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BUSINESS DEVELOPMENT

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The purpose of this mission is to create and showcase several examples of success stories in rural India to motivate other farmers and entrepreneurs to take up cultivation of aromatic crops, preferably in stressed areas where cultivation of traditional crops is either not possible or not profitable. In order to create such success stories, we need to provide all kind of support at critical steps of cultivation, processing and marketing. Once some success stories are established, more and more farmers and entrepreneurs are expected to take it further even without the extensive support by CSIR, proposed to be provided for taking up such activities.The first and foremost critical input in this Mission will be to ensure availability of quality planting material to the farmers. It is proposed that in the first phase of the activity participating institutes will provide quality planting material to the farmers free of any cost, except for the understanding that they will earn profits from the harvest of essential oil whereas they will provide planting material free of cost or at subsidized rate for further distribution to other farmers in that area in the next planting season. This will save CSIR the cost of transport of planting material to remote areas and enable the participating institutes to supply the locally produced authentic quality planting material for an efficient and faster expansion of area under cultivation of aromatic crops.

The second very critical input for promoting aromatic crops cultivation is the availability of distillation facilities in the vicinity of aromatic crop fields. Availability of such facility for the cluster of farmers will instill confidence among farmers that their crop can be processed for the extraction of essential oils. Most of the farmers in the areas, which do not have the history of cultivation of aromatic crops, are not inclined to invest in the installation of distillation units. Many of them cannot afford such investment. Hence, to motivate farmers to take up aromatic crop cultivation, it is extremely important to provide them this support to build some success stories, and to catalyze farmer empowerment through aroma mission. After getting remunerative outcomes through aromatic crops cultivation, farmers will be convinced of the success, which will then motivate affluent farmers, entrepreneurs and industrialists to invest in the installation of distillation units.We also propose to organize training to the representatives of different farmer clusters for distillation, storage and marketing of essential oils. Such trainees will not only operate distillation units installed by CSIR, they will also help farmers in marketing their produce and in getting fair price through the support of CSIR institutes. After initial support in terms of distillation units, we will connect the entrepreneurs with MSME schemes and bank schemes for financial support for establishing new distillation units.

In order to ensure fair price of essential oils to the farmers, it is also proposed to establish “essential oil procurement centres”, which will provide the facility of purchasing essential oils produced by farmers at a fair price. Creation of such facilities will deter traders from malpractices of giving unfair prices to the farmers. The corpus of the essential oils procured by such centers would be used for selling them to big aroma business houses or even for exporting outside the country to profitable rates. The oil so

collected will also be used for fractionation of some of the high value components for increasing the margin of profit from such activity.

It is expected that after the spread of aromatic crops cultivation in the targeted 5500hectare area, the total profit accrued for the farmers after 3 years period will be to the tune of Rs 50-100 crores per annum depending on the price of essential oils in the domestic and international market. This amount will be solely through the production and sale of essential oils. The area under cultivation as well as the profit is expected to grow minimally by 10% annually. The financial returns from fractionation of high value aroma components and from herbal formulations based on essential oils are expected to increase the annual turnover based on such activities to the tune of approximately 300-500 crores. In addition to financial returns, these activities will provide rural employment and restore trust of the farmers in farming related activities.

Activities Proposed

  • Establishing business linkages with National and International essential oil companies.

Deliverables

  • Providing fair price to the farmers and quality produce to the industry.
  • Establishment of business linkages to make India as a leading essential oil hub Internationally.

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