Micro Investment Plan (MIP) of SHG

The international standard for the definition of the poor i.e. a household that spends more than one-third of its income on food is followed in India, 95 percent of all households would be considered poor. Every country needs an inclusive political and economic institution to break out the cycle of poverty. The delivery of financial services at an affordable cost to the vast sections of extremely poor and vulnerable groups of people is a necessity for the development of India.

Plans are useless, but planning is indispensable. — Dwight D. Eisenhower

Budgets help to determine how much money one has, where to invest it, and whether one can achieve your financial goals. A budget is a forecast of all cash sources and expenditures. MIP is a tool for financial planning that can be used for both SHG and its members. Socio-Economic Analysis of each SHG is performed as risk is involved in giving loans without any collateral. The format used in TRIPTI can be downloaded here.

Indicative Components/ Seven Steps for preparing a Micro Investment Plan (MIP) :

Step 1-SHG Details Format

Step 2-Members’ socio-economic details Format

Step 3-Income and expenditure statement of members Format

Step 4-Listing of Household Investment Plans (for economic, social, and household needs) Format

Step 5-Prioritization of Members Format

Step 6-Financing and Rotation Plan Format

Step 7-Terms of Partnership Format

MIPs are promoted under National Rural Livelihood Mission as it helps in better planning to avoid bad loans on behalf of the banks. Micro Investment Plan is prepared with the initiatives of Community Resource Person Strategy in the Project. MIP is used for SHG members where many factors like a priority, wealth ranking, Investment in the activity proposed, Loan Amount, Life of Asset, Monthly Incremental Income, Saving Capacity of Household, Installment Amount, No. of Monthly Installment and other entitlements (PDS, Insurance, Pensions, etc) are considered. MIP includes plans for investment on asset creation for income generation and household needs investments. MIP is assessed at a Household-level where assets, liabilities, risks, vulnerabilities, entitlements, and other expenses are noted down in the detail.

But such detail exercise exists only in theory. Most of the MIP forms had not been filed properly. Activity proposed, No. of installation, Payback amount, and signature of President & Secretary is the main focus of Banks. The low-income who have been excluded from the financial services of formal institutions lacks financial literacy in most cases. Financial literacy for poor villagers is really important but it doesn't mean training by government officials once in a blue moon. There is always a need for the Livelihood mission/MFI/NGO to reach and build the capacity of SHG members. People need awareness about financial products, fraud activities, or else they are misleading and fall to misdeeds of chit fund companies promising high returns; This often ends up losing the lifetime savings.

Let us see a practical example of credit linkage. An SHG demanded nearly 1 Lakh as per their MIP and each member of the SHG deliberately had put Rs 10,000 as the investment capital for the proposed activity. Rs 50000 from the GPLF (Gram Panchayat level Federation of SHG under Livelihood Mission) at a nominal interest rate of 7% was given as a loan to SHG. Group divided this money among themselves equally (Rs. 5000) per member. The amount according to their need(proposed activity) will always differ from each member but fairness is maintained through this equal division. Only internal loaning is done among members on the basis of priority. In the case of external loans/grants, this fairness in distribution is always maintained by SHG. So, Priority in lending is a nice theoretical concept. How do a rural manager can change 20 years of what the common wisdom has taught them?

Validation and Grading of SHGs

SHGs were formed under Mission Shakti in Odisha. Odisha government started a validation and grading exercise to know SHG status in December 2012. The validation process aimed at confirming the existing status of SHGs, whereas the Gradation Process assessed their eligibility for receiving Revolving Funds.

Validation

In an ideal world, the Branch Manager/ Representative of the Bank, B.D.O/Representative from the block, and C.D.P.O/Representative from ICDS should visit the field and complete the process. This may take from 5-10 days depending on the size of the district. This doesn't happen in the real world where AWW sits with the President/Secretary of SHG for the complete assessment.

DRDA and ICDS Balangir have a record of 11097 SHG existing in the district but validation led to only 7846 functioning groups. Hence, we can easily imagine with these figures, the difference between SHGs claimed and existing can run in lakhs. Defunct and far SHGs form a major part of the numbers claimed by the government.

Grading

Grade I and II with A, B, and C as three categories of the SHG was the grading format. The format with various criteria is uploaded on Scribd. SHGs having 70% BPL members and passed the Grade-I test and categorized as “A” or “B” i.e. Scoring more than 60% marks during Grading will only be eligible for Revolving Fund in order of merit as per their scores. The Graded SHGs are assisted under NRLM, as this fund will aim to address the immediate production and consumption needs of members of the SHGs as well as encourage internal lending practices among the members.

In the intensive Block under NRLM, Revolving Fund(RF) of 10,000 or 15,000 depending on whether they had already received any prior assistance under any other government scheme. The SHGs who have qualified grade I test but have not availed of any financial assistance will be provided with a revolving fund of ₹.15,000/- in two tranches. In the first tranche ₹.5000/- will be provided and on successful utilization of this amount ₹.10,000/- will be provided to the group directly in 2nd tranche at least after 3 months of receiving 1st tranche. This fund will become a part of their group corpus. The group members can borrow from the group corpus to meet their various needs as decided in the group. However, the groups who have already availed of such financial assistance under Mission Shakti or any Govt. program will not be eligible for 1st tranche and receive only 10,000. I insisted on attaching Xerox copies of my BPL card and Bank Passbook SHG while working at Bhanjanagar block in Ganjam district. Hence, it created transparency and gave validity to the no. of BPL members by any SHG.

Conclusion

RF/PPIF is distributed in a campaigning mela organized at each block to sensitize the groups about NRLM. Generally, it is more show of the good work done by the government. In an ideal world, SHG assessment (or rating) should not just be limited to current performance but could also assess credit absorption and repayment capacity. That requires qualitative information to look for problems faced by each group. It is assumed by the government that the SHGs that are found ineligible would be provided hand-holding support, to improve their credibility for future assistance. However, there was no staff at the field level to do this tedious job. Record keeping at the group level has emerged as a very weak aspect of SHG functioning.

The main problem is that we don't have data on the Life cycle of a SHG. We are unable to understand how many groups are defunct or discontinued so we don’t know the mortality rate of the group. So, the government has no answer to these two questions: What groups work, and what works with groups?

Disaster Management

Disaster Management in Phailin was remarkable in its aspect of losing minimum lives when faced with challenge of massive proportion. India evacuated more than half a million people as massive Cyclone Phailin hit eastern ghats at Odisha and Andhra Pradesh. An early warning and timely actions saved countless lives. Earlier entire nation prays for the well-being of the people of disaster struck zone. Yet never care to plan. Things started changing with 1999 Odisha cyclone. And even world bank blog has put an article on the preparation by Odisha government.

In the case of flood/tsunami/cyclone, torrential rains always play havoc and diseases are rampant due to decaying carcass. The relief center must be equipped with grains, deworming pills, Trampoline sheet, dhoti/lungi with saree, mosquito net, blanket, towel & utensil kitchen as an immediate requirements for the household affected with cyclone. My prior experience on preparation for disaster management was itself a big lesson.

