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Growth Pole Programme:

Kollam

Final Report

F e b r u a r y 2 0 0 8

Kerala Bureau of Industrial Promotion ( K BIP )

Government of Kerala

National Commission on Enterprises in the Unorganised Sector (NCEUS),

Government of India

Prepa r ed by

Infrastructure Leasing & Financial Services Limited

Kollam Growth Pole Final DPR

KBIP, GoK I

TABLE OF CONTENTS

Executive Summary i-xii PART I 1. Introduction 1 2. Approach, Objectives, Methodology 2 2.1. The Growth Pole Approach 2 2.2. Integrating the PURA Concept 3 2.3. Objectives of the Kollam Growth Pole Programme 4 2.4. Methodology 5 3. Regional Setting, Description of Area 7 3.1. Location and General Features 7 3.1.1. Demography and Growth Trends 8 3.2. Human Development Aspects 8 3.2.1. Socio Economic Aspects 9 3.2.2. Industrial Performance 11 3.3. Infrastructure and Linkages 11 3.3.1. Social Infrastructure 12 3.3.2. Physical Infrastructure 13 3.4. Banking Infrastructure and Credit 18 3.4.1. Micro Finance 20 3.5. Overall Scenario 20 PART II 4. Key Sectors 21 4.1. Overall Background 21 4.2. Primary Interactions 22 4 A. Cashew Sector 25 4.1. Cluster Profile 25 4.2. Process Profile 26 4.2.1. Description of the various stages of Cashew Processing: 27 4.3. Product Profile 31 4.3.1. Value Chain Analysis 31 4.4. People profile 32 4.5. Linkages and networks 35 4.5.1. Market linkages 35 4.5.2. Credit Linkages 37 4.5.3. Agencies and Institutions in the cashew processing sector 39 4.6. Gap and Issues Analysis 40 4.6.1. SWOT Analysis 43 4.7. Project approach and sector theme 45 4.8. Overall interventions 45 4.8.1. Project Components: 45 4.8.2. Financial aspects 50


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4.9. Institutional partnerships 51 4.9.1. Funding sources and schemes 52 4.B. Fisheries Sector 54 4.1. Marine Fisheries: Cluster Profile 55 4.2. Process Profile 56 4.3. Product Profile 58 4.4. People profile 59 4.5. Inland Fisheries 61 4.5.1. Cluster Profile: 61 4.5.2. Process and Product Profile 61 4.5.3. People Profile 62 4.6. Linkages and networks 64 4.6.1. Credit Linkages and Issues 64 4.6.2. Feedback from people involved with the sector: Marine and Inland 65 4.7. Issues and Gap Analysis 67 4.7.1. SWOT Analysis 72 4.8. Overall interventions 72 4.8.1. Project approach and sector theme 72 4.9. Interventions Financial Details 73 4.9.1. Fisheries Sector: Marine Fisheries 73 4.9.2. Project components 74 4.9.3. Overall Financials 76 4.10. Institutional partnerships 77 4.10.1. Funding sources and schemes 78 4. C. Coir Sector 82 4.1. Cluster Profile 82 4.1.1. Background 83 4.2. Process Profile 84 4.3. Product Profile 88 4.3.1. Important Trade varieties of Coir yarn and its Specification 88 4.3.2. Value chain analysis 90 4.4. People profile 91 4.5. Linkages and networks 92 4.5.1. Backward linkages 92 4.6. Issues and Gap Analysis 92 4.6.1. SWOT Analysis 94 4.6.2. Overall Potential areas of Development 95 4.7. Project approach and Sector Theme 97 4.7.1. Proposed Interventions 97 4.7.2. Project Components 100 4.7.3. Financial aspects, funding with source, and management 101 4.8. Institutional partnerships 102 4.8.1. Sources of Funding and Schemes 102 4. D. Tourism Sector 106 4.1. Tourism in Kerala 106 4.2. Kollam - status in Kerala Tourism 109 4.2.1. Tourism Infrastructure in Kollam 112 4.3. Analysis 113


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4.3.1. SWOT of Tourism 113 4.4. Interventions Proposed: Approach 114 4.4.1. 5-yr perspective and approach 114 4.5. Overall Interventions Proposed: Plan and comonents 115 4.5.1. Program Structure 116 4.5.2. The Integrated Tourism Development Zone 117 4.5.3. Integration of Local Economy with Tourism 120 4.6. Financial Estimates 133 4.6.1. Sources of Funds 134 4.7. Impacts 134 4.8. Roll Out 135 5. PURA Linkages and Cross-cutting Issues 137 5.1. Cross-cutting Infrastructure Themes 137 5.2. Proposed/Planned Infrastructure Development 137 5.2.1. Roads, Bridges and Harbour Links 138 5.2.2. Town Level Infrastructure Development 138 5.3. Overall Financials for Infrastructure 139 5. A. Lake Management 140 5.1. Overview 140 5.1.1. Ashtamudi Lake 140 5.1.2. Shastamkotta Lake 141 5.2. Lake Management: Approach and Strategy 142 5.2.1. Components of strategy 142 5.2.2. Operationalising the strategy 143 5.2.3. Regulatory aspects and fund streams 144 5.2.4. Implementation process 144 5.3. Financial Aspects 145 5. B PURA Connectivities: Small Enterprises Development 146 5.1. Services and Small Enterprises Development 146 5.1.1. Small enterprise development project 146 5.1.2. Small enterprise development project: Financials 147 5.1.3. Institutional links and Synergies 148 Part III 6. Implementation Arrangements 149 6.1. Overall implementation structure 149 6.2. Project Implementation Agency 151 6.3. Monitoring and Evaluation 151 6.4. Implementation Partnerships and synergies 152 6.4.1. Cashew 152 6.4.2. Fisheries 152 6.4.3. Coir 153 6.4.4. Tourism and Handicrafts 153 6.4.5. Services/Small Enterprises Development 153 6.5. Lake Management 154 7. Financial aspects 155 7.1. Summary of Financials for the Five-yr Programme 155


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7.1.1. Other proposed and ongoing programmes in the Growth Pole Area 156 7.1.2. Overall Funding of Key Existing Sectors 156 7.2. Funding and Sources: Sectors: 158 7.2.1. Cashew Sector 158 7.2.2. Fisheries Sector 159 7.2.3. Coir Sector 159 7.2.4. Tourism Sector 160 7.2.5. Craft development and development of local village economies 160 7.3. Project Management 161 8. Coverage and Impacts 162 Part IV (Separate Volume) Annexes

Executive Summary Kollam Growth Pole

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KOLLAM GROWTH POLE PROGRAMME – EXECUTIVE SUMMARY

IL&FS has prepared a Draft Detailed Project Report (DPR) for the Kollam Growth Pole for the Kerala Bureau of Industrial Promotion (KBIP) of Government of Kerala and National Commission on Enterprises in the Unorganised Sector (NCEUS), Government of India. A part of Kollam District has been selected by the Government of Kerala and NCEUS, to be developed according to this approach. (See map) The Growth Pole approach, defined in the Indian Context by the NCEUS is seen as a viable concept through which the existing sectors/clusters could be re-energised through sector specific and cross-cutting infrastructural interventions. The Growth Pole Programme is proposed as a set of strategies with a 5-yr implementation period that will cover multi sector interventions to address the following objectives:

• To develop a sustainable growth model for Kollam Growth Pole Area by: Focusing the unorganized/informal sector within the identified geographical area Adopting cluster model development of enterprises Integrating the various schemes applicable Developing complementary clusters Aiming to enhance the income generation of the work force in these sectors

• To expand the production and employment in the unorganized enterprises through clusters around selected existing clusters of industrial activities and services and encourage the formation of new clusters

• To conduct a benchmark study on required technology interventions. entrepreneurship and latest trends in various major sectors in Kollam which has declined over a period of time and to implement the facilities required for improvement

• To provide assistance in the lagging areas and to improve their entrepreneurial skills • For upliftment of the socially backward groups in the area; mostly women artisans/ workers

Below Poverty Level (BPL) • To integrate these unorganized units with the mainstream of the process of economic growth

through the creation of markets and the use of market-related incentives • To spread industrialisation throughout the country, outside the large industrial areas through

the growth in the productivity and efficiency in the unorganised sector through small and micro enterprises and rural industrialisation


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In addition, NCEUS has emphasised the idea of promoting the Growth Pole Concept along with the incorporation of PURA principles, for sustainable and accelerated economic growth through enterprise development in the identified area.

THE GROWTH POLE PROGRAMME

IL&FS undertook an assessment of the status of the programme area to arrive at gaps and potentials, both in terms of the general development in the area and in the key clusters within the Growth Pole that are proposed to be covered in the intermediate and longer term interventions. A document outlining the short-term interventions strategy for a one-year period, with the idea that this would kick-start the longer (5-yr), overall programme for the Kollam Growth Pole Area (whilst also being an integrated part of the larger exercise) was completed and submitted to the Kerala Government earlier in the year. In addition to sector assessments and outlining the proposed strategy and interventions, financial details regarding funding sources, potential partner agencies, resources and implementation arrangements have also been included in the document. Further to the one-year project, the overall approach and strategies regarding interventions in the key sectors and supporting infrastructure for the whole programme period (5-yr) have been proposed along with detailed plans for implementation These include technical details in terms of infrastructure training, staffing, skills development, technology; financial implications of the above with proposed sources of funds and implementation structures and arrangements applicable to the key existing sectors, proposed potential areas of development, cross cutting areas and overall development and management for the Growth Pole.

CONSULTATION AND DISCUSSIONS

Details of the Kollam Growth Pole programme have been presented and discussed in various forums to introduce and define the concept, capture key concerns and suggestions through the emergent discussions and deliberations on the best possible synergies (with departments and agencies) for its effective implementation and roll-out. These exercises carried out through April, May and June this year (2007) become particularly significant as a key aspect of the Growth Pole Strategy is to synergise the interventions with existing programmes and initiatives and include them into the overall strategy for the Growth Pole Area, and to establish a consensus with the key stakeholders and potential drivers of the proposed process. Key features of the Kollam Growth Pole Programme (Draft) are included below:

SECTORS

A comparison of the figures for employment and total annual turnover in the focus sectors brings out the existing disparities in terms of performance. In addition, the orientation towards export is also of significance. Assessments within these existing and well-established sectors brought out a wide variety of gaps and issues of concern regarding the present functioning and the future prospects, given the changing contexts and the limits on resources available, for the various sectors. In addition to the existing sectors in the Kollam area, new potential sectors (Tourism) were assessed for their potential and plans were made accordingly, to support and develop them over the 5-yr

GROWTH POLE Employment Units Turnover ExportsRs Cr Rs Cr

FISHERIES 36,186 NA 928 212CASHEW 176,632 614 2,007 1,544COIR 34,218 9,390 58 10


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period. Cross cutting issues like infrastructure, resource management (Lake resources), service and skills development etc were also included to round out the overall development of the area as a whole, with the inclusion of synergies across the board.

CASHEW SECTOR

Kollam is synonymous with Cashew processing and 60% of the country’s exports are from the clusters within the Growth Pole area. Known for its traditional drum-roasting process and unique flavour, the sector has not invested in much upgradation in terms of technology, worker environment and good practises, and, as a result, has several issues. The following provide an overview of issues in the sector, followed by the proposed interventions in the sector, under the Growth Pole Programme.

• Development of innovative processing technologies is needed for process improvement and to reduce cost of production

• Training of labour is currently in house (on- the- job). Specialized training inputs is particularly relevant as the cluster enterprises move towards manufacturing value added products and lower the exposure to risk for workers.

• The working conditions of cashew processing centers are to improved for getting maximum productivity from workers, with special attention on women workers’ issues .

• Steam boiling process is an option to enhance productivity. However, R&D initiatives are required to explore the means of retaining the original taste/ flavour of cashew

• The brand of Kollam Cashew in terms of drum roasting and de shelling is yet to be protected and promoted.

Proposed Interventions

Model Units

• Improved process efficiencies in different unit types –Drum roasting (traditional)- 4 units in the SSI sector and 2 in the unorganised sector –Steam boiling (newer method)- 2 units from the organised sector. --Shelling and peeling (processing – in the roasting system)- this would be covered in the 2 organised units (drum roasting) and in addition, 2 units from the unorganised sector will also be taken up, that concentrate on this activity. --Grading, re-grading and packing-- this would be covered in the 2 units in the organised sector (drum roasting), 2 units in the organised sector(steam boiling), mentioned earlier. In addition, 2 units from the unorganised sector will also be taken up, that concentrate on this activity.

• Research and development (processes and management systems): this includes an overall systems approach to resource and process optimization including interventions in the management practices followed, to ensure all-round efficiencies

• Improved safety, health and environment (SHE) with a particular focus on worker health and safety. This would further draw from a number of other proposed interventions, like the module on work methods improvement to address specific issues of posture-change and tooling; adoption of mechanization; adhering to food safety standards etc.

• Improved hygiene for Food Safety Standards compliance: Demonstration, system upgradation and training (including training of trainers)

• Work methods improvement (R&D and capacity building)


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• Sector-wide, multi-level dissemination of improved practises in terms of technology upgradation, worker-environment and safety improvement, efficiency improvement, management systems upgradation, etc, to encourage wider uptake.

EDP AND CAPACITY BUILDING INITIATIVE:

This would cover 500 units with 4 persons nominated by/ selected per unit for 4 types of training: 1. Process efficiencies 2. Worker health and safety (supervisor training) 3. Worker health and safety (women workers) 4. Cleaner practices and standards

With continuing refresher courses in the following: 1. Efficiencies training 2. Health and safety-

FISHERIES (MARINE AND INLAND)

The fisheries sector in Kollam is an important one with Marine Fisheries being a significant economic activity given the length of coast line available to the district. Inland fisheries, practiced largely in the Ashtamudi Lake (saline water) and canal is a less intense practise in the Shastamkota Lake as that is the source of fresh water supply to Kollam Town (drinking water source). Marine fisheries is the default sector of importance here, with about 70% of the population in the area dependent upon the fishing industry for its livelihood and has a total turnover of about Rs. 1,439 crores and exports accounts for about Rs 920 crores There are more than 36,000 persons from the Kollam Growth Pole directly involved with the marine fisheries sector and a large proportion of this group is made up of fisher men. Women are mostly involved with pre-processing and processing, and vending operations.

• The fisheries sector in its present form though it has the critical numbers is still unorganized in nature and does not have any bargaining power.

• The poor and un-hygiene condition of landing and auction centers. • Un availability of potable water and quality ice at the landing centers. • Poor sanitation and allied issues. • Dumping of wastes including plastics in the sea shore. • Lack of post harvest infrastructure such as cold storages ice plants, peeling centers fish

curing centers and processing plants. • Even though this area is enriched with heavy fish landing, there are very limited centres for

value addition. • Lack of Central Quality Control Laboratories in the growth pole area. • Limited exposure to organized market. • There is no collective effort for boosting up of aquaculture activities. • Lack of proper Training cum product development centre in the area.


Focusing on the marine fisheries aspect the intervention aims to demonstrate the following: • Improvements in value addition by improving hygiene in storage and cleaning practices • Inculcating standard processes in handling, to be used to ensure compliance with food safety

and hygiene standards


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• Improvement in working conditions through improvements in living and working environment, better facilities, training and availability of amenities at the landing center.

• Cross cutting intervention on overall environment improvement along the shore line for improved fish catch (value, quality and quantity) food safety (value, quality) community health and environment

INTEGRATION OF LANDING CENTRE, PRE-PROCESSING AND OTHER ACTIVITIES ALONG THE VALUE CHAIN

Project components include the following • Landing center upgradation –Thangasarry:

–Shed improvement –Refrigerated (temperature controlled) sub-section for high value fish –Access road development

• Multi-utility space and waiting area (including for communication, training); Access amenities for local fish retailing –Sheltered waiting area (multi utility space) for fish salespersons –Multi-media communications/training in waiting space (hygiene and cleanliness issues, health, women and child development, enterprise development, waste management, tourism etc etc) –Sea-food kiosk/canteen for fisher-folk, also general public –Amenities while waiting.

• Waste management initiative in harbour for fish waste, at all locations –Collection system –Awareness and sensitisation

• Infrastructure for value addition -Pre-processing centre / training - Wadi Moothukarra -Solar fish drying demo Wadi-Moothukarra -Drying unit (with solar back-up)

• Ice making unit -Moothukara • Solid waste management, sewerage treatment (components already included in the Urban

Improvement Project of the Government of Kerala pending approval of funding from the ADB), –Address municipal solid waste dumping issue –Sewerage outfall- technical channelling and treatment

COIR

The Coir cluster in the Kollam Growth Pole Area has a turnover of about Rs.58 crores. Exports account for about Rs. 9.8 crores (16.9%) of this figure. A very important traditional industry, it employs nearly 3.75 lakhs of workers with nearly 76% of them being women folk. Exports comprise coir yarn and relatively more value added products such as geo- textiles manufactured in the cluster. These items are exported via Alleppy-based agents. Enterprises largely operate at the lower end of the value chain - manufacturing only coir yarn. There are about 2000 cottage and 20 tiny yarn spinning units in the cluster operating in the private, largely informal sector. There are about 90 units functioning Co- operative societies, involved in similar activity. The Growth Pole Area has 2 de-fibering units of the ones currently operational here. The cluster provides employment to about


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51,683 workers, with direct employment to 34,218 persons. In addition, some people also engage in coir related activity on a part-time basis due to inadequate supply/availability of fiber and relatively poor productivity and wages. Overview of key issues in the sector:

• Poor husk collection facilities / systems affecting competitive availability of husk . • The particular variety, “Mangadan” coir has limited application in the matting sector. • Informal sector enterprises operating in the lower end of the value chain with scant resources

to invest in technology or value added production with out fiscal assistance. • Inadequate de-fibering capacity. • Limited access to institutional finance. • Sector not attracting new investments or employees, given work methods and condition • Supply constraints of husk affecting capacity utilization of cluster enterprises and hence

competitiveness • Competitive threats from spinning units employing automatic ratts in other states such as

Tamil Nadu . • Inadequate profit margin leading to exist of labour force from the spinning sector


The initial interventions in this sector are designed to address the early part of the process: collection, defibring and risk-offsetting through skill diversification. Efficiencies in collection are likely to be achieved in the model project period (1- 1.5 yrs) with greater value being obtained from the resource through product diversification. The subsequent parts of the coir processing value chain are addressed in the following years of the Growth Pole Programme with a parallel scaling up of this initiative. The overarching objective is to revive Kollam as a preferred production centre with a concurrent strategy of skill diversification to reduce dependence on a single source. Along with this, to achieve improved incomes through resource maximization (from the collected nuts, using the husk towards yarn and making shell-based products from the previously-discarded shell, ensuring two --or more-- sets of value addition) The following diagram represents the phases of the process in the proposed integrated and diversified model.

• Improved collection of locally available husk: Setting up groups and systems with adequate supply of materials (collection bins), and transport facilities.

• Upgradation and installation of new defibring unit and linking it to existing cooperatives to demonstrate efficiencies along the value chain.

COLLECTION

SHELL

HUSK

P

Processing

Processing Market

Market

Market

Processing and conditioning

SpinningDefibring Matting

Cutting &


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• Expanding to shell based products: Re-skilling coir workers to work with coconut shell product manufacture as a strategy to diversify risk, get an additional source of income, and reduce dependence on one industry

o In addition to linking the existing R&D on shell-based products, training will be provided to interested groups. This is intended to focus on coir workers but others may also join, after forming groups

o Forward links to markets willing to procure the shell-based products through buyer-seller meets, participation in fairs and direct interactions

TOURISM, HANDICRAFTS AND RELATED LOCAL ENTERPRISES

Kollam is one of the least developed districts in terms of Kerala’s tourism and contributes less than 2% of Kerala’s tourists, whether domestic or international, even though it has all the advantages as a tourism destination that Kerala has become famous for.– backwaters, health, beaches, heritage. However, its performance has been poor both in terms of development of tourism destinations as well as actual throughput of tourists. Additionally, very few linkages exist with local culture, handicrafts and cuisine – as a concerted and thematic effort in the project area, to boost tourism. The state’s medium term goal for tourism in Kollam has not resulted in significant footfalls thus far compared to other locations in Kerala. The plan under the Growth Pole Programme has been developed to reverse this trend in the five-year period

PART I: INTEGRATED TOURISM DEVELOPMENT.

This includes a number of sub-projects and project-propositions that, as part of the Growth Pole exercise, may be developed and explored. It is possible that some of these projects will be formulated as a separate exercise with its own budget and funding arrangements. Whilst the initial and essential exercise will require the involvement of the government, to a small degree, in terms of finance and support, to set the tone for the development, subsequent projects, identified and formulate as part of this integrated planning, may be developed and implemented separately.

PART II:

This supporting set of initiates are thematically, part of the Integrated Tourism Development plan, and also have complementary objectives for their individual sectors/clusters. This part covers the development of sites and areas (precincts and whole villages), craft (lace-making, screw-pine, bamboo, temple handicrafts etc) and traditional artisanal work like black-smithy, dairying, fishing, etc. These are presented in the table below, with areas flagged for the locations of development- this preliminary identification has been done in consultation with the local communities and Grama Panchyats. Components of the Plan Location PART I 1 Integrated Tourism Development Zone Kollam to Paravoor

Hotels Catering and restaurants Tourism Complexes Theme Parks PART II

Integration of local economy with Tourism

2 Model Fishing Village Allapad

3 Nature tourism (Aqua) Vellimon

4 Village Tourism Project Thekkumbagam


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5 Crafts/Cultural based tourism

Performing arts centre Sooranadu Temple Handicrafts Poruvazhy and Kottankulangara Blacksmiths Kottarakkara Screw Pine / lace Eravipuram Bamboo Mannakara Festivals Malanada in Poruvazhi Anayadi in Soornadu North Kottakulangara in Karunagappally 6 Activity Based Tourism Dairy Kundara & Mulavana Agriculture Muthuvilakadu, Neduvathoor, Puthur Coir Perumon Cashew food court Killikollure

CROSS CUTTING THEMES

Towards the ends of achieving and supporting growth and development across sectors, the infrastructure initiatives, within the Growth Pole Programme continue the process of establishing and supporting cross-cutting themes and linkages.

• Through development of common infrastructure like roads, bridges, cleaning maintaining and dredging of harbour

• Through the development of town level infrastructure in Kollam city, like sewerage and drainage, waste treatment and disposal, currently causing pollution in the water-bodies.

INFRASTRUCTURE

Several works of reconstruction and repair at a large scale have been recently completed in the Kollam Growth Pole area, as a result of rehabilitation works under the state’s Tsunami Rehabilitation Program (TRP). Several others are being implemented or will soon be undertaken under the ADB component – Tsunami Emergency Assistance Programme (TEAP). These, in addition to restoring the old infrastructure have been planned taking into account present and future requirements and have been designed to be technically more sound (bridges). Consequently, these will be most beneficial to the community at large and fishermen and those associated with the sector, in particular. Most of these are planned to be completed within the next few years. The components of consequence to the Kollam Growth Pole, are as below:

ROAD BRIDGES AND HARBOUR LINKS

A Construction of Roads and Bridges

1 Construction of bridge across TS Canal connecting Ayiramthengu and Azheekal (ownership PWD)-reteroactive work- ongoing

2 Construction of Kallummoottil Kadavu bridge (ownership PWD)-new work 3 Improvements to coastal road from Pozhikkara to Kappil (13/850 to 18/300). (ownership PWD)-new

work

4 Improvements to Lalaji Junction- TS Canal (Panickerkadavu) Rd. (ownership PWD)-new work 5 Improvements to Oachira-Ayiramthengu (ownership PWD)-new work

B Ports/Harbour development, Fishery development

1 Neendakara Port and Fishery Harbour: Repair of Roads and Protection Works 2 Neendakara Port and Fishery Harbour: Dredging 3 Thangaserry Fishery Harbour: Rectification of Breakwater, repair of road and protection work


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TOWN LEVEL INFRASTRUCTURE DEVELOPMENT

The most urgent areas requiring attention and considerable investment, solid waste management, sewerage and drainage, account for almost 60% of the total proposed budget for infrastructure. Projected Govt of Kerala Contribution* towards GP project through proposed ADB Loan to state government for infrastructure development under the: Kerala Sustainable Urban Development Project (PPTA 4106 – IND);- Kollam Town Component Sanitation, STPs and Drainage Solid waste management Further to physical infrastructure and management issues, two other cross-cutting themes have been introduced in the Growth Pole Area. These are

• A module on management of the lake systems in the Growth Pole Area, the benefits from which will be felt across the resident community, and keys sectors like fishing, tourism and the lake ecology.

• Introduction and support of a service-delivery based local enterprise model.

LAKE MANAGEMENT PLAN

Components of strategy

1. Identification and plotting/mapping of Lake Area (present, as compared to the earlier lake boundaries) and a “command area” based on the watershed, to be housed in an appropriate government agency, that may take the effort forward and be responsible for subsequent and regular monitoring exercises:

a. Mapping of boundary, existing and previous, on a GIS platform b. Identification of present ownership and status of tenure c. Land use along the lake shore

2. Soil and water conservation measures to be put into motion, based on a ground truthing and available data. .The idea of the exercise is to reduce the silt load on the lake. This load is influenced by several factors in the command area that also need to be monitored, like cropping pattern based on topography, digging silt pits, to be mobilised through a community initiative driven by awareness campaigns and supported and monitored by Grama Panchayat bodies (PRIs).

3. Monitoring of Channels feeding the lake for water quality, pollutants (nature) and source. These will then need to be incorporated into the management strategy.

4. Measure, assess and report pollutant load in lake on a regular format with the participation of the community and concerned stakeholders. This also helps to establish a credible cause-effect scenario that the community awareness drives may plug into their efforts, and also involve the PRIs.

5. Identify and assess Household level pollution- inflow of untreated domestic waste: sewerage, kitchen/washing wastewater, etc. The awareness campaign would include the introduction of appropriate technologies for preventing this and support the monitoring bodies to help assess and deal with the issue.

Community involvement and support will be the most crucial ingredient to this strategy, especially the ones dwelling along the lake perimeter. PRIs, from the relevant Grama Panchayats taking up the implementation of this programme after due consultation with the community and building consensus on tough issues, would be the most effective way forward. The other significant

* : Kerala Sustainable Urban Development Project (PPTA 4106 – IND); May 2005- Govt of Kerala, Local Self Govt Dept


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stakeholder group is fisherfolk who fish in the lake systems. This category overlaps with the lakeside-dwellers but have a different set of interests in the lake resource. Reconciling their interests with the requirement of ecological rejuvenation and conservation of the lake will be the other key challenge

SERVICES AND SMALL ENTERPRISES DEVELOPMENT

Another area of employment generation that is fast emerging, given Kerala’s (and Kollam’s) particular development context, is the provision of small household and office-level support services like plumbing, electrical and electronic works, general property maintenance, etc. Even as the old courses set up at ITIs have traditionally addressed this sector in a limited way, there is tremendous opportunity to look at provision of training to young enterprising educated youth in both rural and urban areas to supply to this growing market. These are services that are cross-cutting in their application and can be run on a small enterprise-based model with low capital investment. Key to their growth is linkages: Physical-road, Communication-phone, and Knowledge-skills. A small pilot to start organizing this set of linkage based services had been proposed in the first phase, that would be suitably tailored and rolled-out on a larger scale in the subsequent stages of the programme. Tentatively, this scaling up has been project to include a wider spread with the introduction of 3-5 newer courses at the end of two years, based on the response to the pilot. The further scaling up may be based on this, as also the selection of the new courses

IMPLEMENTATION STRUCTURE

The following diagram represents the proposed implementation structure for the programme

The Project Implementation Agency should have the following experience:

• Cluster Development • Infrastructure Development • Financial structuring

KBIP Project

Implementation Agency

PRIs, lake-community, fisher-folk, coir-retters,

Municipal Corp

Industry associations SHGs, CIGs, PRIs, NGOs,

Cooperatives

CFCs

SPV driven by 6 association reps drawn

from fishermen, vendors and processors

Cashew Sector

Non-CFC

Headed by: CEO (10-15yr Experience in Proj Implementation and Management)7 staff of Sector ExpertsFisheries, Cashew, Coir, Tourism, Services, Environment, Finance

Fishery Sector

Coir Sector

Overall Project FacilitationCluster Development InputsResource Centre for Training (eg. HACCP)Project Monitoring


from cooperatives, Kudumbasree groups

SPV driven by association of SSI, State Cashew Dev

Corp and unorganised sector

Fish,Cashew, Coir Handicraft

Tourism: Sea,Lake-based

Small Enterprise

Development

PRIs (nomination), ITIs, Technical/Engg College,

Mgmt Institute

Infrastructure development

Municipal Corp, Mandated Impl Agencies, State Dept,

etc

Advisory/Consultative Committee

Project Management Support

KBIP Project



Municipal Corp


Cooperatives

CFCs



Cashew Sector

Non-CFC


Fishery Sector

Coir Sector








Small Enterprise

Development


Mgmt Institute



etc




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• Structuring and implementation of Public Private Partnerships • Project Management

o Project development o Legal documentation and tendering o Monitoring, evaluation and reporting o Coordination with state and central government departments and agencies to ensure

smooth dovetailing of funding streams for various project components • Ability to take stakes in SPVs created for ownership, management and operations of assets

created as part of larger Growth Pole programme

ROLE OF AGENCY:

• Overall responsibility of implementing the Growth Pole programme • Mobilising resources including funding from various state, central schemes and financial

institutions • Facilitating linkages to market as necessary • Capacity building of stakeholders as envisaged in the project through partner institutions and

experts • Mobilize user groups and beneficiaries and structure appropriate Public Private Community

Partnerships to enable creation of common facilities • Undertake all legal documentation and paperwork necessary to effect PPPs, PPCPs, training

and technology infusion arrangements. • Identification, dissemination and transfer of appropriate technology for the Cashew, coir and

fisheries sectors as envisaged • Catalyse private sector investment as envisaged in the programme • Structuring frameworks to implement identified projects through special purpose vehicles

A key facet to the timely roll-out of the project is the access to various complementary schemes of the central govt. The state government through its nodal institution can facilitate and expedite the approvals for such proposals, that will be prepared and presented by the implementation agency. It is proposed that periodic monitoring and evaluation be undertaken to ensure effective performance and delivery of the envisaged goals of the programme.

SUMMARY OF FINANCIALS FOR THE FIVE-YR PROGRAMME

Sector In Rs Lakh

% of sub-total

% of Program Total**

Cashew 2258 15.41% 14.85% Fisheries 4406 30.08% 28.97% Coir 1077 7.35% 7.08% Tourism 6148 41.97% 40.43% Local Economy and Crafts Dev 761 5.19% 5.00%

I SUB-TOTAL (Sectors) 14650 100% Cross-Cutting In Rs

Lakh % of sub-

total % of Program

Total*

Lake Management 495 88.93% 3.26% Small Enterprises/Services 62 11.07% 0.41%

II SUB-TOTAL (Cross-cutting) 557 100% Sub Totals I+II 15206


xii KBIP, GoK

Sector In Rs Lakh

% of sub-total


Project Management^^ 1255 III **PROGRAM TOTAL (Growth Pole) 16462 59.44%

^^ @12.5% for the Overall Program and 2% for the Tourism component

Infrastructure Proposed/approved under other funded projects/programs)

In Rs Lakh

% of sub-total

% of Grand Total

Roads and Bridges 3033 27.00% 10.95% Ports/harbour and Fishery Development 837 7.45% 3.02% Sanitation, STPs and Drainage 6620 58.93% 23.90% Solid waste management 742 6.61% 2.68% IV INFRASTRUCTURE TOTAL 11232 100.00% 40.56%

GRAND TOTAL (III+IV) 27694

Kollam Growth Pole: Consolidated Financials (in Rs Cr) 276.94

FUNDING AND SOURCES: SECTORS:

The following table gives total costs and envisaged sources of funding for the key sectors. The funds under Government of India and Kerala Government are based on the schemes available and the outlined eligibility criteria. This is, of course, contingent to the qualification of the initiatives under the outlined criteria, at the time of availment.

Summary of Costs: Sectors Rs Lacs % eligible under various heads

Sector Total GOI GOK Users Pvt sector /banks

NCEUS

Cashew 2,258.00 5% 0% 33% 24% 38% Fisheries 4,406.00 30% 29% 29% 1% 10% Coir 1,076.80 37% 1% 6% 5% 52% Tourism 6,148.06 0% 4% 0% 92% 4% Local Economy and Crafts based interventions

761.00 13% 29% 16% 29% 14%

Lake Management Plan 495.00 0% 10% 5% 0% 85% Small Enterprise Development 61.60 45% 0% 3% 0% 51% TOTAL 15,206.46 13% 12% 15% 43% 18%


KBIP, GoK

Part I

• Introduction and Development Status: Kollam Growth Pole Area


1 KBIP, GoK

1. INTRODUCTION

This Detailed Project Report (DPR) for the Kollam Growth Pole; has been prepared by Cluster Development Initiative of Infrastructure Leasing and Financial Services Ltd (IL&FS), for Kerala Bureau of Industrial Promotion (KBIP) of Government of Kerala and the National Commission on Enterprises in the Unorganised Sector (NCEUS), Government of India. IL&FS has already prepared and submitted to the government, a document outlining the short-term interventions strategy for a one-year period, with the idea that the one-year interventions would kick-start the longer (5-yr), overall programme for the Kollam Growth Pole Area whilst also being an integrated part of the larger exercise. This document comprises an overall status assessment of the programme area to arrive at gaps and potentials, both in terms of the general development in the area and in the key clusters within the Growth Pole that may be included in the intermediate and longer terms. In addition to sector assessments and outlining the proposed strategy and interventions, financial details regarding funding sources, potential partner agencies, resources and implementation arrangements have also been included.


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2. APPROACH, OBJECTIVES, METHODOLOGY

A part of Kollam District has been selected by the Government of Kerala and NCEUS, to be developed according to the Growth Pole approach. A district of Kerala, Kollam has contributed to the state’s distinctive development path and reflects many of these aspects in its own evolution in recent decades. The current scenario demonstrates a notably high degree of achievement in terms of education and health related indicators, with high population densities that nonetheless, show a slowed rate of growth (fertility rates in parts indicate population growth to be below replacement rates already). With significant growth in the services sector, Kerala’s economy is no longer biased towards the primary sector (which contributes 26% of the state’s income and forms 32% of its total employment), as is the case with the rest of the country. Historically, the manufacturing sector has been small in Kerala but significant in Kollam and continues to contribute to the overall employment. Home to traditional industry clusters like cashew, coir and fishery related enterprises- both organised and unorganised, it is most well known for cashew. Not much new industry has located in this area and even the old industry faces several problems and barriers to healthy and sustainable growth. The situation is made more complex given the district’s (and state’s) performance on other fronts of human development (especially education and health). The issue of increasing numbers among the ‘educated unemployed’, decreasing numbers employed in the primary sector, reducing area for agriculture and primary activities, increasing population densities and rising land prices, stagnation in traditional industry and slow economic growth rates all add up to a set of problems that, even as they are atypical of the rest of the country, are uniquely typical of Kerala; and perhaps, the next generation of problems that some parts of the country may be set to face in the coming decades.

2.1. THE GROWTH POLE APPROACH

In the context of the overview of issues mentioned above, the Growth Pole Approach is seen as a viable concept through which the existing sectors/clusters could be re-energised through sector specific and cross-cutting infrastructural interventions.


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A Growth Pole “is an extension of the idea of clusters, based on the economics of interdependence of different producing units in a particular geographic concentration.. creating the scope of duplication and extension of the activities in larger contiguous areas” Source: NCEUS

The current situation of a slow down in the overall economic growth of the area, despite the presence of good human capital and the availability of diverse natural resources only reinforces the belief that an overall coordination failure may have crept in to stymie performance. The Growth Pole approach may be understood to be the set of strategies that is able to address this situation, restore and secure improved coordination and ensure (and demonstrate, in a viable and sustainable manner) future growth. However an essential caveat about the application of the concept

“…the conventional usage of the term ‘growth pole’ is an outcome-based classification of geographically concentrated economic activity. If concentrated growth is achieved in a geographical area, that area can be considered to be a growth pole. 1 In other words, the mere intention of generating high growth in a concentrated geographical area is not sufficient to classify that area as a growth pole. The sufficiency condition is the achievement of high growth.” from “Cluster Initiatives and Growth Poles: Correcting Coordination Failure” by Laveesh Bhandari, [Indicus Analytics] November 2006

The one-year project report submitted earlier already incorporated the idea of demonstrable outcomes and restoring improved coordination for improved economic performances and efficiencies; at the same time paying heed to the issue of negative impacts. This is further developed and integrated into this document, applying to the five-year programme period.

2.2. INTEGRATING THE PURA CONCEPT

Complementing the Growth Pole Approach and underscoring the idea of improvement in physical connectivities (road, knowledge, market etc) is the PURA concept, initially mooted and supported by His Excellency the President of India, Dr Abul Kalam and now incorporated with the Growth Pole Approach. 1 Growth poles themselves can have both positive and negative impacts on the surrounding areas and many have noted these possibilities. ‘The case of Paris shows that effect of polarization on the surrounding geographic area is not always positive. The attraction of Paris has been so great that it has been extremely difficult to promote any economic development in the area outside of the Paris region. French planning literature refers to this as the phenomenon of Paris and the French Desert.’ See Thayer Watkins, François Perroux's Concept of A Growth Pole, mimeo., Silicon Valley & Tornado Alley, USA. http://www.applet-magic.com/poles.htm.


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The following diagram illustrates the theme of multiple and linked connectivities envisaged under the PURA concept.

CONNECTIVITIES AND LINKAGES: PURA CONCEPT

2.3. OBJECTIVES OF THE KOLLAM GROWTH POLE PROGRAMME

The objectives for the Kollam Growth Pole Programme are based on the ones outlined by NCEUS; these though, have been detailed further to address the Kollam situation in particular.

