Godrej Industries Ltd. Regd. Office: Pirojshanagar, Eastern Express Highway, Vikhroli (E),Mumbai 400079. India. Tel. : 91-22-2518 8010/8020/8030 Fax: 91-22-2518 8068/8063/8074 Web Site: www.godrejinds.com RSPO Annual Communication of Progress. 1. Profile : Name of the Organisation Godrej Industries Limited Membership type Ordinary Report Prepared by Nasim Ali E.Mail [email protected] Report submitted by Rangarajan A. E. Mail ar. [email protected] Reporting Period September 2007 to August 2008 Date of Report October 13, 2008. 2. Details of Progress: A. Godrej Industries Limited is a user of Palm Oil / Palm Oil Products. Godrej Agrovet Limited, which is a subsidiary of Godrej Industries Ltd., is in the business of Oil Palm Plantations in India. In the last one year, i) We participated actively in the RT5 in Malaysia. ii) Mr. Dorab Mistry, Managing Director, Godrej International Ltd., who is an authority on Vegetable Oils in general and Palm Oil in particular, had delivered several talks, in various forums of international repute, where he had advocated the use of RSPO. Some of the lectures delivered are as follows : i. Price Outlook Conference of Bursa Malaysia in February 2008 ii. Globoil International in April 2008 at Dubai iii. World Palm Oil Summit in May 2008 in Jakarta iv. Palm Oil Trade Fair & Seminar ( POTS ) of MPOC in Mumbai in May 2008 v. Palm Oil Trade Fair & Seminar International ( POTS ) of MPOC in Kuala Lumpur in August 2008 vi. World Oils & Oilseeds Conference in September 2008 in Singapore B. Godrej Industries Limited sponsored RT5 in Malaysia, to the tune of RM 50,000/- We also hope to participate actively in RT6. Mr.N.B.Godrej, Managing Director, Godrej Industries Ltd., will be delivering a talk on “An Indian Perspective” at RT6. C. Godrej Agrovet Limited, a subsidiary of Godrej Industries Ltd., is involved in the business of Oil Palm plantations in India. A brief note on their activities is as follows : 1. OIL PALM DEVELOPMENT ON PUBLIC – PRIVATE PARTNERSHIP MODEL Oil Palm is the highest edible oil yielding plant among perennial oil yielding crops. Two types of edible oils are extracted from Oil Palm . One is from the mesocarp of the fruit (known as Crude Palm Oil ) and the other is from kernel of the seed (known as Palm Kernel Oil ). Both these Oils have edible and industrial value and are in great demand .It has been proved that the oil yield can go up to 5M.T. per Hectare by adopting suitable cultivation practices . Oil Palm starts yielding from 3rd year of planting and harvesting can be done at 10 to 15 days interval for 25 to 30 years. India has the potential to develop Oil Palm in to ensure that the country becomes self sufficient in Edible Oil. In the 1970s , two public sector companies in Kerala and Andaman and Nicobar Islands introduced this crop in India on a plantation scale , for reafforestation . During the 7th Plan period the Department of Biotechnology, Ministry of Science and Technology , Government of India experimented / demonstrated cultivation of this crop in farmers’ fields under irrigated condition in three states namely Andhra Pradesh, Karnataka and Maharashtra ( 1000 Ha each ). Based on the experience gained in these states , the Technology Mission on Oil Seeds and Pulses ( TMOP ) , Department of Agriculture and Co-operation , Ministry of Agriculture , GOI , New –Delhi has been implementing the Oil Palm Development Project (OPDP) in 11 states in the country since 8th plan period under public – private partnership mode. In the 9th plan the project was merged with the Integrated Scheme on Oil Seeds, Pulses , Oil Palm and Maize (ISOPOM) of TMOP & M , New Delhi. The Oil Palm Development Scheme under ISOPOM integrates the Central Government, State Government , ICAR , Entrepreneurs and Farmers for promotion of this crop in various states. Under this model, the policy guidelines are formulated by the Central Government. Subsidies are extended to the farmers under various components, which are shared in the ratio of 75% and 25% between the Central and State Governments respectively. The R & D activities pertaining to this crop are carried out by ICAR. Entrepreneurs are allotted Factory Zones in various states by the respective State Governments for promotion of this crop , in association with the Department of Agriculture / Horticulture . Extension activities are carried out jointly by the Entrepreneurs and the Department. It is the responsibility of the Entrepreneurs to set up Palm Oil Mills for processing Oil Palm FFBS produced by the farmers . The Entrepreneurs enter into a assured buy-back arrangement with the farmers for 25- 30 years . The price for FFBs is fixed periodically by a Committee constituted by the State Government for the purpose. The Entrepreneurs also assist the farmers in availing term loans / crop loans from commercial and Co-Operative bank by means of tri-partite agreement. The State Government monitors all these activities and some of them have enacted legislations for regulation of production and processing of this crop. This model has proved successful in large scale contract farming of Oil Palm in several states . The Central Government has an ambitious plan to develop this crop in area of about 10.0 lakh hectares in the country in a phased manner. The gist of the scheme is: ¾ State Govt. encourages entrepreneurs to take up promotional activities & Oil Palm cultivation through land owning farmers in the area, where Oil Palm can be grown successfully. ¾ It is a tripartite activity (Govt,farmers & enterpreneurs). ¾ Establishment of project office in factory zone. ¾ Establishment of nurseries & supply of best quality plant material to farmers. ¾ Personnel for extension services. ¾ Training of Staff & farmers. ¾ Assistance to avail credit facility from banks : Tripartite Agreement ( Bank, farmers & entrepreneurs). ¾ Establishment of Palm Oil mill in factory zone. ¾ Establishment of FFB collection centres. ¾ Fixation of price of FFB by state Govt. & payment to farmers within 15 days. ¾ Oil Palm Act - For regulation of production and processing. 2. Criteria for selection of farmers towards crop conversion to Oil Palm ¾ Soil depth minimum 1.2 meters & soil pH in the range of acidic to neutral. ¾ Availability of irrigation sources like borewell, openwell, river, lift irrigation etc etc. ¾ Minimum land size - half Ha. ¾ Land should be open (not covered under any tree) & no forest land converted. ¾ Generally crop like Cashew, mango,lemon orchard, coconut etc etc... perennial crop converted to Oil Palm. ¾ Sugarcane, banana, maize, paddy, vegitables etc ... annual or short duration crop converted to Oil Palm. 3. Benificial impact of conversion into Oil Palm ¾ Economics.. : Farmers gain in the region of Rs. 50,000 to Rs 60,000/Hecatre de[pending on the Price prevailing for CPO. No middleman involved, who can otherwise skim away the margins. ¾ Environment : o For Every unit of land brought into production of Palm Oil at least 5 units of land under say soyabeen can be released for reforestation. o Oil Palm, a tree crop of water conservation : The crop reduces run off leading to larger infiltration and water conservation in soil than annual crops. In addition, the cultivation of Palm Oil with its successful approach to integrated pest management (IPM) is more eco -friendly than practices in other crops. ¾ Employment: This cultivation helps to uplift the earnings of rural people / provides rural employment in the form of engagement of workers, harvesters & transporters etc etc. @ minimum One employee per Ha. per year apart from employment in the Oil Mills and the refineries that come up in the rural areas. D. Godrej Consumer Products Limited, Godrej Industries Limited and Godrej Agrovet Limited have become members of the Unilever Coalition on Sustainable Palm oil and will work closely with other members of the Coalition as well as with Growers and all Stakeholders at the RSPO to promote and gradually expand the use of Sustainable Palm Oil and encourage Sustainable Practices in the industry. Mr Dorab Mistry liaises with the Coalition members and is working for a fruitful outcome within the framework of the RSPO with the full and active participation and agreement of the industry. .