Employment Strategy for Pondicherry, India


Pondicherry Development Plan for Commercial Agriculture
SUMMARY REPORT
Jan. 14, 1997
Dr. G. Rangaswamy, Project Director
Prepared for the World Academy of Art & Science by
The Mother's Service Society, Pondicherry, India

Pondicherry Development Plan for Commercial Agriculture

 

The Background

1. The main objectives of the Pondicherry development plan for commercial agriculture are to increase production per unit area of land, to generate additional income, and to generate increased employment opportunities in rural areas in order to eliminate unemployment, underemployment and poverty among the people. For the purpose of this study, the Pondicherry and Karaikal regions consisting of more than 90% of the total geographic area of the Territory are taken into consideration. The Mahe and Yanam regions together comprising only 6.6% of the total 486 sq.km, are not covered. Pondicherry and Karaikal regions are compact geographic areas, with the Bay of Bengal as their eastern boundary. Both regions have well developed agricultural lands with different districts of TamilNadu along three other borders. The landspread in both the regions is almost flat, characterised by deep red, alluvial soils of relatively good fertility levels. These lands are considered well suited to one or more agricultural activities in their broad definition. The rainfall of the regions is above average compared to other regions of India. The surface, sub-soil and groundwater resources are considered adequate when used properly for various agricultural programmes. The Union Territory of Pondicherry with about 8 lakhs people is thickly populated at 1,646 persons per sq.km, and is considered to be one of the densest populated areas of India. About 50% of the people live in rural areas, but over 70% of the people depend directly or indirectly on agriculture for their livelihood. Because of the low income from agriculture, more than 30% of the people are living below the poverty line. Unemployment and underemployment are rampant, more so in rural areas. Because of more recent development of industrial activities in the suburbs of Pondicherry town, there is migration of labour to the urban area, which is adding to the already existing problems of urban population explosion. These problems include mushrooming of slums, inadequate basic amenities of shelter, protected drinking water, public health, sanitation, etc. The present problems and those of the immediate future, arising out of the present trend in population dynamics and economy will have to be solved through rapid increase in the average income of the people. Since most people depend on agriculture for their living, the income from the land has to be substantially increased to solve the problems of poverty in the Territory.

2. Both Pondicherry and Karaikal regions are fully developed for human habitation, there being no natural reserve forest. Industrial activity in the Pondicherry region has absorbed a certain percentage of skilled and unskilled labour and to a limited extent technical manpower. Persons engaged in agricultural activities in both the regions seem to be content with average and below average returns. There seems to be no organised collective effort among the people to take to intensive farming practices to achieve maximum, or even optimum, returns from the land holdings, utilizing the available resources of irrigation water and sunlight. As a result, the basic requirements of agricultural produce -- vegetables, fruits, oilseeds, meat, eggs, milk, etc. -- are being brought in from outside. While a few enlightened farmers, especially those governed by the Pondicherry Sri Aurobindo Ashram are engaged in producing a high value crops, eggs and milk products, such activities seem to be exceptional rather than general among the farmers. Also, the trend seen in some advanced agricultural regions of India, of taking to agro-based industries is also lagging behind in both Pondicherry and Karaikal. The only agro-based industries are two sugar mills, one starch factory and a few rice mills. The cotton required for the existing textile mills is brought from outside the region as are also the cereal grains for the flour mill and breweries.

 

Main Approach

3. There is ample scope for intensifying agricultural productivity in both Pondicherry and Karaikal regions.

3.1. The area already covered under irrigated farming for rice and sugarcane should be made more productive through adoption of already available technologies. The governmental measures to transfer the latest technologies should be further intensified. At the same time, farmers' organisations should come to realise the potential and increase the financial, technical and manpower inputs which will raise crop yields and achieve a target of at least an additional 50% yield in the next five years.

3.2. The limited areas under rainfed farming with groundnut, pulses, mango, and casuarina should be brought under intensive farming with high value crops. This would require investments to tap the irrigation potentials, to improve the fertility level of the soil and to adopt high-tech farming practices to achieve maximum returns from the land.

3.3. Wherever there is waterspread such as tanks and ponds as in Karaikal, these rich potentials should be utilised for intensive aquaculture to produce protein-rich fish and bring better returns to the farmers.

3.4. The idle labour force in rural areas, including women, skilled and unskilled youth and under-employed farm labour should be utilised for production of milk and milk products, eggs and broiler chickens for which there is a growing demand within the territory as well as in the neighbouring districts. This requires organised efforts by farmers in clusters of villages to produce the commodities, collect them in bulk quantities and market them with efficiency to obtain best returns.

