South Asia Agriculture and Rural Growth Discussion Note Series Mar 2020 Public Disclosure Authorized 1 10 LEVERAGING COMMUNITY INSTITUTIONS TO SUPPORT AGRI-BUSINESS AND LIVELIHOODS IN JHARKHAND, INDIA Public Disclosure Authorized Key findings Average income at baseline for households targeted under JOHAR1 was INR 56,4302, with household size of 5.34 and average per capita income of INR 10,567. JOHAR’s high value agriculture (HVA) crops have significantly higher (3.3 times) gross sales per acre compared to non-HVA crops. Public Disclosure Authorized Access to irrigation was a major predictor of whether households cultivate HVA crops in multiple seasons. The average net income per acre for irrigated land was 2.67 times that of non-irrigated land. Context Jharkhand has the second lowest income demand for agriculture production and level among all states in India despite enterprise. The National Rural Livelihoods having the largest share of mineral The JOHAR project was initiated in 2017 Mission, supported by the resources and impressive economic to aid targeted rural producer households World Bank, has been performance during the 12th five-year plan to diversify and enhance their household Public Disclosure Authorized (2012–2017). More than half of Jharkhand’s implemented in Jharkhand income, and achieve a significant increase labor force relies on agriculture and allied over the past several years, in real income till 2023 in selected blocks of sectors, and a large portion of the farming and has built a robust platform rural Jharkhand. JOHAR builds on the work community consists of small and marginal of community institutions that of the National Rural Livelihoods Mission farmers3, who practice rain-fed single crop include women self help groups (NRLM) in the state. subsistence farming. Access to irrigation (SHGs) and their federations. is critical and its absence leads to lower The JOHAR project recently completed a JOHAR’s objective is to use income levels since it limits crop choice, baseline for the project evaluation using this base of women SHGs and yield and cropping intensity. Further, poor randomized controlled trial, supplemented their federations to enhance market access and an underdeveloped with a non-random control group outside and diversify household financial sector limit options and incomes the program area that would provide a counterfactual based on an additional income in select farm and for small producers; persistent gender gaps in agriculture limit access and control for quasi-experimental design. The data non-farm sectors for targeted women; and skill development in agriculture presented are primarily from surveys beneficiaries in project areas. and allied sectors lags behind the growing of women self help groups (SHGs) and 1. Jharkhand Opportunities for Harnessing Rural Growth. 2. The average monthly household income in INR 5,854 for Jharkhand. Source: NABARD All India Rural Financial Inclusion Survey (2016-17). 3. For more details on the project see: World Bank. 2017. India - Jharkhand Opportunities for Harnessing Rural Growth (JOHAR) Project (English). Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/303211498576866109/India-Jharkhand-Opportunities-for-Harnessing-Rural-Growth-JOHAR-Project 2 households conducted between August and outcomes. The purpose of this note is to beneficiaries, and outlines how the project November 2018. The discussion focuses on present key baseline results and how they can achieve its target of enhancing and 13 program intervention blocks (302 SHGs validate the project’s theory of change. It diversifying the income of rural producer and 1,568 households) to inform improved summarizes the findings from the baseline, households. implementation and attainment of intended presents the status-quo on potential JOHAR Interventions I. Institutional interventions, which include the collectivization of producers into producer groups (PGs) and Farmer Producer Organizations (FPOs) that provides the base for the delivery of other interventions. II. Input interventions, which include provision of higher quality seeds or hatchlings and establishment of infrastructure (such as irrigation systems or animal sheds). III. Market interventions, which include supporting farmers to move up the value chain and undertake additional activities, such as sorting and grading Image Credit : JSLPS or processing, before they sell their produce. The project has complex impact pathways chain of inputs, outputs, initial outcomes, with multiple intervention components. The intermediate outcomes, final outcomes and IV. Credit or finance interventions, theory of change, presented here, describes impact (discussed below). which improve the availability of finance the project and its strategy to push target to producers by providing access to •• There are five types of intervention credit from community institutions as well households along the impact pathways in a inputs: as financial institutions. simplified framework, organized as a results JOHAR theory of change showing impact pathways Increased Increased availability Input income and quality of inputs; Collectivization into PGs and FPOs Interventions lower costs of inputs Institutional Interventions: Higher prices or Increased sales Market Improved market access greater value add revenue Interventions Credit/Finance Increased availability Interventions and access to credit Changes in Increased production production decisions - Quantity - Use of inputs (productivity + area) Improvement in farmer - Diversification - Quality Skills and Knowledge knowledge and - Output mix Interventions information and increase in farmer skills Convergence Inputs Outputs Initial Outcomes Intermediate Outcomes Final Outcomes Impact 3 V. Skills and knowledge inputs, as well as lower cost of inputs. through diversification or increased use interventions, such as trainings on II. Improved market access. of inputs; which in turn would lead to the prescribed package of practices, increased production and/or productivity III. Improved access and increased capacity building, and the provision (intermediate outcome) and increased availability of finance. of climate information and market sales revenue (final outcome). intelligence. IV. Improved knowledge and increase in skills. •• The above outcomes, in turn, are expected to lead to an impact in terms •• The above inputs are expected to lead to •• The above outputs would enable of meeting the program targets of four related outputs: producers to change their production increased household income of targeted I. Increased and improved availability of decisions (initial outcome), such as producer households. Key Learnings This section summarizes key learnings from the recently completed baseline for the project evaluation4. Enhancing incomes from agriculture requires shifting to production of HVA crops and increasing cropping intensity through multi-season cropping. HVA cultivation has the potential to yield higher returns, given that HVA crops have significantly higher average gross sales per acre (3.3 times) than non-HVA crops. However, data shows that only 67 percent of the households cultivate (any) HVA crops, that too allocated in fragmented and small landholdings (on average 0.08 acres per household). Image Credit : Rohit Jain HVA production is strongly correlated with the ownership of midland and upland, and the use of irrigation. It is not correlated zaid (0.03 acres) seasons leading to a low season use. Only 41 percent of households with landholding size or other independent cropping intensity of 110 percent. have access to some form of irrigation on variables. This validates the emphasis To enhance rural incomes, JOHAR would their land, mainly as private wells. Of these, on providing irrigation to households to need to focus on increasing the total area only half and two-thirds of households use facilitate HVA cultivation and suggests that under HVA cultivation, primarily through it during kharif5 and rabi seasons (with the project should focus on upland and three potential pathways. First, by nudging variation by topography) respectively, midland. This is further supported by the and incentivizing existing HVA farmers which falls to a quarter or less during the fact that 82.9 percent of households who to expand their land allocation to HVA summer season. This could be due to lack have access to irrigation undertake HVA cultivation. Second, by supporting traditional of availability of water, such as wells drying cultivation compared to 56.6 percent of non-HVA farmers to undertake HVA up. This and other barriers to using irrigation households without irrigation. cultivation. Third, by enabling both HVA and need to be overcome. Findings from the non-HVA farmers to cultivate HVA in more baseline survey suggest that irrigation could Furthermore, HVA crops allow cultivation seasons than they currently do. increase the current average cropping in multiple seasons. While 99 percent of intensity from 110 percent to 193 percent. the JOHAR target households cultivate in the kharif (monsoon) season, 47 percent Increasing irrigation coverage is cultivate in the rabi (winter) season and only key to increasing land use and Adopting new practices holds multi-season cropping.The average potential to reduce costs and 14 percent cultivate in the zaid (summer) net income per acre for irrigated land is 2.67 improve productivity. The baseline season. The average cultivated areas times that of non-irrigated land due to multi- data suggest a huge potential to increase are quite low during rabi (0.14 acres) and 4. For more details on the baseline see: http://jslps.org/wp-content/uploads/JOHAR-IE-Baseline-Report.pdf. 5. It is presumed that irrigation used in kharif is low because people are relying on rainfall. 4 productivity, as there are significant Variations in productivity across households productivity differentials across households, with the most productive households Kg/acre by decile producing 10 times more per acre than the least productive households6. 5000 This suggests that many farmers have the 4500 potential to increase productivity through 4000 adoption of new practices already being 3500 Kg/acre practiced by their neighbors. 3000 Most farmer households suffered from lower 2500 net income owing to high cost of inputs (up to 45 percent of gross income) and 2000 low sales prices, primarily due to market 1500 inefficiencies (such as poor market linkages, 1000 multiple dealers and middlemen). The low 500 degree of collectivization further created an impediment to leveraging the benefits of 0 0 1 2 3 4 5 6 7 8 9 economies of scale in input procurement, as well as the sale of the final produce. Decile Further, there is potential for income gains higher level markets by reducing market example of tomato price differentials across through collectively selling produce at inefficiencies. The table below shows an various markets. Average sale price of tomato at various levels of markets Proportion of households Markets selling tomato in the market Average price for tomato in (%) the market (INR/kg) Farmgate 15.28 15.91 Village 55.14 12.76 Block 32.22 21.56 Low access to credit limits the amount of savings per member was productivity and climate ability of target households, modest, and only in one-third of instances resilience. Less than 4 percent of the and low lending from SHGs did the respondents report that savings households received any skills training limits their capability to meet were loaned out immediately. Low savings in the past three years. This holds back project objectives. Only 16 percent and lending limits the capacity of SHGs to adoption of new practices and skills training of households had a loan in the past year. meet the project goals of extending financial support is required to augment the capacity Of these, only around a third reported using support for value chain activities, such as of participating farmers. Further, adverse the credit to purchase farm assets; most processing, marketing and undertaking weather conditions make farmer households reported using it for non-income generating agri-business. vulnerable to crop loss. Less than 1 percent activities. Further, despite high participation of households reported having received any rates in SHG savings activities, the savings Low knowledge and training training in climate-related stresses and their generated were low and often not utilized for on new practices needs to impact on livelihoods or having adopted productive purposes. The mean prescribed be addressed to improve any farm-level practices to cope better 6. Producer households are ranked by output productivity (kilograms produced by acre). 5 Image Credit : Rohit Jain with climate change. Supporting farmers to and non-timber forest products these vulnerable households by providing manage climate risk and other shocks would (NTFPs) to address vulnerability opportunities to adopt allied production increase income and de-risk investments in in the form of low levels of activities, such as livestock rearing, fish diversified and intensified production. diversification and high rates farming in community-owned water bodies, of landlessness. Baseline data at and collection or processing of NTFP would Significant scope for promoting the village level showed that 27 percent be key in addressing the needs of landless livestock development and of scheduled castes, 19 percent of households. This effort of supporting significant efforts to nudge other backward castes and 9 percent of vulnerable households requires focus, households to take up fisheries scheduled tribes were landless. Supporting since only 6 percent of households reported Contribution of various income sources toward average annual household income Non-Timber Forest Product (NTFP) Livestock Wages Agriculture Other sources Enterprise National Rural Employment Guarantee Act (NREGA) 6 livestock as a primary or secondary activity, even though 42 percent of households reported owning a goat. This suggests significant scope for promoting livestock as a profitable economic activity. Data suggests that impediments for women livestock producers include inadequate knowledge on scientific management practices, compounded by a lack of formal training. JOHAR needs to focus on alleviating these issues. Further, only 10 percent of target households reported engagement in the collection or processing of NTFP, which implies that significant effort would be needed in nudging households, whether landless or landed, to engage in the collection or processing of NTFP. Image Credit : Rohit Jain Way Forward The data collected for the project baseline producer households in Jharkhand7. adoption of good practices, collective evaluation validates the project’s theory of In particular, facilitating irrigation and marketing of produce, improving access change, by showing that diversification switching to HVA cropping has the to credit, and promoting supplementary and intensification of production can potential to transform incomes. This can income generating activities. significantly increase incomes for rural be supplemented by supporting broader 7. Average gross sales per acre for households that only cultivate paddy is INR 20,290, whereas is INR 37,464 for households that cultivate paddy and HVA. ABOUT THE DISCUSSION NOTE SERIES This note is part of the South Asia Agriculture and Rural Growth Discussion Note Series, that seeks to disseminate operational learnings and implementation experiences from World Bank financed rural, agriculture and food systems programs in South Asia. Author: Bipin Bihari, Jasmeet Khanuja, Anand Kothari, Tom Newton-Lewis & Gurpreet Singh Series editor: Vani Kurup Publication Design & Illustrations: Parth Varshney We are grateful for the generous support from DFID. Disclaimer: The findings, interpretations, and conclusions expressed in this note are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its affiliated organizations or to members of its Board of Executive Directors or the countries they represent. South Asia Agriculture and Rural Growth Discussion Note Series Mar 2020 Public Disclosure Authorized 11 1 LEARNINGS FROM COMMUNITY- BASED SMALL SCALE IRRIGATION IN TRIBAL AREAS OF JHARKHAND, INDIA Public Disclosure Authorized Key achievements 1060 detailed project reports for community led irrigation developed through active women participation 450 local cadres developed to support project preparation, installation, operations and maintenance Over 500 water user groups promoted for judicious use of Public Disclosure Authorized water resources Strengthened internal capacity building of staff and self driven innovation, ensuring sustainability Context The absence of robust irrigation insecurity, adversities of climate change, infrastructures and water resource as well as subsistence farming through contraints resulting from climate change1 augmenting irrigation facilities with small-lift would reduce Jharkhand’s agricultural irrigation systems, gravity-based irrigation production over time. The state utilized only systems and check dams on seasonal 12 percent of its irrigation potential (of the streams. However, much needed to be done Public Disclosure Authorized net sown area only 13.5 percent has access as irrigation equipment (such as pumpsets, to irrigation) due to inadequate development sprinklers or drip irrigation systems) and poor maintenance of irrigation was owned by only 5.72 percent of rural infrastructures. households. Capitalizing on the state’s Being agro-climatically favorable2 for high potential, the JOHAR3 project intrinsically value crop cultivation, Jharkhand has the focused to harness irrigation facilities for approach, that of “community-led irrigation” advantage of addressing issues of food deprived households through lift irrigation which brings water directly to the fields, systems. and fosters community ownership from the JOHAR is a pioneer in JOHAR is a pioneer in enabling tribal onset of project conception, to survey and enabling tribal communities communities to be an integral stakeholder implementation, right through to operations to be an integral stakeholder in development by ensuring availability, and maintenance. in development by ensuring accessibility and utilization of water This note highlights JOHAR’s focus on resources for agricultural development. availability, accessibility promoting such an approach through and utilization of water JOHAR supports 200,000 small and engaging the community, particularly marginal farmers in primarily rainfed, women in planning, implementation, resources for agricultural backward, drought prone, upland and tribal monitoring and overall management of their development areas of Jharkhand. It facilitates a unique irrigation infrastructure. 