• To develop a sustainable growth model for Kollam by: Focusing the unorganized/informal sector within the

specific geographical limit Adopting cluster model development of enterprises Integrating the various schemes Developing complementary clusters Aiming to enhance the income generation of the work

force in these sectors • To expand the production and employment in the unorganized enterprises

through clusters around selected existing clusters of industrial activities and services and encourage the formation of new clusters


5 KBIP, GoK

• To conduct a benchmark study on required technology interventions. entrepreneurship and latest trends in various major sectors in Kollam which has declined over a period of time and to implement the facilities required for improvement

• To provide assistance in the lagging areas and to improve their entrepreneurial skills

• For upliftment of the socially backward groups in the area; mostly women artisans/ workers Below Poverty Level (BPL)

• To integrate these unorganized units with the mainstream of the process of economic growth through the creation of markets and the use of market-related incentives

• To spread industrialisation throughout the country, outside the large industrial areas through the growth in the productivity and efficiency in the unorganised sector through small and micro enterprises and rural industrialisation

The above are objectives envisaged for the overall Kollam Growth Pole Programme. These were also used to provide guidance for the one-year project for which a document was submitted earlier.

2.4. METHODOLOGY

The methodology followed to undertake the exercise of preparing the Detailed Project Report for the Kollam Growth Pole is illustrated in the diagram below. The sector diagnostics, on-ground verifications and stakeholder consultations (including Focus Group Discussions) including primary surveys have been included in the overall assessment as well as sector assessments. The findings from these and other information collection exercises have been used to draft the overall all Growth Pole Strategy, in consultation with key stakeholder groups.


6 KBIP, GoK


7 KBIP, GoK

3. REGIONAL SETTING, DESCRIPTION OF AREA

The overall setting of the Kollam Growth Pole in terms of topography, and natural features, demographic and socio-economic growth trends is outlined in this section, to form a context for discussing the envisaged economic development through the Growth Pole Strategy.

3.1. LOCATION AND GENERAL FEATURES

Kollam is situated just north of Tiruvananthapuram district, which is the southernmost district of Kerala. It has a humid climate and the relative humidity varies from 63% in January to 87% in June and July. The hottest months are March, April and May, and the average daily maximum temperature ranges between of 32º C to 33º C. The temperature is lowest during January. The average annual rainfall is recorded at 2,779 mm. Rains during the months of May, June and July are brought by the southwest monsoon. The northeast monsoon brings heavy rain during the month of October.

KOLLAM GROWTH POLE AREA


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3.1.1. Demography and Growth Trends

Kollam district has an area of 2491 sq.km with a population of 25.84 lakh. The density of population in the district is 1,038 persons per sq.km, which is higher than the state average of 819 persons per sq.km. The table alongside shows that the district has a 6.4% share of the state’s area and an 8.1% share of the population. It is known that Kerala has higher than average rural population densities. This in turn makes for several issues like higher land prices in rural areas and less availability of land and space; issues in themselves, these have a further impact on the local and regional economies and patterns of economic development. The Growth Pole Area which includes 7 Block Panchayats, and Kollam Town, covers more of the coastal stretch of Kollam district that is even more densely populated, with some areas at over 2,500 persons per sq.km. [Ref Census Statistics in Annex 3-1] The rate of growth of population however, has become slower with fertility rates indicating below-replacement rates in the near future. In addition to stabilising the population (not including in-migration and out-migration) dependent on an area, this factor determines the dependencies of various cohorts with an increasing proportion of older population and a decreasing proportion in the younger cohorts. This has significant impacts on the employment/employability and economic development trends in an area

3.2. HUMAN DEVELOPMENT ASPECTS

The table that follows brings out a comparative assessment of key statistics relating to human development aspects. Comparisons are made (where statistics are available) to compare the status of the State with the rest of the country, Kollam district with the state of Kerala and the Growth Pole area with Kollam district and the rest of the state as well. To summarise, in comparative terms with the rest of the state, Kollam district

• is more densely populated (1038 p/sqkm), Kerala (819 p/sqkm) • has a lower decadal population growth rate (7.3%) Kerala (9.4%)


9 KBIP, GoK

• has the lowest IMR in the state with high figures for Institutional Deliveries (health indicator- child survival rate)

• records the highest life expectancy at birth (77.1) Kerala (74.6) (health indicator)

• has a high retention rate in schools (93.69%) Kerala (85.55%); literacy rates were at 91.5%, Kerala 90.9% (education related indicator)

The accompanying table further indicates Kollam’s good performance viz other health and education related indicators. These contribute significantly to the measure of Human Development

in an area as also to its development focus and priorities.

3.2.1. Socio Economic Aspects

Even as Kollam records impressive performance on the health and education fronts of development, the trends in terms of economic development are not as commendable.

11,92112,32818,517Per capita Income (in Rs)^

2,573

2.59

56.7%

54%

18%

28%

21.5% *

53.6% *

38% *

India

20.3%17.7%Contribution to Economy-Primary

22.1%20.2%Contribution to Economy-Secondary

57.6%62.1%Contribution to Economy-Tertiary

43.3%Credit-deposit ratio

Real per capita income (PPP$) ’01-’02

Road length per 1000 population (km)

Work participation rate (female)

Work participation rate (male)

Work participation rate

Indicators

2,8852,895

2.184.62

16.7%#15.4%#

48.5%#50.2%#

32.1%#32.3%#

Kollam(dist)

Kerala (State)

11,92112,32818,517Per capita Income (in Rs)^

2,573

2.59

56.7%

54%

18%

28%

21.5% *

53.6% *

38% *

India

20.3%17.7%Contribution to Economy-Primary

22.1%20.2%Contribution to Economy-Secondary

57.6%62.1%Contribution to Economy-Tertiary

43.3%Credit-deposit ratio

Real per capita income (PPP$) ’01-’02

Road length per 1000 population (km)

Work participation rate (female)

Work participation rate (male)

Work participation rate

Indicators

2,8852,895

2.184.62

16.7%#15.4%#

48.5%#50.2%#

32.1%#32.3%#

Kollam(dist)

Kerala (State)

* IEG (2004-05) #Kerala HDR 2005; ^at constant prices 2003-04

104710701058933Sex ratio (females/1000 males)

84.8%

54.2%

76.6%

65.4%

62

71

3.04

71

21.34%

324

India

-7.3 %9.42 %Decadal Growth Rate (2001)

-77.174.6Life expectancy at birth (2000)

91.82%91.5%90.9%Literacy Rate (Total)

94.79%94.6%95.2%Literacy Rate (Male)

-814IMR (deaths per 1000 births)

-1.61.7Fertility rate (per woman)

289364338No of beds per lakh population

89.05%88.6%88.3%Literacy Rate (Female)

Gross Enrollment Ratio

Population Density (persons/sqkm) [Rural/Rural+Urban]

Area (in sq km) [Rural/Rural+Urban]

Population (in lakhs) [Rural/Rural+Urban]

Indicators

-96.1%96.0%

1,865 / 2,7411,038819

233 / 291 2,49138,863

4.35 / 7.9625.84318.39

Growth Pole

Kollam (dist)

Kerala

104710701058933Sex ratio (females/1000 males)

84.8%

54.2%

76.6%

65.4%

62

71

3.04

71

21.34%

324

India

-7.3 %9.42 %Decadal Growth Rate (2001)

-77.174.6Life expectancy at birth (2000)

91.82%91.5%90.9%Literacy Rate (Total)

94.79%94.6%95.2%Literacy Rate (Male)

-814IMR (deaths per 1000 births)

-1.61.7Fertility rate (per woman)

289364338No of beds per lakh population

89.05%88.6%88.3%Literacy Rate (Female)

Gross Enrollment Ratio

Population Density (persons/sqkm) [Rural/Rural+Urban]

Area (in sq km) [Rural/Rural+Urban]

Population (in lakhs) [Rural/Rural+Urban]

Indicators

-96.1%96.0%

1,865 / 2,7411,038819

233 / 291 2,49138,863

4.35 / 7.9625.84318.39

Growth Pole

Kollam (dist)

Kerala


10 KBIP, GoK

To outline (see table alongside): • Work force participation rates have not improved in the last decade with

male work force participation rates (48.5%) lower than those for Kerala (50.2%) and women’s work force participation (16.7%), marginally higher than the state’s at (15.4%)

• Remittances in cash from abroad in ’98 were Rs.2864 million, at Rs 25,111 per emigrant working out to Rs 1,154 per person

• Low numbers involved with primary activities, less than 24% • Real per capita income (’01-02) was 2,885 (PPP$) Kerala 2,895 (PPP$)

In addition, specific trends in the Net Domestic Product (NDP) of the District are given in the table below

Source: Final Report: Kerala Sustainable Urban Development Project (PPTA 4106 – IND); May 2005- Govt of Kerala, Local Self Govt Dept. The following observations are made on the basis of the preceding figures:

• The primary sector has shown a substantial decline and the trend appears to continue

• Average annual growth in the secondary sector for the district is 2% and is less than the State’s growth in the corresponding sector (2.8%).

• Growth trend in tertiary sector for the district (9.6%) is marginally higher than the State’s growth in the same sector.

• Notably, the contribution of the tertiary sector to the district’s economy is significant with 54% in 2002-03; this may be attributed to the presence of the service sector in Kollam town.

The share of sectors in the district NDP indicate a decline in primary sector share, stable/constant share for the secondary sector and an increase in tertiary


11 KBIP, GoK

sector share for the assessment period. These trends indicate growth in the district that is in line with the structural pattern of a developing economy.

3.2.2. Industrial Performance

“Kollam District witnessed a marginal growth in working factories during the year 2000-2003. The annual average growth of registered factories in Kollam District was 6.2% for the period 1995-2002 and is greater than the growth in registered factories across the State (4.9%); the employment growth in Kollam District is marginally higher than that of the State average. During the period 1995-2002, the district share of registered factories and employment in the State was about 10% and 31%, respectively. Small-scale industrial units registered in Kollam District along with their associated investment size and employment provided have decreased in 2002-03, which is similar to the trend at the State-level. The Economic Review, 2003, reveals that the average growth of registered small-scale units in Kollam District compared to that of State is declining whereas employment provided in Kollam District (1.5%) increased in comparison to the decline at the State (-24.3%).”# The traditional handloom products of Kerala are popular in the region and this sector employs about 175,000 persons; it is the second largest employer after the coir industry, among the traditional based industries of the State. Kollam District has about 79 handloom cooperative societies, which constitutes 10% of the State’s handloom cooperative societies, and this share was relatively constant during the period 2000-03.

3.3. INFRASTRUCTURE AND LINKAGES

A recent planning document prepared for Kollam District highlights some interesting trends in the area that have a bearing on infrastructure and linkages, even as these aspects possibly give rise to these trends, in the first place: “From the study it can be concluded that the level of urbanization of the State shows a declining trend in general. Kollam District shows even a less level of urbanization when compared to the State average. And also, the level of urbanization shows a declining trend within the District. The urban areas of the district shows lower growth rate of population whereas the rural areas surrounding the urban areas show significantly higher growth rate indicating possible out migration of people from the urban areas to the surrounding rural settlements.”°°

# Source: Final Report: Kerala Sustainable Urban Development Project (PPTA 4106 – IND); May 2005- Govt of Kerala, Local Self Govt Dept. ° Source: Preliminary IDDP Report (Draft) 2006


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The ramification of these assessments and forecasts on aspects of infrastructure, are manifold. Fairly even levels of infrastructure services would support such trends. Social infrastructure has been found to be satisfactory in the Growth Pole area and Kollam district as well. While the levels of service of physical infrastructure are not at great variance between rural and urban areas, supporting the trends discussed above, their overall performance is far from satisfactory. An assessment of key aspects of physical infrastructure in the Growth Pole Area, with a focus on Kollam Town, is discussed below. Kollam Municipal Corporation alone accounts for 78% of the urban population in the District. Kollam Development Authority (KDA) area encompasses the Municipal Corporation area and adjoining nine Gram Panchayats. The total area under the Municipal Corporation jurisdiction is 57.31 sq. km and the area under the Panchayats is 155.53 sq. km. All these fall in the Growth Pole area, explaining the focus on Kollam Town, in the discussion on infrastructure. Furthermore, the problems in the Growth Pole arising out of dumping of untreated liquid and solid waste are directly related to the lack of organised and sanitary waste management systems in Kollam Town (Ref also made to these issues in sections on Key Sectors)

3.3.1. Social Infrastructure

Statistics on the performance on social development indicators has demonstrated that the area also has good support from social infrastructure, in the Growth Pole area, in terms of health and education (See GP-wise details on Education and Health Infrastructure in Tables in Annex 3-2).

EDUCATION

Schools exhibit a healthy enrolment and retention rate up to secondary education. However, from the higher secondary level the dropout rate is high, especially among the poor. Physical facilities like school buildings, furniture and equipment, sports facilities, toilets, drinking water, etc., are known to be much better than anywhere else in the country. “Around 85.2 per cent of the Government schools have good quality building (pucca building), 89 per cent of schools have drinking water facilities and 82 per cent of schools have urinal/ latrine facilities in Kollam”#.

# Source: Kerala Human Development Report 2005


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NO. OF SCHOOLS (GOVT.) HAVING PUCCA BUILDINGS, 2001 (%)

District Lower Primary Upper Primary High School Total Kollam 83.3 80.6 96.0 85.2 Kerala 85.3 81.7 74.5 82.2

ANCILLARY FACILITIES IN GOVT. SCHOOLS, 2001

Drinking Water (%) Toilet/Latrine (%) District Lower

Primary Upper Primary

High School

Total Lower Primary

Upper Primary

High School

Total

Kollam 87.4 95.2 92.0 89.4 79.9 83.9 89.3 82.3 Kerala 87.3 90.0 91.2 88.7 69.6 79.1 80.1 73.9

Source: Kerala Human Development Report 2005

HEALTH

A recent survey∗ conducted in the area brought out that 73% of respondents across all categories were satisfied with the current health services. Linkage infrastructure, which includes a good road and transport network, are also reported to be good, facilitating easy movement of goods and people within and around the area.

3.3.2. Physical Infrastructure

ROADS

District wise and category wise length of road maintained by PWD 1-04-2003 & 1-04-2004

District SH MDR ODR VR Total Kollam 90.68 1,265.88 123.46 6.90 1,486.93State 3,784.72 11,711.26 5,315.52 655.99 21,467.49

District wise and type wise of Panchayat Roads as on 31/3/01 & 31/3/02 (in km)

District Cement concrete

Black topped Metalled Gravelled /

Earthern Total

2001 2002 2001 2002 2001 2002 2001 2002 2001 2002

Kollam 45.6 86.4 1,336.2 1,711.1 468 214.5 5326.5 5782 7176.3 7794.0State 398.7 681.1 21,067.3 23,201.6 11,288.1 10,661.9 54,339.7 55,540.8 87093.8 92084.2

Source: PWD

∗ Survey conducted as part of the project preparation exercise for the proposed ADB assistance for Urban Infrastructure development Source: Final Report: Kerala Sustainable Urban Development Project (PPTA 4106 – IND); May 2005- Govt of Kerala, Local Self Govt Dept..


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The area shows a dense concentration of roads (compared to national standards) and a recent survey* recorded 71% satisfaction of people with public transport system but only a 50% satisfaction level with road condition.

WATER SUPPLY

In Kollam, 92.3 per cent of the population has access to water within a 100 Metre Distance from their homes. While this makes for favourable comparison with the rest of the country, there are aspects of adequacy that require to be addressed in the context of the Urban areas and issues of bacteriological and chemical safety of the water (in terms of quality), in rural areas. In Kollam town, though nearly 98% of the population might have theoretical access to piped water supply, in reality, many have to rely on water from shallow wells which is often saline or contaminated. After offsetting the losses in process and distribution the present per capita availability of water to Kollam with only one WTP in operation is about 40 lpcd and in the adjoining Panchayats the supply is about 25 lpcd.(as against national supply norms of 120 lpcd for urban areas and 40 lpcd in rural areas—norms recently revised to 135 lpcd and 70 lpcd, respectively) The supply and distribution networks damaged during the Tsunami are currently under rehabilitation and repair in some areas in the Growth Pole and supply norms have taken into account provisions as per the revised supply norms. These are underway in Allapad and Karnagapally GPs. With assistance from the Tsunami Emergency Assistance Programme of the GoK and ADB. In addition, the proposed Urban Infrastructure Improvement Project for Kollam town(ADB supported) plans investment in the sector to optimize the present water supply system by providing a more cost effective production and delivery of water to a level adequate for providing sewerage in the densely populated areas of the city with the ultimate aim of providing a 24-hour water supply.

AshrayaThis scheme, which is a special programme for the destitute, was initiated in 101 village panchayats and subsequently extended to 46 more. The neighbourhood group of the Kudumbashree identified destitute families and trained volunteers to interact with the families to prepare family-based micro plans. Destitute families are the ones which fulfil seven of the following nine criteria: (i) Kuchcha houses, (ii) No access to safe drinking water, (iii) No access to sanitary latrine, (iv) Illiterate adult in the family, (v) Having not more than one earning member, (vi) Getting barely two meals a day, (vii) presence of children below 5 years, (viii) Alcoholic or drug addict in the family, and (ix) Scheduled caste or Scheduled tribe family. The scheme proposes a continuous hand-holding of the family till it comes out of destitution and monitors its progress. Source: Economic Review (2003: 304)


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“However, KSUDP also recognizes the importance of protecting Sasthamkotta Lake and proposes that the water supply to Kollam Corporation area can be improved without additional water extraction or treatment, through:- a) Reduction of UFW and losses through leak detection and rehabilitation of the water distribution system; b) Increasing direct household connections and reducing need for public standposts; and c) Optimization of treatment and distribution through system hydraulic analysis, water and power audits with improved operations management procedures to ensure maximum efficiency and economic production and delivery of water to customers.” Supply of clean drinking water is also required for various stages of fish pre-processing and processing. Even as this function is located on the outskirts of Kollam Town, the proposed water supply project only takes into account the requirement of domestic water supply. An overhead storage tank has been constructed near Thangassary towards this requirement, however, its distribution network is yet to be laid out, for the proposed beneficiaries to be able to take advantage of it.

SEWERAGE, DRAINAGE AND SANITATION

Sewerage Arrangements There is a non-operational sewerage system in Kollam. KWA had prepared a scheme for providing underground sewerage and sewage treatment for Kollam Municipality in 1975. The scheme envisaged covering the old Municipal area of 18.48 sq. kms. The project divided the Municipal area into 11 zones and proposed a collecting well and pump house for each zone. From the collecting well the sewerage was to be pumped to the proposed sewage treatment plant (STP) at Kureepuzha. “Though the work on the scheme was started in 1980, only 38 kms of sewer and 3.35 kms of pumping mains were laid in Zone III, IV, V and VI. Stoneware pipes of diameter 150-300 mm were used for the sewers. No work has been done so far on pumping stations and sewage treatment plant. However land for four pumping stations in zones III, IV, V and VI was acquired by KWA and land for the STP at Kureepuzha has recently been acquired by Kollam Municipal Corporation.” Existing Sanitation System Existing sanitation facilities in Kollam mainly consists of individual septic tanks generally in middle and high-income residential areas and shallow pit latrines in areas with lower income groups. Sullage from houses is discharged into roadside drains and into the TS canal, which crosses the city from North to South.


16 KBIP, GoK

Household surveys undertaken by the Municipal Corporation under NSDP programs to identify the households below poverty line, reflects that almost all wards have some households, which do not have access to any form of sanitary facilities. In the worst affected areas 30-40% of households are without access to any sanitary latrine. The Department of Town & Country Planning (TCP), GoK, identified 25 slums in the city that have a population of 13,711. Of the total households (2,660) in slums, 60% do not have access to individual sanitary facilities. Sanitation improvement in slums/urban poor areas was initiated under NSDP. Out of 15,407 BPL families identified by Municipal Corporation under NSDP, 870 households have so far received assistance at the rate of Rs.2,000 for constructing individual Twin Pit Pour Flush Latrines (TPPFL). Drainage and Liquid waste disposal Most of Kollam’s wastewater flows un-treated into Ashtamudi Lake, part of the Ashtamudi Wetland, which is registered as a Ramsar Site and is recognized internationally as an area of environmental importance and in need of protection. By declaring the wetland area a Ramsar Site special attention is being given to protect the lake. The conservation zones proposed in the environmental management plan for the Ramsar nomination cover more of the non-urban areas near the lake and do not cover the urbanized areas of Kollam. The part of the management plan which pertains to the urban area, is by way of down-stream impacts from waste disposal. This is captured in the objective "to create improved sanitation, reduction of industrial growth, reduction of urban waste and ensuring the sustainability of the water quality of the estuary". This objective, however, covers thee non-urban areas dumping waste into the lake areas too. Considering the present and future water supply demand projections, and contemplating a planned underground sewerage system in future, the Municipal Corporation area alone will be producing approximately 45 MLD of wastewater for which no sewage treatment facility exists. Given that the only option to deal with the above situation is to have a comprehensive sewerage system for the whole corporation area for which the implementation could be carried out in phases starting with the old municipal area of approx. 18.48 sq. km. This becomes an important part of ADB’s proposed programmed with Kerala government, to address urban infrastructure issues (Kollam Municipal Area being one of the project towns) The assessment in the Project Preparation report# for the above project lays out: “The sewerage and sanitation issues to be addressed through short term and long-term measures are as follows:

# Source: Final Report: Kerala Sustainable Urban Development Project (PPTA 4106 – IND); May 2005- Govt of Kerala, Local Self Govt Dept.


17 KBIP, GoK

a) Location and condition survey, rehabilitation / replacement and commissioning of the existing sewers (38 km) in the old Municipal area, plus construction of sewage pumping stations; b) Construction of a Sewage Treatment Plant for the old municipal area and extension of the sewerage system in other parts of the Municipal Corporation; and c) Sanitation improvements in areas not covered by the sewerage scheme, especially in slums through the on-going NSDP program to reduce pollution of the TS canal and other water bodies. The sewers already laid in the central city area need to be surveyed to ascertain the present condition and adequacy before commissioning; some may need to be rehabilitated or replaced. Also the sewage pumping stations are to be constructed and commissioned. Sewage from the corporation area needs to be properly treated before disposal. Treatment of sewage is possible by both off-site and on site methods. Off-site treatment is economically viable in areas with high population density (old municipal area) with sufficient water supply provisions. KWA had planned and laid these sewers in such a way that sewage is collected and treated at the proposed STP at Kureepuzha. The full coverage of sanitary program under NSDP in slum areas is not completed and should be carried forward. There are 2,660 households in slums out of which approximately 60% do not have access to individual sanitary facility. However, the possibility of connecting all slum houses to the proposed sewerage system is minimal; hence majority should be provided with TPPFL depending upon the availability of space. Thus, 1,500 households are considered for inclusion in the sub-project for the provision of individual TPPFL. Schemes proposed, based on these assessments have been incorporated into the Growth Pole Programme, given their multi-sector impacts. Fisheries (both inland and marine), Tourism and Coir retting are sectors set to be directly benefited from the implementation of these improvements. The small craft fisher folk and (fishing) communities that dwell along the lake side and along the coastline most near the town, are the worst affected of the lot, both economically and on health fronts, because of this problem. More localised treatment or discharge of sewerage is required at the level of the Rural Gram Panchayats too. A recent study* conducted in the area of water and sanitation brought out that whilst Kerala had one of the highest reported figures for access of rural population to toilets (81%), there was a much lower figure reported for people actually using the facility (41%), preferring to defecate in the open. Addressing the problem would have to start with the wider program of not just provision of basic safe sanitation facilities at the house-hold level but getting

* Consultancy support to government of Kerala to enter into an MOU with GOI on institutionalising reforms in the rural water supply and sanitation sector (April 2005)


18 KBIP, GoK

across the message of its hygienic and sanitary use and its linking-up to a safe disposal system.

SOLID WASTE MANAGEMENT

Kollam town is producing an estimated 110 MT of solid waste daily. This solid waste, in addition to the waste being produced in the adjoining areas , is presently being dumped at the 1.8 Ha., Kureepuzha open dumping ground which is adjacent to the Ashtamudi Lake, an internationally recognized Ramsar wetland area. The operations are not engineered or properly controlled which results in leachate and wind blown waste polluting the lake. Immediate remediation action is therefore required. “The site which only has capacity for a further eight years should be re-engineered to contain the existing stored waste to prevent further seepage of leachate.” A composting plant should also be provided to reduce the organic content of the waste to be disposed off. Kollam MC has recently reviewed two proposals submitted for integrated solid waste management system, which includes a compost plant and a scientific landfill. Further action regarding this is underway. Bio-Medical Waste, Hazardous Waste Kollam Town has a concentration of medical and health facilities, sources that generate a category of waste deemed hazardous: Bio-medical waste, and covered under the treatment norms proposed in the country. There are 44 private clinics, hospitals and nursing homes within Kollam Town. Two hospitals (i.e., the Government Hospital and the ESI hospital) have incinerators installed within their premises and the entire clinical waste generated in the city is disposed here. Kollam MC does not collect or dispose of any biomedical waste from the other facilities making for a hazardous scenario at the dumping site, where this waste is presumably making its way, through the municipal waste system. Other settlements in the Growth Pole are too, do not have systems to manage the domestic solid waste and waste generated in the “hazardous” category. Fish waste and waste produced from fish processing activities too, qualifies as ‘hazardous’ and needs special treatment.

3.4. BANKING INFRASTRUCTURE AND CREDIT

The state of Kerala, though considered a model state on most of the social indicators, does not compare well in terms of industrial development. The Credit Deposit Ratio (CDR) of Scheduled Commercial Banks is considered a reliable measurement of industrial growth in a state as it truly reflects the scale of capital investment. Kerala had a CDR at around 62 as on March 31, 2006 which is low


19 KBIP, GoK

compared to the neighboring states like Tamil Nadu (106), Karnataka (77) Andhra Pradesh (82) and Maharashtra (102). The district of Kollam though had a CDR at 66 on March 31, 2006, higher than the state average of 62. The district accounts for around 5.6 % of total advances and around 7 % of priority sector advances of the state. The district of Kollam has an extensive banking network with 199 branches of 29 commercial banks, 55 branches of district central cooperative bank and 121 branches of primary agricultural cooperative societies. The commercial banks account for 65 % of total loan outstanding in the district. Indian Bank is the Lead Bank of the district with 20 branches. Other major commercial banks in the district are State Bank of Travancore with 39 branches, Federal Bank with 27 branches, Central Bank of India with 12 branches, Canara Bank with 11 branches and State Bank of India with 9 branches. .

SHARE OF BANKS IN LOAN OUTSTANDING

Loan Outstanding** Agency No of branches 31.3.2004 31.3.2005 31.3.2006

% share as on 31.3.06

1 Commercial Banks 199 205,788 (15.7%)

261,057 (26.9%)

296299 (13.5%)

65.1

2 District Central Cooperative Bank

55 35,006 (12.4%)

46,272 (32.1%)

58766 (27.1)

12.9

3 Primary Agricultural Cooperative Societies

121 63563 (22.1%)

76,275 (20%)

90004 (18.0 %)

19.8

4 Primary Cooperative Agriculture and Rural Development Banks

7 9,474 (1.1%)

9,853 (4%)

10390 ( 5.5%)

2.2

Total 382 313831 393457 455459 100.0 Source : NABARD PLP 2007-08 **(In Rs. lakh)

(Figures in bracket indicate growth over previous year)

ADVANCES BY COMMERCIAL BANKS IN KOLLAM (MARCH-2005)

Total Advances (Rs. '000) 26105676

(In Descending Order) Name of Bank Advances(Rs. '000) Share in Advances (%)

State Bank of Travancore 6485256 24.84% Federal Bank 3010443 11.53%

State Bank of India 2979576 11.41% Indian Bank 2038586 7.81% Canara Bank 1560908 5.98%

South Indian bank 1321784 5.06% Vayasa bank (VYB) 1073053 4.11%

OTHERS 7636070 29.25% 70.75%


20 KBIP, GoK

3.4.1. Micro Finance

Micro finance has taken root in the district; there were 7981 credit linked SHGs in Kollam district (as on 31 March 2006), with bank loans of Rs 45.77 crores (cumulative). The number of SHGs credit linked in Kerala as on 31 March 2006 was 87000 groups with bank loans of Rs 232.59 Crore. The district economy is mainly based on cashew, plantation crops and fisheries. In particular, cashew sector plays significant role in banking sector of the industry. Within the Growth Pole Area, from the point of view of credit and micro-finance, the significant areas are cashew processing, fisheries and coir.

3.5. OVERALL SCENARIO

Given its particular kind of development, the district presents the following overall scenario for development:

• High performance on Human Development indicators, especially health and education with median to lower performance against economic development aspects

• Lower or stagnant growth rates for industry (traditional industry) • No improvement in work force participation with issues of educated

unemployed set to increase in the near future, given demographic trends. • Lower performance in new industrial development • Issues of wage rates across traditional industries posing barriers to new

entrants to traditional sectors • Lack of physical infrastructure support, specially to do with efficient waste

disposal (liquid and solid) is having negative (economic and health) impacts across a number of sectors, in addition to overall environmental damage.

Sector specific issues are taken up in the sections that follow.


KBIP, GoK

Part II

• Sectors Cashew

Fisheries Coir

Tourism and crafts

• Cross-cutting Issues:


KBIP, GoK 21

These sectors account for about a third of the total population in the Growth Pole Area and reportedly, a large share of the working population.

4. KEY SECTORS

4.1. OVERALL BACKGROUND

It is estimated that the total population within the Kollam Growth Pole Area is about eight lakh persons. Taking a worker participation rate* of 32.1 % (for Kollam district) and comparing it with the proportion of the total population involved with the three key industry sectors within the Kollam Growth Pole area (31%) we get a near total representation, indicating that these sectors corner a lions share of the total working population of the area.

Cashew Processing is the dominant sector in the economy in terms of employment, turnover and exports. The fisheries sector (Marine and Inland) is a significant employer and also has a notable turnover. Coir, though reportedly employing a large number of workers (registered members of cooperatives and weaver groups), due to the low wages offered, has seen a large drain of workforce into other sectors, most significantly Cashew. Official recorded numbers have not noted the change as the persons retain their memberships of the cooperatives.

* Source: Kerala Human Development Report 2005

GROWTH POLE Employment Units Turnover ExportsRs Cr Rs Cr

FISHERIES 36,186 NA 928 212CASHEW 176,632 614 2,007 1,544COIR 34,218 9,390 58 10


KBIP, GoK 22

This section comprises four key sub-sections that cover the four main sectors in the economy:

• Cashew Sector • Fisheries Sector (Marine and Inland) • Coir Sector • Tourism Sector

Each sub-section is organized to cover sector assessments and profiles, gap analysis and identification of sector potential. Following this, and based on it, the overall sector strategy is outlined with details of proposed interventions. Where applicable, locations and other details are also identified. A summary of financials for the sector is included. A number of exercises have been carried out in the course of conducting the sector assessments:

• Review of secondary literature—commissioned studies, policy documents, documents from government departments, regulatory reviews, sector related documents from other contexts etc.

• Primary interactions with stakeholders: interviews and structured discussions, focus group discussions and community consultations, meetings and interactions with government stakeholders, primary surveys in six Grama Panchayats.

The overall aim is to achieve the following in the Growth Pole, through involvement of the key sectors.

• Improved economic performance • Improved worker-environment and wages • Sector streamlining

With these overall targets, primary interactions and surveys were conducted in the sectors and at village level, to assess feedback on the prevailing conditions, nature of involvement with the sector, key expectations, concerns and issues, future outlook etc.

4.2. PRIMARY INTERACTIONS

A brief summary of findings from the primary surveys in the Growth Pole Area is discussed in this sub-section.


KBIP, GoK 23

The table contains the 14 Grama Panchayats ( and Kollam Corporation) as comprising the Kollam Grow Pole Of these, six Grama Panchayats were selected in consultation with the Kerala Government representatives, based on the criteria of representation, concentration of sector activities, and size. The selected area along with the number of respondents is given in the table below:

SURVEY COVERAGE:

Households covered About 6% of total (Total estimated 1,77,024) Total No of Persons covered About 5% of total (Total estimated 7,96,687) Grama Panchayats covered 6 out of 14

Some key findings from the survey are shown here*. The figure alongside shows that in addition to a high level of literacy, the degree of educational attainment too, is fairly high. In five of the six Grama Panchayats surveyed, more than 40% of the respondents had education qualifications at levels higher than secondary- level. This aspect has been discussed in the previous section and its impacts on the industry have so far been an increasing reluctance amongst the younger entrants into the workforce, to become involved with certain types of work. On the other hand, given the higher levels of education, the people are in a position to and keen on taking on more service-related work, at other levels.

* Detailed survey tables included in annex

Kollam Growth Pole: List of GPs1 Karunagappally 2 Kunnathoor 3 Sasthamkotta 4 Neduvathoor 5 Kottarakkara 6 Kundara 7 Perinad 78 Chavara 9 Thekkumbhagam 10 Neendakara 11 Thrikkaruva 12 Thrikkadavoor 13 Elampalloor 14 Mayyanad 15 Kollam Corporation

Sl.No GP name Number of

Respondents1 Chavara 1727 2 Elampalloor 1605 3 Kundara 1675 4 Perinadu 1687 5 Sasthamkotta 1677 6 Thrikkadavoor 1609

Total 9980

0

1000

2000

3000

4000

5000

6000

7000

8000

Surveyed Gram Panchayat s

OthersProfesional DegreeM asters DegreeBachelors CommerceBachelors ScienceBachelors ArtsIntermediateHigh SchoolSecondaryPrimary


KBIP, GoK 24

Given the combination of work undertaken by members of households in rural areas, this area too shows that people are involved with several types of activities, though their dependence on one kind of work may be much higher than other kinds. In that sense, the supplementary activities continue and cumulatively still contribute to the development and experience of the area. The figure alongside shows the combination of key activities and the significant tilt towards the key sectors of Cashew, Fisheries and Coir, in the Growth Pole Area. Figures collected regarding the number of employees in the sectors also bring out the same point, of the high degree of representation of these sectors in the Kollam Growth Pole. Further, the involvement of people with these key sectors is shown in the figure below, which emerges as the current primary activity

among the persons surveyed. It had emerged from consultations that the number of people involved with cashew processing was increasing while the number of people previously involved with coir used to be much

higher than it was today and that this sector was seeing a sharp decline. The Primary survey too brought out that coir had fewer persons involved except in one Grama Panchayat. Fishing continues to be a sector with a large number of persons involved though this has had its ramifications in terms of over-fishing and its attendant issues like declining fish-catch, poorer quality, ecological problems, certain species becoming endangered etc. These and other industry specific issues are taken up sector-wise, in this section.

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AgricultureFish, Cashew, CoirServicesBusiness

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KBIP, GoK 25

4. A. CASHEW SECTOR

Cashew was introduced in India in the 16th century to prevent soil erosion. Later it spread as a popular crop to other parts of the South Western and South Eastern parts of India. The cashew cultivation in India now covers a total area of over 0 .7 million hectares of land, producing over 5.2 Lakhs M.T. of raw cashew nuts annually. Major shipments from this region (through Kochi port) go to importers in USA, Canada, Japan, Middle-East, Singapore, Australia, UK, and other EU Countries. India is the largest producer and exporter of cashew kernels in the world. The Indian cashew kernel is acclaimed for its better quality and taste. About 60% of the exports from the country take place from the Kollam cashew processing cluster.

4.1. CLUSTER PROFILE

The cashew cluster in the area has a total turnover of Rs. 2,440 Crores. Of this reportedly, Rs. 1,544 Crores is from exports and the rest is sold in the domestic market. The total raw cashew processed is about 4.21 lakhs MT per annum. The cluster has been growing in terms of turnover at the rate of about 9% per annum. The cluster comprises two key production distribution channels. These include integrated large and medium processors targeting the export markets. Turnover of such enterprises varies from Rs. 40 Crores up to Rs 220 Crores. There are 5-6 large players with turnover in the range of Rs 100-200 Crores and about 20 medium sized processors with turnover in the proximity of Rs. 50 Crores. The smaller and tiny cottage processors, largely targeting the domestic market, is the other key production distribution channel. They also process for large enterprises on sales contract basis. The large and medium enterprises are integrated backwards to the extent of procurement directly from raw cashew supplying area in India and abroad. They also have established strong domestic and international marketing linkages. However, smaller and tiny cottage processors are largely dependent on traders both in the input procurement and marketing front.


KBIP, GoK 26

4.2. PROCESS PROFILE

There are several stages in the processing of cashew from the stage of the raw nut to the final product, which have come about, based on many previous experiments with alternatives and introduction of tooling and technology, over the decades. Today the dominant process chains are either based on Drum Roasting of the raw nuts, or Steam Boiling/Cooking. The basic process and how these stages came about, have been described below. In order to extract the kernel the shell has to be conditioned in some way in order to fix or remove the liquid in the pericarp so that the kernel may be removed without being contaminated in any way by the liquid. It was found that the shell became brittle and the kernel could be removed by striking the nut with a wooden batten. When the shell split down the natural line of cleavage and the kernel could be removed without contamination. The kernels were sold as shelled kernels and many were purchased by other processors to augment their own processed kernels. A further method has been developed whereby the nuts are subjected to very low temperature treatment and this embrittles the shell. After low temperature treatment the nuts are cut mechanically along the natural line of cleavage to remove the kernel. The shells are sent for further treatment to remove the liquid. This method is now used commercially. From the earliest time of processing either for personal consumption or as a commercial proposition it is a practice to remove some of the liquid in the pericarp by burning it off and thereby render the shell brittle. This approach has been employed wherever the nut has been produced and is still employed on both the small as well as the large scale. The kernel is then removed by striking the roasted nut with a wooden batten, when the nut splits down its natural line of cleavage. The kernel removed from the shell has to be treated further to remove the testa, grade the resultant product before packing and shipment. Generally, the processing operation on cashew nuts may be described as below:

1. rendering the shell brittle (roasting/cooking) 2. shelling 3. peeling 4. grading 5. packing

(See process diagram) Many of the existing factories have expanded over time with the development of various techniques and for this reason, do not represent the ideal layout of a


KBIP, GoK 27

factory. In some cases, buildings have been used because they were there and adapted for use as a cashew factory. By far the greatest quantity of cashew nuts is still today processed by what is known as the “manual method” i.e. the shelling, peeling and grading operation is done by hand. Where crops are small this is the only viable approach, as mechanical equipment for the shelling and peeling operation is costly and is financially justifiable by a high volume of through-put. Another factor determining the choice of process is the preference, based on the taste of drum roasted cashew. Over several decades, this process along with the distinct taste of drum-roasted cashew, have become the hallmarks of “Quilon Cashew”.

