Management of Agri-Business Contracts and Organizations
Agri-business organizations and the contracts therein tend to be complex as they require close coordination between isolated agricultural farms in the backward linkage component, on the one hand, and agro-processing and marketing operations in the forward linkage component, on the other. These organizations have undergone further changes in their structure and functioning under pressure of liberalization and globalization, while taking advantage of the advancements in theories of property rights, agency theory, corporate governance, stakeholder cooperation, etc. This book makes a modest attempt to bring out these internal organizational changes with the help of two crisp but intensive case studies of two contrasting agri-business organizations, though both are engaged in delivery of credit in rural India. The first case pertains to primary agricultural credit societies in a cooperatively vibrant area – namely, Gandevi Taluka in Navsari district of South Gujarat, with their emphasis on both input and output marketing, besides agro-processing alongside credit operations. The second case pertains to the rural credit operations of BASIX, a special type micro-finance institution, which combines the virtues of a 'for profit' company with those of a non-profit livelihood school, and has thus taken a broader developmental approach towards rural credit for vulnerable sections of the community. As credit cannot stand alone – that is, can't sustain itself in isolation from related markets and in the absence of appropriate institutional structures, this study not only demonstrates application of modern organization management tools in agri-business operations around credit, but also provides important clues toward improving performance of credit in this country.
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