Can producers co-operatives, including food processing co-operatives, on the lines of the Amul Dairy co-operatives, be a panacea for inflation, low rural incomes and other woes of farmers, not to mention the pollution problems of cities such as Delhi? There is indeed a good chance, and higher Minimum Support Prices (MSPs) which have other downstream side effects, need not be the only medicine for rural ills. Not only Amul, other experiments, though less well-known, also illustrate this point.
The Punjab and Haryana farmers’ agitation which held life up to ransom at the Delhi borders, is partly at least, due to lack of diversification in cropping and lucrative alternatives in the farm sector. The green revolution in these states, with its emphasis on wheat and rice to the neglect of horticultural crops, onward processing activities, and off farm activities was a mixed blessing. Fiercely individualistic, the northern farmers have not taken to the cooperative route, so successfully shown to be one solution to low rural incomes in other parts of India.
Admittedly, apart from dairy and sugar co-operatives in Gujarat and Maharashtra respectively, co-operatives have not always been successful in India. To be successful, cooperatives require a high level of leadership at the grassroots, as well as trust in the integrity and ability of that leadership, and trust among members themselves. In addition, it requires a regulatory framework which does not kill initiatives but checks wrongdoings, and availability of technical knowhow at the grassroots.
It was the combination of the political leadership of Tribhuvandas Patel, the technical skill and vision provided by Dr Verghese Kurien and the innate entrepreneurial ability of the Kaira district farmers which made for the success of the Amul model. Although rare, these elements can also be cultivated in other environments, as demonstrated by the Bharat Rural Livelihoods Foundation’s (BRLF) experiment with Agriculture Production Clusters (APCs) in Orissa’s tribal regions. It has shown that an absence of political leadership alone need not stop the progress on this front, if good partnerships can be formed between the producers themselves, the state, and civil society organisations.
The BRLF is an independent society set up by the Union government in 2013, to foster partnerships between the government , private philanthropic organisations, civil society organisations and other stakeholder groups to upscale civil society action. The goal is to transform the livelihoods and lives of the most vulnerable people across India, with a special focus on the Central Indian tribal region.
The model addresses two fundamental issues — scale and quality. Civil society work, while it triggers the initiative of people themselves, tends to be limited in scale. Governments on the other hand, have the resources and can work on a large scale but the results do not always ensure quality, and that they reach the last needy. Acting as a broker, the BRLF has leveraged the strengths of both to benefit the most vulnerable.
In 2018, the BRLF launched the Promotion of Agriculture Production Clusters (APCs) project, a collaborative initiative involving three sectors. The state sector comprised 13 agencies, including the Department of Horticulture, Department of Agriculture and Farmers Empowerment, Odisha Livelihoods Mission, and the Forestry Department. The civil society sector was represented by the BRLF and PRADAN, a renowned all-India nonprofit organisation specialising in rural development, along with 16 local civil society organisations (CSOs). Additionally, 1,20,000 women Self-Help Group (SHG) farmers across 40 tribal-dominated blocks in 12 districts of Orissa were also part of the initiative.
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Later, the philanthropic sector joined the partnership, with companies and charitable foundations supporting CSR projects. Notably, Utkal Alumina International Ltd. partnered on an integrated livelihood project, aiming to double the income of 15,000 small and marginal farmers in two blocks of Rayagada and Kalahandi districts, focusing on agriculture, water, and livestock development.
The focus of the APC was on small and marginal women farmers, with the aim of substantially increasing their income through collectivisation for the cultivation of high-value crops, such as fruits and vegetables, oilseeds, medicinal herbs, spices, and livestock rearing, and for synchronising agriculture production and marketing across the cohort.
All the individuals living in a given area under similar conditions and engaging in similar agricultural activities are grouped into Agricultural Production Clusters. The local CSOs, and members of the cluster decide what to grow and identify the markets for the product. They then undertake synchronised agricultural planning, when and what crops to plant (high value crops are encouraged), when and whether to irrigate and fertilise, how and where to market and so on.
Where irrigation was needed and there was no irrigation infrastructure, the project was to create new regional infrastructure.
The work of forming the farmers’ groups of 20-30 women was done by the local CSOs who were also the implementing partners of the project. The technical advice was provided by PRADAN, and the money came from the state government under its various development schemes and private philanthropic donors.
A group, of above 20 members, was registered either under the Co-operative Societies Act, as a co-operative society or under the Companies Act as a producers’ company. The latter registration enabled a group to market outside the state.
When a farmer engages in rearing ducks, fish, or livestock as a business, they are considered an agricultural entrepreneur, who is also market-linked as a value chain enabler. For each cluster, market routes and actors surrounding the identified commodities were developed. The bulk marketing enabled by group formation has attracted corporate buyers like Reliance and Namdhari.
In short, the project covered the entire process from collectivisation to production to storage and processing and marketing which included installing storage or processing structures, grading, sorting, weighing and packaging.
The whole process was supervised by the BRLF which was also responsible for spreading sustainable agricultural practices like Non Pesticide Management (NPM), introducing new and improved technologies such as soilless nursery, drip irrigation, polythene mulching, multilayer farming, solar drying and so on.
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Finally, the project involved regular training of participants at all levels of the project.
With this collaborative approach the project has shown impressive progress — 932 producer groups had been formed by 2023-24, with 12,2,407 women farmers as members. Over 30 producer companies have 64,703 shareholders with a share capital of Rs 328.932 lakh and Rs 892 lakh turnover. And, best of all, the annual household income from the Agriculture Cluster Project has gone up by 130% from Rs 21,887 to Rs 50,357.
Encouraged by the success of the project, the Orissa Government has extended it to all the districts in the state under the Orissa Livelihood Mission with funding from the Bill and Melinda Gates Foundation and the District Mineral Fund. On its part, the BRLF is replicating it in Chattisgarh, Jharkhand and Maharashtra.
Admittedly, the Punjab farmers and the tribal women farmers of Orissa are two different species, but nevertheless the Orissa experiment offers two important lessons which can be applied in Punjab or anywhere else.
One, if rural incomes are to improve, and urban migration to be curtailed, a 360 degree, integrated approach is necessary. Not only diversification of livelihoods but all stages of the production and marketing process need to be tackled as parts of a whole. The second even more valuable lesson for both the farmers and the government is that collaboration and co-option work better than agitation. The above process creates a space for peaceful dialogue and meaningful policy changes beneficial to all without resorting to tractors and teargas.
Pushpa Sundar is the author of several books and articles on civil society and philanthropy.
