Fixed deposits of grain help villagers keep off debt

From the article in - The Hindu Business Line - Life supplement - Sarada Lahangir - Jan 26, 2012

In Koraput district, Orissa, half the population are tribals and working as agriculture labour.  Any mishap, a death, crop failure was leading to debt and bondage.  It was the initiative of a social activist Bidyut Mohanty who established a grain bank to help out the villagers.

Mohanty heads the NGO Society for Promoting Rural Education and Development (SPREAD) - and after consulting with the villagers,  set up the grain bank.  Each household contributed 3-5 kg of paddy and ragi. And the organisation contributed an equal or greater amount. 

Self Help groups managed the grain banks.  Excess stock was sold in the open market and the proceeds invested to earn interest. 

The villagers in two blocks, at present have contributed 33 quintals of paddy and 42.22 quintals of ragi, and SPREAD contributed 198 and 264 quintals respectively.  520 families received loans in the first year.Repayment is always after harvest when the farmers have a disposable income.  The villagers have been able to keep off debt. 

The grain bank has given the villagers a symbol of self-respect and community ownership and brought financial stability to many.  The World Food Bank has recognised the positive impact the grain bank has on ensuring food security and has set up more grain banks in Orissa and Madhya Pradesh. 

Farmer in the News - Mr. R. Subbaian, of Kanakkan Thottam in Coimbatore district.

Excerpts from -The Hindu - January 19,2012 - M J Prabhu

Mr Subbian's field became polluted due to chemical waste seepage from dyeing factories into the river that flowed across his village.  Many farmers started selling their land and moving to cities, since the Government did not adopt any measure to stop the menace.

Mr Subbian stayed back.  He did some research on the crops that could be grown in the soil and heard of Alfalfa and decided to cultivate it.  He also took up multiple cropping to increase his income.  He did this to avoid risk of loss in case on failure of one crop.


The crops are grown organically since he did not have too much success with chemical farming.  He complains that the country is willing to import from the West and they dump us with their produce and are destroying livelihoods of the farmers here. 


He says green revolution is not just about fields turning green.  It should result in prosperity of the farmer.  Only then can it be accepted as a revolution.  The farmer remains poor throughout his life.but a rice mill owner flourishes as well as the cotton buyer.  


India he says no longer lives in the villages, it lives in cities and cramped towns. 

Mr. R. Subbaian at 4/5-A, Kanakkan thottam, A.G. Pudur (P.O), Irugur (via), Coimbatore, Tamil Nadu: 641-103, mobile: 0936-3228039, phone:0422-2627072

‘Food security legislation will add to farmers' woes'

The Hindu Business Line - January 23, 2012

The proposed National Food Security Act will add to the woes of the already suffering farmers of the country, unless the Union Government takes the necessary safeguards before formulating and implementing it, according to Dr Y. Sivaji, the honorary president of the AP Virginia Tobacco Growers' Association.

Dr Sivaji is one of the experts invited by the Union Finance Minister, Mr Pranab Mukherjee, for pre-budget consultations earlier this month. He said he had submitted to the minister that the prime concern of the Union Government would be to rein in the fiscal deficit and therefore, it would tend to keep the foodgrain prices depressed, in view of the huge anticipated financial burden. This would work against the interests of farmers.

Further, he suggested that the loopholes in the present public distribution system should be plugged before implementing the proposed Act. “Never in the history of India have we produced so much foodgrain as we do now, if we consider just one aspect related to the sector. We are expected to record 240 million tonnes of foodgrain this crop year even as our warehouses are overflowing with previous years' stocks. Yet, farmers continue to end their lives in their hundreds, year after year and some of them choose to declare a crop holiday in some areas. The winds of liberalisation have not touched them. The tragedy is that the farm sector is booming even as farmers are sinking,” he observed in a written note to the Finance Minister.

He said the root problem lay in the farmers not getting remunerative prices for their produce. “The costs of production have been spiralling year after year because of the steep increase in prices of inputs and also wages in the wake of implementation of the National Rural Employment Guarantee Scheme. But the MSP for many crops is not remunerative and farmers are not getting even the un-remunerative MSP. There is no institutional mechanism to ensure it,” he noted.

He noted that “the rhetoric of inclusive growth is a cruel joke, as the rural sector is badly neglected. We are sitting on a social volcano which may explode any time. I submit that the Government should not neglect agriculture since it provides livelihood to 63 per cent of our population besides providing food for the entire nation. It supplies raw materials to industry and provides a market for the industry and service sectors.”