1. Jharkhand Action Plan on Climate Change, 2014. 2. Undulating land topography, runoff and geomorphological characteristics promotes sub-surface flow of water after the monsoon season. 3. Jharkhand Opportunities for Harnessing Rural Growth. 2 Interventions Development of community-led irrigation systems resulted in the JOHAR team strategically engaging communities right from inception, planning, implementation, monitoring and overall management of the irrigation infrastructure. Details of the iterative activities and processes conceived for the irrigation scheme are outlined below. Command Area Planning and Irrigation System Operation 8 Formation of high value agriculture producer group (PG): 7 Monitoring and Supervision A high value agriculture PG of 25-50 members was formed by the JOHAR team at the initial stage with women farmers Vendor Selection and Management 6 from a particular area (generally a village) to collectively plan for overall agriculture 5 Formation of Water User Groups and Training development and undertake collective actions for engaging with markets. Community members undertook small- Selection of Local Cadre and Training 4 scale irrigation work to ensure accessibility, availability and utilization of irrigation facilities to all members. 3 Technical Survey and Preparation of Detailed Project Report Concept seeding, identification and selection of irrigation patch: Concept Seeding and Patch Selection 2 PG members were trained by community service providers of high value agriculture to identify possible sites for installation of 1 Formation of High Value Agriculture Producer Groups lift irrigation and gravity-based irrigation systems through community consultation processes. The technical team of JOHAR, along with community members, later conducted a technical feasibility study of plausible sites and selected the most suitable sites based on local biophysical and social criteria. Any discordance between the community consultation and the technical Process map for implementing the irrigation scheme feasibility study were reconciled at village meetings and concurrence was arrived at by was prepared by a technical team in as a technical service provider (TSP) who community consultation processes. consultation with community members. received customized training on overall JOHAR’s para irrigation engineers (PIEs) operational procedures and management Technical survey and preparation and district irrigation consultants used of irrigation infrastructure. After installation of detailed project report: an innovative automated system of DPR of the irrigation infrastructure, TSPs were The designs of pumpset, pumphouse, preparation through an application-based entrusted to manage day-to-day operations seepage wells and positioning of outlets software specifically designed for the of the irrigation infrastructure and collect were calculated from technical survey project. irrigation fees at the village level for its data. Detailed cost estimates and drawings services. of pumphouses, seepage wells, trench Selection of PIEs and technical excavations, pumpset installations and service providers: Formation of water user group solar panels installations were prepared JOHAR prioritized capacity building and training: with due diligence to environmental and processes and identified and trained a A water user group4 (WUG) with 15-20 social aspects. A final detailed project report local cadre of PIEs for timely technical farmer members for a command area of 5-8 (DPR) entailing geographic, demographic, support at each site. Community members hectares shared common responsibilities technical, environment and social aspects selected a person from within the village of judicious and efficient use of irrigation 4. A sub-group of agricultural producer group. 3 Highlights of JOHAR’s irrigation project The JOHAR’s irrigation project till date has prepared 700 DPRs of irrigation projects and commissioned 106 projects at the village level. 80% of irrigation schemes operate through solar power, and 20% through either electricity or diesel-based Image Credits: Rohit Jain power sources. water. WUG members were trained and underground pipes were selected by the technical cadre on institutional by community members from the state’s 70% of the water source for aspects, common property sharing, empanelled list of vendors. Local vendors irrigation is through seepage efficient utilization of water resources, were selected for installation of the wells that replenish their yield conflict management, as well as overall pumphouse and construction of seepage through sub-surface recharge. management and maintenance of irrigation wells. Community members followed due 30% of the irrigation water infrastructure. WUGs collectively participate diligence procurement processes and source is developed through in crop planning, procurements of crop sequentially managed the implementation construction of small check inputs, and marketing activities along with of various crucial timebound tasks with the dams and other embankments the other PG members. respective vendors. across the seasonal streams. Vendor selection and Monitoring and supervision management: during implementation: Command area planning and Community members were oriented The technical team of JOHAR (consisting irrigation system operation: and trained by the JOHAR team and of PIEs, district irrigation consultants Community members participated in crop technical cadre on community procurement and engineers of the technical support selection and irrigation scheduling to plan processes, vendor selection and vendor agency) provided backstopping support irrigation infrastructure use during each management. Vendors for installation to community members during the overall cropping season to efficiently use the water of pumpsets (solar/diesel), solar panels implementation of irrigation schemes. resources. Key Learnings Prior to JOHAR’s interventions, Jharkhand monitoring scheme implementation. online updation and transfer of data to lacked projects that focused exclusively on The activities and sub-activities of the facilitate real time informed decision multi-season irrigation. Instituting systems, scheme were mapped with stipulated making in the management of water. processes and building capacity resulted timeframes to connect sequential The approach focused on technology in a huge change from the conventional activities with outcomes. Through this adoption and innovation for all those system of planning, design and process, the project was able to foster engaged in implementation processes implementation that was often susceptible the creation of a skilled cadre of local for improved management, development to ‘elite capture5. irrigation managers. and uptake of solar solutions. II. increased transparency by conducting III. introduced solar solutions, such as the 1) Technology and innovation: geo-tagged surveys to collect GPS innovative cycle mounted solar pump included resilient technologies for improving locations of water sources and (of 0.5 HP) to help small and marginal productivity and reducing climate risk, such pumphouses through geo-fencing of the farmers to irrigate up to 0.5 acres with as: command area of each irrigation site to a discharge of 2-3 liters per second I. improved planning where engineers promote Geographic Information System (lps). Currently, 100 PGs have received used modern tools and skills of project based planning. The innovative online the cycle mounted solar pump-set and management to build replicable and DPR preparation and approval system JOHAR targets to scale this model to scalable systems, and procedures for allowed automatic real time calculations, additional 2000 PGs. 5. Elite capture is a form of corruption whereby public resources are biased for the benefit of a few individuals of superior social status in detriment to the welfare of the larger population. 4 Geo-fencing is a location- based service in which an app or other software uses GPS/ RFID/Wi-Fi/cellular data to trigger a pre-programmed action when a mobile device or RFID tag enters or exits a virtual boundary set up around a geographical location, known as a geo-fence. The geo-fence allows for remote monitoring of MIS of community-based micro irrigation such as when a PG member visits locations or uploads geo-tagged Image Credits: Rohit Jain photographs of installations through the app/software. Advantages of the cycle mounted solar pump Geo-fencing uses GIS based (i) it can be moved to any field location that needs immediate irrigation; technology for field inspection (ii) farmers unaddressed by lift irrigation schemes can use the cycle and aids third party verification mounted solar pump to irrigate their field from a nearby farm pond or by eliminating the need for seepage well, and manual third party verification (iii) the cost of operating a cycle mounted solar pump is minimal process and periodic inspection enabling economically deprived household to access the irrigation by field staff. facility at the local level. 2) Sustainability: was ensured by exchange between the project team and phase and were at the center in all decision I. institutionalizing systems, processes, other government officials helped reduce making processes. tools and guidelines developed within structural overdesign6 and associated the state architecture; and capital costs. 4) Convergence with other schemes and departments: such as II. knowledge and capacity building across 3) Women’s participation: is at the with the agriculture department for micro- all levels and stakeholders. centre of all JOHAR promoted irrigation irrigation system in the command area of projects. Women played an integral the lift irrigation system under the Pradhan Guidelines, specifications and design and decisive role in patch selection, Mantri Krishi Sinchai Yojana (PMKSY), parameters for engineering structures, prioritization of schemes, vendor selection and for solar pumps with the Jharkhand water user association (WUA) mobilization and management, installation of irrigation Renewable Energy Development Agency manuals and training materials, and works, monitoring and command area (JREDA) further facilitated water utilization agricultural extension materials developed development as well as during construction efficiency of irrigation projects promoted were embedded as standard operational of irrigation infrastructure. As a group, under JOHAR as well as extended procedures and made available to farmers they were “empowered” because they had the coverage of irrigation to deprived within and outside the project through access to irrigation, and “ownership” as they households. meetings and website. Knowledge contributed as labor during the installation Challenges Implementation of the community-led small Overcoming the knowledge gap implementation of small-scale lift irrigation scale lift irrigation scheme in scattered and building capacity at all in the remote areas was the existing remote areas had certain challenges. These levels (farmers, engineers and project knowledge gap in selection, implementation included: staff). One of the major challenges in and management of the irrigation systems. 6. Designs of irrigation systems were site specific considering the local hydrological conditions, contrary to a one size standard project design. 5 Customized regular training programs for farmers, local engineers and project staff are needed to bridge the knowledge gap. Sensitization on the importance of solar irrigation versus conventional uses. Farmers and local engineers were primarily aware of diesel or electric based irrigation systems. Installation of solar based irrigation systems created apprehensions regarding duration of operational hours, safety of solar panels, and care and maintenance of solar pumps, which were addressed through village level sensitization workshops. Image Credits: Rohit Jain Overcoming construction issues in some topographies due to the Management of different vendors mapped the tasks of different vendors, and presence of underground rock or hard (pumphouse, solar panel, solar pump, allocated sequential time for completion strata. Community members had to dig out pipes and excavation) had to be done of different tasks for each of their irrigation large heavy stones by hands which was in a sequential timebound manner by sites.   time and energy consuming. the community members. The members CASE STUDY : Community led irrigation scheme under JOHAR project Indrawati Devi, a middle-aged tribal woman with a newly installed lift irrigation system in 0.8 hectares says: “This is the first time that I have access to water in my cropland. Earlier, I use to grow either finger millet or black gram during the Monsoon season or sometimes leave it fallow. But this year I planted high value crops like tomato, cabbage and brinjal and have plans to plant crops like green peas and watermelon in the summer season”. She generated an income of INR 40,000 from 0.2 hectares of tomato crop that she cultivated in the last cropping season. The newly installed lift irrigation system in remote Unchidih village (located at higher elevation) in Basia sub-district of Jharkhand state currently benefits 15 households with irrigation facilities for 8 hectares of cropland. The village has 25 households that primarily cultivated rainfed crop and were entirely depended on rainfall for crop production. The JOHAR project constructed a seepage well of 90 m3 of water volume that provided sub-surface recharge Image Credits: JSLPS from the adjacent perineal stream. A 8 HP diesel pumpset was installed to convey irrigation water to a distance of 500 m through underground pipes and four outlet points. The community plans to retrofit the system to solar power to reduce operational costs. Community members of Unchidih village collectively constructed the seepage well, pumphouse, underground main line installation and configured the outlet points under the guidance of the technical team. Community members have collectively formed an informal producer group, called Rani Mahila Kisan Utpadak Samuh, for overall management and farming operations in their village. There is also a water user group for water sharing and grievance redressal. Community members received customized training sessions on patch selection, crop planning, cost estimates, package and practices of high value crops and management of irrigation infrastructure. They have developed plans for planting selected crops in the command area of the lift irrigation system to judiciously use the irrigation facility. They take minimal operational charges on an hourly basis from each member serviced from the lift irrigation system to meet any maintenance costs. The technical service provider at the village level is responsible for operating the pump on a daily basis. 6 Way Forward JOHAR project plans to undertake more than 2000 similar small-scale lift irrigation schemes covering more than 18,000 hectares of land with irrigation facilities in the next two years. Due to bio-physically suitable locations and endowment of a dense network of small seasonal streams, the small-scale lift irrigation system is emerging as a model to ensure accessibility and availability of irrigation facilities in remote water-deprived areas. For effective monitoring, risk mitigation and allocation of responsibilities, JOHAR is developing a management information system (MIS) to track location-specific work progress on a real-time basis. JOHAR is planning to introduce an Android application for improving the irrigation monitoring system to regulate pump operations from any remote location. The application will also enable the identification of major Image Credits: Rohit Jain issues and faults of the irrigation pump. An schedule irrigation and create a database other departments outside the project, the irrigation monitoring application will help for efficient planning and management of project team is training state engineering local community members to efficiently irrigation. In response to requests from cadres to provide technical support. ABOUT THE DISCUSSION NOTE SERIES This note is part of the South Asia Agriculture and Rural Growth Discussion Note Series, that seeks to disseminate operational learnings and implementation experiences from World Bank financed rural, agriculture and food systems programs in South Asia. Authors: Pratyush Singh, Stuti Sharma & Bipin Bihari Series editor: Vani Kurup Publication Design & Illustrations: Parth Varshney We are grateful for the generous support from DFID. Disclaimer: The findings, interpretations, and conclusions expressed in this note are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its affiliated organizations or to members of its Board of Executive Directors or the countries they represent. South Asia Agriculture and Rural Growth Discussion Note Series Mar 2020 Public Disclosure Authorized 1 12 BUILDING LAST MILE LIVESTOCK SERVICES FOR RURAL COMMUNITIES IN JHARKHAND, INDIA Public Disclosure Authorized Key achievements 1,020 ‘Pashu sakhis1’ (or livestock friends) trained, accredited and equipped to deliver services to improve livestock productivity and help farmers access markets. 