Naman Gupta, ACT Team Leader Maharashtra, India Climate Resilient Agriculture in Maharashtra: The Role of Farmer Producer Organisations and Financing Institutions Naman Gupta, ACT Team Leader Maharashtra, India

Lets get to know Maharashtra! Third largest state of India – 308,000 sq.km. Second most populous state in India – >112 million State economy – $259 billion Agriculture and industries - largest contributors to state's economy. 82% of the state’s area is rainfed; dependent on monsoon or groundwater. More than a third of the state’s area is classified as drought- prone. Agriculture : 14.8 % of India’s GDP (2016-17) Source: Economic Survey of Maharashtra 2017-18, Department of Economics and Statistics, Government of Maharashtra

Value chain development of climate resilient crops Multi Criteria Analysis to rank key crops for climate resilience. Value Chain Analysis of five crops (Chick pea, Pigeon pea, Soybean, Pearl Millet & Sorghum) Assessment of 21 Farmer Producer Companies (FPCs) in 4 districts (socio-economically backward, salinity prone & drought prone) Identified barriers faced by FPCs Recommendations for strengthening FPCs ‘Risk rating tool’ to integrate climate & gender concerns in lending decisions Capacity development

Findings: Constrains and Gaps Faced by Farmer Producer Companies (FPC) Establishment Difficulty in understanding the initial registration process Some members are unable to give initial registration fees Unaware of what has been written in the MOA and AOA Governance Weak governance: Most FPCs managed by 1-2 BoD members Weak participation of women board members Management All the operations/management are in control of one person Lack of awareness about management of a company No guidelines for changing of directors Infrastructure Infrastructure and services limit the scale of business Need loans to buy machines for processing Markets located at a distance from the FPCs

Findings: Constrains and Gaps Faced by Farmer Producer Companies (FPC) Finance FPCs unable to give loans collateral; directors pledge own land FPCs are unable to make good business plans IFLs lack knowledge of FPCs’ business to design unique credit lines Business Business Plan is prepared in English by third party Training required in preparation own bankable business plan Few FPCs have weak business models Climate Resilience Training needed in growing CR crops FPCs need to adopt CR technologies for crop production FPCs need to adopt CR water management technologies

Recommendations IMMEDIATE ACTION, VERY HIGH IMPACT Provide handholding support in early FPC stages Improve accessible communication channels between FPCs & banks Identify target groups and topics for immediate training Implement pilot training programme Provide WASH and other facilities at FPC offices SHORT-TERM ACTION, HIGH IMPACT Inculcate business planning skills Establish better forward linkages Generate awareness - CRA, Gender, Finacial products Build capacity-improved access to finance Train banks and IFL staff Offer women-specific training MEDIUM-TERM ACTION, MODERATE IMPACT Incentivize CRA crops and CRA technology application Integrate FPC development models Enact GoM’s policy on women Change the rules of entrance for women’s membership into FPCs LONGER-TERM ACTIONS Apply M4P approach at FPC level Change household attitudes

FPC Rating Tool FPC-centred, gender and capacity needs-focused and data driven assessment Based on 8 parameters- Establishment, Governance, Management, Infrastructure, Finance, Business, Capacity Building and Climate Resilience. Set of 40 specific indicators relevant to the eight parameters Each main parameter carries specific weight in the order of importance Carries maximum marks of 100 points that an FPC can score Already applied for 600+ FPCs in Maharashtra

Applying the FPC rating tool Step 1. Discussion with FPC Board and management to understand the purpose of establishing the FPCs, current state of business operations, targets, areas in which they are struggling and doing well in. Step 2. Visits to FPC office and places where it has operations - to assist in understanding the growth in business practices, including infrastructure facilities pertaining to its business. Step 3. Village visits and interaction with member farmers, especially women, small and marginal farmers- to triangulate the data and verify the same. Step 4. Analysis of annual reports, business plans and financial statements- to ascertain FPC leadership claims on management and financial processes and help identify constraints if any. Step 5. Visit to institutions who have provided technical and handholding support- to help identify FPCs’ strengths and weaknesses Step 6. Participatory SWOT analysis - to ensure that the rating against each parameter should be commensurate with the SWOT analysis of each parameter.

Rating tool results (/100)

FPC Scoring: Dashboard

naman.gupta@actiononclimate.today THANK YOU! naman.gupta@actiononclimate.today http://www.actiononclimate.today/