I was posted in Ganjam district with Panchyati Raj Department after one month of cyclone Phailin. I observed that mangroves have lowered the full impact of cyclone in the coastal region. Even 50 km from the coast, the brick mortar schools were partially destroyed by the storms.  On enquiring about the relief work at block level,  I was given brief on the help provided by administration post disaster. There were 33,283 households in Bhanjanagar. They were provided with kerosene oil, jaggery and flattened rice (chuda) of two months supply. 50 kg of grains and Rs 500 were given to each household. Plastic cover roof was in demand more than anything. Ganjam was worst hit by the Phailin and the accounts were horrifying.

There is lack of access to basic resources to sustain livelihood for the community. There must be careful planning with Donor funds coming for rehabilitation. Poor countries have become fighting arena of NGOs on international aid after each disaster. And all the international aid and investment is mostly consumed by INGOs, private companies involved in the relief effort. Even missionary organization pops up for saving the soul of unbelievers post disaster with charity. When disaster strikes, who profits? This is the key question for policy level to eliminate corruption and inefficiencies. No other country in the world has more non-governmental organizations (NGOs) per capita as Haiti. Yet we all know about real face of international relief after 2010 earthquakes. (Source 1 and Source 2).

Link Worker Scheme

The Government of India estimates that about 2.40 million Indians are living with HIV (1.93 ‐3.04 million) with an adult prevalence of 0.31% (2009). For the readers, there is a popular myth that HIV, or AIDS is an urban disease. As per the HIV Sentinel Surveillance (HSS) of 2007, it was identified that 57% of the HIV-positive persons in India are estimated to be living in rural areas.

Under the NACP III, Link Worker Scheme was designed for rural prevention and NACO implemented this program with the financial support of Global Fund through Lead NGOs. Link Worker Scheme was launched to saturate the reach of HIV-related services to high-risk groups based in rural areas. The scheme aims to build a rural community model to address the complex needs of rural HIV prevention, care, and support requirements. Under this scheme, a person who has been trained and has been made responsible for carrying out specific activities is called a Cluster Link Worker. I visited the field office of Humana People to People India (HPPI) in Lucknow on a learning tour about the Link Worker Scheme. A Red Ribbon Club (RRC) in the villages has been formed to prevent AIDS. This was done due to the dormant village health committee and uneasiness among village elders to take up issues related to sexual health. I observed that women from higher caste and men are reluctant to talk openly. Cluster Link Worker told me about the few cases referred to STI services under this intervention. Information materials & commodities (condoms, needles/syringes) through collaborating with the nearest government health facilities have been distributed among the youth in the community.

Numerous NGOs and CBOs are working on HIV/AIDS issues in India at the local, state, and national levels. The events organized by NGOs are limited to shouting slogans and carrying placards depicting various messages related to HIV/AIDS. They also help in social marketing (SM) of condoms. The campaign uses targeted ads and community engagement opportunities to change the way men and women think about HIV/AIDS. The major reasons for AIDS can be attributed to Unsafe Sex and Low Condom Use. But it arises from the Low levels of literacy leading to myth and misconception. STIs very often go untreated due to both a lack of information and healthcare facilities. Stigma towards people living with HIV is widespread among urban and rural communities. Sex workers are hiding in plain sight.

The high-risk group (HRG) among the population includes Female Sex Workers (FSW), Men Who Have Sex with Men (MSM) & Injecting Drug Use (IDU). The Bridge Population is truck drivers, male and female migrants while the vulnerable Population constitutes migrant spouses, HRG spouses, and trucker's spouses. Youth migrating for work and trafficked women form a critical group because of their ‘mobility with HIV’. Migration for work leads them to new living and working conditions without family support. Sexually active age and separation from regular partners for extended periods predispose them to paid sex or sex with non-regular partners. Movement is not a necessary element in the trafficking process, with the mechanisms of deployment, payment of advances, and wages bearing a striking similarity across the country. The various reasons for trafficking are a result of a complex set of Gender discrimination, illiteracy, No sex education, violence against women, vulnerability and ignorance of girls, and finally lack of opportunity.

People have not suddenly understood the old arguments spread by social workers. There is a lot of awareness now of HIV than a decade ago and the attitudes about AIDS changing gradually. The HIV-positive population needs the provision of safe spaces and support systems to overcome shameful anxieties, fragile hopes, and guilt. I saluted the guts of the social worker who works in the community on such a taboo issue. Much moral courage is required to meet an outcast and convince a socially rigid community.   With consistent awareness, the masses get used to the message, and AIDS loses its disgust value. And the new generation is just much more open.

SHG Model and Financial Inclusion

SHG Model in India : “The tipping point is that magic moment when an idea, trend, or social behavior crosses a threshold, tips, and spreads like wildfire.” ~ Malcolm Gladwell.

This statement might have been just said on SHG (Self Help Group) movement in India. The rural landscape of India has mushrooming with SHGs. Formal credit system has, over the years failed to deliver in rural India. The transaction costs of the rural credit systems are very high and the system is plagued by non-performing assets. SHG were started as a pilot project of 500 SHGs, by Nabard in 1992, they grew slowly. SHG  are viewed today as an entry point in rural landscape for NGO, Bankers, government and even MNCs.

Self Help Groups (SHGs) are informal associations of up to 20 women (their average size is 14) who meet regularly, usually once a month, to save small amounts (typically Rs 10 to 50) a month. Majority of SHGs are single-caste groups based on basis of neighbourhood and affinity groups concept. Prof. Malcolm Harper notes three aspects with regard to using SHG groups  [Source]:

1) Groups take time, lots of it, and we have always said that poor women are very busy.
2) Groups tend to exclude individualist (sometimes they are called as entrepreneurs) who dare to be different, to do mad things like starting new types of businesses, which may even create jobs for others.
3) Men are generally bad at working in groups, and they take bigger risk and are less reliable than women, but when they do succeed they tend to create more jobs than women do, for the vast majority who prefer to employed than to be self-employed.'

Financial Inclusion (FI) in India [Source] -  Typically speaking, the scope of financial inclusion (FI) in India involves the following and related services (not exhaustive):

Access to accounts: a) Savings (No frills etc); and b) Current accounts.