REMEDIAL STEPS

He suggested some remedial steps including constituting of Commissions on Agricultural Costs and Prices at the State level, decentralisation of procurement, and linking the MSP to spiralling input costs as is done in Dearness Allowance calculation. The difference between the MSP and recommended cost of the State agencies should be met as bonus by the State Governments. The abolition of all curbs on the marketing of agriculture produce within or outside the country was of utmost importance, he added.

Conversion of crop loans into key (pledge) loans soon after harvesting, strengthening the Agricultural Insurance Corporation, and promoting the seed village concept were some of the other steps that he recommended.

He wanted NREGP implementation to be restricted to the non-agricultural season. Further, he sought FDI in agricultural processing industry, especially in the tobacco sector.He also wanted the development of a farmer's welfare index on the lines of the UNDP human development index.

Maa Thota - for tribal ryots

A scheme promoted by AP Micro Irrigation Corporation and sponsored by NABARD is gaining popularity.  It is aimed at tapping hill springs by micro irrigation techniques. And plantations can be irrigated without using power supply by use of gravitational force of the continuous flow of hill springs.  This ensures regular water supply despite absence of power.  At present, two NGOs Srujana and Vikasa are handling the pilot project and the schemes might be see the light of day by February end.  They will work to educate the tribal farmers and demonstrate the feasibility of the scheme.

A sump will be constructed with a storage capacity of 25000 - 30000 litres at the highest altitude of the hill and water drawn through pipelines.  Drip irrigation systems will be installed.   Water through each sump should irrigate at least 30 acres, benefiting about 10-15 small farmers.  Areas where tribals live are full of perennial hill springs and these provide hope to the farmers who have no access to power.

Why seek retail FDI for cold storage?

The Hindu Business Line - Jan 17 - Shekar Swamy

Instead of handing over our markets and cold chain infrastructure to foreign companies, we can create our own inclusive solution that will be the envy of the world.



The word “reform” is a euphemism for big foreign capital to gain access to Indian domestic markets in a policy framework that is conducive to their success. The announcement on foreign direct investment in multi-brand retail, currently in ‘pause' mode, is one such example.

One of the major reasons cited for such foreign investment is that this alone is the answer to building our nation's cold storage chain, to reduce wastage of fresh fruits and vegetables.

Let us look at two simple low-cost solutions, both of which can be indigenously developed, tested and deployed on a mass scale.


Lesson from Nigeria

This inspiring example comes from the region around Kano, in northern Nigeria, an area characterised by hot days, low relative humidity and low rainfall that is concentrated within three months.

The region is home to a third of Nigeria's population of over 150 million people. The people are mostly small farmers and cattle-rearers. The area suffers from poor roads and power shortage, making cold storage difficult (a description that applies to vast tracts of India).

Consequently, farmers had to sell their produce at low prices, since they could not hold the produce.After studying the problem in depth, Mohammed Bah Abba, an enterprising lecturer at the Jigawa State Polytechnic, Dutse, came up with a unique solution. Hailing from a family of potters, he invented the pot-in-pot system of cooling (calledzeerin local language).

The pot-in-pot technology consists of two earthenware pots of different diameters, one placed inside the other. The space between the two pots is filled with wet sand that is kept constantly moist, thereby keeping both pots damp. Fruit and vegetables are put in the inner pot, which is covered with a damp cloth. The phenomenon that occurs is based on a simple principle of physics: the water contained in the sand between the two pots evaporates towards the outer surface of the larger pot where the drier air is circulating.

The evaporation automatically produces cooling, causing a drop in temperature of several degrees in the inner container, extending the life of the perishable foods inside. In tests conducted, the temperature in the inner pot was reduced by 6-8 degrees C in 12 hours, and could be maintained by keeping the sand moist.

The shelf life of the produce improved significantly, as shown in the table.

The impact of the pot-in-pot was a reduction in the wastage of fresh fruits and vegetables. Farmers could hold the produce longer and sell on demand at higher prices. The cost of a pot-in-pot unit is around $5 (less than Rs 300).

Will this work in India? Tests can be run in different States to answer this question. The concept is not new as it is similar tomatka-cooled water served in many parts of our country. More than 30,000 units are being sold annually in northern Nigeria. This can't happen unless it is successful.

The cooling required for many perishables is much more than what can be achieved in the pot-in-pot. However, this inexpensive non-electrical system can be the first level of storage in the farmers' homes, for produce which are amenable to this system. Lakhs of these of varying sizes can be deployed at a very low cost.