4.2.1. Description of the various stages of Cashew Processing:

Cleaning, sizing, conditioning All raw nuts carry with them foreign matter consisting of sand, stones, dried apple etc. the first operation therefore is cleaning In a very small scale plant the raw nuts can be sieved by hand on a 3/8 inch mesh sieve and the undersize will be dirt and dust. String straw can be readily seen in the sieve and removed by hand. It will be seen then that dry nuts will be more prone to kernel damage than nuts of higher moisture content. It is therefore normal practice to add water to the dried nuts to such an extent that the kernel will be protected when subjected to high temperature treatment.

Procurement of Un-dried Nuts

Sun Drying

Storing

Steam Boiling

Borma Drying

Cooling

Peeling

Grading

Borma Drying

Conditioning

Sieving

Filling

Weighing

Packing

Sealing

Stacking

Master Packing

Dispatch

Carbon Dioxide

Gas

Drum Roasting

Mechanized CuttingManual Shelling

CoolingCooling


KBIP, GoK

CASHEW PROCESSING: (TRADITIONAL METHOD- DRUM ROASTING)

1. Cashew – before roasting 2. Drum-Roasting process

4. Manual shelling 3. After roasting

5. Further drying in the “Borma” 6. After removal from the “Borma”

7. Removal of testa and grading8. For grading and sorting, and subsequently, packing


KBIP, GoK 29

Sizing has only been mentioned in the passing. However in the oltremare process this is done with large sizing trammels where the nuts will pass through holes of a specific size. The oversize ones pass to a trammel of different calibration Roasting and centrifuging The term roasting when applied to the raw cashew nut means any process involving the application of heat to the raw nut in order to release liquid in the per carp to remove the liquid so that the shell becomes brittle and facilitate the extraction of the kernel. Centrifuging applies to the centrifugal treatment of the roasted cashew nut to remove any surface liquid, which may be adhering to the nut. Methods of roasting: Open pan The pioneer processors of Kollam without exception started their commercial operations based on the open pan method of roasting. However with time roasting became centralized in a factory and this was possible through a change in the method although basically the principle was the same. Methods of roasting: Drum Roasting This is the process of roasting that Kollam is well-known for and is typical to the area. In drum roasting the raw nuts are fed continuously in to cylinder slowly rotating over a fire with a slight slope on the cylinder to ensure movement of nuts along it. The drum is pierced and by regulating the speed of rotation the time of retention in the drum is controlled. The whole heating system is covered with a hood connected to a chimney and in this way the smoke is let up into the air. Water spraying devices are fitted to provide for dowsing the nuts at the discharge end. Originally most of the drum roasters were rotated manually, however some have incorporated a power drive in recent years. Shelling Manual shelling has been the practice in all cashew processors in this area. The objective is to produce whole kernels free from cracks, that are clean. The equipment required for manual shelling are:

• Tins for shelled kernels and shelled pieces. • Shelling mallet. • Shelling table with striking post. • Adequate quantity of wood ash. • A scraper for cleaning mallet and striking post.


KBIP, GoK 30

The success of the cashew industry largely depends on the proportions of kernels produced in the shelling operation. The shelled kernels have a moisture-content of over 6% and are susceptible to fungal attack. It is therefore imperative that the shelled kernels be taken for drying immediately after shelling. The shelled kernels are susceptible to infestation and this is another reason for immediate drying. Drying and Peeling The shelled kernel is covered with the ‘testa’ and needs removal, ie. to peel, to produce the blanched kernel. After drying the shelled kernels, it shrinks so that the testa is loosely adhering to it and can be removed by hand, with the aid of a wooden or metal knife or by a mechanical means. The bormas are used for drying kernels. The peelers separate the peeled kernels into certain grades.

1. White wholes. 2. Scorched wholes. 3. White butts. 4. White splits. 5. White pieces. 6. Scorched pieces. 7. Brown. 8. Refuse.

Grading Kernels are graded manually into 26 commercially available grades that are exported. Broadly, these are as follows:

Wholes (W)

Scorched Wholes (SW)

Brokens Scorched Small Pieces

W 180 SW 180 White Pieces. W 210. SW210. B --Butts SB --Scorched Butts W 240. SW240. S --Splits SS --Scorched Splits W 320. SW320. LWP --Large White Pieces SP --Scorched Large Pieces W 450. SW450. SWP --Small White Pieces. SSP--Scorched Small Pieces. W 500. SW500. BB --Baby Bits

The grading operation is the most important since this is the last check on the quality of the merchandised being packed. After grading the moisture content of the kernels must be checked as kernels for shipment have to arrive safely from

During Shelling, the following must be reduced or eliminated. • Pieces • Dirty pieces. • Broken wholes. • Cracked nuts. • Pieces and whole kernels

going out with the shells. • Stealing of shelled nuts. • Shells going out with the

kernels.


KBIP, GoK 31

several aspects. The moisture content therefore after grading is most important, as below 4% moisture the kernels are too brittle and will break in transit. Above 6% is critical for mould growth. So, it is necessary to pack the kernels with moisture content in between 4-6%. Packing Cashew kernels are normally shipped after being subjected to the “vita pack” process. This consists of removing all air from the tin or pouches and substituting this with carbon dioxide and sealed air tightly. The advantage of packing cashew kernels in carbon dioxide is that carbon dioxide is an inert gas and prevents infestation (the main insect pests are ants, grain weevils, meal moths etc.).

4.3. PRODUCT PROFILE

The average cost of raw cashew is Rs. 35/Kg. The main processes involved in cashew processing are Roasting Shelling Drying in Borma Peeling Grading, packing etc. The average cost involved in the above process is Rs. 13.50/Kg. The average yield while processing cashew is 26.3% i.e 263 gms of cashew kernels is derived from 1 Kg of raw cashew. The average selling price is Rs. 200/Kg.The net value addition derived is Rs. 4.10/Kgs. In an average value addition is 11.7%. The indicative cost structure (annual cost of production) of enterprises in the region is as follows: Raw material cost (66.5%), processing (25.7%) cost and other overheads (5%). About 13% of raw materials available from India is contributed by Kannur and Kasargod districts in Kerala. Maharashtra, Orissa, A.P, T.N are other significant raw cashew providing regions in the country. About 50% of total inputs are globally sourced. This is particularly due to the seasonal availability of inputs.

4.3.1. Value Chain Analysis

Procurement cost of 1 bag of raw cashew =Rs 35 X 80 kg =Rs 2800.00 Roasting expenses/ 80 kg =Rs 40.00

Procurement of Raw Cashew80 kg @ Rs 35= Rs 2,800

Roasting Rs 40

Shelling Rs 400

Borma Drying Rs 50

Peeling Rs 400

Grading Rs 130

Packing Rs 50

Cashew Kernels 20 kg @ Rs 200= Rs 400

Value Chain


KBIP, GoK 32

Shelling expenses/ 80 kg =Rs 400.00 Borma Drying =Rs 50.00 Peeling (removal of testa) =Rs 400.00 Grading into W-180, W-210, Splits etc =Rs 130.00 Modified atmosphere packaging in polythene bags =Rs 50.00 Cashew Kernels** =Rs 200 X 20 Kg = Rs 4000.00 (see table of variable costs as per size, alongside) Average yield =20 kg kernels

while processing 80 kg of raw cashew Average selling price is = Rs 200/kg

4.4. PEOPLE PROFILE

Cashew Processing centers. Govt Sector 26 Units. Private sector. 353 Units Private packing centers.107 Units. The employment figures in these segments are presented in the table, along with the location of the processing units, in the Growth Pole Area.

Average monthly incomes of the workers in the sector vary between Rs 1,550 (unorganised sector) and Rs 3,000, with the more skilled workers in both Government and Private sectors making the higher cut. . The government protects the service conditions of the workers in cashew factories. The prevailing rates are

• Shelling @ Rs.13.06/- per kg • Peeling @ Rs.16.61/- per kg • Grading @ Rs.98.10/- for a job

The health benefits of the workers are covered under ESI during the period of work. They also get EPF benefit. Bonuses are paid every year. The employees in the private sector include retired persons from the other factories (mostly Government owned) also, who are classified as non-card workers. Government bonus is paid to card-holders and 20% of their earning is paid as bonus to non card workers. The working hours are from 8 am to 5 pm, with a break of 2 hours in between. DA is paid @ Rs.7.50/- per day for the card workers. The eligibility for DA in

Grade** Rate Yield

W- 180 500/Kg 0.5%W-210 350/Kg 1.0%W-240 255/Kg 7.0%W-320 211/Kg 48.0%W-450 175/Kg 43.5%

Average Income per month

Govt .Women Workers Rs. 2000- 3000

Pvt .Women Workers Rs. 1550- 3000

In Growth Pole AreaSector Employment Location

Govt Sector Processing 14690 Eravipuram

Private Sector Processing 160412 Sasthamkotta

Private sector Packing 1530 KilikolloorCashew 176632 Kottarakkara

NeduvathoorIn Rs, Crores (2004-05) KunnathhoorTurn over 2007 ElampalloorExports 1544


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Kudi varuppu A commission system of cashew processing exists in the area at present, where in cashew is processed into kernels at the houses of the workers on a commission basis (known as “Kudi varuppu”). The average processing cost per a bag of 80 kg in the established units comes to about Rs. 1300/- (in the Govt. sector) and Rs. 1000/- (in the private sector). However, under the commission system, it is only about Rs. 600/-. This allows the player in this segment to undercut the prices of the established players. The industry owners (both private and the Kerala State Cashew Development Corporation) term this practice as unethical and consider this as a major threat for the industry, saying that this will adversely affect the present establishment in the sector. Even as this has been treated as an illegal practice and the government has sought to actively ban it, it continues to run, though small, dissipated units in the Kollam area. Owners of small and medium size units are known to use ‘Kudi varrupu’ based processing to cope with bulk orders on a regular basis. The industry opinion on these units is that they operate outside the purview of organised industry to be able to avoid compliance to rules, book-keeping requirements, paying minimum wages etc. and thus need to be brought to book or become compliant.

shelling section is fixed for minimum quantity of 4.50 – 5.00 kg. In peeling and grading section, attendance is the criteria for DA. The distribution of workers is in the ratio 3:2:1 in shelling, peeling, and grading sections respectively (or 3:3:1 in some cases). It was pointed out during several consultations that the cost of processing cashew in Kollam was much higher than elsewhere in the country and this was primarily due to the higher wage rates protected by the government. Higher skill levels of workers in the area enable greater quantities of cashew to be processed with lower breakage, helping processors offset costs and continue to be competitive in Kollam. In addition, the workers here have, over time become proficient in the manual process with ‘drum roasting’, that is distinctive of Kollam.

WORK OUTPUT

The output of cashew kernels from 80 kg raw material is 20-22 kg.; which includes kernels of different grades. The value of different grades varies. The grades have been discussed earlier in the section. Each of these grades is sorted and the price varies from Rs.300/kg to Rs.60/kg. COST: Price of raw material Rs.34/kg1 Rate for 80 kg : Rs.2720/- Processing Cost (including Wages) Rs.1200/- Rs.3920/- OUTPUT: 22 kg with an average rate of Rs. 200/kg Income: Rs.4400/-

An efficient worker in the shelling section can shell 10-12 kg everyday in the traditional way, and will produce a high percentage of clean, unbroken kernels. In the peeling section one worker can peel about 10-12 kg of kernel per day.

1 This season the cost of raw material has come down drastically, affecting many units negatively.


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FEEDBACK FROM WORKERS

Generally, the workers in the cashew sector are satisfied with the wages and fringe benefits provided by the industry. (See Annex 4A-. Stakeholder consultation table) However, there is scope for modernization of machines/plants, improving the working environment and productivity increase by way of methods improvement. The workers suggest modernization of plants/machinery and proper maintenance of the existing bormas, especially to ensure uniform roasting of the nuts and to make the system more energy efficient so that a uniform quality product is obtained. What they hope for is financial assistance/subsidy for the existing plants in this regard and also training to the workers in the improved machinery/working conditions. The workers engaged in activities like shelling, peeling and grading suffer health problem like back pain, rheumatism, etc., owing to the work posture and work environments. A suitable facility like work tables can be provided to overcome this, especially in the peeling and grading sections which is available in some of the KSCDC factories. The workers in general are not engaged in any other household income generating activity. Some workers do not wish for their children to continue in the cashew sector, especially if they are well educated. However, the family members of many workers are also in this sector. Similarly, cashew sector employs younger generation workers when compared to other traditional sectors like coir or fishing. According to the cashew workers, they are not ready to migrate to any other sectors, since cashew is more remunerative. There is a recent trend of labour migration from the coir sector to cashew sector due to the protected wage structure, fringe benefits and availability of job through out the year. According to the workers, on an average, up to 40% of the women workers in the coir sector are now working in the cashew factories. However, they still hold their Coir primary society membership. According to them, they want to stick to the cashew sector, since it is more remunerative. They will consider returning to the coir sector only if they are faced with health problems or given chance to work in the manufacture of more value added products in coir with increased remunerative prospects.


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4.5. LINKAGES AND NETWORKS

4.5.1. Market linkages

As said earlier, the main buyers of cashew kernels are the United States of America and processors or shippers must go along with the established procedures, which have been evolved over the years since cashew kernels have become an important import item in the U.S.A. 1. U.S.A. The selling of cashew kernels in the U.S.A. is entirely through brokers. Brokers do not “job” as they do in some countries and a sale through a broker will be governed by a contract as between the shipper (processor), and the nut importer and in some cases the user. In the U.S.A. there are nut importers who are wholesalers. They import whole assortments of cashew kernels and resell to the traders the particular grades that each individual nut user may have call for.

• The white whole kernels are used exclusively by the nut salters, that is they are roasted and salted and sold ready for consumption either mixed with other nuts or as roasted and salted cashew nuts along. The salters will pack in small tins convenient to use at one sitting. Roasted and salted cashew kernels soften after a time unless in a tightly sealed container so it is to the advantage both of after a time unless in a tightly sealed container so it is to the advantage both.

• Some salters will use scorched wholes in their roasting and salting programme. Butts are used by the confectionery trade and are either chocolate covered or used in chocolate bars.

• Splits are used by the bakery traders for decoration on cakes or cookies. • Pieces both sizes are also used in both the bakery and confectionery trades

for cookies, cakes and praline pastes. • The scorched grades of pieces are used by the same traders as the white

grades. An importer therefore importing an assortment which includes all the shippable grades, in the outturn will split the assortment on arrival, to deliver to the users, the grades they normally use.

The big users, mainly salters, will import just the grades they require, leaving the shipper to find outlets for the remaining grades. As has been stated before, the cashew business in the U.S.A. is for the most part conducted on futures. A shipper will offer through his broker an assortment. The broker will in turn try and obtain bids from importers and will pass back to his shipper principal the highest bid he can obtain. It is up to the shipper to accept, reject or counter offer. These communications are entirely by cable and offers and bids are normally open for 24 hours only. This means that quick action is required on both sides.


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The assortments offered by a shipper must be balanced and contain approximately the proportions of each grade which would normally be expected in an average outturn. Offers heavy with pieces will receive little interest. Shipments are normally spread over several months and would be shipped in proportion for all grades in equal monthly dispatches. Thus a sale of 6,000 cartons for shipment in three monthly consignments would require the shipper to send 2,000 cartons a month and these 2,000 cartons must contain proportionately the quantities of each grade in the original assortment offered. A shipper has one broker and he will protect the interests of his shipper on all transactions. He will have the buyer open an irrevocable letter of credit on which the shipper may draw 95 percent of the invoice value on presentation of all the shipping documents. The remaining 5 percent will be paid by the buyer to the broker on acceptance of the goods on arrival at destination. The broker will remit to the shipper half of the 5 percent received and retain the other half as his commission i.e. 2 ½ percent of the invoice value. The U.S.A. buyers insure their own goods for shipment. The broker will also protect the interests of his shipper in the event of the buyer making a claim either for faulty goods or late shipment. A good broker will do his best to get the buyer to accept, however if a claim is made he will see that it is fair. Brokers will in addition keep the principal informed of market activity and the shipper may from time to time feed the broker with important news regarding the crop and competitors’ activities if known. Brokers will represent a number of shippers and may have principals in all the producing countries. Thus they are well informed on the world position, which is important to a shipper as he is operating in a world market and not just a market confined to his country’s crop. Attempts to sell cashew kernels direct to buyers and thus circumvent a broker, saving 2 ½ percent commission, have also met with problems. The shipper denies himself the important information on market tendencies and transactions and is virtually working in the dark. The buyer is aware of this and has the edge over the shipper who is less aware when working without a broker. The broker pays all his cable charges and the shipper pays for his own cables. Good relationship must exist between broker and principal; mutual confidence is essential. 2. United Kingdom and elsewhere In the United Kingdom, and to some extent on the continent and in Australia, New Zealand and the Far East, sales are conducted through brokers who are also jobbers, in other words they themselves will buy the quantity offered and resell as and when they wish. They may have an outlet for a certain quantity and will take


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Trends and Recent developments: International Markets and Supply Chains Mr George Paulose is the President/CEO of AMES International, Inc., a Seattle/Tacoma, WA based company established in 1987, a manufacturer and distributor of various nut products, gourmet chocolates, and gourmet cookies. The company is well established in the domestic market, and their clientele include large club stores. They import about Rs 100 Crore worth cashew from India every year (this is done through brokers). AMES is in the process of establishing a cashew –chocolate factory in Cochin and are looking for some supply chain arrangements for raw nuts for this factory as also for operations in the US, to do away with the broker-based procurement. “Indian cashew used to enjoy a premium in the US market because of it’s quality and earlier the label used to be ‘Cashew(Indian)’”.According to Mr Paulose this distinction was made possible due to the drum roasting and the manual-shelling process, which ensured a superior taste. Of late this distinction is not made as the label brackets ‘India and Vietnam’—where Vietnam uses the more generic ‘steam boiling/cooking process. There has been no conscious effort on Kollam/Kerala’s part to capitalize on the advantages of drum roasting and also the unique skilled process of hand shelling. Drum roasting is a superior method of processing as while the roasting takes place the oil contained in the outer shell is burnt off/removed .Oil in the shell is not a desirable component. During this process the oil from the kernel also comes out and gets burnt. In the process it creates pores in the nuts (kernel) increasing the porosity. This helps in effective roasting of fresh kernels as the porosity helps penetration of oil and salt through and through. On the contrary steam boiling involves injecting moisture in to the nuts to expel oil, which in turn moistens the kernel surface under the shell and the gives a smooth appearance; it’s amenability to processing is far inferior to drum roasted nuts. The world-over, future processing is going to be through steam boiling. Thus, there is strong logic to protect the drum roasting system that is unique to Kollam, and has a distinct taste, that the market has a stated preference for. Even as buyers/importers are unhappy about the processing methods they have limited capacity to act. Given his position, Mr Paulose is keen to explore a partnership in the proposed SPV of SSI units to have sustainable business relations given AMES’ proposed local venture and continued sourcing requirement. He is in the process of setting up a cashew based unit (value addition and packaging) in Cochin, geared towards export.

the view that they could sell more by the time the ship arrives. Normally, payment is made against an irrevocable letter of credit and 95 percent of the invoice value may be drawn against shipping documents. Again 2 ½ percent is the commission and the balance remitted on acceptance of the goods. Prices are normally c.i.f. and insurance must be taken into account. Local sales are made in accordance with local practice and require no special comment. The off grades have to be sold too. The outlets for these are through the livestock feed industry or the poultry industry but they must be got rid of regularly otherwise they will harbour infestation to the detriment of the shippable grades.

4.5.2. Credit Linkages

Cashew processing sector in the district is dominated by large and medium sized cashew processors which are mostly export oriented. Around 35 to 40 such units account for as much as Rs. 2000 crores out of total turnover of around Rs. 2500


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crores in the district. Thus, more than 90 % of estimated 400 cashew processing units in the district account for only 20 % of total turnover. Typically, cashew processing requires rather small investment in plant and machinery and considering that processing margin is merely 10 % or so, most critical factor is the volume of operation and access to large working capital for procurement of raw cashew nuts. Not surprisingly, this enables large players to enjoy economies of scale even as most of the smaller players fight for better price realisations. There is estimated to be around Rs. 1400 crore of loan outstanding to the sector in the district almost all of which are towards working capital. As most of the working capital is required for import of raw nuts, advances are in the form of packing credit. Many of the commercial banks branches are depending heavily on large and medium enterprises for business and there appeared to be stiff competition among bankers for accounts of large clients. CREDIT PLAN FOR CASHEW SECTOR

Any credit plan for the sector has to take into consideration the fact that larger and medium processors have no dearth of credit at their disposal. As most of the advances are towards exports and often LIBOR linked, the rate of interest too remains around 7-8 % p.a. even as interest rates for domestic enterprises range around 13-14 % p.a. Thus, credit intervention is required for small processors and not large and medium processors. A series of interactions with Lead Bank Manager and other prominent bankers of the district clearly indicated their hesitation in extending credit to the small processors. The bankers seemed happy with limited number of large accounts and contended that the considering low value addition possibilities in the sector (given its present context), small processing operations would not be financially viable. The bankers were, in particular, concerned about wide fluctuations in price of imported raw nuts and said that smaller processors are less equipped to deal with such fluctuations. There is though need for credit intervention for small processors to ensure sustenance of their operations. Any such intervention has to be aimed towards ensuring their access to raw materials at reasonable prices. Against this background, the idea of a common procurement and packaging facility has been discussed with several parties and in concept, seemed an appropriate intervention for small processors, with a group of small processors who are prepared to come together for such a project. On further discussion and exploration of the mechanics and implications of bulk procurement, it has been found that running


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a facility of this nature comes with several attendant issues of market fluctuation, that may actually be its biggest drawback, even as this is the problem that the measure was conceived to address. The need for modernisation of small processors also needs to be addressed. Most of the small processing units are working in dilapidated buildings with old plant and equipment. A scheme to help modernise these processing units would definitely help in increased productivity. This would also be able to address hygiene concerns of the increasingly stringent food market.

4.5.3. Agencies and Institutions in the cashew processing sector

• Cashew Export Promotion Council of India. • Cashew Manufacturers and Exporters Association • CAPEX. • The Kerala State Cashew Development Corporation. • Cashew Project Office. • District Industries Centre. • Kerala Bureau of Industrial Promotion. • Financial Institutions.

SUPPORTING SERVICE PROVIDERS.

• Clearing and forwarding agents. • Shipping Agents. • Custom house agents. • Internationally accredited Cashew Export Promotion Council Lab. • Synergy Systems – Quality surveys and certification of food s exported. • Trainers of laboratory personnel. • Consultancy services for setting up food quality evaluation laboratories. • Facilitators of ISO 9000 QMS and Food Safety Management Systems. • Suppliers of Flexible packing bags. • Machinery and packing material suppliers.

4.6. GAP AND ISSUES ANALYSIS

The following issues have been flagged along with suggestions, where they were made, to bring out the needs and requirements in the industry. These are based on interactions with primary stakeholders in the sector and have been validated subsequently through observations and group discussions.


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Input supply and procurement: The sector is characterized by seasonal availability of domestic inputs. The procurement pattern amongst the medium and large players is as follows: April – June From India (Maharashtra, Orissa, A.P, T.N, Kerala) Nov- Jan ( Tanzania, Indonesia). Global sourcing is pursued directly through importers. While medium and large players can pursue this initiative, the smaller players do not have the resources or wherewithal to pursue such initiatives. Constraints are also evident in terms of shifting cultivation patterns in some locations such as Kerala. Products such as rubber yield higher return to the cultivators and hence many cashew cultivation plantations have shifted to other crops. With regard to quality of inputs raw material from East Africa is preferred. This is because the product from there is more standardized (size, moisture, oil content, breed). The procurement from India is in different assorted sizes landings are from different regions - Maharashtra, Orissa, A.P, T.N, etc. To facilitate optimal stocking of inputs and optimise freight costs, warehouses are also located at ports- Kochi or more distant Tuticorin. Quality: Development of innovative processing technologies is needed for process improvement and to reduce cost of production. Studies on nutritional aspects of cashew kernels are essential with an idea to bring out the beneficial aspects of nut nutrition and to enhance its market acceptability. Comprehensive survey on the quality of cashew kernels with special reference to micro contaminants such as Pesticide residues, micotoxins, heavy metals, micro organisms etc so as to alleviate the apprehensions on the health quality of cashew kernels. Presently USA and EU countries are very particular about residue analysis in Parts per Trillion (the more common PPM analysis is not enough). Therefore, a well-equipped lab with sophisticated testing apparatus is required for the sector. This facility may not essentially be located in the growth pole area as such facilities need to go through appropriate standards and approvals, certifications etc. Linkages with existing pre-approved facilities may be a more optimal solution. Training and Skill upgradation: Training of labour is currently in house (on- the- job). Specialized training inputs is particularly relevant as the cluster enterprises move towards manufacturing value added products and lower the exposure to risk for workers.


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Model-units equipped with modern pilot plants are essential for the development of the sector. The status of the cashew processors should be upgraded to food processors so that young generations are attracted to this field by systematic training. Also, technologies and practises that create better working conditions for people in the factories processing units. Incorporate improved training to instil better, safer and cleaner practises, especially for women workers to ensure steady flow of workers into the sector. These model-units could also become the centre for upgrading present conditions of all processing centres in the state. Policy: Countries such as Vietnam have attracted FDI which has led to establishment of socio – environmental and quality compliant production infrastructure, declining exchange rates vi-a-vis the USD has also led to their being artificially competitive in export markets, (though, in recent months, this scenario may have changed, with the change in value of the USD.)

• A corpus fund could be evolved to finance micro/ cottage enterprises in a Mutual Credit Guarantee Fund Scheme (MCGFS) mode. SIDBI may serve as a vehicle to evolve and contribute such a fund that may be employed to leverage the collateral free credit amongst informal sector micro / tiny enterprises for technology upgradation, in the medium to longer term.

Production, Technology and Product Development:

• Product is sold, as a commodity .It is necessary to explore the possibilities of value added manufacturing options.

• The working conditions of cashew processing centres are to improved for getting maximum productivity from workers, with special attention on women workers’ issues .

• Steam boiling process is an option to enhance productivity. However, R&D initiatives are required to explore the means of retaining the original taste/ flavour of cashew.

• Moving up the value chain would involve graduating to manufacture products in retail packs under global brand names. This would involve the establishment of a necessary facility for pursuit of pilot testing different products and appropriate packaging. Links with Global marketers may be made as part of market development interventions.

• Meeting Global standards in terms of USFDA norms, GMP, isa vital also for smaller and medium sized enterprises.

• Segregation of commercially important components from CSNL, Cashew Testa and Cashew Gum.

• Upgradation in job quality as also meeting the above norms and progressively important norms regarding social compliance will involve


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development of shop floor with appropriate ergonomics seating arrangements, electric ovens, gloves etc.

• Development of hygiene and sanitation standards (HACCP/ISO) to work out control parameters in processing with the objective of implementing systems that would ensure safe and quality cashew kernels for human consumption, in these days of frequent inspection by foreign buyers in processing factories and heightened consumer awareness.

• Further, interested parties may explore collection and preservation of cashew apples and development of value added product from the same, in parallel. This may be a more viable proposition in the plantation area, which is shifting out of the growth pole area.

Pollution Control: Presently the smoke from the drum roaster is directly discharged to the atmosphere with out any treatment. It is a thick smoke contains a lot of carbon particles and traces of CSNL. Besides this industry creates some sorts of water pollution while discharging the liquid waste of steam boiling with out treatment. Marketing and market development

• The brand of Kollam Cashew in terms of drum roasting and de shelling is yet to be protected and promoted.

• The drum roasting and manual de-shelling help the end product to retain flavour due to oil retention. Market such as Japan offers a premium for such products. However brand promotion and cost competitiveness and market penetration initiatives need be enhanced if Kollam cashew is to serve higher market share vis-a- vis global competitors. De-shelling involves the removal of shells in a manner as to retain quality kernel inside. In many locations outside Kerala the skilled labour force from Kerala is used for such manual operations.

• However, in some locations the alternative process of steam boiling is being pursued and preferred.

• The enterprises in the cluster are largely in the lower end of global value chain. They need graduate into retail packing stage and marketing under global brand name and marketers such as Marks & Spencers, Sainsburry, K- Mart etc.

Finance: The medium sized enterprises are affected by inadequate financial resources to stock inputs for an extended period of time. Even medium sized enterprises confront supplies with wide price fluctuations.


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For instance the globally sourced inputs the price are as follows: RS. 38/Kg (April –June) Rs. 33 (July – Sep), and Rs. 35 (Nov – Jan). The ability to stock inputs over extended period of time by medium sized and smaller units influence the profitability of the enterprises. Evolution of consortia amongst the medium and larger, small enterprises to stock inputs is vital in this context. Cottage enterprises are starved of cash to meet basic requirements: cash purchase of inputs, meet living expenditure over period of credit sale etc. Strengthening industry associations: The major industry association in this region includes Cashew Manufacturers and Exporters Association, Cashew export promotion Council etc. The industry association have facilitated declaration of Kollam as ‘Town of Excellence’ eligible for various support schemes offered by department of. Commerce, GOI. The capacity building of industrial associations to:

• Implement large infrastructure upgradation / incubator projects under PPP basis.

• Establish a business information centre as to offer information and services to large as well as SMEs is critical. The information service may be in terms of market information – network with conveners networkers with potential FDI/ JV partners, information fair in India / abroad and specifically on in-coming – out going related business delegates in India, shifting consumer trends etc.

Establishing efficient industry / institutional linkages:

• Stake holders meet with FIs are particularly critical to evolve appropriate instruments as to adequately finance SMEs and Micro / cottage units.

• Establishment of an incubation centre for value added production may be on PPP basis involving local academic / institutions such as TKM College of Engineering, Polytechnics etc. in the longer term

• R &D fund proposed to be established at CEPC Laboratory and Technical Division may be managed by an SPV involving industry association representatives as well as members of Cashew Export Councils.

4.6.1. SWOT Analysis

Strengths. • Skilled workforce available

Weaknesses. • Inadequate WC facilities to stock

inputs procured optimally during


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• Established global supply sources of input- raw cashew.

• Strong linkages and presence in the export market.

• Large and medium enterprises employ advanced quality and packing systems, and are quality compliant as to meet international marketing requirements.

season, inadequate warehousing facilities to stock inputs over time.

• Poor job quality and working conditions in the shop-floor particularly in smaller enterprises of the processing centers.

• Little value addition to inputs • Inadequate protection and

promotion of the cluster brand • Inadequate linkages with Fis (in

terms of customized financial instruments) for medium and small players as well as tiny sector/inadequate incubation facilities to explore value added production.

• Entrepreneurs are not very enterprising.

• No collective effort for skill up-gradation of workers.

• Weak R&D at processing level

Opportunities. • Need for large and medium

players, particularly, to move up the value chain is evident. The products are also primarily processed and sold in bulk packaging than consumer packs. Manufacture of value added products could increase trends towards.

• Appropriate grading and packing facilities, pilot plants established as CFCs could specifically help smaller enterprises graduate.

• Scope to link up directly with global marketers and realize higher value.

• High nutrition value of the product – scope for generic promotion as a health food.

• Scope to protect/promote uniqueness and labour intensive nature by means of registration under a special mark [Trademark]- unique of the distinct process

Threats. • Food safety issues especially in

view of large export markets and the increasing pressure of compliance both in export and domestic segments

• High wages for organized units driving “peak load” and some new investments to other states like Tamil Nadu and AP

• Shifting domestic cultivation towards other crops affecting domestic supply-need for value addition at processing stage so that higher margins may be offered to producers

• Competition from other parts of the country (with cheaper labour) and the world (better factor conditions etc.)

• Poor working conditions and tedium of job not attracting new generation of workers


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4.7. PROJECT APPROACH AND SECTOR THEME

The theme in this well-established sector is to introduce new work methods and process efficiencies through demonstrated technology and work practice changes. Specific focus is also directed at the aspects of worker-safety, health and environment (SHE) and, hygiene standards in the processing chain. Even as this sector has been profitable and continues to grow, the issues mentioned have not received sufficient attention in recent years. It is believed that once these issues have been satisfactorily demonstrated to the industry along with sector-wide discussion and dissemination, the other factory owners will be in a position to adopt the improved practices on their own.

4.8. OVERALL INTERVENTIONS

Overall interventions that are under consideration for the larger Growth Pole Programme are listed, some of these have been previously discussed as part of the one-year project report, submitted earlier. The cashew sector, in addition to being a well-established and high-performance sector is also significantly export oriented. Given its performance, and the fact that all major players represent the organised sector with consistently good performance in terms of turnover, it is assumed that the industry will have the capacities to make strategic investments in its improvements, once better and more improved processes are demonstrated to them. The idea is to design a demonstration project for introduction and uptake of efficient and cleaner production practices in the sector and through this, aim at a mainstreaming of these cleaner (and food safety standard compliant) practices. In addition, linking demonstrated financial returns of the improved practices to the sector would make for a wider uptake Research and development, that has till date received little attention from the point of view of industry uptake and improvement also needs to be funded, assessed and linked with an appropriate dissemination system to ensure its optimal performance.

4.8.1. Project Components:

In this regard, process efficiencies will be demonstrated for primarily the Drum Roasting type of units, as the focus will be on those with the traditional drum-roasting based process (most units). Those with the newer, steam-


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boiling/cooking process will also have the option of opting to be part of the first phase of the project, depending on their meeting with the selection criteria laid out. These measures at the units are proposed with envisaged contribution from the beneficiaries in the form of input raw-material, to begin with. It is also proposed to target the “un-organised sector” operating in the Growth Pole area with the ultimate aim of assisting them to become organised and ‘legal’/compliant. It is believed that the initial support extended to them in the first year, along with subsequent exposure to norms, regulations, enterprise development inputs and linkage and access to credit, in the following years will provide the necessary impetus to mainstream the operations. This support may be conditionally offered to enterprises that express a willingness to make the envisioned transition. These efforts may be coupled with a tougher clamp-down on non-compliant/illegal units in the subsequent years. The sector-consultations conducted with representatives in Trivandrum on this and other aspects of the Kollam Growth Pole Programme brought out the state government’s reservation about offering the ‘illegal-processors’ or kudivarupu, a second chance as outlined above. Further discussions on this are be required with the participation of the State Government representatives and the NCEUS, to clarify the path ahead, on this issue.

MODEL UNITS

• Improved process efficiencies in different unit types –Drum roasting (traditional)- 6 units in the SSI sector and 2 in the unorganised sector –(Steam boiling (newer method)- 2 units from the organised sector may be selected, in place of 2 drum roasting units, if it is so decided by the group making the selection. --Shelling and peeling (processing – in the roasting system)- this would be covered in the 4 organised units (drum roasting) and in addition, 2 units from the unorganised sector will also be taken up, that concentrate on this activity. --Grading, re-grading and packing-- this would be covered in the 4 units in the organised sector (drum roasting), (or optionally, in 2 from drum roasting, if 2 units in the organised sector (steam boiling) are to be included. In addition, 2 units from the unorganised sector will also be taken up, that concentrate on this activity. Selection process: it is proposed that the selection of the units to be upgraded to ‘Model Units’ be made by a consensus between the Local Industry Associations of cashew processors/exporters, CAPEX, representatives of the worker associations and the GM, District Industries


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Centre, Kollam. This would require several meetings, to clarify the criteria for selection and the contribution requirements, in addition to the requirements of the institutions for monitoring and demonstrating the improved processes, on the part of the owners of the selected units to be upgraded. An agreement would also require to be drawn up, to facilitate this process and for the group to monitor and run the process, with the Growth Pole Agency, in the units, over the five year period. Process efficiencies:: In the absence of scientific and established norms/good practises at the industry level regarding improved process efficiencies in cashew processing units, several areas of research and development have been flagged that require the attention of various technical expert groups, for evolving acceptable systems that are efficient, worker friendly and optimal in terms of running costs etc. These areas are referenced below. Taking on from the findings arrived at through these exercises, the solutions arrived at will be incorporated into the selected Model Units to upgrade their functioning. These processes efficiencies would include, but not be limited to:

- Sorting of raw nuts (mechanical, gravity based/size based sorting) - Mechanisation of the drum roasting process to reduce drudgery,

offer optimal control in terms of a variety of settings (flexibility required, depending on the quality of input), reduce exposure to high temperatures and (thereby) risk, incorporate energy efficiency of fuel used by shortening time required for process, optimising heat etc. This process will incorporate the procurement/fabrication, installation and commissioning of the improved systems. [Training required to ensure uptake of the new systems is included as a component in a subsequent sub-section]

- Improvement of sheds that house this part of the process, with adequate ventilation and worker safety provisions.

- Ensuring that the stack heights for drum roasting units are compliant with pollution control board norms, effluent to be channelled into appropriate treatment system before discharge into municipal drains/other outlets.

- Energy/fuel efficiency, temperature monitoring and control of ‘borma’ unit, automation and safety provisions to optimise inputs and increase efficiency.

