16. Tribal development and marketing of NTFPs for poverty alleviation - a case study in Andhra Pradesh, India
A. Vidya Sagar^[25]

ABSTRACT

Collecting NTFPs is not only a traditional tribal activity for survival but it could also be converted into an effective instrument for eradicating poverty. This paper presents three concepts that may be examined further. Though NTFPs has value as economic good, imperfections in marketing result in very low realization or at times disastrous sale. Unless we address the problem of marketing we cannot really make NTFP collection a reliable source of income. Tribal Development Cooperative Corporations (TDCCs) are expected to protect the tribal communities from exploitative middlemen and traders, but they are not in a position to buy the entire produce in order to command the price of that commodity. The other concept is closely related to the above - though commercial crops have support prices, the most perishable items like NTFPs do not have any such support. Perhaps this is because the tribal communities who collect the NTFPs are total dependents on the generosity of successive governments and do not belong to the vocally strong sectors. One could easily notice that the people who are vulnerable to environmental degradation are from the same sectors that have been discouraged from utilizing the resources efficiently based on their own knowledge gained over time. The present arrangement of self-help approach to resource utilization is in fact creating conflict between various implementing agencies, ultimately affecting the members of the self-help groups.

INTRODUCTION

Poverty alleviation should be an essential part of efficient utilization of resources since socially vulnerable sectors will be economically unprepared to participate in nation building in its true sense. Only active partners can realize the responsibility of conserving and utilizing the resources in an optimal way. Optimal utilization and equitable distribution of assets among its citizens is the hallmark of efficient administration.

Poverty in a developing country is therefore the result of under-utilization or inadequate access to natural resources. Rural Poverty is the result of under-utilization due to environmental degradation and tribal poverty is the result of inadequate access to resources. In the process the medium (i.e. the administration) has gobbled up the message (of development and empowerment). Proliferation of programmes has perpetuated poverty, and now poverty alleviation is an industry by itself. Poor have been reduced to mere raw material for the formation of successive dispensations irrespective of their colour.

NTFP IN POVERTY ALLEVIATION

The tribal areas, though widely known as regular source for most of NTFP commodities and the tribes depend on NTFP for their sustenance, there is no substantial market development for the NTFPs. Open market forces are playing havoc with tribal economy.

The TDCCs continue to have a significant role in the tribal economy as they procure major quantities brought by the tribes offering best possible prices irrespective of their demand and supply positions even in extreme market conditions. The trading of NTFP commodities by TDCCs is expected to achieve:

• Monetary inflow into tribal economy

• Significantly higher prices and income for NTFP collectors.

• Gradual stabilization of prices in the market preventing all vagaries of supply and demand conditions.

A glance at the prices paid by Girijan Cooperative Corporation (GCC) would reveal that the policy of TDCCs is to ensure reasonable prices and insulat the tribes from wild market fluctuations. The purchase prices paid by GCC during the last five years are given in Annex I. In contrast, the private traders purchase only certain NTFPs in a limited quantity of selected quality by offering occasionaly higher prices. In order to protect the interest of NTFP collectors and provide remunerative purchase prices, the TDCC needs to maintain the price line without making downward revisions in the purchase prices even when there is a significant downward trend so as to ensure steady income to all the tribal NTFP collectors across the state. The resultant loss is being borne by TDCC from thin margins generated on sale of other NTFP commodities. A glance at the purchase prices paid for the 25 NTFP items handled by GCC would give us a clear picture on market trends and fluctuations in the prices of NTFP. There are about eight NTFP items like gums and resins, tree born oil seeds and honey shikakai, where GCC can expect margins. Whereas bulk commodities like tamarind, myrobalans, marking nuts, soapnuts, and gum dikamal, the GCC has to react according to market fluctuations either by downward revision of purchase prices or by incurring losses.

Procurement of tamarind

Tamarind is the single largest bulk NTFP commodity, and as many as 100 000 families of coastal districts of Andhra Pradesh depend on tamarind collection for their livelihood. Hence GCC procures as much as possible and tries to pay remunerative purchase prices year after year and make efforts to dispose stocks through negotiations, auction cum tenders, value addition for retail sales, etc. (Table 1).

Table 1. Seeded tamarind procurement and average purchase prices for 1995 to 2003

The above figures clearly show GCC's commitment to pay remunerative purchase prices year after year up to year 2000. During 1999 and 2000 seasons, GCC has entered into an advance tie up with Tribal Marketing Federation (TRIFED) for marketing of tamarind and paid Rs. 650 to 750 per quintal in 1999 and 2000 seasons. Despite a glut in market for tamarind, in order to maintain the price stability, GCC has paid around Rs.600 per Qtl during 2001 season and procured 146 000 Qtls of seeded tamarind and efforts are being continued to dispose of the stocks. During subsequent years, GCC was forced to revise purchase prices downward during 2003 season to act according to market conditions and the tribal communities were deprived of support prices.

