Livelihood Based Agri Business and Market Studies for North East Rural Livelihood Project Final report, Sikkim April 2011 Submitted by MART A-32, 1st Floor, Sector 17, Noida - 201 301 Tel: 0120-2512140, Fax: 0120-4273995 www.martrural.com Livelihood based Agri Business and Market Study in Sikkim Acknowledgement At the onset, we extend our thanks to DoNER for giving us this opportunity to undertake this important livelihood study under NERLP. We thank Mr. Alok Kumar Shrivastava, Project Director, NERLP and his entire team at Guwahati for their constant guidance and unconditional support during the entire study period. A number of meetings with him and his team at Guwahati and Delhi helped in smooth completion of the assignment. We would again like to thank him for his and team support for facilitating the stakeholders’ workshops in states. NERLP feedback on draft report has helped us improve it suitably to make it a useful project document. We would like to sincerely thank Mr. Biswajit Sen, Senior Rural Development Specialist, and Mr. Nathan M. Belete, Senior Rural Development Economist at World Bank for their constant support in ensuring completion of the study; the first meeting at World Bank office along with PD, NERLP helped finalize the report templates. Subsequently, the initial feedback after the first field visit has helped in finalizing selection of 5 economic activities for undertaking detailed value chain analysis in the state. We would also like to thank Mr. Varun Singh, Social Development Specialist at World Bank and Dr. Amarendra Singh for their valuable feedback on the study. We would also like to thank Shri A. K. Ganeriwala, Secretary RMDD, Dr. S. Tambe, Special Secretary RMDD and Shri D. T. Bhutia, State Coordinator NERLP for their critical support and wonderful coordination to make the study a reality. We would like to thank all state level officials and resource persons including Mr. A. K. Singh, District Collector, Namchi, Mr. J. S. Raje, SDM, Soreng, Dr. P. Senthil Kumar, MD, Sikkim Milk, Mr. B. Swaroop, MD, SIMFED, Mr. R. Gurung, CEO, ECOSS, Mr. Raj Basu of Help Tourism Private limited, Mr. J. C. Biswas DDM, NABARD, Mr. B. K. Rai, Joint Director HCCD, Dr. K.C. Bhutia, Joint Director, AHVS, Mr. B. Subba of VHAS, Mr. Vishal Mukhia, BDO, Sikkip and Ms. Chandrakala Rai, Deputy Director, SIRD who spared their valuable time to provide us important information and relevant documents. We particularly thank all the stakeholders present in the two highly informative and fruitful workshops conducted at Gangtok on 23rd August 2010 and 9th February 2011 for their invaluable contributions and feedback in guiding and finalizing the study. We would also like to thank all SIRD, HCCD and AHVS staff who facilitated and organized village meetings and also accompanied us in villages. We would like to thank a large numbers of villagers, SHG members, cooperative society office bearers, entrepreneurs who spent their valuable time with us in field and also a number of market players including wholesalers and retailers, processing units, transport services and various other support services at Gangtok and district markets. MART Team MART, Noida 1 Livelihood based Agri Business and Market Study in Sikkim Contents Abbreviations and Glossary of terms ...................................................................................................... 5 Executive Summary ................................................................................................................................... 6 Chapter 1: Background and methodology ............................................................................................. 12 1.1. Background ................................................................................................................................. 12 1.2. Objectives of the study ............................................................................................................... 12 1.3. Approach of the study ................................................................................................................ 13 1.4. Key features of study methodology ............................................................................................ 14 1.5. Limitations of the study .............................................................................................................. 15 Chapter 2: State Profile and Livelihood Issues .................................................................................... 16 2.1 State profile ................................................................................................................................. 16 2.2 Key indicators for project districts .............................................................................................. 17 2.3 Rural livelihood and poverty issues ............................................................................................ 17 Chapter 3: Livelihood Profile .................................................................................................................. 20 1.1 Overall Livelihoods Profile .......................................................................................................... 20 1.2 Infrastructure and Resource Profile ............................................................................................ 22 1.3 Banking and SHG Profile ............................................................................................................. 24 1.4 Market Profile ............................................................................................................................. 25 1.5 Land based livelihoods ................................................................................................................ 27 1.6 Floriculture .................................................................................................................................. 32 1.7 Live stock based livelihoods ........................................................................................................ 33 1.8 Service based livelihoods ............................................................................................................ 35 1.9 Rural tourism............................................................................................................................... 37 Chapter 4: Value Chain Analysis ............................................................................................................ 38 4.1 Introduction ................................................................................................................................ 38 4.2 Summary of suggested interventions ......................................................................................... 40 4.3 Value Chain of Dairy .................................................................................................................... 43 4.4 Value Chain of Ginger ................................................................................................................. 54 4.5 Value Chain of Pig ....................................................................................................................... 68 4.6 Value chain of Floriculture .......................................................................................................... 78 4.7 Value chain of Homestay Rural Tourism ..................................................................................... 90 MART, Noida 2 Livelihood based Agri Business and Market Study in Sikkim List of secondary sources/references .................................................................................................. 103 Annexure ................................................................................................................................................. 104 Annexure 1: Some Steps taken by the State Government ................................................................... 104 Annexure 2: List of participants for the stakeholder consultation workshop ..................................... 107 Annexure 3: List of select stakeholders met during the field visit ....................................................... 108 Annexure 4: Support plan for Dairy development in the NERLP Project Area .................................... 110 Annexure 5: Sikkim State Stakeholders Consultation Report ............................................................... 116 List of Tables Table 1: Key Indicators for project districts ................................................................................................ 17 Table 2: Surveyed Villages .......................................................................................................................... 20 Table 3: Infrastructure Profile ..................................................................................................................... 22 Table 4: Market Facilities ............................................................................................................................ 25 Table 5: Market Profile ............................................................................................................................... 26 Table 6: Cropping Pattern vis a vis Households .......................................................................................... 28 Table 7: Seasonality of Crops ...................................................................................................................... 29 Table 8: