A co-operative response to a crisis which has brought destitution and hunger to the tea growers of Darjeeling has been given an investment boost – from another co-op.
It’s welcome news for the region, in the mountains of West Bengal, northern India. Darjeeling is world-renowned for its quality teas but in recent years its plantations, which have sustained families for generations, have been going bust.
The situation has been repeated across the state of West Bengal, which has struggled against increased competition for the global market from other tea-growing countries, leaving estates to go derelict. Communities have been left with no drinking water and suffering social unrest, with media reports of death from starvation and attacks on owners.
By law, India’s tea estate owners must support their employees by providing basic necessities such as housing, social care and fair wages. But they often abandon a plantation if it fails, leaving the farmers and their families with nothing.
In some cases, the government has stepped in to run these estates. Workers have also tried to form co-ops, but have faced legal hurdles in terms of land leasing and obtaining loans.
In Darjeeling, prospects are now brighter, with investment co-op Oikocredit stepping in to help. It has partnered with Ambootia Tea Group, a co-operative family business which acquires struggling tea estates, to give farmers a secure future, using environmentally sustainable farming methods.
This offers a crucial lifeline to the region, whose first commercial plantations were established in 1852. The Darjeeling tourism board estimates that around 200,000 people are wholly dependent on these estates. At its height, the area had more than 100 tea estates, but this number has fallen to around 87.
Ambootia brings an innovative solution, applying organic and biodynamic farming techniques and offering its employees secure livelihoods, fair wages and help with housing, food, clothing, education and medical treatment. And Oikocredit’s finance has helped it acquire several derelict estates where thousands of workers had been left in desperate conditions.
The work is making an important difference. Over the past 12 years, Ambootia – or the Darjeeling Organic Tea Estates Private Ltd – has acquired 12 of the 87 Darjeeling plantations and has become internationally renowned for its high-quality teas.
Crucially, it is also making fair wages a priority, setting an important example in a country where more than an estimated 18 million people are paid unfairly, and offering other benefits to help but communities onto a more sustainable footing.
For instance, Ambootia gives its staff housing, food, fuel, footwear, protective clothing, winter blankets and basic, free medical treatment. Free milk is distributed through the infant nutrition programme, and social security includes provident and pension funds and support for dependants.
And to help the next generation, the co-op is providing free primary education so that children can go to school instead of working alongside their parents as child labourers.
Most of the tea picking on the Ambootia estates is undertaken by women and the company says it places a strong emphasis on enhancing female economic empowerment.
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Oikocredit has highlighted the example of one of the women working for Ambootia, Priti Thapa, who cares for a household of six people alongside her husband, a driver.
Priti picks tea for eight hours each day – minus lunch and tea breaks – while her daughter attends the school on the estate. Priti also takes advantage of an income augmentation programme, which provides her with the tools and resources to make additional income from growing vegetables and breeding cows, pigs and chickens.
Oikocredit said it chose to become an equity investor in Ambootia because of its strong blend of a solid business plan and commitment to employee welfare. It said the co-op model was a valuable means to give farmers a stronger position in the supply chain, through collective bargaining.
Thos Gieskes, managing director of Oikocredit, said: “There is a whole value chain between the farmgate and the supermarket. One of the fundamental solutions to ensure that farmers get a better reward for their product is to connect them better into that value chain, so they can capture more of the value that is created in that value chain.
“Because they tend to be small, they just get marginalised by the next step above them in the chain. There are people in those value chains who make a lot of money.
“That’s why co-operatives are so important in the agriculture space – they allow farmers to unite and get a better bargaining position in the chain. What Oikocredit wants to do in general, it is to work with people at the bottom of the pyramid – to give them the opportunity to rise out of poverty in a sustainable way.”
Bharat Khemka, vice-president and deputy chief financial officer of Ambootia, said: “We have used [Oikocredit’s] funds to acquire struggling, abandoned and derelict estates. Thousands of people were in a precarious situation. Their basic wages weren’t being paid, their homes were dilapidated and they were unable to lead normal lives. With Oikocredit’s help, we’ve bought three estates and are working on turning them into profitable businesses.’’
In September 2015, the United Nations created a universal set of goals aimed at addressing critical global challenges by 2030. These goals, known as the sustainable development goals (SDGs), are focused on tackling poverty, inequality and injustice, hunger, climate change and many other issues facing the world today. Achieving the SDGs is estimated to cost around $1.4tn (£920bn) each year for the next 13 years, and governments alone will not be able to foot the bill.
“The impact of Oikocredit on many of the 65,000 people who live on our company’s tea estates is tremendous. As well as social benefits, there are ecological improvements because we follow a sustainable model of farming,” says Sanjay Bansal, chairman and managing director of Ambootia.