Procurement of Myrobalans

Myrobalans is another major NTFP collected by a 100 000 tribal communities to a tune of 20 000 Qtls per annum on average. The principal user is the leather processing industry. Based on the market trend, the GCC is paying remunerative purchase prices to the tribal communities and the marketing efforts are being made to sell the product to different user industries through auctions and tenders. Due to the availability of synthetic substitutes in leather processing industry, the usage of Myrobalans has come down drastically. Now virtually there is no market. The GCC is forced to cut down the purchase prices to keep in tune with discouraging market conditions.

Constraints in the disposal of other NTFPs

The other commodities like markingnuts, soapnuts and mohwa seed and gum decamali, also experience inconsistency in sale due to violent market fluctuations, government policies, seasonality, heavy influx, etc. TDCC has to act according to market situations, revising purchase prices upward or downward. This is often leading to unrest among the tribal community But there is no mechanism to pay steady prices to all NTFP items to ensure their earnings by assuring at least the price paid in the previous year (Table 2).

Table 2. The trends of purchase prices of some commodities during 1999-2003

Need for minimum support price for NTFPs

In light of above, till the tribal economy is geared up and empowered with requisite knowledge base, the GCC has proposed to the Government of India to implement a national policy on NTFP trade providing minimum support prices for all NTFPs. In the absence of such policy, the tribal communities are deprived of opportunities in terms of increased purchase prices. The Minimum Support Price (MSP) mechanism prevailing for agricultural produce and which is benefiting the farmers should also be extended to tribal NTFP gatherers, as they are the poorest of the poor.

Developing NTFP trade to eradicate poverty

Collecting NTFP is not only a traditional activity of tribal communities as means of livelihood but also could be an effective instrument of eradicating poverty. In this context there are three concepts that worth examining further.

Creating markets so as to command a price

Though NTFP has value as economic goods, the market imperfections result in very low realization or at times distressed sale. Unless we address the problem of marketing we cannot really make NTFP collection a reliable source of income. Apart from innocence on the part of the tribal communities, grinding poverty compels them to dispose off the produce at whatever rate it fetches. Further, the very nature of the produce compels them to dispose it off as early as possible. This vulnerability is exploited by the buyer. TDCCs are expected to protect the tribal communities from exploitative middlemen and traders, but they are not in a position to buy the entire produce due to financial constraints. Unless the entire produce is controlled by the TDCC it cannot command the price of that commodity. Unfortunately TDCCs have become one of the buyers instead of emerging as the sole buyer. This has continued the strangle hold of local traders on the NTFP market. Even the TRIFED whose objective is to develop markets for NTFP, has become one of the TDCCs at national level. Fortunately it is now seriously thinking of reorienting itself to market development.

Recognizing the right to support price as creation of market for NTFP

The other effective measure could be to ensure support price but most perishable items like NTFP do not have any such support. Perhaps this is because the tribal communities who collect the NTFP are dependent on the generosity of successive governments. Since tribal communities do not command the recognition that the vocal sectors get, their labour also does not get the value it deserves. Over the years this situation is further worsened as the tribal communities are made more dependent on the doles of the government.

Perspective planning based on traditional wisdom

One could easily notice that the people who are vulnerable to environmental degradation are from the same sectors who have been discouraged from utilizing the resources efficiently based on their own knowledge gained over time. Peasants who are dependent on agriculture, artisans whose activities are centered around agriculture, fishermen dependent on water, tribal communities dependent on forests have not been given any meaningful role either in the conservation of the resources or their optimum utilization. With increasing degradation of our natural resources these sectors have become victims of socio-economic discrimination. Disuse of minor irrigation sources, especially the small tanks, is the result of negligence on the part of administration and recurrent natural calamities either in the form of drought or untimely rains. Rural economy has been completely destabilized with the gradual disuse of minor irrigation sources.

In order to alleviate rural poverty with special reference to tribal communities we need to have a two-pronged approach:

• Respectable and meaningful role to the local communities in the conservation of resources; and

• Marketing strategies to generate income through value addition to local resources.

The current state of participation of local communities as stake holders/ users groups is not satisfactory, since they are still apprehensive of their role and status in the conservation and utilization of resources. They are still treated as beneficiaries under one or the other programme which gets them some temporary monetary benefits. It is necessary, therefore to create awareness among them about the need for a perspective plan based on native wisdom and local knowledge.

