Enhance the impact of sustainability standards on smallholder cotton farmers in Maharashtra

Executive summary

Agriculture is an important economic activity in Maharashtra, with half of the State’s population depending on it for livelihood. The State is the second largest producer of cotton in the country, producing over 20% of the country’s cotton. Cotton commands the largest net sown area under a single crop. Vidarbha and Marathwada are the main cotton producing regions in the State. The State also accounts for one the largest numbers of smallholder farmers with over 14.7 million operational holdings. Thus, a substantial number of smallholder farmers are involved in cotton production.

However, there are concerns around environmental and social practices in the cotton value chain. This includes low yields (due to predominantly rainfed nature of agriculture), and frequent pest infestation. Overuse of chemicals (as defence against pests, and fertilisers) has led to concerns over degradation of soil and water in the State, as well as increasing concerns regarding farmer health. In 2017, over 20 cotton farmers in the district of Yavatmal and over 40 farmers in the Vidarbha region died due to pesticides related poisoning. Further, reports highlight important areas such as labour practices, value chain gaps such as market linkages, quality and contamination of cotton, market volatility, as important areas of concern in the cotton value chain.

Several initiatives have been taken over the past few years to enhance sustainable practices in cotton value chain. The Central and State governments have launched various policies and programs in the agriculture sector to promote production and productivity with higher soil and water efficiency. Maharashtra has also taken forward-looking initiatives and has identified sustainable climate- resilient agriculture as an important paradigm for development. Some of the pertinent Central and State schemes include Soil Health Management under National Mission for Sustainable Agriculture, Paramparagat Krishi Vikas Yojana, Pradhan Mantri Krishi Sinchayi Yojana, Rainfed Area Development, National Initiative for Climate Resilient Agriculture, Integrated Watershed Management Program, Jalyukt Shivar Abhiyan, and Project on Climate Resilient Agriculture. Some of these schemes such as incentives for drip irrigation have seen fair bit of success in the State. The central government has also tabled a new Pesticide Management Bill 2020 in the cabinet to regulate heavy use of pesticides in agriculture. In addition to these policies and programs, Voluntary Standards such as the Better Cotton Initiative promote the cultivation of sustainable cotton in the State. The Standards ecosystem is also evolving. Most Standards focus on sustainable production, to enhance environmental outcomes and cost savins to farmers. Practices promulgated by these Standards work towards addressing social (especially labour/ decent work practices) and environmental aspects (soil conservation, water use efficiency, use of chemicals and pesticides) at the farm level. New Standards are also being experimented that expand the coverage to include animal welfare practices, traceability and supply chain issues, marketing linkages, etc. Further, other value chain issues beyond farm such as handling, processing, contamination and integrity of cotton also needs to be addressed.

Since the objectives of Voluntary Standards are aligned with SDGs, globally it is accepted that they also contribute to countries’ achievement of SDGs. This also aligns with India’s commitment to the United Nations Sustainable Development Goals (UN SDGs) and international treaties. For instance, the country launched Decent Work Country Programme (2018-22) in collaboration with the International Labor Organisation ILO), which lays down a roadmap for improved working conditions at organised and unorganised employment, and calls for equal opportunities for men and women, among other things. The guidelines apply to all sectors of the economy, including services, manufacturing, and agriculture. Further NITI Aayog, India’s think tank, maps India’s goals to SDGs by focussing on 62 Priority Indicators, which include percentage of area under forest cover, change in extent of water bodies, groundwater withdrawal against availability, nitrogen fertiliser usage, etc.

Present trends in the State show early successes in expansion of these Standards, with almost 14% of the cultivated cotton area under BCI. The number of farmers converted to BCI tripled in the last five years to over 4.4 Lakh farmers (a CAGR of 26% over the last 5 years). Organic cotton is also produced, however, penetration seems to be low as most farmers grow Bt cotton (Organic cotton requires non-GMO seeds). Challenges remain in terms of market access, price premium for identity cotton, and capacities at local levels (smallholder farmers, public extension functionaries, implementation agencies), as also availability of certain inputs like better seeds. Quality assurance is also an important area to be addressed. Cotton from other countries such as Turkey, Africa, etc. seem to be more acceptable to private players and commands premium due to its consistent quality assurance, as compared to domestic cotton.

