1 Introduction

Recognising the threat to a number of species of medicinal plants, the Uttarakhand government has formulated a series of policies for their conservation. These policies have two main components: regulation of the collection of medicinal plants from the wild to protect biodiversity, and promotion of cultivation to meet demand and provide farmers with new income opportunities (Government of Uttaranchal 2002). The policy to promote the domestication and cultivation of medicinal plants has met with very limited success. In the following paragraphs we review this policy and examine the constraints faced in its implementation. We then describe a project set-up in the Uttarkashi district to support the cultivation by small farmers, and remove many of these constraints through collaboration between the public and private sectors. Third, we analyse the socio-economic conditions of the farmers involved in the project and examine how the cultivation of medicinal plants fits into their farming systems and livelihood strategies. Finally, we discuss the insights, lessons and policy recommendations derived from the project.

2 Policies and Constraints

The cultivation of medicinal plants is considered to be of great importance for the safeguarding of biodiversity and contribution to rural livelihoods in Uttarakhand. It is hoped that cultivated medicinal plant material will provide an alternative source of supply to the market, and thereby reduce the need for collection of these plants from the wild. Cultivation will also provide an additional source of income for the state’s rural poor. This is especially important as 80% of Uttarakhand’s working population depends on agriculture, but poor land quality and the small size of landholdings lead to low rural incomes. For example, half of the farming households own less than two acres, and only 5% own more than five acres (Maikhuri, Rao and Semwal 2001). Farming is mainly subsistence-oriented and market access is

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restricted due to poor roads and communication infrastructure. As returns from traditional crops decline, the cultivation of medicinal plants is seen by many as an important source of farm income. Compared to bulky and perishable agricultural commodities, medicinal plants have a higher value per unit volume, which makes them particularly attractive for remote, mountainous areas with transport limitations.

The state government’s enabling policies include (a) popularising the idea of cultivation of medicinal plants among farmers;

0.10 acre. As the expected benefits of growing medicinal plants on a small area are limited, the farmers lack the motivation to look after the plantation.

(d) Supply chain constraints: The informal nature of the m edicinal plant sector is one of the central problems faced by farmers wishing to cultivate these plants. The domestic industry sources the material through a myriad of wholesalers and traders, many of whom belong to the informal sector. The companies choose their suppliers merely on the basis of price and attach no value to traceability or sustainability within their procurement policies. Furthermore, the low cost of collection from the wild, both legal and illegal, puts a downward pressure on market prices. Moreover, in many wholesale markets there are only a handful of traders, and evidence suggests that they collude to fix low prices (Virdi 2004). The farmers feel that the prices do not compensate for the difficulties and uncertainties of cultivation.

Considering these constraints, it is clear that the cultivation of medicinal plants requires a multifaceted approach. The following section of the paper describes how this is being attempted in a project to promote the cultivation and export of kutki (picrorhiza kurrooa) by small-scale farmers in Uttarkashi district. Through close collaboration between actors from public, private and civil society sectors, the farmers are being provided with a secure market outlet, attractive prices, and technical and regulatory support to establish a sustainable supply chain.

3 Sustainable Supply Chain

Kutki is a high altitude perennial herb that grows between 2,500 and 4,600 metres. Its many medicinal uses include treatment of influenza, diarrhoea, jaundice and cirrhosis. It is also considered to be a valuable bitter tonic. The selection of kutki as a pilot crop was made for a number of reasons. First, it can be cultivated on poor quality land where other crops do not grow. This would enable farmers to increase their income without unduly affecting their existing crops. Second, there is a significant market demand for kutki from producers of both allopathic and traditional medicine. India is the main supplier on the global market, exporting around 100 MT/year, while domestic consumption is around 300 MT/year. Finally, kutki is listed in CITES-Appendix II (Convention on International Trade in Endangered Species of Wild Fauna and Flora) and the Indian Red List of endangered species. This puts serious restrictions on the trade of non-cultivated and non-traceable kutki obtained from the wild. It is therefore likely that fully traceable, officially registered, cultivated kutki would fetch a large price premium, especially in developed countries where restrictions on the trade of listed species are strictly adhered to. In fact, it is largely this factor that has attracted a Dutch firm to support the project and commit itself to purchase the kutki at a premium price for a minimum of five years.