- Process efficiencies of existing equipment (based on study findings). Interventions to improve cooling chamber w/water spray, conditioning room for kernels

- Improvement of sheds, worker environment (in terms of ergonomic seating, general anthropometric design, tools,


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provision and sustained use of personal protective equipment) in the shelling (and sorting) units. In steam boiling units, should they be included, table mounted cutters may be included, based on their assessment by the shelling staff.

• Research and development (processes and management systems): This includes an overall systems approach to resource and process optimization including interventions in the management practices followed, to ensure all-round efficiencies, since, at present, this kind of assessment has not been undertaken and the processes used in the Growth Pole have not been updated in the last several decades. As part of this aspect, research in several areas is required to be undertaken to establish good practises in terms of worker environment, improved efficiencies, and clean practises. The primary focus is proposed to be on improved safety, health and environment (SHE) with a particular focus on women workers and worker health and safety. This would further draw from a number of other proposed interventions, like the module on work methods improvement to address specific issues of posture-change and tooling; adoption of mechanization; adhering to food safety standards etc. The R&D is proposed for the following specific issues, and overall process improvement as well:

- Drum roasting automation - Energy /fuel use in roasting and “Borma” - Worker health and safety, ergonomics, use of personal protective

equipment - Management of air and water emissions, disposal of burnt/waste

cashew shells - Cutting machine (if steam boiling is selected) - Boiler house (if steam boiling is selected) - Management systems (overall) - Existing equipment including cooling chamber w/water spray,

conditioning room for kernels

• Improved hygiene for Food Safety Standards compliance:

Demonstration, system upgradation and training (including training of trainers)


KBIP, GoK 49

• Work methods improvement (R&D and capacity building) This aspects is addressed with a combination is interventions in terms of process efficiencies improvement, research and development on better practises and its implementation, and, training of the workforce (ongoing) for uptake of the improved processes.

• Sector-wide, multi-level dissemination of improved practises Dissemination in terms of technology upgradation, worker-environment and safety improvement, efficiency improvement, management systems upgradation, etc, to encourage wider uptake. Its is proposed that this be undertaken through periodic interaction of the various key stakeholders in the Cashew Sector ; this includes, MSME representatives like processors, exporters, worker association representatives, government representatives from associated departments like industries, environment , pollution control board, labour, etc. Monitoring and reporting parameters have been included in the project components to ensure that findings/learnings (including potential pitfalls and problems) can be discussed and disseminated for the rest of the industry, with the participating Model Units, through the course of upgradation.

EDP AND CAPACITY BUILDING INITIATIVE:

This would cover 500 units with 4 persons nominated by/ selected per unit for 4 types of training:

1. Training 1: Process efficiencies 2. Training 2: Worker health and safety (supervisor training) 3. Training 3: Worker health and safety (women workers) 4. Training 4: Cleaner practices and standards

The base costs of this would be @ Rs 10,000 per training and each training is expected to be 2 days long 1. Efficiencies training – three refresher courses. One every three months 500 persons undertaking a 2-day training four times a year for 2 years 2. Health and safety- Refresher course every 6 months 1,500 persons undertaking a 2 day training twice a yr for 2 years In this component, the last two courses become training-of-trainer courses to facilitate dissemination and sustainability at unit level The courses at the management institute will operate as paid courses thereafter


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Initial cost will be to set-up the course and the training unit with trainers Training to happen at the government co-operative units (26 units) for demo and training. Batch size of 20 50 events for Training 1 150 events for Trainings 2, 3 ,4 included These components are summarized, by cost in the following table

4.8.2. Financial aspects

Intervention with description Rs lacs One time Per Unit No of units Total

CASHEW A Drum roasting

1Automation Study 1.50 1.50 1.50 Designing, prototype 20.00 20.00 - - 20.00 Fabrication 5.00 5.00 4 20.00 Installation and Commissioning 2.00 2.00 4 8.00 Monitoring and Evaluation 1.00 1.00 4 4.00 sub-total 29.50 53.50

2Protective Equipment, Health andSafety

Work study 1.50 1.50 1.50 Shelling and Peeling 10.00 10.00 4 40.00 sub-total 11.50 41.50 Category Total 41.00 95.00

B Steam boiling Equipment 10.00 10.00 4 40.00 Cutting machine foot operated shelling 5.00 5.00 4 20.00 Installation and Commissioning 2.00 2.00 4 8.00 Boiler House 1.50 1.50 4 6.00 Monitoring and Evaluation 1.50 1.50 4 6.00 sub-total 20.00 80.00

Common Processes / actions for Drum and Steam Units C PPE Health and Safety Civil Works and Fixtures (50:50) costs Grading and Packaging 10.00 10.00 6 60.00 D Mgt Systems Rs 1 l per month per unit for 2 engineers Rs 50k per month for 6 months per unit Study and report 6.00 6 6.00 Implementation of findings/training 3.00 3.00 6 18.00 Monitoring 3.00 3.00 6 18.00 sub-total 22.00 102.00


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E Process documentation 1 time for entire intervention 6.00 6 6.00

F Process efficiencies of existing equipment

Study (1 time for intervention) 3.00 3.00 - 6 3.00 Cooling chamber w/water spray Kernels - Conditioning room 3.00 3.00 4 12.00 Re-engineering 15.00 15.00 4 60.00 sub-total 21.00 75.00

G EDP Training and Skill Development

for Unorganized cashew EDP Training 5.00 5.00 Sensitization 10.00 10.00 sub-total 15.00 15.00 H Producers' SPV (from year 3) 1,100.00 600 10 50 1,100.00

Resource Cell at Selected Expert Institute 400.00 400.00

Technology Upgradation Fund (Drum Roasting) 250.00 25 10 250.00

Drum Roasted in Kollam Trademark 75.00 25 75.00 sub-total 1,825.00 1,825.00 CASHEW SECTOR Total 2,258.00

4.9. INSTITUTIONAL PARTNERSHIPS

The following agencies/organizations etc are proposed to be involved with the project.

• Cashew Manufacturers and Exporters Association • Cashew Export Promotion Council of India • District Industries Centre

o For identification of project partners for technology upgradation partners

• Engineering college / R &D institution o Drum Roasting equipment design and prototype

• Management Institution / Engineering Institution o Process re-engineering o Best Practices

• HACCP Implementation Agency / KBIP o Food standards

• EDP Training o EDI or similar expert institution


KBIP, GoK 52

4.9.1. Funding Sources and Schemes

Ministry of Food Processing grant of 25% up to a maximum of Rs 50 lacs for setting up or modernization of individual cashew processing unit.

FUNDING SOURCES

Intervention-wise details of proposed funding sources, is presented in the following table: (See Table)


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% e lig ib le u n d e r v a r io u s h e a d s A m o u n t in R s la c sIn t e r v e n t io n w i t h T o ta l G O I G O K U s e r s P v t s e c t N C E U S G O I G O K U s e r s P v t s e c t o r /b aN C E U S

C A S H E WA D r u m r o a s t in g

1 A u t o m a t io nS tu d y 1 .5 0 2 5 % 3 5 % 0 % 0 .3 8 - 0 .5 3 - 0 .6 0 D e s ig n in g , p r o to ty p e 2 0 .0 0 2 5 % 3 5 % 0 % 5 .0 0 - 7 .0 0 - 8 .0 0 F a b r ic a t io n 2 0 .0 0 2 5 % 3 5 % 0 % 5 .0 0 - 7 .0 0 - 8 .0 0 In s ta l la t io n a n d 8 .0 0 2 5 % 3 5 % 0 % 2 .0 0 - 2 .8 0 - 3 .2 0 M o n ito r in g a n d E v a lu a t io n 4 .0 0 2 5 % 3 5 % 0 % 1 .0 0 - 1 .4 0 - 1 .6 0

s u b - t o t a l 5 3 .5 0 1 3 .3 8 - 1 8 .7 3 - 2 1 .4 0

2 P P E , H e a l t h a n d S a f e t yW o r k s tu d y 1 .5 0 2 5 % 3 5 % 0 % 0 .3 8 - 0 .5 3 - 0 .6 0 S h e ll in g a n d P e e l in g 4 0 .0 0 2 5 % 3 5 % 0 % 1 0 .0 0 - 1 4 .0 0 - 1 6 .0 0

s u b - t o t a l 4 1 .5 0 1 0 .3 8 - 1 4 .5 3 - 1 6 .6 0

C a t e g o r y T o t a l 9 5 .0 0 2 3 .7 5 - 3 3 .2 5 - 3 8 .0 0

B S t e a m b o i l in gE q u ip m e n t 4 0 .0 0 2 5 % 3 5 % 0 % 1 0 .0 0 - 1 4 .0 0 - 1 6 .0 0 C u t t in g m a c h in e f o o t 2 0 .0 0 2 5 % 3 5 % 0 % 5 .0 0 - 7 .0 0 - 8 .0 0 In s ta l la t io n a n d 8 .0 0 2 5 % 3 5 % 0 % 2 .0 0 - 2 .8 0 - 3 .2 0 B o i le r H o u s e 6 .0 0 2 5 % 3 5 % 0 % 1 .5 0 - 2 .1 0 - 2 .4 0 M o n ito r in g a n d E v a lu a t io n 6 .0 0 2 5 % 3 5 % 0 % 1 .5 0 - 2 .1 0 - 2 .4 0

s u b - t o t a l 8 0 .0 0 2 0 .0 0 - 2 8 .0 0 - 3 2 .0 0

C o m m o n P r o c e s s e s / a c t io n s f o r D r u m a n d S t e a m U n i t sC P P E H e a l t h a n d S a f e t y

C iv i l W o r k s a n d F ix tu r e s G r a d in g a n d P a c k a g in g 6 0 .0 0 2 5 % 3 5 % 0 % 1 5 .0 0 - 2 1 .0 0 - 2 4 .0 0

- - - - - - - - - -

D M g t S y s t e m sR s 1 l p e r m o n th p e r u n i t fo r R s 5 0 k p e r m o n th fo r 6 S tu d y a n d r e p o r t 6 .0 0 2 5 % 3 5 % 0 % 1 .5 0 - 2 .1 0 - 2 .4 0 Im p le m e n ta t io n o f 1 8 .0 0 2 5 % 3 5 % 0 % 4 .5 0 - 6 .3 0 - 7 .2 0 M o n ito r in g 1 8 .0 0 2 5 % 3 5 % 0 % 4 .5 0 - 6 .3 0 - 7 .2 0

s u b - t o t a l 1 0 2 .0 0 2 5 .5 0 - 3 5 .7 0 - 4 0 .8 0

E P r o c e s s d o c u m e n t a t io n1 t im e f o r e n t ir e in te r v e n t io n 6 .0 0 2 5 % 3 5 % 0 % 1 .5 0 - 2 .1 0 - 2 .4 0

F P r o c e s s e f f ic ie n c ie s o f S tu d y ( 1 t im e f o r in te r v e n t io n ) 3 .0 0 2 5 % 3 5 % 0 % 0 .7 5 - 1 .0 5 - 1 .2 0 C o o lin g c h a m b e r w /w a te r - 2 5 % 3 5 % 0 % - - - - - K e r n e ls - 2 5 % 3 5 % 0 % - - - - - C o n d it io n in g r o o m 1 2 .0 0 2 5 % 3 5 % 0 % 3 .0 0 - 4 .2 0 - 4 .8 0 R e - e n g in e e r in g 6 0 .0 0 2 5 % 3 5 % 0 % 1 5 .0 0 - 2 1 .0 0 - 2 4 .0 0

s u b - t o t a l 7 5 .0 0 1 8 .7 5 - 2 6 .2 5 - 3 0 .0 0

G E D P T r a in in g a n d S k i l l f o r U n o r g a n iz e d c a s h e wE D P T r a in in g 5 .0 0 2 0 % - - 1 .0 0 - 4 .0 0 S e n s it iz a t io n 1 0 .0 0 2 0 % - - 2 .0 0 - 8 .0 0

s u b - t o t a l 1 5 .0 0 - - 3 .0 0 - 1 2 .0 0

H P r o d u c e r s ' S P V ( f r o m y e a r 3 ) 1 ,1 0 0 .0 0 4 0 % 5 0 % 1 0 % - - 4 4 0 .0 0 5 5 0 .0 0 1 1 0 .0 0 R e s o u r c e C e ll a t S e le c te d 4 0 0 .0 0 1 0 % 9 0 % - - 4 0 .0 0 - 3 6 0 .0 0 T e c h n o lo g y U p g r a d a t io n 2 5 0 .0 0 5 0 % 5 0 % - - 1 2 5 .0 0 - 1 2 5 .0 0 D r u m R o a s te d in K o lla m 7 5 .0 0 1 0 0 % - - - - 7 5 .0 0

s u b - t o t a l 1 ,8 2 5 .0 0 - - 6 0 5 .0 0 5 5 0 .0 0 6 7 0 .0 0

C A S H E W T o t a l 2 ,2 5 8 .0 0 5 % 0 % 3 3 % 2 4 % 3 8 % 1 0 4 .5 0 - 7 5 4 .3 0 5 5 0 .0 0 8 4 9 .2 0


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4. B. FISHERIES SECTOR

The fisheries sector in Kollam is an important one with Marine Fisheries being a significant economic activity given the length of coast line available to the district. Inland fisheries, practiced largely in the Ashtamudi Lake (saline water) and canal is a less intense practise in the Shastamkota Lake as that is the source of fresh water supply to Kollam Town (drinking water source). The relative volumes from marine fisheries viz inland fisheries is a trend observed at the state level as well with the inland fisheries sector showing a slow

and steady increase over the years but still remaining a small fraction of the overall fisheries sector. Even so, inland fishery sources in the Kollam area are well exploited, and in terms of techniques used, in expert opinion, over-exploited.

Both, Marine and Inland fisheries sectors are covered in this section, though Marine fisheries is the more significant sector. An assessment of the Inland fisheries sector follows the one on Marine fisheries. The map shows the marine fisheries belt and the location of inland water bodies, viz the Growth Pole Area.

With the Growth Pole Area covering most of the coastal belt of Kollam district, marine fisheries is the default sector of importance here, with about 70% of the

Coastal belt: Marine Fisheries

Shastamkota Lake Ashtamudi Lake


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population in the area dependent upon the fishing industry for its livelihood. The cluster profile gives the employment by activity, in the fisheries sector and the location of these activities by area (GP and village). Shrimp and prawn form an important part of the catch here and there are several women involved in pre-processing activities (peeling and de-veining of the shell fish).

4.1. CLUSTER PROFILE : MARINE FISHERIES

The marine fishery cluster at Kollam has a total turnover of about Rs. 1,439 crores and exports accounts for about Rs 920 crores. The cluster enterprises at the lower end of the value chain (trawler operators, auctioneers and pre-pre-processors) cater to the requirements of the exporters within the growth pole region as also exports in other locations. There are around 700 of tiny and small trawlers, 1,732 of other conventional crafts are operating. There are around 14,768 of active fishermen working in this Growth Pole area in the marine fishery sector. Various external policy parameters such as the EU ban requiring enterprises to be HACCP compliant, the aquaculture ban, the banning of aquaculture farming within a certain range of the cost, also, depreciating currencies of competing countries, has led to players such as Thailand, enhancing their market shares vis-à-vis regional players.


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Fishing

Fish Landing

Sorting

Packing and icing in crates

Auction

Dispatch

Domestic market Fish Preprocessing Centers (Peeling and

cleaning)

Fish Drying Units

Fish processing Units (Inspection, Sorting,

Packaging)

Deep Freezing

Dispatch for Export

The Kollam Growth Pole Area, key to the fisheries sector, has several landing centres of which, Needakara and Sakthikulangara are most significant for marine fisheries. Apart from these, there are several minor landing centres along this belt; Thangassery, Vadi, Moothakkara, Jonakapuram, Port Kollam etc Average Yield Per Day (in MT) Average landings/day at Needakkara -188 Average landings/day at Sakthikulangara -98 Beach landing centre- On Board Motor (OBM) valloms Average landings/ day at Thangassery, - 10 Average landings/ day at Vadi, - 10 Average landings/ day at Moothakkara, - 10 Average landings/ day at Jonakapuram, - 10 Average landings/ day at Port Kollam - 10 Other small landing centers in this area - 18 Total - 354


Fish, one of the most perishable food items, is highly susceptible to bacterial and enzymatic spoilage unless handled, processed, packed and stored scientifically. Processed fishery products are the largest single foreign exchange earning export item for India, earning annually more than Rs. 6500 crores in foreign exchange. The industry gives nutritious food to millions and gives direct and indirect employment to millions of rural poor, especially women. For the same reason, processing of fish and shellfish captured from or cultured in fresh, brackish and marine waters has become one of our major industries. The process diagram for processing shell-fish and other fish, is given alongside. Initially, Japan and the US were our major markets, but now, new markets like European Union (EU) countries and China are opening up. But the importing countries are becoming


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more and more quality conscious and are imposing stringent quality standards for the products imported by them. Quality concepts have undergone tremendous changes over the years. Earlier, the quality "control" was done at the end product stage. But this has now given way to new concepts like ISO 9000, Hazard Analysis Critical Control Point (HACCP) etc. These have revolutionized the food processing industry. "Quality Control" has changed into "Quality Assurance" which in the case of fish starts right from the point of catch, ensuring hygienic handling and storage, onboard the fishing vessel. At every stage of handling, transportation, storage, preprocess handling, processing, packaging, storage of finished product and actual transport of the finished product to the end market, strictest standards of hygiene are to be ensured. This needs thorough knowledge of the biochemistry and microbiology of the fish species handled and also the hygiene of the environments. Quality is not hygiene alone. It involves so many other aspects like the quality of the water used for processing (especially in freezing industry). Content of pollutants like pesticides, antibiotics, polycyclic aromatic hydrocarbons etc. in the water and fish and other toxic materials like biogenic amines in the fish are to be constantly monitored and controlled. EU countries insist on such constant monitoring which has necessitated the establishment of good analytical laboratories with fully trained and highly qualified analysts. This human resource development has become a major need of the industry and required special attention in Kollam area. Most of the processing and packaging for the export market takes place in Cochin, with base material being supplied from Kollam landing centers. Some units are also located in Kollam. These are given in the table below.

KOLLAM GROWTH POLE AREA: INDUSTRIES, FISHERIES UNITS

Sl No. Product Details Capacity Numbers Panchayath 1 Mastyafed Chitin.

Chitosan Factory Chitin. 1 Needakara

2 Kerosene Bunks Kerosene 1 Needakara 3 Diesel/ Petrol Bunks iesel/ Petrol 12 Needakara

Shakthikulangara. 4 Boat Building Yards 46 Alappad

East Kallada Mundrothuruth Shakthikulangara

Source : PANFISH Book Kollam District, Department of Fisheries.

FISH PROCESSING AND ASSOCIATED UNITS

Sl No. Type of Units Capacity Product Numbers 1 Ice Plant 15-96 H.P Ice Blocks 37 2 Peeling sheds 15-100 Workers Fish Peeling 62 3 Freeziong Plants 1-15 Tons/day Block Freezing 24 4 IQF Plants 15-100 Tons/day IQF 5 Source : PANFISH Book Kollam District, Department of Fisheries.


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Indicative value chain: As an indicative value chain for shrimp, squid, cuttlefish targeting the domestic markets, the cost of catching 1kg of shrimp squid-cuttlefish is Rs. 135; trading agents procure the same at about Rs. 150, some agents have reprocessing facilities and sell the product to exporters at rate of Rs.162. Exporters sell the items at a rate of Rs. 196, bringing the total value addition to Rs 61. Indicative cost structure: for key actors along the chain, trading agents and exporters, about 90% of input cost, labour cost are about 4-5%, other overheads like power consumables account for the balance. However in certain retails segments like cold stores, ice factories about 60% is the cost of power alone.

There are several ice plants in around these fish landing centres in order to meet with their ice requirements. Since the advent of mechanization and greater availability of raw materials, a small number of seafood processing plants were established in this area. To satisfy the raw material needs of these processing industry a some of pre-processing units/ peeling sheds also were set up. Thus seafood processing industry employs a large number of labour and skilled personnel.

Average Landing Cost of Prawns Rs. 135/Kg.

Average Cost at Pre-processing center Rs.153/Kg

Average Cost Processing center Rs.162

Average Cost at Exporters Rs.185

Exporting Rs. 196

AuctionTrading

Transporting

Peeling, Cleaning

Inspection, Final Cleaning,

Packing, Deep Freezing

VALUE CHAIN: MARINE FISHERIES

All the rates are taken based on the processing of 1 Kg

of Raw Prawns. In pre-processing and processing there is loss of wastages.

The amount shown in the chart is not based on per Kg

of Finished Items. It is based on the exportable quantity available while processing 1 Kg of Raw

Prawns.


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4.4. PEOPLE PROFILE

There are more than 36,000 persons from the Kollam Growth Pole directly involved with the marine fisheries sector. The table alongside indicates that a large proportion of this group is made up of fisher men. Women are mostly involved with pre-

processing and processing, and vending operations. They are also the group with the lowest levels of wages in the sector. During times of the trawler ban these groups are most affected as they are left without employment. The small craft fishermen tend to do better business during the trawler ban as they are permitted to fish in that period. Facilities for these groups are quite limited and in need of attention. The fishing community is mostly concentrated along the coastal strip of Kollam Growth Pole area with several fishing villages located there. Some of these areas located near Kollam town face additional problems arising out of illegal disposal of untreated waste (solid and liquid) along the shoreline. (see pictures on following page) The persons involved with the sector are organized into several groups and this practise has caught up more since the state’s (TRP) and ADB’s (TEAP) Tsunami relief interventions in the last 2.5 years. Some cooperative societies however pre-date these new group-formations and are strong community based organizations in their own right. More than 350 groups exist in the Kollam coastal area that represent fisheries related workers, only the key, registered organizations are discussed below.

FISHERIES CO-OPERATIVES IN KOLLAM DISTRICT.

There are 81 fisheries co-operatives, affiliated to Matsyafed, functioning in the district. Among other activities, they provide loans for fish auction and distribution, and loans to fishermen and women.

FISHERIES AGENCIES AND ORGANISATIONS.

There are around 241 registered Self Help Groups functioning in this area.

Average Income per monthFishermen Rs.2000- 5600

Women trading Rs.2000- 3000Men trading Rs.3000- 12000

Men boat building Rs.3800- 6500 Men Ice Plant Rs.3500- 5000

Women Peeling Rs.1800- 2800

In Growth Pole AreaSector Employment Location

Karunagappally. Shasthamcotta

Fishermen 22759 Kundara.Women trading 2452 Chavara.

Men trading 6148 Thekkumbhagam.Men boat building 672 Thrikkadavoor.Men Ice Plant 185 Mayyanad.Women Peeling 3970 Eravipuram

ThrikkaruvaFisheries 36186


KBIP, GoK

MARINE FISHERIES: STATUS

Municipal solid waste dumping along the shoreline

Untreated sewage and storm water outfalls at the shoreline, near fish landing site: Thangassary

Dwellings of fishing community near Thangasarry landing site; solid waste dump


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VANITHA BANK.

Vanitha Matsya Thozhilali bank under the ownership of Fisheries Department is providing cash credit facility to fisher women folk is functioning at Needakkara.

No. Nature of Agencies Location Numbers

1 Social Service Agencies Needakara 1 2 Non Governmental Agencies Eravipuram 5 3 Charitable Societies 11 4 Voluntary Organisation 5

4.5. INLAND FISHERIES

4.5.1. Cluster Profile:

About 5000 persons are currently involved with this sector performing various kinds of work. Even as all these people are not dependent only on this as their primary income source and a large proportion do other work for most of the days, this number is significant in that it outlined the pressures on the inland lake system, in terms of fishing. The areas where inland fishing activity is most concentrated is Ashtamudi Lake, to a lesser degree in Shastamkotta and also to some extent in the channels feeding into these lakes. The fishing here is of a different nature than the marine fisheries sector and all fishefolk use non-motorised boats and a variety of nets and fish trapping devices.

4.5.2. Process and Product Profile

The following diagram shows process diagram for inland fisheries.

Fishing by Fishermen (various crafts, methods) in Lakes

Fish vendors

Customer (direct purchase)

Landing/ auction centres

(Fishermen’s Societies)

Prawns Pre-processing

Centres (Peeling and

cleaning

Deep Freezing

Local collection agent

District collection agent

Exporters at Chennai

Export grade crab

Prawns processing units (Inspection, Sorting, Packaging)

Dispatch for Export

Prawn


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The example of operations in Ashtamudi lake have been diagrammatised to be representative of the sector. Of the several varieties of fish caught in the inland lake areas, the value chain for crab is shown alongside. This may be compared with a similar product value-chain in the marine-fisheries sector. The inland fisherfolk tend to get a better price for products as there is market differentiation in terms of ‘taste’. In the case of another popular catch, Karimeen, catch from Ashtamudi area fetches upto 30% higher prices in the market.

4.5.3. People Profile

There are more than 5000 persons involved with this sector on a fill-time or part-time basis. The distribution is shown below: Panchayath No. of Crafts No. of Fish vendors

Non-motorised No. of

Fishermen Male Female Kundara 15 30 25 75 Perinad 20 40 100 30 Thrikkaruva 125 250 200 80 Thrikkadavoor 90 180 300 60 Needakara 450 900 700 300 Chavara 110 220 300 125 Thekkumbhagam 350 700 300 150 Killikolloor Area 15 30 15 30 Total 1175 2350 1940 850

Monthly Incomes for the persons involved with various activities in the sector and as given below: Average Income for fishermen Rs. 4200 – 9000 Average Income for fish vendor (female) Rs. 2750 – 3450 Average operating cost per craft/day Rs.50 -100 (Including, ice, fish net repair and replacement) A number of fishermen welfare cooperative societies are here in the Kollam Growth Pole area. Their number is given Grama Panchayat wise, in the table that follows:

Panchayath Fishermen welfare coop Societies (Nos)

Average Landing Cost of Crab Rs. 120/Kg.

VALUE CHAIN: CRAB(Inland Fisheries)

District Collection Agent Rs. 400/Kg

Local Collection Agent Rs.340/Kg

Exporting Rs. 500/Kg


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Kundara - Perinad 1 Thrikkaruva 2 Thrikkadavoor 2 Needakara 2 Chavara 4 Thekkumbhagam 4 Killikolloor Area 1 (Kollam Corporation) - Total 16


Details of government projects for fishery sector and landing site improvement 1. Tsunami Emergency Assistance Project. 2. Tsunami Rehabilitation Programme. 3. Development of Fishing Harbour at Needakkara and Thangassery

(Harbour Department). 4. Coastal Road Development. (Harbour Department). 5. Kollam Port Development at Pallithottam. (Harbour Department).

4.6.1. Credit Linkages and Issues

Credit issues is discussed in the connect of prevailing schemes including the new schemes proposed under the Tsunami Emergency Assistance Program of the ADB. Average cost of 20 feet Non-motorised craft Rs. 30000.00 Average cost of fishing net, insulated boxes etc Rs. 9000.00 Total investment Rs. 39000.00

LOAN SCHEME OF MATSYAFED

This is operated through fishermen welfare co.operative society. For craft and fishing net purchase. Beneficiary contribution 10% 2250.00 Subsidy 10% 2250.00 Loan 80% 18000.00 @ 6% interest Total 22500.00 Repayment period 5-7 years. The gap (39000 - 22500) should be met by the beneficiaries.


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MATSYA BOOTH FOR INLAND FISHING.

(Demo scheme under ADB) 4 cases Beneficiary group costs of 2 males and 3 females from different families. Beneficiary Contribution. 5% Rs. 17600.00 Loan @ 6% 15% Rs. 52800.00 Subsidy 80% Rs. 281600.00 Total Rs. 352000.00

MOBILE FISH MARKETING WITH MARUTHI OMINI VAN WITH FISHER WOMEN DRIVER.

(Demo scheme under ADB) 4 cases Beneficiary group cosits of 6 females from different families. Beneficiary Contribution. 5% Rs. 12500.00 Loan @ 6% 15% Rs. 37500.00 Subsidy 80% Rs. 200000.00 Total Rs. 250000.00 Including working capital and other accessories like crates, insulated boxes, weighing balances etc.

MICRO FINANCING SCHEMES.

SHGs with 5 or more persons Recurring deposits of Rs. 10 or more per week 20 times of deposited amount can be taken as loan with out any security for wedding, land purchase, education, treatment etc. Interest @ 4% for women Interest @ 6% for men Repayment period 1 year. Loan up to 500000.00 for self employment from N. M. D. F. C/ NBC FDC for other backward community and Scheduled Caste/Tribes. Security Landed property or salary certificate. Interest 6% with penal interest of 7%. Repayment period 7 years. Loan for individual women vendors. Beneficiary Contribution 5% Rs. 200.00 Loan Rs. 3800.00


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Total Rs. 4000.00 Repayment Rs. 4500 over a period of 6 months. Refund Rs. 500 as bonus during onam festival season.

PRIVATE FINANCING SYSTEMS.

Loan amount Rs. 4000.00 Repayment amount Rs. 5000.00 To be paid over a period of 3 months.

4.6.2. Feedback from people involved with the sector: Marine and Inland

1. Depletion of species of fishes in the fisheries sector – A variety of species of fish is not available for the past 10 to 15 years – This in turn leads to degradation of marine eco system.

Certain new and unscientific methods of fish harvesting techniques (like

excessive deep sea trawling, usage of nets having reduced mesh size, highly mechanized operation, etc.), which gives an initial high volume and increased profit, is reported to be the major reason for depletion of resources. Over utilization of the available few resources (earlier the number of boats/fishermen operated in fish harvesting was minimal as compared to the present stage) is also a major factor for drastic depletion.

Possibilities for imposing restriction for unscientific methods of fishing may

be explored. Fishermen may be given awareness on consequences of adoption of

unscientific methods of fish harvesting. 2. Income form this sector is minimal - Now a days a family is not able to

survive depending only on the income from this sector. Youngsters are not willing to enter in to this sector due to low income.

Most of the fishermen families are now a days not only depending upon this

traditional sector. At least one member from a family is working in other areas for meeting their family expenses.

Possibilities for better price realization for the catch may be explored. Possibilities of introducing social security and welfare schemes to attract new

generation to this sector may be explored. 3. Non-availability of good quality fishing implements (especially nets) is one of

the problems faced by the fishermen.


- KBIP, GoK 66

It is reported by the fishermen that the nets they are currently using is lasting

only for three to four months. They are of the opinion that the cost effectiveness of the nets is very low. This leads to higher annual investments for nets and other implements and which in turn takes the fishermen to debt traps.

Possibilities for supply of good quality nets and other implements to

fishermen through government agencies at subsidized rate [Kerala State Cooperative Federation for Fisheries Development (Matsyafed)] may be explored.

4. At present, there is no provision for proper storage of fish varieties at the

landing centre. When fish is available in abundance, lack of storage facility leads to poor price

realization or wastage of catch. Possibilities for setting up of a common storage centre as well as processing

centre near by the landing centre may be explored. When fishes like mackerel are in abundance, provisions may be explored for

proper processing, packing and storage of this. Government/Government agencies may adopt means for marketing this in different parts of the country.

5. It is reported that the facilities at the landing/auctioning centre is not

sufficient for the present mode of operation. It is also reported that there is no provision for proper cleaning and maintenance of landing centre.

Provisions may me explored for providing basic facilities and proper cleaning

& maintenance of the landing/auctioning centre 6. Pollution is one of the major threats presently faced by the marine fisheries

sector. Industrial wastes and domestic wastes are dumped in sea and this results in the destruction of marine eco system and subsequently the depletion of resources.

Provisions may be explored for avoiding mixing industrial and domestic

pollutants to sea. Pollution control Board may revise norms for this, as required.

7. The number of exporters operating in the Growth Pole area is less.


- KBIP, GoK 67

Earlier there were fourteen exporters in this area of which four were major players. That time, fishermen were getting better prices. As the four major players along with other three had left this area, fishermen are not getting better/competitive price for exportable commodities.

Provisions may be explored for realizing better price for exportable fish

varieties. Government may explore provision of setting up of Export Unit in the

Government or Co-operative sector. 8. Density of population (fishermen) in the coastal area is very high in this

district. Lack of awareness on proper hygiene practices of the people live in this area causes health hazards.

Awareness campaign on proper hygiene practices may be conducted in the

coastal area. Regular Medical Camps (once in a month or once in two months) may be organized in the coastal areas for avoiding health hazards, if any

4.7. ISSUES AND GAP ANALYSIS

A brief elaboration on critical gaps in different fronts is discussed. These are base on several consultations with different stakeholder groups in the sector. Some of these have been picked up for interventions in the one-year Quality Improvement project. Procurement and supply of inputs:

• It is seen that there is recent decline in some of the species of fishes in this area.

• The unscientific fishing practise, the presence of foreign fishing vessels in the closed proximity of the state with equipped vessels and environmental changes caused a decline in some species. Segment of industry are of the belief that the trawling ban (June-August) is contributing to the supply constraint. The ban has been imposed largely to facilitates breeding of fish and avoid depletion, however, some industry representatives are of the belief that the ‘ban season’ is not appropriate. It is also believed that foreign vessels fish beyond India’s functional waters during this season

• The trawler operators and industry stake holders need explore product diversification fishing from conventional fish verities like shrimp prawns, fin fish, cuttlefish, squid, etc. to tuna. For these purpose long trawlers are


- KBIP, GoK 68

required. Conventional fishing vessels (trawlers) may have to be modified in terms of extension by about 20 feet. Further, appropriate modifications for stocking the catch within the vessels (tuna hanging rods) may be made.

• Consumables such as fishing nets, floats, and paints are currently being supplied by traders to trawler operators and craft owners. Such consumables accounts for a significant portion of their operating costs

• Aquaculture farming options may be encouraged amongst industry as to enhance supply of inputs.

• Presently fishermen in this sector do not have any link with the institutions that are providing data of marine resources based on satellite imaging systems and thereby they have not planned their fishing based on the availability of resources. So they are not in a position to save their fixed expenses (cost of fuel) in a lean period.

• The fish landing centres in this area are not comparable with those in the competing countries. None of the landing centres do not conform to the minimum specification of the leading importing countries. The landing centres are the first stage in the contamination of the product.

• After the introduction of Euro standards and HACCP in fishing industries the demand for pure fresh water is absolutely essential in primary stage of fisheries such as for cleaning the fishes in the landing centre up export. As per the norms of EU the water used for fish processing conforms to 62 parameters. Presently in this sector the dirty sea water is used for washing fishes in the landing centres.

Marketing and Market Development:

• Enterprises including the medium and large exporters in the region could progress towards greater access to market.

• In this area there is no facility for storing the harvested fish. This results in poor economic bargaining in commercial operations as they often finds it difficult to store the material for a better deal.

• Exporters are yet to avail of support under existing GOI schemes offered through the Department of Commerce. This is particularly in terms of establishing warehouses abroad as to optimize freight cost.

• Value added production largely domestic markets by trading agents may be facilitated by refrigerated vans. Subsidy/PPP options may be synergized/evolved. Low value fish such as mackerels could be cleaned in 1or 2 kg consumer package and transported to markets in other Indian States including institutional sales. Tie up with retailing corporate (eg. Reliance) may also be explored in this interest, as may be ties with hotel chain for supply.


- KBIP, GoK 69

• Appropriate options to access markets more conveniently need be considered. Further for procurement of refrigerated trucks the schemes MoFPI need be synergized with enterprise needs. Appropriate PPP schemes may also be evolved to facilitate sharing costs in terms of capital/operating expenditure of such refrigerated trucks by consortia of enterprises.

• Appropriate incubation/pilot plants facilities may be established to facilitate value added production, also targeting domestic markets

Production Technology and Product Development:

• Quality Control: Establishment of a central quality control laboratory is a critical option that mends consideration. The Central Institute of Fisheries Technology and Exports Inspection Agency currently conducts necessary test. However there are several tests as per EU norms that may not be conducted with a existing facilities. The services of centralized labs may be employed for microbial/chemical analysis-pesticide residue and heavy metal contamination etc. The facility may also be used by cashew and other similar food processing sectors in the growth pole.

• Developing technology and implement facilities for value added items • Waste utilization:

Appropriate value addition of waste products, conversion into fish meal may be explored as means to enhance earnings of stake holders-trawler owners as well as auctioneers.

• Unscientific discharge of processed waste to the environment in this area causes a great problem to the environment. The continuous discharge of effluents degrade the quality of the surroundings and affects adversely the water bodies and flora and fauna of the area surrounding the unit. This also affects the other industries and economic operations like tourism adversely. Thus, it brings a catastrophic disaster to the economy by many way.

• High power/electricity costs have been affecting the margin of ice plant factories of trawler operators and also other segments. There is need to explore options of sustainably reducing the costs of power-Electricity in such cases. These ice plant operators are availing of subsidized power supply @ Rs. 3.50 per unit of power. Nevertheless, there is scope for further reduction in cost in sustainable options. The bio-fuel/wind options may be appropriately explored. The option of using coir waste/pith is to be considered.

Finance


- KBIP, GoK 70

• Due to seasonal variations in catch and hence in terms of price of inputs, many exporters are finding it difficult to operate at normal capacity utilization levels.

• It is thus that a significant portion of landed catch is procured from more resource rich exporters from other regions.

• The need for industry stake holders to access appropriate finance as to facilitate stocking of inputs is critical. Financing instruments to facilitate extended stocking of inputs in a consortia mode may be considered –the same has been pursed in a relatively similar fashion in the nearby Kottayam rubber cluster for SSI units.

Policy

• Policy and microeconomics parameters in competing countries such as Thailand have been also affecting competitiveness and value realization by Indian seafood exporters.

• This has been in terms of relatively higher depreciation, in currency, a liberalized import regime by virtue of which about 50% of seafood processed, for re-export is imported from other regions of the world depending on cost advantage. Great investments in aquaculture farming have also contributed to high capacity utilization and hence price competitiveness of Thai enterprises.

• The high incidence of power costs on many segments in the industry such as on cold store facilities, ice-manufacturing units are also an important concern.

• High levels of FDI in competing economics have also enhanced their competitiveness by virtue of helping them upscale economics.

