Dairy as engine for economic growth
A large part of India’s rural population lives below the poverty line. Women in particular fare badly, as they are dependent on their husbands and are forced to wait and see how much of his income is left for household expenses. Women in the state of Andhra Pradesh have sought to change that, in 1993 organising in self-help groups. That has since resulted in the setting up of the Intivelugu Mahila dairy cooperative (IMD).
Setting up self-help groups at local level is an important first step on the road to greater self-reliance for women. The members of these solidarity groups save together and extend credit to one another from the accumulated funds. Mutual trust and cooperation constitute the foundation for further growth. In 2000 these small village self-help groups amalgamated in Mutually Aided Cooperative Thrift and Credit Societies, or so-called MACS. These small-scale savings and credit cooperatives gave the women access to better savings and loans opportunities. To attract outside capital as well, the MACS set up the Indur Intideepam Producers’ MACS Federation (IIMF) in 2002. IIMF not only puts up loan capital but also takes responsibility for marketing and the provision of seed, fertilizer and pesticides. But unfortunately farming fails to offer smallholders a stable source of income due to fluctuating prices and the low rates paid by the brokers. To counter this, the federation set up the dairy producer cooperative Intivelugu Mahila Dairy (IMD) in 2005 to provide a steady additional income stream from buffalo milk. IMD opted for buffaloes because they produce five to ten litres of milk daily, more than the 3,5 to 5 litres which constitute a cow’s daily yield. What’s more, by buying a better breed of buffalo the women are in a position to boost production.
Credit to buy buffalo
Rabobank Foundation initially gave the IMD dairy cooperative a donation to improve milk quality and to strengthen the organisation. As a result milk prices have risen by 20%. To encourage further growth and increase capacity, the cooperative needs additional credit to buy livestock. Rabobank Foundation is not in a position to extend loans directly to organisations in India, but in order to meet IMD’s need for access to new financing the Foundation is working together with one of Rabobank’s customers and partners. Maanaveeya Development & Finance Private Unlimited is a financial organisation in India and an Oikocredit subsidiary. By extending a guarantee to Maanaveeya, the Foundation has ensured that Maanaveeya has sufficient security to extend a loan to IIMF/IMD. The loan will be used to issue microcredit to around 1000 dairy farmers so that they can buy buffaloes. IMD will repay the loan to IIMF on supplying the milk.
Women like Karnolia Sujatha (pictured) from Kamalapur were sometimes already milk producers prior to the setting up of IMD, but the middlemen buying up the milk didn’t come every day and paid less. Nowadays Karnolia takes her milk twice daily to the local collection point. She and her fellow farmers are taught how they can raise the fat content of their milk, as a result of which it fetches a better price. The training courses they attend are funded by Rabobank Foundation. Better animal feed helps improve the quality of the milk and Karnolia grows the special grass she feeds her livestock herself. As a leader of one of the MACS self-help groups she has gained in self-confidence. Her dream is to build a bigger house and to ensure that her children get a good education so that later they have the chance of landing a well-paid job.