The project involves 50 farmers in two villages, Sukhi Top and Jaspur, located at an altitude of 2,700 metres, at about 200 km distance from the state capital Dehradun (an 11-hour drive along the Ganges river). Sukhi Top, located on the main road, has 136 inhabitants in 23 households. Jaspur has 77 inhabitants in 14 households, and is located at a distance of one kilometre from the main road. The socio-economic profile of the villagers and their livelihood strategies are examined later in the paper.

The project involves a number of actors. These include the farmers

– represented by two growers’ groups – the buyer Ayurveda Health (The Netherlands); KIT Royal Tropical Institute (Amsterdam) and Centre for Sustainable Development (Mussoorie). Ayurvedic

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Table 1: Size of Landholding (% of households)

able. Ayurveda Health is particularly inter-Village Up to 1 Acre 1.1 to 2.5 Acre More than 2.5 Acre and aged. A significant number of families ested in procuring CITES-listed medicinal Jaspur 14 50 36 were also engaged in trade with Tibet, sellplants that are cultivated and traded in a Sukhi 13 61 26 ing grain, clothes and metal goods in return

Total 14 56 30

fully traceable supply chain. This is reflected for salt and wool.

Source: Village survey by the authors in 2006.

4 Five Decades of Change

The inhabitants of Jaspur and Sukhi Top have gone through profound changes in their livelihood situation during the last five decades. Until the late 1960s a majority of the villagers were agro-pastoralists. While the men looked after livestock, which

was the main source of income, women farmed to supplement their household incomes. During the summer men would pasture their goats and sheep on the meadows and in the forests, and in the winter migrate to grazing areas in the foothills. The women stayed in the villages for the most part of the year, cultivating food crops and taking care of the children

The trade with Tibet ceased after the 1962 Indo-China war. Moreover, the forest department began to impose serious restrictions on grazing of livestock, due to concerns about rapid deforestation in the mountain areas. Access to forest pastures could still be obtained through permits, but the number of permits was restricted. This forced the villagers to look for new sources of income beyond animal husbandry.

Agriculture and horticulture are increasingly playing a major role in bridging the income gap caused by the declining importance of animal husbandry and trade. As is common in mountainous areas, farming is carried out on small terraced fields, most of which are scattered over large distances. The majority of the villagers are small landholders. The average landholding is

2.3 acres; only 30% of the households own more than 2.5 acres (Table 1). The area has no irrigation facilities, and rain-fed farming is practised by all farmers.

Agriculture accounts for 38% of total income in the villages (Table 2). Farming is particularly important in Jaspur where it accounts for half of the total household income. This is followed by horticulture (apple orchards) which provides 31% of the total

Table 2: Importance of Income Sources (% of Average Household Income)

Village Agriculture Horticulture Wages Business Livestock Other

Jaspur 51 10 20 11 8

Sukhi Top 33 41 13 10 3

Total 38 31 15 10 5

Source: Village survey by the authors in 2006. Table 3:Importance of Crops (% of Cultivated Land)

Village Apple Potato Rajma Chaulai Vegetables for Market Medicinal Plants

Jaspur 21 34 28 13 1

Sukhi 44 30 15 10 0

Total 36 32 20 11 1

Source: Village survey by the authors in 2006. Table 4: Importance of Cash Crops (% of total sales)

Village Potato Apple Rajma Chaulai Vegetables Medicinal Plants

Jaspur 45 31 9

14 2

Sukhi 30 13 0

56 1

Total 34 18 2

45 1

Source: Village survey by the authors in 2006.

income. The third most important source of income is “daily wages” earned by villagers by working for each other or for public agencies such as the forest and public works departments. Livestock accounts for only 5% of the total income.