Access to deposits: a) Fixed deposits; and b) Recurring deposits

Access to transaction banking: a) Use of cheques, demand drafts and other such instruments; b) Receiving of social security (NREGA and other) payments through bank accounts; c) Transfer of money through RTGS or NEFT and remittance services; d) Debit cards and ATM usage; e) Credit cards including KCC and GCC; f) Bill payments through technology banking - mobile banking, internet banking etc

Access to credit facilities: a) Typical priority sector loans for agriculture and allied areas etc; b) Post harvest, post production loans; c) Loans for marketing of agricultural and other produce etc; d) Traditional working capital limits; e) Traditional MFI loans under priority sector; f) Traditional SHG bank linkage program loans; g) Loans from specialised credit and other cooperatives; h) Traditional MSME loans backed by credit guarantee from Government of India; i) Housing/mortgage loans; and j) Various kinds of overdraft facilities and so on;

Access to risk management services: a) Life insurance; b) Health insurance; c) Asset insurance; d) Crop and weather insurance; e) Livestock insurance; f) Other such products such as credit insurance; and g) Micro-pensions

Access to other Services: a) Deposit insurance; b) business facilitators (BF) and business correspondents (BC); c) financial literacy services and credit counseling (FLCC) centers; d) grievance redressal, ombudsman and legal aid services; e) credit bureau; and f) Other services

The above services can be acquired through various institutions such as (but not limited to) the following: Commercial Banks, Regional Rural Banks (RRBs), Cooperative Banks, Local Area Banks (LABs), Post Offices, State Cooperatives, Mutually Aided Cooperatives, Multi-State Cooperatives, Investment Grade NBFCs, NBFC MFIs, BCs/BFs, Other MFIs, SHGs and so on.

SHG Model and Financial Inclusion in India

Government has been pushing banks to step up their financial inclusion (FI). Most of the financial inclusion has been limited to opening of No-Frill Accounts. Due to lack of financial literacy, program is not achieving the vision. Banks are fulfilling targets through intermediaries such as business correspondents (BCs). The limited amount of the BC works revolves around disbursement of government funds, small-value credit; recovery of principal / collection of interest; collection of small-value deposits and sale of micro insurance. Facilitating access to microfinance through SHG-supported bank linkages is one of the most critical aspects of our Financial Inclusion program. More on SHG Bank Linkages will be coming on the blog pretty soon.

e-NRLM

It is very essential for monitoring and evaluation to have solid data. There are thousands of functioning SHGs in the country. NRLM has taken step for transparency through data collection about SHG. MIS of NRLM is hugely important for tracking effectiveness of programs that would serve in a long way to establishing accountability at each level.

ICDS is already working with SHG movement in Odisha with Mission Shakti since 2003. Through validation and gradation of SHG in December 2012, Panchayati Raj Department was able to verify total number of SHG in the Odisha. Still, there was no concrete record of name of all SHG members. Name of President and Secretary can only be obtained through all given data. I formed a template as required for MIS and termed this E-NRLM format. Our OLM team at Bhanjanagar and Surada block of Ganjam district used Aagan Wadi Workers (AWWs) for collecting data about SHG.

Data collection exercise is a tough thing in India. Education of the most of the AWWs varies mostly from class 7-12 range. They are overloaded with core responsibilities and other auxiliary works. Other hurdles in data capture is Demand of Information in English Language. This is a huge problem at all India level as the necessary level of English is not achieved by  AWWs, GRS or any other extension staff. If we collect data in the regional language, it will be very tough for translating them in English for data operator sitting at block level. One more precaution should be taken while collecting data at rural level. Agriculture season shouldn't be selected for the exercise as women members are busy in all activities. That will add burden to AWWs and make process more tedious.

Gathered information is static in nature. We need to re-validate all old SHGs each year for any change in members, amount of savings and bank linkage history. There is need to colled basic information also need about new SHGs formed each year. There will be upcoming need to update BPL(Below Poverty Line) data related to SHGs in near future. Currently, 1997 BPL census data is used in Odisha for any scheme. 2011 BPL data will be soon made public and must be incorporated soon.  Why this is important ? Each government schemes has guidelines to select beneficiary mostly on the basis of either SC/ST or BPL card per household. Hence, a more transparent way will emerge with the help of this MIS.With each opening of bank branches (public and private) in the locality, they should be readily integrated in MIS data.

In a review meeting, we were battered by a senior officer for not taking ownership of the mission in data collection exercise. This task was not possible without having a single field staff dedicated for NRLM at our disposal till December 2013. And, nobody remembers all big talks of convergence of various government agencies! I was working at Balangir district where few villages/GPs name were missing from MIS. We readily took help from MGNREGS MIS software. Now, that is a fine example of convergence. We are collecting BPL card number instead of just writing yes or no in BPL column for e-nrlm. That is ensuring much transparency in the system. It is plan to do this data collection exercise each year conjoint with re-assessment schedule of all SHG. That will ensure much light on proper SHG health.

Social investment is not being done just be formation of SHG and quality is not being maintained as government is only chasing numbers. Our huge ignorance of how good or bad SHG works is barrier to their development. MIS is a tool that will be give quantitative answers. There is still need of huge qualitative data to explain the numbers. NRLM need rigorous and reliable information of impact assessment studies, social audit, panel studies etc. Open data-Base is a new kind of 'public good' that can be generated through this mission. With this huge amount of publicly available data disseminated to policymakers, industry, bankers, researchers, Academia, students and others can give more understanding social reality.

Visit for Social Audit of NREGS - 2

What is a social audit? It is better to have an idea of the concept in the first place.  Social_Audit_Report is uploaded to the NREGS website. But almost all of the community seems to be completely unaware of the documentation part. The best part of these meetings is the opportunity to meet office bearers and government officials on the same day.

When the government makes the schedule for a social audit in October, it reviews work done/in progress from April to September months. SA was originally scheduled in October but due to a cyclone, it was completed in December. Advertisements were given in three Oriya newspapers giving dates and locations of the social audit meeting. Local NGO was invited to attend the meetings yet no provision of funds was available for community mobilization through local NGOs. This was all done when Gram Rozgar Sevak (GRS) [working personnel for NREGS at Village level] were gone on strike. Their online petition is worth a read on the problem faced at the implementation level.

Verification of Documents, Grievance Submitted, and Issues was tackled in the meeting with sincerity. Whatever issues were raised and action was taken on them.  The normal complaint was the wrong account number given by beneficiaries of bank accounts. One person complained about having no job card. He later told that he was a migrant and belong to well to do family. Since this card is one more government paperwork done free, he was eager to get in hope of anticipated benefits. Ensuring faster wage payment to beneficiaries under MGNREGS is the process lacuna. Payment within 15 days deadline is sometimes stretched to full month that came in limelight.

According to the guidelines of MGNREGA, a Gram Sabha has held the prime institution of planning and execution of MGNREGA. So much in writing but activities of Vigilance and Monitoring Committees (VMCs) at the Panchayat level are in hibernation all over Odisha. NREGS work for purposes like common grazing and livelihood is not taken much into thought. NREGS website is great. But even the BPL (as per the 1997 census in Odisha) doesn't seem rightly fed in that. I have highlighted with a red circle in the picture above and brought it to the notice of the concerned authority.

There is no convergence that household has taken benefit from which scheme like IAY/RSBY of the government.  Even demand generation suffers due to a lack of initiative of community. As per government officials, not much work can be generated if a lot has been already done in previous years. There is a limit of demand that can be achieved under the guidelines of NREGS. The demand scheme has been converted into a target scheme by the officers under pressure from the government to show numbers.  That was the most important lesson that came out in this exercise.