3.5. A support activity for maximising the income from dairy husbandry, poultry and fishery is the manufacture and supply of the required quantities and qualities of the feeds. This should form an integral part of the commercial agricultural activity. Also, forage crops such as hybrid Napier grass and lucerne should be cultivated and supplied on a daily basis to the dairy farms, both in the rural and suburban areas, which would help substantially in increasing milk production and at the same time reduce the cost of production.

3.6. One of the important inputs in agriculture is quality seeds and there is ample scope for producing and marketing several varieties and hybrids of crop species, especially those of vegetables.

3.7. Another major activity which would extend all around support to the commercial ventures in agriculture in the two regions would be efficient marketing systems which avoid middlemen. The producers of the various agricultural commodities should collectively assemble the produce, and arrange for proper grading, packaging, transport and marketing from the farm gate to consumer markets.

3.8. For the success of most of the projects envisaged, the role of entrepreneurs is very essential in providing the leadership to procure the required inputs, especially finances, and in organising the post-harvest handling, including processing and value-addition.

3.9. Two other projects which are considered highly suited to the environmental and climatic conditions prevailing in Pondicherry region are production of mushroom and orchid cultivation for exports.

 

Identifying Projects

4. In June 1996, detailed studies were undertaken of the agricultural lands of Pondicherry and Karaikal regions with the objective of assessing the production potentials through a commercial approach with the required inputs of technology, finance and management. All the available basic data on agriculture, including annual crops, horticulture, fisheries, dairy and poultry husbandry were collected and studied in detail. Discussions were held with the officials of the government in the related departments, with the senior staff of the Agricultural and Veterinary Colleges and selected farmers of the two regions. Besides, the technical staff under the project visited leading research stations devoted to orchards, vegetable crops, floriculture and animal husbandry in the neighbouring state of TamilNadu. Also, detailed discussions were held with specialists in various fields in the Agricultural College and Research Institute, Madurai, the Horticultural College and Research Institute, Periakulam, several departments of the TamilNadu Agricultural University, Coimbatore and several other centres in the State. Based on the understanding of the potentials in different tracts of Pondicherry and Karaikal regions, several areas of commercial agriculture have been identified which can be exploited through concerted efforts. For these, specific project proposals have been written indicating the physical targets for achievement, the project duration, financial inputs, gross and net returns from the projects as a whole and to individual farmers, employment generation under each project and the overall benefits to the society. During the first phase, these project proposals are expected to take root in about three years. While the projects are under successful implementation, the second phase of development could be formulated taking into account the experience gained during the first phase of implementation, the new, more advanced technologies being continuously developed and the commitment and needs of the community.

5. The following are the project proposals for Pondicherry region, followed by the projects for Karaikal region.

 

Pondicherry Region

5.1. Fruit Production and Processing

5.2. Vegetable Cultivation

5.3. Vegetable Seed Production

5.4. Floriculture

5.5 Orchid Cultivation

5.6. Button Mushroom Cultivation

5.7. Dairy Husbandry

5.8. Forage Cultivation

5.9. Poultry (Broiler) Production

5.10. Animal Feed Manufacture

Karaikal Region

5.11. Cultivation of Medicinal Plants

5.12. Vegetable Cultivation

5.13. Dairy Husbandry

5.14. Forage Cultivation

5.15. Inland Fish Culture

6. A brief summary of the salient features of each of the above 15 project proposals is given below.

6.1. Fruit Production and Processing : Under this project it is proposed to cover 500 ha under fruit trees, i.e., mango 200 ha, sapota 50 ha, guava 50 ha and acid lime 100 ha. The total area may be distributed in several locations, in small and large areas, depending upon land availability, irrigation potential, and willingness of the farmers to join the programme. The details of spacing between the plants, the input cost and the cost of cultivation, average yield, gross returns and net profit are given in Vol.II of the report. The gestation period for fruiting may vary from two to five years and only the optimum yield after full bloom in each plant species is taken into consideration. It has also been estimated that the overall yield of fruits from the five plant species would be around 12,250 tonnes per annum valued at Rs.1,400 lakhs. It is also suggested that the interspace between plants could be planted with vegetable crops for the first two to three years, before the fruit trees cover with canopy. In a two year period, one crop per year of tomato, brinjal, chillies, bhindi and onion could be grown. A total yield of about 5,500 t of vegetables valued at Rs.150 lakhs per annum could be produced, for which an overall expenditure of Rs.80 lakhs is to be incurred. An organisation for marketing of the produce is provided at an overall cost of Rs.34.92 lakhs which will bring an annual return of Rs.28.71 lakhs. One of the major hurdles in development of horticulture, especially fruit crops in the country is the poor price offered to the produce during peak seasons. Being highly perishable, the fruits have to be disposed of, often at throw-away prices, and in the process there is heavy loss due to spoilage. In order to set a model, a fruit processing unit is provided to handle 5 tonnes per day. This would cost Rs.55.00 lakhs and is expected to bring a return of Rs.75.31 lakhs annually.

