access
Development Services




                       Prospects for Setting up of

                Rural Business Hubs
  ...
AboutACCESS
 About ACCESS


             ACCESS is a global partner of choice providing inclusive and
             innovat...
Program Units



Microfinance
                                                 Livelihoods

    Microfinance Technical    ...
The NorthEast Study - Methodology

   Secondary data collection / background research on production,
   stakeholders, valu...
Highlights


  Though the NE region has a high potential for development of
  horticultural crops, cash crops, spices, liv...
Highlights


  Identified four potential commodities for immediate setting up of
  RBH in Northeast: Ginger ,Turmeric, Pas...
Key Stakeholders for setting up
Rural Business Hubs


        AMFU , Mizoram

        IFAD

        FARMGATES : Assam and ...
Commodity-wise potential locations for
  Rural Business Hubs
 Pineapple
Region                   Production    Potential b...
Commodity-wise potential locations for
 Rural Business Hubs
 Passion Fruit
Region               Production         Potenti...
Commodity-wise potential locations for
   Rural Business Hubs


 Ginger
Region           Production      Potential buyers ...
Traditional Value chains


                                                                     National
                 ...
Value chains under RBH

                       National wholesale
                            markets
                    ...
Benefits of a Rural Business Hub

                    2                                        4
1                        ...
Role of a Rural Business Hub

                           Markets
                                                         ...
The ACCESS Livelihoods framework


                    INCLUSIVE VALUE CHAINS
Sub-Sectors



    Clusters
                ...
Delivering Sustainable Services
       A seven-step / four-year sustainable strategy
            Sub -sector              ...
Investments Required for incubation of Rural
Business Hubs

       Organizing Primary Producers

       Aggregation points...
Current constraints to setting up of Rural Business
Hubs
  Lack of funds for setting up processing units in the region
  F...
Potential for corporate intervention

  Setting up of 3-4 strategic fruit collection points to facilitate aggregation
  Cr...
Recommendations for setting up Rural Business
Hubs
   Need for a Resource Agency to bring convergence and coordination
   ...
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Access Development Services

