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Pitch

Transforming barren lands through agro-forestry for sequestring carbon; food security to small tribal farmers & raw materials to industries


Description

Summary

There are 1.4 billion poor people in the world living on less than US$1.25 a day (http://www.ifad.org/media/press/2013/27.htm). One billion of them live in rural areas, with small farmers constituting bulk of rural poor. Human Development Report (HDR), UNDP 2010 highlights that acute poverty prevails in eight Indian states, including Chhattisgarh together accounting for more poor than in the 26 poorest African nations combined (http://timesofindia.indiatimes.com/india/8-Indian-states-have-more-poor-than-26-poorest-African-nations/articleshow/6158960.cms?referral=PM)

On one side, small farmers are opting out of agriculture, while on the other Indian paper industries have serious shortage of raw materials, and are forced to import. As per Indian Paper Manufacturing Association (IPMA) report the domestic consumption of paper is about 13.10 million tons per annum (TPA), with 2.25 million TPA pulpwood is being imported. By 2025, domestic consumption is projected to rise to 23.50 million TPA.

While the industries’ interest is in sourcing raw materials from farmers, the long gestation period does not work out as a good option for small landholders.

India’s INDC recognizes the importance of aggressively restoring forest cover, in a manner consistent with supporting livelihoods. The country commits to create an additional carbon sink of 2.5 to 3 billion tonnes of carbon dioxide through additional tree cover (http://www.wri.org/blog/2015/10/5-key-takeaways-india%E2%80%99s-new-climate-plan-indc)

SAI’s Inclusive Business Model (IBM) integrates tribal small farmers into corporate value chains through agro-forestry, thereby helping India meeting its INDC, promoting livelihoods and helping underutilized rural lands become productive.

The economic benefit to the farmers is US$790/acre/year (above international poverty line of US$1.90 a day) against Business as Usual. SAI is scaling up the impact through Public-Private partnership (PPP) with Forest Department, Chhattisgarh, India.


What actions do you propose?

We follow an agro-forestry model with plantation in paired row and inter-cropping in the in-between the space (20-30 feet).

As our farmers belong to small and marginal category with no irrigation facility, we promote those varieties of crops and plantation which grows in rainfed condition. Access to finance and market together with technical inputs are critical areas of support these small farmers need. We ensure forward and backward linkages in following ways:

  • Forward Linkage
    • Supply orders and buy back guarantee from the companies
  • Backward Linkage
    • Organizing small landholders in Local Farmers Association (LFAs),
    • Building their capacities in plantation, inter-cropping and financial literacy,
    • Arranging quality inputs for production
    • Providing technical and  monitoring support
    • Manage end to end supply chain (including supply of inputs, finance, technology for production, and harvesting, storage and marketing of produce

As SAI has already piloted the model since 2013, it has assessed its economical, social and geographical feasibility. The success of pilot further validates its feasibility in the poorest regions. The Chhattisgarh government has invited SAI to scale-up the model for which government has earmarked the budget. It demonstrates political willingness and commitment.

 The promoter & CEO of SAI earlier worked as Adviser to IFC/World Bank India Farm Forestry Program (http://www.ifc.org/wps/wcm/connect/c629c980478ce1bebeddbe86d3bfc329/forestryindiasector_lc.pdf?mod=ajperes) to advise paper industries on improving assured supply of pulpwood. The major limitation was found in the approach. Where paper industries were looking for ‘wood’ the small tribal farmers had the challenge of getting ‘food’ for their survival. SAI brought both ‘wood & food’ together by introducing ‘agro-forestry’ system. SAI also promoted concept of ‘Community Resource Person’ (CRP) by training and hiring rural youth to provide technical and monitoring support to farmers. This approach brought down the cost significantly, improved trust & confidence among tribal community, and provided full time employment to rural youth who otherwise would have migrated. The idea is simple and novel, which addresses ‘win-win ‘approach for everybody.

As SAI is working exclusively on barren land there is currently no economic benefits from these lands to the tribal farmers.

