Secretive. Exploitative. Is the market in Minor Forest Produce unmanageable? sopan joshi finds out
• India has 16,000 recorded plant species. About 3,000 of these yield minor forest produce (MFP).
• Nearly 500 million people living in and around forests in India depend on MFP for sustenance and as a supplement to their income
• Studies in Orissa, Madhya Pradesh, Himachal Pradesh and Bihar indicate that over 80 per cent of forest dwellers depend entirely on MFP; 17 per cent of landless people depend on the daily wage labour of collecting MFP; and 39 per cent of people are involved in MFP collection as a subsidiary occupation
• MFP-based small-scale enterprises provide up to 50 per cent of income for 20-30 per cent of the rural labour force in India
• 55 per cent of employment in the forestry sector is attributed to the MFP sub-sector
• Over 50 per cent of the revenues earned by the forest department comes from MFP. Growth of revenues from MFP have generally been 40 per cent higher than timber
• The share of total export earnings from MFP ranges from 56.5 per cent to 75 per cent of the total exports of forest produce including timber
The MFP market is a mystery
Forest produce 'value addition' -- perhaps a factory of ayurvedic drugs in Ghaziabad that needs aonla or a tannery in Kanpur that uses harra seeds to cure leather -- occurs through a complex web of collectors/gatherers, retailers, wholesalers, exporters, suppliers and commission agents.
The people who roam the forest to collect mfp are the most neglected hub in the web -- they live in poorly connected villages close to the forest. They can get income from the mfp market, huge even by conservative estimates. "But this market is unorganised and very secretive," says Arvind Boaz, a forest officer in Chhattisgarh. If you ask a person gathering the seeds of, say, sal in the forest, it is very unlikely that s/he would know it is used as emulsifier in chocolates. Unaware of the commercial worth of what they collect, they sell it for a pittance -- desperate for whatever little they can get, lacking the means to go and find a more lucrative market. Moreover, because they sell in small quantities, they never get a good price.
Traders and manufacturers, on the other hand, are mostly unaware of the forest from where their stock comes. In fact, a lot of what is sold in the market is illegal. "A Mumbai company sent us its brochure and offered to buy any mfp or mfp technology that we might have to offer," says P P Bhojvaid, head of the non-wood forest product division of the Forest Research Institute (fri), Dehradun. "I checked the mfp mentioned in the brochure; 18 of the 20 names were included in the Red Data Book of the World Conservation Union."
The market being so cloudy, information is at a premium -- current rates in local and national markets; stocks of a particular tuber or seed available in a particular area; the quality of stock in a particular season; which area produces good quality leaves of a particular plant. Such information is crucial; mfp yield is extremely variable -- the forest is not a cultivated field. Says N C Saxena, former secretary to the Planning Commission: "If agricultural production varies by 25 per cent, production of mfp can vary by more than 100 per cent for some forest produce." The yield of sal seeds can vary by four times from one year to the next, says A K Singh, executive director of the mfp Federation of Chhattisgarh. This varying demand means people who have the capacity to stock and wait for the right time and price -- traders -- rule the roost. Their grip begins in the weekly markets (haats).
The tribal-dominated Bastar district in Chhattisgarh is one of the richest areas for mfp. Haats are held in all major villages. If you land up on haat day, you will see tribals walking to the haat from all directions, carrying fresh collections in small sacks. Near the haat stand middle-aged men next to a cloth spread out on the ground, on which are neat mounds -- seeds of harra, cocoons that yield the famous kosa silk of Bastar, or beeswax used to make bell metal figurines. These men are kochiyas (middlemen), the agents of the traders.
The kochiyas speak the language of the tribals and in many cases shell out loans as advance payment for mfp. They hustle the tribals, cheating them on weights and rates -- tribals mostly count in traditional scales and are unfamiliar with the metric measure. The tribals have to sell; they need the money to buy weekly supplies.