Social Audit has merely been reduced as an exercise for checking numbers, as rarely people complained about the quality of work and let accountable pay for corruption. Even mighty monitoring tools like social audits can become grievance redress mechanisms only in the hands of the dull community. The social audit may have helped in awareness generation but a lot of work needs to be done for community engagement.

One Month at Bhanjanagar, Ganjam

I reported at DRDA office, Ganjam district on 18th November 2013. I was relived from previous duty for PHAILIN rehabilitation work. Emergency relief work had already been finished in most of the block. Hence, rehabilitation work is not included in my role at Ganjam District. I was assigned to work at Bhanjanagar block exclusive for Odisha Livelihood Mission (OLM).  Bhanjanagar block is a non intensive block as per OLM guidelines. A new proposal to change this into intensive block has been sent to the central government. That means a lot of action under coming months but not now. Revolving fund to SHGs, e-NRLM (MIS)and SHG Bank Credit Linkage are the focus area  in job profile.

OLM  , Panchayat Samiti Office, Bhanjanagar

Work Station

Every person worth its salt always knows how to correct itself, and eventually does. I feel vulnerable against myself. The trait of punctuality is leaving me even with the minor load of the government job. Hoping to maintain this habit of punctuality. I am ignorant about development issues to a large extent. I am focusing hard to be updated on each aspect of community and governance development. It a general truth that "No work, No Pay". Currently, assigned work is minimum at this moment. Let's have a thought, I feel like overpaid government officer !

Motivation for the Day: “If you're going to try, go all the way. Otherwise, don't even start. This could mean losing girlfriends, wives, relatives and maybe even your mind. It could mean not eating for three or four days. It could mean freezing on a park bench. It could mean jail. It could mean derision. It could mean mockery--isolation. Isolation is the gift. All the others are a test of your endurance, of how much you really want to do it. And, you'll do it, despite rejection and the worst odds. And it will be better than anything else you can imagine. If you're going to try, go all the way. There is no other feeling like that. You will be alone with the gods, and the nights will flame with fire. You will ride life straight to perfect laughter. It's the only good fight there is.” ― Charles Bukowski, Factotum

More Words, Less Work

Jargon is not monopoly of B School students, as they are also used excessively in the development sector. That is why practitioner doesn't read academic literature. The funny part is that the jargon such as 'Sustainable' and 'Strategy' in daily vocab as student is not coming any use to me. Development academics are known for their penchant for creating jargon where there is need for none, points out Pulitzer-Prize and Oscar-winning cartoonist and novelist Jules Feitter in his inimitable style.

“I used to think I was poor. Then they told me I wasn’t poor, I was needy. Then they said needy was an expression that is self defeating, I was actually deprived. Then again they said deprived created a bad image, I was actually underprivileged. Now they say underprivileged is inaccurate. I am actually disadvantaged. I still don’t have a dime, but I sure have a rich vocabulary!” – Jules Feitter

Producer Groups - Practical Experiences

"I learned very early the difference between knowing the name of something and knowing something."- Richard Feynman; That is why, despite knowing the theoretical concepts on the Producer Groups, there were some practical lessons gained in the field. I had worked with Producer Groups farming Groundnut, Onion, & Pulses (even one group was doing business of NTFP) at Balanagir district, Odisha. I was guided under the able supervision of Kamalendu Paul, Zonal Manager, ORMAS (Orissa Rural Development and Marketing Society). The document Community Enterprise System Manual prepared by Prof. Amar KJR Nayak came helpful during work.

All producer groups were having women members only. No producer group has been registered under any act till now. However, credit was given to them based on mutual trust between the government and Producer Groups. The legal process will be initiated soon. We were also unable to do protect farmers under the crop insurance scheme till this year. Organizing the unorganized was already done by Paul Sir before I arrived at the district. Without the help of local persons, this was not possible. The sign of government (even its vehicle) is a sign of trust in rural areas. That fast-paced our work even by Indian standards in establishing trust with the community. Our companies have usually dumped their substandard products and Chit Fund company had run away with the money of rural people. This historical tendency of companies has made business in rural areas difficult.

 

Practical Experiences:

1) 40-60 is the optimal size of the group. It is necessary for cohesion within and management of the group. Since they are small-scale, it is generally preferred that they are not much dispersed. There is an executive committee and further sub-committees in the Producer group. But, most of the members don't know the power, roles, and responsibilities of this committee. Since NRLM is a new scheme, we have to remind each time about the objective and scope of the mission to the members.

2) Producer groups were more successful in the remote areas of the district. The sense of cooperation is more seen in these regions in comparison to the relatively rich parts of the district. It is a small sample for me to draw conclusions but the poor are more honest and cooperative in nature.

3) For any business, 'budget' is the ultimate tool with which to monitor and keep an eye on the business. The lack of education becomes a major hindrance in the preparation of the annual action plans and budgets. It was easy to make them understand procurement procedures (like inviting more than one quotation) and the necessity of documentation. Since most of the women are part of SHG, they have a basic idea about documenting the meetings and cash book.

4) LSP (Livelihood Support Person) is appointed for their help in marketing linkages and proper documentation. Producer Group is more considered for a good price while the government is more strict on documentation part. An honorarium of LSP is merely 2000 -3000 rs currently. That may appear low but as per my opinion, is sufficient if billed on RS 50 per hour of interaction. Work of LSP is maximum during the post-harvesting season.

5) I have attained lectures, read articles, and even studies courses on leadership. Cooperative Leadership is not just about good communication skills, democracy – it's about sound decision-making by utilizing the capacity of the group. A producer group like any other group is leader-oriented. The trivia is that an exterior person like LSP should enable but should never drive the Producer Group strategy. Since I have been working with women producers and male LSP, this scenario may occur in the future. A leader should be groomed inside the group. Even on the proxy of gender diversity, there was only a single woman among all appointed LSPs.

6) Another difficulty that the producer group or cooperative societies encounter relates to storage facilities. Most of the surplus produce in an area is assembled and sold at the mandi. Infrastructure support is a must for the producer group. Most of the farmers even if organized for the production purpose are reluctant to store for a long time to meet their immediate consumptive need. A low-cost storage facility for multipurpose use at each GP/ village for each producer group is a good solution to the problem. It may appear cheap and effective under Panchayat but the chances of either personal usage by PRI members or no maintenance are more in it.

7) The transport arrangement to market a small volume of produce is not facilitating and rural transport cost is much higher than the urban transport cost. Hence, by combining the total produce, we were able to bring businessmen to the doorstep of farmers.

8) Line departments like Agriculture Department and its extension services support have been minimal till now. Convergence is always missing in between government departments! We are hoping for their help during the training session of producers. The fund supplied for training purposes by the government will be used in the future. The caveat of guidelines in utilizing training funds: Only half of the group will get the training. A sure way of creating a rift between members. It is better to spend less on training per member but to impart training to everyone in the group.

9) There was not much inclusion of banks till now. Without any corpus fund provided as a grant, it was difficult for a bank to provide the loan amount. And, Banks heavily discourage and delay SHG/PG  members making transactions to the respective branches. That is a big issue with multiple perspectives to be debated later.

