The sweet scent of hard cash
FLOWERS have traditionally been used to display humane emotions. Of late, however, they have become a symbol of profit. Dutch floriculture firms and Indian entrepreneurs are joining hands to cultivate exotic varieties of roses, lilies and gladioli. However, there are fears that the deals may have adverse environmental consequences.
Earlier this year, a Dutch mission consisting of representatives from 13 major floriculture companies visited India, looking for suppliers of large quantities of exotic species round the year. Since the visit, commitments worth Rs 84 crore have been signed. Among the tie-ups were a Rs 14-crore collaboration between the Delhi-based Kanoria Chemicals and Industries Ltd and the Dutch consortium Flamingo International for growing special varieties of flowers, including tulips, in Himachal Pradesh; a Rs 12-crore venture between the Gurgaon-based Vishwa Flora Ltd and Moerheim Roses and Trading for growing roses, and a Rs 8.2-crore project for growing roses between the Pune-based Deccan Florabase Ltd and Flodac.
Indian agro-industrialists admit they find export-oriented floriculture far more profitable than eucalyptus plantations or extensive cultivation of oilseeds. Typical of the tie-ups reached with the Dutch firms is the Vishwa Flora project. Says the spokesperson of Vishwa Flora, which is to send its first consignment in November, "As part of our collaboration, we are receiving state-of-the-art planting material as well as greenhouse technologies."
Senior managers of the Indian firms contend their profit margins can be guaranteed only through imported technologies. They feel that traditional or indigenous varieties cannot match the quality of the international market, which demands uniformity of shape, size and colour in the blooms. Says the Vishwa Flora spokesperson, "International standards can be met only by growing flowers in controlled conditions, as in a greenhouse." The most obvious advantage, according to him, is the unprecedented yields. India's annual yield of traditional rose varieties is estimated at about 800,000 flowers per ha, but imported seeds and saplings cultivated under greenhouse conditions are guaranteed to yield almost 5 million roses per ha in the same time span.
The monetary difference is equally stark. Traditional flowers in India yield average annual returns of about Rs 70,000 per ha, whereas the exotic varieties promise at least 8 times more. Vishwa Flora officials admitted that for inputs worth Rs 90 lakh per ha per year, they expect to earn Rs 825.31 lakh annually from exports. In comparison, the projected Rs 5.60 lakh from total domestic sales seems like small change.
Little wonder then that Indo-Dutch floricultural tie-ups have mushroomed. Says A K Gupta, general manager of the Union commerce ministry's Agricultural Products Exports Development Agency (APEDA), "We have issued licences to nearly 40 fully export-oriented horticulture units, with the majority of them supplying to Dutch firms." Other APEDA officials reveal that nearly 75 applications are pending. They estimate that since 1992, nearly 155,000 ha of agricultural land has been dedicated to export-oriented cultivation of exotic varieties of flowers, meant primarily for Dutch traders.
Flowers are a high income source for many Dutch firms, which control about 65 per cent of the $5.5-billion annual international trade. Till 1992, India's share in the international trade in flowers was a meagre Rs 12 crore ($4 million). But in the wake of the recent spate of Indo-Dutch agreements, the commerce ministry estimates this will increase almost 20-fold by 1996-97.
The Dutch looked to India for both economic and environmental reasons. Says Yogesh Agrawal, managing director of Tushar Agri-Business Consortium (India) Ltd in Gurgaon, Haryana, "Flower growing firms in Holland have to pay nearly $50 per day to their farm workers. They realise that with a little bit of investment in training, our workers can provide the same services for the equivalent of just $5-10." Labour wages account for up to 60 per cent of the cost of commercial flower cultivation in Holland. In addition, the prices in India of other inputs such as fertilisers, pesticides and greenhouse operations are much lower. The result is that flower bulbs in India cost only about 20 per cent of those in Holland.
Moreover, the tie-ups with India are part of a decade-long effort by Dutch companies to find warmer climates for cultivation. As an Indian representative of an Amsterdam floricultural firm says, "The peak demand for flowers in the European and American markets is in autumn and winter, when temperatures there are too low for large-scale flower cultivation." Most of the export-oriented floriculture units in India, which were established during the past 2 years, are located around Pune and Nasik in Maharashtra and Bangalore in Karnataka, where the climate is moderate throughout the year.
Recently, the Indian government took several measures to promote the Indian tie-ups for international horticultural firms. These include duty exemption for imports of planting materials, a reduction of export duties on bulbs and cut flowers from 55 per cent to 10 per cent and lowering of import duties on materials for greenhouses and refrigerated transport vehicles from 200 per cent to 75 per cent. Plant quarantine laws have been relaxed as well.
However, critics warn that untrammeled enthusiasm for floriculture will have high ecological costs. Imported plants use almost 12 times as much fertilisers and insecticides as traditional Indian varieties do. Every ha of imported gladioli has to be fed with 12 tonnes of inorganic chemicals per year. Water requirements are even higher. Most export-oriented floriculture farms in Nasik will consume 80,000 litres per ha daily. According to D K Uppal, executive director of the National Horticulture Board in Gurgaon, "The high-tech methods of growing flowers premise their fantastic yields on such intensive inputs of nutrients."
Says N K Dadlani, deputy commissioner in the horticulture wing of the Union agriculture ministry, "Indian growers must not repeat the mistakes of the West, where cases of groundwater and soil contaminated by inorganic chemicals used for extensive floriculture became quite common." He points out that the problem is especially severe when the chemical-saturated soils of greenhouses have to be leached out.
Most floriculture firms feign ignorance on this point, though some are aware that the problem may snowball into a major issue. Ahmad Shah, who grows gladioli and chrysanthemums on his 6-ha Haji Flora Farms in Nasik, admits that he was told by his foreign trading partners of the longstanding campaign run by the Environment Federation of South Holland against soil contamination and degradation caused by floriculture. Though he admitted that floriculture farms in his area have dumped greenhouse sludge on common lands, creating problems with villagers, he said "it is not too major an issue yet."
Experts also warn that lax quarantine laws might result in the spread of exotic plant diseases. Besides, Kavita Mehra of the National Institute of Science, Technology and Development Studies in Delhi opines, "There should be a system for incorporating indigenous technology or else our r&d efforts in the field will be wiped out." Officials and scientists of the horticulture board concur.
This contention is rejected by floriculture firms with equal vigour. "Horticultural research in India has not yet come out of the laboratory and cannot match the products offered by the foreign firms," Agrawal says.
Indian experts point out that the aims of indigenous floriculture research have been entirely different from those of the export-oriented agro-industries. Dadlani points out that the flower varieties developed in the national laboratories tried to cater to the domestic market "and hence the difference in the products we have to offer". He explains that the domestic demand for flowers is mainly for religious purposes or for making garlands. Thus, flowers with small stems and a strong fragrance were developed.
The exporters are unimpressed. Clearly, they feel that the sweet smell of roses can be enhanced by increased profits.