70 percent of targeted households (i.e. 39,900) increased marketable surplus of select meat and eggs and are expected to achieve targeted net profits for goat, layers and dual purpose poultry (Kuroiler) mother units of at least INR 1 lakh2 annually; and pig, broilers and small scale Kuroiler delivering INR 65,000, 42,000 and 14,000, respectively. 100 percent female beneficiaries and service providers (Pashu sakhi). Public Disclosure Authorized Context Role of JOHAR in Livestock Livestock is one of fastest growing sectors and services that mostly focus on cattle and Interventions and is a promising high-value option for buffalo. landless and marginal households. Market Matching grants to support Jharkhand’s livestock production is in the prices in India for meat and eggs have procurement of improved stock hands of marginal and landless farmers with and establishment of pig and goat increased by 70–100 percent in the past women accounting for over 70 percent of breeding villages and poultry units decade in local markets and have also the production. The JOHAR4 project aims pushed up farm gate prices. Diversification Housing demos for goats, pigs and to enhance and diversify household income poultry to high-value options such as livestock through the livestock component to target could more than double household primary Revolving loans to support nearly 57,000 beneficiaries for enhancing income. working capital for beneficiaries to productivity and accessing markets in purchase inputs and services like Livestock productivity has been low in selected value chains (broilers, layers, pigs, feed and vaccination Public Disclosure Authorized Jharkhand however; less than 12 percent goats and dual purpose backyard poultry). Organizing beneficiaries into of that in leading states3. Livestock farmers Given the major role of women, especially producer groups and forming have traditionally suffered very high levels of from marginal and landless households, producer organizations to enable mortality (over 30 percent loss of goats, and JOHAR livestock activities target over 90 services and inputs delivery and up to 80 percent of pigs and poultry) and percent female beneficiaries. market access low levels of productivity (egg production Maintaining livestock service While local service providers are an <30 percent of potential, and meat animals centers to support access to important feature in all livestock related inputs, services and aggregation requiring vastly long times (4–6 times) to investments the Bank finances, the hubs, and to operate on cost reach ideal market weights). Smallholders JOHAR model is believed to be the most recovery basis lack access to key services like advisory, comprehensive and successful of all. Training and equipping cluster level training and access to quality inputs This note highlights JOHAR’s livestock managers/paravets supporting nutrition, health, breeding and management. The ratio of veterinarians/ activities, the JOHAR Pashu sakhi model, Providing beneficiary training paravets to livestock in the state is amongst lessons learned and what makes the through farmer field schools the lowest in India, with limited resources JOHAR model different. 1. Pashu sakhis or livestock friends are community service providers offering inputs, advisory supporting productivity (breeding, feeding, animal health), farmer training, market linkage and risk mitigation. 2. INR 1 lakh is highly significant given that baseline household incomes are INR 45,000. 3. Chand R and Parappurathu S. Historical and Spatial Trends in Agriculture: Growth Analysis at National and State Level in India. IGIDR Proceedings Series, National Centre for Agricultural Economics and Policy Research, New Delhi. 2011. 4. Jharkhand Opportunities for Harnessing Rural Growth (JOHAR). 2 While local service providers are an important feature in all livestock related investments the Bank finances, the JOHAR model is believed to be the most comprehensive and successful of all. there are major differences in the approach, orientation and purview of work of these Image Credit : Rohit Jain health workers. Three models exist in India for delivering livestock services to farmers: Building the capacity of local women to labor force participation in the world5). be ‘Pashu sakhi’ seems to offer a solution Initiated in the early 2000s, there are now I. traditional model (mostly government to improve livestock productivity and help about 15,000 Pashu sakhis across India, veterinary services), farmers access markets. Pashu sakhis earn over 6,300 in Jharkhand6, and 1,020 under II. standard model, and income as entrepreneurs selling services JOHAR. III. JOHAR model. and inputs (very important in India which Pashu sakhis are adopted in many states, The major differences in these models are has amongst the world’s lowest women agencies and projects across India, but described on page 3. Interventions Each Pashu sakhi delivers services and control, castration, first aid and referral offering this service. This has led to a inputs to about 50-100 farmers, and to vets for challenging cases — for change in attitude of farmers to undertake upwards of 1,000 livetock supporting health; timely castration of animals, and the ability productivity, market access, farmer training II. feed and water advisory and supply of to identify key production traits in the new- and risk mitigation. Because many Pashu mineral mix and other supplements, born. sakhis work part-time, they can effectively climate tolerant fodder saplings and Farmer training and advisory in cover a maximum of 100 farmers and 1,000 seed, and climate mitigating fodder JOHAR is central to project success and livestock while receiving good remuneration. storage approaches — for climate adopts the farmer field school approach Services and inputs provided by Pashu smart feed storage; whereby the Pashu sakhi organizes regular sakhi comprise: III. advise and collection of records get-togethers at different farms, and farmers Market access support through in breeding villages to support meet to learn skills (‘learn to do by doing’) supporting organization of farmers into performance recording and selection covering the above areas, which the Pashu producer groups; maintaining records to of outstanding breeding animals — for sakhi then supports with services and identify animals that have reached ideal breeding; inputs. Because the Pashu sakhi is a part market requirements; providing a link IV. advisory and assistance in demo of the farming community, she can readily between farmers, producer groups and housing construction, farm hygiene and follow-up with farmers to remind them of traders; advising farmers on preparing waste management — for housing. the new skills and lessons learned. Farmer animals for market/production cycle training to develop and help them practice management; advising farmers on market new skills is a long-term activity. The farmer Establishment of breeder villages prices; supporting grading and weighing field school approach supported by Pashu through performance recording and of animals so that farmers are in a better sakhi has led to high adoption rates of new selection of top males for breeding based position for negotiation; and supporting productivity and marketing practices. on defined techno-economic parameters. filling buyer/trader orders for animals of The Pashu sakhi trains and increases specific breed, sex, age, weight, color, etc. While the three main risks related to disease, awareness among farmers in breeder climate and markets are dramatically Comprehensive productivity villages about the importance and economic reduced by services and inputs (see box enhancing services and inputs benefits of rearing breeding stock for use on page 5), the Pashu sakhis also support such as: and sale. Castration of low performing adoption of livestock insurance and claims. I. vaccination, deworming, ectoparasite animals is practiced, with the Pashu sakhi 5. National Rural Livelihoods Mission.2019. Feature story: Working for Women in India. www.worldbank.org Less than a third of women – 15 years or older – are working or actively looking for a job. 6. Nearly all recruited and trained through the Jharkhand State Livelihoods Promotion Society. 3 Comparison Traditional system Standard Pashu sakhi JOHAR Pashu sakhi criteria before JOHAR program model Service centralized at Service at farmer’s Service at farmer’s Service location dispensary or hospital doorstep doorstep Focus on small Focus on large Focus on small ruminants (goats, Livestock focus ruminants: cows and ruminants: pigs and sheep): pigs and buffalos poultry poultry Focus on prevention, Focus on prevention, Treatment focus Focus on treatment improved practices improved practices and management and management Services focused on Services include Full range of services vaccination for foot- vaccination, include comprehensive and-mouth disease deworming, sale of support for productivity Service focus and artificial insemination feed supplements, weighing enhancement; improving of animals to inform market access to markets; training prices (some programs also farmers; risk reduction through support farmer training as in insurance Jharkhand) No animal tagging All animals tagged. An No animal tagging precluding accurate App based system to precluding accurate Service records records of treatment, record all treatments, records of treatment, vaccination, services rendered (still vaccination, etc. conception in development stage) Limited training duration Training duration 1-3 days common, 3-7 days training 30 days training sometimes up to 7 days Master Trainer No requirement Trainer Animal specially trained as Trainer specifications that the trainer be a Husbandry staff or trainer, selected on training professional NGO skills and experience No requirement to No certification of Master Trainer certified assess ability of trainers Master Trainer through Agriculture involved in training Skill Council of India Credentials of the farmers. No assessment of (ASCI) trainer effectiveness of training based on farmer adoption of practices/ knowledge; no assessment of increased productivity or profitability from training Credentials of Pashu No certification sakhi (or traditional requirement for the No certification Certification through Community Animal service provider / or requirement ASCI Health Worker) trainer No focus on women to Over 95 percent Over 95 percent Gender focus deliver services female female 4 JOHAR targets over 1,020 Pashu sakhis (99 sakhis (90 percent women). The key steps implementation of the Pashu sakhi model percent women), and 29 Master Trainer Pashu and considerations required for successful are described and summarized in the box. JOHAR Pashu sakhi model The Pashu sakhi model in JOHAR is believed to offer the first accredited and potentially most comprehensive and sustainable model in the country. Pashu sakhis, meaning ‘livestock friends’, are critical to providing door-step services and inputs to farmers to support productivity, market access, farmer training and risk mitigation. Pashu sakhis are enabled through Technical Service Support contracts7. The Jharkhand Women’s Self Supporting Poultry Cooperative Federation Limited supports commercial poultry implemented as a turnkey operation; and Asset & W/Heifer International supports Master Trainer Pashu sakhi, Pashu sakhi and farmer training, capacity building and technical advisory support for goats, pigs and backyard poultry. MoUs with private sector suppliers provide quality inputs, such as Kuroiler chicks by Kegg Farms, vaccine by Hester and other productivity enhancing inputs like mineral mix and feed supplement. Technical service provider offers training-of-trainers (ToT) and coaching. Heifer International’s India subsidiary Asset & W were contracted to select and train Master Trainer Pashu sakhis (Heifer has over 10 years of experience in training Pashu sakhis in India). They also provide coaching and handholding support in: the selection and training of Pashu sakhis, Pashu sakhi supported services and inputs delivery, demos conducted by the Pashu sakhi and farmer training. A total of 29 Master Trainers were selected according to the following criteria: (i) Pashu sakhi with proven training skills based on earlier experience with farmer training, (ii) hands-on experience with livestock, (iii) female 30-45 years of age, (iv) education: 10th pass and above, and (v) ability to travel to different parts of the state. Selection criteria. Pashu sakhis are selected from the farming community to enable timely services and follow-up; and also because they most often have experience raising livestock themselves. Nearly all are women (>95 percent), preferred for reasons of sustainability and skills, and found to offer higher quality of service. Pashu sakhi training and certification.They are trained in batches of 15-20 by Master Trainer Pashu sakhis. Each receives 30 days of training over 18 months in 5 sessions of 4–7 days each. Training content is similar to Master Trainer Pashu sakhi training and covers all roles and responsibilities. After the completion of the third training session and 6 months of experience, the Pashu sakhi is eligible to take the ASCI certification examination. Further preparation for the certification is provided by ASCI over a period of 7 days. The cost for training a Pashu sakhi including the costs for training the Master Trainer Pashu sakhi in ToT mode, is INR 75,000 per Pashu sakhi. This includes accommodation, travel costs for the Pashu sakhi and all associated training costs such as services of Asset & W in preparation of materials, training Master Trainers and coaching support for Pashu sakhi. ASCI certification offers several benefits. Firstly it professionalizes the Pashu sakhi, and offers a way to standardize the quality of Pashu sakhis across the country. Certification of Master Trainers offers the added benefit that they are recognized as highest quality professional trainers and can work anywhere in India. Equipment supplied to the Pashu sakhi. Fundamental to providing support is the provision of equipment which includes a smartphone and a kit containing a blue sari, apron, hat, cool box for carrying medicines, weighing scales, castrator and a basic initial stock of supplies to support first aid. Ayurvedic treatments are provided when available. The cost to equip each Pashu sakhi is INR 5,000 for the kit and another INR 5,000-7,000 for a smartphone accruing to a total of about INR 12,000. After the first inventory of supplies is provided, the Pashu sakhi earns income to maintain her stock of supplies which she purchases from the Livestock Service Center. Institutional support, monitoring and evaluation. Emergency back up support (such as for a broken leg or complicated birth) is provided by the project and local veterinarians. This referral service that operates through smartphones and WhatsApp also enables vets to focus their time on cases they are best trained to handle. A Pashu sakhi’s delivery of services and inputs is monitored by the farmer producer group through broad criteria such as number of farmers trained by them; number of animals marketed; and number of animals vaccinated. An App can support service delivery as well as monitoring and evaluation. Connection to input supply to access quality timely cost effective inputs. Producer groups operate a Livestock Service Center, which serves about 1,000 farmers and enables the capture of data on economies of scale due to bulk purchase. Each Livestock Service Center supports about 8-10 Pashu sakhis who restock from these Centers where feed inputs like mineral mix and supplements are stocked, and cold chain is provided for vaccines. The Livestock Service Center also provides an aggregation point for meetings, training and marketing support. However, if a Livestock Service Center has not yet been established, the Pashu sakhi is oriented to be able to identify quality cost-effective inputs from agro-vet shops. 7. These are contracts awarded to the partner organization that undertook capacity building efforts; in this case Heifer International – the very best organization involved in the training of Pashu sakhi. 