10) Agri Produce Market is not very quality conscious, but price-sensitive to a certain extent. The credit supplied to PG is used for holding the collective produce for one or two months. In the meantime, there is a definite rise in the prices of produce. We have experience of selling Pulses for a profit of more than Rs 10 per kg by holding the stick for a period of one month.

Failure of Cooperative societies should never be forgotten in the Indian context while pitching support for such groups. Cooperative societies were not harmed much by politics but by the interference of the bureaucracy. Lack of serious attention to value-added agriculture and rural MSMEs is a big task to be handled in the future. How do we make agriculture sustainable and economically viable? That is the big question.

Initiative Taken:

Previously, only office bearers and LSP words were taken for granted in meeting at district-level meetings. Producer Group registers were the only way of checking regular meetings and updates during field visits. I have collected the maximum available mobile phone numbers of members. Hence, I can actually monitor live, whether PG meeting is happening or not from district headquarter through random calls to any member.

- A DPR (Detailed Project Report)was approved by OLM (Odisha Livelihood Mission) last year. There was no provision of a baseline survey. I tried to capture data about household socio-economic conditions so that impact assessment can be made in the coming years.

Producer Groups - Theoretical Concept

"Where the poor participate as subjects and not as objects of the development process, it is possible to generate growth, human development, and equity, not as mutually exclusive trade-offs but as complementary elements in the same process." --- Meeting the challenge, Report of the Independent South Asian Commission on Poverty Alleviation, 1992.

The problem with the modern outlook of business education is to view rural/urban citizens as target consumers. Instead, if we enable them as producers, that will surely boost the economy and well-being of our producers. Most of the producers are caught in the vicious circle of poverty and even fully dependent on the monsoon for a good harvest. The government has reworked its strategy of helping marginal and small producers in breaking out of the cycle of poverty by organizing them into producer groups. The concept of Producer Group has been lifted from the cooperative societies. This concept is based on voluntary cooperation as the rural ecosystem has limited resources and infrastructure.

Why Producer Group? The main aim of the producer group is to stop the practice of ‘distress selling’. I will give three reasons for pitching Producer Groups. 1) Creditworthiness is directly related to income, farm size, age of farmers, and level of formal education of farmers. Hence, the marginal farmer is always caught with a lack of credit. 2) Marginal farmers as rural producers always suffer from an imbalance of bargaining power in market transactions. 3) Small farmers always dispose their produce at the nearest mandi at a through-away price. The size of the market for agri-related commodities is always good but highly price volatile in India. I have written more on this topic: Market Failure and Primary Producers.

A producer Group generally consists of 30 to 150 producers [depending upon nature of the Livelihood Activity] involved in a common activity. Producers groups should be formed preferably at the village level or at the GP level for tribal areas where the size of the village is very small. Producers Group may be registered under the Self Help Cooperative Act, 2001 of the Government of Odisha (Depending on the state) or The Companies Act of India in the future. As per new NRLM guidelines, a minimum of 50% of the total members should be from the BPL category. That is a good strategy for poor and vulnerable households.

There will be service charges taken from the members for purchase and maintenance of common assets like mattresses, Chairs, Lock, Box and Weighing machines. There will be the engagement of a professional resource person called LSP (Livelihood Support Person). LSP will help them in procurement, processing, value addition, and market linkages. However, the cost of LSP will be borne by the government for initial two years depending on the honorarium decided by the Producer group. There is a provision of financial (Loan for working capital @7 % & Grant for capacity building through training) for producer group.

Generally, Indian farmers have a highly unorganized and individual approach to cultivation. Organizing the unorganized through mobilizing the whole community is the most time taking part of the formation of the Producer Group. The first step within business planning is to identify the business opportunity. This is decided by members Producer group itself only. Ensuring regular meetings and interaction from a government official is a way to sustain the producer group. With enhanced collective bargaining power, Producer groups are obtaining good prices for their produce in the market. Still, there are many practical difficulties in the whole approach. That will be taken later in a new blog post.

Pointers for Rural Managers

There are 6 lakh villages across the country. It is essential to know about government schemes and local culture while working in rural India. They will always come handy in certain situations. Great debate on caste system has not been touched by me where majority of Indians follow an unwritten rule of not mingling through marriage of one religion or caste.

Hindi Calendar Months:

Important Festivals: I am not elaborating on Festivals in India that consumes a major part of government holidays. Just few minor ones, that may be unheard by most of us.

Akshya Tritiya - Day for worshiping traditional seed-before ploughing and sowing of seed.
Makar Sankranti / Onam- It is a harvest festival.
Vasant Panchami - This dayannounces arrival of spring.
Gudi Padwa/ Ugadi/ Bihu/ Vishu - New Year in Hindu Calendar
Navarathri - Celebrated five times a year but primarily once during spring.
Ramadan - A month of fasting for Muslims.

Important Schemes:

1- Poverty Alleviation Schemes : National Rural Employment Guarantee Scheme (NREGA) and National Rural Livelihood Mission (NRLM)
2- Education Schemes : Sarva Shiksha Abhiyan (SSA), Mid Day Meal Scheme (MDA), Adult Literacy.
3- Water and Sanitation : National Rural Drinking Water Programme , Total Sanitation Campaign.
4- Health : National Rural Health Mission (NRHM)
5- Women and Child Development : Integrated Child Development Services (ICDS)
6- Rural Housing : Indira Awas Yojana (IAY)
7- Rural Roads : Pradhan Mantri Gram Sadak Yojana (PMGSY)
8- Rural Electrification: Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY), Remote Village Electrification Programme (Non-conventional energy)
9- Hunger Reduction : Public Distribution Scheme (PDS) and Antyodaya Anna Yojana (AAY) . (Upcoming Food Security Bill,)
10- Entitlements : National Old Age Pension Scheme (NOAPS), National Maternity Benefit Scheme (NMBS) and National Family Benefit Scheme (NFBS).
11- Rural Infrastructure : Bharat Nirman Seva Kendras and Telecommunication Connectivity.

Quote of the Day: “My mother said I must always be intolerant of ignorance but understanding of illiteracy. That some people, unable to go to school, were more educated and more intelligent than college professors.” — Maya Angelou.

Transfer Order

The official stint at Balangir is over after 175 Days. I have been transferred to Ganjam district that will be effective from 18th November 2013. Life will be turbulent, may be good in coming weeks.

Since, Ganjam district has been badly affected by the PHAILIN and followed by flood due to incessant rain, it was decided to relocate eleven Young Professionals for the rehabilitation and restoration work. Transfer Order is little puzzlinh while looking at overall context of the decision. Currently, there are 36 Young Professionals employed at Odisha Livelihood Mission. There will be thirteen Young Professionals working at Ganjam district now with this official order. There are districts like Mayurbhanj, Kendrapada, Balasore and Bhadrak affected by cyclone and flash floods. No Young Professional is placed there for rehabilitation work. Hence, this skewed decision appears bias to me.