The present arrangement of self help approach to resource utilization is in fact creating conflict among various implementing agencies, ultimately affecting the members of the self help groups. At times the members are of the opinion that the institutional network created in the past is an obstacle. This view is the result of fragmented visions of various government departments aiming at reaching the goal of alleviating rural poverty all by themselves.

TRIBAL ECONOMY IN ANDHRA PRADESH - THE ROLE OF GCC

In Andhra Pradesh, the government has established GCC in 1956 for socio-economic uplifting of tribal communities in the state with the following objectives:

• To ensure remunerative purchase prices for the NTFP collected by the tribals from the forests of Andhra Pradesh.

• To ensure availability of essential commodities even in the interior agency areas through a network of DR depots.

• To provide support to the tribal communities in their agricultural activities through extending credit facilities.

The government vested GCC with monopoly rights on 25 NTFP (Annex II) commodities available in the forests. The primary purpose of having state control on NTFP is to ensure competitive price to tribal gatherers on one hand and keeping the rampant exploitation by private traders under check on the other. With the help of monopoly rights for NTFP items and guidelines issued by government on pricing policy, GCC is purchasing entire quantities of NTFP from tribal communities irrespective of their commercial viability and efforts are being made for disposal of the stocks.

Concentrating on certain NTFP

Though there are many commodities collected by the tribal communities only certain NTFP has continuous demand. Buying all the NTFPs with shrinking markets because of substitutes would result in locking up of meager financial resources. This would compel the TDCC to decrease the purchase price or abandon the purchase of the NTFPs in the following year. In order to utilise the financial resources effectively GCC is concentrating on certain NTFPs, which have market, at least within the country such as gums, honey, shikakai, soapnut, nuxvomica, pungamseed, naramamidi bark, hill brooms, sugandipala, and mohwa seed.

It would be appropriate for TDCC to become the sole buyer of these commodities. Similarly, all TDCCs should concentrate on certain NTFPs that have market in that state. Further TRIFED has to develop markets for at least 25 kinds of NTFPs either at national level or international level. Initially, these 25 kinds should be given support prices so that the tribal communities would be assured of reasonable income.

Increasing the quantum of procurement

As many primitive tribal groups (PTGs) are still totally dependent on NTFPs, increasing the quantum of procurement is giving them employment at least for nine months a year. Procurement of NTFPs from drought prone areas like Rayalaseema has become a continuous activity throughout the year.

Identification of new NTFPs for sustainable income

Recent shift to herbal medicines and increasing demand for natural products resulted in growing dependence on forests, the rich source of these herbal plants. However, due to unorganized exploitation, most of these species are either degenerating or under threat from external environment. GCC has made some organized efforts in this new area.

With its long time experience in handling and marketing NTFPs, GCC can take up the procurement and can become dependable supplier of medicinal herbs too. GCC foresees tremendous business potential as a continuous source of income. GCC plans to train tribal communities in the identification, collection and handling of herbal plants to prevent wrong handling and over exploitation. GCC organises training programmes for field staff and tribal farmers on the identification of plants, hygienic handling, techniques of shade drying, preserving, packing and transporting the material.

The GCC has carried out a quantitative resource survey in East Godavari District to scan and quantify medicinal herbs in these areas. As many as 210 medicinal herbs (plants and tree species) were identified and their average densities determined. Of these 210 items, 42 medicinal plants were found having high economic value, which would help to increase the income level of the tribal communities if collection was permitted.

Medicinal Herbs Department, with a library and a herbarium, was established at GCC's Corporate Office to identify the species and to liaise with divisional offices for procurement and marketing.

Depending on the availability of herbs in A.P. forests and the demand, GCC has been requesting the government for extending the monopoly rights for procurement of herbs.

The role of forest department

The Rayalaseema tribal area is inhabitated by two Primitive Tribal Groups (PTGs), Chenchus and Yanadis. This region is a drought prone area. The PTGs are mainly depending on collection of medicinal plants and selling them in the open market stealthily, since there is no agency equipped with suitable system for encouraging the collection and marketing of medicinal plants. The existing enactments are causing problems to the PTGs in the collection of medicinal plants. In this situation the middlemen are operating invisibly and getting the benefit. In view of the above it has been proposed that GCC be allowed to procure medicinal herbs from PTGs.

Based on the findings of the quantitative resource survey, GCC could assist in collection and marketing of medicinal plants in East Godavari district. GCC is procuring 25 items of MFP in the tribal area on monopoly basis since1956. GCC and forest department are cooperating to serve the tribal communities for increasing income level by regularizing the procurement and marketing of medicinal plants.