Through SAI intervention, farmers get economic benefits from three different sources:

  1. From Matured Pulpwood: SAI has signed advance purchase agreement with paper industries, according to which current market price will be the base price. As the plantation takes 4 years to mature with an average productivity of 40 tons/acre, the farmers will sell at future market price (after 4 years) or today’s market price, whichever is higher. The market price in 2012 was Rs.2700/- per ton (US$41 per ton) which is now Rs.4500/- per ton (US$70 per ton).

 

At today’s market price, the farmer will get a gross income US$2800 per acre (US$70 x 40 = US$2800). After deducting the harvesting and transportation cost (@US$20 per ton) s/he gets a net income US$2000 per acre in one cycle of plantation (4 years) or US$500 per acre per year.

  1. From Inter-crop: The farmer also cultivates inter-crop for which s/he gets approximate 3 quintals per acre per year under rainfed condition. At current market price of US$90 per quintal the farmer earns US$270 per acre per year.  (US$1 = INR65)

 

  1. By Saving Money on Fertilizer: SAI encourages farmers to grow legume crops (Pigeon Pea, groundnut, chick pea) with nitrogen fixation ability, as inter-crop for which it has tied up with agricultural university in Chhattisgarh. As per ICRISAT field research, these crops fix approximate 30 kgs of nitrogen per acre. By converting this amount of nitrogen into economic value, the farmer saves US$20 per year on urea fertilizer (46% N with subsidized rate of US14 per bag of 50 kgs).

 

As such, the total economic benefit to the farmers through agro-forestry intervention is US$790 per year, which is above international poverty line of US$1.90 a day (http://www.worldbank.org/en/publication/global-monitoring-report).

The farmer is likely to get economic benefits from 4th source through carbon credit once SAI is able to establish its market mechanism. As per UNFCCC assessment conducted in SAI field area in Odisha, 50% of the wood mass i.e. 20 tons per acre is atmospheric carbon. The farmers can get economic benefit through carbon trading by selling this much carbon every acre.

SAI has already established its model in 300 acres in Odisha. Impressed by our success, the Forest Department, Chhattisgarh government has recently collaborated with SAI under Public-Private Partnership (PPP) mode to scale-up the model in tribal dominated regions (Bastar, Sarguja, Raigarh, etc.) of Chhattisgarh by utilizing Compensatory Afforestation Fund under CAMPA (http://www.dnaindia.com/india/report-lok-sabha-passes-bill-on-compensatory-afforestation-2208878). It is worthwhile to mention that recently Indian Parliament passed US$6 billion under CAMPA.

SAI is enhancing its impact in two ways

  1. Scaling up the Area: As per the collaborative arrangement with the Forest Department, Chhattisgarh, SAI will facilitate identification and capacity building of farmers, while the government will provide inputs (sapling, fertilizers and medicines) and incentives to those farmers (Rs.6 per plant). SAI will further provide technical hand-holding and supply chain management support to these farmers for which it will charge 10% of the farmers’ net income. The Forest Department was earlier implementing CAMPA under ‘Hariyali Prasar Yojna’ in Chhattisgarh while SAI was promoting agro-forestry with the same plantation species in neighbouring state, With two partners joining hand, the impact is likely to be multiplied manifold.

With the formalization of this collaboration, SAI has potential to cover 25,000 acres every year in Chhattisgarh. It is anticipated that once the collaboration is proved successful, other state governments will come forward to collaborate with SAI to replicate the model in their states.

  1. Deepening the Impact: SAI is also working with farmers on value chain management of the inter-crop, by promoting small scale processing and packaging activities. This will further enhance the income to the farmers and provide employment to those rural youth, who will be managing the processing and packaging work. We are promoting collaboration with Indira Gandhi Agriculture University, Chhattisgarh to link with ‘National Food Security Mission’ (http://nfsm.gov.in/).

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Who will take these actions?