Agriculture in both villages is focused on cash crops, notably potatoes, rajma (red kidney beans), chaulai (amaranthus) and apple (Tables 3 and 4). Grains and other staple food crops are purchased from markets in the foothills, especially in Rishikesh.

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Remarkably, the villagers continue to maintain strong links with the markets and depend on them for most of their food supplies and other needs. This is clearly a continuation of the times when the inhabitants were largely traders and pastoralists and bought their food and other provisions from the markets in the plain. While the village economy changed radically in a few decades, substituting farm production for trade and livestock, the farming system did not go through

5 The Niche for Kutki

The income/expenditure data clearly show that the villagers need to increase their income to balance the household budget. At present one of the main ways this is done is through the collection of medicinal plants from the wild. As it is illegal, this source of income is not disclosed by villagers and is not included in our survey. However, informal conversations with them suggest that at least one-quarter of the households, notably the poorest, are engaged in the collection of medicinal plants from the wild. Informants say that during one harvest season an experienced collector can gather up to 150 kg of kutki and five kg of atish. Considering that local traders pay about Rs 150 and Rs 2,000 per kg of kutki and atish respectively, the collectors can earn a sizeable income from the collection of medicinal plants. This represents about one-quarter of the total income of the poorer households in these villages.

It is hoped that the cultivation of medicinal plants will provide villagers with a more sustainable way to bridge the income gap. As kutki is being cultivated either on fallow land or inter-cropped with apple, the income from it is seen by farmers as an addition to their current farm income. For this reason they are prepared to accept relatively low returns from kutki. According to our study, farmers expect an average income of Rs 19,094/acre, which is equivalent to 68% of their income from potatoes or 16% of their earnings from one acre of apple. This suggests that if the cultivation of kutki as an intercrop or on neglected land is successful, farmers will accept it in spite of comparatively low returns. It is, however, important to note that given the complex and comparatively limited market for herbs, the cultivation of kutki cannot be expected to become a large-scale activity and compete with other crops. Furthermore, as income from apple increases, the farmers’ interest in cultivating kutki is likely to decline.

6 Performance of the Project

The project started in 2002 with preliminary research by KIT and CSD and initial contacts with the Dutch buyer. In 2005 the farmers were selected, buying contracts between the farmers groups, Himalayan Organics and Ayurvedic Health were signed, and kutki was planted. It was expected that the crop would be harvested during 2007, but for a number of reasons the first harvest was delayed. Only after the technical and commercial feasibility of kutki cultivation is fully established will the project be up-scaled to include more farmers and be diversified to include more products. The main reason for the delay in obtaining the first harvest is the high mortality suffered during the first two years of the project. The following reasons have been responsible for this:

– Poor quality of planting material. In spite of the state government’s claim to the contrary, it is difficult to obtain good quality planting material in Uttarakhand. The project procured kutki cuttings from two sources: a research institute, reputed to have expertise in the propagation and cultivation of kutki, and the state forest department, which has a number of nurseries set up

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to propagate planting material of important species of medicinal plants. The planting material supplied by both these sources was of poor quality and led to high mortality during the first year. This caused a certain degree of disappointment and loss of motivation among the farmers.

Learning from the experience, a special effort has been made to procure better quality planting material. This has led to a considerable decline in the mortality rate, leading to increased motivation among the farmers. Furthermore, pipes have been provided to farmers (at 50% of the cost) to irrigate the kutki fields. This is expected to reduce mortality further.

It is expected that with the benefit of experience gained during the last three years, the performance of the project will improve considerably.