5 A detailed breakdown of the services offered service areas – marketing, productivity mitigation are presented below. by the Pashu sakhi for the four broad enhancement, farmer training and risk Service Area Service/Role • organization of farmers into producer groups • animal identification and record keeping • inventory of animals for market • facilitating trader contact point and link between farmers, producer groups, so traders can access animals according to number and specifications (such as Marketing weight, age, breed, sex, color, vaccination and health status) • advising farmers on preparing animals for market/production cycle management • advising farmers on market prices • weighing animals • facilitating castration to enable higher prices • facilitating vaccination • deworming and ectoparasite control • facilitating castration • providing first aid and referral to vets for challenging cases • ensuring climate smart feed sampling • providing feed and water advisory • supplying mineral mix • supplying other feed supplements Productivity • supplying climate tolerant fodder saplings and seed enhancement • demonstrating fodder storage approaches • giving breeding advice on selection of high quality breeding animals • collecting records in breeder villages to support performance recording and selection of outstanding breeding animals • giving housing demos and advisory • advising on farm hygiene and waste management • organizing monthly training sessions to train farmers in batches of 20-25 • ensuring farmer participation for 4-8 training sessions to learn skills necessary Farmer training for improved feeding, animal health, breed improvement, housing and water through farmer availability, farm hygiene; producing animals for market demand field schools • providing ongoing coaching to farmers • organizing exposure visits to aid peer-to-peer learning Risk • helping producer groups to access livestock insurance mitigation • assisting farmers with insurance claims The key outputs tracked are number of: through producer groups. Value addition is expected to achieve targeted net profits for producer groups formed; service centers through providing quality eggs and healthy goat, layers and Kuroiler mother units of at established; Pashu sakhis trained and market animals of consistent size and least INR 1 lakh annually; and pig, broilers equipped; breeding bucks and boars numbers according to market demand. and small scale Kuroiler delivering INR supplied; farmers trained; farmers with The key outcome was that 70 percent of 65,000, 42,000 and 14,000, respectively. improved shelters; animals vaccinated; targeted households increased marketable and goats, pigs, eggs and birds marketed surplus of select meat and eggs and are 6 Key Learnings Master Trainer Pashu sakhis Empowerment and entrepreneur sakhi through biweekly meetings builds effectively train Pashu sakhis. training are critical to revenue confidence and support and offers a peer Master Trainers travel within the state and generation and sustainability. mechanism for problem-solving. stay overnight for several nights at village Sustainability of Pashu sakhi relies on a training sites. Master Trainers are certified viable revenue model based on charging Access to quality, cost-effective by Agriculture Skill Council of India (ASCI) fees for services. Two years into the JOHAR and timely inputs in adequate with the same test that is used to certify Pashu sakhi program and after about quantity through Livestock vets or paravets. The most effective Master 6 months of field practice, each Pashu Service Center according to a Trainers are: Pashu sakhis with 2-3 years sakhi initially covers about 50 animals viable business model. It is critical of experience, and ideally women as they monthly owned by 50 farmers in 1-2 to connect Pashu sakhis to the input supply also have experience in livestock rearing. villages, with the aim to double this. There chain that assures sufficient quality, quantity Master Trainers also enable sustainable is considerable variability in earnings from and timely availability of feed and nutrition expansion of the Pashu sakhi program over INR 6,000 to INR 12,000 per month inputs, as well as vaccine and animal health after the project ends. Government Animal based on availability and experience of inputs (like dewormer). Bulk purchase of Husbandry Department staff often do not the Pashu sakhi; they receive a subsidy inputs by the producer group and making have the required skills and knowledge in of INR 1,200 per month during the initial it available through the Livestock Service diverse areas for supporting productivity 2 years until they can establish their Center where the Pashu sakhi can access, enhancement, marketing, farmer skills business. Earning success is enhanced by is not only cost-effective, but also enables development and risk management to empowerment and entrepreneur training, suitable storage, including refrigeration for be Master Trainers. Vets/paravets are which builds confidence, provides charge vaccines. The Livestock Service Center not officially certified by ASCI as Master rates for suggested services, as well as is managed by the farmer producer Trainers. builds capacity in managing inventory organization. The Livestock Service Center and finances. Ongoing coaching of Pashu is a new innovation that supports market Image Credit : Rohit Jain 7 aggregation, access to inputs and also Currently 300 Pashu sakhis have reached One of the major challenges is the lack of serves as a demo and training hub. the necessary training requirement for ASCI timely diagnostic services and emergency certification, and have been certified based support services from the Animal Husbandry Impact on productivity on both an online test and oral examination Department. Options for an effective and dramatically higher than by veterinarians contracted by the ASCI. sustainable approach to diagnostics are anticipated. Project data showed that being explored. mortality among livestock before JOHAR, Use of social media application which was upwards of 35-85 percent, got “WhatsApp” has proven reduced because of services offered by extremely successful for peer and Pashu sakhi. emergency support. WhatsApp is used to share good practices among Pashu Certification rate is nearly sakhis; both video clips and photos are 100 percent and higher than taken to share experiences. WhatsApp has expected. This is because of the careful been vital for providing timely emergency selection of Pashu sakhis by producer backup support to Pashu sakhis to receive groups and the excellent training by the advise on actions to take or resolve Technical Service Provider, which resulted challenges. in 100 percent of them being certified by ASCI. The Pashu sakhi model Pashu sakhis are ready for certification by in JOHAR is believed to ASCI after the third training session and 6 offer the first accredited months of experience. Pashu sakhis are effectively trained over 3 sessions of 7 days and potentially most each, and each of these sessions covers comprehensive and new skills related to productivity (feeding, sustainable model in the animal health, housing and management, country. farmer training and market support). Image Credit : Helen Leitch 8 Way Forward An alternative strategy to support disease diagnostics is under development that will make maximal use of cheap, accessible diagnostic kits and low cost technology like famacha cards to assess parasitic infection to inform deworming regimen. Private diagnostics labs may also prove to be a viable option. An App-based decision support system for supporting disease diagnosis would also be useful. Emergency veterinary services alternatives are being explored (to support cases such as difficult kidding problems or undiagnosed diseases), via Corporate Social Responsibility (CSR) initiatives that support emergency animal health services. Image Credit : Rohit Jain Opportunities for better The JOHAR Pashu sakhi model is Trainer Pashu sakhi cadre, facilitate integration with Animal being expanded to other states training and equip Pashu sakhi to support Husbandary Department are through new project financing to firstly hire productivity, market access, farmer training being explored to support animal an experienced technical service support and risk management. Lessons learned are health services more broadly in the state, organization to build capacity of a Master being shared broadly. and monitor animal health coverage. ABOUT THE DISCUSSION NOTE SERIES This note is part of the South Asia Agriculture and Rural Growth Discussion Note Series, that seeks to disseminate operational learnings and implementation experiences from World Bank financed rural, agriculture and food systems programs in South Asia. JOHAR livestock activity was designed supervised and implimented with technical support through the joint program with UN Food and Agriculture Organization (FAO). Authors: Helen Leitch, Abhinav Gaurav & Bipin Bihari Series editor: Vani Kurup Publication Design & Illustrations: Parth Varshney We are grateful for the generous support from DFID. Disclaimer: The findings, interpretations, and conclusions expressed in this note are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its affiliated organizations or to members of its Board of Executive Directors or the countries they represent. South Asia Agriculture and Rural Growth Discussion Note Series Mar 2020 Public Disclosure Authorized 1 13 LEVERAGING FARMER PRODUCER COMPANIES TO TRANSITION TO MARKET- BASED PRODUCTION SYSTEMS IN JHARKHAND Public Disclosure Authorized Key achievements JOHAR’s1 strategic marketing interventions to support Farmer Producer Companies (FPCs) increased sales for poultry and tomatoes 19 FPCs, covering 1.4 lakh households, promoted to avail quality Public Disclosure Authorized inputs and access more lucrative output markets Context Small and marginal farmers in India struggle for access to good quality inputs in farming of crops (seeds, fertilizers, crop protection) and livestock (stock species, breed, density, feed consumption); credit; market acceptance (such as for a new product); connectivity (for bulk marketing); and storage facilities. Aggregation of farmers Public Disclosure Authorized into Farmer Producer Companies (FPCs)2 has shown to overcome many of these problems. JOHAR has planned to promote 30 FPCs membership base (7,000–8,000 per FPC), covering 2 lakh households of which shareholder composition (only women), JOHAR FPCs are unique 19 FCPs are operational, to enhance and product basket with produce that helps compared to existing ones agricultural incomes of rural producers by double incomes. because of their huge increasing productivity, improving market Ensuring market access would further boost membership base (7,000– linkages and providing value addition. farmer livelihoods. For this, it is important for FPCs formed under the JOHAR project 8,000 per FPC), shareholder FPCs to have sustainable market linkages were successful in increasing production composition (only women), with different types of buyers, such as and farmer incomes by opening up a new wholesale markets (intra- and inter-state), and product basket with source of earning. modern retail chains, business-to-business produce that helps double JOHAR FPCs are unique compared e-commerce players and corporates dealing incomes to existing ones because of their huge with food processing. However, capacities 1. Jharkhand Opportunities for Harnessing Rural Growth 2. Many organizations such as NABARD, SFAC, FORD Foundation, Rabobank Foundation, HIVOS, State governments, Tata Trust and Corporates have taken initiatives to support the promotion, registration, and growth of these FPOs. In the process, thousands of FPCs came into existence throughout the country. 2 of FPCs may not be sufficient to explore and logistic functions have to be developed. This note includes experiences and and maintain such linkages. FPCs thus For this, linkages with institutional buyers learnings of the implementation of marketing require guidance and support in the initial and development of marketing strategies initiatives for: (i) a new poultry product, stages as systems and processes need to for the brands to be promoted by the FPCs and (ii) increasing the marketing of tomato be followed to capture markets. Systems on need to be initiated at the state level. produce through post-harvest management procurement, sorting, grading, packaging practices and technologies. Problem Analysis: Kuroiler3 Kuroiler (a breed that produces more eggs sold for meat), is being promoted in the income of beneficiaries by selling of live than the native or desi breed can also be JOHAR project to increase household birds. JOHAR Kuroiler has the following advantages over broiler: • Less food safety risk as it is less exposed to antibiotics • Reared in natural semi-intensive environment • High content level of protein, calcium and vitamin • Low level of fat content; and flesh and tastier meat Characteristics Kuroiler Desi Color Multi-color Multi-color Annual egg laying capacity 150 40 Time needed to start laying 22 weeks 33 weeks eggs Weight after 6 months Male: 4 kg, Female: 2.5 kg Male:1 kg, Female: 1.2 kg Food requirement Normal household food Normal household food Bird price per kg (INR) 140 250-300 (wholesale) 3. Kuroiler is a hybrid breed of chicken developed by Keggfarms Group in Gurgaon, Haryana during early 1990s. It has been derived from crossing over either Coloured Broiler male with Rhode Island Red Female or White Leghorn Male with Rhode Island Red Female. 3 However, various poultry wholesale markets De-motivating for farmers as they Competition from substitutes such in and around Ranchi had low demand for could not envision the benefits of rearing as Cockrail (another poultry breed very Kuroiler resulting in it selling at the price of Kuroilers due to low price realization and similar to desi breed). a broiler. The reasons for the low demand sales volumes, because it was being sold at were attributed to existing market dynamics the price of broilers or as an adulterate. Absence of retailers accepting and customer perceptions regarding Kuroiler; except a few counters where Kuroiler, such as the following: Lack of customer awareness about adulteration was noted. Kuroiler made it unpopular with producers It is considered an adulterate and to consumers. Confusion in positioning of of the native (desi) breed which Kuroilers because these birds were resulted in very low number of these birds Lack of product validation before neither considered premium like desi birds sold per day. entering the market resulted in poor nor like broilers in the marketplace. Farmers understanding and communication about were incurring high cost of production with Lack of rearing of Kuroiler for the added value proposition of Kuroilers respect to broilers (popular backyard poultry commercial viability through FPCs or over broilers and desi breeds, and hence, bird) and were expecting to sell Kuroilers at cooperatives did not secure it as a product FPCs were not able to create a pragmatic the price of desi birds. category in the marketplace. market entry strategy. Rearing cost for Kuroiler is higher than that for the broiler breed. Rearing for 15 days at the mother unit incurs a total cost of INR 39.50; rearing for another 30 days at the rearing unit incurs a total cost of INR 85–90 and by this time period a chick develops into a bird weighing 1–1.25 kg. However, the market was offering just INR 90–100 for a kg (i.e. at same price as that of broiler). Interventions: Kuroiler Market positioning and segmentation. The FPC targeted the Geographic Segmentation educated consumer in the age group 30 plus years with a sedentary job or lifestyle, dwelling in urban posh areas of Ranchi Ranchi Urban Posh Areas city to position Kuroiler meat as safe for consumption. Pricing mechanism. Kuroiler appears as an alternative to the native (desi breed) bird which can be available to consumers at an affordable (comparatively cheaper) rate. Demographic Segmentation Thus, it was planned to manage pricing to a maximum retail price of INR 200 per kg so that the retailer could profit by a margin of Age: 30+ Educated Class Occupation: Sedentary Job 43 percent with FPC and as a member or grower profit by 12 percent and 25 percent, respectively. Positioning in retail outlets. Through a buyer-seller meet, 10 retailers Psychographic Segmentation were chosen and provided a 3 feet length, 6 feet width, 2 feet depth cage each, at no cost for their retail counters. They were also Health Lifestyle: Consumer in search supported through promotional materials. Conscious Extravagant/ for a fleshier & better Depending upon the retailer’s demand, Consumer Lavish taste birds were supplied at their doorstep. 