We all know how a bank locker works. We rent space as required, have access to it when we want, and pay a modest usage fee.

Now, imagine a cold storage room at the village level of size 20' width x 25' length x 10' height – 5,000 cu ft of space. Experts refer to this as a walk-in cooler.

Bank locker example

A cold storage space of this size can be set up for a capital cost of under Rs 7 lakh (land excluded), for a cooling level of 5 degrees C, which will cover most fresh fruit and vegetables. (Temperature and moisture requirements do vary. Meat, for example, needs to be frozen. Even that can be set up.) Each cooler can be run by an owner-operator, throwing up lakhs of rural employment opportunities.

The electricity cost for such a storage locker (5 KW per hour, running 18 hours a day) is estimated at Rs 4,000 per week. Farmers can rent space in the cold locker on usage basis.

The rental cost per 100 cu ft will be just around Rs 400 per week (assuming 50 per cent capacity utilisation, and a target revenue of Rs 10,000 per week to cover electricity cost, manpower and return on investment).

The government can guarantee a return on this infrastructure investment, like it has done for fertiliser plants.

(The real challenge will be access to continuous supply of electricity, a problem that is common to all.)

India can set up 100,000 (500 million cubic feet) of these cold storage lockers in the villages andmandisfor a cost of just Rs 7,000 crore.

To put this amount in perspective, the government is spending Rs 40,000 crore on the National Rural Employment Guarantee Act (NREGA), which shows we have the resources.

India can build the largest disaggregated ground-level cold storage chain in the world.

I spoke to two experts in cold storage to collate and verify this information. They were excited that this could be done. One of them even offered to build a prototype to prove the point.

Transportation cold chain

The cost of adding refrigeration to a 7-9 tonne truck is around Rs 6 lakh. An expert in trucking whom I spoke to confirmed that truck operators will add this to their trucks, once they understand the higher rentals they can charge.

For a modest investment which can be indigenously funded, we can create a fleet of tens of thousands of refrigerated trucks plying all over the country. The pot-in-pot system, the cold storage locker chain, the refrigerated trucks, and presumably other simple ideas – all of these can be created easily.

FDI in multi-brand retail, with the massive damage it will cause to farmers and traders and the entire ecosystem, is not required to address the cold storage issue.

Instead of handing over our markets and cold chain infrastructure to foreign companies, we can create our own inclusive solution that will be the envy of the world.

Step up investments for better storage facilities

The Hindu Business Line - Jan 16 - article by Rana Kapoor - CEO Yes Bank


The World Bank estimates the prevalence of underweight children in India to be among the highest in the world. It currently stands at nearly double that of sub-Saharan Africa. This translates into a key factor contributing to our inability to ensure availability and access to nutritious food for millions in India. The Indian Council of Agricultural Research (ICAR) estimates that rice and cereal production need to grow 30 per cent, pulses 140 per cent and oilseeds by 243 per cent for the country to be able to feed its population by 2020. While programmes are undertaken on a mission-mode basis to increase food production, there needs to be a substantial capital investment flow in increasing infrastructure for food storage. Even as a substantial number have poor access to adequate food, there is a significant quantum of food that is wasted every year only because of insufficient storage facilities.

Global warming is threatening sustainability of current agricultural production levels. Research shows that if there is a temperature change of even 2 degrees Celsius and rainfall change of just 7 per cent, rice yields will fall by 15-42 per cent and wheat yields almost by 34 per cent due to compounded reasons such as drought, salinity and submergence. In the developing economies, creation of new industrialised infrastructure is causing climate change, even as the food economic system bears the increasing pressure of supply shortages and a diverse increase in demand leads to higher inflation. Monetary and fiscal policies can address this problem in the short or medium term, but efficient management of the country's food system becomes even more significant in the long term. Undoubtedly, efficient and effective storage is one of the most vital components of the food system management process. An efficient and strategic storage system not only reduces wastage but also helps in building a robust, just-in-time supply chain. This helps in reducing price volatility, ensuring higher nutrition retention, preserving value of commodities, reducing food inflation as much as in plugging the demand-supply gap. Creation of this additional infrastructure could have a multiplier effect in establishing associated agri- and food business ecosystems. Dry storages and cold chains consisting of production centres, centres of aggregation and even ports could then help in reaping a comparative advantage in export trade and also in efficient imports.