Change is constant but its hard to guess pace of the change. There is an expression that “failing to plan is planning to fail.” While it is partially true that those who fail to plan will eventually fail in achieving their goals, there is strong evidence to suggest that having a plan leads to greater effectiveness and efficiency. I am hoping for better and optimum utilization of time at new place. Dreaming to come up with self-correcting mechanisms against habit of procrastination. Self-image, hopes and dreams matter, not as part of vanity, but for the choices that I will make.

Thought of the Day: The plain fact is that the planet does not need more successful people. But it does desperately need more peacemakers, healers, restorers, storytellers, and lovers of every kind. It needs people who live well in their places. - David Orr.

Look Beyond GDP !

It is a popular quote by Friedrich Nietzsch : All things are subject to interpretation. Whichever interpretation prevails at a given time is a function of power and not truth. Elite and educated Indians have high obsession with two parameters for judging development in India either GDP growth rate and numbers of stock exchange. I will discuss about GDP and similar indicators. GDP is a good indicator but doesn't show up complete picture. It does not take into account income distribution.

Let us talk about Per Capita Income. It is calculated by taking a measure of all sources of income in the aggregate (such as GDP or GNI) and dividing it by the total population. So, its just an average ! Hence, increase in wealth of Tata, Birla and Ambani can show up good figures for India but can't really reflect development of a common citizen. Let us use three global indices of development for comparison:

1. GCI (Global Competitiveness Index): issued by World Economic Forum, and is based on a composite ranking of growth potential, business competitiveness, etc. India ranks 64 among 152 nations in 2013-2014 report.

2. HDI (Human Development Index) : issued by UN which is a composite of education, per capita GDP, longivity, etc. India ranks 136 among 186 nations in 2012.

3. Gini Index: this a part of HDI, which ranks countries according income disparities in the society. A Gini index of 0 represents perfect equality, while an index of 1 implies perfect inequality. Although income inequality in India is relatively small (Gini coefficient:0. 325 in year 1999- 2000), India's nominal Gini index rose to 0.368 in 2005. [Source]

Hence, we are a country with high growth rate and still lacking in basic facilities like health and education. Only figures does not explain this position. I will give data for the reasoning. Let us ask a basic question : Can bad policy decisions block development in a country like India that has many aspects of inclusive institutions ? Yes, that is cent percent true for India. Kothari Commission (1964-66) suggested to allocate 6% of GDP for public expenditure on education. Leave the past, even in the last decade, we haven’t spent more than 4 % of GDP. (Source). Our expenditure on public health hasn't gone up more than 4 % of GDP from may years. Figures of any developing or developed country (Turkey, USA, UK, Brazil and SA) is always more than 6.5% from last 20 years. (Source)

As an approach to development, Ferro et al. (2002) were of the view that pro-poor growth in India can rest on two pillars—by grouping policies for improving the investment climate to accelerate growth and for empowering its poor to contribute and benefit from this growth. Robustness of the economy is a must thing but a significant investment must be made in people's lives. We have today thriving yet highly privatized health and education systems (with very different opportunities for different class). With the exit of middle class using public facilities, the bargaining power of remaining users has declined. Due to less investment by state in increasing its capacity, health and education have became costly affairs in private hands. We must think of households who have to spend a good part of their income to buy good health and primary education facilities in private sector – leaving a much bigger gap in the pocket that can be invested in their own or children’s future.

There are always enough reasons to despair and hope in India. Recently, Raghuram Rajan Committee Report has recommended for evolving a Composite Development Index for States. Kudos for new way of thinking ! Development is about a healthy community of economically active people. Hence, we need to see more than one indicators in popular media as well to get the complete picture. If someone is still not convinced , please march ahead and read : It’s Not The GDP, Stupid!

Visit for Social Audit of NREGS

NREGA funds are used for natural resource management activities by generating wage employment for the poor as well as strengthening their livelihood resource base. I will ask readers to go through these two articles :[ Rural job scheme: Can we get it right? and NREGA social Audit: Myths and Reality ] on Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) before going forward.

There is social audit of MNREGS going on in Balangir district from 22-10-2013 to 26-10-2013. I attended three such meetings as an observer only. I attended social audit at Kutenpali, Jharmunda and Kandajuri Gram Panchayat of Loisingha Block. Loisingha Block consist of 18 G.Ps with 108 Villages and is 22 km away from district headquarter. The officers, Sarpanch and GRS were present for the meeting on time. Yet, there was lack of people attending the meeting held at Panchayat Bhavan. The registered person data is taken from NREGA website for the financial year 2013-2014. I have given distance from Block Office to show their remote locality.

G.P.	Distance from Block Office	Registered				In Meeting
		Household	Persons	Male	Female	Total	Male	Female
Kutenpali	7 Km	674	1899	1076	823	40	40	0
Jharmunda	12 Km	661	1686	983	703	0	0	0
Kandajuri	15 Km	457	1075	596	479	7	7	0

Key Findings -

1. There were people keeping themselves busy in a game of cards but were unaffected by any meeting. This attitude of local people was fatal to their own development. Hence, all the blame of failure of government scheme can't be solely put on the state. The lack of participation of the local population was making the whole event into a flop show.

2. GP with 40 people was considered as success by block office. It was later told that such low attendance of 5-10 people without any local NGO participation is prevalent in another block of Balangir district. With the support of community based organization, the number of participants can rise upto 80-100 maximum.

3. There was notice attached to the Panchayat office but no meetings were held on the importance of social audit. Adding to this limited communication, effective strategy of rural communication through vocal was also utterly discarded by the government. Neither NGO nor any community organization was used for mobilizing the public.

4. Land development through individual project is equally good option with community project in the remote location. Due to hilly terrain and poor connectivity, there is greater participation in NREGS in backward GPs. Most of the people working as labour in NREGS are tribal and BPL card holders.

5. The Gram Panchayat must own the data it collects; Information is a basic tool for planning. Information relevant to each area like population, Infrastructure and natural resources database is rarely available for use. Even NREGA data is available on the internet yet not available to common man in the village. Virtual transparency may give temporary relief to the government officials, whereas the reality is that villagers have to meander through a cobweb of data to search and find what they are looking for.

6. Surplus labor used in NREGS can generate productive assets that can be eco-friendly in nature. The asset base of the poor both individual (for example, Land leveling, reclamation of soil, bunding, constructing small ponds) as well as collective assets (for example, regeneration of common lands, water harvesting structures, group irrigation facilities etc) can be strengthen through this scheme. Migration of unskilled labors can't be stopped with virtually 30-40 days of the work.

In NREGA, government officials and PRI members had used fraud measures like “creating fake muster rolls, inflated bills, exaggerated measurements, and non-existent works, all through bribes and cuts from wage seekers" to make money. What need of hour is social audit, best tool we have for monitoring using community participation to curb such fraud activities. Development from design is not primarily about selecting right people for the job. It is about setting of right processes, standards and procedures followed with continuous adherence to it. I will end with the words of Omnia Marzouk, President, IofC International - : 'Nothing lasting can be built without a desire by people to live differently and exemplify the changes they want to see in society.'