4 Mother Unit Rearing Unit Trader/Dealer Wholesale/ Consumer Retailer Premium product: Premium product: Due to JOHAR’s intervention Showed readiness to incurs high incurs high Kuroilers were positioned as a Enhancement in pay higher price production cost rearing cost premium product; and traded brand image and sold on a higher margin at premium More Transfer of Values Streamlined supply of birds. Murhu birds in plastic cages. Losses incurred due to communicate that Kuroiler meat is safe Nari Shakti Kisan Producer Company Ltd. to mortality and shrinkage during and available readily. Each retail outlet/ was given the responsibility to ensure a transportation were borne by the FPC. counter was provided with pamphlets and regular supply to the 10 retail outlets. The standees to communicate the benefits FPC took responsibility for the arrangement Marketing communication. Regular of consuming Kuroiler meat and its of logistics, weighing and loading of news items were published in newspapers advantages over other substitutes. Problem Analysis: Tomato Marketing Tomato was selected as one of the key percent), usually sold through modern retail adds to wastage due to mismanagement vegetables to be grown because it: (i) outlets (such as Reliance Fresh, Spencer’s) and damage during transportation. can be cultivated in all seasons and in all are sourced from other states. types of lands, (ii) has a good shelf life, Produce from local farmers growing tomato Jharkhand’s varied (iii) is conducive for high scale production, varieties are not accepted due to lack of (iv) provides a good profit, (v) can be sold topography and climatic product standardization. Inconsistency in through all types of channels, and (vi) has tomato varieties is due to huge variation in zones allows growing of an established market both within and seed types used by the farmers. Moreover, tomatoes even during off- outside the state. farmers who produce tomatoes in small season Jharkhand’s varied topography and climatic volumes sell in local markets at retail price zones allows growing of tomatoes even and do not know the benefits of trading during off-season. The majority of farmers through FPCs. Size and weight variations In addition, farmers in Jharkhand prefer under JOHAR grow cooking variety lead to weighing of each crate before sales to know the selling price of their produce tomatoes accounting for 60 percent of the adding to the selling cost, which annoys before committing to sales and usually market share. Salad variety tomatoes (40 buyers. Sometimes, overloading of crates choose to settle for a stable lower price over 5 an unstable higher price. They also prefer to such as demand estimation (seller and manner. Furthermore, not having adequate collect cash at the time of transaction. FPCs buyer), price information, demand fulfilling, number of staff at the FPC office, and not do not prefer transacting in cash as it could Goods Receive Note issue, payment to having a financial management system for lead to malpractices. farmers, credit management, as well as data producer groups and FPCs resulted in many In the beginning, aspects of agri-marketing validation/reporting were done in an ad-hoc inefficiencies during operations. Image Credit : JSLPS Interventions: Tomato Marketing Agri-marketing on a large scale consists of Company Limited. Post workshop, three Package of Practices to create standardized key activities such as demand estimation rounds of data validation exercises were products. In addition, to growing popular from buyers and suppliers, quality and price conducted for realistic production data. salad varieties (Vaibhav and Vaishali), verification, demand aggregation, billing, Based on refined data, prospective buyers discussions were initiated with interested logistics and payments. A technical support were contacted by the FPCs. organizations for conducting pilots for agency (TSA) with experience of setting Intense handholding support to the three varietal trials. up processes for agri-marketing was hired FPCs was planned for execution of agri- to set up processes for FPCs and train marketing activities. FPC staff and board Streamlining supply. A new FPC staff to operate in a process driven members were able to positively influence parameter called ‘number of saplings environment. farmers to sell through the FPC and transplanted’ was introduced to achieve During the peak operation season, mobilize produce from farmer members more accuracy in calculating the number many FPCs did not have accounts and through the following strategies: of plants and in turn, expected yield. FPC computers. A marketing plan workshop was collection centers (CCs) were planned at conducted to set up targets for three FPCs Establishing product segments. strategic locations in existing trade routes to – Murhu Nari Shakti Kisan, Dakshin Koel FPCs in JOHAR started providing inputs have better access to farmers for inputs and and Churchu Urja Shakti Kisan Producer (seed, fertilizer, and crop protection) and output sales. Physical presence of FPCs in 6 the form of CCs infused confidence among FPC farmer members to access a definite buyer/seller and switch from their existing trading partners. Demand aggregation. The Board of Directors were tasked to participate in monthly farmer group meetings to explain the benefits of selling through FPCs. Haat campaigns were organized for each local haat, where FPC products were displayed, new farmers were mobilized and prospective suppliers traced for aggregation. Packaging. Farmers were trained both on- and off-field to provide graded products with a uniform weight in FPC-provided crates. A regular training and messaging system for quality and weight reminders showed benefits in the marketplace. Price discovery. Synergy Technofin (TSA for agri-marketing for JOHAR) did a three-month pilot to list the critical features and design requirements for developing a market intelligence system. The current offline system collected data from all relevant markets related to tomato trading for JOHAR FPCs. The proposed market intelligence App would provide pricing information to farmers at their doorstep. Payments. Commercial wallets were used for instant payment to farmer’s bank accounts (with a fee of INR 5 for INR 1,000 transaction value). It was operated manually to pay farmers instantly. Chief executive officers and accountants were allowed to hold cash value equal to their monthly salaries for immediate cash payments. This would help new farmers to gain confidence in transacting with FPCs. After a few rounds of transactions, these farmers will be motivated to transact digitally with FPCs. Image Credit : Synergy Technofin Pvt. Ltd. Setting up business processes. for transparency and accountability for engagement activity to motivate farmers to Accountants (hired on priority basis segregating procurement activities from feel connected with the FPCs and in turn and trained on operating Tally) created trading activities. sell their produce via them. Because of the standard line items to capture revenue marketing plan’s match-making process, and cost, leading to standardization, which Marketing plan. A data validation farmers obtained practical experience of resulted in significant improvement in exercise was planned to ascertain realistic understanding time, quality, packaging and reporting frequency and time. A Financial numbers at the right time for execution of payment requirements of different types of Management System was designed the marketing plan, and initiate a customer buyers. 7 Key Results JOHAR’s strategic marketing interventions FPC successfully placed 1,700 birds ready to offer a price of INR 130-132 per to support FPCs increased sales for poultry and recovered more than 70 percent of kg at the farm gate. and tomatoes. payments within one month of starting ࢠࢠ 263 metric tonnes of tomatoes worth INR operations. ࢠࢠ Strategic marketing interventions created 5.1 million were sold by the three piloting an increase in demand for Kuroiler. ࢠࢠ Increasing demand from retail markets FPCs during the intervention period by On alternate days, the FPC received a pushed the wholesale market to following process-driven aggregation demand for about 150-200 birds, and restructure its benchmark pricing for and sales. on Sundays it increased to 250 birds. Kuroilers. As a result, a wholesaler was 2019 September October November December Number of birds 1,077 790 907 1,145 Weight (Kg) 982 742 877 1,111 Sale was high on Sale started with an Low stock of birds was account of Christmas expected jump due to Sale dropped due to Reason noticed at the rearing and New Year and promotional activities in onset of festive season units severe winter (non- print media vegetarian eating trends) Time period of data: September to December 2019 8 Key Learnings ࢠࢠ FPC was able to capture and monitor plans. counting number of live plants and their data related to mortality and shrinkage in expected yield in a periodic manner to ࢠࢠ Simple principles related to sorting, weight for each transaction. This helped increase the accuracy related to tomato grading, and packaging helped FPCs to the FPC to set standards for operational availability. create a niche for tomatoes in wholesale efficiency during transportation. markets. This created a positive impact ࢠࢠ Bringing FPCs and market leaders ࢠࢠ A clear positioning strategy aided with on farmers to supply graded products. together through a buyer–seller meet to regular communication in mass media explore possibilities for each other is an ࢠࢠ Rural business hubs were positioned helped retailers to accept Kuroiler as effective way to build relationships and as a strategic tool which operated as a premium product and increase their start transactions. Hence, a buyer–seller permanent CCs for both inputs and order size for chicks. meet was organized with market leaders, outputs. This physical proximity to such as Big Basket (Kolkata), Big ࢠࢠ Regularly educating FPC members farmer locations helped farmers in Bazar (Kolkata), Nature’s Cart (Ranchi), about customer preferences and quality addressing initial trust issues related to Reliance Retail (Ranchi), Mother Diary adherences, and providing training procurement and payments. In addition, (Ranchi), Spencers (Kolkata), SMP to respond to these market demands rural business hubs became focal Agro (Ranchi) and Jubilant Consumers resulted in increase in number and points for communicating the benefits (Noida) to initiate market led production volume of transactions. of transacting with FPCs and motivating and delivery systems and processes. farmers to join FPCs. ࢠࢠ Need for market driven production to This event not only cleared the doubts meet the significant demand for table ࢠࢠ Initially, tomato availability in any cluster of FPCs relating to transaction activities variety tomatoes in Jharkhand. Standard was calculated based on the number such as quality requirements, payment varieties are not grown locally and as a of tomato samplings distributed and terms and conditions, and logistics but result these varieties are sourced from their expected yield as suggested by also gave confidence and vision to adopt far away states such as Karnataka and experts. These data were not helpful these practices that are followed by Andhra Pradesh. Hence it is important to to the marketing team as real outputs private sector players. conduct market assessment to find gaps have large deviations. Later, yield and accordingly reshape production calculation method was changed by Image Credit : JSLPS 9 Challenges Existing relationships between network. FPC’s procurement practices are FPC attained enough production during farmers and local traders. different from that of traders, which are mid-September, demand declined due to Local traders source products from farmers generally exploitative in nature. To break onset of the Durga Puja festival. FPC was either by pre-booking through various this nexus between farmers and traders is a forced to hold the inventory during this time instruments such as supplying seeds, huge challenge. and started supply of birds after the end inputs, and offering token amounts as of the festival when demand for birds was advance or by paying cash at the time of Unable to match demand and revived. purchase. These relationships are age-old. supply during festival season. FPC is not only a new entity in the market There was a surge in market demand at the Need for optimizing logistics. but also a competitor of the existing trader end of Sawan month (July). By the time, The cost for transporting live Kuroilers was INR 9 per unit whereas the industry average is INR 4 per unit. This high cost of transportation resulted from underutilization of capacity during transportation, which has squeezed the profit margin of the FPC. Weight and size issues. Customers prefer birds of weight around 1–1.5 kg, but FPC was providing underweight (600 gm) birds, which is creating scope for customer dissatisfaction and loss of revenue for farmers. Unexpected decrease in production because transplanting season for tomatoes was delayed by one-and-half months due to excessive rain for prolonged periods of time. The yield of tomato crops was affected, and many plants grew in size but did not bear fruit. This decrease in production led to forgoing of commitments made with buyers. Lack of regulated markets in the state. Jharkhand does not have an Agricultural Produce Market Committee (APMC) Act and the markets do not have the required infrastructure (roads, shops, parking facilities, drainage, waste disposal, storage facilities, price and quantity monitoring) to operate efficiently. Most marketplaces are haats that operate on a specific day of the week. Jharkhand is popular for off-season production of many essential vegetables which are sourced by traders from the neighboring states. These outstation buyers need better support and infrastructure while transacting with these markets. Increase in retail sales. Decreased yields led many farmers to sell their produce Image Credit : JSLPS themselves in retail markets as prices were 10 quite attractive. FPC could not motivate many were misshapen due to prolonged rewarding markets and buyers due to wrong farmers to sell through it as it was offering rains. Due to poor quality, the quantity sold estimations. wholesale prices. As FPC is planning to and sales price realization in wholesale increase the production volume for farmers, markets were affected. Lack of market information and it will face hurdles in future in aggregation intelligence system. Data collection of produce due to misunderstanding of the Aggregating demand, standardizing related to market information are on need pricing mechanism in retail and wholesale supply and estimating production volume basis and reactive in nature. The decisions markets by farmers. for such a large number of farmers spread related to buyer engagement are taken over 17 districts was difficult without in haste. Many times, farmers miss good Quality issues. Tomatoes had dark use of technology. Many times, desired opportunities existing in nearby markets due spots and white lines on their surface, and volumes were not available to transact with to lack of prior knowledge. Image Credit : Rohit Jain 11 Way Forward Image Credit : Rohit Jain Expansion of rural business hub Contract farming. FPCs are planning data communication. network. Rural business hubs will help to undertake pilots on select crops, such FPCs to reach farmers in a strategic way. as potato, tomato, watermelon, which FPC member training. Continuing This physical presence will be aided with have longer shelf-life and strong market awareness and training programs to technology driven processes to carry out requirements. These trials would be in educate FPC members about customer input and output businesses. Currently, collaboration with corporate buyers who preferences and quality adherence JOHAR is using facilities provided by will dictate quality specifications and would enable farmers to respond to government to set up rural business handhold the production process by sharing market demands. JOHAR will engage hubs and in the future, FPCs will set up and implementing Package of Practices, with business-to-business e-commerce temporary rural business hubs as CCs to extending financial support, and buying companies for hands on training on setting facilitate output procurement. back the produce. Based on the on-field up CCs, quality management and periodic experience, these pilots will be scaled for training on grading and packaging. Developing market led production large scale production. clusters. FPCs are planning to start Robust supply chain. Efficiency new production clusters by increasing the Establish farmer’s wholesale is required in every step of the supply area of cultivation for existing varieties market. To address the lack of marketing chain (such as bird availability, rearing, and by introducing new varieties as per infrastructure in the state, JOHAR FPCs feed conversion ratio, vehicle occupancy, market demand. This would have the plan to establish wholesale farmer’s mortality of birds during transportation, following implications: minimum scale will markets in which bulk volume trading placement of bird retail counters be available for transacting with big buyers; activities will be undertaken. Based on the (occupancy, fill rate), and payments and increase in yield and volume will increase learning from existing markets of Karnataka credit management), and for each step the total income for farmers; and for new and Maharashtra, activities will be scaled up there is an industry standard to achieve. varieties, FPCs will have competitive for creating more marketplaces, increasing JOHAR’s large geographic presence would advantage as a supplier. capacities of existing markets, and allow the capture and reporting of data introducing technology for automation and related to the above operational processes 12 for different socio-economic conditions and would facilitate in creating area-specific operational standards. Price fixation and monitoring. For Kuroilers in Jharakhand, price fixation is not yet scientific. With a sizeable customer base, demand volume, and distribution network, JOHAR will devise a price fixation mechanism for Kuroilers for the whole state and will regulate the price dissemination systems and processes. Making marketing intelligence App reachable and usable. Regular trainings will be facilitated to use this App for extracting market information before making transactions. A feedback system will be implemented to understand the difficulties in the use of this App, and based on the responses new versions will be launched. Image Credit : Rohit Jain ABOUT THE DISCUSSION NOTE SERIES This note is part of the South Asia Agriculture and Rural Growth Discussion Note Series, that seeks to disseminate operational learnings and implementation experiences from World Bank financed rural, agriculture and food systems programs in South Asia. Author: Paresh Sethy & Bipin Bihari Series editor: Vani Kurup Publication Design & Illustrations: Parth Varshney We are grateful for the generous support from DFID. Disclaimer: The findings, interpretations, and conclusions expressed in this note are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its affiliated organizations or to members of its Board of Executive Directors or the countries they represent. South Asia Agriculture and Rural Growth Discussion Note