6.2. Vegetable Cultivation: The project is for cultivation of an area of 1,000 ha spread over the entire Pondicherry region. In all, 14 vegetable species are to be cultivated, most of them as two crops in a year. Total cultivation expenses would be Rs.352.50 lakhs a year with a total yield of 36,490 tonnes valued at Rs.1,033 lakhs. Here again, an organisation for direct marketing of the produce, avoiding middlemen, is suggested. This would cost Rs.43.17 lakhs non-recurring and the net profit per annum would be Rs.101.10 lakhs. This works out to 10% of the total value of the produce, whereas when sold through middlemen, the sale price gets more than doubled that of the farm-gate price.

6.3. Vegetable Seed Production: One of the major hurdles in intensifying vegetable cultivation in the country is the short supply of quality seeds. In order to produce and market quality seeds of some of the major vegetables, this project is proposed. In all, 10 vegetables are to be covered with a total area of about 130 ha, involving about 50-100 farmers. Estimated quantity of seeds to be produced is about 120 t. The seeds have to be produced adopting the best technology and then processed, packed and marketed. The total cost of production is estimated at Rs.46.50 lakhs and sales at Rs.153.25 lakhs with a net profit of Rs.106.75 lakhs.The chief object should be to maintain high quality standards leading to the evolution of a brand name in the market. Over time, the seed production could be expanded several fold and the produce marketed extensively in the country. For example, quality onion seed of certain varieties which come up well in Pondicherry region will be in great demand all over Peninsular India.

6.4. Floriculture : There is a growing demand for fresh cut flowers in the domestic market. Though the demand varies widely from season to season and on different days of the week, there exists a gap between supply and demand. Under the floriculture project seven major flower crops are suggested, indicating the preferred varieties in each. The total to be covered is 100 ha and the cost of cultivation Rs.102.00 lakhs per annum. The produce is to be sold in bulk by weight or by numbers, and the value is estimated at Rs.409.50 lakhs. For adoption of the latest production technology by the farmers, a technical cell is provided. Also a marketing set up with initial non-recurring expenses of Rs.33.78 lakhs and a recurring expense of Rs.16.28 lakhs is provided. For marketing of the flowers, a margin of Rs.2/kg is provided. On this basis, the marketing organisation can make an annual profit of Rs.16.82 lakhs.

6.5. Orchid Cultivation : All over the world, orchids are highly valued ornamentals. They are commercially cultivated in many parts of the world, but are yet to catch on in India. There is a large export market for certain varieties of orchids. The technology for commercial production of orchids is available in India. However, only if bulk quantities are produced could container loads of them be air-lifted and marketed in foreign countries. It is proposed to produce 50 lakhs stalks (or sprays) per year and export. Organisationally, there would be a Main Orchid Centre to propagate the plantlets and also produce in bulk about 30 lakh stalks per year, Another 10 satellite centres would be organised in farmers' fields to produce about 20 lakh stalks, for which the planting material and the technical know-how will be provided by the Main Centre. The flower stalks will be pooled, pre-cooled, packed and exported by the Main Centre. The total area to be covered is 20 ha and 5,000 plants are to be grown per ha. There will be a gestation period of about two years. Total investment in the project is estimated at Rs.328.00 lakhs and working expenses would be about Rs.500.00 lakhs per year. The total gross income from a five year period is estimated at Rs.3,174 lakhs with a net profit of Rs.1,432 lakhs. Since this is a high-tech project, importance is given to technical and managerial training of everyone concerned under the project. Pondicherry region with its prevailing high atmospheric humidity and tropical climate is considered highly suitable for production of certain popular varieties of orchids.

