Fair Trade and sustainable rural development: case studies on the role of producer companies in India
Sustainable development has acquired a new thrust with the focus on the Sustainable Development Goals (SDGs) by the United Nations. At the same time, there are many public and private sustainability standards in the food and fibre sector which address sustainability, such as organic, ethical, and Fair Trade as market-based systems. This paper assesses the impact of Fair Trade on the SDGs at the local level in terms of income of the producers by considering both Fair Trade and Non-Fair Trade farmers in the specific context of the producer companies involved in Fairtrade-Certified peanut production and its marketing in Gujarat, India. It was found that Fairtrade provided an alternative outlet for farmer produce though it had poor impact in terms of uptake of Fairtrade-Certified produce and prices delivered were low compared with those in existing channels. On the other hand, worker issues were not addressed due to the prevalence of labour tenancy in the study area.Abraham, M. and Pingali, P. (2017) ‘Transforming smallholder agriculture to achieve the SDGs’, in L. Riesgo, S. Gomez-Y-Paloma, and K. Louhichi (eds), The Role of Small Farms in Food and Nutrition Security [online], New York: Springer <https://tci.cornell.edu/wp-content/uploads/2017/08/2017-Abraham-Pingali-Transforming-Smallholder-Agriculture-to-Achieve-the-SDGs.pdf> [accessed 2 August 2019].
Argade, A. and Singh, S. (2016) ‘Seeking markets in production fields: an assessment of the potential for fair trade in India’, Millennial Asia 7(2): 131−52.
Bacon, C.M., Sundstrom, W.A., Gómez, M.E.F., Méndez, V.E., Santos, R., Goldoftas, B. and Dougherty, I. (2014) ‘Explaining the “hungry farmer paradox”: smallholders and fair trade cooperatives navigate seasonality and change in Nicaragua’s corn and coffee markets’, Global Environmental Change 25: 133−49 <https://doi.org/10.1016/j.gloenvcha.2014.02.005>.
Biggs, S. and Lewis, D. (2009) ‘Fair trade and organizational innovation in Nepal: lessons from 25 years of growth of the Association of Craft Producers (ACP)’, The European Journal of Development Research 21(3): 377−96 <https://doi.org/10.1057/ejdr.2009.11>.
Das, B. (2006) ‘Problems and prospects of the cooperative movement in India under the globalization regime’, paper presented at the XIV International Economic History Congress, Helsinki 2006, Session 72 [online] <http://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.575.292> [accessed 10 October 2019].
Dey, K. (2018) ‘Farmer producer companies in India: determinants of performance and viability’, Economic & Political Weekly 53(35): 44−52.
Elliott, K. (2012) Is My Fairtrade Coffee Really Fair? Trends and Challenges in Fair Trade Certification, CGD Policy Paper 17 [online], Center for Global Development <https://www.cgdev.org/sites/default/files/archive/doc/full_text/policyPapers/1426831/Is-My-Fair-Trade-Coffee-Really-Fair.html> [accessed 10 October 2019].
Fair World Project (2012) Issues and Challenges in Fair Trade: For a Better World [online], Portland, OR: FWP Publication <https://fairworldproject.org/wp-content/uploads/2012/08/FWP_publication_Issue4.pdf> [accessed 10 October 2019].
Francesconi, G.N. and Ruben, R. (2014) ‘Fair Trade’s theory of change: an evaluation based on the cooperative life cycle framework and mixed methods’, Journal of Development Effectiveness 6(3): 268−83 <https://dx.doi.org/10.1080/19439342.2014.918164>.
FTI (Fairtrade International) (2013) Fairtrade Theory of Change, <https://www.fairtrade.net/impact/our-theory-of-change>
Government of India (GOI) (2017) Agricultural Wages in India 2015−16 [online], Department of Agriculture, Cooperation & Farmers Welfare <https://eands.dacnet.nic.in> [accessed 2 August 2019].
GOI (2018a) All India Report on Number and Area of Operational Holdings: Agriculture Census 2015−16 [online], Agriculture Census Division, Department of Agriculture <http://agcensus.nic.in> [accessed 11 February 2019].
GOI (2018b) ‘Revised wage rate of Mahatma Gandhi NREG Act, 2005’ [online], Ministry of Rural Development <https://nrega.nic.in> [accessed 2 August 2019].
Gowda, C., Dixit, S. and Megha, H.L. (2018) ‘Women’s participation in Karnataka’s FPOs’, Economic & Political Weekly 53(45): 20−2.
Hira, A. and Ferrie, J. (2006) Fair Trade: three key challenges for reaching the mainstream’, Journal of Business Ethics 63(2): 107−18.
Holm, F. and Lindgren, S. (2017) Impacts of Fairtrade on Small-Scale Cotton Producers: A Field Study in Rural India [pdf], Bachelor’s thesis, Department of Economics at the University of Gothenburg <https://gupea.ub.gu.se/bitstream/2077/53773/1/gupea_2077_53773_1.pdf> [accessed 10 February 2019].
IIED (International Institute for Environment & Development) (2000) Fair Trade: Overview, Impact, Challenges: Study to Inform DFID’s Support to Fair Trade [pdf], London: IIED <http://www.csa-be.org/IMG/pdf_DFID_Fair_Trade_study.pdf> [accessed 20 January 2019].
IOPEPC (n.d.) IOPEPC Kharif: 2017 Survey of Groundnut Crop, Mumbai: Ministry of Commerce, Government of India.
ITC (International Trade Centre) (2015) Edible Nuts: Groundnuts. Groundnut Quarterly Bulletin June 2015 [online] <http://www.intracen.org/uploadedFiles/intracen.org/Content/Exporters/Market_Data_and_Information/Market_information/Market_Insider/Edible_Nuts/Groundnut%20Quarterly%20Bulletin%20June%202015.pdf> [accessed 10 October 2019].
Karki, S.K., Jena, P.R. and Grote, U. (2016) ‘Fair trade certification and livelihoods: a panel data analysis of coffee-growing households in India’, Agricultural and Resource Economics Review 45(3): 436−58 <https://doi.org/10.1017/age.2016.3>.
Karunakaran, N. and Thomas, S. (2017) ‘Fair Trade Alliance Kerala and marketing of organic commodities: a case study of Kasaragod’, JIM QUEST 13(2): 2−6.
Kumar, S., Meena, P. and Panigrahy, S. (2017) ‘Changing dynamics of tenant farming in India: an insight from Gujarat’, Indian Journal of Economics and Development 13(1): 65−70 <https://doi.org/10.5958/2322-0430.2017.00009.9>.
Mook, A. and Overdevest, C. (2017) ‘Does Fairtrade certification meet producers’ expectations related to participating in mainstream markets? An analysis of advertised benefits and perceived impact’, Sustainable Development 26(3): 269−80 <https://doi.org/10.1002/sd.1700>.
Nelson, V. and Martin, A. (2012) ‘The impact of Fairtrade: evidence, shaping factors, and future pathways’, Food Chain 2(1): 42−63 <http://dx.doi.org/10.3362/2046-1887.2012.005>.
Nelson, V. and Pound, B. (2009) The Last Ten Years: A Comprehensive Review of the Literature on the Impact of Fairtrade, Greenwich: Natural Resources Institute.
Pound, B. (2013) Branching Out: Fairtrade in Malawi: Monitoring the Impact of Fairtrade on Five Certified Organisations, London: Natural Resources Institute, Malawi Fairtrade Network, Fairtrade Africa, and the Fairtrade Foundation, UK.
Ranjan, P. and Grote, U. (2017) ‘Fairtrade certification and livelihood impacts on small-scale coffee producers in a tribal community of India’, Applied Economic Perspectives and Policy 39(1): 87−110 <https://doi.org/10.1093/aepp/ppw006>.
Raynolds, L., Murray, D. and Taylor, P. (2004) ‘Fair Trade coffee: building producer capacity via global networks’, Journal of International Development 16(8): 1109−21.
Rosairo, H., Lyne, M., Martin, S. and Moore, K. (2012) ‘Factors affecting the performance of farmer companies in Sri Lanka: lessons for farmer-owned marketing firms’, Agribusiness 28(4): 505−17 <https://doi.org/10.1002/agr.21312>.
Ruben, R. and Van Schendel, L. (2008) ‘The impact of Fair Trade in banana plantations in Ghana: income, ownership and livelihoods of banana workers’, in R. Ruben (ed.), The Impact of Fair Trade, pp. 137−54, Wageningen: Wageningen Academic Publishers.
Seetharaman, G. (2017) ‘Why paper boat chose to launch a fairtrade product’, The Economic Times, 5 February 2017.
