology needed to produce ‘monosex’ (all-male) tilapia 
seed was a necessary precursor to the commoditization of tilapia. All-male populations of 
tilapia do not breed, and grow quickly and to large sizes, whereas mixed-sex tilapia breed 
precociously, expending energy on reproduction rather than growth. This results in many 
stunted fish with low market value (Belton 2012).



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 439

base in Southeast Asia (Belton and Little 2011). Although tilapia is not an 
air breather like pangasius, its fast growth, ability to tolerate high stocking 
densities and poor water quality, adaptability to a range of diets, and 
suitability for use in a wide range of food preparations, all make it an ideal 
candidate for intensification.

From the late 2000s there has been a further wave of farm production of 
native fish species such as climbing perch (koi in Bangla language), walking 
catfish (magur), stinging catfish (shing), feather back (chitol), and butterfish 
(pabda) which were formerly available only from domestic capture fisheries. 
Climbing perch farming in particular has already undergone rapid expansion 
of intensive production for the mass market, resulting in full commoditization. 
Climbing perch, a popular wild fish in Bangladesh, is, like pangasius, an air 
breather capable of surviving at high densities under conditions of poor 
water quality. The strains raised in Bangladesh at present were imported 
from Thailand and Vietnam and are faster growing and larger than the native 
wild strain. It is likely that one or two of the species in this niche group will 
also eventually become fully commoditized, and may subsequently spread 
to other countries as pangasius, tilapia, and improved climbing perch strains 
have to Bangladesh.

Data from BIHS depict on the consumption side the product cycle (Figure 
12.1). After becoming commoditized during the 2000s, pangasius and tilapia are 
now the first and third most consumed fish in rural areas of Bangladesh. Rohu, 
an indigenous carp species that was among the first fish to be commoditized, 
and traditionally the most important farmed fish, is now ranked fourth in terms 
of consumption. The very recently commoditized climbing perch now ranks 
eighth. This change has occurred quickly. Comparison with similar household 
survey data collected in 2006-2007 shows rohu still the most consumed fish 
at that time, with pangasius third, tilapia ninth, and climbing perch not yet 
produced in sufficient quantities to feature (Belton, van Assledonk, and 
Thilsted 2014).

Our farm survey also shows evidence of product cycle changes in each zone 
in 2008 compared with 2013. There is a significant increase in production 
of pangasius, tilapia, and “niche” species in the North, and niche species in 
the East. Overall, carps are the dominant category of fish species produced in 
the study zones. However, the share of carps has decreased slightly (2 percent) 
while the share of pangasius has increased significantly (7 percent increase), 
as has tilapia to a lesser degree (3 percent increase). It is interesting that the 
production of niche species has increased slightly in the study zones, but in 
the North increased by 72 percent, and in the East increased 16 times, though 
from a low base.



440 Securing Food for All in Bangladesh

Figure 12.1: Average Weekly Consumption Per Capita of Ten Most Consumed Fish 
Species in Rural Bangladesh

Pe
rc

en
ta

ge
 o

f f
ar

m
er

s

Q1 Q2 Q3 Q4 Q5

0

5

10

15

20

25

30

35

40

45

50

Pan
ga

siu
s*

Silv
er

ca
rp*

Til
ap

ia*

Roh
u* Puti Ta
ki

Mrig
al*

Drie
d

fis
h

Clim
bin

g
 pe

rch
*

Shri
mp

Hils
a

Note: Q1 = Expenditure quintile 1, etc.; Fish marked with an asterisk are produced predominantly 
from aquaculture. Source: Derived by authors from the BIHS data.

Table 12.13: Aquaculture Production by Fish Category, 2008 and 2013

Zone Southwest South-center North East Total

2008 2013 2008 2013 2008 2013 2008 2013 2008 2013

Production (kg/year)

Carps 173 175 235 325 521 928 233 369 291 445

Tilapia 58 71 60 99 182 503 169 309 116 244

Pangas 0 0 66 105 544 1,358 103 207 180 401

Shrimp 129 134 7 8 0 0 12 7 48 51

Niche 46 45 58 69 186 408 18 285 172 200

Others 42 46 60 70 92 216 94 137 70 117

Total 448 470 485 675 1,525 3,414 630 1,314 876 1,458

Share of production (%)

Carps 39 37 49 48 34 27 37 28 33 31

Tilapia 13 15 12 15 12 15 27 24 13 17

Pangas 0 0 14 16 36 40 16 16 21 28

Shrimp 29 28 1 1 0 0 2 1 5 3

Niche 10 9 12 10 12 12 3 22 20 14

Others 9 10 12 10 6 6 15 10 8 8

Source: Fish Value Chain Farm Household Survey 2014.