Strengthen industry associations

• The cluster is characterized by, largely tiny and small units in the trawling and trading agent segment. The industry associations representing these categories are relatively weak and industry-institution linkages are weak.

• These associations may offer value added services to members in terms of offering.

• Input negotiation services for members • Serving as a financial intermediary for member units. • Establishing information portal/using a newsletter to continuously

improve the information level of the business member in respect of, schemes and initiatives of different institutions etc.


- KBIP, GoK 71

Skill Up-gradations

• Continued up-gradation of skills of personnel in processing plants operated by exports in the region as well as peeling/pre-processing sheds in the region is critical.

• Training in the area of aquaculture farming is a means to viable alternative to fishing in the depleted high seas.

• Training is also required in the areas of HACCP, quality assurance, sanitation and hygiene in the shop floor.

Physical infrastructure

• Adequate quantity of portable water, proper sanitation facilities for workers and widening of approach roads to landing centers are all critical requirements.

• Appropriate development of fish landing facilities to accommodate long lined vessels need be explored.

• Appropriate purification plants for Pre-processing of Molluses for removing contamination and micro organisms

• Adequate infrastructure is required for supply sufficient quantity of diesel and kerosene. ,

Some Issues raised during consultations with Fisherwomen. Presently Govt is giving 150 litres of Kerosene at a subsidised rate of Rs. 10.50 per litres. The average consumption per month is varies from 35 to 60 litres. They want subsidy for entire kerosene. Need waiting shed for fisher women and vendors. Sanitary facilities required, specially or women.. Landing site- user fees, etc. tonnage, facilities available, management structure etc, issues faced by stakeholders

To summarise, the following are critical areas for intervention in the fishery sector:

• The fisheries sector in its present form though it has the critical numbers is still unorganized in nature and does not have any bargaining power.

• The poor and un-hygiene condition of landing and auction centers. • Un availability of potable water and quality ice at the landing centers. • Poor sanitation and allied issues. • Dumping of wastes including plastics in the sea shore. • Lack of post harvest infrastructure such as cold storages ice plants, peeling centers

fish curing centers and processing plants. • Even though this area is enriched with heavy fish landing, there are very limited

centres for value addition. • Lack of Central Quality Control Laboratories in the growth pole area. • Limited exposure to organized market. • There is no collective effort for boosting up of aquaculture activities. • Lack of proper Training cum product development centre in the area.


- KBIP, GoK 72


Strength

• Traditional base of Kerala sea food industries • Experienced entrepreneurs along the value chain-trawler operators, trading agents and exporters. • Presence of appropriate support institutions in the Growth Pole Area

Weakness

• Inadequate access to appropriate working capital facilities by trading agent/exporters • Small-craft fisherfolk have limited financial/risk taking ability to break out of this • Un hygienic conditions of the landing and auction centers. • Sub-optimal working conditions especially for small fishing boat based community • Scope to enhance availability of potable water (in pre-processing/processing ) • Under exploited potential for processing • Inadequate quality analysis/control facilities. • •Poor price realizations for local community • Inadequate supply of inputs and dearth of initiatives to explore product diversification options. • Relatively weak industry associations

Opportunities

• Potential to evolve appropriate financing instruments for cluster enterprises as to facilitate storing of inputs • Potential to evolve appropriate physical infrastructure (landing centers etc.) • Scope to pursue diversification options into areas such as tuna fishing • Options to establish incubation facilities for value add manufacture • Core factor conditions to explore options to enhance supply of raw materials through aquaculture.

Threats

• Over exploitation reducing varieties of fish catch • External factors like environmental pollution from the town’s liquid and solid waste dumping adds to catch depleting for small-craft based fisher folk • Inadequate efforts to produce value added products may lead to cost competitiveness of cluster enterprises Vis-à-Vis competing countries who have more favorable factor conditions, more rapidly depreciating exchange rates.

4.8. OVERALL INTERVENTIONS

4.8.1. Project approach and sector theme

In the marine fisheries sector the following has been proposed. The diagnostic study and stakeholder consultations have brought out the potential for the development of inland fisheries and aqua culture too but, given the kind of effort envisaged, these aspects will be covered in the larger programme. Four minor landing centres are proposed to be covered over the five-year period. In addition the focus will also be on associated activities and the community in the vicinity of the landing center. Skill diversification is another theme proposed to be addressed in the marine fisheries sector, with the attempt to target the present community involved with this activity, to explore alternative areas in the tourism sector. The idea is not to take them away from their current context but


- KBIP, GoK 73

to make an additional linkage to the common resource (water bodies, shore line, backwaters) through various forms of low impact tourism to insure complementarities.

4.9. INTERVENTIONS: DETAILS, FINANCIALS, FUNDING WITH SOURCE, AND MANAGEMENT

4.9.1. Fisheries Sector: Marine Fisheries

Focusing on the marine fisheries aspect the intervention aims to demonstrate the following:

• Improvements in value addition by improving hygiene in storage and cleaning practices

• Inculcating standard processes in handling, to be used to ensure compliance with food safety and hygiene standards

• Improvement in working conditions through improvements in living and working environment, better facilities, training and availability of amenities at the landing center.

• Cross cutting intervention on overall environment improvement along the shore line for

improved fish catch (value, quality and quantity) food safety (value, quality) community health and environment

4.9.2. Project components

LANDING CENTRES IMPROVEMENT

The initiatives include a demonstration project for upgrading one of the small fish landing centers with all-round improvements in facilities, amenities general environmental conditions of the area including for the locally dwelling community. The aim is to demonstrate these improvements all along a value chain to be able to demonstrate the multiple benefits that accrue to the users, in this case small craft fisher folk, who also dwell along the landing center sites. This is proposed to be scaled up to cover all landing centres over the five-yr period. The state government already has proposals and plans in place for the upgradation of the two large fish landing centres: Neendakara and Shaktiulangara, supported by large infrastructure works that are part of the TRP and TEAP that are already under construction.


- KBIP, GoK 74

MODEL FISH MARKET

A model and modern fish marketing complex is proposed in Kollam town to demonstrate value addition and good practises all along the value chain. Based on the study, an estimated 45 tpm would be the initial capacity and would require about 2 acres of land, with good access and connecting infrastructure, preferably near the outskirts of Kollam Town. See illustrative project details and estimated costs at Annex 4B2

CROSS-CUTTING ISSUES

Among the cross cutting issues, covering both marine and inland fisheries, one of the problems identified is to do with the dumping of untreated sewage and storm water run-off from the town and municipal solid waste, active engagement with the Municipal corporation of Kollam will also be required. Since the waste management component from the municipal areas is already proposed in the overall urban development plan for the Town, (under the proposed loan from the ADB- yet to be approved and processed), this is being flagged under the project as an input from the state government. As the operations and location of the landing centre comes under the purview of the Ports and Harbour Authority and the fisheries department, the proposed plan will require to be taken up with these and other stakeholders for their inputs and approvals. Key stakeholder consultations have revealed that there is scope to include and link various activities with the common waiting area, these have been included in the components outlined below.

INTEGRATION OF LANDING CENTRE, PRE-PROCESSING AND OTHER ACTIVITIES ALONG THE VALUE CHAIN

Project components include the following • Landing center upgradation –Thangasarry:

–Shed improvement –Refrigerated (temperature controlled) sub-section for high value fish –Access road development

• Multi-utility space and waiting area (including for communication, training); Access amenities for local fish retailing –Sheltered waiting area (multi utility space) for fish salespersons –Multi-media communications/training in waiting space (hygiene and cleanliness issues, health, women and child development, enterprise development, waste management, tourism etc etc)


- KBIP, GoK 75

–Sea-food kiosk/canteen for fisher-folk, also general public –Amenities while waiting.

• Waste management initiative in harbour for fish waste, at all locations –Collection system –Awareness and sensitisation

• Infrastructure for value addition -Pre-processing centre / training - Wadi Moothukarra -Solar fish drying demo Wadi-Moothukarra -Drying unit (with solar back-up)

• Ice making unit -Moothukara • Solid waste management, sewerage treatment (components already

included in the Urban Improvement Project of the Government of Kerala pending approval of funding from the ADB), –Address municipal solid waste dumping issue –Sewerage outfall- technical channeling and treatment


- KBIP, GoK 76

4.9.3. Overall Financials

F IS H E R IE S In te rv e n tio n R s la c sA L a n d in g C e n tre

1 T h a n g a s a rryR e n o va te in to s h e d 3 3 .0 0 R e fr ig e ra tio n o f c lo s e d p a rt (V a lu e A d d e d ite m s ) 7 .0 0 R o a d d e ve lo p m e n t 8 1 .5 0 Ic e M a k in g U n it 4 0 .0 0

s u b -to ta l 1 6 1 .5 0

2 W a d iW a itin g ro o m fo r1 0 0 w o m e n + a m e n itie s 1 0 .0 0 T V a n d s p e a k e r s ys te m 5 .0 0

s u b -to ta l 1 5 .0 0

3T h a n g a s a rry , W a d i, M o o th a k k a raS o lid W a s te M a n a g e m e n t in h a rb o u r 2 .0 0

C a p a c ity B u ild in g - a w a re n e s s a n d s e n s itiza tio n 3 .0 0

s u b -to ta l 5 .0 0

4 W a d i, M o o th a k a rraP re -p ro c e s s in g c e n tre C o m m o n (d e m o ) 1 0 0 .0 0 T ra in in g in p re -p ro c e s s in g 6 .0 0

s u b -to ta l 1 0 6 .0 0

B S o la r d ryin g u n it (d e m o ) 7 .0 0 s u b -to ta l 7 .0 0

1 a n d d e ve lo p m e n t) 7 .0 0

2M o b ile V e n d in g U n its (c o m is s io n in g ) 4 0 .0 0

s u b -to ta l 4 7 .0 0

DF is h p o s t-h a rv e s tin g in fra s tru c tu re

1 F is h m a rk e t - s ta te o f th e a rt K 1 ,3 0 0 .0 0 2 S m a ll F is h L a n d in g C e n tre 1 6 0 .0 0 3 S e a F o o d P a rk 1 ,4 5 0 .0 0

s u b -to ta l 2 ,9 1 0 .0 0

E

U p g ra d a tio n o f M a in L a n d in g C e n tre s : N e e n d a k a ra a n d S a k tiu la n g a raF a c ilit ie s U p g ra d a tio n + L a n d in g A re a 8 9 0 .0 0 P e e lin g s h e d a n d c o m m o n p re -p ro c e s s in g c e n tre (M P E D A P ro je c t) 1 1 4 .5 0

s u b -to ta l 1 ,0 0 4 .5 0

M A R IN E F IS H E R IE S T o ta l 4 ,2 5 6 .0 0

IN L A N D F IS H E R IE ST ra in in g a n d s e n s itiza tio n 1 5 0 .0 0 T ra in in g o n :M a n a g e m e n t o f la k eW a te r a n d e n v iro n m e n tL in k a g e to f is h c a tc hIN L A N D F IS H E R IE S T O T A L 1 5 0 .0 0

F IS H E R IE S T O T A L 4 ,4 0 6 .0 0


- KBIP, GoK 77


• MatysFed • Kudumbashree • Port Trust

o MoU with Fisherman’s association / women’s groups • KBIP • MPEDA • Dept of Fisheries

o Development of Integrated Landing Centre Project

• KINFRA, MPEDA o Development of equipment Technology

• Municipal Corporation of Kollam • PRI

o Identification of beneficiary groups for inland fisheries • BDS providers

o Skill development o Sensitization

4.10.1. Funding sources and schemes

Centrally sponsored scheme on development of Marine Fisheries, Infrastructure and Post-Harvest Operations provides for upto 50% of cost of development of fish landing centres, infrastructure and post-harvest operations including vending units. Other specific schemes and sources have been identified alongside each qualifying component, in the following table.

FUNDING SOURCES

See Table


- KBIP, GoK 78

% eligible under various heads

Amount in Rs lacs Source(s_

FISHERIES

Intervention Rs lacs GOI GOK Users

Pvt sector/banks

NCEUS

GOI GOK Users Pvt sector/banks

NCEUS

A Landing Centre 1 Thangasarry

Renovate into shed 33.00

50% 16.50 - - - 16.50

CG Dev of Infrastructure Facilities

Refrigeration of closed part (Value Added items)

7.00 50%

3.50 - - - 3.50 CG Dev of Infrastructure Facilities

Road development 81.50

0% 100% - 81.50 - - -

GoK already proposed under TEAP

Ice Making Unit 40.00

0% 100% - - - 40.00 -

Private sector player

sub-total 161.50 0% 20.00

81.50 -

40.00 20.00

0% - - - - -

2 Wadi Waiting room for100 women + amenities 10.00

50% 0% 5.00 - - - 5.00


TV and speaker system 5.00

50% 0% 2.50 - - - 2.50


sub-total 15.00

0% 7.50 - - - 7.50

0% - - - - -


- KBIP, GoK 79

3 Thangasarry, Wadi, Moothakkara

Solid Waste Management in harbour

2.00 50% 0%


Capacity Building - awareness and sensitization

3.00 50% 0%


sub-total 5.00

0% 2.50 - - - 2.50

0% - - - - -

4 Wadi, Moothakarra Pre-processing centre Common (demo)

100.00 50% 0%


Training in pre-processing 6.00

50% 0% 3.00 - - - 3.00


sub-total 106.00

0% 53.00 - - - 53.00

0% - - - - -

B Solar drying unit (demo) 7.00

50% 0% 3.50 - - - 3.50


sub-total 7.00

3.50 - - - 3.50


0% - - - - -

1 Mobile Vending Units (design and development)

7.00 50% 0% 10%

3.50 - 0.70 - 2.80


- KBIP, GoK 80

2 Mobile Vending Units (comissioning) 40.00

50% 0% 50% 20.00 - 20.00 - -

sub-total 47.00

0% 23.50 - 20.70 - 2.80

D Fish post-harvesting infrastructure

1 Fish market - state of the art Kollam 1,300.00

45% 23% 20% 585.00 300.00 260.00 - 155.00

2 Small Fish Landing Centre 160.00

50% 10% 80.00 - 16.00 - 64.00

3 Sea Food Park 1,450.00

31% 69% 450.00 - 1,000.00 - -

sub-total 2,910.00

0% 1,115.

00 300.00 1,276.00 - 219.00

E Upgradation of Main Landing Centres: Neendakara and Saktiulangara

Facilities Upgradation+Landing Area

890.00 100.00

%0 890 0 0 0

Peeling shed and common pre-processing centre (MPEDA Project)

114.50 91.27

%8.73% 104.50

415 0 0 9.99585 0

sub-total 1,004.50 104.5042

890 0 9.9959 0

MARINE

FISHERIES Total 4,256.00 31% 30% 30% 1% 7%

1,329.50

1,271.50 1,296.70 50.00 308.30


- KBIP, GoK 81

INLAND FISHERIES

Training and sensitization 150.00

0% 0% 0% - - - - 150.00

No Central Scheme available

Training on: Training Management of lake 10 groups Water and environment

5 people each

Linkage to fish catch 30 days INLAND

FISHERIES TOTAL 150.00 - - - - -

- - - - 150.00 Rs 1000 per day

FISHERIES TOTAL 4,406.00 30% 29% 29% 1% 10%

1,329.50

1,271.50 1,296.70 50.00 458.30


KBIP, GoK 82

4. C. COIR SECTOR

Coir is known as the precious gift and pride of Kerala. A very important traditional industry, it employs nearly 3.75 lakhs of workers with nearly 76% of them being women folk. Ever since the sector came up, the Government has been extending support for its growth through welfare measures for the workers. Unfortunately, neither the growth of the industry nor the living condition of the Coir Workers has been to the targeted level. In spite of the efforts of the Government, the Coir Industry is still a ‘sick industry' that continues to battle for survival in the field of competition with products of other natural as well as synthetic fibres both in domestic and international markets. Problems of non professional management in the Co-operative Sector, and the Managing Committees, the hesitation of the Union Leaders to accept mechanization and modern technologies, shortage of availability of husk due to disease and extensive use of tender coconut, absence of any efficient system of uninterrupted collection or procurement of the available husk, the Societies' over dependence on Governmental assistance, unhygienic surroundings and conditions of the work area of traditional retting and beating operations etc. have resulted, among other things, in reduction of fibre production in the state and consequently in acute shortage of fibre and unprecedented increase in the price of fibre in the state as it has to be purchased from elsewhere.

4.1. CLUSTER PROFILE

The Coir cluster in the Kollam Growth Pole Area has a turnover of about Rs.58 crores. Exports account for about Rs. 9.8 crores (16.9%) of this figure. Exports comprise coir yarn and relatively more value added products such as geo- textiles manufactured in the cluster. These items are exported via Alleppy-based agents. Enterprises largely operate at the lower end of the value chain - manufacturing only coir yarn. There are about 2000 cottage and 20 tiny yarn spinning units in the cluster operating in the private, largely informal sector. There are about 90 units functioning Co- operative societies, involved in similar activity. The Growth Pole Area has 2 de-fibering units of the ones currently operational in the growth pole area. The cluster provides employment to about 51,683 workers, with direct employment to 34,218 persons. In addition, some people also engage in coir related activity on a part-time basis due to inadequate supply/availability of fiber and relatively poor productivity and wages (see table in People Profile sub-section)


KBIP, GoK 83

The two most significant production distribution channels include that of the tiny and cottage yarn spinning segment and that of the Co-operative spinning segment respectively. Both segments largely target the dealer markets, which in turn target the North Indian markets. Tamil Nadu and other such markets in the Southern area are catered by spinning units in those regions most of which employ automatic ratts, which have greater productivity. The input, which is procured @ of about Rs.500 for 85 kgs of fibre, is finally sold upon value addition (Spinning of yarn) to about Rs: 1600 per 80 kgs spun yarn.

4.1.1. Background

The Coir Sector was originally started by the Government of the erstwhile Travancore state in 1950 and ever since the Government has been extending support to it. The sector faces problems and challenges to its sustained growth on so many fronts that it has resulted in the stunted growth of the industry and poor living condition of the coir workers. Coir is a biodegradable organic fibre and hardest among other natural fibres. Coir is used commercially for the manufacture of a wide range of products for various end-use applications. The fibrous material forming part of the soft mass surrounding coconut, the fruit of the tree “Cocos Nucifera” or the coconut palm is world over known as coir. Coconut husk is the raw material for the coir industry, which is available in enormous quantities wherever there is large-scale coconut cultivation. The palm is essentially a plant of tropics and it thrives within 20° of the equator. Philippines, Indonesia, Thailand and neighboring islands, India, Srilanka, pacific territories, east and West Africa and the West Indies are the important coconut producing countries in the world. India and Srilanka account the major contributions out of the above. Coconuts are usually harvested at the end of every 45 days all throughout the year.

Coir is a versatile hard fibre obtained from the husks of coconut. The Coir fibre is one of the hardest natural fibres because of its high content of lignin; Coir is much more advantageous in different application for erosion control, reinforcement and stabilization of soil and is preferred to any other natural fibres. The fibre is hygroscope, with moisture content of 10% to 12% at 65% humidity and 22% to 55% at 95% relative humidity. Of all natural fibers coir processes the greatest tearing strength, retained as such even in very wet conditions The physical appearance and quality of the fibres varies widely. The color of the fibre


KBIP, GoK 84

is not only influenced by the species of the nut from which it is derived but also its maturity, time lapse between dehusking and retting etc. However under identical conditions of these variables, the fibres extracted from infant nuts exhibit a pale yellow color. The intensity of color and thickness increase with age and the fibres are remarkably stiff and posses good extensibility. Morphologically, coir is a multi cellular fibre with 12 to 24 microns in diameter and the ratio of length to thickness is observed to be 35. Cells of the fibre surface are occasionally covered with the silicised stigmata. The chemical constituents have found to be cellulose, lignin, hemi cellulose and pectin. The percentage of the ingredients in the fibre is largely governed by the age of the nut from which it is derived. Cellulose and lignin are the major constituents and higher lignin content makes the fibre stiffer and tougher.


The usual practice in hand spinning is to roll the fibre into short length of 6 to 9 inches, giving a clock-wise twist by hands. When a sufficient quantity has been made, two of these short lengths are taken in hand together and made into yarn of two plies by giving a counter twist, using both palms.

Husk Procurement

Retting

De-fibering

Yarn Spinning

Traditional Ratt Spinning

Drying Coir Yarn

Bundling

Dispatch

Semi automatic Ratt spinning

Fully automatic spinning

Drying Fiber

Pith (byproduct)Saline Pith (byproduct)

PROCESS FLOW CHART FOR COIR YARN


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Coir Yarn is generally of 2 ply, spun from coir fibre by hand as well as with the help of traditional ratts, fully automatic spinning machines etc. The Coir yarn is of different qualities/grades based on the quality of fibre used, the nature of twist, presence of impurities etc. Available in different forms like hydraulically pressed bales, spools bobbins, dholls, balls etc. cut length for various industrial and agricultural purposes. Hand Spinning The usual practice in hand spinning is to roll the fibre into short length of 6 to 9 inches, giving a clock-wise twist by hands. When a sufficient quantity has been made, two of these short lengths are taken in hand together and made into yarn of two plies by giving a counter twist, using both palms. When the counter twist reaches near the end of the striking, further pieces of short lengths kept ready are added one after other, while the counter twist by hand is continued till the required length of yarn for a knot is reached. This is reeled in the form of a hank and a knot is made at the end. Handspun yarn always has a soft twist. Traditional Ratt Spinning Spinning is usually done on the 'Charka' or spinning wheel. Wheel spinning is gradually displacing hand spinning. From the middle of the 19th century, coir spinning wheels have been introduced with a view to increasing production and obtaining the hard twist required for the manufacture of matting, etc. To prepare two-ply coir yarn on the spinning wheel, one set of two wheels, one stationary and the other movable is required. The stationary wheel usually contains two spindles set in motion through the centre of the wheel. The movable wheel contains one spindle only. Two persons take the silvers of 'coir' prepared and kept ready after willowing.


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Usually women keeps them in their arm pits, make a loop with a small quantity of fibre and then puts the loop thus formed into the notch of one of the spindles on the stationary wheel and gives the fibre a uniform thickness while walking backward.

Another operator then gives the twist to the fibre thus led by turning the handle of the spinning wheel. This operation is continued till the required length of strand is reached. The strands are then passed through a grooved rod and tied together into the notch of the spindle, the grooved rod being allowed to move forward. The movable wheel is turned in the opposite direction. The object of the grooved rod is to regulate the twist of the yarn and to prevent entanglement of the strands at the time of doubling. When the grooved rod reaches the stationary wheel, the turning of the spindles of the spinning wheel is stopped and all the ends from that of the stationary wheel are cut off and the yarn is tested to see whether there is sufficient twist. If more twist is required, the movable wheel is turned toward its original direction till the required twist is obtained, if it contains more twist than desired, the movable wheel is turned in a direction contrary to the original twist.Traditional Wheel spinning using a spinning wheel requires three people, who may produce 12-15 kg of yarn per day. Motorised Traditional Ratt Motorised Traditional Ratt is a developed form of a coir spinning 'charka'. Here, the stationary ratt is rotated using a suitable contrivance attached to an electric motor. By attaching the rotating system to the stationary ratt one worker is avoided and the productivity is increased. The wages thus earned are divided among the two workers resulting in enhancement of wages of spinners. This system has been introduced recently and found successful in the industry for spinning all varieties of yarn. Motorised Ratt


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The research and development in coir industry was mainly aimed for reducing the drudgery of the workers involved in the spinning of coir yarn on traditional and motorised traditional ratts. Two or three spinners are engaged for exercising the production activity in yarn spinning, where they are exposed to changing weather conditions, which ultimately affects the production. They are also forced to walk up and down in the spinning yard for taking the individual strands and for doubling operation. It was a long time dream of the coir industry to introduce a contrivance for reducing the drudgery of the labourer and improve the productivity and also enhance the earnings of the workers engaged in the spinning As a result of research and development, a spinning device for attaining the real goals of reducing the drudgery, improving the productivity and to improve the working environment, the motorised ratt was introduced in the industry. In the case of a motorised ratt the spinner is made to sit on a chair /stool and roll the well cleaned fibre stacked in the spinning trays attached to the spinning device where the yarn is spun and wound over the bobbins attached to the ratt. The simple device is now popular in the industry and the benefit of the device has been extended to all spinning areas, all over India. Coir board has taken all efforts to popularise this spinning device and a scheme has been evolved under 'Mahila Coir Yojana Scheme' for providing motorised ratt to spinners at a subsidised rate. The introduction of the motorised ratt in the industry has paved way for increasing the employment opportunity certain extent, as some of the new generation has taken up the spinning activity in the coir sector as the change in the working environment. All varieties of coir yarn in the industry are produced on ratt with a slight alteration on the equipment.


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In total there are around 8000 ratts including Traditional Ratts, Motorised Traditional Ratts and Motorised Ratts in both private and co-operative sector. Total number of active workers presently employed in this sector is 51683 only. The coir industry concentrated in the growth pole are in Karunagappally, Chittumala, Chavara and Anchalammood. In this growth pole area, mainly Mangadan variety of coir yarn is produced. Mangadan Special, Neeravil special, Paravoor Anjengoare some of the special varieties in this area (details regarding the varieties, later in this sub-section). The quality of this yarn produced in the cluster is such that it is said to not be conducive for all varieties of mats and matting production. It is mainly used for bundling and scaffolding work in thee construction industry and in agriculture. There is severe competition from synthetic yarn in this field. This restricts the market scope of coir yarn.. The cluster is characterized by tiny and cottage level spinners with between 3-4 ratts are used. The co-operative sectors currently market their products through Coir Fed, which is the apex body of the co-operative societies.

4.3.1. Important Trade varieties of Coir yarn and its Specification

The following are the main types of coir yarn spun in the growth pole area. Anjengo A Wheel spun yarn, spun from long or medium stapled, natural bright golden coloured, well cleaned coir fibres extracted from properly retted husks containing little or no pith, husk, sand, etc. appreciably very less hairy, hard twisted both the single strand and the two plies of yarn; mostly evenly spun and uniformly twisted, smooth textured in appearance. The runnage ranges from 200 mts to 360 mts & above. Anjengo M ( Mangadan Yarn) Wheel spun yarn; from long or medium stapled, natural bright golden coloured, well-cleaned coir fibres extracted from retted husks; containing little or no pith or husk and varying percentages of sand; some what hairy; hard twisted-both the single ply and the two plies of yarn are more hard twisted than Anjengo A yarn. Thus Anjengo M being the most hard twisted of all the varieties falling under hard twisted yarns; The runnage ranges from 140 mts to 190 mts. Aratory Wheel spun yarn; spun from long or medium stapled coir fibres extracted from retted husks and of colours ranging from slight reddish brown to bluish grey;


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containing very small amounts of pith, husk and also sand, appreciably hairy, fibres not teased properly; slightly dirtier in appearance than Anjengo A and Anjengo M; The runnage ranges from 200 mts to 260 mts & above. Imitation Alapat / Ashtamudi / Caruva Wheel spun yarn; spun usually thicker than Anjengo A, Anjengo M; Aratory or Real Alapat; from less cleaned coir fibres extracted from retted husks; brownish to grayish in colour, containing a small amount of sand, husk and short fibres; hairy and less clean in appearance compared to Anjengo A or Anjengo M. The runnage ranges from 90 mts to 140 mts up. Real Alapat Failing under the class of soft twisted yarns, Real Alapat is spun both by wheel and hand from coir fibres, extracted from retted husk; and of shades ranging from bright golden colour to bright brown or grey. The hand spun yarn is softer to touch and more uniform in twist; containing little or no pith; smooth textured and not hairy; soft twisted-both the single strand and the two plies are soft twisted. The runnage ranges from 170 mts to 230 mts up. Vycome (Weaving) Yarn spun both by hand and wheel, mostly the latter, from bright coloured, fairly well cleaned coir fibres extracted from retted husks characterised by the very soft textured appearance; containing small amounts of pith, husk and sand but no dirt; somewhat hairy soft and light in appearance; fairly even in thickness and twist ; fibres are not teased so well as in Anjengo A and so lumps of entangled fibres are found frequently in strands of yarn. The runnage ranges from 200 mts to 300 mts & above. Beach Hand spun yarn; spun from inferior types of coir fibres extracted from unsoaked or inadequately retted husks; the fibres are insufficiently cleaned and of very reddish brown in colour; containing a very large amount of pith but not sand; the fibres being in an unopened state lie adhering to each other in the yarn with a lot of pith; little or no hairiness; very soft twisted with the single strand practically lying untwisted. The runnage ranges from 240 mts to 260 mts. Roping Hand spun yarn; spun from coir fibers which are less cleaned and extracted from inadequately retted husks; containing varying amounts of pith; characterised by its extraordinary thickness; unclean in appearance; very less hairy.


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The runnage ranges from 50 mts to 60 mts & above. Beypore Hand spun yarn; spun from coir fibres extracted from insufficiently retted husks; of bluish brown colour comparable in thickness to thinner types of roping; containing small amounts of pith and husk; less dirty than the other types of inferior varieties of yarns. The runnage ranges from 70 mts to 90 mts Beypore - Z Hand spun yarn; spun from coir fibres extracted from insufficiently retted husks; of bluish brown colour; comparable in thickness to thinner types of roping; containing small amounts of pith and husk, less dirty than the other types of interior varieties of yarns. The runnage ranges from 70 mts to 90 mts Quailandy Hand spun yarn; spun from fairly well cleaned coir fibres extracted from retted husk, natural bright golden to greyish in colour; similar in appearance and texture to Ashtamudy; fibres being insufficiently opened lie adhering to each other in the yarn. The runnage ranges from 110 mts to 130 mts

4.3.2. Value chain analysis

Coconut husk ( 1000 Nos) Rs 800

Retting and defibring (80 Kg Fiber)

Rs 292

Yarn Spinning Rs 954

Coir yarn( 78 kg coir yarn) Rs 2262

VALUE CHAIN OF RETTED COIR YARN


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The same is represented with costs in the table below, with component-wise costs

Cost and procurement expenses of 1000 husks Rs 800.00 Retting and defibring a) Expenses for retting in backwaters or brackish water Rs 157.00 b) Expense for skin removal Rs 100 c) Expenses for mechanized beating Rs 35 Total Rs 292

Yarn and Spinning Fibre cleaning Rs 25.00 Women workers required 12 Nos Labour charges 12* Rs. 77 Rs 924 Bundling charges Rs 5 Total Rs 954

Coir yarn 78kg* Rs 29 Rs 2262.00 % Margin Rs 2262-2046

2046 Margin 10.557%

4.4. PEOPLE PROFILE

Cluster enterprises are largely operating at the lower end of the value chain in terms of manufacturing only coir yarn. There are around 2000 nos of cottage units, 20 nos of tiny units are functioning in private sector. In general the coir industry consists of two major sectors- Spinning and manufacturing. Absence of regularity in production and opportunity for full time occupation have resulted in very poor annual earnings for the most of the workers forcing them to live below poverty line. (see table alongside) Co-operative Sector. Number of working Co- operative Societies 66 New societies not yet started production 9 Dormant 47 Liquidated 21 Total 143 Number of registered members. 51683.

Average Income per month

Women Workers Rs. 1080- 1500Women Workers

in mats Rs.1600- 2400Men Workers Rs. 2500-3000

Men Workers in defibering unit Rs 3000-3500

Men Workers in mats Rs.3500-5750


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Number of registered workers 48817 Male 19722 Female 31961. SC 5987 No. of workers employed during 2005-2006 1627 Mats & Matting Societies. No. of mats and mating societies 2 No. of working mats and mating societies Nil. No. of registered workers 217 (Male – 217, Female -32) Defibring Mills . No. of Defibring Mills Societies. 8. No. of private units. 2 Production of coir in co-operative sector. 779.05 M.T. Total value of coir produced in co-operative sector 1.92 Crores In total around 8000 ratts including Traditional Ratts, Motorised Traditional Ratts and Motorised Ratts in both private and co-operative sector. Total number of active workers presently employed in this sector is 51683 only. The coir industry concentrated in the growth pole are in Karunagappally, Chittumala, Chavara and Anchalammood. Several pointers regarding the actual numbers working in this sector have been given during interactions in the field. It is understood that as the sector has become less and less remunerative, the workers have started diversifying to other, better paying jobs, though they may take these up as part time assignments. One consultation with a focus group revealed that 40% of the workers in the Cashew sector were previously involved with the coir sector and continue to have their memberships.


4.5.1. Backward linkages

In Kollam district 35 crores of coconut are produced in 205 lakhs acres of of land and 15 crores in Pathanamthitta district. Out of this only 10% are procured for producing coir presently. 75% of fibre produced in Pollachi area- Tamilnadu is transported to Kollam area. Coir Yarn is generally of 2 ply, spun from coir


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fibre by hand as well as with the help of traditional ratts, fully automatic spinning machines etc. The Coir yarn is of different qualities/grades based on the quality of fibre used, the nature of twist, presence of impurities etc. Available in different forms like hydraulically pressed bales, spools bobbins, dholls, balls etc. cut length for various industrial and agricultural purposes.

4.6. ISSUES AND GAP ANALYSIS

Procurement and Supply. Supply in terms of production of husk in the Kollam region is significant. However, only a small proportion of husk is collected and productively exploited. A hush collection mechanism need be evolved. This could be in terms of networked initiatives involving Kudumbasree women SHGs, who are providing, wheel barrows for husk collection. Collection centers may have to be established in a decentralized fashion across the district from where tiny/ cottage units as well as Co-operative society enterprises could source inputs. The husk potential per annum is about 3900 lakhs in the growth pole region, nevertheless hardly a few lakhs are actually collected due to inadequate development of an appropriate collection mechanism. As a matter of fact study is by the coir department and Coir Welfare Board indicate that even if 30% of the available husk potential in the region is adequately exploited, there is scope for establishment of about 50 de-fibering units (average capability of 8000 husk per day) Marketing and Development Marketing strength may be developed by enterprises only upon acquiring higher productivity levels and optimizing procurement. This may be in terms of ratts upgradation and raw material banks; improved collective collection of husks may be associated with this bank. These would also lend a cost advantage.

• Poor direct market access to consumers affects the potential margin of spinners as well as Co- operative societies.

• Evolving network/consortia to operate marketing out lets and directly supply to retail outlets/ export, value added products, by means of offering volumes is an option.

• Enterprises are suffering from inadequate market access to corporate /fair trade Exim promoting agencies. For access to export market, however, manufacture of value added products such as geo-textiles and mats are necessary.


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COIR PROCESSING

1. and 2. Heaps of coconut husk for retting – done through the traditional method of soaking in the backwater for 6 months. This is harmful to the environment and a banned practise. 3. Pith, obtained from the defibring process after retting. This, cleaned of salts has tremendous market potential 4. New technology based machines for making yarn- the uptake has been limited 5. Piles of saline pith lie unused

1 2

3 4

5


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Finance

• Working capital facility to tiny and cottage units could greatly enhance the bargaining power of the in formal sector spinners. Most spinners are strapped for cash and pay an exorbitant cost to husk and fibre suppliers (invariably) for credit purchase inputs. The mark upon credit sales by raw material suppliers is up to 20% !

• A similar modus- operandi need be explored for strengthening Co-operative sector enterprises that are also invariably cash starved for working capital.

• The Mutual Credit Guarantee Fund (MCGF) option of SIDBI may be explored for this purpose . Over 100 consortia have been financed on a similar mode in the coir cluster at Alleppy by FIS.

• Scope to synergies CGTSI scheme for individual financing sans collateral to micro/tiny enterprise consortia as has been pursued by SBT finance at the coir cluster at Alleppy. Such may also be availed for upgradation at the individual enterprise levels.

Training and skill up gradation

• Proper training and skill up gradation are necessary in the cluster so that the quality of fiber available and spinning in the cluster and ultimately the quality of the products are improved. So the scope for marketing the products such as Coir yarn , ropes and geo textile are quite improved and there by a sustainable cost advantage is derived.

• Appropriate establishments and subsequent functioning of semi-automatic or fully automatic ratts would required for skill development of the cottage level spinners.

• However for this purpose decentralized training institutions with pilot plant may be established by NGOs / consortia of private and Co-operative spinners, as has been established in the coir cluster at Alleppy.

• Training is required to facilitate manufacture of value added products such as geo textiles, matting, coir polymer composite boards, composite pith blocks, coir handicraft items etc .


Strength • Traditional skill in spinning • Established market linkages and support institutions (Coir Fed and Coir Board show rooms) to facilitate the marketing function. • Presence of coir departments field

Weakness • Poor husk collection facilities / systems affecting competitive availability of husk . • The particular variety, “Mangadan” coir has limited application in the matting sector.


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office to facilitate necessary training / other interventions related to cluster development.

• Informal sector enterprises operating in the lower end of the value chain with scant resources to invest in technology or value added production with out fiscal assistance. • Inadequate de-fibering capacity. • Limited access to institutional finance.

Opportunities • Exploit scope for producing value added products such as geo- textiles competitively (with forward linkages) • Enhance competitiveness through better financing institutions to avoid cost of credit purchase. • Employment of decentralized CFCS to facilitate de-fibering units, ratts and semi- automatic loom manufacture. • Exploit opportunities to enhance utilization of under utilized husk potential in the growth pole area.

Threats • Sector not attracting new investments or employees, given work methods and condition • Supply constraints of husk affecting capacity utilization of cluster enterprises and hence competitiveness • Competitive threats from spinning units employing automatic ratts in other states such as Tamil Nadu . • Inadequate profit margin leading to exist of labour force from the spinning sector.