6.6. Button Mushroom Cultivation: Of the various edible mushrooms, button mushrooms are the most popular and their demand is growing steadily. While in Western countries, mushrooms are becoming increasingly popular as a part of the regular diet, their cultivation is decreasing. Therefore, the developing countries are entering into cultivation and export trade of button mushrooms. India is the latest one to join the trade. There are a few large scale button mushroom projects in operation in India. There is scope for several others and Pondicherry could be one centre for bulk production and export. The technical know-how is available in India and the required material inputs can be readily procured in Pondicherry region. Organisationally a central plant would be set up to produce the spawn and to grow a part of the 3,000 t quantity per annum. There would also be 30 satellite mushroom-producing sites distributed within a radius of 50 km. The daily harvests would be collected and processed and packed at the central plant. The main responsibility of the central plant would also include quality control and export of the mushrooms. The total cost of the project is estimated at Rs.3,400.00 lakhs. It is a 100% export-oriented project. The total value of sales is estimated at Rs.480.00 lakhs per year, after a lower sales level in the initial three years. A net profit of about Rs.180.00 lakhs per annual is estimated which is to be proportionately shared with the satellite units. This is a high-tech project and necessary provisions are made for meeting the cost of the technology and for training to improve the efficiency of the management.

6.7. Dairy Husbandry: Considering that there is an ever-growing demand for milk and milk products in the country, dairy husbandry as a commercial venture is highly worthwhile. In Pondicherry region, there exists a gap between supply and demand of milk. Therefore, commercial production of milk under a society organised by the dairy farmers is proposed. The project consists of 200 production centres, each with six high pedigree milch cows. The Jersey cross-breed's daily production of milk under the project would start at about 8,800 litres in the first year and reach 14,795 litres from the fourth year onwards. There will be a central organisation to provide supplies and services to the member dairy farmers. It will also organise pooling of the produce and marketing of the milk in selected centres. The total cost of the project is Rs.180.00 lakhs. Each production centre maintaining six animals will derive a benefit of Rs.1.18 lakhs a year. The marketing wing with a margin of Rs.1/- litre is expected to make a profit of Rs.24.60 lakhs again.

6.8 Forage Cultivation : Supply of green fodder to dairy animals is not a luxury, but a basic need in order to increase milk production. Presently in Pondicherry region, there is no large scale production of green fodder. The staff-fed cattle are dependent on dry fodder of low nutritive value. To compensate for this deficiency, concentrates at high cost are being supplied. It is therefore thought to fit to organise a commercial venture for the production and supply of the highly nutritive Cumbu-Napier grass, Co-3 grass and Lucerne. Co-3 grass is to be cultivated in 60 ha and lucerne in 15 ha so as to supply everyday, all the year around, 50,000 kg of grass and 10,000 kg of lucerne. For this purpose, about 20 farmers owning irrigated land will be enlisted. They will be provided the planting material, the technical know-how and supply of the forage, by an entrepreneur who could be one among them. The entrepreneur will buy the grass at Rs.300/t and lucerne at Rs.400/t and pool them, transport the grass to selected sale points in the urban and suburban areas and sell it at a margin of 25 paise per kg of grass and 25 paise per kg of lucerne. The overall investment by way of cost of cultivation would be Rs.23.70 lakhs with a gross return of Rs.59.55 lakhs. The net profit would be 35.85 lakhs, which works out to Rs.47,800 per ha per year. For the marketing organisation an initial investment of Rs.28.00 lakhs is to be made, followed by working expenses of Rs.24.28 lakhs per year. Through the sale of 18,250 tonnes of grass and 1,200 tonnes of lucerne annually a net profit of Rs.21.35 lakhs can be realised.

6.9. Poultry (Broiler) Production: This project consists of setting up of a Mother Unit to provide the inputs to 60 peripheral units producing the broiler at the rate of 1,000 birds per month from each unit. Places like Villianur may be selected for the Mother Unit. The Mother Unit will have a feed mill, office, godown, transport vehicles, etc. The capital cost for the Mother Unit would be Rs.34.00 lakhs and the operating expenditure Rs.17.44 lakhs. The operating profit would be in the range of Rs.50-60 lakhs. Each of the peripheral units would be set up at a capital cost of Rs.1.80 lakhs and an operating cost of Rs.6.66 lakhs and earn a net profit of about Rs.1.2 lakh per year. The total broiler sales will be about 6.84 lakhs. Adequate provisions would be made for proper housing of the birds, scientific feeding, protection against disease and insurance coverage.