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 441

12.4.3.2 Capital-led Intensification

The conventional image of the pond-fish sector was once millions of backyard 
“homestead ponds”, utilized primarily for subsistence (home consumption). 
Dey, Bose, and Alam (2008, 13) refer to aquaculture in Bangladesh as a “low-
input activity for household consumption”.

However, the small and medium commercial farms that now dominate 
aquaculture output are making a transition from the traditional production 
technologies toward intensification—first by labor and then by productive 
capital (such as formulated feed and medicines and some equipment such 
as aeration). The main technology changes observed in the survey are as 
follows.

Rapid increase of purchased feed and seed. Use of wild fish seed has 
been replaced by use of hatchery produced fish seed. Jahan et al. (2015) 
report that less than 4 percent of farmers use fish seed from open-water 
sources. Seed stocking density has also increased. Our farm survey shows 
that nominal expenditure on fingerlings per hectare more than doubled 
between 2008 and 2013.

Moreover, there has been a transition in zones surveyed from no use of 
feed, to use of feed inputs available on farm, to use of hand-made feeds made 
with ingredients purchased off-farm, to use of purchased manufactured 
feeds, formulated to meet the complete nutritional requirements of the 
fish produced and, increasingly, from formulated sinking feed to floating 
formulated feed. The latter allows for greater production efficiencies via 
reduction of waste and higher digestibility.

Strikingly, our farm survey shows that 38 percent of farmers in 2013 
used commercial pelleted feeds, up from 30 percent in 2008; both figures 
are surprisingly high, and run counter to the common image of fish farming 
in Bangladesh as mostly extensive or semi-intensive (ADB 2005). Use of 
commercially manufactured pelleted feeds is significant because their use 
can increase fish growth rates, facilitating higher yields, and is consistent 
with product cycle driven diversification into species of fish (e.g., pangasius, 
tilapia, and climbing perch) that require formulated diets to attain optimal 
growth.

Our survey results show that use of other supplementary feeds usually 
associated with semi-intensive farming (e.g., rice bran, mustard oilcake), 
was already widespread in 2008 (60 percent of farmers), but grew to 69 
percent of farmers by 2013. This indicates a range of stages of intensification, 
with some farmers shifting from extensive to semi-intensive production 
and others “upgrading” to more intensive production with pelleted feeds.



442 Securing Food for All in Bangladesh

Rapid increase in the use of chemicals. Use of medicines and other 
chemicals, including lime, antibiotics, salt, fungicides, insecticides, and 
feed additives such as vitamins have increased in line with higher stocking 
densities and feed use. This has occurred as the incidence of disease has 
increased and better management has been necessary to maintain water 
quality within the parameters required for fish survival and growth (Ali, 
Rico, Jahan, and Belton 2016).

Our farm survey shows that use of lime for pond preparation was already 
a widespread practice in 2008 (63 percent of farmers), and was adopted by 
73 percent by 2013. Use of medicines and vitamins was less common (6 
percent of farms each in 2013), increasingly slightly from 4 percent in 2008. 
Use of both these inputs was greatest in the North reflecting its intensified 
technology, and lowest in the least commercial zone, the East.

Increase of use of hired labor. Hired labor use has increased along with 
the overall need for labor. Whereas in the early 1990s aquaculture used 
little household labor as compared to crop or livestock cultivation (Ahmed, 
Rab, and Bimbao 1993), commercial forms of aquaculture in Bangladesh 
now generate higher average demand for hired labor per unit area of land 
than paddy cultivation, due in part to the long fish cropping cycles (Belton, 
Ahmed, and Jahan 2014) and more yield and input use to manage.

Our farm survey data show that both total labor inputs (measured in 
value terms, as the imputed value of the wage rate for family labor and the 
cost of outlays on hired labor), and inputs of hired labor have intensified 
per unit of (pond) land. The total outlay per hectare for labor (family plus 
hired) in 2013 was 1.6 times what it was in 2008. The share of hired (non-
family) labor in total labor (hired plus own labor) doubled over the same 
period, from 11 percent to 21 percent.

Hiring labor was concentrated among a small subset of commercial 
farms. The share of farms hiring casual workers was 16 percent for pond 
preparation; 5 percent for stocking, 5 percent for the post-stocking/
growing-out stage, and 6 percent for harvesting. The share of farms hiring 
salaried or permanent laborers is still much lower. Moreover, differences 
in total labor inputs and in hired labor vary markedly across zones, in line 
with patterns of intensification. Total labor use in 2008 was 50 percent 
higher in the South-center and North than in the Southwest and East. By 
2013, these differences are even more extreme, with labor use per hectare 
in the South-center and North 100 percent higher than in the Southwest 
and East.