What the kochiya cheats is what he earns. He sells his proceeds to the local trader, who typically belongs to communities prominent in commerce. If a particular mfp is used locally, this trader stocks it till the price rises in the off-season. For example, they buy mahua flowers (used to make the famous mahua liquor) during spring for Rs 5 per kg from the tribals and sell it back to them in winter for Rs 10 per kg. In the case of produce that goes out of the regional market, they act as wholesale suppliers to stockists and commission agents in towns and cities. They are also the ones who can 'manage' a transport permit from the forest department, making them invaluable. Traders in big cities do not have the local presence to obtain these permits, but they are the ones who are connected across the country.
Dhamtari, 70 km south of Chhattisgarh's capital Raipur, is arguably India's biggest mfp market, especially when it comes to medicinal herbs, which Boaz says comprises an estimated 75 per cent of the mfp trade. Station Road in Dhamtari is the hub of the medicinal plant trade, and there are several shops in a small area, including that of Satyanarayan Rathi, reputed to be the biggest trader of medicinal herbs.
Other important trade centres include Jagdalpur in Bastar, Katni in Madhya Pradesh, Saharanpur in Uttar Pradesh (which handles supplies from the forest-rich state Uttaranchal), and Khari Baoli in Old Delhi's Chandni Chowk. A bulk of the export market is handled from Mumbai. But the traders in these places guard all information like their life depends on it. They operate from small shops that are front offices -- the godowns are hidden from the public eye. These wholesalers have the pulse of the national market and have contacts in the industries that use mfp. They operate on small margins in price, and they make their money by selling in bulk. But why do manufacturers play into the hands of these traders? Why don't they buy from the collectors and growers?
"I have had herb growers and mfp collectors come to me and offer to sell me good quality herbs," says Paranjay Sharma, president of Baidyanath, one of India's largest Ayurvedic drug manufacturers. "They want the same rates as the traders, and they want down payment. Why should I jeopardise my relationship with the traders who supply on credit? Large companies typically pay 45 days after delivery -- that, too, after quality checks and rejection of low-grade supplies. Besides, the trader supplies as and when I get orders from the distributors. The growers can't provide any of these services."
Sharma is worried about Ayurvedic medicines losing popularity: "Most manufacturers have recorded a dip in the sales of Ayurvedic drugs in the past year or two. The rise is in herbal cosmetics, and everybody knows most of these products are herbal only for name's sake." Rajiv Maheshwari, one of the largest herb traders in Delhi's Khari Baoli, says the market for herbal products is very fickle and depends mainly on advertisements: "Most of the herbs sold here are to make so-called aphrodisiacs and tonics like chyavanprash."
Business insiders say that the real potential lies in exports. "But there are 15 'alternative' systems of medicine that record exports higher than those of Ayurved. The Chinese government protects its herbal exporters the way the us protects its oil interests in the Gulf. The Indian governments organises seminars and asks traders and manufacturers to give fair prices to the collectors," says Sharma.
The regulations regarding mfp export are not very clear. According to the Union ministry of environment and forests, the Ex-Im Policy prohibits export of mfp in the form of raw materials (seeds, roots, leaves, barks and stems). But the National Medicinal Plants Board (under the Union ministry of health and family welfare's department of Indian systems of medicine), offers a conflicting view: India is losing millions in forex because it exports only raw materials. Export of value-added products is difficult as most industrialised countries require certification of 'good sourcing practices' to ensure the quality of the products and that it has been harvested sustainably. As yet, there is no certification authority. " mfp is one of the most secretive part of India's export sector," says M P Shiva of the Centre for mfp, a non-governmental organisation in Dehradun, which has done a yeoman's service in documenting information on mfp.
One thing however is very clear, however -- all these uncertainties make sure that the collectors of mfp can never get a fair deal. Governments haven't been totally blind to this. Beginning in the 1960s, several efforts have been made to regulate and nationalise at least some important items to ensure steady income to mfp collectors and take the mfp market out of the clutches of private operators. A few of these efforts attained some success, but mostly it is a tale of failures.