6.10. Animal Feed Manufacture: The cattle and poultry feed for the Pondicherry region is partly produced locally and partly imported from outside the region. In order to fully meet the growing needs of animal feed in the region and the new, intensive dairy and poultry programmes envisaged, an Animal Feed Manufacturing plant is proposed. It will produce both cattle and poultry feeds, for which necessary machinery and accessories are to be installed in a central place in Pondicherry region. The plant will produce 2,400 tonnes of cattle feed and 10,000 tonnes of poultry feed annually, working for 22 days a month and 264 days a year. The capital investment will be Rs.46.20 lakhs and working expenses Rs.81.26 lakhs, and the plant will earn an annual net profit of Rs.341.64 lakhs. The loan from institutional sources could be repaid in 20 quarterly instalments.

Karaikal Region

6.11. Cultivation of Medicinal Plants: Karaikal region is considered highly suited for cultivation of medicinal plants. The available marginal, sub-marginal and cultivable waste lands could be developed and planted with selected medicinal plant species. Based on the available information about market demand for the produce and on the suitability of the agroclimate of the region, seven medicinal plant species have been selected. To begin with about 120 ha can be covered. The technical know-how along with seeds and other inputs will be supplied by an entrepreneur who will also buy the produce, giving a support price for the produce. The total yield of the medicinal plants would be around 60 t per year valued at Rs.42.00 lakhs. This works out to Rs.35,000/ha. Considering that the marginal and submarginal lands are to be put to use, the income is substantial. After the successful operation of the project, the area could be expanded. Also, the medicinal plant species could be changed or substituted as per the market demand.

6.12. Vegetable Cultivation: This project is similar to the one suggested for Pondicherry region, except that the area to be covered is only 100 ha with an average production of 10 t of vegetables per day. The total cost of cultivation is Rs.46.00 lakhs and the value of the produce Rs.115.70 lakhs, giving a net profit of Rs.69.70 lakhs, which works out to an average of Rs.69,200 per ha per year. A marketing organisation to sell 10t of vegetables per day is proposed to be set up with a capital cost of Rs.21.48 lakhs and working expenses of Rs.13.70 lakhs a year. When the marketing organisation is run by the farmers' society with a marginal profit of Rs.0.50/kg it will bring better returns to individual farmers. Alternatively with a margin of Rs.1/per kg of vegetable, the marketing wing can make a profit of Rs.14.20 lakhs a year. Such a wing can be operated by an entrepreneur or one of the vegetable farmers.

6.13. Dairy Husbandry : This project is similar to the one proposed for Pondicherry region, but smaller in size with 50 production units of four cows each. The total capital investment is Rs.237.00 lakhs and returns are Rs.34.50 lakhs, which works out to Rs.78,900 per unit each holding four cows. On an average three cows will be in milk at any one time. The marketing wing will pool the milk from the production centres, transport it and sell it as fresh milk with a margin of Rs.1/litre, giving a net profit of Rs.4.50 lakhs per year.

6.14. Forage Cultivation: This project is similar to the one suggested for Pondicherry region, but will grow Co-3 Napier grass in 20 ha and lucerne in 5 ha to supply about 20,000 kg of grass and 1,200 kg of lucerne per day. The total investment will be Rs.6.00 lakhs for grass and Rs.1.5 lakh for lucerne. The annual return would be about Rs.45,000/ha. The marketing wing will invest Rs.12.50 lakhs as capital expenditure and will spend a recurring expense of Rs.11.58 lakhs. By sale of grass with a margin of 20 paise per kg and lucerne with a margin of 25 paise per kg, a net profit of about Rs.1.42 lakhs can be realised. When the demand increases, production could also increase, with enrolment of more members.

6.15. Inland Fish Culture: With the availability of extensive areas of stagnant waterspread, intensive inland aquaculture is possible in Karaikal region. The present project is formulated with the objective of producing 2,000 t of quality table fish per year. The project will cover an area of 100 ha of waterspread and will culture multiple species of fresh water fish taking one crop in the main season. It will have a Fish Hatchery, Growout Ponds, Fish Feed Mill and roomut Rs.iation an integrTo cng plants. The total capital coum would be R,391s.6.00 lakha with annund working expenses of R,029.47.64 lakhs. Tal gross incoum would be R,50s.34.00 lakhs ame fro, all tng fong wales will be aboto RsRs.3.00 lakh, after a gestation period st two to three ye3.8. For the success of the projeco, all tng fong walct shound wkha wier fucoordlimiregion. THuskThe lakhs can repaback is seiresentnd within ton mi possibon period n, sevve years.

 

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