4.6.2. Overall Potential areas of Development

• Establishment of a husk collection mechanism upon networking with Kudumbasree/ NGOS- SHGS. Collections centers may also have to be established in a decentralized fashion

• In the case of de-fibering units, the cost of power are significant. As a competitiveness oriented option, scope for employment of bio fuel –coir pith/ husk etc. may be explored

• Establishment of decentralized CFCS across the growth pole area These CFCS would offer modernized fully mechanised defibring and even ratt facilities for coir spinning units (both the ‘private’ sector as well as the co-operative segment). Decenterlized CFCS for geo textile manufacture could also be upgraded. Similarly CFC for Coir Pith and briquettes, Composite Boards, Needled felt pads etc manufacturing could be set up in the cluster.

• Effective steps to set up coir tufted mats manufacturing unit in the growth pole area by attracting private entrepreneurs, which have very high export potential and can be explored.

• Evolution of consortia /SPVS amongst private sector as well as Co-operative sector enterprises to established decentralized CFCS in PPCP (Public Private Community Partnership) basis.

• Exposure visits to similar successful interventions in Allepply coir cluster (intervention by coir board, SBT and SBI ), Coir Cluster at Pollachi as well as handloom cluster at Kannur.


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Apply Green decortication and microbial treatments New environmentally friendly methods for fibre production are of interest. These can be locally exploited on relative small-scale, and have the potential to produce a more constant quality of fibres. Novel developments by the Central Coir Research Institute, under Coir Board, using a biotechnological approach with specific microbial enzymes have reduced the retting time substantially. High quality fibre production has been maintained.

• There is inadequate capacity in terms of de-fibering units. There are only two de-fibering enterprises in the cluster. They are private sector operators. The de fibering units in the Co-operative sector have not been up to the mark.

• For traditional backwater retting at least 7-10 months are required. So there is blockage of working capital. This practise has already been flagged as environmentally damaging and is being regulated.

Coir Pith Coir Pith is generated in large quantities in the major coir production centres. Extraction of 1 Kg. of coir fibre on an average will leave 2 Kgs. of Coir Pith. Large hillocks of Coir Pith are a common sight in the growth pole area.. Coir Pith was considered as an agro waste in the yester years. In this area, the Coir Pith was used largely for reclaiming the wetlands and it create so much environmental issues. The coir pith or coir dust, which is the spongy residual material, is a by-product of fibre extraction, which has caught the imagination of the horticulturists. It has immense potential as a soil conditioner and moisture-retaining medium for horticultural applications. It is widely being used in nurseries as a plant grows out medium especially in hydroponics. Its demand is on the increase due to the restrictions being imposed on mining of peat moss. With quality assurance, this product can find a ready market, either as such or as composted material. But the potential end users are not fully aware of its advantages, and the promotional efforts have not been adequate. There is dearth of testing facilities and recognized certification agencies in the producer countries. Other garden articles like plant liners, baskets, grow bags, shredded husks, and bit fibres are also in demand for orchid and other cut flower cultivation in the large and growing Market Garden sector.

• The potential for manufacturing Coir Polymer Composite Board may also to be explored which is substitute for other composite boards. The Coir Research Institute, Kalavoor has already developed the technical know-how for making this item.

Marketing Interventions

• . Evolving consortia /network amongst spinning enterprises and cooperative societies could help them together and jointly offer volume and supply to retail /outlets/exporters etc. The value addition in terms of Geo textiles and matting manufacture is also critical.

• Establishment of links with fair trade agencies and developmental nodes such as the Cell/ Center for Social Responsibility of the CII could help


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enhance the market access and exports orientation of the spinners who are all in the informal sector.

• Linkages with traders such as (Korea Trade Authority) KOTRA and the relevant chamber of commerce could facilitate exports of Goe- textiles in Korea and similarly to other countries. Sri Lankan goe- textile exports are largely oriented towards, South Korea at present.

4.7. PROJECT APPROACH AND SECTOR THEME

This traditional, old and well-established sector is currently faced with a number of problems through the length of its value chain. Whilst there is great need to take more intense and sector-wide initiatives, the strategy proposed will be broad-based with a focus on the initial aspect of collection more intensely, in the initial part with a number of diversified product manufacturing options that may be selected and added subsequently.

The theme for the one-year project concentrates on collection efficiencies in the process, to begin with, and attempts to derive greater value from the collected material by utilizing not only the husk but also the shell. In addition to deriving greater value, this aspect addresses the need for an additional source of income through skill diversification. Also, demonstration of process efficiencies throughout the chain by taking in two defibring units on a pilot basis and linking them with cooperatives. Subsequent stages will require these to be scaled up to cover 5 or more (as required defibring units and similarly linking and diversifying to use the resource intensive model suggested.

4.7.1. Proposed Interventions

The initial interventions in this sector are designed to address the early part of the process: collection, defibring and risk-offsetting through skill diversification.

COLLECTION

SHELL

HUSK

P

Processing

Processing Market

Market

Market

Processing and conditioning

Spinning Defibring Matting

Cutting & polishing


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Efficiencies in collection are likely to be achieved in the model project period with greater value being obtained from the resource through product diversification. The subsequent parts of the coir processing value chain are addressed in subsequent stages of the Growth Pole Programme with a parallel scaling up of this initiative. The overarching objective is to revive Kollam as a preferred production centre with a concurrent strategy of skill diversification to reduce dependence on a single source. Along with this, to achieve improved incomes through resource maximization (from the collected nuts, using the husk towards yarn and making shell-based products from the previously-discarded shell, ensuring two --or more-- sets of value addition) The following diagram represents the phases of the process in the proposed integrated and diversified model. The second matrix represents the nature of support required to be available along with the coordination with later aspects, to achieve the functional degree of integration required. These have been included in the budgeting process and the key elements have been stressed to emphasise the primary integration requirement, for its success and overall optimised functioning.

COMMERCIAL EXPLOITATION OF COCONUT PITH Coconut pith is a spongy, highly hygroscopic, extremely compressive and has a good percentage of combustible matter with low ash content. The calorific value of unretted pith is greater than that of retted pith. Accordingly, unretted pith i.e., pith available from the mechanical defibring industries can be utilised for producing fuel briquettes to be used as substitute fuel in place of firewood used in tile and brick industries and for other industrial heating purposes. Retted pith which is having a better water holding capacity can be used as water retention material in sandy soils and also as an insulation material with other suitable additives since it has a low thermal conductivity. Coconut pith available from the mechanical coir defibring units is sieved through an IS 8 mesh sieve to remove long coir fibres and mixed with 20 per cent cow dung in the form of slurry. The mixture is aged for about 24 hrs. and then passed through an extruder to produce hollow cylindrical briquettes which are subsequently dried in the sunlight. The success of briquetting will depend upon consistency of the mixture and quality of binder slurry. Coconut pith will decompose in the soil very slowly as its pentosan-lignin ratio (0:30) is below 0.5 which is the minimum required for the slow decomposition of organic matter in the soils. Pith is an excellent surface mulch in all kinds of soils. It absorbs slightly more than 8 times its weight of water (82.3%) and release it comparatively slowly. It has been found that by incorporation of 2 per cent by weight of pith with sandy soil, the water holding capacity of the soil could be increased by 40 per cent. Pith as a Heat Insulating Material Pith has a low density and thermal conductivity and in combination with cement has been found to be an excellent thermal insulating material. Since pith and latex are abundantly available, light thermal insulating materials can also be developed by using pith with rubber latex. The possibility of pith-clay light weight bricks for use as insulating bricks can also be investigated.


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STAGES OF THE PROCESS PROPOSED FOR THE INTEGRATED MODEL

MATRIX OF INPUTS AND COORDINATION REQUIRED AT STAGE

Campaign for awareness and collection at HH level

Collection training, deployment of work force and coordination Bin distribution

Training for management of collection and aggregation system to central coordination

Training for running defibring unit

Lease agreement with Hi-Tech park holding agencies for operation-functioning arrangement

Source technology, agency for pith, coconut shell work Appoint designer, link with market and produce against orders even in training period

Selection and appointing the marketing management agency

Additional cost of campaign

Collectors deployed on the field

Manage aggregation- Through Society, later SPV Manage Defibring operation +pith collection

Part supported by GP project- use land of hi-tech park Held by SPV, commercial format PPP model

To be paid and supported by Growth Pole initially, for three years, then from profits of the group of companies (SPV)—performance based fees

Households Kudumbasree Kudumbasree area development society equivalent of this

Plantations Prvt Collector tie up with daily vendors –vegetable, fish, garbage collection

Commercial –hotels/restaurants

Prvt collection system

Central aggregation point (only management, not physical storage)-1 for 15 wards- can be a merchant

Defibring unit management who supply to spinners

- Defibring operations - Pith conditioning - Shell preparation - EDP & Ongoing Training centre

- Coir composite board factory - Shell based product –common production center

Business intel unit/consultancy (annual contract) Marketing and export related support Intel inputs- ongoing.

Yarn manufacture: Mangadam Anjengore+ others Geo-textiles

Products-Mats and Mattings

Mkt-Domestic International

Defibring- machine

Retting

Pollachi Fibre

Husk supplyCollection

Scavenging

Husk and shell production at household/

plantation, post coconut use

Manufacture, finishing, value additionShell supplyPaid collection Shell based products

Burning, waste

Markets-Domestic International

Markets-Domestic International

ConditioningClean Pith Brickets/Packets

Fibre supply


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4.7.2. Project Components

• Improved collection of locally available husk: Setting up groups and systems with adequate supply of materials (collection bins), and transport facilities. [Details of incomes from collection and the process components are included at Annex 4C-3, in a spread sheet]

• Upgradation of old units and and installation of new defibring unit and

linking it to existing cooperatives to demonstrate efficiencies along the value chain.

The following table shows an illustration of the cost heads and how this may be made profitable: Defibring Unit New Unit Old Unit Land Development/Land Costs 6 0Building (including soaking tank) 5.5 2.5Plant and Machinery 15 10Power 2.5 1.25Preliminary and pre-operative costs 1 0.75Working capital (one year) 5 3 TOTAL (Cost in Rs Lakhs) 35 17.5

Cost of Production and Profitability-Defibring Unit Estimated annual production 168 tonns Price (Rs 9.75/kg) 9750 per MT Sales value (in Rs) 16.38 Expenses

Coconut Husks (24 laks@60 p each) 9.6 Rs lakhs Salaries and wages 1.5 Rs lakhs

Power 1.2 Rs lakhs Miscellaneous 1 Rs lakhs

Preliminary and pre-operative 1.5 Rs lakhs Total expenses 14.8 Rs lakhs

Projected Profit 1.58 Rs lakhs Plant and Machinery (per defibring unit) 1 Husk Crusher 1 2 Defibring mill 1 3 Screening Machine 1 4 Turbo-cleaner 1 5 Bailing Machine 1 6 Material Handeling system 1 Total Costs (in rs Lakhs) 15


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• Expanding to shell based products: Re-skilling coir workers to work with coconut shell product manufacture as a strategy to diversify risk, get an additional source of income, and reduce dependence on one industry

o In addition to linking the existing R&D on shell-based products, training will be provided to interested groups. This is intended to focus on coir workers but others may also join, after forming groups

o Forward links to markets willing to procure the shell-based products through buyer-seller meets, participation in fairs and direct interactions

4.7.3. Financial aspects, funding with source, and management

COIR Intervention Rs lacs No of Units Rs lacs

PPCP Coir Diversification Programme

A Husk collection Pilot Project through Kudumbashree 12 women employable at a time Collections vehicles 4.50 4.50 5 22.50 Collection Bins 1.40 1.40 5 7.00 Working Capital 6 months 2.70 2.70 5 13.50 Training component - EDP 3.60 3.60 5 18.00 Confederation costs 1.00 1.00 5 5.00 Awareness Campaign 6.00 6.00 5 30.00 sub-total 19.20 96.00

B Defibring Units and Pith-Organic Manure Unit

Upgradation-Defibring Unit 35.00 17.50 2 35.00 New Unit-Defibring Unit 105.00 35.00 3 105.00 Pith conditioning unit 75.00 15.00 5 75.00 Training at defibreing / EDP 5.00 1.00 5 5.00 sub-total 220.00 220.00

C

Resource deepening - coconut shells

Briquetting Unit 20 20.00 Training and Capacity Building 7.20 7.20 EDP Training 1.20 1.20 sub-total 28.40 28.40

D

High-end Product Placement (international Markets)

Identification of product sets, design input requirement, skill availability (Initial assessment- 3-month exercise)

50.00

50.00 Selection, training and development

with 10 profit-making and skilled Co-operative units (on an ongoing basis)

220.00

22.00 10 220.00 Design inputs into products,

placement, branding and forward

160.00 160.00


KBIP, GoK 102

linkages (all units)

Quality assurance - training of one selected cooperative society. (ongoing and scalable)

50.00

50.00 1 50.00 Organising of selected societies into

an export oriented agency, over a three-year period

60.00

6.00 10 60.00 Sub-total 540.00 540.00

E Market Links

Market Assessment, linking,positioning- pith and coconut shell 40.00 40.00

Pitch chemical assessment forproductization 15.00 15.00

Resource (Marketing, Design,Technology) 14.40 14.40

Mechanization as a competitive edge 3.00 3.00

Special cell for exploring and linkingwith high-end product placement ofcoir based products (internationalmarket) 120.00 120.00

sub-total 192.40 192.40

COIR SECTOR TOTAL 1,076.80


• Kudumbashree o Identification of group for collection system

• Coir Board / Coir Fed o Identification of partner units for de-fibreing units

• ICAR (CIPRI) Technical assessment of coir, pith

• BDS Providers Market Assessment New Skill Training EDP Training

4.8.1. Sources of Funding and schemes

Ministry of SSI, Credit linked Capital Subsidy Scheme and scheme for CFCs The following table indicated the proposed sources of funding by component and areas where schemes may be dovetailed.


KBIP, GoK 103

Intervention Rs lacs % eligible under various heads Amount in Rs lacs Source(s_ PPCP Coir Diversification

Programme GOI GOK Users Pvt

sector /banks

NCEUS GOI GOK Users Pvt sec /banks

NCEUS

A Husk collection Pilot Project through Kudumbashree

12 women employable at a time

Collections vehicles 22.50 95% 5% 21.38 - 1.13 - - Cr Linked Cap. Subsidy Scheme

Collection Bins 7.00 95% 5% 6.65 - 0.35 - - Cr Linked Cap. Subsidy Scheme

Working Capital 6 months 13.50 95% 5% 12.83 - 0.68 - - Training component - EDP 18.00 95% 5% 17.10 - 0.90 - - Cr Linked Cap.

Subsidy Scheme Confederation costs 5.00 95% 5% 4.75 - 0.25 - - Cr Linked Cap.

Subsidy Scheme Awareness Campaign 30.00 100% 0% 30.00 - - - - sub-total 96.00 92.70 - 3.30 - - B Defibring Units and Pith-

Organic Manure Unit

Upgradation-Defibring Unit 35.00 60% 20% 20% 21.00 - 7.00 7.00 - DC SSI, CFC scheme with strategic investor

New Unit-Defibring Unit 105.00 60% 20% 20% 63.00 - 21.00 21.00 - DC SSI, CFC scheme with strategic investor

Pith conditioning unit 75.00 75% 5% 20% 56.25 - 3.75 15.00 - Training at defibreing unit /

EDP 5.00 80% 20% 4.00 - 1.00 - -

sub-total 220.00 144.25 - 32.75 43.00 -


KBIP, GoK 104

C Resource deepening - coconut shells

Briquetting Unit 20 0% 50% 10% 40% - 10.00 2.00 8.00 - Coir Dept scheme, GoK

Training and Capacity Building

7.20 80% 20% 5.76 - 1.44 - -

EDP Training 1.20 80% 20% 0.96 - 0.24 - - sub-total 28.40 6.72 10.00 3.68 8.00 - D High-end Product

Placement (international Markets)

Identification of product sets, design input requirement, skill availability (Initial assessment- 3-month exercise)

50.00 0% 0% 0% 0% 100% - - - - 50.00

Selection, training and development with 10 profit-making and skilled Co-operative units (on an ongoing basis)

220.00 5% 0% 0% 0% 95% 11.00 - - - 209.00

Design inputs into products, placement, branding and forward linkages (all units)

160.00 0% 0% 0% 0% 100% - - - - 160.00

Quality assurance - training of one selected cooperative society. (ongoing and scalable)

50.00 0% 0% 10% 0% 90% - - 5.00 - 45.00

Organising of selected societies into an export oriented agency, over a three-year period

60.00 0% 0% 5% 5% 90% - - 3.00 3.00 54.00

Sub-total 540.00 2% 0% 1% 1% 96% 11.00 - 8.00 3.00 518.00


KBIP, GoK 105

E Market Links Market Assessment, linking,

positioning- pith and coconut shell

40.00 25% 0% 0% 0% 75% 10.00 - - - 30.00

Pitch chemical assessment for productization

15.00 30% 0% 0% 0% 70% 4.50 - - - 10.50

Resource (Marketing, Design, Technology)

14.40 100% 0% 0% 0% 0% 14.40 - - - -

Mechanization as a competitive edge

3.00 100% 0% 0% 0% 0% 3.00 - - - -

Special cell for exploring and linking with high-end product placement of coir based products (international market)

120.00 90% 0% 10% 0% 0% 108.00 - 12.00 - -

sub-total 192.40 139.90 - 12.00 - 40.50 TOTAL

1,076.80 37% 1% 6% 5% 52% 394.57 10.00 59.73 54.00 558.50


KBIP, GoK 106

4. D. TOURISM SECTOR

The Tourism sector needs to be viewed in the context of the region’s setting. Tourism in India is marketed at a national theme, for the country, and as state specific destinations. Kollam’s tourism traffic is dependent on the overall tourism setting for Kerala state. The tourism sector is being assessed accordingly.

4.1. TOURISM IN KERALA

The tourism sector in Kerala has been growing in importance both in terms of generation of local employment as well as contribution to India’s international tourism. Kerala accounts for about 10% of India international tourists but only about 2% of domestic tourists as is shown in the following table.

KERALA’S CONTRIBUTION TO INDIAN TOURISM

(in millions) Domestic Tourists 2004 2005 2006

India 367.70 390.47 414.64* Kerala 5.97 5.95 6.27

Foreign Tourists India 3.457 3.719 4.430

Kerala 0.346 0.346 0.429 Kerala's share

Domestic 0.94% 0.95% 1.07% International 9.99% 9.32% 9.67%

*projection based on previous years’ growth The above statistics are remarkable in that Kerala has increased its domestic tourist traffic by more than 350% since 1994, when it was 1.28 million to nearly 6 million currently. International tourists in 1994 comprised less than 5% of Indian tourists. International tourists also spend close to 14.1 days in Kerala on an average compared to 1.5 days in 1994. This compares favourably with India’s average of 7-18 days. International tourists spend US $ 1492 during their stay in India. This compares favourably with the global average of US $ 849 and an average stay of 16 days.1 A domestic tourist in comparison spends Rs 601 per trip. A large proportion of domestic tourist expenditure in aggregate is on “same-day” trips where they

1 Ministry of Tourism & Culture, WTTC studies


KBIP, GoK 107

spend an average of Rs 86. However, as can be seen from the above table, the volumes of domestic tourists are considerably larger and can impact in situ employment and incomes. Targeting international tourists for long duration stays and domestic tourists for increased spends represent two ways of benefiting the local economy. About 2/3rd of the international tourists visit Kerala in the period from October to March, while domestic tourists’ visits are spread evenly through the year. International tourists primarily visit for leisure purposes while a large proportion of domestic tourists visit Kerala for religious and social purposes. Kerala’s success has been recognized within India and a best practices report authored in 2005 listed the following as the key elements’ of the state’s success: These (‘The Change Imperatives’)2 are summarised below:

• Build tourism on core and naturally available resources • Create an distinct brand image for tourism • Compete internationally not locally • Learn from mistakes made elsewhere to avoid traps of development • Professional administration and strong political support to ensure stability

of the tourism development programme • Social development and citizen responsiveness to tourists are essential

components of tourism development • Let the professionals lead • Give the private sector the space it requires to grow • Package the product to align with international trends • Protect the product to ensure sustainable development • Continue to work on the disadvantages and weakness • • Take tourism seriously – ‘making tourism everybody’s business’

From the above lessons, it is clear that Kerala has successfully focused on five critically important and interrelated areas for strategic intervention, emphasizing on the first three to begin with and then spreading the focus to the other two areas: • Policy: supporting a transparent and inclusive policy process, promoting fair and open competition, strengthening institutional capacity to implement and enforce policies, drawing international support to augment expertise • Product Development: leveraging core strengths, creating new products, building USP, focusing on sustainable development to offer products of international quality, creating enabling investment environment, stimulating

2 Source: Kerala’s Approach to Tourism Development: A Case Study Ministry of Tourism & Culture, Government of India


KBIP, GoK 108

demand, promoting partnerships to ensure the flow of funds into the tourism sector • Marketing: building a brand, emphasizing quality assurances, providing demand-driven information, competing at a global level, collaborating on international and regional platforms to create a highly visible platform for the state. • Infrastructure: focusing on the core and linkage infrastructure and investing in strategically focused capacity to support development priorities • Tourism Services: building a critical mass of tourism workers, increasing technical skills, strengthening community entrepreneurial skills, augmenting managerial capacity to build a service sector sensitive to tourists and tourism3 The state has assessed tourism as a significant contributor to the economy especially in terms of employment generation. The following table reflects growth of the Travel and Tourism industry employment, from 0.38 million to over 1.13 million by 2013, with the overall economy benefiting by way of a cumulative 1.43 million additional jobs.

Source: WTC Report

CASE STUDY: ECONOMIC IMPACT OF A SINGLE PROJECT The ‘Coconut Lagoon’ was one of the earliest projects to be implemented in Kumarakom in the Kottayam district, undertaken by one of the oldest promoter groups in Kerala, the local Casino Group. At the time of implementation, the surrounding community was largely rural, dependant on their farms and on fishing for livelihood. The community was poor and many local farmers were on the verge of selling their farms and moving out. The project was implemented at a cost of around Rs.3.50 crore, almost entirely utilizing local resources, including materials and labour from the local community, which implied that the major component of the project cost flowed into the village as income, creating trade and employment opportunities for the people. 3 Source: Kerala’s Approach to Tourism Development: A Case Study Ministry of Tourism & Culture, Government of India


KBIP, GoK 109

After implementation, the 50-room Coconut Lagoon Resort directly employed around 90 people, all from the local community. The indirect benefit of the project extended much further, touching the lives of many in the local village. The Coconut Lagoon was essentially an ecotourism/rural tourism project based on active experience of nature and culture by the tourist. Community participation was an essential aspect of this experience. The tourists who stayed in the Coconut Lagoon resort were taken to visit the local spice farms. Tourists would pay the farmer around Rs.50 a day for a day’s experience and would also buy products from the farm. The farmer, who would receive at least around 20 tourists a day, would earn around Rs 1,000 which he would invest in his farm, thus upgrading productivity. The real impact of the project can be gauged by the fact that one of the farmers gradually improved his livelihood to such an extent that he built two small cottages and today rents them to tourists as guesthouses. His ‘home-stay’ resort is called ‘Philipkutty's Farm’. In addition to local farmers, the fishermen also benefited because their boats and services were used for cruises and boat-rides on the backwater lagoons. Employment was created for local guides and taxi operators too. Today, 10 years since the implementation of the Coconut Lagoon project, Kumarakom is one of the hottest destinations, with two heritage hotels and three-star hotels, a combined room capacity of more than 200, in addition to four ‘home-stays’, the bed and breakfast homes of the local farmers.. The whole of Kumarakom is involved either directly or indirectly in the tourism activity of the region. The economic impact is reflected in the real estate value escalation. This has shown a 50-times escalation in value over a 12-year period. In 1992, the cost of 10 acres of land was Rs. 10 Lakh that increased to Rs.50 Lakh per acre in 2004.

4.2. KOLLAM - STATUS IN KERALA TOURISM

Kollam is one of the least developed districts in terms of Kerala’s tourism. Kollam contributes less than 2% of Kerala’s tourists, whether domestic or international, as shown in the following table.

KOLLAM IN KERALA TOURISM

Foreign tourists 2004 2005 2006

Kerala 345,546 346,499 428,534 Kollam - 6,813 7,918

Domestic tourists Kerala 5,972,182 5,946,423 6,271,724 Kollam - 98,227 122,998

Kollam's share% Domestic - 1.65% 1.96%

International - 1.97% 1.85% A district wise comparison reflects Kollam’s poor share of the tourism market.


KBIP, GoK 110

Kollam’s share of the tourism market would seem to be abysmal since it is part of the two main waterways/water bodies systems in Kerala viz. Ashtamudi, and Pathiramanal. Kerala itself represents one of four unique backwaters waterways systems in the world, the others being the Danube Delta, the Bay Area (USA) and Venice. A long term Perspective Plan for Tourism Development was made in 2003 by the Kerala state government, with a planning horizon extending to 2022. The document listed the following tourist attractions that can be developed in Kollam district. (see summary table).

0

20,000

40,000

60,000

80,000

100,000

120,000

No

of T

ouris

ts

DISTRICT WISE COMPARISON OF FOREIGN TOURIST ARRIVAL IN KERALA

F o re ig n 3 8 ,0 2 4 10 9 ,3 4 4 4 6 ,0 3 1 1,7 9 9 8 ,2 4 2 2 ,5 16 4 ,7 0 2 2 3 ,5 17 3 ,12 9 9 4 7 3 3 0 2 ,6 5 8 10 3 ,5 5 8 7 4 9

A LA P P UZHA

ER N A KULA M

ID UKKI KA S A R AGOD

KOLLA M KA N N UR KOZHIKOD E

KOTTA YA M

M A LA PP UR A M

P A LA KKA D

P A THAN A M THI

TTA

THR IS SUR

THIR UVA N A N THA P UR

WA YA NA D

Kollam


KBIP, GoK 111

Tourism destinations in Kollam are given in the following map. As can be seen these include a variety of tourism themes including:

• Beaches • Backwaters • Eco-tourism • Wildlife


KBIP, GoK 112

• Health • Heritage • Religious tourism

TOURISM ATTRACTIONS IN KOLLAM

4.2.1. Tourism Infrastructure in Kollam

Tourism infrastructure, especially hotel rooms, in the Kollam Growth Pole Area are concentrated in Kollam town. The following map illustrates their concentration in the district.

HOTELS, MOTELS AND RESORTS IN KOLLAM

Kollam has 25 luxury hotels with a total capacity of 687 rooms. Most of these hotels are in Kollam town.

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Naday

ara K

ayal

LAKSHADWEEP SEA

Asht

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ayal

Para

voor K

ayal

Achenkovil Aarr

F r o m A d o o rF r o m A d o o rF r o m A d o o rF r o m A d o o r

T o T r i v a n d r u mT o T r i v a n d r u m T o T r i v a n d r u mT o T r i v a n d r u m

T o T r i v a n d r u mT o T r i v a n d r u m

T o S h e n k o t t a iT o S h e n k o t t a i

F r o m A l a p p u z h aF r o m A l a p p u z h a

F r o m P a t h a n a m t h i t t aF r o m P a t h a n a m t h i t t a

Kollam District

KULATHUPUZHA

ARYANKAVUTHENMALA

PIRAVANTHUR

YEROOR

CHITHARA

ITTIVA

KADAKKAL

MYLOM

PUNALUR

VELIYAM

ELAMADU

ANCHALUMMANNUR

THALAVOOR

ALAYAMON

EDAMULAKKAL

MELILA

KOLLAM CORPORATION

CHATHANNUR

VETTIKKAVALA

KULAKKADA

KAREEPRA

NILAMEL

THAZHAVA

KALLUVATHUKKAL

NEDUMPANA

KARAVALOOR

PANMANA

THODIYUR

PERAYAM

PATTAZHY

VILAKKUDY

VELINALLOOR

KUNNATHUR

PARAVUR

NEDUVATHUR

PORUVAZHY

MAYYANAD

POOYAPPALLY

SASTHAMCOTTA

PATHANAPURAM

PERINADU

EZHUKONE

OACHIRA

ADICHANALLUR

MYNAGAPALLYPAVITHRESWARAM

THRIKKARUVA

SOORANAD NORTH

ELAMPALLOOR

THEVALAKKARA

KOTTARAKKARAPANAYAM

CHADAYAMANGALAM

KARUNAGAPALLY

CLAPPANA

POOTHAKKULAM

SOORANAD SOUTH

KUNDARA

ALAPPAD

VELINALLOOR

T.B. Jn

R.O. Jn

mylom Jn KSRTC jn

ayoor Jn

yeroor Jn

market Jn

pallimukku

nilamel jn

titanium Jn

pidavoor Jn

kottiyam Jn

vavvakavu Jn

kulakkada Jn

madathara jn

chinnakada jnthattamala Jn

chathanoor Jn

parippally Jn

pooyappally Jn

bharanikkavu Jn

pathanapuram Jn

kulathupuzha jn

karunagapally Jn

puthur mandapam Jn


KBIP, GoK 113

4.3. ANALYSIS

Kollam has all the advantages as a tourism destination that Kerala has become famous for.– backwaters, health, beaches, heritage. However, its performance has been poor both in terms of development of tourism destinations as well as actual throughput of tourists. Additionally, very few linkages exist with local culture, handicrafts and cuisine – as a concerted and thematic effort in the project area, to boost tourism. The state’s medium term goal for tourism in Kollam has not resulted in significant footfalls thus far compared to other locations in Kerala. The reasons for this have been examined and the current plan considers these. The plan has been developed to reverse this trend in the five-year period.

4.3.1. SWOT of Tourism

Strengths

• Kollam is well connected by road, rail and is easily accessible from Trivandrum which is an international airport • It is a terminal point for backwaters

tourism at Ashtamudi Lake. • Kollam district offers all key tourism

themes within its geographical area – beach, wildlife, backwaters, village, religious, heritage, health

Weaknesses

• Kollam does not have a key anchor investor by way of a high-end resort. • Stay facilities are poorly developed

outside of the Kollam town area • Linkages with existing sectors such as

handicrafts, fisheries, cashew and coir is poor.

Opportunities • Kollam can position itself as a

competitive location within Kerala. Several themes of tourism based on local culture have been identified and need to be developed. Some of these being evaluated are listed below:

1. Beach front development- promenade 2. Model Village Tourism Project 3. Linkage with local handicrafts that

include: • Rentha (Lace Works) in Eravipuram

is the only classic handicrafts of Kollam. • The bamboo works at Manakkara

can be developed into a tourism attraction. • Screw pine • Straw picture card articles at

Kadavoor area 4. Linkage to local festivals and music 5. Backwater Tourism – Ashtamudi--

There is a good scope for developing backwater tourism in Kollam..

Threats

• Other districts of Kerala present similar themes and offerings. With anchor investors such as the Casino Group (Kottayam), Taj (Kovalam near Trivandrum) these destinations are developing fast and are better known. • Tourism is being recognized nationally

as an important driver to economic development. Kollam will have to compete with destinations such as Goa and Rajasthan, that have well developed tourism infrastructure and branding as destinations. • The condition of Ashtmudi lake as a

backwater is deteriorating to pollution from sewerage dumping, usage of waters for various economic activities that are polluting (coir retting). • The lack of safety and emergency

services relating to beach tourism and backwaters tourism. A single incident involving tourists could drastically set back Kollam and Kerala’s prospects as a


KBIP, GoK 114

6. Festival Tourism --Malanada in Poruvazhi, Anayadi in Soornadu North, Kottakulangara in Karunagappally etc. are the famous temple festival centres where peculiar form of festivals are performed with the active participation of the village people as a while.

• Kerala is a fast growing tourist

destination with Trivandrum and Cochin being the main points of entry for high value international tourists. Kollam can, with properly developed tourism themes capture more income for the local economy from the existing through traffic.

tourism destination.

4.4. INTERVENTIONS PROPOSED: APPROACH

4.4.1. 5-yr perspective and approach

The project area of the Growth Pole and its vicinity represents a high potential tourism destination as per discussions with key stakeholders – tour operators’ and the department of tourism. The building blocks for the Tourism Development Plan are:

• An anchor project to attract high-profile private sector players in tourism • Strong community linkages through direct association with the local

economy, culture and cuisine • Promotion of the natural habitat –including human habitations as

tourism destinations within the growth pole circuit The presence of local craft and artisanal traditions are also proposed to be supported and encouraged for their promotion and as a complementary part of Tourism Development.

INTERVENTIONS: INITIAL PHASE

The overall approach envisages an early set of interventions to prepare the necessary ground (both in terms of human resources, local capacities and an attitudinal shift) for a set of community based tourism interventions that a of a much larger scale and would roll out in the later stage. Support and training for the local crafts clusters is being considered in the earlier part and comprises the approach and strategy. The initial interventions proposed in tourism revolves around three facets:


KBIP, GoK 115

• The poor usage of spoken English in the hospitality and tourism sector

despite high literacy and knowledge of the language. Thus, a pilot project to train people in usage of spoken English is being proposed. If found effective, this will be scaled up through purely private sector investments. Courses will be offered to 500 persons in the tourism related sectors who can be selected with the help of the PRI institutions.

• The lack of safety services despite the usage of backwaters for both

tourism and routine transportation4. Training in provision of safety and rescue services is being proposed for the backwaters and beach destinations. Courses will be offered in safety and rescue services to 100 persons in the first year, through expert institutions functioning in Goa and other maritime/water-front destinations.

• Guides will be provided training through a structured package of

information on local culture, heritage and activities so that they are able to embellish the experiences of the existing tourist traffic. These will be further tailored and diversified over the years and may be accessed as privately financed courses beyond the second year.

• Linkages with local handicrafts. Many local handicrafts groups such as lace

making, straw pictures cannot cater to large quantities of the kind that can gain a national market. However, local linkages through tourism can provide a steady and lucrative market. An initial beginning is being made with design interventions in the straw pictures sector.

4.5. OVERALL INTERVENTIONS PROPOSED: PLAN AND COMPONENTS

The human resources development is an adjuvant to the overall plan, as the needs for the kind of skills will emerge more clearly over time. Large-scale interventions are being proposed in a phased manner, over the five-year period and have been detailed here.

4.5.1. Program Structure

Interventions have been divided into two parts:

4 This facet was highlighted with the tragic deaths, in February 2007, of 15 school children and 3 teachers in the Periyar river near Thatekad due to the absence of basic safety procedures and equipment such as lifejackets


KBIP, GoK 116

PART I: INTEGRATED TOURISM DEVELOPMENT.

This includes a number of sub-projects and project-propositions that, as part of the Growth Pole exercise, may be developed and explored. It is possible that some of these projects will be formulated as a separate exercise with its own budget and funding arrangements. Whilst the initial and essential exercise will require the involvement of the government, to a small degree, in terms of finance and support, to set the tone for the development, subsequent projects, identified and formulate as part of this integrated planning, may be developed and implemented separately. This provision is reflected in the financial aspects and proposed budget for this component, discussed towards the end of this section.

PART II:LOCAL ECONOMY AND CRAFTS BASED INTERVENTIONS

This supporting set of initiates are thematically, part of the Integrated Tourism Development plan, and also have complementary objectives for their individual sectors/clusters. This part covers the development of sites and areas (precincts and whole villages), craft (lace-making, screw-pine, bamboo, temple handicrafts etc) and traditional artisanal work like black-smithy, dairying, fishing, etc. The tourism development plan for the area encompasses the key components shown in the table below. The locations and activities have been identified in consultation with panchayat representatives and residents of the areas. Components of the Plan Location PART I 1 Integrated Tourism Development Zone Kollam to Paravoor Hotels Catering and restaurants Tourism Complexes Theme Parks PART II Integration of local economy with Tourism 2 Model Fishing Village Allapad 3 Nature tourism (Aqua) Vellimon 4 Village Tourism Project Thekkumbagam 5 Crafts/Cultural based tourism Performing arts centre Sooranadu Temple Handicrafts Poruvazhy and Kottankulangara Blacksmiths Kottarakkara Screw Pine / lace Eravipuram Bamboo Mannakara Festivals Malanada in Poruvazhi


KBIP, GoK 117

Anayadi in Soornadu North Kottakulangara in Karunagappally 6 Activity Based Tourism Dairy Kundara & Mulavana Agriculture Muthuvilakadu, Neduvathoor, Puthur Coir Perumon Cashew food court Killikollure

4.5.2. The Integrated Tourism Development Zone

An area of about 1000 ha of land have been identified in the four blocks of Iravipuram, Mayyanad, Paravoor and Polachira as under:

These are abandoned paddy fields and water logged areas. The paddy cultivation is not possible due to the flow of brackish water into the paddy fields. People are not interested in shifting over to other agricultural activities such as coconut tress and vegetables. People in these localities have

already been taking up other means of livelihood activities and they are not prepared to do agricultural activities. The land can therefore be acquired/negotiated/leased for development of a tourism zone depending on its suitability, availability and viability. About 10 hectares in each block may be developed for tourism specific projects. The areas discussed are presented in the map below: A key proposal is that a Beach promenade be constructed along the stretch between Paravoor and Kollam (a 16 km stretch, of which an ecologically and technically viable stretch—some 8-12 km—may be identified). A detailed project report with techno-economic feasibility will require to be developed before this is take up, to maximise benefits that would accrue to the local population and the investors/promoters, users and minimize the negative impacts. It is proposed that this project be developed in coordination with the Growth Pole program. An allocation for funding the Project development exercise has been proposed as part of the Tourism Sector budget.

Block Area (in ha)1 Iravipuram 1292 Mayyanad 1053 Paravoor 5604 Polachira 296 Total 1090


KBIP, GoK 118

The construction of the promenade would cater to pedestrians, enable non-motorized traffic and form a tourist attraction. The tourist sites developed will be linked to the promenade. An illustration of a beach promenade in Rio is shown as one possible example, among several options for the low intensity development (envisaged as low-density to no-construction development, along the promenade, with more development on the mainland, with well-developed connections).