Studies show that there are significant environmental benefits and economic gains that emanates out of adopting the practices promoted under the Standards. This include improved yield, reduction in chemical fertilisers usage, reduction in application of toxic pesticides, reduction in GHG emissions, and resultant reduction in environmental risks. This is also corroborated by feedback from farmers practicing BCI and organic practices, who report improvement in soil quality, economic benefits (cost savings due to reduced use of chemicals- fertilizers and pesticides) and better health outcomes for them. It is therefore noted that substantial economic, environmental and health benefits could be achieved by the State (for farmers as well as environmental benefits), by scaling up these Standards State-wide.

Government has an important role in supporting this ecosystem for expansion and adoption of sustainable practices and spreading the benefits equitably. Government could therefore consider enabling State-wide adoption of these Standards by farmers. In addition, government can help scale up the market, and develop infrastructure for the future, to address the missing links. It is desirable to invest in certain areas like capacity building of farmers and public sector extension network, access to eco-friendly inputs (non- GMO seeds, approved chemicals) to reduce the use of chemicals (pesticides and fertilisers), upgrade testing and R&D infrastructure and mechanisms, and establishing the missing value chain linkages especially on the market and logistics aspects. Private sector is an important part of the ecosystem that could also be leveraged more effectively.

In this context, there are various options that may be considered (figure below). Each of these options have some pros and cons in terms of market responsiveness, ease of implementation, cost economics, monitoring mechanisms, and coordination efforts required from both government and industry. There are examples from other States and countries who have adopted similar strategies for the sector. Some of these include Government of Andhra Pradesh’s ZBNF program, Australia’s myBMP initiative, The Egyptian Cotton Project, Mozambique’s mainstreaming of BCI, and US Cotton Trust Protocol. Government of Maharashtra could adopt either of these to further its vision of prospering farmers and a vibrant cotton sector. This would entail looking at the state of economy, level of investments, and project horizon. The government could consider channelizing funds through its ongoing schemes into the areas requiring strengthening and support.

Option 1: Market led model, with government as enabler

  • Incentives for expansion to remote farmers
  • Share details regarding government scheme and subsidies, funds to be released on priority basis
  • Support funding for farmer registration/ certification, and establishing of farmer entities (FPOs)
  • Scale up the market by procuring sustainable cotton products
  • Use of private sector benchmarks and inputs for policy decisions
  • Strengthen testing infrastructure for quality assurance


Option 2: Collaborative approach with government-private partnership

  • Incentives for private sector players to implement/ expand standards coverage
  • Training to government extension functionaries on Standards
  • Undertake pilot projects with private standards
  • Funding support for farmer training
  • Funding for testing and quality assurance, to be implemented by private sector
  • Enhance R&D investments
  • Use of private sector benchmarks and inputs for policy decisions
  • Enable digital interventions


Option 3: Government driven dedicated program

  • A dedicated program for farmer capacity building, testing and quality assurance, and marketing
  • Pilot programs- organic districts, private certification
  • Dovetailing public programs; involve non-government/ private sector partners
  • Setting up procurement mechanism- farm gate to market/ Setting up dedicated mandis
  • Branding strategy to manage perception on quality, and for better marketing
  • Provide marketing support and enable digital interventions

As a way forward, government could have consultations with private sector and Standards organisations for collaboration on training and certification aspects. While Standards could bring in their experience and expertise for developing implementation partners, undertaking capacity building, demonstration plots and conducting trainings, project management, etc., government could undertake joint pilots and help plug the gaps in testing and market networks. Government could dovetail its programs to provide the necessary inputs, subsidies and leverage private sector expertise. As next steps, government could initiate focussed industry consultations, to arrive at a detailed strategy and time bound action plan.


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