Small landholders

Follow SAI’s technical advice on agro-forestry model on their upland

Forest Department, Chhattisgarh, India

Provide inputs (saplings, fertilizers/compost, medicine) under CAMPA (Compensatory Afforestation Fund Management & Planning Authority  http://pib.nic.in/newsite/printrelease.aspx?relid=119907

Agriculture Department, Chhattisgarh

Provide inputs and technical support on oilseeds and pulses to small farmers under ‘National Food Security Mission’ (NFSM) at http://nfsm.gov.in/

Paper & Pulp Industry

Supply of quality saplings (at Rs.6/- sapling)  with buy back guarantee at prevailing market price.  

Transporters

Providing transportation to goods (food-grains and wood)

Labour Group

Employment during harvesting, debarking and loading-unloading of pulpwood and food grain


Where will these actions be taken?

Central India, tribal areas of Chhattisgarh state (Bastar, Sarguja, Raigarh and Mohla-Manpur area of Rajnand Gaon)


How much will emissions be reduced or sequestered vs. business as usual levels?

The project will approximately arrest 20 tons of atmospheric carbon per acre against business as usual, as these are barren land with negligible carbon sequestration currently. UNFCC project has estimated the carbon sequestration through agro-forestry in SAI’s project area in Odisha, and 50% of wood mass is the carbon. The documents are available at its website  https://cdm.unfccc.int/Projects/DB/TUEV-SUED1298895593.56/view

As SAI plan to initially scale-up the model to 10,000 acres the approximate carbon sequestration will be 200,000 tons.

 


What are other key benefits?

•       8000 small and marginal farmers have food and income security,

•       10,000 acres barren lands are brought back into national economy system, contributing US$30 million to the national economy (market value of 400,000 metric tons woods)  

•       7 million trees planted and maintained with less than 5% mortality (700 trees per acre for 10,000 acres).

•       8000 small farmers’ family are cultivating  lentils, millets, pulses & paddy in their land to meet their consumption need.

•       The value of their crops from inter-cropping is US$2.3 million annually

•       250 rural youth got full time employment as Community Resource Persons (CRPs) with SAI.


What are the proposal’s costs?

The proposal cost is US$450,000, out of which US$210,00 towards Operational Expenses (OpEx @US@21 per acre), US$170,000 towards training and capacity building (@US$17 per acre), and US$70,000 is towards management cost (@US$7 per acre).


Time line

2016: SAI recruits field teams and formalize NGO partnership, conduct survey, identify farmers and stabilize agro-forestry model in 1000 acres in Chhattisgarh. Needed finance mobilized through promoters.

2017: SAI mobilize finance through investment/debt financing, expand the area and scale up the model to 4000 acres

2018: SAI further scale-up the model to 5000 acres (a total of 10,000 acres in 3 years)

As the trees grown are of grass variety, they regenerate every 4th years once they are harvested. Therefore, the benefits will continue from 4th years onwards.

It is also expected that the 250 trained rural youth will continue to provide services and get employment on service fee basis, which SAI would have established in 4 years.


Related proposals

Swami Vivekananda Fruit-Tree Expansion Mission at https://www.climatecolab.org/contests/2016/land-use-agriculture-forestry-livestock/c/proposal/1330504

Promoting community-led tree nurseries in rural Africa at https://www.climatecolab.org/contests/2016/land-use-agriculture-forestry-livestock/c/proposal/1331624

Linking smallholder economic development and climate change mitigation at https://www.climatecolab.org/contests/2016/land-use-agriculture-forestry-livestock/c/proposal/1331668

Empowering forest owners in Natural Resource Management (NRM) and forest conservation at https://www.climatecolab.org/contests/2016/land-use-agriculture-forestry-livestock/c/proposal/1331614

Agroforestry systems at https://www.climatecolab.org/contests/2016/land-use-agriculture-forestry-livestock/c/proposal/1331566

Fostering community development, access to modern energy services and forest conservation in India at https://www.climatecolab.org/contests/2016/land-use-agriculture-forestry-livestock/c/proposal/1331540


References

Already included in proposal

SAI video documentary is available at Youtube at http://youtu.be/Sm47dETg8Vc