“Promoting Agriculture based Livelihoods for Rural Youth”

Presentation by B.L.ParthasarathyCEO, BASIX Consulting

Technical session V : Farmer centric approaches, Small Agri-business

Models, Development of social and human capital

National Conference on KVKs24 October, 2013

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The world’s leading provider of Livelihood Promotion Services, 13 Group entities, 6000 outlets Served over 6 mn customer cumulatively since inceptionPresent in 26 states of India, working in 7 least developed countries Pioneer and largest distributor of micro-insurance and micro pensions in India, Leader in financial inclusion and mobile payments in India.Pioneer of energy and environmental services, including climate change, and aggregating micro carbon credits Pioneer in fee-based agricultural and livestock enterprise development services and in vocational training for youth.Owns/runs in AP and Karnataka India’s only Micro Finance Local Area Bank licensed by RBI

BASIX Social Entreprise Group – A Mission Driven Pioneer

Rationale• Based on various studies and review, it was felt that, financial services alone would not be sufficient to promote sustainable livelihoods of the poor.

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Therefore BASIX adopted to deliver credit plus services to the customers

Production

• Lack of adequate extension services• Shortage of inputs, on time• Low productivity• Traditional practices

Supply Processing Marketing

• Losses in transit• Lack of village / cluster level small Storage facility• Poor transportation facility• Many layers between production and markets

•Very small quantity of agri commodities processed• Poor processing facility• Lack of know how

• Lack of grading facility • Inadequate access to markets

• It is essential to adopt holistic approach for providing the real benefit to farmers

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Institutional Development Services

Organising Producers’ Groups

Capacity Building

Sectoral & Policy Work

Financial Inclusion Services

Credit

Savings

Insurance

Pensions

Remittances

Agriculture, Livestock and Enterprise Development

Services

Crop

Dairy

Micro Enterprise Services

Skill Development

Market Linkages

BASIX Livelihood Triad Strategy

Agriculture and Livestock Enterprise Development Services (AgLEDS)

Elements:

•Productivity Enhancement

•Risk Mitigation (non-insurance)

• Local Value Addition

• Alternative Market Linkages

Package of Services to Crop customers

• Productivity Enhancement through Package of Practices

– Soil testing, Vermicompost and Integrated Nutrient Management

• Risk Mitigation– Seed treatment, Stem

application, Integrated Pest Management

• Local Value Addition– Semi-processing (e.g. ginning

of cotton, shelling of groundnut pods)

• Alternate Market Linkages for better prices (Super Spinning Mills, NCDEX)

• Establishing/strengthening farmers’ cooperatives for input/output mktg

Enhanced Production in Cotton

Linked with Market

Package of Services to Dairy farmers

• Productivity enhancement:

– Artificial insemination, Supply of quality fodder seed, Azolla culture, Silage, Fodder management

• Risk mitigation (non-insurance):

– Vaccination (preventive)

– Deworming,Veterinary care ( curative)

Azolla Culture

Deworming

Package of Services to Dairy farmers

• Local value addition:– Milk a. Hygiene milk production, b. Milk products : Srikand, ghee,

sweets, ghee, cova , butter milk

– By-products a. Compost preparation , b. Cow urine as

pesticide, c. Bio-pesticide

formulations• Alternate Market Linkages :

– Formation of milk routes, establish linkages with APDDCF, Heritage, Jersy etc..,

– Reviving the defunct chilling centres/Bulk cooling units

Cova Preparation

Linked with market

Other interventions

1. Dairy Value Chain Intervention – Reliance Dairy Foods; Mahabubnagar District

1. 500 farmers; 30 villages2. 18 Producer Groups formed3. KBS BANK credit linkages provided4. BASIX Provided Ag/BDS

2. Vegetables Intervention – ITC; Hyderabad 1. Push carts were provided by ITC 2. Ag/BDS services were provided 3. Market Linkages were established

3. Sweet Orange Market Linkages – Reliance Fresh; Mahabubnagar District

1. Sweet orange farmers were registered for FMS 2. Direct Market Linkages were created with Reliance Fresh

4. Mango Market Linkages – Jain and Other players; Vizianagaram District

1. Mango cluster has been identified for FMS services 2. Market linkages efforts started for the coming season

AGLEDS Partners

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Among the top 10 Global MFIs in MIX Global 100 Composite Rankings in 2010, with a pan-India presence,

Cashflow based lending model, giving individual loans with joint liability, and monthly or harvest time repayment. Not a Grameen Bank replicator.

