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accept ‘JLGs within the SHGs’ in a positive way without
internal conflict. Bankers also point to a lot of overlap
between lending to SHGs and JLGs especially in the
southern states, where numbers are high both for SHGs
and JLGs, which is leading to multiple lending.
4.6.2 SHG-Based Livelihood Interventions
NABARD has supported various types of interventions
in livelihoods over the years. These include support for
watershed development as a comprehensive livelihoods
approach, the WADI programme for tribal livelihoods,
promotion and financing of producer organizations,
support for rural entrepreneurship and skills and the
development of local craft and rural industry clusters.
These types of interventions have generally involved
the efforts multiple agencies that go beyond the narrow
provision of loans. At the SHG level, the initiative of
SHPIs and the SHGs members themselves had enabled
lasting increases in income and quality of life. Box 4.2
provides a case of a dairy value chain facilitated by
Hand in Hand, a leading SHG promoter in Tamil Nadu
and other states, along with support from a NABARD
subsidiary.
Following the massive expansion of the SHG pro-
gramme, the graduation of SHGs members to viable
livelihoods is seen as a natural corollary—along the lines
of the approach adopted by the NRLM. This transcends
a narrow financing approach to a structured development
plan involving a range of support institutions. NABARD
B
OX
4.2
SHG-based Dairy Value Chain of Hand in Hand India
Many of the SHG women involved in the dairying face exploitation by middle men in the sale of the milk produced. These dairy
entrepreneurs face lack of capital to procure animals, low milk prices, and absence of support services. In August 2012, Agricultural
Development Finance Tamil Nadu (ADFT), NABARD provided finance of Rs. 10 million to Hand in Hand for on-lending to 92
Activity Based Groups (ABGs) for dairying. The project created visible impact on of SHG members. In the second phase, ADFT
extended further support of Rs. 1.86 million to 42 ABGs and Pallavan Grama Bank also sanctioned dairying loans of Rs. 5.9
million through 55 SHGs. The credit facilitated procurement of 1257 cross bred cows.
Hand in Hand India has planned a dedicated value chain to promote dairying as a remunerative enterprise by facilitating
financial linkages, increasing income through bulk procurement of inputs and collective sales of milk and providing other
necessary support services. It started Melmalayanoor ‘dairy hub’ in October 2013 as a separate Mutual Benefit Trust to deliver
these missing links and to offer value added services to the SHG members involved in dairying. Two others are presently at the
start-up stage.
These hubs are like training cum production centres, but managed by the entrepreneurs themselves. The hubs obtain contracts,
undertake quality control, skill training, provide or procure inputs, veterinary care and insurance, packaging and branding,
collaborate with government agencies and ensure fair and ethical trade practices. Individual entrepreneurs will reap the benefit on
the basis of their contribution to the production. Each hub is expected to serve around 250 women at the outset.
There are seven Satellite Milk Collection Centres (SMCC) under the three dairy hubs. Each SMCC is managed by a SHG
member. SHG members obtain sale proceeds of milk once in 10 days through the SMCC. The hub supplies milk to three private
milk-processing units and realizes a price of Rs. 23 to Rs. 25 a litre of milk. The hub is provided with a freezer, cream separator
and milk-testing facilities. The dairy hubs also took up the preparation of value added products like curd, buttermilk, rose milk
and badam kheer. They have also enabled more than 200 SHG women raise the fodder on their farms. Technical Assistance and
backstopping support is provided by Hand in Hand.
SHG women now obtain a price of Rs.21 to Rs.23 per litre of milk compared to Rs. 13 to 15 per litre in the pre-project period.
Hand in Hand is planning to scale up by merging all the three dairy hubs into a producers’ company towards building social
business institutions and increase milk production to 10,000 litres per day.
Melmalayanoor dairy hub has crossed break-even level and is recording sales of around 1500 litres of milk per day and a
turnover of more than Rs. 1 million per month. It covers a part of the staff cost as the salary of veterinary doctor, accountant,
mobilizer and logistics staff. However, challenges remain, including the mobilizing of SHG/ABG members to take responsibility
for dairy hub operations.
Source
:
Adapted from Hand in Hand (2014) and discussions with N. Jeyaseelan, Hand in Hand India
.