Rapid increase/investment in quasi-fixed capital (equipment). There has 
been substantial investment by fish farmers in productive capital. Investments 



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 443

(at nominal terms) in assets used for fish farming5 jumped by 235 percent 
over 2008-2013. The rate of investment is similar over all zones, with the 
exception of the South-center, which is somewhat slower. However, the 
rapid jump in productive fish-related capital holdings masks the fact that 
few fish farms had these. Pumps, owned by 14 percent of households, 
were by far the most frequently owned item. Investment growth is thus 
from a relatively concentrated base among the small/medium commercial 
farms. The money value of the stock of quasi-fixed capital inputs (rate of 
investment in capital) on fish farms rose faster than labor flow (total use of 
labor, measured in value terms) from 2008-2013.

Investment in agricultural equipment by fish farmers is reflected in 
productive capital stocks used for crop farming increasing by 185 percent. 
This too was similar across zones. Fish farmers also invested in livestock 
(increasing by 533 percent), while non-farm productive assets climbed 730 
percent, and consumer durables by 240 percent. Even discounting these 
rates for inflation, these findings show that fish farmers are a vibrant capital 
accumulating segment.

Table 12.14: Fish Farm Capital to Labor Ratio by Zone, 2008 and 2013

Item South-
west

South-
center

North East All

Capital/labor ratio, 2013 1.52 0.39 0.63 0.48 0.75

Capital/labor ratio, 2008 0.96 0.33 0.47 0.32 0.51

Change, 2008 to 2013 (%) 58 18 34 50 47

Source: Fish Value Chain Farm Household Survey 2014.

In sum, from 2008 to 2013 there has been a remarkable increase in use 
of external inputs by farms. Total outlay on external inputs (feed, fertilizer, 
chemicals and so on) tripled per hectare. The rate of external input use did 
not differ a great deal across three of the four zones. Average expenditure 
on inputs was much greater in the North however, reflecting the intensive 
technologies utilized there.

Despite the rapid increase in total outlay on external inputs, the 
composition of that outlay is very stable. Feed remains central, accounting 
for 78-79 percent of external input costs in both 2008 and 2013. Fertilizer6 

5 Assets used in fish farming are calculated by the summation of the value of the following 
assets: pumps, generators, aerators, nets, weighing scales, boats, bicycles, motorcycles, pickup 
trucks, trucks.

6 Fertilizer is used to induce growth of phytoplankton in the pond, which provides a natural 
feed for fish.



444 Securing Food for All in Bangladesh

stays at 5 percent; fuel 7-8 percent; and pesticide and lime 5-6 percent. Fifty 
percent of farmers (with a lower share in the East) use chemical fertilizer 
in the pre-stocking phase, up sharply from 39 percent in 2008. Use of other 
inputs also increased: 75 percent of farms use lime for pond preparation 
in 2013, up from 63 percent in 2008, and a third uses water pumps for 
filling the pond in 2013, up from one fifth in 2008, both indicating greater 
attention to maintenance of good water quality. In combination, these 
trends all point to a broad shift away from “traditional” low input forms of 
production, with capital intensification in the farm sector occurring in step 
with rapid growth, diversification and technological change in the feed and 
seed value chain segments.

12.4.4 Mirroring of Farm Capital-led Intensification: Growth and 
Technological Change in the Input Supply Segments

Capital intensification in the farm sector has occurred in steps with 
rapid growth and diversification in upstream value chain segments, most 
importantly feed and seed. As noted in Section 12.1, there has been a 
proliferation of feed mills, but overall a concentration of production in larger 
mills. Larger feed mills have multiple lines, and differentiate feed types for 
different fish species and age groups, by protein content, complementing the 
species differentiation taking place on farms and in hatcheries, in line with the 
product cycle. The most recent shift in feed mill technology has come about 
through the use of extrusion machinery to produce feeds that float instead of 
sink, providing further product differentiation, and offering efficiency gains 
to producers. Mamun-Ur-Rashid, Belton, Phillips, and Rosentrater (2013) 
find that from 2008 to 2012, production of formulated fish feeds almost trebled 
from 360,000 tons to an estimated one million tons. The share of floating feeds 
in total formulated feed production grew from less than 5 percent to close 
to 20 percent. The extrusion equipment used to manufacture floating feed 
represents a major investment. The size of mill and adoption of extrusion are 
closely correlated, and big mills dominate the floating feed supply. This factor 
may result in further concentration in the industry over time. The growing 
use of formulated feed has also seen rapid expansion in the number of fish 
feed dealers (both wholesalers and retailers) as noted in Section 12.4.1, and 
veterinary chemical/medicine input retailers.

Technological shifts have also occurred within the seed supply segment 
of the value chain. The product cycle is observed in hatcheries, mirroring 
farm production: The share of hatcheries reporting carps to be the most 
important species sold fell from 59 percent to 45 percent over 2008 to 2013, 
while the share of hatcheries reporting pangasius and tilapia (combined) as 



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 445

their most important species rose from 15 percent to 20 percent, and the 
share of “niche” species jumped from 11 percent to 26 percent.