The consultations held on tourism clearly revealed the need for an anchor project to drive tourism traffic to the project area. Availability of land for development was cited to be a constraint. The development of the anchor project is expected to take a period of 3 to 4 years given the various processes to be completed prior to project definition and for implementation of the project as envisaged. The tourism zone to be developed in the near future will be over an area of 10 hectares (about 25 acres) at Eravipuram, and will tentatively comprise the components given in the table. Prior to commencing construction, a detailed project report will need to be prepared with more specific program requirements, economic and financial viability, environmental and social assessments. This exercise would be funded through the project development fun proposed for this purpose. Given its size, it is proposed that the first phase of this two-phase project will be covered under the Growth Pole Program.

No. Facility Capacity

1 Accommodation Restaurants

180-200 rooms 15-20 restaurants


KBIP, GoK 119

Common Facilities 2 Commerical Tourism Area:

Retail Spaces Tourist office spaces

85,000 square feet

3 Theme Parks 2 hectares 4 Common Facilities / Landscaped Areas 5 hectares

It is estimated that the cost of development of the complex including land acquisition costs will be about Rs 115 Crores and that will be entirely funded through private development. An additional development charge of about 10% of the project cost will be recovered from the successful bidder / awardee to contribute towards the Beach promenade and development of retail spaces in the growth pole area for local handicrafts and food producers. This investment will also be split over two phases, with the first phase being taken up during the first 5 years. Successful tourist traffic development will create the demand for additional facilities and energize investments in the area with the community. It is envisaged that the anchor investment in the tourism Zone will provide the valuable impetus to Kollam Growth Pole Area to become a flagship destination in Kerala’s tourism circuit, in line with the high expectations that Tourism experts have off the area’s potential. The Tourism Zone will, within the overall context of the Tourism Development Plan, contribute an estimated 2,000 job by way of direct employment.

ESTIMATE FOR DEVELOPMENT OF THE TOURISM ZONE

Development Estimate in Rs lacs

1 Integrated Tourism and Commercial Complex 2719 2 Theme Parks 250 3 Common Areas 817 4 Land Costs 1853 Total Project Cost* 5629

* development fee will be recovered from investor on this cost

EXPECTED TIME FRAME FOR DEVELOPMENT

It is expected that the project development phases will be along the following time lines, including the processes involved:

No Activity Expected time

1 Approval of concept after formal discussion with community

3-6 months

2 Preparation of DPR 3 month 3 EIA and obtaining all statutory approvals

and infrastructure clearances 6-9 months

4 Bid process management 3 –6 months 5 Development of facilities 12 –15months Total estimated time frame 27-39 months


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During this time period Part II: “Integration of local economy with tourism” initiatives, described in the following section will result in improved ability of the local community to provide marketable products and services in terms of food, handicrafts and arts, performances, productizied packages of activities that will provide the breadth and depth of the tourist experience. It is proposed that the Integrated Tourism Development Zone project be structured in any one of the following ways in a PPP:

• The community contributes the land through a special purpose vehicle of land holders and become co-owners of the facility with the private sector partner

• The land owners pool the land together under a special purpose vehicle and lease it out to the private sector partner either directly or through the state government

• The state government acquires the land at market prices from land owners and becomes a partner with the private sector partner.

• The state government acquires the land and leases it to the private sector partner

• The normal process of acquiring the land and re-selling it to the private sector developer for a small development charge

Barring the last option, all the others present opportunities for strong community based partnerships in development of the complex with equity partnership strengthening the community stake in ensuring the success of the project.

4.5.3. Integration of local economy with tourism

MODEL FISHING VILLAGE PROJECT ALLAPADU

The Alappad Panchayath is sandwitched between the backwaters and the sea. About 70% of the people are engaged in fishing activities. Even educated people are willing to do fishing as a part time job. Fishing is part of their cultural heritage. A 36 acre land under fisheries Dept. has been demarcated for fish culture in Ayiramthengu. Luxuriant growth of mangroves is the peculiarity of this locality. Unlike many other fishing areas, Alappad is very calm and pleasant. All these factors support Alappad Panchayath in Karunagappally as the best place for developing a Model Fishing Village Tourism Project. Amrithapuri is located in this panchayath.(see picture of ashram). Thousands of foreign and domestic tourists visit Amrithapuri every year to visit Ma Amrithanandmayi, a reknowned spiritual leader.


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The Fishing Village will comprise of the following components. Developing the village infrastructure for fishing with a freezing plant for storage. Creation of an amenities complex for tourists with accompanying fish food restaurant based on local catch and ethnic food. The village could earn through visitor fees and sales of fish food and sea food products (pickles etc). About a 100 women will be trained to develop and manage the facilities created at this village location- tourism complex, food facilities and sales of retail fish food products. Another 50 women will be trained to produce pickles from fish and such related products for sales to tourists. Visitors will also be able to board and tour with fishing boats. A rescue services facility will also be created at this centre to ensure safety of tourists and to be an important facility for the fisherfolk. The cost of the projeced intervention is estimated at Rs 1.20 crores and will be funded through the community funds, fish exporters, fisheries department and the Ma Amrithanandmayi Trust.

NATURE (AQUA) TOURISM AT VELLIMON

Vellimon is a beautiful island in Ashtamudi.The water quality of this area is good for tourism activities. A Marine-cum-Water Sports Tourism Complex will be developed in Vellimon. The facility will also have a houseboat marina for tourists to stay on houseboats while they experience the complex. The back water is ideal for swimming, scuba diving and snorkling. The development will include:

• A Marine Aquarium (local brackish water species)

• Aquaculture training centre • Water based sports • A house boat marine • Safety services

Particulars Amount in Rs lacs

1 Freezing plant, cold storage 502 Tourism ameneties complex 503 Training 104 Rescue services 10 Total 120


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Tourists already visit this island so the destination will be relatively easy to promote on the tour. Locals will be trained to participate and operate the tourism facility which will be co-owned and managed by a private operator. The estimated costs are Rs 147.50 lacs as indicated in the table.

VILLAGE TOURISM AT THEKKUMBAGAM

The Ministry of Tourism, Government of India in its National Tourism Policy 2002 announced that Village Tourism would be promoted as the Primary Tourism Product of India to spread tourism and its socio-economic benefits to rural areas. Chavara Thekkembagam is the ideal location for developing a Model Village Tourism Project in Kollam growth pole area. About a quarter of its 20 sq km area is land area with the rest being water bodies. The area includes 9 small islands and is home to about 16,000 people engaged primarily in traditional occupations. Salient Features The total area : 20.26 Sq. Km Land Area : 5.22 Sq. Km Total Wards : 12 Boundaries : South-West : Chavara North-West :Thevalakkara Islands (Thuruth) : 1.Polimoolilkadavu Thekethuruthu 2.Kochuthuruth 3.Kanalthuruth 4.Poothuruth 5.Velithuruth 6.Cheekenthuruth 7.Kallukadathuruthu 8.Bhavanithuruth 9.Dhalavapuram 10.Thekkumbahagam Total No. of Wells : 1297 Total number of Ponds : 13 Population : 16928 (8159 Male; 8769 Female) Density of Population : 781 Land based : 3300 Main Occupants : Agriculture, Coir, Fishing

Nature Tourism: Vellimon Rs lacs

Aqua culture training centre 10.00Brakish water aquarium 50.00Information Centre 25.00House Boat Marina 25.00Water Based tourism activity base 25.00Marine equipment for safety 10.00Training for running facility 2.50Sub total 147.50


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Agricultural Labourers : 4500 Fishing : 1000 Families (4000 approximately) Coir : 2000 Total No. of Kudumbasree Units : 118

Thekkumbahgam Grama Panchayath has been selected for the best Grama Panchayath Award in the District. The Panchayath is surrounded by backwater. This island has been secluded from the main land till 2005. A bridge has been constructed in Dhalavapuram and the work of the bridge and approach road is progressing. Even though its part of the land is secluded from the main stream, the livelihood activities and educational status of the people are very high. The people are hardworking and accommodative. The women are known to be enterprising. Thekkumbhagam has already been placed in the tourism map of Kerala through the Ashtamudi Resort. The Club Mahindra has taken over the Ashtamudi Resort. 80 Cottages are under construction. Coir, copra making

A tourist can see the natural way of coir making, copra making, dry fish processing unit, Calm culture, Oyster Culture, shrimp farms, traditional fishing activities, agricultural lands cattle rearing, small poultry farms (Household), cultural heritage such as traditional art forms, heritage buildings (Azhakkath family), St. Joseph Church (1857), Kakathikurussu (Relies of Portuguese) and Panackattodil Devi Temple. The cruise along the backwater around Thekkumbhagam is a potentially thrilling experience for the tourist. The whole village has a serene atmosphere. The climate is moderate. The Endogenous Tourism Project of Govt. of India – UNDP can be implemented in Thekkumbhagam.

Endogenous tourism Project – UNDP Endogenous tourism means travel, both domestic and international, not for pleasure alone but also for broadening the visitors experience platform – where the source of attraction lies ‘within’


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the host community or environment. It encompasses cultural tourism, craft tourism and also eco tourism all sustainable forms that value and celebrate the diversity and resources of the state. The basic objectives of Endogenous Tourism Project are : (1) Build capacity at the local level. (2) Support innovative and promising rural tourism initiatives (3) Build Strong community – Private Partnerships in the tourism sector through an enabling environment for the dynamic participation of local communities/artisans/state authorities, NGO and private entrepreneurs in setting up and sustaining efforts in this area. The expected result of Endogenous Tourism Project : (1) Creation of employment opportunities via rural art and craft skill and nature. (2) Creation of value addition for local expertise and raw materials. (3) Creation of capacity building for income generation. (4) Gender equality, empowerment of youth and disadvantaged sections. (5) Preservation of cultural, natural and built heritage. (6) Environmentally sustainable tourism products. (7) Marketing outlets to optimize domestic and international reach. The whole project is divided into two – Software Activities and Hardware Activities . Software Activities cover the following types of activities: Capacity building/Direct training • Awareness programme • Gender sensitization Hardware Activities are : • Improvement of the surroundings of the Village – Landscaping, development of Park

etc. • Improvement to roads within the panchayath level. • Illumination in the Village. • Improvement in Waste Management • Construction of Way side amenities • Signages • Reception Centre Etc. The project cost estimated at Rs 70 lacs is proposed to be funded as under: Training and soft components Activities : 20 lacs (by UNDP) Village upgradation and tourist facilitation : 50 lac (Govt. of India)

CRAFTS AND CULTURE BASED TOURISM

Cultural Tourism has the image of adding a local flavour to the tourist experience. It is easily associated with quality tourism. It allows for wide product differentiation. It offers a solution for the problem of seasonality. It also encourages more active holidays, more environmentally sensitive activities. The twelve elements of culture are Handicrafts, language, traditions, gastronomy, art and music, history of the region, livelihood activities of residents architecture, religion, educational system, dress, leisure activities. Kollam was a great centre of learning and culture. Leelathilakam and Unnuneeli Sandesam, two outstanding literary works of historical importance of 14th Century, were written in Kollam. The dance form of Kathakali in its new version of Ramanattam was the creation of Kottarakkara Thampuran.


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Many areas of Kollam Growth Pole area have the potential of promoting cultural tourism. Anayadi in Sooranadu North Panchayath, Poruvazhy, Kottakulangara etc. are the potential centres. But most of the cultural activities are related to temple heritage and activities. Sooranadu North Panchayath can be developed as a cultural tourism centre. The tourism development plan for the area will stitch these locations into a sub-circuit that can be visited. These are described below:

CULTURAL TOURISM PROJECT IN SOORANADU NORTH

Sooranadu means ‘land of brave people’. It had a rich tradition of Kalari System. Anayadi in Sooranadu was the military training centre of Venad dynasty. Sooranadu is the native place of famous scholar Sooranadu Kunjan Pillai. Most of the cultural activities are associated with the temple festivals. The festival in Narasinhamoorthy temple at Anayadi is very famous. About 100 elephants participate in the temple festival during February. Even the festivals in Trissur do not embellish with more elephants than Anayadi. The temple is said to be 1700 years old. More than one lakh people participate in the temple festival during February. About 1000 foreign tourists also participate in the festival particularly to view the colourful pageant of elephants and musical rhythms. Almost all the temple arts are performed during the festival.

TRADITIONAL FESTIVALS

Nine days of musical concerts at the Navarathri Mandapam in Anayadi during October attracts thousands of music-lovers every year. This programme has become a tourist attraction since the tourist season begins on October. There are centres for teaching music and dance in Anayadi. Narayana School of Music and dance teaches the old art forms which are on the verge of extinction. Gurukul System of learning of music is practicing in many of the centres. Kakkarissi Drama, Chenda (drum), Velakali, Sasthampattu, Vilpattu, Jnattupattu (Paddy Harvesting Songs), Padayani, Kalamezhuthu Pattu, Velanthullal, Sarpent Pattu etc. are the old form of performing arts which are on the verge of extinction.


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The Soornadu Panchayath is very keen to revive those art forms for posterity. Many houses teach classical dance and music to young students. Hence this village can be developed as a musical village, the first of this kind as far as tourism is concerned.

LIVELIHOOD ACTIVITIES

Most people are engaged in agricultural activities. About 4,250 people are farmers. Cultivation of paddy, vegetables and coconuts are major activities. Cattle-rearing is the other major activity here. More than 50% houses rear cows. Approximately 5,000 Litres of milk is producing in this village. In short, the Panchayath has a rich cultural legacy, livelihood activities, and the beautiful village surroundings. Pooruvazhy Panchayath, the nearby Panchayath of Sooranadu is also termed as the cultural tourism centre because of its unique temple Malanada. It has the only temple of Duryodhana, (an evil character in the epic, the Mahabharatha). The Kettukazhcha, the Chariot procession of Malanada is very attractive. Thousands of pilgrims participate in the festival. A lot of foreign tourists are also participating the festival during March. Duryodhana temple It is proposed to develop Soornadu as a Traditional Performing Arts Center with accompanying infrastructure to be developed around a traditional Kalagramam. The project cost is estimated to be Rs 165 lacs of which a third will be funded by contributions from the Anayadi Temple trust and the public at large. There will be a special initiative for waste management given the large numbers who congregate for the festivals.


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PROPOSED KALAGRAMAM

Cultural Tourism: Sooranadu North Rs lacs

Kalagramam (training centre for arts) 100 Information centre cum amenities 25 Awareness and training 10 Signage 10 Total 145

TEMPLE HANDICRAFTS- PORUVAZHY AND KOTTANKULANGARA

A new area of handicrafts products should be developed based on the temple festivals. The ritual images of festivals such as chariot (Kettukazcha), bullocks, horses (Eduppukuthira) etc are the themes of handicrafts. The present huge and beautiful images may be converted into miniature forms.

Temple Handicrafts: Bullock (Left Top) And Chariots


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There are many artists in Poruvazhy and Kottankulangara areas, who can make miniatures of these images. The devotees as well as the tourists would purchase these articles with potential to upscale over time. This will certainly have a boom in the handicraft sector in Kollam. Presently there are more than 500 artisans who make the huge temple images. They are willing to produce proto type articles too. If proper training will be given, a lot of artists would come forward to its take up the jobs.

BLACKSMITHS- KOTTARAKKARA

The traditional black smithy has its own elegance and value in society. Once upon a time the blacksmiths were an integral part of any society. But this art form is slowly fading away. The traditional blacksmiths who are engaged in making agricultural equipments and household articles should be encouraged to keep up their tradition. A cluster type of blacksmith can be developed in Kottarakkara. There are about 25 families are engaged in this handicrafts. They have a traditional shed, Alas (Shed) in front of their houses. All the family members participate in the work. The product basket could be made contemporary and attractive to tourists besides providing them an opportunity to work with traditional instruments. The potential tourists can visit their traditional thatched sheds. This cluster will be an arena for giving training for the younger generation.

SCREW-PINE

Screw-pine products at Thazhava is one of the rare hand made articles. Screwpine (Botanical name: Pandanous) plants are mostly seen only in Kerala. The best variety of leaves is taken from the plants grown in places like Karunagapally, Thazhava of Kollam District. There are male and female screw-pines. The best variety is female screw-pines. Approximately 1000 craftsmen are engaged in this work. The production processes are very attractive. Stage – I : Selection of leaves. The leaves have thorn on the edges of the

leaf as well as on its vertebral side. The thorns are removed by using a thread tied between two fingers.

Stage – II : The leaf is then split into the required width with the help of a small knife.


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Stage – III : The leaves are then boiled in a copper vessel for about 30 minutes and later allowed to cool for 5 minutes. The leaves are then removed to another container which contains cold water for a period of 12 hours. The hot and cold water treatment is meant for removing the chlorophyle content of the leaves.

Stage – IV : The leaves are spread to dry in the direct sun for a period of 4-5 hours to obtain a bleaching effect on the leaves.

Stage – V : The leaves are straightened with the help of knife. Stage – VI : Indigenous dye is used for colouring the splits. Stage – VII : The split are now ready for weaving. Stage – VIII : Embroidery works. Screw pine products The production of screw-pine articles in different stages is also a tourist attraction. In order to save the craft from the present predicament, value added products should be manufactured. The conventional method of making bags pencil boxes, flower boxes, hat, tray, purses, beg mat, has lost its attraction. Modern embroidery works may be incorporated with screwpine products and small handy souvenirs should be produced for the potential tourists. Household production centres will be promoted for benefit to the tourists as well as the hosts. Since screw pine articles are eco-friendly products, this can be an added attraction for marketing. A wide varieties of products such as gift packets, cover for food articles, interior decorative articles etc. can be produced. Ambadi Cottage industries at Thazhava is a well organized centre which produces a lot of variety products and accommodates 40 employees. They have a plan to expand their products with a view to attract the potential tourists. Screw pine articles are, at present, not up to the standard. Quality improvements and value addition should be done through proper training. The production process of screw pines articles at its various stages will also be an attraction to the tourists. Screw pine village at Thazhava will be recognized and promoted by the Department of industries and tourism as it is one of the existing locations where ecofriendly handicrafts are producing.

LACE

Rentha Embroidery work (or lace-making) is one of the contributions of the Portuguese. Lace making was a hobby practiced by housewives of the elite Portuguese. The skills were transmitted from Portuguese to the local


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community. Bridal costumes, church decorations have been the areas of Rentha craft. 70% of the produce was being exported to other countries during 40s, 50s and 60s. Presently, only a few women around Eravipuram area are making lace products. Eravipuram Vanitha Cottage Industrial Service Co-operative Society, the only organised sector unit, is promoting the Rentha. The society has 161 members and 35 workers. Besides more than 75 women are engaged in this work on piece meal basis. In order to propagate the culture 25 students are selected for training by the District Panchayath. An amount of Rs. 500/- per month is given to each student for a period of four months. Rentha-making, a fine art form, needs to be preserved. In order to save the art, the society need to establish contracts with garment makers, Church authorities and other export oriented handloom textile groups. Most of the workers are old women, so a new generation needs to take up the legacy. When the Beach Road project becomes a reality, visitors should be induced to visit the houses or societies which make Rentha. The interaction with the visitors will be the best method of promoting awareness of this art form.

BAMBOO - MANNAKARA

Most of the bamboo workers are concentrated in Manakkara and Pallisserikkal in Sasthamcotta Grama Panchayath. About 25 families comprising 150 workers are actively engaged in this. Altogether 500 workers in the Growth Pole area as per the report of the Manakkara bamboo workers. They produce articles from Reeds and bamboo. They collect the raw materials from the Bamboo corporation. Only household and agricultural oriented articles are produced here. So quality is not given importance at this stage. Small handicrafts products are needed for the potential tourists. The bamboo workers are willing to produce new products if given proper training.

Bamboo workers Value addition through innovation and design interventions is needed for the upgradation of the products.


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These bamboo workers are also performing artists in traditional. All members of the family participate in the performances. Adisastham Cotta Kala Samithy, a society formed by the artists, is the main organisation which trains the younger generation, passing on knowledge of traditional songs, Theyyam and musical. These art forms are based on the traditional knowledge handed down by generations and form an exclusive heritage. In addition to these, they make their own exclusive traditional food. Potential tourists can visit this cluster group of bamboo workers and participate in the livelihood activities and the performing art forms. They can also taste the traditional food of the community.

INTERVENTIONS IN CRAFTS CLUSTERS

The interventions across the traditional crafts clusters revolve around the following components:

• Training and skill development to produce new products that are customer friendly

• Design inputs • Linkages with tourism circuit to sell retail products • Limited promotional activities

These costs components have been assessed across the different craft clusters as under (detailed financials included at Annex 4D-2) Lace/Screw Pine Promotional Training Sub total Bamboo Handicrafts design inputs Training centre Marketing Training of performing artists Sub total Blacksmiths Working capital Training Design tourism product Cafeteria/kitchen Sub total Temple handicrafts

ACTIVITY BASED TOURISM

It is proposed to extend the concept of village and cultural tourism to traditional occupations in the village areas.


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Coir Perumon Traditional method of coir making is practising in certain pockets in Kollam. Perumon is a beautiful village located in Ashtamudi Lake. A cluster of 25 families make coir in a traditional manner. Average income is Rs. 80 to 100 per day per worker and in the Kerala context meagre. Workers are not willing to stick on to their livelihood activities. In order to preserve the traditional livelihood activities, the incomes have to be increased from the craft. The traditional way of making coir products, traditional way of life of workers, the calm living conditions of the workers, the beautiful village atmosphere, the presence of vast structures of backwater drinking water facility (well water), ethnic food, cow sheds sheep other domestic animals, birds etc of the Perumom region are ideal components for a coir village. The potential tourists can actively involve in the livelihood activities of the villagers. Home-stay accommodation can be arranged for the tourists. A project cost of Rs 30 lacs has been estimated primarily to productize the tourist experience with improved product design, signages and upgrade the village infrastructure. Dairy- Kundara & Mulavana Dairy is developed in Kundara Mulavana localities. About 10,000 litres of milk is produced every day. About 30% people are engaged in diary activities and almost all the houses in Mulavana keep cows. One Mr.Biju is keeping 21 cows in his house. Even though dairy is well organised is Kundara localities, milk products are not made in the area for which there is scope. The tourists will get the opportunities to visit house hold cattle sheds and interact with the farmers. They can also taste the home-made food of milk farmers. Agriculture Muthuvilakadu, Neduvathoor, Puthur Muthuvilakkadu in Sasthamcotta, Neduvathoor, Puthur in Chittumala blocks are the ideal locations for promoting Agritourism centres. Organic farming will be encouraged. Additional income generated by tourism will sustain the agricultural activities. Farmers will be ready to stick on their agricultural activities. Model Agriculrural farms, poultry farms, paddy fields, coconut farms, diary farms etc should be developed. Cashew food court Killikollure Cashew based exclusive food court, the first of this kind in the world, can be developed in Killikolore and beach road. A variety of food with cashew as an ingredient will be served in the food court. Value addition should be done in the process. Cashew dried with honey, masala, cardamom etc can be developed. Also cashew candy, Cashew sweets etc can be prepared. Small cashew packs with 2 to 3 Kernels can be popularised.


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A total budget of Rs 29 lacs is envisaged for the dairying, agriculture and cashew based interventions, primarily on training people to handle productized packages for tourists.

4.6. FINANCIAL ESTIMATES

The overall budget for the Tourism Zone Project is outlined in the following table:

No: Project

Estimated Costs Rs lacs GoI GoK

Users/CP

Pvt sector/bank NCEUS

Part I Integrated Tourism Development Zone

1 Project Development Fund 319 160 160 2 Integrated Tourism Complex 5,629 5,629

3

Project development: WaterfrontPromenade 200 100 100

Part I Total 6,148 - 260 - 5,629 260

% of column tototal 0% 5% 0% 90% 5%

Part I+II GRAND TOTAL 6,230 - 301 - 5,629 301

% of column tototal 0% 4% 0% 92% 4%

Part II Integration of economy with Tourism

1 Model FishingVillage Allapad 120 50 25 20 25

2 Nature Tourism Vellimon 148 25 123 3 Village Tourism Thekkumbaggam 70 70 4 Crafts Cultural based tourism

Performing ArtsCentre Sooranadu 145 30 35 50 20 10

Temple Handicrafts Poruvazhy, Kottankulangara 32 16 16

Blacksmiths Kottarakkara 63 50 13 Screw Pine / Lace Eravipuram 35 35 Bamboo Mannakara 30 17 13 Festivals Malanada etc 60 30 30 sub-total 365 30 117 96 70 52

5 Activity based Tourism

Dairy Kundara Mulavana 4 4

Agriculture Sasthamcotta, Neduvathoor etc 20 10 10

Coir Perumon 30 15 15

Cashew FoodCourt Killikikolore 5 5

sub-total 59 - 25 - 5 29


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No: Project

Estimated Costs Rs lacs GoI GoK

Users/CP

Pvt sector/bank NCEUS

Total 761 120 212 118 218 94

% of column to total 13% 29% 16% 29% 14% The interventions proposed in the capacity building initiatives have been estimated as under: No Interventions Cost in Rs lakh

1 English Language Training 15.00 2. Safety and Rescue Services 10.00 3. Training for local guides 1.00 3 Straw Pictures design interventions 3.00 TOTAL 29.00

4.6.1. Sources of Funds

The Capacity Building Interventions 1. to 3. above can be covered under the Ministry of Tourism’s scheme under its Human Resources development initiative. Expert institutions from the private sector can provide English language training and Safety and Rescue Services while training of guides could be undertaken through Kerala Tourism. The sources of funds for each of the above initiatives planned have been based on availability of funds from existing budgets and schemes of the state government, central schemes of the Ministry of Tourism and the gaps being plugged by resources of the NCEUS under the growth pole projects. User contributions, loans and contributions from Trusts and association have been based on discussions held with the respective communities and community based organizations.

4.7. IMPACTS

The impacts of the initial capacity building interventions are expected to be qualitative in terms of an embellished tourism experience and demonstrate the gains of linkages with local culture and handicrafts. The longer term impacts of the Tourism Development Programme envisaged under the Growth Pole Project will have four distinct phases with different objectives: Phase 1 : Over the first 12-18 months will focus on capacity building and development of tourist friend products and productized experiences. The


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tourism objective will be to gradually attract “pass through” tourists to spend some additional time and money in the project area. Phase 2 : 18-36 months period will focus on complete integration of the whole range of local crafts, produce, culture and activity based tourism with the tourism circuit and travel and tour operators. The tourism objective will be to keep tourists overnight during a two day stint in the project area: Phase 3 : Post 36 months will focus on attempting to increase the length of stay of the tourists in the project area to a targeted length of about 5/6 days over a span of two or three years. At this point the Integrated Tourism Development Zone will provide the international quality hotel facilities as an anchor investment. Phase 4: With the visible success of the benefits of integration with the local economy and the anchor investment, it is envisaged that by year 7, there will be a proliferation of further investments in Integrated Tourism Zones that the local communities will contribute idle land and Kollam Growth Pole Area assumes its rightly place as a Tourism destination in Kerala. The focus throughout these phases will be induce tourist spending on local handicrafts, products, cuisine and cultural experiences along with takeaway mementos and memorabilia from the area. The summary impacts table is given below:

As will be noted from the table, the acceleration in tourist traffic is from year 4 onwards. The direct employment assumed is for increased hotel accommodation.

4.8. ROLL OUT

The interventions will be rolled out across five years. The phased roll out of the Tourism Development Plan for the project area is given diagrammatically in the following table:

Summary Year >>>> 1 2 3 4 5 6 7 8

Tourism Traffic 144,008 158,408 174,249 243,949 341,528 478,140 597,675 687,326

Increased Spending anticipated Rs lacs 2,068 3,786 5,320 10,258 22,216 42,742 55,114 65,051

Potential Revenue to state/centre Rs lacs 207 379 532 1,026 2,222 4,274 5,511 6,505

Additional Private Investment Rs lacs - 824 824 5,123 13,970 30,363 39,926 47,098

Employment potential (direct incremental) - 567 - 2,955 6,082 11,270 6,574 4,931


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N o : P r o j e c t L o c a t i o n A c t i v i t i e s u n d e r P r o j e c t Q u a r t e r 1 2 3 4 5 6 7 8 9 1 0 1 1 1 2 1 3 1 4 1 5 1 6

1 T o u r is m Z o n e K o l l a m t o P a r a v o o r A p p r o v a l a n d c r e a t io n o f P D FH o t e ls P r e p a r a t io n o f D P RC a t e r i n g a n d r e s t a u r a n t s E n v i r o n m e n t a l / C R Z a p p r o v a lsT o u r is m C o m p l e x e s L a n d a c q u is i t io nT h e m e P a r k s B i d P r o c e s s M a n a g e m e n t

C o n s t r u c t i o n o f F a c i l i t i e sL a u n c h

2 M o d e l F i s h i n g V i l l a g e A l la p a d T r a i n i n gG u i d e s

P i c k l e m a k i n gR e t a i l f o o d

R e s c u e s e r v i c e sC o l d s t o r a g e / e q u i p m e n t

D e s i g n o f P r o d u c t i z e d

3 N a t u r e t o u r is m ( A q u a ) V e l l i m o n T r a i n i n gH a n d l i n g a q u a c u l t u r e

G u i d e sP r o d u c t i z e d d e s i g n

P r o je c t D e v e l o p m e n tB id o u tC o n s t r u c t io n

4 V i l l a g e T o u r i s m P r o j e c t T h e k k u m b a g a m A w a r e n e s s P r o g r a m m eD e v e l o p m e n t o f F a c i l i t i e s

5C r a f t s / C u l t u r a l b a s e dt o u r i s m

A w a r e n e s s P r o g r a m m e

P e r f o r m in g a r t s c e n t r e S o o r a n a d u L a n d c o n t r ib u t i o nT e m p le H a n d ic r a f t s P o r u v a z h y a n d K o t t a n k u l a n g a r a T r a i n i n g o f a r t i s a n s

B l a c k s m i t h s K o t t a r a k k a r a D e s i g n i n p u t sS c r e w P in e / l a c e E r a v i p u r a m E D P T r a in in g

B a m b o o M a n n a k a r a C o n s t r u c t io n o f P e r f o r m i n g

A r t s C e n t r eF e s t i v a l s M a la n a d a i n P o r u v a z h i

A n a y a d i in S o o r n a d u N o r t hK o t t a k u l a n g a r a i n K a r u n a g a p p a l l y

6 A c t i v i t y B a s e d T o u r i s m A w a r e n e s s P r o g r a m m eD a i r y K u n d a r a & M u l a v a n a L a n d c o n t r ib u t i o nA g r i c u l t u r e M u t h u v i l a k a d u , N e d u v a t h o o r ,

P u t h u rT r a i n i n g

C o i r P e r u m o n D e v e l o p m e n t o f F a c i l i t i e sC a s h e w f o o d c o u r t K i l l i k o l lu r e


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5. PURA LINKAGES AND CROSS-CUTTING ISSUES

The Growth Pole project, in addition to incorporating the concept of a geographic concentration of clusters, is also underscored by other supporting intervention that cut across all sectors/clusters in the Growth Pole Area in a manner that further complements their synergies. NCEUS’s note on the Growth Pole Concept also includes the PURA Concept of making urban amenities and linkages available in rural areas.

5.1. CROSS-CUTTING INFRASTRUCTURE THEMES

Towards these ends, this project, within the Growth Pole Programme starts the process of establishing and supporting cross-cutting themes and linkages.

• Through development of common infrastructure like roads, bridges, cleaning maintaining and dredging of harbour

• Through the development of town level infrastructure in Kollam city, like sewerage and drainage, waste treatment and disposal, currently causing pollution in the water-bodies, as discussed in earlier sections of this document.

Further to physical infrastructure and management issues discussed here, two other cross-cutting themes have been introduced in the Growth Pole Area, that have been taken as sub-parts to this section. These are

• A module on management of the lake systems in the Growth Pole Area, the benefits from which will be felt across the resident community, and keys sectors like fishing, tourism and the lake ecology. (Section 5A)

• Introduction and support of a service-delivery based local enterprise model. (Section 5B)

5.2. PROPOSED/PLANNED INFRASTRUCTURE DEVELOPMENT

Several works of reconstruction and repair at a large scale have been recently completed in the Kollam Growth Pole area, as a result of rehabilitation works under the state’s Tsunami Rehabilitation Program (TRP). Several others are being implemented or will soon be undertaken under the ADB component – Tsunami Emergency Assistance Programme (TEAP). These, in addition to restoring the old infrastructure have been planned taking into account present and future requirements and have been designed to be technically more sound (bridges).


KBIP, GoK 138

Consequently, these will be most beneficial to the community at large and fishermen and those associated with the sector, in particular. Most of these are planned to be completed within the next few years. The components of consequence to the Kollam Growth Pole, are summarized below:

5.2.1. Road Bridges and Harbour Links

Govt of Kerala Contribution towards GP project through ADB sanctioned grant to state govt for infrastructure rehabilitation/development under the Tsunami Emergency

Assistance Programme (TEAP)- Ongoing Other development works (cross cutting) Costs in

Rs lacs ADB to GoK

A Construction of Roads and Bridges 1 Construction of bridge across TS Canal connecting Ayiramthengu

and Azheekal (ownership PWD)-reteroactive work- ongoing 1118.2 1118.2

2 Construction of Kallummoottil Kadavu bridge (ownership PWD)-new work

1582 1582

3 Improvements to coastal road from Pozhikkara to Kappil (13/850 to 18/300). (ownership PWD)-new work

263 263

4 Improvements to Lalaji Junction- TS Canal (Panickerkadavu) Rd. (ownership PWD)-new work

35 35

5 Improvements to Oachira-Ayiramthengu (ownership PWD)-new work

35 35

Roads and Bridges SUBTOTAL 3033.2 3033.2

B Ports/Harbour development, Fishery development

1 Neendakara Port and Fishery Harbour: Repair of Roads and Protection Works

151.36 151.36

2 Neendakara Port and Fishery Harbour: Dredging 282.48 282.483 Thangaserry Fishery Harbour: Rectification of Breakwater, repair

of road and protection work 403.48 403.48

Ports/Harbour and Fishery SUBTOTAL 837.32 837.32

5.2.2. Town Level Infrastructure Development

The most urgent areas requiring attention and considerable investment, solid waste management, sewerage and drainage, account for almost 60% of the total proposed budget for infrastructure. The benefits from these interventions will accrue to people in several stakeholder categories. Among these the key groups are:

• Residents of Kollam Town • Shore-side dwellers along the sea and at landing centers in particular where

dumping was previously happening


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• People involved with marine fisheries in the shallow waters, along the coast-line in and near Kollam town

• Lake-shore side-dwellers (Ashtamudi Lake) • People involved with inland-fisheries sector (Ashtamudi Lake)

Projected Govt of Kerala Contribution* towards GP project through proposed ADB Loan to state government for infrastructure development under the : Kerala Sustainable Urban Development Project (PPTA 4106 – IND);- Kollam Town Component Project Costs in

Rs lacs GoK /ADB

Sanitation, STPs and Drainage 6620 6620Solid waste management 742 742

(Urban Infrastructure for Kollam Town) SUB-TOTAL 7326

5.3. OVERALL FINANCIALS FOR INFRASTRUCTURE

To summarize, the overall infrastructure requirements that comprise the cross-cutting connectivity theme, in the Kollam Growth Pole area are shown in the table below. Infrastructure Proposed/approved under other funded projects/programs) In Rs Lakh % of sub-total

Roads and Bridges 3033 27.00%Ports/harbour and Fishery Development 837 7.45%Sanitation, STPs and Drainage 6620 58.93%Solid waste management 742 6.61%INFRASTRUCTURE TOTAL 11232 100.00%

* : Kerala Sustainable Urban Development Project (PPTA 4106 – IND); May 2005- Govt of Kerala, Local Self Govt Dept


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5. A. LAKE MANAGEMENT

5.1. OVERVIEW

The preceding sections covering the key sectors, especially fisheries, coir and tourism, have made reference to the significance of the Ashtamudi Lake system in the Growth Pole Area. In addition to the Ashtamudi Lake, Shastamkota Lake has also been referred to in the context of overall regional development and the dependence of the population on these water bodies, in several ways. As indicated in the map, both these lake systems are within the Kollam Growth Pole area and comprise key environmental features of the region, with several cross-cutting implications for the community.

Source: as stated on map

5.1.1. Ashtamudi Lake

The area covered by the Ashtamudi Lake is estimated to be 6,424 Ha. Of serious concern is that this lake-spread is decreasing even as the overall capacity of the lake is decreasing. The decrease is due to the twin issues of encroachments along the lake-shores due to heavy pressures of a dense population and deposition of silt. There are 13 Block Panchayats (22 Gram Panchayats) in Ashtamudi area with an estimated 19,065 households living around the area. Of these, 14,669 currently involved in Marine Fishing, the rest in inland fishing and other activities. Even the families that primarily depend on marine fisheries, fish in the lake area.

Shasthamcotta Lake

Ashtamudi Lake


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A small degree of aquaculture has also been experimented with along the northern part (185 Ha) of the lake

ASHTAMUDI LAKE : ISSUES

Among the primary concerns pertaining to this lake, water quality is a serious issue, and on par with the issue of decreasing lake area and capacity. Water quality issues here, are caused by pollution and the following reasons have contributed to this issue, and continue to add to the problem:

• Discharge of untreated effluents from hospitals and hotels • Discharge of domestic effluents, untreated liquid waste • Discharge from slaughterhouse; Municipal Solid Waste dumping yard. • Discharge from seafood export units and peeling sheds. • Coconut husk retting and coir retting. • Discharge from shrimp farms. • Discharge of acid mine water from the clay mines into Kanjirottu Kayal. • Spreading of oil from passenger/fishing boats

• Decreasing mangroves along the sides, which help in the ecological balance in a lake ecology system

• Heavy siltation and alteration of the water balance during the monsoons, (resulting in decreased lake capacity too).

5.1.2. Shastamkotta Lake

The biggest fresh water lake of Kerala, covering 373 Ha., this is the source of supply of fresh water to Kollam Corporation area. Strategies to augment this resource are being considered, as with increasing pressures, this source will be unable to keep pace with requirements.