Shah, T. (2016) ‘Farmer producer companies’, Economic & Political Weekly 51(8): 15−20.
Sharma, V. (2014) Problems and Prospects of Oilseeds Production in India, Singapore: Springer.
Singh, S. (2008) ‘Producer companies as new generation cooperatives’, Economic and Political Weekly 43(20): 22−4.
Singh, S. (2013) ‘The practice of contract farming in India: making it inclusive and effective’, Food Chain 3(3): 137−54 <http://dx.doi.org/10.3362/2046-1887.2013.014>.
Singh, S. (2017) ‘“White gold” for whom? A study of institutional aspects of work and wages in cotton GPNs in India’, in E. Noronha and P. D’Cruz (eds), Critical Perspectives on Work and Employment in Globalizing India, pp. 15−36, Singapore: Springer.
Singh, S. (2019) ‘Competing for space and making a difference? An assessment of sustainability standards in the Indian cotton sector’, in B. Arora, P. Budhwar, and D. Jyoti (eds), Business Responsibility and Sustainability in India, pp. 129−60, Cham, Switzerland: Palgrave Macmillan.
Singh, S. and Singh, T. (2014) Producer Companies in India: A Study of Organization and Performance, New Delhi: Allied Publishers.
Smith, A.M. (2013) ‘Fair trade governance and diversification: the experience of the National Smallholder Farmers’ Association of Malawi’, Geoforum 48: 114−25 <https://doi.org/10.1016/j.geoforum.2013.04.020>.
Trebbin, A (2014) ‘Linking small farmers to modern retail through producer organisations: experience with producer companies in India’, Food Policy 45: 35−44 <https://doi.org/10.1016/j.foodpol.2013.12.007>.
Trebbin, A. and Hassler, M. (2012) ‘Farmers’ producer companies in India: a new concept for collective action?’ Environment and Planning A 44(2): 411−27 <https://doi.org/10.1068/a44143>.
Vaidyanathan, A. (2013) ‘Future of cooperatives in India’, Economic & Political Weekly 48(18): 30−4.
Vásquez-León, M. (2010) ‘Free markets and fair trade, collective livelihood struggles, and the cooperative model: two case studies from Paraguay’, Latin American Perspectives 37(6): 53−73 <https://doi.org/10.1177/0094582X10382099>.
Wadkar, S. (2018) ‘Farmer producers organization: present status, challenges and way forward’, Cooperative Perspective 53(1): 71−80.
Abraham, M. and Pingali, P. (2017) ‘Transforming smallholder agriculture to achieve the SDGs’, in L. Riesgo, S. Gomez-Y-Paloma, and K. Louhichi (eds), The Role of Small Farms in Food and Nutrition Security [online], New York: Springer <https://tci.cornell.edu/wp-content/uploads/2017/08/2017-Abraham-Pingali-Transforming-Smallholder-Agriculture-to-Achieve-the-SDGs.pdf> [accessed 2 August 2019].
Argade, A. and Singh, S. (2016) ‘Seeking markets in production fields: an assessment of the potential for fair trade in India’, Millennial Asia 7(2): 131−52.
Bacon, C.M., Sundstrom, W.A., Gómez, M.E.F., Méndez, V.E., Santos, R., Goldoftas, B. and Dougherty, I. (2014) ‘Explaining the “hungry farmer paradox”: smallholders and fair trade cooperatives navigate seasonality and change in Nicaragua’s corn and coffee markets’, Global Environmental Change 25: 133−49 <https://doi.org/10.1016/j.gloenvcha.2014.02.005>.
Biggs, S. and Lewis, D. (2009) ‘Fair trade and organizational innovation in Nepal: lessons from 25 years of growth of the Association of Craft Producers (ACP)’, The European Journal of Development Research 21(3): 377−96 <https://doi.org/10.1057/ejdr.2009.11>.
Das, B. (2006) ‘Problems and prospects of the cooperative movement in India under the globalization regime’, paper presented at the XIV International Economic History Congress, Helsinki 2006, Session 72 [online] <http://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.575.292> [accessed 10 October 2019].
Dey, K. (2018) ‘Farmer producer companies in India: determinants of performance and viability’, Economic & Political Weekly 53(35): 44−52.
