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THEME FOUR-ECONOMIC EMPOWERMENT
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HOW CAN IFAD BUILD PRIVATE SECTOR INVOLVEMENT MORE ACTIVELY INTO PROJECTS IT SUPPORTS?
• CAPACITY BUILDING:– For entrepreneurship and regular wage employment– Loan based model for skill development for wage employment– Improving employability – Employment guarantee based on skill of the entrepreneur – Train NGO’s as value chain service providers-BDS
• MARKET LINKAGES:– Buy back services /contract farming/collaborative farming/Producer
organisations– Direct sourcing from farm gate– Market intelligence – Leveraging supply chain
• PROMOTION – Aggregation– Standardization and Quality control – Branding
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• INSTITUTION BUILDING AND REGULATORY ENVIRONMENT– Producer companies /Federation of SHGs or other
community based organizations
• TECHNOLOGY SUPPORT – Product Development– Design development– Patenting/G.I/Statutory licenses i.e. FPO,AGMARK etc– Knowledge Management –extension support
• INVESTMENT– Co –investment ( seed capital/incubation fund)– Partners in the value chain
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CAN PRIVATE CORPORATE SECTOR REPLACE GOVERNMENT’S AGENCIES IN TERMS OF PROJECT MANAGEMENT ARRANGEMENT ?
• Is the private sector really interested?( Business Vs CSR)• Government have its own domain while the private sector
have its own domain ( Market).• Facilitator role for the Government and business
development role for the private sector.
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What are some of the remaining challenges that needs to be addressed in ensured rural poor can achieve better incomes and gain economic empowerment on a sustainable basis? What are expected benefits to the rural poor? What are the expected benefits to the rural poor? What are the safeguards required, if any?
Challenges:– Difficulty in Leveraging Rural Credit from bank
• High levels of financial exclusion/ high interest on borrowings • Loan goes to large farmers• SHG’s are under financed
– Risk Mitigation – natural calamities/ market risks– Venture funding opportunities limited– Access to Business Development Services– Management of Enterprises – Knowledge Management regarding Diversification of livelihood
portfolio
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Benefits
• Increase Margins• Cost cutting • Risk diversification• Economy of scale through aggregation • Value addition• Sequencing the process
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Safeguards Required
• Convergence Management.• Advocacy on livelihood opportunities/BDS • Confidence Building with community • Participatory outcome based Monitoring. • Hand holding /Mentoring services • Selection of partners which are sensitive to
rural poor
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Should IFAD play a more active role in the mainstreaming of micro finance in India and should the development of a wider range of micro finance products be part of IFAD’s programme going forward?
• IFAD need to have a Integrated approach for microfinance.• Shift from Micro credit to Micro finance-Venture funding –
Micro Insurance. • Design credit based products rather than grant products –
long term sustainability to be ensured.• Diversification of credit based products.• Community based Risk Mitigation• Enhance Seed Capital infusion to SHG’smicro enterprises.• Networking of SHG Federations/ Farmers’ clubs for micro
finance