Series Mar 2020 Public Disclosure Authorized 1 14 PIONEERING NEW APPROACHES TO RURAL AGRI-ENTREPRENEURSHIP SKILLS DEVELOPMENT IN JHARKHAND, INDIA Public Disclosure Authorized Key achievements 1,202 community service providers assessed as Trainers and Master Trainers under the National Skills Qualification Framework for the JOHAR1 project by the Agriculture Skill Council of India. Context Agriculture and allied sectors in India are amid rapid change with growing Public Disclosure Authorized urbanization leading to shifts in consumption patterns from cereals to high- value commodities2. Specific commodities underwent rapid growth, leading to an increase in agricultural exports over the past decade. However, skills training in developed countries is 60–90 percent of A vast majority of these rural producers approaches (to increase competitiveness their total workforce, in India only 5 percent are unable to transition to high-value and employment in income generating of its workforce (in the age group of 20–24 commodities6. The average landholding per commodities of agriculture and its allied years) has formal vocational skills3. farmer is 1.17 hectares. Of the 3.43 million sectors) have been mostly unsuccessful in It is imperative for India, with median age hectares of cultivable land, only 2.23 million targeting rural producers and rural youth. of population at 29 years and 64 percent hectares (65 percent) is being farmed While the percentage of skilled workforce in the working age group as of 2020, to leaving nearly 35 percent of cultivable build a skills base, ensure robust skilling for land fallow. Small livestock rearing and It is imperative for better wages at entry level, and facilitate the fish farming in catchment farm ponds, Public Disclosure Authorized need for training and certification to have tanks and reservoirs could be important India, with median age of qualified, trained human resources. potential sources of livelihood for these rural population at 29 years and 64 households. Collection and sale of non- percent in the working age Any initiatives on skill development and timber forest produce (NTFP) contributes entrepreneurship across the country have group as of 2020, to build substantially to incomes of forest dwellers been highly fragmented and constrained a skills base, ensure robust and inhabitants of hamlets surrounding by poor knowledge and limited skill-sets forest areas, who are mostly disadvantaged skilling for better wages at of on-ground community service providers and landless communities belonging to entry level, and facilitate (CSPs)4, reflecting inadequate capacity. ‘particularly vulnerable tribal groups’. the need for training Jharkhand has a large proportion of This note explains the skilling and rural and certification to have marginal and small landholders (84 agri-entrepreneurship approach, process percent), who mainly practice rain- qualified, trained human design, learnings, and the way forward of fed5,single-crop subsistence farming, the JOHAR skilling initiative. resources cultivating a low-yielding variety of paddy. 1. Jharkhand Opportunities for Harnessing Rural Growth. 2. High-value commodities include fruits and vegetables, dairy, fish, eggs, pulses, and small ruminants. 3. “Skilling in Agri-Sector for Growth & Sustainability - Mapping of Institutional Arrangements in the area of Education and Training in Agriculture” — CSIR NISTADS. 4. First-level CSP and Senior CSP are jointly referred as CSPs or cadres in this note. 5. Jharkhand is a rain dependent state and the changing weather patterns with drying up/vanishing water bodies, are accentuating problems for rural producers and tribal households (https://www.downtoearth.org.in/news/agriculture/drought-but-why-jharkhand-staring-at-food-insecurity-63484). 6. Refer to Note 10 in this series. Leveraging community institutions to support agri-business and livelihoods in Jharkhand, India. 2 Government of India’s Skilling Landscape The skillingi landscape in India has undergone massive change in the past five years with revised strategies and modelsii such as the creation of a separate Ministry of Skill Development and Entrepreneurship, revised policy on Skill Development and Entrepreneurship 2015, robust focus on convergence, formation of National Occupation Standards and Qualification Packs and declaration of new schemes like Startup Rural Entrepreneurship, Micro Units Development & Refinance Agency Ltd (MUDRA) and formation of sectoral Skill Council. In addition, schemes of Pradhan Mantri Kaushal Vikas Yojana and Deen Dayal Upadhyaya Grameen Kaushalya Yojana (DDU-GKY) for skilling India have been rolled out. The National Rural Livelihood Programme (NRLM) provides significant support to the institutional building of community institutions in rural/ tribal areas, while the Mahila Kisan Sashaktikaran Pariyojana (MKSP) as a subcomponent of NRLM focuses on capacity building of rural women concentrating on entrepreneurship development. National Skill Development Corporation (NSDC)iii was set-up as a public–private partnership to stimulate private sector participation in the Indian skill development sector. i. India is among the countries facing the greatest skill shortages. Source: Manpower Talent Shortage Survey via OECD ii. Government-funded programs that fully or partially subsidize training/apprenticeships, market-led trainings (where trainees pay for the course), market-led apprenticeships and industry-led/on-the-job training and long-term development finance.A core role of the NSDC is to provide long-term development finance to profit and non-profit organizations to build for-profit vocational training initiatives. iii. A core role of the NSDC is to provide long-term development finance to profit and non-profit organizations to build for-profit vocational training initiatives. Jharkhand State Livelihoods Promotion CSPs, has provided technical support accrediting training centers based on the Society (JSLPS)7, under the JOHAR services (to HVA, NTFP and livestock recommendation of JSLPS, and assessing project is developing and nurturing about producer households) as well as on-ground and certifying trainees/technical para- 7,000 CSPs with expertise in high-value capacity and institution building support to professionals for promoting HVA, livestock, agriculture (HVA), fisheries, NTFP, livestock, community institutions. fisheries, NTFP and irrigation. irrigation and agri-entrepreneurship. JSLPS has collaborated with the Agriculture These CSPs are providing skilled technical Skill Council of India (ASCI) for training, Jharkhand State services to tribal and rural women, producer Livelihoods Promotion assessment and certification of trainers (Sr. groups (PGs), and agro-producers across CSP), certification of training centers and Society, under the JOHAR the JOHAR project areas. CSPs are assessment and certification of trainees project is developing and self-employed and earn user fees on the (first-level CSPs) under the relevant provision of services, and also incrementally nurturing about 7,000 CSPs Qualification Packs (QPs) and National increase their income as they gain with expertise in HVA, Occupational Standards (NOS) (for experience and broaden their knowledge additional information concerning skilling fisheries, NTFP, livestock, base through continuous interactions with landscape in India, refer to the box above). irrigation and agri- the community and other stakeholders. Under this agreement, ASCI is responsible Over the past few years NRLP, through entrepreneurship for the training of trainers, assessing and Interventions Structured two-tier system of execute the various field activities of the Domain wise designation of CSP. CSPs. For training and capacity building PGs. According to the QPs, CSPs had certain of farmers of PGs, a two-tier system was The Sr. CSP was a ASCI certified trainer designations/technical titles, that were used developed at the village level. Each PG and responsible for imparting training and to define their actual skills and roles while (approximately 40 to 50 farmers) received developing skill-sets of first-level CSPs in searching for additional jobs. This process guidance and support from a first-level CSP. respective areas. Afterwards, first-level of standardization of job roles in rural areas Ten such first-level CSPs were guided and CSPs trained farmers of their PGs and helped develop confidence among those supervised by a Senior (Sr.) CSP in the developed their capacities. who received such trainings. The table on field. These CSPs collectively worked to page 3 elaborates this point. 7. JSLPS, through the implementation of development and economic transformation projects (such as JOHAR, NRLM and NRLP), recognizes the need to skill rural producers, introduce them to new technologies and best practices. These will enable them to adopt new techniques, multiply the production of HVA, such as horticulture and other cash crops, and generate revenues. It is also facilitating opportunities in livestock and NTFP to make them more remunerative. It is, thus, essential to develop new mechanisms and strengthen existing ones to provide regular training and on-field handholding support to producers in agriculture and allied sectors.. 3 Domain Sr. CSP CSP Technical name as per QPs HVA Sr. Ajeevika Krishak Mitras (Sr. AKM) Ajeevika Krishak Mitras (AKM) Agriculture Extension Service Provider (AESP) Livestock Sr. Ajeevika Pashu Sakhi (Sr. APS) Ajeevika Pashu Sakhi (APS) Animal Health Worker (AHW) Irrigation Para irrigation Engineer (PIE) Technical Service Provider (TSP) Irrigation Service Technician (IST) Fisheries Sr. Ajeevika Matasay Mitras (Sr. AMM) Ajeevika Matasay Mitras (AMM) Fisheries Extension Associate (FEA) NTFP Sr. Ajeevika Van Mitras (Sr. AVM) Ajeevika Van Mitras (AVM) Non-timber Forest Produce Collector (NTFPC) JOHAR Skills Process Flow The flowchart explains the process of training and skilling of the CSPs under JOHAR, achieved in collaboration with ASCI. 4 Key Learnings The JOHAR project has taken concrete steps towards developing a skilled cadre base in agro-allied sectors through its community-centric approach of capacity building of CSPs and offering work opportunities with compensation to gain valuable experience and earn livelihood in the process. Besides, these cadres are helping the project by building the capacity of PGs and exposing them with new learnings, which has a direct application on the production, increase in productivity, marketing, and sustainability of the project. Successes Image Credit : Rohit Jain Creating a pool of trainers. The model of training CSPs, their assessment, increasing productivity in the agro-allied who belong to PGs and are from the rural certification, and enrolment on the sector is critical but challenging. Training community do not possess the requisite Takshshila8 platform served multiple provisions, capacity building and ecosystem degree which impedes in building a trained purposes: (i) It built a skills base oriented in terms of QPs and training contents workforce. towards training and certification of qualified relevant to rural occupations and livelihoods human resources. (ii) CSPs received work are weak, requiring new research and Conducting round-the-year opportunities and gained work experience, appropriate training modules. Further, refresher training is crucial for the that was remunerative as well, which mapping of additional job roles and existing CSPs for their up-skilling, new learnings, ensured their motivation to work, self- modules or package of practices need to be and contribution towards the effective belief and proactive engagement with included in the National Skills Qualifications implementation of the project. Convergence communities and local officials. Further, as Framework (NSQF)9. with State Skill Development Missions CSPs travelled for work, they get exposed and NSDC should be explored in which to newer environments, came across new Sourcing of candidates to train a structured training mechanism can be work opportunities and accepted new as a community service provider. designed to strengthen the sustainability training assignments. Overall, a pool of JOHAR project requires a pool of trainers and qualifications of the CSPs. cadres will contribute to the project areas and master trainers for the dissemination of beyond the life-cycle of the project. knowledge among the rural communities. Planning beyond project life- But, a significant challenge is the cycle. Currently, as part of the project Acceptance of QP based skill identification of the right person from the design, CSPs are paid by the project itself. training in the agro-allied sector. community who possess the right ability and This ensures an average income of INR Awareness and training programs helped attitude to execute the knowledge transfer 5,000–6,000 per month. The impetus for PG members understand the importance effectively with the perspective of career CSPs to work hard and find additional work of skill training and certification. It will growth. on their own is less as the project provides prompt many educated and semi-educated a specific complacency, which limits the farmers or farm workers to undergo such Addressing eligibility criteria of scope for engaging in entrepreneurial training and certification. They can become CSPs to be Trainers and Master endeavors. self-employed and diversify their livelihood Trainers. There is a considerable opportunities. eligibility gap in the selection of suitable Enhancing focus on CSPs across the agro-allied sectors as entrepreneurship. A need-analysis in Challenges per existing NSDC requirements. As per coordination with the domain leads needs Research and appropriate NSQF, job roles of the service providers to be carried out to explore the agro- training modules development. defined in the table in the interventions entrepreneurship avenues in the program 59 percent of the country’s total workforce section requires the minimum qualifications and the project areas and engage with the is employed in agriculture in India. Building like Diploma, Graduation and Masters in trained cadres to take up entrepreneurial skills, creating job opportunities, and respective domains such as agriculture, activities. fisheries, mechanical forestry. The cadres 8. Takshashila is an initiative by NSDC under the Skill India mission. The portal serves as a dedicated online platform for the management of trainers and assessors of the Indian short-term skill ecosystem, functioning as the central repository of information concerning development of quality trainers and assessors. 9. NSQF is a competency-based framework that organizes all qualifications according to a series of levels of knowledge, skills and aptitude. 5 A journey of a Master Trainer Aarti Devi is 35 years old and lives in Banaidag village of Angara block in Ranchi district. She joined Sakhi Mandal in 2012. She was selected as Aajeevika Pashu Sakhi (APS) and was given training by JSLPS in 2013. After the completion of the training cycle, she started providing her services in her village and received some honorarium. Because the honorarium and her husband’s income were inadequate for the family, she began seeking opportunities to enhance her income. Fortunately, the introduction of the JOHAR project in 2017 provided her with a tremendous opportunity. Recognizing her commitment and efforts as an APS, she was selected as Senior APS (Master Trainer) in Image Credit : Rohit Jain the JOHAR project. She received a comprehensive 200 hours of training portal – Takshashila, she became a Narrating her transformation, she administered by the JOHAR Livestock duly certified Master Trainer. With her says, “I always wanted to financially team and Asset & W with the support certified skill-sets, she is now capable support my family and have my of the skills team. of providing training and services in own identity, as well. Therefore, Jharkhand and beyond, which is a immediately after joining the Sakhi The training consisted of four great achievement for her. Mandal, I became an APS. However, modules: (i) aadharshila (foundation), the meager honorarium, along with (ii) bakari palan (goat rearing), (iii) Since July 2018, she is working my husband’s income, was hardly suar palan (pig rearing) and (iv) as a Master Trainer and provides enough to sustain my family. But murgi palan (poultry farming). These module training as well as TOT to getting selected for the Master training modules are aligned with the Pashu sakhis in various districts Trainer was like a dream come true. national QPs approved by the NSDC. of Jharkhand. For each training, she Now, I am being hired to provide After completion of the technical receives a daily honorarium of INR APS training in different districts, and training (200 hours), Aarti received an 750 and conveyance charges. As a my earning has increased manifold. additional 10 days of TOT (Training of Master Trainer, she is engaged for Further, I can send my children to a Trainers) through ASCI. eight to ten days of training every good private school in Ranchi, and month. Additionally, she provides her my family now enjoys a decent quality After the completion of the all services as an APS in the village. of life. Most importantly, not only trainings, she appeared in the Together with her Master Trainer my villagers but people of different examination conducted by ASCI services and APS honorarium, Aarti districts recognize me and look at wherein she scored 80 percent marks earns around INR 8,000–10,000 me with respect. My confidence has leading to her selection as Master monthly, which is a significant improved a lot, and I’m proud of my Trainer. Further, with her name improvement over her earlier earning achievements”. registered on the NSDC national of just INR 15,000-20,000 annually. 