South Asia

IFC Farm Forest Initiative Partners Clients and Farmers for Sustainable Business

April 11, 2012 -- IFC, DEG, and existing investment clients from the paper and pulp industry launched a pilot farm forestry advisory program in South Asia that will reach 5,000 farmers in the near-term, improving their incomes, strengthening community-based organizations, and developing partnerships between paper manufacturers and suppliers. The plan is to create a successful program that can eventually be scaled up to reach nearly 50,000 farmers.

At a recent consultation workshop, IFC’s Sustainable Business Advisory team engaged with farmers and representatives of Indian paper and pulp company, JK Paper, on a common platform to jointly develop strategies to improve productivity and revenues.

Lack of relationships between small farmers, companies and banks; unproductive use of land by small holders due to lack of information and knowledge all prevent optimal productivity and make developing reliable and sustainable supply of raw materials a challenge for pulp and paper companies.

Roads to Growth

“The discussions at the two-day workshop give us hope that it is possible to scale up plantations in a sustainable manner,” said JK Paper’s Executive Vice President and plant head M. C. Goel.

At the workshop, IFC and participants collaborated to
 

• help paper companies align in-house activities in securing sustainable supply of wood,
• present innovative rural communication tools to support outreach to farmers, such as audio-visual films, graphic how-to manuals, interactive learning exercises, etc
• leverage local partnerships to achieve scale in farm forestry,
• share international best practices in community engagement.

Workshop participant and farmer Gragadhav Sahumi said, “Growing plantations is good way for a farmer to protect land from theft. It generates an alternative source of income for us.” Sahumi, hailing from Rayagadha district of Odisha supplies wood to JK Paper’s mill in the district.

Meeting Demand

As India’s economy continues to grow, demand for paper, cardboard and packaging materials is projected to increase by 26 percent from 8.7 to 11.7 million tons (2011-12) according to global research and analytics company CRISIL. Companies in India rely on farmers to grow trees and supply raw materials for their paper mills.

JK Paper now plans to implement an action plan to double raw material availability with IFC's support. The plan includes continuing the dialogue and managing project risks by strengthening relationships with farmers using innovative extension and communication techniques while building and leveraging local partnerships.

JK Paper approached IFC Advisory Services based on its institutional experience in developing sustainable relationships between manufacturers and suppliers, strengthening community based organizations and increasing revenue streams to small farmers around the world including preparing them for international certification standards.