Companies ink fair trade deals with farmers

SOCIAL ENTERPRISE

Global trade talks under the World Trade Organisation may have collapsed once again, but many big global retail chains as well as local facilitating producer companies in India are signing agreements with cotton and basmati rice farmers on ethical business practices under the Fair Trade Labelling Organisation (FLO).

FLO International is a non-profit, multi-stakeholder association involving 23 organisations, traders and external experts. The association sets standards for fair trade and supports fair trade certified producers by providing them market opportunities. Farmer groups which tie-up with producer companies and retailers under FLO norms get the FLO equivalent of a minimum support price .

Indian cotton and basmati companies are in the forefront of the fair trade movement in India. A producer company, Agrocell, has tied up with Indian cotton farmers groups for 22,000 acres. Agrocell Managing Director Hansmukh Patel says the farmers can opt for buyers suggested by Agrocell or sell to the highest bidder.

Patel adds: “Our role ends with ensuring that farmers get an assured price from retailers like Marks & Spencer and Gap. We also provide support in ensuring irrigation and a fair trade premium, which takes care of education and health needs of the land-owning farmers as well as the wage workers.”

FLO conditions stipulate that there will be no genetically modified crop, no child labour, and workers must get minimum wages.

In Indore, Madhya Pradesh, a company , Pratibha Syntex, runs the Vasudha project for cotton farmers under these norms. In Hyderabad, Chetna Organic is getting farmers certified under fair trade norms for international buyers, mostly from the EU.

Shell Foundation has been promoting the fair trade projects of Agrocell for the last five years. Its Country Head Anuradha Bhavnani says that fair trade is a result of a thinking that big retailers can contribute to poverty alleviation of farmers.

Retailers who have been demanding produce through fair trade norms are Gap, Mark & Spencer and C & A, says Bhavnani.