Ahead of FDI in retail, the wholesale experience
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It started with 65 farmers in Malerkotla in Punjab in December 2008. Now the Direct Farm Programme initiated by Bharti Walmart for Best Price Modern Wholesale involves 6,400 small and marginal farmers across Punjab, UP, Delhi/NCR, Haryana, Karnataka, Maharashtra and Himachal Pradesh, who supply up to 15 locally grown vegetables from lauki to capsicum, baby corn and seedless cucumber.
As Punjab Chief Minister Parkash Singh Badal and his son and deputy Sukhbir Badal speak in two voices over FDI in multi-brand retail, farmers supplying to Bharti Walmart have had a bittersweet wholesale experience so far.
In Mushkabad village of Ludhiana, Davinder Singh's farm boasts nethouses, low-tunnel technology and drip irrigation. Put up with the help of Punjab Agricultural University, the nethouses ensure better quality produce and use of less pesticide. The investment is worth the returns from big buyers such as Bharti Walmart.
Davinder had a few years ago started Quality Veg Produce, with about 50 progressive farmers from Ludhiana, Patiala, Jalandhar and Fatehgarh Sahib, to promote use of technology, negotiate prices with wholesale and retail chains and explore potential markets, both domestic and overseas, for their vegetables that are certified safe (by a Jalandhar agency) under norms for fertlisers use and pesticide residue.
Davinder, 42, says Walmart quotes prices usually 10 per cent higher than mandis do but there is uncertainty on the size of orders. "A bulk order from Walmart could range between half a tonne to two tonnes, depending on demand. Since the orders are unpredictable, we cannot fully rely on them and sell the remaining produce at mandis, at times at low rates," he says. "The main gain for farmers has been in terms of agronomic practices and technology. Walmart has set certain standards; there is an additional bonus for delivering quality produce. We are also provided training by their field agronomists. FDI in multi-brand retail will bring post-harvest facilities and cold chains and cut down on wastage."