6 Way Forward cover a large dedicated zone on multiple that many more become eligible and job requirements; to take on a cluster receive instruction, increasing the pool of approach in terms of coverage of cadres trained workforce in rural areas. as well as households; and provide •• Increase access to higher education for trainings in various job roles round the rural youth. year. •• ensure that the project does not stress Access to new technology on skilling in various job roles that are platforms and convergence with not yet approved under NSQF. Krishi Vigyan Kendras. •• ensure training of CSPs in multi-modules •• Multiple new technology platforms/ to cater to various geographical areas jobs sites (such as Baba Jobs, and domains. Youth4work) are available where CSPs can enrol themselves to seek further Explore avenues for including work opportunities. Such avenues people with limited education but need exploration within the purview extensive farming experiences of the project. However, there may be by re-examining qualification constraints if these job sites are not criteria. addressing agriculture and allied sectors. Ensure appropriate training •• In rural areas, most of the people •• Converge with Krishi Vigyan Kendras infrastructure. This would include the do not study till college and a good (KVKs)10 and other such agencies that need to: majority study till 10+2 only or below impart training to farmers, rural youth •• perform new research and needs matriculation. Higher educational and grass roots level extension workers assessment for developing training qualification is a major preventive in broad-based agricultural production contents relevant to rural occupations factor and excludes people with limited systems. JOHAR can converge with and sustainable livelihoods. education. Therefore, if the NSDC KVKs for skilling and refresher training •• create a pool of CSPs with opportunities or NSQF re-examines educational courses, as well as engage in strategic beyond the life-cycle of the project. qualification requirements and lowers the deliberations with job sites to create •• ensure training of competent experts/ bar for eligibility, then more people can work avenues to its trained CSP cadres service providers: to comprehensively gain access. This process will ensure beyond Takshshila. 10. KVKs are agricultural extension centers for imparting vocational training to practicing farmers, school dropouts and field level extension functionaries in the rural areas. ABOUT THE DISCUSSION NOTE SERIES This note is part of the South Asia Agriculture and Rural Growth Discussion Note Series, that seeks to disseminate operational learnings and implementation experiences from World Bank financed rural, agriculture and food systems programs in South Asia. Author: Vineet Kumar, Tapas Ranjan Behera & Bipin Bihari Series editor: Vani Kurup Publication Design & Illustrations: Parth Varshney We are grateful for the generous support from DFID. Disclaimer: The findings, interpretations, and conclusions expressed in this note are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its affiliated organizations or to members of its Board of Executive Directors or the countries they represent. South Asia Agriculture and Rural Growth Discussion Note Series Mar 2020 Public Disclosure Authorized 1 15 MARKET PROVISIONING OF TECHNOLOGY-ENABLED AGRICULTURAL SERVICES IN INDIA Public Disclosure Authorized Context Farmers in India, especially smallholders, face a number of challenges that make their income streams low and unreliable. These include: (i) low productivity due to degradation of soil quality, insufficient water, poor quality of inputs, poor production practices, pest and disease attacks and insufficient access to tools and implements; Public Disclosure Authorized (ii) shortage of formal credit to purchase inputs in part because of transaction costs and perceptions of repayment risks of formal lenders; (iii) climate variability leading enhancing services that address the above jumped up from US$73 million in 2018 to low productivity and wastage of inputs challenges. to US$248 million in 2019 (as of July). A and produce (such as unexpected rains NASSCOM report states that about half of In this context in recent years, a slew washing away fertilizers or ruining crops); the agritech CEOs interviewed expect that of start-up companies have entered the (iv) market risks including price volatility and one of the firms in this space will reach a agriculture sector with a fee-based revenue not availing the best market price available; valuation of US$1 billion within the next model alongside leading technology firms (v) lack of storage facilities or processing to three years2. like Microsoft, IBM and Google. Armed with realize higher incomes; and (vi) inefficient technology, data analytics capabilities and This note explains the services offered by business processes of farmer producer risk capital, these agritech firms1 provide these firms and provides a perspective organizations (FPOs) leading to difficulties a range of services to farmers from input on these services based on experiences Public Disclosure Authorized in offering collectivized services to their sales and conventional cropping advisories, in World Bank projects and stakeholder members. All of the above combine to make to hiring out farm implements and sales. interviews. smallholder farming a risky business that For farmer collectives and for institutional generates losses all too often. buyers, farm Enterprise Resource Planning Armed with technology, Small farm sizes, low incomes and (ERP) software are being used for data analytics capabilities declining last-mile extension services by the automation across the value chain and for government prevent farmers from investing traceability. Finally, some forecast weather, and risk capital, agritech in productivity enhancing technologies pest and disease attacks and yield and firms provide a range of thereby increasing the chance that they stay loss estimates, automate optimal irrigation services to farmers from in a poverty trap. Low willingness and ability and provide intelligence on borrowers’ input sales and conventional to pay has deterred private provisioning of creditworthiness and claims payouts to services. However of late, entrepreneurs banks and insurers. There are around 450 cropping advisories, to hiring and investors seem to be convinced that agritech firms in India today; of these 35 out farm implements and there are enough efficiency gains to be were started in 2018 alone. Venture capital sales had for them to profitably provide income is rapidly increasing and total investments 1. There appears to be no clear definition or categorization of agritech services. The National Association of Software and Service Companies (NASSCOM) report includes Samunnati’s lending to farmer collectives and DeHaat’s selling of input and outputs under agritech though neither uses any specialized technology that is core to their business. Agritech can be broadly denoted as private provisioning of goods and services to stakeholders in the farming ecosystem, using better organization and software to formalize or modernize the sector or using analytics and prediction technologies. 2. NASSCOM Report, “Agritech In India: Emerging Trends in 2019”, July 2019 2 Interventions Market-provisioned technology- service and illustrative providers. Most based on the level of technological enabled agricultural support of the expansion appears to be in the complexity of the solution offered: services. The table below summarizes marketing space based on the number of (i) conventional services, (ii) newer services the technology-enabled agricultural support players and marquee investments made. using mature technologies, and (iii) services offered based on the type of Services are classified into three categories advanced analytics based services. Type Specific services Selected providers3 Sale of quality inputs Advisory on inputs, crop selection, package of practices, pest and Agrostar disease remedial action Weather Risk Management Services Inputs and cropping Weather forecast to schedule farmer Satsure advisory and operations better forecasting services IBM Pest and disease attack forecast and protection advisory Vassar Labs Predicting sowing and harvesting Farmguide windows Forecasting crop health and yield DeHaat Marketing and sales Identify and negotiate with buyers Ninjacart Cropin Enterprise resource End-to-end cropping planning to sales planning (ERP) automation software for FPOs, and FarmERP software for FPOs farm contractors SourceTrace Inform lenders of creditworthiness of a Impact Micro Ventures farmer; estimate crop health and yield Aye Finance Credit and insurance and hence repayment risks to lender Credit Vidya Remote sensing of cropping area and losses for insurers to make payouts Think Analytics Detect soil moisture and recommend/ Avanijal Precision irrigation automate ideal amount of water to be released Conserwater Oxen Goldfarm Rent farm tools from Custom Hiring Farm implements Trringo Centers Kethinext Agribolo 3. Most of these providers offer services in multiple categories. Disclaimer: the Bank does not endorse any of these companies. 3 irrigation. Internet of Things4 (IoT) controllers help release the right amount of water from the irrigation source to maintain ideal soil moisture for a given crop. •• Farm ERP software: This is end-to- end software which can help an FPO or the principal in contract farming arrangements to manage the entire value chain from crop planning, inputs supplies, credit needs, sowing and harvest dates, logistics, sales, invoicing and payment through to accounting. It has the potential to help an FPO or buyer to monitor and manage a large number of member farmers where manual processes would be too difficult. It can also provide traceability of food through the value chain. Advanced analytics based services. Image Credit : Rohit Jain •• Predicting sowing window: Recommending the ideal sowing window Conventional services using farmers. The provider uses software for that would maximize yield based on software and Information and demand aggregation and logistics. historical sowing and yield data as well Communication Technology (ICT) as weather forecasts. •• Farm tools rentals: These often channels. use Uber-like apps for hiring farm •• Estimating farmers’ sown area, •• Inputs and cropping advisory: implements. current crop health and yield at the These include SMS and voice-based end of the season: Using historical Newer services using mature advisory on crop selection and data and satellite imagery, providers technologies. production practices along with sale of make available intelligence to: (i) inform the recommended inputs and package •• Weather forecast-based advisories: lenders about the creditworthiness of practices reminders that are sent Providers forecast rainfall and of a farmer; (ii) recommend the ideal through SMS on the phone. temperature 24 hours to 15 days in repayment schedule for the lender’s advance, downscaled to block or loan collection officers; (iii) alert an •• Pest and disease protection advisory: sub-block levels and advise farmers to institutional buyer in case the contracted Farmers or community extension schedule farm operations better (such quantity of yield may not materialize; and workers are provided with a mobile app as harvest a few days earlier before a (iv) estimate yield to inform crop insurers to take a photo of the affected plant and thunderstorm destroys the crops). This the extent of losses and hence the claim send it to a back-end agri-specialist who has been enabled by use of satellite payout amount. diagnoses and recommends remedial data, installation of automated weather action by phone call or through the app. •• Automated diagnosis and prediction stations and improved forecasting algorithms. of pest and diseases: The provider •• Marketing and sales: The provider receives the photo which is fed into a negotiates with buyers based on the •• Precision irrigation automation: classification model that diagnoses and harvest date and amount, and offers Plants need a certain amount of soil prepares an advisory. Additionally, based a price to the farmer in exchange for moisture at different cropping stages. on the location, weather conditions, soil a commission. They further organize Providers use satellite data or field- and water conditions, the forecasting collection centers for sales after harvest. installed sensors to determine current engine can predict an imminent attack They also recommend good inputs soil moisture and use weather forecasts and warn the farmers through SMS. and procure and distribute the same to to determine the ideal amount of 4. IoT is a network of “smart devices” that can sense and interact with their environment by means of the Internet for their communication and interaction with users and other systems. In this context an irrigation IoT system will enable automated operation of pumpsets. 4 Potential clients. The table below lists the types of clients and how they benefit from Agritech services. Public, private, Borrower risk assessment and repayment collection intelligence to banks small banks, NBFCs Public and private insurers Yield loss estimates to insurers largely of PMFBY to settle claims Departments of agriculture, horticulture, rural development and farmers who Government received individual advisory Farmer pays for inputs supplies and crop advisory is delivered through phones as Direct to farmers and FPOs SMS or through an app Key Learnings (Assessment of the sector) The sector is in a rapid growth data, and skills in machine learning5 and Both mature and cutting-edge phase. Agritech providers are profit- artificial intelligence6 as well as capital and technologies are being used. For seeking firms operating on commercial interest of sophisticated human resources example, a large part of venture capital principles and are funded by venture that apply modern business practices, has investments is given to marketing and sales capitalists. While some earn user fees from enabled providers to develop forecasting service providers. They simply organize farmers, others get paid by the government, models and deliver advisories to farmers (without using modern technology) this buyers, insurers and lenders. Investors electronically at a lower cost compared part of the value chain (which was formerly are interested because: (i) the agriculture to field extension services and with less largely in the informal sector) into the formal market size is large, (ii) portfolio companies reliance on scarce agriculture experts. sector professionally using sophisticated make regular earnings and the burn rate is staff. moderate, (iii) there are large institutional Sizeable early outreach. customers like lenders and insurers, and Aggregated sectoral outreach figures are Potential farmer impact. A (iv) low mortality rates of 10%–20% of these not readily available. However, as the randomized controlled trial of mobile based start-ups. table below shows, the outreach of these advisories delivered by Avaaj Otalo7 found services are considerable, well above pilot that the demand for advice was high and Multiple enabling factors. A figures, and include high-profile projects and the intervention was impactful. It increased combination of high penetration of mobile stakeholders. the farmers’ yield of cumin (28%) and cotton phones and data, free or cheap satellite (8.6%, for a sub-group that received the 5. A class of techniques that enable a computer to do well, things which are difficult for humans, such as playing the game Go. 6. A class of techniques that enable a computer to do well, things that come easy to humans, but have previously been a struggle for computers such as identifying a cat in a picture. 7. This is a mobile phone-based technology that allows farmers in India to call a hotline, ask questions and receive responses from agricultural scientists and local extension workers. 5 reminders). An assessment of Manna’s Benefits to lenders and insurers. public lenders to profitably cover more poor precision irrigation interventions in demo Better assessment of credit risk and loan farmers. Correct and lower loss estimates plots found large (>50%) increases in yields monitoring helps banks target borrowers can enable insurers to make correct and of fruits and vegetables8. better and optimize repayment collections. timely claims payouts to insured farmers. This has the potential to enable private and Provider Outreach •• Lending intelligence to ICICI Bank’s 100,000 customers •• Loan monitoring of ICICI Bank’s INR 18,000 crore portfolio •• Loss estimates for settling 73,000 Pradhan Mantri Fasal Bima Yojana (PMFBY) Satsure crop insurance claims by various insurers •• Leading public and private crop insurers are using satellite data from analytics firms to estimate yield loss as per PMFBY guidelines •• Providing yield-increasing advisory through Multipurpose Extension Officers of Vassar Labs the Department of Agriculture, Andhra Pradesh in a command area of 18,000 villages with 5 million farmers having varied land sizes •• Piloting farmer advisories through Krishi Vigyan Kendras (KVKs), including soil IBM moisture, crop health and yield estimation, market price forecasts in 5 districts through Karnataka state’s agriculture department •• Several lakh farmers directly pay for agro advisory services, package of practices, Agrostar and inputs through a call center delivery mechanism •• Weather, pest and cropping advisories to 8,000 self-help group member farmers Cropin in Bihar and Madhya Pradesh, and to 30,000 farmers in Jharkhand •• Sells income guarantee product to farmers directly conditional on farmers Weather Risk adoption of recommended package of practices Way Forward Technology-enabled agricultural services are very welcome development, with the private sector offering a valuable service to large numbers of neglected poor customers. However support is required for this sector to survive, grow and deliver income- enhancing services to farmers. Support from government and funders: Not all providers have comprehensive domain knowledge or viable models to work with poorer farmers who are of particular interest to the development sector. Hence more engagements with government subsidized projects to service low income farmers, already aggregated Image Credit : Rohit Jain 8. World Bank internal presentation. 