Why are wood bazaars illicit?

Rampant government corruption and faulty institutions bedevil agroforestry in India

By Ajay Sharma
Published: Wednesday 15 December 2004

Why are wood bazaars illicit?

-- Agroforestry could be a good option to produce raw materials for forest-based industries such as pharmaceuticals, paper and furniture. Besides weaning away pressure from forests, it can provide additional income to farmers and ensure subsistence. However, after years of promotion by the government, agroforestry in India has not lived up to expectations of policy-makers. It caters mainly to the wood market (including the illicit ones) rather than wood-based industries.

Agroforestry is a land use system where trees and/or shrubs are combined with agricultural plants on the same farm. In India, it is usually practiced by medium farmers, who tend to optimise their land use. But the practice does not make much economic sense to a large majority. Small agriculturists are constrained by worries of subsistence, while the larger ones opt for long-term crops such as sugarcane.

And when it's practiced The government's agroforestry promotion programmes have, in fact, been quite lackadaisical. Corruption in government departments has increased problems for planters. It has also resulted in distribution of poor quality plants, poor information systems and restricted technical support for farmers. Local grain markets compound matters by unnecessarily taxing planters for marketing forest products. The police has worsened the situation by extracting bribes from farmers at virtually every check post. Besides, the insurance sector has been quite selective in supporting planters. All this has led to a steady fall in wood prices over the last decade. It is not surprising that farmers are losing interest in agroforestry.

Today, an illicit market in wood thrives in many parts of the country, particularly North India. Brick-kilns in Haryana, khandsari (sugar) units in western Uttar Pradesh (up) and the toy industry in eastern up make their purchases from this market. This illegal market -- which has mastered the guile of securing informal consent of government agencies -- siphons away a planter's produce at hardly 30 per cent of the market price. Even then, the farmer's preference for illicit traders shows how much the system has to improve in order to be effective.

To improve matters Agroforestry can become a viable option. The key is to assure -- possibly demonstrate -- better monetary returns from forest crops through legitimate sources. The infrastructure shall have to change first: research organisations should develop new clones of forest crops, promote region-specific clones and develop tables that help farmers determine the volume of wood in each of the plants -- in absence of such tables, traders easily cheat farmers. Plants should be procured from reliable sources and not seasonal hawkers. It might sound like day dreaming, but corruption in the forest department, among the police and in the grain market has to end.

Grain markets should either facilitate wood marketing or drop unjustified taxes on forestry crops. Creating seasonal and secondary procurement depots for sawmills, wood-based industries and traders can help promote develop agroforestry markets in distant areas. Moreover, the farmers should be equipped with some knowledge about the size of the domestic market. Transparency within government departments and publicising long-term policies as well as yearly targets for export/import of wood would ensure that. The insurance sector also has a vital role: it should issue short-term schemes (3 years) for all planters based on valuation of crops. This will eliminate much farmer reserve against agroforestry.

Farmers should sell their trees to relatively bigger contractors who can fell and move wood in the shortest time. They should accompany the wood up to the weighbridge; this would ensure planters get a fair deal, for wood is usually sold on a weight basis. The wood markets should be legalised. This will enable farmers to deposit their money in banks rather than hoarding it. Institutional and infrastructural changes will make agroforestry commercially attractive.

Ajay Sharma is with the plant science group, Central Queensland University, Rockhampton, Australia 12jav.net12jav.net

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