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Building Forward with Farmers, Finance & Future Markets

Profile
Bijon Islam
July 31, 2025
Building Forward with Farmers, Finance & Future Markets

This letter was originally sent to LightCastle Bimonthly Newsletter subscribers.

Over the past decade, Bangladesh has made major strides in economic growth and export diversification but one sector still holds untapped potential: agriculture. Despite employing over 40% of the workforce, agriculture contributes just 12% to GDP. The sector faces several bottlenecks, fragmented value chains, limited access to finance, poor post-harvest infrastructure, and rising climate risks

But with the right mix of interventions, agriculture can evolve from a subsistence activity into a high-growth, high-impact sector that creates jobs, drives exports, and improves rural incomes. At LightCastle, we believe the time to rethink agri-development is now. Here’s how we can unlock the opportunity.

From Production to Value

To move the needle, we must shift from a production-first mindset to a value chain approach. That means:

  • Supporting farmer cooperatives and digital platforms to aggregate supply and demand
  • Investing in rural infrastructure, cold storage, warehousing, and transportation
  • Promoting agro-processing in areas like dairy, fruits, jute, and spices
  • Strengthening linkages between farmers, processors, retailers, and exporters

Agri-SMEs and startups also play a key role here. With the right support, they can drive innovation, reduce post-harvest losses, and introduce climate-smart practices. Digital agri-tech, traceability tools, and climate-resilient inputs all need to scale.Financing the Ecosystem

Access to finance remains one of the biggest challenges. Traditional agri-lending often doesn’t align with seasonal cycles or value chain realities.

Innovative models can bridge this gap:

  • Value Chain Finance: Loans backed by offtake agreements or stored produce, including digitally enabled crowdfunding
  • Blended Finance: Using catalytic capital like credit guarantees or first-loss coverage to attract private investment into processing or logistics
  • Outcome-Based Models: Linking funding to impact, such as increased farmer incomes or yields, rather than just activities
  • Climate Financing: Expanding indexed crop insurance and climate-resilient investment tools

These solutions can make agriculture bankable for smallholders, processors, and investors alike.Scaling Agri-Exports

The global agri-food market continues to grow and Bangladesh has a competitive edge in products like mangoes, shrimp, aromatic rice, Hilsa, and jute composites. 

But export volumes remain low due to compliance gaps, packaging issues, and weak trade facilitation.

To compete globally, we need:

  • Export-oriented agri zones with streamlined logistics and customs
  • Better certification infrastructure and quality labs
  • Investment in branding and buyer linkages

Countries like Vietnam have done this successfully Bangladesh can too.Looking Ahead

To make this shift happen, three steps are critical:

  1. Launch a national agri value chain strategy, co-designed by public and private stakeholders
  2. Establish an agri-innovation and blended finance platform to fund catalytic ideas and ventures
  3. Build export readiness through quality, compliance, and branding support

Final Thoughts

Agriculture doesn’t just feed the nation, it can also fuel its growth. With the right mix of value chain efficiency, financing innovation, and export readiness, Bangladesh can turn agriculture into a 21st-century success story.


Profile
WRITTEN BY: Bijon Islam

Bijon is the co-founder and CEO of LightCastle Partners, an organization that focuses on creating data-driven opportunities for growth and impact for development partners, corporates, SMEs, and Startups. Over the last ten years, Bijon has led the company in engagements across 150+ businesses/development partners, 650+ SMEs/Startups, and 40+ accelerator programs in multiple industries including Technology, Agriculture, Health, Ed-tech, Energy, E-commerce, Logistics, and Manufacturing. Previously Bijon has worked with Citibank, N.A. and Citi Foundation and oversaw the execution of Bangladesh's first Interest Rate Swap, Equity Convertible Bonds, Largest IPO, Microfinance Securitization, and Block Equity Trades. Due to outstanding performance, Bijon received the CEO Excellence Awards for two years in the organization. He completed his BBA and MBA from the Institute of Business Administration (IBA), University of Dhaka.

For further clarifications, contact here: [email protected]

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