Offers life, health, crop, livestock and asset insurance on behalf of insurance cos. Over 100,000 insurance claims settled to date

Only MFI providing Agriculture and Livestock Enterprise Development (AGLED) Services besides micro-credit

Only MFI operating 4500 CSCs (IT Kiosk) network in 5 states.

BSFL- the flagship of BASIX Group

Social & Environmental performance

CGAP Gold Award for Social Performance. Reporting. Adopted Triple Bottom Line.

Working in poorer states and with poorer segments – women, Dalits, Tribals

Offers environmental loan products and services such as for organic vermi-compost, solar home lighting, safe drinking water, toilets and micro-carbon credits

Institutional Profile

BKSL provides diverse range of crop,

dairy and non-farm sector services BASIX was the largest private sector

provider of agriculture extension

services in India, with more than

800,000 customers

Products & Services

Productivity enhancement Risk mitigation (non-insurance) Market linkages –input & output Formation and development of producer

groups/farmers clubs

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BKSL - India’s largest agro services company

Livelihood Options

• AGRI Enterprises : – Smallholder farms becoming viable businesses – Financial services, Business

development services, market access

• Technical services– Skilled workers: seed production, para-veterinary services etc– Horticulture nurseries, tissue culture, – Entrepreneurs : Seed production, Fish fingerling production,

DFL production,

• Institutional development services – Seed production, intermediate processing– Procurement, Sales & marketing of input and output – Accounts & book-keeping, MIS, business planning,

Private and Confidential

Rationale

Institution Development – Farmer Organisation

• Small Farmers’ Agribusiness Consortium (SFAC) is leading an initiative to incubate 250 Farmer Producer Organizations (FPOs) which will aggregate 2.50 lakh farmers across the country. 

• The purpose of aggregation is to integrate primary producers in the value chain and enhance income through increased access to investments, technology and markets. 

• Indian Grameen Services is implementing the project in 15 states (Arunachal Pradesh, Bihar, Chhattisgarh, Goa, Jharkhand, Madhya Pradesh, Maharashtra, Manipur, Meghalaya, Mizoram, Nagaland, Rajasthan, Sikkim, Tripura, and West Bengal) covering 47,175 farmers forming about 50 FPOs.

Farmers’ Producers’ organization (FPO) Formation

Vegetable Growers/pulse growers

Farmers Interest Group (FIG)

Farmers Interest Group (FIG)

Farmers Interest Group (FIG)

Cluster Committee Cluster Committee

BLOCK

FPO

DISTRICT

• One FIG = 10-20 Farmers.• One village = 1- 4 FIG (15 to 60 Farmers)• One FPO = 15-20 Villages (45-60 FIG with 600 to 1200 farmers).

Microfranchising has its roots in traditional franchising, which is the practice of copying a successful business and replicating it at another location by following a consistent set of well-defined processes and procedures. In traditional franchising, the franchisor (who owns the overall rights to the business) sells or licenses its systematized business approach to a franchisee. The franchisor typically controls many of the macro aspects of the business such as creating and marketing the brand, procuring inputs, continuously refining the model, and recruiting and training franchise operators.

Microfranchising is a powerful tool for addressing the challenges of

eradicating poverty and creating jobs in less developed economies. In

essence, microfranchising models work best when they are matched to local needs, when they are simple

enough to be managed without formal business training, and when

they are documented and systematized enough to scale so

that both the microfranchisor and the microfranchisee can profit.

Of the farmers , By the farmers, For the farmersOf the farmers , By the farmers, For the farmers

Green skill based Micro-franchising : An Innovative business model

Micro-Franchise : How it works

• The microfranchisor provides a “turn-key” business for a microfranchisee to operate

• The microfranchises is a set of systems and best practices, that if followed, will help the microfranchisee to be successful

• This is key to the business being easy enough for non-entrepreneurial individuals to be successful

Private and Confidential

Micro Franchise Traits

Private and Confidential

• Local owners in a symbiotic relationship with an enabling institution

• A brand or other significant intellectual property • Mentoring • Shared know-how codified in an operating system • Potential for replication; and • An overt social mission to alleviate poverty

through enterprise

Micro Franchise Model

Private and Confidential

Promoting Livelihoods…Bringing Smiles

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