The lake, with great potential for tourism development is affected by water quality problems caused by pollution. Some inland fishery related activities are currently practiced but this is not as intense as in Ashtamudi Lake. Encouragement of fisheries in this lake system is also not recommended as it is the source of fresh drinking water and support for fisheries will be bundled with several pollution related problems, that this system could ill-afford.

SHASTAMKOTTA LAKE: ISSUES

Though this lake is less polluted than Ashamudi, it also has several issues, in addition to ones related to water quality.

• Discharges from the towns (Bharanikkavu and Sasthamcottah),


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• Open defecation on the banks of the lake, discharges from poor quality latrines,

• Large-scale retting of palm leaves in the lake • Use of fertilizers for plantation crops (run off from the surrounding

areas/fields/plantations to the lake) • Though situation not alarming, but needs attention • Another issue is water level depletion of the lake: Sand mining in the

nearby areas and Kallada river; over-drawal of water from the lake for Kollam town

5.2. LAKE MANAGEMENT: APPROACH AND STRATEGY

Given the several layers of problems afflicting the lake systems and their impact on the community, as also across existing and potential sectors (fisheries and tourism respectively), there is an urgent need to develop a suitable action-oriented set of strategies. Towards this end, the Growth Pole Programme with its focus on sector and area development, together with support for PURA connectivities (discussed earlier), provides an opportunity to bring this issue to the attention of the concerned authorities (several, given its cross-cutting nature). The problems discussed in the context of the lakes are not new findings and have been studied and noted from several points of view. In the recent past, Asia Development Assistance Facility, New Zealand, with the encouragement and support of the Minister for Tourism and Fisheries, Government of Kerala, had appointed technical consultants (including Centre for earth Science Studies, Trivandrum) had prepared a document on a management plan for Ashtamudi Eastury (2001). This included a study of the lake: status and issues, and had outlined broad recommendations for a line of further action. Based on the ground covered by this document and several consultations with the state agencies concerned, as well as noted experts on the issue, the following approach towards initiating lake management is suggested.

5.2.1. Components of strategy

1. Identification and plotting/mapping of Lake Area (present, as compared to the earlier lake boundaries) and a “command area” based on the watershed. This exercise should be housed in an appropriate government agency that may take the effort forward and be responsible for subsequent and regular monitoring exercises. This would involve the following:

a. Mapping of boundary, existing and previous, on a GIS platform b. Identification of present ownership and status of tenure

(encroachment etc, when they happened, what kind, etc)


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c. Land use along the lake shore 2. Soil and water conservation measures to be put into motion, based on

a ground truthing and available data. (details included in Annex 5A-1). The idea of the exercise is to reduce the silt load on the lake. This load is influenced by several factors in the command area that also need to be monitored, like cropping pattern based on topography, digging silt pits, (based on soil, moisture) etc. These could easily be mobilised through a community initiative driven by awareness campaigns and supported and monitored by Grama Panchayat bodies (PRIs).

3. Monitoring of Channels feeding the lake, for water quality, pollutants (nature) and source. These will then need to be incorporated into the management strategy.

4. Measure, assess and report pollutant load in lake on a regular format with the participation of the community and concerned stakeholders. This also helps to establish a credible cause-effect scenario that the community awareness drives may plug into their efforts, and also involve the PRIs.

5. Identify and assess Household level pollution- inflow of untreated domestic waste: sewerage, kitchen/washing wastewater, etc. The awareness campaign would include the introduction of appropriate technologies for preventing this and support the monitoring bodies to help assess and deal with the issue. This is likely to be addressed at the level of Kollam town through a waste management project (ADB Loan, discussed earlier).

5.2.2. Operationalising the strategy

A two-part process of interventions is proposed.

PART I

Setting up a community model at the ward level, with initial community consultation and participation. This would be followed by community-involvement (voluntary) in water-quality monitoring and reporting. The funding of appropriate sanitation-technology upgradation at household level may be considered through the Total Sanitation Campaign programme of the GoI.

PART II

Most importantly, a communication strategy and sustained awareness drive is required to be set in motion parallel to the technical solutions, to target attitudinal change. This, when successful, will be key in addressing the strategy components mentioned above.


KBIP, GoK 144

5.2.3. Regulatory aspects and fund streams

Further to the strategy suggested, to target the issue of over-fishing, the following regulatory measures are put up for further discussion.

• Licensing and registration of all nets that may be used in the lakes. This is in addition to the license required for crafts. The scheme of providing a fisher-folk credit card could be packaged with the registration and licensing process. Electronic tagging devices may be considered (technology for this is available and being used in the dairy and animal husbandry sector already, in the country)

• A system of community monitoring (through PRIs) on fishing practises may be instituted. The consensus agency may be later empowered (yr 3) to collect a cess based on catch size (or additional parameters). The revenue earnings from this could feed into re-stocking of appropriate fish in the Ashtamudi Lake and the net-licensing operation.

• Later in the program period, the identified agency may be additionally empowered to bid out fishing rights and to collect fines on regulatory violations. In parallel, patrolling – on a 24 hour basis may be bid-out and the financed through the fines collected and partly through the earnings from fishing-rights.

• The earnings may be also utilised, with additional grant-funding for the cleaning of the lake by arresting pollutants and also relying on the natural lake cycle supplemented by rejuvenation of mangrove plantation along the shore.

Multi-lateral funding agencies like UNDP or ADB may be asked to look at Lake Management funding

5.2.4. Implementation process

Community involvement and support will be the most crucial ingredient to this strategy, especially the ones dwelling along the lake perimeter. PRIs, from the relevant Grama Panchayats taking up the implementation of this programme after due consultation with the community and building consensus on tough issues, would be the most effective way forward. The other significant stakeholder group is fisherfolk who fish in the lake systems. This category overlaps with the lakeside-dwellers but have a different set of interests in the lake resource. Reconciling their interests with the requirement of ecological rejuvenation and conservation of the lake will be the other key challenge.

INVOLVEMENT OF AGENCIES:

• Fisheries department


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• Revenue department • Inland waterways authority • Tourism department • Kudumbashree Are some key agencies that may be involved.

5.3. FINANCIAL ASPECTS

COMPONENT –WISE COSTS

No Component Costs (Rs Lacs)

Basis Purpose

1 Command Area Identification & Mapping 506000 ha

Map lake boundary - Ashtmudi

2 Soil and Water Conservation measures 75

6000 ha HH level Rs 15 k per home

3 Community Mgt structure3 years team of 5 @ 25 lacs per year

Enforcement of agreed lake rules

4 Structured Awareness and sensitization 160

50k families lake shore dwellers, group 25, 2 to 3 meetings, 8 k meetings @ 2K

All round awareness of lake issue

5 Sewerage and sanitation, drainage 60

Communication materials, resource persons

6 Solid Waste Management 15015 k per family, 100 k hh Domestic waste/ sanitation mgt

Total 495 Covered population 400,000aprox

SUMMARY AND SOURCE OF FUNDING

Summary of Costs:Sectors

Rs Lacs % eligible under various heads

Total GOI GOK Users Pvt sector/banks NCEUS

- 10% 5% 0% 85%Lake Management Plan 495 Amount in Rs lacs

GOI GOK Users Pvt sector/banks NCEUS

- 50 25 - 421


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5. B PURA CONNECTIVITIES: SMALL ENTERPRISES DEVELOPMENT

5.1. SERVICES AND SMALL ENTERPRISES DEVELOPMENT

Another area of employment generation that is fast emerging, given Kerala’s (and Kollam’s) particular development context, is the provision of small household and office-level support services like plumbing, electrical and electronic works, general property maintenance, etc. Even as the old courses set up at ITIs have traditionally addressed this sector in a limited way, there is tremendous opportunity to look at provision of training to young enterprising educated youth in both rural and urban areas to supply to this growing market. These are services that are cross-cutting in their application and can be run on a small enterprise-based model with low capital investment. Key to their growth is linkages:

• Physical-road, • Communication-phone, and • Knowledge-skills.

A small pilot to start organizing this set of linkage based services had been proposed in the one-year project (report submitted earlier), that would be suitably tailored and rolled-out on a larger scale in the subsequent stages of the programme. Tentatively, this scaling up has been project to include a wider spread with the introduction of 3-5 newer courses at the end of two years, based on the response to the pilot. The further scaling up may be based on this, as also the selection of the new courses.

5.1.1. Small enterprise development

PHASE I: PILOT

To begin with, it is proposed to train 50-60 persons selected /nominated by all the covered Gram Panchayats, with greater representation from Kollam town, given the population densities and the consequent chances of a greater demand in the area.


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Post-training, these people would be encouraged to form groups based on geographic areas, so as to bring together a basket of services that are mobile and on-call. Tool-kits, here required may be supplied with a 50% beneficiary contribution, to begin with.

PHASE II: POST-PILOT-UPSCALING

It is expected that the services could diversify, depending on the market reception and demands. In the subsequent phase, another 650 persons would be covered under this programme, with additional skills to be added, based on the response from the pilot phase.

5.1.2. Small enterprise development project: Financials

Phase I: Pilot In Rs Lakh A Training for Self employment

Training 6.60 Toolkits 6.60

sub-total 13.20 B Upgradation of ITI

Physical Infrastructure 5.00 Training of Trainers- New skills 2.00 sub-total 7.00 TOTAL 20.20

Phase II: Post-pilot-Upscaling

In Rs Lakh A Training for Self employment

Training 13.2 Toolkits 13.2

sub-total 26.4 B Upgradation of ITI

Physical Infrastructure addition/upgradation 10.00 Training of Trainers- Added skills 5.00 sub-total 15.00 TOTAL 41.40

SUMMARY AND FUNDING SOURCES

Summary of Costs Rs Lacs % eligible under various heads

Total GOI GOK Users Pvt sector/banks NCEUS Small Enterprise 45% 0% 3% 0% 51% Development 61.6Amount in Rs lacs GOI GOK Users Pvt sector/banks NCEUS 28 - 2 - 32


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5.1.3. Institutional links and Synergies

Synergies with local and expert agencies are expected to enrich the project, in the course of its design and implementation. Some proposed synergies are flagged below:

• Kudumbashree • PRI institutions

For Beneficiary Identification • ITI in growth pole region for training courses • Engineering college- resource centre • Management Institute

Training in services identified EDP Training

SMALL ENTERPRISE DEVELOPMENT PROJECT: ROLL-OUT OF PILOT

Acitivity List Months >>

1 2 3 4 5 6 7 8 9 10 11 12

Small Enterprises Development a Beneficiary Selection with PRI 2 1 1 b Application to CG Scheme / closure 5 1 1 1 1 1 c Training of ITI instructors 3 1 1 1 d Upgradation of ITI facilities 2 1 1 e Roll out of Training 2 1 1


KBIP, GoK

Part III

• Implementation Arrangements

• Consolidated Financials

• Coverage and Impacts


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6. IMPLEMENTATION ARRANGEMENTS

6.1. OVERALL IMPLEMENTATION STRUCTURE

The implementation of the interventions to commence in the first year will be under the overall supervision of a “Growth Pole Consultative Committee”. The Committee will be chaired by the Principal Secretary (Industries) and comprise of the following members:

• Principal Secretary (Industries) - Chairperson • District Magistrate • CEO - KBIP • Representative - State Industries Dept, Fisheries, Tourism,

Water Resources • President - District Panchayat • Representatives of industry / sector associations of:

Cashew Coir Fisheries Handicraft Tourism

• Representative – Centre for Earth Sciences, Centre for Water Resources Development and Management

KBIP Project



Municipal Corp


Cooperatives

CFCs



Cashew Sector

Non-CFC


Fishery Sector

Coir Sector








Small Enterprise

Development


Mgmt Institute



etc



KBIP Project



Municipal Corp


Cooperatives

CFCs



Cashew Sector

Non-CFC


Fishery Sector

Coir Sector








Small Enterprise

Development


Mgmt Institute



etc




KBIP, GoK 150

Additional representatives and experts may be invited to join the consultations as required. Later for the duration of the 5-yr programme, this committee can evolve into the Growth Pole Agency. The following diagram presents the recommended structure and role of the Implementation Agency KBIP will be the nodal agency who will recommend a Project Implementation Agency for taking responsibility for the project roll-out to be approved by the Growth Pole Consultative Committee (GPCC). The Project Implementation Agency should have the following experience:

• Cluster Development • Infrastructure Development • Financial structuring • Structuring and implementation of Public Private Partnerships • Project Management

o Project development o Legal documentation and tendering o Monitoring, evaluation and reporting o Coordination with state and central government departments and

agencies to ensure smooth dovetailing of funding streams for various project components

• Ability to take stakes in SPVs created for ownership, management and operations of assets created as part of larger Growth Pole programme

The Agency will have the following staff on a full-time basis at Kollam for the project.

• A full time CEO with 10 to 15 years of experience of Project Management/Management

• Experts in the following sectors / disciplines preferably with marketing / business development skills in the respective sectors:

Fisheries Cashew Coir Tourism Services Finance Environment and social impact management Cluster Development

Where appropriate the expertise may be contracted into the project team.


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The team will be structured into two parts:

• 1 unit with sector experts will be responsible for implementation of all common facilities / assets that are envisaged for the project

• The other unit will handle on “soft” issues – confederation, training, skill development working with partner institutions.

6.2. PROJECT IMPLEMENTATION AGENCY

ROLE OF AGENCY:

• Overall responsibility of implementing the Growth Pole programme • Mobilising resources including funding from various state, central schemes

and financial institutions • Facilitating linkages to market as necessary • Capacity building of stakeholders as envisaged in the project through

partner institutions and experts • Mobilize user groups and beneficiaries and structure appropriate Public

Private Community Partnerships to enable creation of common facilities • Undertake all legal documentation and paperwork necessary to effect

PPPs, PPCPs, training and technology infusion arrangements. • Identification, dissemination and transfer of appropriate technology for

the Cashew, coir and fisheries sectors as envisaged • Catalyse private sector investment as envisaged in the programme • Structuring frameworks to implement identified projects through special

purpose vehicles A key facet to the timely roll-out of the project is the access to various complementary schemes of the central govt. The state government through its nodal institution can facilitate and expedite the approvals for such proposals, that will be prepared and presented by the implementation agency.

6.3. MONITORING AND EVALUATION

It is proposed that periodic monitoring and evaluation be undertaken to ensure effective performance and delivery of the envisaged goals of the programme. Quarterly monitoring and review meetings with the Growth Pole Consultative Committee will be undertaken to ensure timely roll out of the project. Annual evaluation of the project progress by a third party is recommended.


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6.4. IMPLEMENTATION PARTNERSHIPS AND SYNERGIES

Specific partnerships and synergies have been potentially identified in each of the key existing clusters / sectors. These partnerships have been identified, based on the synergies and potential for complementarities.

6.4.1. Cashew

• Cashew Manufacturers and Exporters Association • Cashew Export Promotion Council of India • District Industries Centre

o For identification of project partners for technology upgradation partners

• Engineering college / R &D institution o Drum Roasting equipment design and prototype

• Management Institution / Engineering Institution o Process re-engineering o Best Practices

• HACCP Implementation Agency / KBIP o Food standards

• EDP Training o EDI or similar expert institution

6.4.2. Fisheries

• MatysFed • Kudumbashree* • Port Trust

o MoU with Fisherman’s association / women’s groups • KBIP • MPEDA • Dept of Fisheries

o Development of Integrated Landing Centre Project

• KINFRA, MPEDA o Development of equipment Technology

• Municipal Corporation of Kollam • PRI

* Details of Kudumbasree’s activities in the Kollam Growth Pole area at Annex 6-1


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o Identification of beneficiary groups for inland fisheries • BDS providers

o Skill development o Sensitization

6.4.3. Coir

• Kudumbashree* o Identification of group for collection system

• Coir Board / Coir Fed o Identification of partner units for de-fibreing units

• ICAR (CIPRI) Technical assessment of coir, pith

• BDS Providers Market Assessment New Skill Training EDP Training

6.4.4. Tourism and Handicrafts

• Kerala Tourism Comprehensive resource for development of the Integrated

Tourism Zone programme and other tourism components • PRI institutions

Beneficiary selection • Expert training institutions to be identified

Training in safety and English language • Handicrafts design expert

Straw Pictures design intervention

6.4.5. Services/Small Enterprises Development

• Kudumbashree* • PRI institutions

Beneficiary Identification • ITI in growth pole region • Engineering college • Management Institute

Training in services identified EDP Training

• Tourism Dept / KTDC


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Hospitality related services

6.4.6. Lake Management

Centre for Earth Sciences Centre for Water Resources Development & Management Expert resources to be identified


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7. FINANCIAL ASPECTS

Sector-wise financial implications have been included in the respective sections (preceding this) whilst the financial aspects of cross-cutting interventions -including infrastructure- have been discussed in the context of the relevant sections, in the earlier parts of this document. The consolidated financials are presented and discussed here with brief notes on potential funding sources, comparative analyses and linkages with implementation, roll-out and impacts.

7.1. SUMMARY OF FINANCIALS FOR THE FIVE-YR PROGRAMME

Sector In Rs Lakh

% of sub-total


Cashew 2258 15.41% 14.85% Fisheries (Marine and Inland) 4406 30.08% 28.97% Coir 1077 7.35% 7.08% Tourism 6148 41.97% 40.43% Local Economy and Crafts Development 761 5.19% 5.00%I SUB-TOTAL (Sectors) 14650 100%

Cross-Cutting Interventions In Rs Lakh

% of sub-total

% of Program Total*

Lake Management 495 88.93% 3.26% Small Enterprises/Services 62 11.07% 0.41%II SUB-TOTAL (Cross-cutting) 557 100% Sub Totals I+II 15206 Project Management^^ 1255

III **PROGRAM TOTAL (Growth Pole Programme) 16462 59.44%

^^ @12.5% for the Overall Program and 2% for the Tourism component

Infrastructure (Proposed/approved under other funded projects/programs)

In Rs Lakh

% of sub-total

% of Grand Total

Roads and Bridges 3033 27.00% 10.95%

Ports/harbour and Fishery Development 837 7.45% 3.02%

Sanitation, STPs and Drainage 6620 58.93% 23.90%

Solid waste management 742 6.61% 2.68%

IV INFRASTRUCTURE TOTAL 11232 100.00% 40.56%

GRAND TOTAL (III+IV) 27694 Kollam Growth Pole: Consolidated Financials (in Rs Cr) 276.94

The consolidated costs of the interventions proposed for the Kollam Growth Pole are summarised in the above table. New initiatives proposed to be funded


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through the Growth Pole Program, supporting interventions that are already being processed under other projects/programmes, within the Kollam Growth Pole and other planned initiatives to be rolled out in the five-year period that have a direct bearing on the developmental aspects of the Growth Pole Area, have been integrated to represent the sum.

7.1.1. Other proposed and ongoing programmes in the Growth Pole Area

Distinctions regarding the sources of funding, under other multi-sector programmes are made in the table, using different colours to indicate the same. However, Government of India and Kerala Government funding sources through schemes and planned budget allocations are discussed in the following sub-sections, and are discussed according to sector/theme. Of the overall projected programme cost of Rs.277 Cr, 40% of the components, largely covering capital intensive infrastructure works in the area, are already proposed to be funded and implemented under the following: • Kerala Government’s Tsunami Relief Project (TRP), and its sub-component,

funded by the ADB, the Tsunami Emergency Assistance Project (TEAP). Several components of these, which would directly support the proposed Growth Pole Programme, are already in the pipeline with implementation starting soon.

• Kerala Sustainable Urban Development Project (ADB Loan Project, covering Kollam Town). Only the aspects pertaining to Kollam Town, in the Growth Pole Area, with direct links with several development issues and are cross-cutting themes, have been reflected in the overall summary table.

The focus of the program, directed at sector development of the key enterprise/industry clusters in the Kollam Growth Pole, some 60% of the total estimated costs, is discussed with inter-sector comparisons and funding sources, in the following sub-section.

7.1.2. Overall Funding of Key Existing Sectors

The figure alongside re-states the current sizes of the three largest enterprise/industry sectors in the Kollam Growth Pole, based on their latest yearly turnover figures. This is to present a reference to the quantum of proposed investment in these sectors and to anchor the aspects relating to amounts and sources of funding, for the suggested interventions. The analyses and projections presented in the individual sections pertaining to each sector already bear out the direction of the strategy and future prospects.


KBIP, GoK 157

Cashew processing, with the lion’s share of Rs 2007 Cr, a well-established sector, has long prospered in the area. Fisheries (largely marine, but also inland), the second most significant sector too has a sizable turnover of Rs 928Cr. The coir sector, recognised as a problem-sector recorded a poor performance that only adds up to Rs 58Cr. The total figures shown against each sector over

the whole range of proposed initiatives under the Growth Pole Programme and have been detailed in previous sections, particular to the sectors. Given this context, the proposed quantum of investment in the key sectors is illustrated in the figures below, as a proportion of the total annual turnover- this explains why in absolute terms, the share of investment proposed for coir appears as a relatively low one, at 7% (when seen against total project costs) whereas it stands at 18.6% of the sector’s total turnover and the highest proportion, compared with cashew and fisheries. The total interventions costs for the Cashew and Fisheries sectors are at 15% and 29% respectively, of the project cost. But when seen as a proportion of the total turnover of the sector, for the Cashew processing sector, it is 2% and for the fisheries sector, it is 2.4%

The Coir sector, with its weaker performance is being provided greater support but only to the extent that can be absorbed given the recent trends of coir workers moving to other sectors.

COIR

58

10.77

Turnover (RsCr) GP-New Invest


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7.2. FUNDING AND SOURCES: SECTORS:

The following table gives total costs and envisaged sources of funding for the key sectors. The funds under Government of India and Kerala Government are based on the schemes available and the outlined eligibility criteria. This is, of course, contingent to the qualification of the initiatives under the outlined criteria, at the time of availment.

Summary of Costs: Sectors Rs Lacs % eligible under various heads

Sector Total GOI GOK Users Pvt sector / banks

NCEUS

Cashew 2,258.00 5% 0% 33% 24% 38%Fisheries 4,406.00 30% 29% 29% 1% 10%Coir 1,076.80 37% 1% 6% 5% 52%Tourism 6,148.06 0% 4% 0% 92% 4%Local Economy and Crafts based interventions

761.00 13% 29% 16% 29% 14%

Lake Management Plan 495.00 0% 10% 5% 0% 85%Small Enterprise Development 61.60 45% 0% 3% 0% 51%TOTAL 15,206.46 13% 12% 15% 43% 18%

7.2.1. Cashew Sector

As extensively discussed in the section pertaining to the Cashew Processing industries, this has been a consistently good performer with a large base of skilled and semi-skilled labour. Initiatives are geared more towards process efficiencies and introduction of good, clean and safe working practises, techniques and, most of all a better work environment. This is being proposed through the support of ‘Model Units” as demonstration to the rest of the industry, which has the financial acumen to adopt take these further. Even within this sector, the 43% financial support of existing units has been envisaged in the SSI and tiny categories, not the medium size units (which have unit level turnovers in excess of Rs 5Cr annually). Given this sector’s financial health, a majority contribution is expected to be made by the participating units, Bank loans cold additionally support the contribution expected.

Government support 43%


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7.2.2. Fisheries Sector

The fisheries sector, though with a larger turnover from the Growth Pole area also has a very large employment base with certain sections not even making minimum wages, through the year. Even as sector level support is planned through infrastructure and common facility upgradation and over all work environment and hygiene improvement, lower user contributions are expected of the participant workforce/beneficiaries. Greater partnership and some private sector support is suggested (just under 30%) for some areas of sector upgradation but a larger effort towards training, awareness generation and skill diversification is also planned, that would be funded by various government sources. Overall, with a larger infrastructure (capital intensive) component, this sector has a higher share in the total project, which has also brought down the proportion of user contribution (when compared with the total, though it is comparable with other sectors, in absolute terms)

LAKE MANAGEMENT

This sector is also addressed, from the sustainability point of view, through the Lake management initiative proposed, and the tourism component, that would envisage increased worker participation from this sector, resulting in reduced dependence on the fishery sector alone. As the overall aim of the supporting initiatives includes ecological sustainability and overall environmental improvement as well (public goods) these are envisaged to be initially entirely funded through government sources, with a subsequent model to self sustain certain community-components.

7.2.3. Coir Sector

The status, factor conditions and history of earlier interventions in this sector, as discussed in an earlier section, make for a more nuanced and measured approach. Additionally, given the poor performance and prevailing below-minimum-wages levels of compensation, user contribution is envisaged only in terms of capacity building and re-training for new skills.

Government support: 70%



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Private sector participation is envisaged more in the new-product development area that emerges from the need for resource deepening and creation of additional economic opportunities for workers. The focus here is more on coordination, integration, re-skilling existing workers, resource deepening and creating strong, direct market links. With lower creation of new infrastructure, greater focus on softer interventions and harnessing the existing dissipated and disparate efforts, the sector has a smaller quantum of investment, t the extent that may be absorbed and perform efficiently.

7.2.4. Tourism Sector

Recognised as the sector with the most potential for development in the area, it is also envisaged to be almost entirely private sector-driven. Costing almost 43% of the total program, it envisages only 8% investment from government sources as opposed to other sectors where government support ranges from 46% to 80%. In addition, the costs proposed to be borne by the government relate to initial project development. It is expected that the subsequent investment would flow from the private sector with some zones proposed to be developed on a Public-Private-Partnership model, which would recover its own costs and would also, eventually, generate revenue for its operations and further development of the area.

7.2.5. Craft development and development of local village economies

This component, in addition to focusing on the development and support of local crafts, is also support with a view to linking with tourism development in the region. Given the present status of crafts, crafts-persons and the goods produced (mostly low-end), substantial training and design inputs are proposed.


Government support: 8% 92%


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As this is a sector where several government schemes can be utilised and given its present status, a higher government involvement in funding is suggested. Support for village development and local economy development is also included in the prepared set of initiatives to cover small enterprises like black-smithy, dairying, and agriculture, which may be promoted as experience-based tourism routes. This garners 5% of the overall costs and covers a wide area and range of activities. It also envisages a 15% user contribution.

7.3. PROJECT MANAGEMENT

The details regarding project management and implementation have been discussed in the previous section.


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8 COVERAGE AND IMPACTS

Focus and coverage Even as the focus/target areas (key sectors) for the proposed initiatives for the Growth Pole Programme have been covered in detail in the earlier section, this section highlights the envisaged coverage of the Growth Pole Programme and outlines ways to understand and assess its impacts: direct and indirect, quantitative and qualitative, within the sectors and externally, short, medium and long term impacts, given the activities anticipated under the programme. This exercise has not only help in estimating the envisaged benefits of the programme but was also used to help identify potential problem areas thus enabling a mitigation or management approach to address them better through institutional or other means.

Sector Impacts and Overall Impacts The following table lays out the envisaged impacts of the overall project as a before-after scenario to bring out the key aspects where impacts would be seen. It should be pointed out that indirect impacts are likely to roll across a number of sectors and are likely to make a difference to a wider degree than is captured here.


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Cashew Sector

Cashew STATUS: [Year 0] PROJECTED: [Year 5] LONGER TERM: [Year 10]

Units Number and type

614 Units These are all processing and packing units. No value addition is being undertaken yet.

650 Units Rationalisation of existing number of units, addition of some units that undertake value addition.

Projected increase to 750 Units as more small and medium size value addition

Employment (Total)

1,76,632 persons Workers are being drawn from the local area, migrant workers in the “kudivarrupu”

l0-15% additional jobs is seen in terms of higher value realisation, efficiency, skills and value addition, very low growth in numbers is forecast.

Employment- existing closed units becoming active & move days of employment. New value addition units. These jobs incremental to these

Employment (Women) Composition of work-force

90-97% women employees Average Age of women employees -40yrs

Participation by women will remain in the same proportion, with training for women to increase levels of responsibility (employability). With sustained influx of women workers, the average age too, will be sustained

Turnover Rs 2007 Cr

10-15% improvement, 20% efficiency improvement will contribute as savings..

35% increase in value realization in MSME units – (tech imp, env imp, work env improvement, valve addition

Average Incomes of shelling/peeling/sorting staff Mostly women, lowest paid, forming the bulk of the staff

Rs 3,000 per month In line with the minimum wages prescribed by the state and higher than the base wages in other sectors

15% increase to Rs 5,000 per month Based on improved

About 25% increase to Rs 8,000 per month. 60% increase of incomes acres 5 Yrs (at 10% compounded)?


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Worker environment (Minimum/optimum health and safety environment)

Present worker environment conditions are poor. No systems to address safety issues No considerations for occupational health issues

25% improvement in sorting & labour Improved work environment Safety issues addressed.

Continued improvement in sorting & labour Improved work environment Safety issues addressed

Worker environment (Minimum standards of women’s work environment)

Worker conditions are poor. No systems to address occupational health issues among women

Efficiency improvement in sorting & labour Improved work environment for women Women’s occupational health issues addressed.

Continued improvement. Consider reporting and applying for established certification systems

Regulatory Compliance Compliance of units to labour laws is good for all the ‘legal’ units. Continued compliance,

Value Addition (new units) Very little. New units set –up. Demonstration effect. Greater value addition efforts Branding & impend marketing: fuel sector growth

None Starting the process for establishing and promoting a brand, internally and for export market.

Established and recognised in both the local and export markets.

Fisheries Sector

Fisheries STATUS : Year 0 PROJECTED : Year 5 Year 10

Employment 38,976 in Growth Pole Area

Sustainable numbers with improved conditions, more employed in processing, less in fishing activity. Numbers likely to balance each other out and remain the same.

Numbers remain the same, leading to conditions of improvement in incomes, value realisation, resource conservation etc. (Migration to other sectors like tourism.

Turnover 0


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Av Incomes 3,000

Women employed in Peeling (pre-processing activity)

Roughly 200 days of employment a year (trawler ban) Surplus days available for tourism etc. Training for diversified skills and income generation

Rs 3.500- Rs 4,500 per month with fish processing related an tourism related activities through the year, increased no of days of employment in the year and better wages

Improved wages and value realisation, greater value addition, base wages at Rs 5,000/- and rising.

Fisherfolk (small-craft fishermen in the marine sector and Inland fisheries sector)

Lower returns and poor value realisation for fish caught (leads to a vicious cycle of over fishing and catching fingerlings, destructive fishing practises)

Diversified dependence with tourism

Establishing themselves as small entrepreuners in the tourism sector i

Fish catch

Problems with variety, quality, size etc. Water quality issues. Illegal Net usage issues, over exploitation of resources. Over fishing

10% increase in 3 years 20% improvement in 5 yrs Improved water quality (though Lake management)

40% improvement in 10 years With value addition –increased exports earnings Lake conservation and resource conservation, environment and resource quality improvement. (Lake management measures)

Re-skilling Employability

Increasing numbers dependent on activity, leading to problems of earning, over fishing etc.

Re-skilling into other employment opportunities, spl for the tourism sector.

Sustainable numbers and persons dependent on fishing for the benefit of the resource and the community.

Note: Water quality set to improve through a combination of interventions targeting the sector and the resource, under Fisheries interventions, Lake management measures, infrastructure improvement in Kollam Town to address issues of waste dumping (solid and liquid, into the lake and shore areas) alternative retting practices (defibring) and skill-diversification to tourism industry.


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Fisheries: positive impact. Fish catch imp 10% (3 yrs); 25% in 5 yrs.; 50% in (20 yrs) –Given stabilized controlled & regulated activities

Coir Sector

Coir STATUS : Year 0 PROJECTED : Year 5 Year 10

Units

9390

Lesser units (in terms of numbers) but increased profitability, combining of units into small employee-held/driven companies, societies.

Establishment of more middle-size units with integrated value chains and efficient backward and forward linkages. Better cooperation between units along value chain. More diversification of products for greater profitability

Employment

20,531

25,000 persons gainfully employed with at least minimum wage- levels of income. 8% increase over base year.

Sustainable employment, greater diversification of product and greater integration of value chain. 12% increase

Turnover Rs 58Cr Significant increase 30-35% increase.

Potential of exports doubling And turnover crossing 100 Cr.

Av Income 3000 8% increase over base year, for lowest wage earners.

12% increase over base year for lowest wage earners.

Re-skilling Employability

Increasing numbers involved with defunct cooperatives, leading to problems of earning, stagnation, etc.

Re-skilling into other products, areas of coir related work (coconut shell based, pith based, etc) employment opportunities, option of working with tourism sector.

Sustainable numbers and persons dependent on fishing for the benefit of the resource and the community.


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Note: Impacts geared toward helping current workers to earn better.. reskilling cooperative sector workers for greater or alternative employability.. Improving marketing, technology and processing infrastructure, also, moving from cooperative grant based mode to entrepreneurial mode , with increased scope for self-employability. Women—option of home based work linked to a collective structure supported by strong market links

Tourism Sector

Tourism STATUS : Year 0 PROJECTED : Year 5 Year 10 Tourists in lacs 1.31 2.44 7.56

Tourist Numbers

Tourist is not a transient tourist but a person who will stay for 3-5 days in the project area. This provides huge opportunities for the local area in terms of services and products

Incremental spending I (in Rs Crores) - 102.56 725.08 Incremental Income to Growth Pole region (In Rs crores) - 50.54 391.17 Direct Jobs (cumulative) 3522 36,160 Artisans / Activity coverage of people linked to tourism development plan 4350


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Qualitative impact: .The interventions proposed have the following enablers for the area to benefit: Development of top quality tourism accommodation facilities Strong linkages with the local culture, crafts and economy for providing sales opportunities Alternative employment avenues to the local area which is industrially stagnant through tourism support services. Such support services provide jobs in areas that will appeal to the education and income profile of the area e g retail, financial services, high value transport; while those people in struggling income earning categories such as farmers, fisherfolk, artisans will now get chances to enhance their incomes. The promenade project and walkway will also provide coastal villages on the fishing belt opportunities in F&B, culture and handicrafts and the tourist will be a “sticky client” on foot or cycle and not a drive through client. The entire set of interventions has been conceived with strong community participation and will thus receive support from the community. In such an environment and with clear private sector investment interest in core tourism assets, Kollam is well positioned to grow economically because of Tourism. Small Enterprises Sector STATUS : Year 0 PROJECTED : Year 5 Year 10 Employment Zero0 700 2500

Group formation (including collective activities, thrift and credit, loans etc.)

0

Anywhere between 70-120 groups, depending on the number of persons per group and types of specialities

Grouping and organisation into small companies, for some with a greater variety of services.

Average Incomes

Since the initiative is targeted at the educated unemployed youth (people who have passed XII), the base incomes are being assessed as zero.

Monthly incomes of a minimum of Rs 5,000/- (Rs 175 day) with some organised groups doing better than others, this figure could go up to Rs 10,000 per month.

Monthly incomes ranging from Rs 7,000 to Rs 20,000/- depending on nature and form of work.


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Overall Impacts STATUS : Year 0 PROJECTED : Year 5 Year 10

Units

Some 10,000 units in key sectors.

With increase of enterprise based work and initiatives, increased opportunities in alternative sectors, value chain integration and altered formats of association (cooperatives, companies, societies), these numbers likely to go up to 15,000 profit-oriented units.

Increase in mid-size units and sustainable numbers of small size units, with overall numbers also stabilising with an orientation to greater profits and better worker quality and conditions. Increase in Service sector units as well in areas like tourism (tour operators, travel based services, other services)

Employment

Current employment base of 2.36 lakh workers in the three key sectors

Moderate increase in total numbers but more sensitive to income and worker environment improvement (significant). Greater opportunity for absorption of the educated unemployed, women workers, greater diversification of skill base and opportunity for various levels and types of employment. 7-9 % increase. [Note: with stagnant population growth rates, that also threaten to become negative in some parts, conscious efforts have been made to emphasise the quality of employment, rather than numbers.]

10-12 % increase over base year with greater retention of older workers and diversified employment opportunities. [Note: projected population growth rates, that may become negative in some parts, with an increasing population of older employees a conscious effort have been made to emphasise the worker environment, length of employment –occupational health- quality of employment, rather than numbers.]


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Average Income Employment opportunities Mid-level jobs. Employability

Good record of minimum wages being honoured in the cashew sector and better wage rates than the rest of the country in fisheries though more compromised in the case of coir sector. Women, make lower cuts compared to men in the same sector. Few mid-level job opportunities. Rs 3300-1600 per month, (base wages) depending on sector

Combination of sector specific measures (including branding, worker environment improvement, diversified skills, training for better efficiencies etc etc ) are all geared to increase industry performance to enable a parallel increase in wage rates, and economic opportunities across the board. Likely to improve to a minimum of Rs 5,000- 2,500/- per month and a greater increase in mid-level jobs with monthly incomes of Rs 10,000-15,000/- as well

Diversified increase in the key sectors, combined with new industry, and service sector development and increase will lead to a greater jump across this longer period. A expected swell in mid-level job opportunities for the educated (depending on level of qualification) and greater opportunity for skill based training for employability will result in improved wages and job opportunities, including opportunity for self-employment (diversified and integrated value chain) 15-25% increase in base wages in key sectors. Base wages in key sectors at Rs 8,000-4,000/-


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To summarise, the employment generation, with direct employment /economic opportunities created, sector-wise have been discussed in the preceding description. Proposed infrastructure (construction etc) will also generate local jobs. That number has not been included in this estimate of direct employment generated It is estimated that apart from some additional direct employment, indirect employment will be generated as a result of the interventions- this will not only be confined to the Growth Pole Area. As mentioned in the previously, several strategies would come into play to address this demand-supply of opportunities. Some possible ways are:

1. Improved work-force participation, especially among women and the educated unemployed youth that are intended targets of some interventions.

2. Reduced unemployment and disguised unemployment, particularly from the cooperative sector

3. Migration to the area by workers from the surrounding areas or even other places, as has been the case with the Cashew Sector, in the recent past.

4. The improved employability among the trained youth in various sectors may also lead to greater mobility (vertical and geographic) of the local workforce, as is also a feature in specific sectors in the state.

growth pole programme: kollam - il&fs clustersilfsclusters.com/pdf/kollam final dpr.pdf ·...

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