Elliott, K. (2012) Is My Fairtrade Coffee Really Fair? Trends and Challenges in Fair Trade Certification, CGD Policy Paper 17 [online], Center for Global Development <https://www.cgdev.org/sites/default/files/archive/doc/full_text/policyPapers/1426831/Is-My-Fair-Trade-Coffee-Really-Fair.html> [accessed 10 October 2019].
Fair World Project (2012) Issues and Challenges in Fair Trade: For a Better World [online], Portland, OR: FWP Publication <https://fairworldproject.org/wp-content/uploads/2012/08/FWP_publication_Issue4.pdf> [accessed 10 October 2019].
Francesconi, G.N. and Ruben, R. (2014) ‘Fair Trade’s theory of change: an evaluation based on the cooperative life cycle framework and mixed methods’, Journal of Development Effectiveness 6(3): 268−83 <https://dx.doi.org/10.1080/19439342.2014.918164>.
FTI (Fairtrade International) (2013) Fairtrade Theory of Change, <https://www.fairtrade.net/impact/our-theory-of-change>
Government of India (GOI) (2017) Agricultural Wages in India 2015−16 [online], Department of Agriculture, Cooperation & Farmers Welfare <https://eands.dacnet.nic.in> [accessed 2 August 2019].
GOI (2018a) All India Report on Number and Area of Operational Holdings: Agriculture Census 2015−16 [online], Agriculture Census Division, Department of Agriculture <http://agcensus.nic.in> [accessed 11 February 2019].
GOI (2018b) ‘Revised wage rate of Mahatma Gandhi NREG Act, 2005’ [online], Ministry of Rural Development <https://nrega.nic.in> [accessed 2 August 2019].
Gowda, C., Dixit, S. and Megha, H.L. (2018) ‘Women’s participation in Karnataka’s FPOs’, Economic & Political Weekly 53(45): 20−2.
Hira, A. and Ferrie, J. (2006) Fair Trade: three key challenges for reaching the mainstream’, Journal of Business Ethics 63(2): 107−18.
Holm, F. and Lindgren, S. (2017) Impacts of Fairtrade on Small-Scale Cotton Producers: A Field Study in Rural India [pdf], Bachelor’s thesis, Department of Economics at the University of Gothenburg <https://gupea.ub.gu.se/bitstream/2077/53773/1/gupea_2077_53773_1.pdf> [accessed 10 February 2019].
IIED (International Institute for Environment & Development) (2000) Fair Trade: Overview, Impact, Challenges: Study to Inform DFID’s Support to Fair Trade [pdf], London: IIED <http://www.csa-be.org/IMG/pdf_DFID_Fair_Trade_study.pdf> [accessed 20 January 2019].
IOPEPC (n.d.) IOPEPC Kharif: 2017 Survey of Groundnut Crop, Mumbai: Ministry of Commerce, Government of India.
ITC (International Trade Centre) (2015) Edible Nuts: Groundnuts. Groundnut Quarterly Bulletin June 2015 [online] <http://www.intracen.org/uploadedFiles/intracen.org/Content/Exporters/Market_Data_and_Information/Market_information/Market_Insider/Edible_Nuts/Groundnut%20Quarterly%20Bulletin%20June%202015.pdf> [accessed 10 October 2019].
Karki, S.K., Jena, P.R. and Grote, U. (2016) ‘Fair trade certification and livelihoods: a panel data analysis of coffee-growing households in India’, Agricultural and Resource Economics Review 45(3): 436−58 <https://doi.org/10.1017/age.2016.3>.
Karunakaran, N. and Thomas, S. (2017) ‘Fair Trade Alliance Kerala and marketing of organic commodities: a case study of Kasaragod’, JIM QUEST 13(2): 2−6.
Kumar, S., Meena, P. and Panigrahy, S. (2017) ‘Changing dynamics of tenant farming in India: an insight from Gujarat’, Indian Journal of Economics and Development 13(1): 65−70 <https://doi.org/10.5958/2322-0430.2017.00009.9>.
Mook, A. and Overdevest, C. (2017) ‘Does Fairtrade certification meet producers’ expectations related to participating in mainstream markets? An analysis of advertised benefits and perceived impact’, Sustainable Development 26(3): 269−80 <https://doi.org/10.1002/sd.1700>.
Nelson, V. and Martin, A. (2012) ‘The impact of Fairtrade: evidence, shaping factors, and future pathways’, Food Chain 2(1): 42−63 <http://dx.doi.org/10.3362/2046-1887.2012.005>.
