Umesh Waqil, from Vidarbha in Maharashtra, was one of the many farmers
who spent sleepless nights in March 2012. The reason was money. He had sold a
large quantity of tur dal (pigeon pea, a type of pulse) on credit to first-time
buyer Tata Chemicals, and now he was worried about whether he would get his money
Vidarbha is an arid region; in summer the earth is hot and dry and there are few leaves on trees. As much as 90 percent of the crops are rain fed; when the monsoons are late or scant, the crops fail and farmers face the brutal prospect of eking out a living until the next planting season. But it’s not just the fickle weather that families dependent of agriculture here have to contend with.
The majority of farmers in Vidarbha are at the mercy of unscrupulous traders and, even worse, moneylenders, which explains a suicide rate that has become a national shame, with thousands preferring death to debt and grinding poverty. But that is changing with a little support from the Sir Ratan Tata Trust, the Navajbai Ratan Tata Trust and the Sir Dorabji Tata Trust.
For the farmers of Vidarbha, not receiving payment for their produce is a life-and-death situation. Mr Waqil’s worries were greater than most because he is one of the representatives of his village dealing with the Wardha Cotton and Soya Producer Company (Wardha PC), a farmers’ organisation set up in December 2011 in Wardha, one of Maharashtra’s most distressed agricultural districts. A producer company is a new kind of entity being promoted by the Indian government to cut out middlemen, bring small farmers and agricultural cooperatives closer to the marketplace and improve the prices they get for their produce.
When Tata Chemicals, which markets the i-Shakti brand of pulses, approached the Wardha PC in March 2012 to procure tur dal, the terms it offered were generous — at about Rs3,600 for a quintal (100kg), farmers would earn Rs600 more than they would if they used the usual trader channels. But there was a rider: a waiting period of 10 days for the payment. To sell or not to sell was the dilemma faced by the farmers more used to getting cash upfront than selling on credit.
Milieu of mistrust
As the days passed, the community became ever more restless. Mr Waqil received several calls from panic-stricken farmers who talked wildly about suicide, migration and of selling their holdings. “This was a big matter,” Mr Waqil explains. “One group of farmers had to be paid Rs350,000. They were very anxious.”
At risk was much more than the tur dal deal; the new producer company, the farmer-market connect, the chance of better prices for farmers — all of these were at stake as the farmers counted the days. And the days went by.
On the last day, though, the amount came through. Mr Waqil and the other directors went to each farmer’s house to deliver the money and the good news. “We woke them up at 1am and handed over the cash. Farmers who had lost hope were so happy after the many days of tension and despair; it was a spectacle worth seeing.”
The success of the tur dal transaction marked a turning point for the Wardha PC. The attitude of the farmers towards the company changed and now there is greater trust as the PC works to get better prices for other crops.
The price of produce
SBI was launched as a reaction, and a response, to the suicide deaths of more than 17,500 Indian farmers between 2002 and 2006. Maharashtra accounted for some 4,000 of these tragedies. In 2006, a shocking 1,044 suicides were reported in Vidarbha alone, mainly because of the fall in the minimum support price being offered for cotton.
The same year, Indian Prime Minister Manmohan Singh announced a Rs37.5-billion relief package for Vidarbha. In 2009, the Maharashtra state government initiated a programme known as the Convergence of Agricultural Interventions in Maharashtra (CAIM) programme with the support of the International Fund for Agricultural Development and the Tata trusts. Since the end objectives of SBI and CAIM were similar, the two initiatives converged and today the SBI-CAIM programme has a total outreach of 286,000 households across 1,200 villages in Vidarbha.
“The goal of SBI-CAIM is to contribute towards the development of resilient production and sustainable and diversified household incomes through on-farm and off-farm livelihoods,” says Amitanshu Choudhary, an assistant development manager with the Sir Ratan Tata Trust and the Navajbai Ratan Tata Trust. “This will enable households to face production and market-related risks without falling back into poverty and distress.”
The primary objective of the initiative is to help farmers in Vidarbha earn more. The three components of SBI-CAIM are market development and linkages, enhancing crop production through improved and sustainable agricultural practices, and microfinance support and promotion of micro enterprises.
The market development initiative has been quite successful in Wardha district. It was initiated in September 2008 by helping farmers from 25 villages form producer groups. The main activities under this are agriculture and business development services, dairy services, institutional development services and financial support.
SBI-CAIM is aiding the creation of community-based, multipurpose cooperatives and PCs to market farmer produce as a collective. In the case of the Wardha PC, for instance, SBI-CAIM helped farmers form 340 producer groups that collectively formed a non-registered body known as the Kisan Samruddhi Kendra; a representative from each group stood for election and, in the end, 50 of these representatives became board members of the Wardha PC.
Dnyaneshwar Dewane, one of the elected board members of the Wardha PC and the Chakachak Shetkari Utpadak Gut, started a pulse mill through the producer group last year in Kavtha village. The mill purchased 20 quintals of tur dal, processed it into dal and sold it at a rate that was higher by Rs15,000.
“The nearest dal mill was 15km away; by setting up this mill, farmers no longer need to transport their stock elsewhere,” says Mr Dewane. “If farmers process their dal before sale, they get an extra Rs600 per quintal. Some farmers also graded their dals, for which they got profits that were higher by around Rs800 per quintal.” An added benefit is that PC members get a discounted rate for milling their pulses.
A second mode of intervention is helping farmers shift to sustainable agricultural practices, such as reducing the use of chemical pesticides. SBI-CAIM has developed an integrated pest management (IPM) model for Vidarbha with help from the Dr Panjabrao Deshmukh Krishi Vidyapeeth, Akola (PDKV). The project involves advising farmers in the adoption of IPM technology, from the choice of crop variety, seed treatment, sowing and identification of pests to regular surveillance of fields and the judicious use of pesticides. This is done through the guidance of krishi doots — trained village-level workers — and progressive farmers.
Another component of IPM is setting up of village information centres where farmers can get information about pest management in Marathi, the local language. The project is seeking to develop, with the help of PDKV, 20 demonstration plots in 10 villages of Akola district into knowledge centres for farmers.
Ranveer Kavde farms in Yeoti (Yavatmal district), where farmers used to add too much pesticide to their crops — a waste of money and a cause of soil pollution. Says he, “Earlier, we did not know how much pesticide should be used for our cotton crop. Now that we have been trained, we go to the village and tell other farmers how a particular pest affects the crop and which pesticide can save it.”
This is an outcome of the microfinance component of SBI-CAIM’s work, which helps in the promotion of self-help groups (SHGs), federations and producer groups. Ms Chimankar says that there are 70 SHGs in her village, which run businesses like making and selling saris, cutlery and slippers.
SBI-CAIM is directly involved in helping micro-enterprises thrive by providing inputs in planning, bookkeeping, and by holding regular meetings. Satyabhama Ashu Hingle, who has a slipper business, says, “We invested Rs20,000 initially and have earned a lot in profits ever since. The help we received from the initiative has not only made us stronger financially but has also improved our knowledge of doing business.” Many of the SHGs are now planning to take loans, not from banks but from government schemes that offer funds at lower interest rates.
SBI-CAIM also works to provide support to distressed families and vocational training for school dropouts. In several ways, hundreds of farmers’ lives have been touched for the better. For Vidarbha, this just could be the beginning of a journey of hope and revival.