12.4.5 Reflections on the Policy Determinants of the Transformation
The government has played an important role in the early stages of some 
off-farm value chain segments. For instance, the first fish feed mill in 
Bangladesh was established in Mymensingh by SABINCO, a joint venture 
investment company owned by the Governments of Saudi Arabia and 
Bangladesh. This arguably provided proof of concept for private investors. 
The government has also played a role in the hatchery sector. For instance, 
Bangladesh Fisheries Research Institute (BFRI) in Mymensingh was 
central to the development of pangasius and koi farming by establishing 
and disseminating spawning protocols for both species, and importing 
pangasius brood from Thailand. Several universities and a large number of 
colleges offer fisheries and aquaculture degrees, providing graduates to the 
private and NGO sectors.

Other than these types of investments, sector specific policies and 
regulations have had little effect for the most part. There are laws intended 
to govern both the hatchery and animal feed sectors, but these are 
widely recognized to be poorly enforced. There has been, however, some 
continuity in the pro-business outlook of consecutive governments, despite 
frequent political instability. Policies friendly to foreign direct investment 
help to explain the high level of foreign ownership in the feed mill sector. 
However, the cost of doing business in Bangladesh is high, and this likely 
contributes to the high level of informality among small and medium-sized 
enterprises (SMEs). Similarly, legal recourse to contractual enforcement is 
poor, which again is likely to account for the predominance of informal 
trust-based coordination between value chain actors, in preference to formal 
contractual relations.

Despite Bangladesh’s highly developed NGO sector, and large number 
of NGO-led aquaculture programs implemented over several decades, it is 
notable that NGOs have played a rather limited role in the development 
of the aquaculture value chain in Bangladesh, with the biggest impacts 
derived from the earliest projects, before “take-off” had occurred.

Nonetheless, successive governments have invested in infrastructure (rural 
roads, water management schemes, power generation). Telecommunications 
also grew following the sector’s liberalization. These have likely been the most 
important non sector-specific policy changes. Agricultural land is privately 
owned and the government adopts a laissez faire approach to land use (e.g., 
there are no regulations in place on the type of crops that must be produced 



446 Securing Food for All in Bangladesh

on specific types of land). This in part accounts for the rapid growth of ponds, 
as fish farmers have been unencumbered by such restrictions. Microcredit 
provided mainly by the vibrant NGO sector is abundant, but is rarely 
invested in fish farming due to insufficient loan sizes and inconvenient loan 
repayment schedules. Growth of off-farm employment opportunities has 
likely fueled investments in fish farms through savings, but it is difficult to 
pinpoint a specific responsible policy, other than some of the general ones 
that similarly affect investments in fish farms.

12.5 Conclusions
The study has produced a single, powerful finding: the fish value chain in 
Bangladesh is growing and transforming very rapidly, in all segments. The 
quiet revolution in the fish value chain is a domestic market revolution. 
Dynamism of the aquaculture value chain in Bangladesh is shown in two 
inter-linked ways.

First, there has been a tripling of volumes and actors in all the segments 
of the value chain over the past decade. Second, there has been rapid capital 
deepening in the form of investments by hundreds of thousands of actors 
in the fish value chain; apparent in a great jump in feed use, investment in 
equipment and pond construction, and investments in mills, hatcheries and 
vehicles. These investments have been made by, and provided opportunities 
for, a multitude of smallholder farmers and small and medium enterprises 
throughout the chain.

Second, there has been diversification and specialization beyond carps 
into production of commercial species such as tilapia and pangasius catfish, 
which have raised yields and helped to move the fisheries sector along the 
“product cycle.” One important positive externality of this process has been 
a reduction in the price of farmed fish over time, making an important 
contribution to food security.

This growth has been oriented towards the domestic market, as very 
little of Bangladesh’s farmed fin-fish is exported. Unlike in the global 
value chain literature (which deals primarily with changes in value chain 
organization and conduct associated with adoption of standards and 
contracts driven by buyers and NGOs in developed country markets), we 
identify very little change having taken place as a result of the imposition 
of standards and contracts.

Policy has played some role in facilitating this growth, in particular 
through early investments in fish seed production, as well in electricity 
and road infrastructure in rural areas. A laissez faire policy in terms of 
crop choice has also been important. However, the direct influence of 



The “Quiet Revolution” in the Aquaculture Value Chain in Bangladesh 447

government and NGOs in “causing” this quiet revolution has been relatively 
minor in comparison with the investments of millions of farm households 
and small and medium enterprises. Policies and investments that support 
a broad enabling environment for a wide variety of businesses (e.g., rural 
infrastructure development and minimization of regulatory constraints 
to enterprise start up and growth) will generally be of greater importance 
than those that aim to solve sector or segment specific problems. This can 
include things that government does not do, as much as those that it does 
(e.g., not restricting conversions of agricultural land to ponds).

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