Rural Managers: Their role from a development professional's view

[ This post has been taken from 2013 edition of Dhwani, the annual journal of published by RMAX [ Rural Manager's Association of XIMB (Xavier Institute of Management, Bhubaneswar)]. Content has not been tampered but published without prior permission. Please contact blogger in the case of any dispute/offence/copyright issues.]

Author : Mr. Shouvik Mitra, World Bank Consultant

The development sector has seen a sea change over the last four decades starting from the Sarvodaya movement, primarily inspired by the Gandhian philosophy in the early sixties to the professionalization of the sector in the mid eighties where NGOs like PRADAN and MYRADA came into existence to the near corporatization in the first decade of this century. Thus, with the evolving scenario the role o f r u r a l m a n a g e r s h a s c h a n g e d drastically. When Dr. Kurien established IRMA in 1979, the goal was to develop professionals to work for the sector in general and for AMUL/ GCMMF in particular. Today, rural managers are involved in organizations ranging from grassroots level NGOs, secondary support NGOs, donor agencies, private foundations, agri-business entities and social enterprises.

The role of a rural manager, over a period of time, has become more evolved, more sophisticated and more complex. This change in role is due to the change in contexts in which rural managers work. These contexts have opened many new opportunities for rural management as a field to grow. However, the same contexts have given rise to some peculiar challenges for rural managers. Let us take few examples. Most of the NGOs today face certain major organisational constraints, such as, funding and limited outreach. This along with sector specific demands, multi-dimensionality of rural poverty as well as high donor expectations poses a unique set of challenges in the face of rural managers. The Government being the largest player in rural development sector is worried about quality and efficacy. The donors and foundations are facing constraints of dwindling innovativeness, quality partners, timely delivery and measurable impacts. The entrepreneurs are facing capital constraints, government policies and quality human resource. The agenda of inclusiveness is going through a major drift among the corporate agri-business entities while the corporate social responsibility wings are too focused with R&R, establishing brand value and a general lack of understanding of the way forward. Another new concept that has emerged is Producer Collectives. Though their presence is still on a relatively smaller scale, they not only face issues of quality HR, capital constraints, and lack of mission but also suffer from governance issues and member-organization conflicts.

Poverty is complex phenomenon and there is no single silver bullet to wipe it out. And it has become extremely critical to work on several fronts simultaneously to tackle it effectively. It is now rare to find organizations working in a dedicated domain like health, education, empowerment, livelihoods. The recent mantra is overall well being of community and thus the organizations prefer to work across multiple sectors, though many of them continue to have a core competence in one or few of the sectors. This has necessitated knowledge across different domains for professionals working at the grassroots level.

Another challenge for the demographers today is migration, the solution to which is to provide ample employment as well as self employment opportunities in rural India. The need is to tackle this situation by proposing ideas for self-sustaining business models which not only generate revenue for the corporate but also proves beneficial monetarily and socially for people at the base of the pyramid. It is here that rural managers, armed with a combination of business acumen and compassion can contribute the most. Majority of social ventures fail to scale up due to lack of managerial skills. Similar is the case with implementation of a number of government schemes. To justify the claims of 'social inclusion', it is important for the development agencies to broaden their horizons to include a whole range of beneficiaries and not just a minor part of the population. All sections of the society are equally important to achieve the goals inclusion.

A rural manager thus needs to juggle with a number of issues and come up with optimal solutions in whatever organization s/he may be working. S/he is expected to deal with organizational staff, ground level workers, outside/intervening agencies, rural community members, all at the same time.

The question to be asked here is how one can equip oneself to cope with such diverse and demanding situations. Is only a rural management degree itself a sufficient condition to be an effective rural manager? I doubt it. The right kind of attitude is of paramount importance; an attitude to work with rural poor in a manner which is professional, yet tender and at the same time not compromising on the quality of the outcome. What is required is a delicate balance of both head and heart where one is hardnosed about the efficacy of the project and is also concerned about the well being of the community. There is hardly any room for trade-offs. S/he must be able to analyze the situation and visualize the possible solution. It is required from him/her to be willing to unlearn, learn and relearn continuously and over a period of time.

Why Government Schemes Fail?

All claims of the development by the government appear to be a hoax ...obviously ! Because we always see huge margin of difference between announcement and implementation. Let us redefine government for our own understanding. It is a crucible of interest groups, rather than a black box of noble intentions. So, the responsibility of failure of schemes lie with various stakeholders in the development process.

Growth can never be inorganic and the system needs to learn before they grow. Now replace the system’ with a ‘welfare scheme’. Example: Gradual improvement (IRDP - SGSY - NRLM) is better approach for development. Not all schemes are so much lucky. They are renamed and often termed as 'old wine in new bottle'. Sometimes if any scheme is a completely prone to the corruption, we have hinged for its immense benefit to power holders. Bad schemes is like giving perpetual gifts that has made people into beggars rather than partners. India's government programmes are riddled with corruption and leakage. The main source of corruption arises from the identification of beneficiaries. Identification is not a statistical exercise, but is a major political activity. Nitin Pai has written an article focusing on this issue only - Where are the Poor?.

Rajiv Gandhi’s famous and oft-quoted statement that out of every Rs 1 spent on development only 15 paisa reaches the poor. Monitoring and Evaluation is often the weakest part of the chain of the schemes. Officials are getting salary for what they are supposed to serving the people. They get away clean either with not doing anything at all or doing with bribes. This is the most damaging aspect of the government jobs. Even harsh reviews and suspension does not mean anything to them.

Unused knowledge is a buried treasure. Government officials at block levels have brilliant expertise but they rarely display an ounce of integrity. The block level officials and extension workers are inadequately available and most of the posts were vacant. So, the staff is always overburdened by additional charges. None of govt official will talk openly of their exasperation with the stiff deadlines. But off the record, most are forthcoming. And, their feedback is rarely taken serious. There is also lack of specialization at the top level of bureaucracy. Same officer can look sports affairs with equal expertise as livelihood ! Such is the way of functioning government. This system has began to change positively from the last 10-15 years with the incoming flux of new officers. 

The reformers calling for heads of government servants and public representatives are not free from all blame. I will not give detail here in the corrupt practices of NGO sector but will take a dig on activist mode workers. Most of the activist are either committed right Swadeshi or a leftist social workers . They are staunch and passionate persons who are anti-globalization, anti- market and assumed that all decisions however big or small had to be taken in GramSabhas and will turn up invariably the right ones. Hence, not all feasible solutions are put on table and negotiation becomes ideological battleground.

Poor can not be served poorly; Government must stop thinking that PRI as low-cost and voluntary. People’s Participation for Empowerment and Good Governance may sound like a jargon in the reading but it is not. It is a simple process of taking voice of an important stakeholder i.e. public. There will be corruption in the early years, but surely spread of awareness will happen in upcoming years.