Nelson, V. and Pound, B. (2009) The Last Ten Years: A Comprehensive Review of the Literature on the Impact of Fairtrade, Greenwich: Natural Resources Institute.
Pound, B. (2013) Branching Out: Fairtrade in Malawi: Monitoring the Impact of Fairtrade on Five Certified Organisations, London: Natural Resources Institute, Malawi Fairtrade Network, Fairtrade Africa, and the Fairtrade Foundation, UK.
Ranjan, P. and Grote, U. (2017) ‘Fairtrade certification and livelihood impacts on small-scale coffee producers in a tribal community of India’, Applied Economic Perspectives and Policy 39(1): 87−110 <https://doi.org/10.1093/aepp/ppw006>.
Raynolds, L., Murray, D. and Taylor, P. (2004) ‘Fair Trade coffee: building producer capacity via global networks’, Journal of International Development 16(8): 1109−21.
Rosairo, H., Lyne, M., Martin, S. and Moore, K. (2012) ‘Factors affecting the performance of farmer companies in Sri Lanka: lessons for farmer-owned marketing firms’, Agribusiness 28(4): 505−17 <https://doi.org/10.1002/agr.21312>.
Ruben, R. and Van Schendel, L. (2008) ‘The impact of Fair Trade in banana plantations in Ghana: income, ownership and livelihoods of banana workers’, in R. Ruben (ed.), The Impact of Fair Trade, pp. 137−54, Wageningen: Wageningen Academic Publishers.
Seetharaman, G. (2017) ‘Why paper boat chose to launch a fairtrade product’, The Economic Times, 5 February 2017.
Shah, T. (2016) ‘Farmer producer companies’, Economic & Political Weekly 51(8): 15−20.
Sharma, V. (2014) Problems and Prospects of Oilseeds Production in India, Singapore: Springer.
Singh, S. (2008) ‘Producer companies as new generation cooperatives’, Economic and Political Weekly 43(20): 22−4.
Singh, S. (2013) ‘The practice of contract farming in India: making it inclusive and effective’, Food Chain 3(3): 137−54 <http://dx.doi.org/10.3362/2046-1887.2013.014>.
Singh, S. (2017) ‘“White gold” for whom? A study of institutional aspects of work and wages in cotton GPNs in India’, in E. Noronha and P. D’Cruz (eds), Critical Perspectives on Work and Employment in Globalizing India, pp. 15−36, Singapore: Springer.
Singh, S. (2019) ‘Competing for space and making a difference? An assessment of sustainability standards in the Indian cotton sector’, in B. Arora, P. Budhwar, and D. Jyoti (eds), Business Responsibility and Sustainability in India, pp. 129−60, Cham, Switzerland: Palgrave Macmillan.
Singh, S. and Singh, T. (2014) Producer Companies in India: A Study of Organization and Performance, New Delhi: Allied Publishers.
Smith, A.M. (2013) ‘Fair trade governance and diversification: the experience of the National Smallholder Farmers’ Association of Malawi’, Geoforum 48: 114−25 <https://doi.org/10.1016/j.geoforum.2013.04.020>.
Trebbin, A (2014) ‘Linking small farmers to modern retail through producer organisations: experience with producer companies in India’, Food Policy 45: 35−44 <https://doi.org/10.1016/j.foodpol.2013.12.007>.
Trebbin, A. and Hassler, M. (2012) ‘Farmers’ producer companies in India: a new concept for collective action?’ Environment and Planning A 44(2): 411−27 <https://doi.org/10.1068/a44143>.
Vaidyanathan, A. (2013) ‘Future of cooperatives in India’, Economic & Political Weekly 48(18): 30−4.
Vásquez-León, M. (2010) ‘Free markets and fair trade, collective livelihood struggles, and the cooperative model: two case studies from Paraguay’, Latin American Perspectives 37(6): 53−73 <https://doi.org/10.1177/0094582X10382099>.
Wadkar, S. (2018) ‘Farmer producers organization: present status, challenges and way forward’, Cooperative Perspective 53(1): 71−80.
Tea farming communities’ perceptions of Fairtrade and COVID-19 in Phongsali district of Laos
Keovilignavong, Oulavanh
Anh Tran, Thong
Bounyasouk, Thavisith
Community Development, Vol. 54 (2023), Iss. 2 P.271
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