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Access Development Services

  1. 1. access Development Services Prospects for Setting up of Rural Business Hubs in the North East A feasibility study
  2. 2. AboutACCESS About ACCESS ACCESS is a global partner of choice providing inclusive and innovative livelihood solutions enabling the poor to The Vision overcome poverty and live with dignity To build the capacity of community-based institutions that Mission deliver relevant financial and livelihood development Statement services to the poor and unreached households Ability to work at scale To invest in community based institutions & models Focused on women’s empowerment Builds inclusive value chains in favour of the primary producer The USP Builds local capacities of capacity builders / NGO partners Strong market focus Develops “lift and shift” models for replication of experiences Incubator of innovations Strives to achieve double bottom line impact
  3. 3. Program Units Microfinance Livelihoods Microfinance Technical Non Farm Sector Services Farm Sector Livelihoods Innovations Virgin Investment EARTH Fund Livelihoods ACCESS Innovation Microfinance Initiatives Alliance
  4. 4. The NorthEast Study - Methodology Secondary data collection / background research on production, stakeholders, value chains Mapping the potential for four agricultural commodities based Rural Business Hubs in the north-east Undertaking Diagnostic study : field visit, situational analysis, assessing market demand, availability of infrastructure and identifying the stakeholders in the value chain (public and private). Identifying key constraints for each commodity at each level of the value chain. Administration of questionnaires, checklists and structured interviews for stakeholders at different levels Participatory analysis on field Compilation and analysis of the researched data for RBH feasibility Analyzing data and preparing an action plan
  5. 5. Highlights Though the NE region has a high potential for development of horticultural crops, cash crops, spices, livestock, fishery etc., efforts have not been made to develop these sectors on a commercial basis Lack of an effective coordination mechanism to highlight and optimize the potential Poor cultivation practices and lack of desirable planting material hampering productivity Lack of dedicated infrastructure for processing / value addition Lack of market facilities Scarcity of trained manpower and extension support Lack of financial linkages Lack of funds for value added products and marketing components Need for flexibility in state level schemes for the benefit of farmers
  6. 6. Highlights Identified four potential commodities for immediate setting up of RBH in Northeast: Ginger ,Turmeric, Passion fruit and Pineapple) Intensive pineapple cultivation is present in Cachar (297 farmers) and Vairengte (500,000 farmers) There are 542 farmers involved in passion fruit cultivation on 2,232 acres of land in 37 villages in and around the Churachandpur town in Manipur No Single window mechanism for coordination with multiple departments in the NER. No takers for Horticulture Transport Assistance Scheme introduced in 2001, in spite of modifications in the scheme?
  7. 7. Key Stakeholders for setting up Rural Business Hubs AMFU , Mizoram IFAD FARMGATES : Assam and other states of Northeast NERAMAC : Tripura ,Assam ,Meghalaya APEDA: All States in the Northeast Calypso Foods Futures Group
  8. 8. Commodity-wise potential locations for Rural Business Hubs Pineapple Region Production Potential buyers / stakeholders Assam: 240,990MT Arren Foods Pvt Ltd Jorhat , Karbi Anglong OMFED & North Cachar Hills NERAMAC Meghalaya : 7,000 MT Farmgate Alliance, Ri Bhoi, East Khasi NERAMAC Hills, Garo Hills, Umsing, Nangpo Manipur 70,000 MT Calypso Group Future Group Tripura 115,829 MT NERAMAC Kumarghat Piyush Agro Ltd Longtari Mizoram 7,000 MT NERAMAC & OMFED
  9. 9. Commodity-wise potential locations for Rural Business Hubs Passion Fruit Region Production Potential buyers / stakeholders Manipur 1,500MT Calypso Foods Tribal Areas along (Manipur) Future Group Barak River 4,800 MT Churachandpur (entire NER) Turmeric Assam 20,360 MT ITC, Reliance Fresh, Azadpur Karbi Anlong (Mizoram, Assam, Mandi, Delhi, Sabka Bazaar, Meghalaya) Subhiksha Mizoram Mamit District Rengdil Tukkaiah, Phaileng Lailen, Khangumum
  10. 10. Commodity-wise potential locations for Rural Business Hubs Ginger Region Production Potential buyers / stakeholders Halflong 138,370 MT Dabur, ITC, Reliance Fresh, NC Hills (entire NER) MDH, Ashok Masala, Tata Tea, Barni Haat Piyush Agro Ltd.
  11. 11. Traditional Value chains National wholesale markets Consumer Local retail Markets: Packaging / small shopkeepers branding Retail Markets: small shopkeepers Processing: small Wholesale Markets: traders Large processing scale processing units houses Transportation: Middlemen Commodity Aggregation : Middlemen Cluster Production : Primary producers
  12. 12. Value chains under RBH National wholesale markets Exports Retail Markets Transportation Packaging / o Credit branding o Inputs supply o Technology Processing: primary Processing: corporate o Information producer cooperatives sector o Benefits from Govt. Aggregation : primary Rural programs producer cooperatives Business Hub Production : Primary producers
  13. 13. Benefits of a Rural Business Hub 2 4 1 3 Economic Social Commercial Environmental Benefits Benefits Benefits Benefits 1. Sharing & 1. Employment 1. Enhanced 1. Aids in Pooling of generation chances of decongesting resources securing units from 2. Compliance larger urban areas 2. Sharing to trade contracts Business related 2. Ensures that Development barriers 2. Greater environment & Operating bargaining al safety 3. Ensures Costs power with standards enhanced markets are 3. Access to security maintained New during the 3. Effective Technology start up presence in 3. Various phase the market forms of 4. Value place pollution addition always under within the 4. Attracts check region corporate interest / investment
  14. 14. Role of a Rural Business Hub Markets Private investments Sector Government Programs / entitlements processing PRIs information RURAL BUSINESS HUB Technology seeds Enhanced Input Fertilizers / productivity suppliers pesticides Technical Service aggregation credit Providers Primary Producers
  15. 15. The ACCESS Livelihoods framework INCLUSIVE VALUE CHAINS Sub-Sectors Clusters Dissemination SPARC Replication Producer Upscaling Company
  16. 16. Delivering Sustainable Services A seven-step / four-year sustainable strategy Sub -sector Integrating Identify Achieve Identify Set Up Establish analysis the value potential Sustain- potential the the chain clusters ability sub SPARC Producer sectors Co. undertake Environ- A technical Identify help to Based on those cluster ment, support primary develop a the value that diagnostic infrastru- team to producers business of relate studies cture handhold within the plans, link services, closely compara- the cluster, with input SPARC to the tive & producer organize suppliers, will evolve liveli- competitive Co., them into credit as a fee- hoods of advantage, provide producer agencies, for- the poor status, technical co., help TSPs, service TSPs, support to set up the promoters, model to future the cluster, govern- with their provide potential, enable ance and entitlement long term gaps & replication manage- s and with support strategies ment markets the cluster
  17. 17. Investments Required for incubation of Rural Business Hubs Organizing Primary Producers Aggregation points First level Value addition centers Cold storage and warehousing facilities Refrigerated vans Processing centers (Suitable to the location) Packaging / branding Quality material enhancement Market tie ups and brand building
  18. 18. Current constraints to setting up of Rural Business Hubs Lack of funds for setting up processing units in the region Financial constrains for development of a holistic project based on a value chain analysis Scarcity of trained manpower and extension support service provider Lack of a facilitators for aggregating all the schemes and potential stakeholders into one common interest of an RBH Lack of awareness and infrastructure in all the States resulting in a very poor response from exporters/farmers to take up new ventures. Cross boarder transportation issues Remoteness of the region
  19. 19. Potential for corporate intervention Setting up of 3-4 strategic fruit collection points to facilitate aggregation Creation of a market yard for sale of raw fruits in the local market Setting up of a Rolling Fund to pay farmers as and when they bring their produce to the collection point. Currently, the Society’s pays the farmers only after it receives payment from the factory. Setting up of a processing unit in the production area is an essential need – be it for passion fruit, honey or aromatic and medicinal plants -- due to the persistent law and order situation in the state that prevents movement of perishable fruits at times. Need felt for technical guidance in establishing the processing unit and incorporating production techniques such as marketing of produce in various forms like raw, juice/squash, jelly, jam, pickles, etc.
  20. 20. Recommendations for setting up Rural Business Hubs Need for a Resource Agency to bring convergence and coordination among stakeholders Assign start up funds through on-going programs of the Government (SGSY, Backward regions, cluster development) Need for organizing primary producers / processing coops Develop a bankable Business Plan for the Rural Business Hub Secure credit linkages Attract private capital for setting up of dedicated infrastructure for value addition / processing Establish sustainable market linkages Investments in brand building of the RBH region / as also of the commodity

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