PACS as Multi Service Centres (MSCs)bird-cpec.in/wp-content/uploads/2018/02/1-Lead-Paper... · 2018. 2. 2. · Major Agricultural Revolutions in India Green Revolution - Cereals and

PACS as Multi Service Centres (MSCs)

CGM, NABARD, Gujarat RO

The way forward ………

What is Farming?

Knowledge

Skill

Incentive

Resources

Major Agricultural Revolutions in India

Green Revolution - Cereals and Leguminous plants.

White Revolution - Milk and Dairy Products.

Blue Revolution - Fisheries

Yellow Revolution - Edible Oils

Silver Revolution - Egg and Poultry

Pink Revolution - Prawns

Golden Revolution – Fruits & Honey

Golden Fibre Revolution - Jute

Silver Fibre Revolution - Cotton

Rainbow Revolution

“integrated development of crop cultivation

with focus on pulses; horticulture, forestry,

fisheries, poultry, animal husbandry and

food processing industry”

Govt’s 7 Point Strategy to Double Farmer’s Income

Big focus on irrigation with large budgets, with the aim of "per drop, more crop.“

Provision of quality seeds and nutrients based on soil health of each field.

Large investments in warehousing and cold chains to prevent post-harvest crop losses.

Promotion of value addition through food processing.

Creation of a national farm market, removing distortions and e-platform across 585 stations.

Introduction of a new crop insurance scheme to mitigate risks at affordable cost.

Promotion of ancillary activities like poultry, beekeeping and fisheries.

Percentage Share in Farmers Income by Components – 2012-13

48%

12%

8%

32%Net Receipt from Cultivation

Net Receipt from farming of Animals

Net Receipt from Non Farm business

Income from other sources includingwages

(Situation Assessment Survey 70th Round NSSO)

More the Farm holding, more the share of Income from Farm holding

Health of PACS• 93367 PACS - 45241 Profit, 36695 in loss, 4116 – Dormant/ inactive

• Borrower to member ratio less than 50%.

• Of the total assets of Coop. Credit structure – 22% are with PACS

• Among three ST coop. credit structures- PACS are most dependent on borrowed funds

• Since 2010, share of non- agriculture loan through PACS has increased at the cost of agricultural loans’

Source : Trend and Progress of Banking in India – RBI – 31.3.2017

Health of PACS (contd.)

Borrower to Member Ratio

Category Shortfall from aspired level of 50% access

Scheduled Caste 14.2 %

Scheduled Tribes 13.9 %

Small Farmers 8.1 %

Rural Artisans 14.7 %

Marginal Farmers 18.1 %

Why PACS as MSC ? PACS have the network

PACS generally meet out only the short term credit requirements of its members

On the other hand,

Due to uneconomic land holdings, majority of farmers unable to afford purchase of farm equipment

New inventions and developments need to be brought to the farms ASAP

Farmers resort to distress sale as they are in the need of immediate credit

Adequate storage capacity is not available in the rural areas

Presently, large number of PACS are rather small in size, to be viable.

Problems of infrastructural weaknesses, operational inefficiencies etc.

Therefore, need to re-orient PACS which will make them sustainable and inspire confidence in their existing and

potential members

Why PACS as MSC ?

PACS need to be developed as a One Stop Shop for meeting all the needs of its member

PACS have to look for new Business opportunities

Provide much-needed forward and backward linkages.

PACS can help transform agriculture into a more financially viable activity

PACS as MSC can help members to become self-reliant and promote rural

entrepreneurship - facilitating increased income

PACS as MSC – can financially strengthen the members, by increasing their income

through economic linkages with various sectors of rural economy -Doubling of income

Indicative list of possible business activities

Agro-Storage Centre - Good quality storage capacity as per WDRA Act

Agro-Service Centre - Custom hiring of agricultural implements, collective purchase

of inputs

Agro-Processing Centre : Primary and Secondary processing

Agri-information Centre : Extension Services

Agri Transportation & Marketing Facilities

Consumer Store/ Other Miscellaneous Activities

PACS as PO for on-lending to Members for Farm/ NFS/ Service Activities besides

ST-SAO

PACS as MSC : The way forward …

PACS as MSC - Technology supported activities like Micro-ATMs and Wi-Fi Internet.

Through Micro-ATMs, PACS members who stay far away from the PACS also can have

access to banking services

PACS as BCs can undertake various activities under financial inclusion and Aadhaar

linkage of bank account.

Potential for expansion of business through convergence with other stakeholders like

Farmers Producer Organizations

PACS can be provided direct exposure to best practices in various facets of agri-business

through partnerships with leading Agricultural Universities / institutes.

Some of the Innovative things done by few PACS in Gujarat

• RO Water plant;

• Construction of Godowns and Accreditation of the same under WDRA;

• Custom Hiring Centre for Tractors & Implements;

• Consumer Store;

• Sale of Cement and Cattle Feed;

• Installation of Xerox Machine;

• Setting up of Flour Mill;

• Planning to go for Renewable Energy

This has resulted in increased membership, more business, more income – a step towards sustainability

Significance of PACS

“There should be one cooperative for every village and everyvillage should be covered by a cooperative” –

The Maclagan Committee, 1915

“if cooperation fails, there will fail the best hope of rural India” –Royal Commission

Thank You