6 into collectives will enable providers to conditions and incidences of attacks from More clarifying reports that demystify these gain experience of servicing smallholders that pest to prepare a forecasting model. services and illustrate the specific use cases profitably at a lower unit cost due to However, lack of access to such data is through which agritech services will benefit economies of scale and lower cost of preventing providers from preparing more the ecosystem will speed up understanding client acquisition. As the initial willingness accurate models for more crops. Such data of this sector by potential clients. Carefully of farmers to pay is likely to be lower than are available with agricultural universities done evaluation studies will help make the the benefits, these government subsidized and government departments and should be benefits and use of cases clearer. projects will help farmers test out and made available publicly. experience the value of these services to Data privacy: Government laws place decide if they want to pay out-of-pocket Hype cycle: There is an over-promising restrictions on some providers from storing after the project period. of the accuracy levels of forecast-based farmer level data on their servers, which services and a shortage of accuracy makes data integration and hence delivery Data availability to speed up disclosure. Studies are needed to measure of services more difficult. In these cases it forecast services: Availability and the accuracy of services, and develop would be helpful to relax the restrictions and access to data is a major constraint. For common terminology and performance place other privacy protection policies so a provider to predict, for example, when benchmarks for customers to gauge the that farmers can be benefitted. a pest will attack, it needs “training” data quality. There is hardly any documentation on past cropping practices, prevailing on the effectiveness of these services. ABOUT THE DISCUSSION NOTE SERIES This note is part of the South Asia Agriculture and Rural Growth Discussion Note Series, that seeks to disseminate operational learnings and implementation experiences from World Bank financed rural, agriculture and food systems programs in South Asia. Author: Karuna Krishnaswamy Series editor: Vani Kurup Publication Design & Illustrations: Parth Varshney We are grateful for the generous support from DFID. Disclaimer: The findings, interpretations, and conclusions expressed in this note are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its affiliated organizations or to members of its Board of Executive Directors or the countries they represent. South Asia Agriculture and Rural Growth Discussion Note Series Mar 2020 Public Disclosure Authorized 1 16 BUILDING RURAL POULTRY SUPPLY- CHAINS TO ENHANCE INCOMES THROUGH COMMUNITY-DRIVEN INTERVENTIONS Public Disclosure Authorized CASE STUDY FROM JHARKHAND, INDIA Key achievements Investment in layer farming has a strong potential to add nearly 50 percent to the overall rural household income of layer co-operative members. Successful market linkages for collective procurement of inputs and sale of produce leveraged benefits of scale and improved market efficiencies for member producer households. Public Disclosure Authorized Context The Basia layer co-operative Layer farming is an income-generating production, coupled with poor market model livelihood activity wherein egg-laying linkages and inefficiencies make it a Operates on a collectivization model Public Disclosure Authorized poultry birds are raised by a household challenge for households to realize linked to a network of producer groups for the purpose of egg production on a remunerative prices from their produce. commercial scale. The few traditional rural Leverages community-based As a part of its diversified and resilient producer households that are engaged in institutional capacities as well as production systems component, the layer farming in Jharkhand are constrained financial support from the Jharkhand JOHAR2 project has invested in layer by high input costs (such as pullets, feed, State Livelihood Promotion Society farming under the livestock development vaccinations), a high disease-based and the Jharkhand Women Self- sub-component, with the objective of mortality rate, and poor access to credit, Supporting Poultry Cooperative improving rural livelihoods in Jharkhand. making it a less remunerative income Federation Limited This note investigates a layer co-operative’s source. Cereal-based feed is imported Includes 300 member households federation, operational and production from Andhra Pradesh, Bihar and Madhya across 12 producer groups of 12 model as well as financial feasibility. Pradesh, thereby escalating input costs1. villages Jharkhand is dependent on egg imports An operational co-operative in Basia block, from neighboring states, thus presenting of Gumla district, was used as a case and Collects and markets on average a promising marketing opportunity within analysed in detail. 8,658 eggs produced by each the state. However, low and fragmented household per month 1. Based on field studies conducted under the Jharkhand Opportunities for Harnessing Rural Growth (JOHAR) project 2. Jharkhand Opportunities for Harnessing Rural Growth. For more details on the project see: World Bank. 2017. India - Jharkhand Opportunities for Harnessing Rural Growth (JOHAR) Project (English). Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/303211498576866109/India- Jharkhand-Opportunities-for-Harnessing-Rural-Growth-JOHAR-Project 2 Interventions Layer co-operative federated operative and earn revenue from the supply PG member households bore the costs of model of inputs (pullets, feed, medicines, and labor and undertook shed construction for vaccines) to the co-operative. Meanwhile, the layer. Second, the members undertook Under the JOHAR project, an initial grant of the role of the co-operative involved utilizing INR 1,20,000 per household was provided this working capital to provide pullets, feed, to producer groups (PGs) towards shed medicine, vaccines and technical support construction and INR 77,200 per member to the PG member households. First, by of the co-operative to meet working capital using the capital for shed construction, the requirements with support from a federation. JOHAR Project In this model, the federation employed staff and deputed them to work at the co- Funds for shed construction and working capital Federation Working Capital JOHAR Salaried professional staff • PG Medicine and vaccines • • Pullets Technical know-how • • Feed, medicine and vaccines Pullets • • Technical support Feed • Funds for shed construction Member Market/ Producer Co-operative Traders Eggs Households Eggs • Per egg grower fee as per efficiency rate • Dividend from profits Cost–benefit analysis A cost–benefit analysis was undertaken to examine the costs, revenues and investments of the operation and production model at the co-operative and co-operative member household levels. It included: Household survey make of: •• Four randomly sampled villages (Longa Keonjhitoli, Lungtu Khas, Solangbira Bartoli and Sonmer Bahiratoli) selected from 15 villages within the catchment area of the co-operative. •• Four randomly selected households from each of these four villages providing 16 households for the analysis from a total of 178 households where the production of eggs had already begun, at the time of data collection for this analysis. Supervisor level survey of three randomly selected supervisors from the four villages. Cooperative staff survey of seven members. Follow-up meeting with the chief executive officer of Jharkhand Women Self-Supporting Poultry Cooperative Federation Limited (JWSPCFL)3, Ranchi to validate findings and fill in information gaps. The analysis indicated that the co-operative is functioning profitably. The profit is expected to be divided among members which would amount to INR 64,069 per household. 3. JWSPCFL is a female farmer-owned enterprise that leverages a community-based model to build institutional capacity for the growth of small-holder poultry and layer farming in Jharkhand. 3 layer farming to meet their working capital requirements with support from the co- operative. The layer eggs thus produced were supplied to the co-operative which was responsible for the collective sale of eggs. The collection of eggs from all member households engaged in layer farming enabled the co-operative to leverage economies of scale. Proceeds were paid to the households based on per egg grower fee as per the efficiency rate. In addition, the co-operative paid a dividend to the Image Credit : JSLPS member households. Layer co-operative operation and production model At Producer Member Household Level Costs were primarily incurred for labor for shed construction. Fixed costs for the cooperative member household Average one-off fixed costs per household INR Cost of shed construction 1,60,000 Grant from PG for shed construction 1,20,000 Loan for shed construction from co-operative 40,000 Share capital 1,000 Membership fee 15 Labor cost 11,281 Total social investment 1,72,296 A part of the shed construction (INR 40,000) was borne by the households in the form of a loan extended by the co-operative at a 12 percent annual rate of interest. The value of labor for shed construction was incurred by the household as a one-time cost and amounted to INR 11,281. Besides, each household paid a share capital of INR 1,000 and a membership fee of INR 15 to the co-operative. Working capital costs were met through JOHAR, and thus households did not incur any substantive recurrent working costs, and had time to take care of the birds. Revenue earning per egg on average was INR 0.30. Households sold 8,658 eggs in September 2019 with an average efficiency rate of 83 percent. Contributions towards loan repayment started once a member household’s minimum earnings from layer farming crossed the threshold of INR 1,000. The amount ranged from INR 100 to INR 800, based on the income earned by the household from egg production. Profitability. On average a household had a net income of INR 2,278 per month. The average annual household income from all sources (including agriculture, livestock, fisheries, non-timber forest produce, wages and enterprise, and others) as per the JOHAR baseline report (2018) was INR 56,430, indicating that investment in layer farming has a strong potential to add nearly 50 percent to the overall rural household income. From a social perspective, the initial investment of INR 1,72,296 generated an annual net income of INR 35,076 (20.3 percent return on investment) which is also promising. 4 At Co-operative Level Costs included expenses such as payment of staff salaries, staff travel, storeroom rent, stationery and printing costs, electricity costs, office maintenance, feed, seeds, medicines and vaccinations costs. Total operating costs and sales revenue under the layer co-operative model Item Per unit value (INR) Gross value (INR) REVENUE (A) Sales revenue 4.17 8,49,21,600 WORKING COSTS (B) Fixed cost 0.13 26,47,436 Feed and medicines 2.80 5,70,21,698 Admin expenses 0.05 10,18,245 Egg collection cost 0.10 20,36,489 Packaging cost 0.21 42,76,627 Reserve being kept by the co-operative 0.01 2,03,649 Payment to the household (egg purchase) 0.30 61,09,468 Total working cost (B) 3.61 7,35,17,260 Profit (A)-(B) 0.56 1,14,04,340 Initial shed construction, loan to households and working capital costs were largely funded by the JOHAR project. These amounted to INR 77,200 per member and was provided to 178 member households (INR 1,37,41,600). The total working costs for a year amounted to INR 7,35,17,260, i.e. approximately INR 3.61 per egg, of which INR 3.31 went as contribution towards meeting operating costs and INR 0.30 was paid to the household. Revenue earning per annum was INR 8,49,21,600 (including interest). As the total annual working cost was INR 7,35,17,260, the operating profit would be INR 1,14,04,340. On average 56,000 eggs were produced a day with the last batch being sold for INR 4.17. Profitability for the financial year ending 31st March 2019 was INR 45,000 reflecting that production had yet not been initiated by all the households. No dividends had been paid out to member households at the time of the study. Key Learnings and Way Forward Overall, this rapid assessment indicates that market constraints of demand and scale up the layer cooperative model. This the layer co-operative model: supply because of the collectivization shows promise economically for livestock •• is profitable, both at the co-operative and design. interventions with potential of being scaled member household levels given the high •• plays a role in enhancing rural incomes up and popularized. Specifically: annual rate of return on investment. by encouraging social welfare and I. The JWSPCFL ensured capacity building •• is financially feasible as well as income equity point aspects. for the sustained functioning of the Basia sustainable. Findings from a cost–benefit analysis layer co-operative model, thus providing •• allows households to leverage framework provide an evidence base for useful lessons for scaling up this design economies of scale and overcome informing future investment decisions to in layer interventions and other social 5 interventions. II. The collectivization model has the potential to be successfully employed in layer livestock development interventions when the co-operative is federated on an existing community-based organization such as the JWSPCFL. III. The co-operative’s design can play a critical role in overcoming demand and supply-side constraints faced by rural households in terms of access to inputs and credit, high costs of inputs, as well as weak and fragmented market linkages by playing an intermediary role. IV. The collective marketing of outputs within the layer model enabled the co-operative to leverage benefits of economies of scale and command better prices for eggs. This is an important finding given the need to improve market efficiency also from an economic policy perspective. The scaling up of this model may have the potential to reduce Jharkhand’s dependence on imported eggs from other Indian states. The economies of scale accruing on account of the streamlined and large-scale layer production makes layer farming more remunerative for member households as well. V. The high annual rate of return on investment for co-operative member households indicates that investments Image Credit : JSLPS 6 made in layer co-operatives hold the potential for enhancing rural incomes. For instance, an initial investment of INR 12,296 at the household level led to an annual net income of INR 27,336, after contribution towards loan repayment. The average annual household income from all livelihood sources as per the JOHAR baseline report (2018) amounted to INR 56,430. This highlights that investments in layer farming have a strong potential to add nearly 50 percent to the overall rural household income. This is promising from a social welfare and income equity point of view as well. It is also indicative of the JOHAR project’s impact on enhancing rural Image Credit : JSLPS incomes. VI. The repayment of loan principal and In conclusion, the JOHAR layer co-operative capital requirements that had to be provided interest by co-operative member model shows promise for success towards to each member household under the households showed a considerable lag realizing the pathways of enhancing rural JOHAR project. Accordingly, decisions for requiring up to a decade for repayment. farmer incomes. That said, the success scaling up and emulating this model must Investments in such a model must, of the model depends upon a high initial take into consideration the costs associated therefore, take into consideration the financial investment in the form of shed with investment recovery. time cost of investment recovery. construction, access to credit and working ABOUT THE DISCUSSION NOTE SERIES This note is part of the South Asia Agriculture and Rural Growth Discussion Note Series, that seeks to disseminate operational learnings and implementation experiences from World Bank financed rural, agriculture and food systems programs in South Asia. Authors: Tom Newton-Lewis, Avadesh Jha, Pratyush Ranjan Singh, Phalasha Nagpal & Bipin Bihari Series editor: Vani Kurup Publication Design & Illustrations: Parth Varshney We are grateful for the generous support from DFID. Disclaimer: The findings, interpretations, and conclusions expressed in this note are entirely those of the author(s) and should not be attributed in any manner to the World Bank, to its affiliated organizations or to members of its Board of Executive Directors or the countries they represent.