Forest department shall promote cultivation of medicinal plants in coordination with divisional managers of GCC in phases replacing the commercial crops, with the financial aid of Integrated Tribal Development Agency (ITDAs). GCC and forest department in joint coordination with ITDAs shall promote the regeneration of high valued species of medicinal plants as part of Vana Samarakshana Samithis (VSS) activity.

The forest department is promoting people's organizations known as VSS, for preservation and conservation of forests. The forest department has promoted the concept of VSS not only for providing avocation but also to ensure the people's participation. While enlightening them in regular meetings, the VSS members may be encouraged to put main thrust on plantation, nursery raising, preservation and procurement of medicinal plants, which would pave way for generating more income to tribal communities. The forest department may extend its helping hand in identification and training of the tribal members for promoting medicinal plants and marketing.

Role of the government

The effective implementation of regeneration programme is only possible with the intervention of the Government and inflow of funds. Meanwhile GCC made a provision of Rs.3 million exclusively for the purpose of raising nurseries of other NTFP and requested ITDA and TRIFED for a matching contribution. A similar proposal was also made to Government for release of Rs.200 million so that Rs.30 million can be earmarked exclusively for regeneration programme.

Forward sale

In order to stabilize the price of NTFPs, GCC is now going for advance sale agreements with the buyers. This ensures the sale of commodities with better purchase prices to the NTFP collectors. The purchase price is decided on the basis of sale price offered by the prospective buyers. An additional benefit of this system is that the funds can be utilized efficiently. By utilising the sale proceeds new stock of NTFPs is being purchased, so that the locking up funds is avoided.

Processing centers and value addition

NTFPs as raw material cannot command a price due to its perishable nature whereas processed NTFPs could be stored for a longer period. Improving the shelf life will enhance the scope for processing large quantities of NTFP. Processing centres are set up for value addition that would fetch better price for NTFPs. There are processing centres for five kinds of NTFPs, honey, shikakai, soapnut, amla, tamarind and soap making.

Retail marketing of NTFPs

• New processing units

  Value addition to NTFPs would realize better value than disposing them in raw form. With this concept, the GCC has established the following processing units to convert raw NTFP into ready-to-use products and steps have been initiated to market these products in branded form through a distribution network.

• Introduction of new products

  To capture the full market potential for forest based value-added products, a new range of products has been introduced to the existing product line. The major thrust has been given to promote the sale of the following Girijan products in consumer packs: honey, turmeric soaps, neem soaps, flower tamarind, pulp tamarind, tamarind (deseeded & seeded), Shikakai powder, soapnuts, soapnut powder, amla powder, hill brooms, rajmah (red, white & kashmiri), white beans, and dry chilies.

• Improvement in retail sales

  There is a steep rise in sales, recording 100 percent growth rate year after year from the financial year 1999 onwards. The following are the details:

• Strengthening the distribution network

  As many as 70 distributors are appointed in all the major cities and towns in Andhra Pradesh. GCC is also supplying the consumer products to welfare hostels, jails, endowments and PSU Cooperatives, etc.

• Brand building activity

  All the products developed have been brought under the umbrella of "Girijan" brand name and marketed through distribution networks. Campaigning activity through various promotional media to complement the retail efforts is in progress. This has enhanced the corporate and product image among the public and consumers.

Regeneration programme

GCC has taken up regeneration of important NTFP species in the forest areas of north coastal districts of Andhra Pradesh with a total outlay of Rs. 4980 000. The implementing agency is the AP Forest Department. Advanced operation and nursery rising of ten important NTFP species in these districts have been completed. Plantation work is in progress at Visakhapatnam district.

Training to NTFP collectors for quality control

Imparting training to tribal communities on a continuous basis is in progress for the last ten years on scientific collection of NTFPs. This has resulted in improving the quality and realization of higher sales value. Adoption of new techniques in tapping the gum karaya has led to increase in the quality yields and in turn passing on higher purchase prices to tribal communities from Rs. 30 per kg to Rs. 125 per kg.

CONCLUSION

• Socially vulnerable sectors will be economically weak and naturally unprepared to participate in the developmental programmes.

• Tribal poverty is due to inadequate access to natural resources.

• Creating markets should be the aim of the governments so as to command reasonable and sustainable prices.

• Recognizing the right for support price is a step towards creating market for NTFP.

• Perspective planning based on traditional wisdom and sustainability is needed.

• Concentrating on selective NTFPs that have continuous demand is the need of the hour.

• TRIFED should develop markets for at least 25 kinds of NTFPs in the country.

• Value addition and processing centres should be developed on a large scale.

• Retail marketing of NTFPs is an effective outlet.

ANNEX I

PURCHASE PRICES (RS. PER QUINTAL)

ANNEX II

THE LIST OF NTFP ITEMS UNDER LEASE AGREEMENT WITH GCC A.P.