7 Conclusions

The study shows that the cultivation of medicinal plants can play an important role in the livelihood strategies of the villagers in Jaspur and Sukhi Top (and many other high altitude villages in Uttarakhand). As all households in the area have farm land, the cultivation of kutki can benefit most households in these villages. Further, as many of the villagers are engaged in illegal extraction of kutki, its cultivation can contribute directly to the conservation of biodiversity. At the same time, it is clear that the success of cultivation will largely depend on the returns from kutki, compared to other crops. The situation is complex, as the comparative returns from various crops can change over time, and alter the incentives. In fact, this is already happening in these villages as the income from apple orchards is increasing fast. However, for poor farmers who do not have the option of increasing their income through apple orchards the cultivation of kutki and other medicinal plants can still be an effective strategy. Our data confirms that cultivation of medicinal plants is a viable option to improve the livelihoods of poor farmers and thereby curtail the incentives to collect from the wild.

It must, however, be pointed out that, compared to other agricultural products, the global market for most medicinal plants (including kutki) is small and could be saturated by the production of a small number of farmers. The potential of the cultivation of kutki and other medicinal plants as a widespread source of livelihood may therefore not be as high as usually assumed.

The study shows that, in order to be successful, efforts to cultivate medicinal plants depend on a number of factors. The most important of these are:

(1) Choice of medicinal plants with a large market potential: It is important to promote the cultivation of those medicinal plants

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which can receive a premium in the market. The species which are listed in CITES are an obvious choice for this reason. As things stand, by and large it is the consumers in developed countries who are prepared to pay a premium for products which are environmentally friendly and not associated with depletion of scarce bio-resources from the wild. At the same time these markets require documented traceability, i e, information about the product’s origin and the conditions under which it is produced. Efforts to support the cultivation of medicinal plants should take these requirements into account from the outset. At present these conditions do not apply to the Indian domestic market. Nevertheless, considering a rapidly rising purchasing power and increasing concerns for health and sustainability, efforts should be made to identify consumer segments in the domestic market with a demand for traceable, certified products.

(2) Choice of a suitable area with favourable agro-ecological conditions and relatively low levels of economic development: For successful domestication medicinal plants require specific microclimatic and ecological conditions, which are often difficult to duplicate in farmers’ fields. Failure to create these conditions makes it difficult for farmers to cultivate medicinal plants. Research needs to be carried out to understand and replicate favourable agro-ecological conditions conducive to the cultivation of important medicinal plants.

As medicinal plants compete with other crops (and other sources of income), their cultivation is more likely to be successful in areas where incomes are low. As economic activities and incomes can change over a period of time, it is important that a long-term and dynamic view of economic activities is taken when an area is chosen for the promotion of medicinal plants. The importance of this is clearly shown by the emergence of apple orchards as an important source of income in the villages under consideration. This has lowered the attraction of kutki as a source of income.

The role of the partnership facilitator is often neglected in public policies. There are few policy instruments that support the work of the facilitator in selecting appropriate business partners, bringing them together in a business agreement and assisting them in the pilot stage of chain development (which in our case has taken five years). Rather than providing production subsidies, which distort the market, government policy should focus on supporting the pilot stages of chain development, so that private parties can find each other and set up viable business ventures. Such an approach will be likely to reconcile business interests with environmental protection and pro-poor growth.

References

Alam, Ghayur and John Belt (2004): “Medicinal Plants Sector in Uttaranchal: Findings of a Recent Study” in Ghayur Alam and John Belt (ed.), Searching Synergy: Stakeholder Views on Developing a Sustainable Medicinal Plant Chain in Uttaranchal – India, Bulletin, 359 (Amsterdam, The Netherlands: KIT Publishers).

Government of India (2000): “Report of the Task Force on Conservation and Sustainable Use of Medicinal Plants” (New Delhi: Planning Commission).

The Environmentalist, 21: 23-39.

Virdi, Malika (2004): “Wild Plants as Resource: New Opportunities or Last Resort? Some Dimensions of the Collection, Cultivation and Trade of Medicinal Plants in the Gori Basin” in G Alam and J Belt (ed.), Searching Synergy: Stakeholder Views on Developing a Sustainable Medicinal Plant Chain in Uttaranchal, India, KIT Bulletin 359 (Amsterdam, The Netherlands: KIT Publishers).

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