Thanks for your comments! I was going to post the points below in a comment but just wanted to make sure it got a wider reading.

What can we learn from the Malawi article? The state was facing a food shortage, it went against the advice of the international development community, provided steep subsidies (one third of market price), and in two years the farmers virtually tripled their output in the presence of favorable weather. The article does not tell us about the rate of subsidies in Malawi in previous years, let alone why and how subsidies worked so well this time. Nor do we find out much about how the fertilizers were distributed. But given that we too are facing a potential food shortage, I thought Malawi could provide us with a useful lesson in the sense that when farmers are given what they desperately need, the results can seem miraculous. The title ofmy post was basically a description of the NYT piece and what happened in Malawi rather than an outright recommendation for Bangladesh. It is entirely possible that our subsidies are steep enough already but there are other inefficiencies at work that are causing problems for farmers.

As far as the Bangladesh situation is concerned, I know woefully little. So, here are the questions that I have. Some of these have been already raised:

1. What are the current level of subsidies and do we actually need more or less subsidies? I too have read about subsidies being inefficient, and direct transfers being better in a strict theoretical sense in my early years of grad school, but does that work on the ground in Bangladesh? What are the intervening factors? It is a fact that subsidies are a mainstay of the relationship between the agriculture lobby and governments in Europe and the US. Why do subsidies persist if they are so inefficient? This is where politics seeps into economics pure and simple. Malawi was advised to reduce subsidies but it went against the tide. How did that work out so favorably for them?

2. How does the fertilizer market work at the international and local levels (international production and prices, current import rates, local demand, credit and domestic distribution systems in particular)? Is the current system better or worse than the previous ones? We lack basic descriptive data on this. Newspaper reports are piecemeal at best.

3. Variation in demand/ protests over time and space: Is the crisis actually worse this year than all the previous years in terms of fertilizer provision? Is there variation across the country in farmer protests? What is the variation in terms of needs and how well those needs are met? Are certain areas faring better than others? If so, what factors are at work?

Like I said I know far too little to comment knowledgeably. As for the smuggling I’m pretty sure I read a few weeks ago that fertilizer was going to Burma in an article on smugglers being caught in Chittagong… presumably there was profit to be made because prices were higher there at the time.

The fertilizer crisis is not new. I have been reading newspapers since 1991 for my own work and it comes up pretty much every year. Farmers have been protesting, often violently, over the past decade and half at least. In the past the issue was politicized and whatever government was in power was blamed.