The hunger and poverty that one sees all around must be tackled with better designed scheme. Structural transformations at the top to allow local actors to participate with their potential is required. We must focus on convergence of existing schemes of the government rather than launching new schemes. Only then, we can roll back redundant schemes and put in their what is required. Even we got a new scheme. "The Implementation Part" is key to measure any success of intervention rather than allocation of fund. I will leave readers with quote by Pratap Bhanu Mehta, president, Centre for Policy Research, Delhi in his article "The contractor state": The government of India is a government of contractors, by contractors, for contractors.

Market Failure and Primary Producers

There are two factors that affect the lives of farmers - Lack of financial planning and Information Asymmetry. Let us roughly cash flow of the marginal farmer (as owner or tenant or share cropper who cultivates agricultural land up to 2.5 acres) that will fall into low-income households. The cash out flow of the household is throughout the year and peak-out during festive season, marriage or birth) and bad patches (accident/death) in the family. The farmer gets cash inflow with sales of produce only. Hence, the borrowings of the farmer limits the growth option for the household.

Let us take an excerpt from the paper - Why Don‘t We See Poverty Convergence? by Martin Ravallion  - "Banerjee and Duflo (2003) provide a simple but insightful growth model with borrowing constraints. Someone who starts her productive life with sufficient wealth is able to invest her unconstrained optimal amount, equating the (declining) marginal product of her capital with the interest rate. But the 'wealth poor' for whom the borrowing constraint is binding, are unable to do so. Banerjee and Duflo show that higher inequality in such an economy implies lower growth. However, they do not observe that their model also implies that higher current wealth poverty for a given mean wealth also implies lower growth.."

There is failure of state even in few cases as farmer sold paddy at 900 Rs. to the middleman against the minimum support price of 1250 Rs. This was bought in my notice during a meeting with SHG woman at Khaprakhol block of Balangir District. Hence, the information asymmetry is a definite factor for the problems of primary producers. Let us take the case of Cotton producers at Balangir. Most of the farmers avail credit, fertilizer and seeds from the middlemen. Hence, they are forced to sell their produce to the middlemen. They mostly sell at the price negotiated upon irrespective of the price prevalent in the market. In almost all cases the negotiated price for future output is 10 to 30% lower than the market prices.

Since the cash inflow with the farmers happens only in time of sale post harvesting season. Hence, it is very hard for farmer to negotiate with the creditors, middlemen and even local traders in terms of price of the produce. Farmer is forced to sell the producer soon after the harvest. This phenomenon is called Distress Sell. The lack of holding capacity reveals failure of credit mechanism of government. Through better connected network and information, the middlemen are always able to better estimation of price of the commodity. This price distortion has been brought lower due to reach of mobile phone connectivity. This can be countered by providing loans to hold sale of harvest for few weeks/months and installation of the mini warehouse facility at the GP level.

The market failure is typically attributed to information asymmetries—that lenders are poorly informed about borrowers. But we will go more in the topic of distress sell. Let us see State Wholesale Prices for Onion in Orissa (Rs/ Quintal) [Source - http://agmarknet.nic.in/]

Months	Wholesale Prices (Rs/ Quintal)
April,2013	1500.81
May,2013	1607.41
June, 2013	1826.3
July, 2013	2556.19
August, 2013	4954.79
September, 2013	4056.14

What we see is the clear evident of the rise of price of Onion to 150-300% soon after harvest season of April and May. So, the actual producers are not getting benefit of the high prices of onion due to distress sell while traders are making money out of the misery of customers. While we talk about food inflation greatly, it has nothing to do with supply demand constraints in India. Its simply linked to hoarding and profiteering. I don't have concrete evidence for this fact, hence will not raise this issue.

Looking from the perspective of the neo -liberal, local traders are managing risk. But, through current practices, we are making agriculture unsustainable and economically nonviable for a small farmer. There are folk idioms like "Des bigade maarwadi, sadak bigade bael-gaadi" prevelant in the rural India. Local traders (often Maarwaris) whatever their motives, have done much to built the market in our country. What we need is inclusion of small farmers as players in the market. It is only by forming networks and communities built on solidarity that marginal farmers can make a difference. The main objective is get the remunerative price for primary cultivators and distress sale should be checked. That will be explored in the future posts through topic like Producer Groups

Government Schemes and Development Programmes

Livelihoods Initiative at CMF has complied a list of government schemes that focus on livelihoods promotion, broken down by state that is updated by latest August 2013. I am updating here name of schemes implemented in Odisha.

Social Security

• Antyodaya Anna Yojana (AAY)
• Annapurna Scheme
• Anganwadi Karyakartri Bima Yojana
• Emergency Feeding Programme
• State Old Age Pension (SOAP) Scheme
• National Social Assistance Programme for Social Security Pensions
• National Old Age Pension Scheme
• National Family Benefit Scheme
• Balika Samriddhi Yojana (BSY)
• Jana Seva Divas - Streamlining of the process of Pension Payment
• Programme for Care of Older Persons
• Day care Centre
• Prevention of Alcoholism and Substance (Drugs) Abuse.
• Scheme for Welfare of Orphan and Destitute Children
• Orissa Disability Pension (ODP) Scheme

Welfare

• Rehabilitation of distressed women
• Balika Samridhi Yojana
• State commission for Women
• MVSN
• An Integrated programme for Street Children
• Training & Rehabilitation of Persons with Disability
• National Programme for Rehabilitation of Persons with Disabilities (NPRPD)
• "Preservation and Promotion of Tribal Dialects, Culture & Livelihood"
• Special Programmes for KBK(Kalahandi-Bolangir-Koraput) Districts
• Multi Sector Development Programme(MSDP)
• Multi Sector Development Programme(MSDP)
• Backward Region Grant Fund (BRGF)
• Gopabandhu Grameen Yojana

Health

• Janani Express
• The Integrated Child Development Services (ICDS)
• Scheme of Awards to Angawadi Worker
• Kishori Shakti Yojana
• National Nutrition Mission
• RevisedNational Tuberculosis Control Programme (RNTCP)
• National Leprosy Elimination Programme (NLEP)
• Iodine Deficiency Disorder Control Programme (IDDCP)
• National Vector Borne Disease Control Programme (NVBDCP)
• National Programme for Control of Blindness (NPCB)
• Integrated Disease Surveillance Programme (IDSP)
• Immunisation Programme
• Reproductive Child Health
• National Rural Health Mission (NRHM)
• Infant Mortality Rate Mission
• Navajyoti

Livelihoods Promotion

• UDISHA - The National ICDS Training Programme
• Women's Empowerment Programme - Mission Shakti
• Swayamsiddha
• Support to Training and Employment Programme for Women (STEP)
• Women's Economic Programme (WEP) - Swablamban (NORAD)
• Swadhar
• Supply of Special Aids & Appliances
• Training Centres for Teachers for Students with Disability:
• "Orissa Tribal Empowerment and Livelihoods Programme (OTELP) (EAP)"
• Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA)
• National Rural Livelihoods Mission (NRLM)

Education

• Midday Meal Scheme
• Special Schools for children with disability:
• Construction of 1000 new Girls Hostels