Trading of nationalised produces was done as a royalty system in one form or other from 1964 till 1984. Due to problem in the system and in order to give more benefits to forest dwellers in collection and trade of Tendu Leaves, MP State Minor Forest Produce (Trading & Development) Co-operative Federation Limited was formed in 1984. From 1990, the trade of Harra and Sal Seed was started through this arrangement. In addition, collection of Kullu and Salai gums through societies was started in 1996-97 and that of Dhawra/ Khair/ Babool was started in 1998-99.

The federation operated in a limited way through PACS and LAMPS till 1989, when a three tier Co-operative structure was designed and implemented to deal with nationalised produces by obliterating role of middlemen in trade. MP State Minor Forest Produce Federation was placed at apex level of this structure. At primary level, Forest Produce Co-operative Societies (PCS) were constituted. At intermediary level, District Forest Produce Co-operative Unions were formed. 1947 PCS and 44-district unions were formed in 1989. Later district unions were organised as per territorial divisional units and there were 83 district unions prior to division of the state. At present, MP has 1066 PCS and 58 district unions. The state after bifurcation has nearly 15 lakh members and 18000 phads become operational during TL season. Total staff strength in the federation is 150.

Primary co-operative societies are formed with the membership of actual pluckers. The societies have elected members and an elected chairman. A management committee comprising of chairman, manager and other members manage its day-to-day affairs. First election to the primary co-operative societies was done in 1995 and the next was done towards the end of 2001. Prior to elections in district unions, the collector used to be the chairman and territorial DFO ex-officio managing director of district union. While the later still holds the post, the unions now have elected chairmen. Conservators at circle level are designated as General Manager in the federation.

As regards to administration of collection, each of the Phad has a phad Munshi and each PCS a manager. The district union has minimal staff (2 to 3), most of the fieldwork being done by the regular staff of forest department. The federation does not have any office except at central level. The district union office is attached with the territorial forest division office, as DFO is the MD of the Union. The federation has a separate office in the state capital. In total the state federation has about 150 staff on its rolls. All the federation staffs are on deputation from FD.

For expenses, PCS received a commission @ Rs. 10 per SB, but total amount was not to be less then 3% of sale amount. District unions were paid @ Rs. 3 per SB that was not to be less then 1% of total sale received. Federation received a commission of 2% on sale amount received by sale of leaves in the whole state. Later the government reduced commission of state federation and district union to Rs. 1 per annum undertaking to bear the expenses of federation and district unions. In realty this was done so that government could take away bulk of the net receipts as royalty. However things again changed after enactment of PESA, when government had to plough back all the receipts to people (described later).

The state federation has now been made the nodal agency to add value to bamboo. It has already taken steps to manufacture incense sticks out of bamboo. The federation now also trades non-nationalised produces in a limited way. In this case, proposals are sought from willing PCS and loans advanced to deserving societies at 4% per annum interest for working capital. Though federation and district union extend all possible help in sale of produces procured, it does not guarantee anything and does not bear any risk. The federation is marketing the perishable products like Aonla and Neem seed by advance sale through tenders. Other products are sold after collection but their marketing is generally done in advance through MoUs with buyers. A retail outlet "Sanjeevani Ayurved" has been opened in Bhopal for marketing of medicinal products processed and packaged by the socities. There are plans to open such outlets in different cities of the state and the country.

It is also in this context that a task force was established in 1995 for promotion of medicinal and aromatic plants in the state looking at potential of the state. The belief is that medicinal plant conservation and sustainable utilisation programmes, if designed properly, can ensure increased access to health resources to rural poor, and create jobs and sustainable livelihoods. It has made efforts towards popularising plantation of medicinal plants among rural population and marketing them. Some of the major activities of the board have been to

• Buyers’ sellers meet bringing together drug manufacturers and primary co-operative societies to share information and concerns.
• Training villagers and members of the PCS in cultivation, collection and primary processing of the medicinal and aromatic plants in collaboration with CEDMAP/ NGOs and JFM committees.
• Commercial cultivation of medicinal plants in Forest lands
• Establishing multiple unit primary processing plants in select villages to act as demonstration units.
• Exhibitions in different cities of MP and Delhi to popularise traditional healing methods and use of medicinal plants. During an exhibition ‘Van Mela’ in Bhopal, it opened an equivalent of Out Patients Department by some of Local Vaidyas ‘traditional healers’.
• Implementation of centrally sponsored scheme for conservation and development of NTFP including medicinal plants.
• Council of growers and processors of medicinal and aromatic plants
• The federation in due course of time has taken upon itself the responsibility to supply raw herbs in bulk quantities, organically cultivated medicinal plants and semi-processed products as per demand
  

Sale

All produces were till recently sold on auction/tender after collection. However, there has been a shift towards advance tendering in all produces except for Tendu leaf. This is being done as per 73rd amendment or PESA according to the official position so that primary gatherers get maximum benefit. While the federation and district union play the facilitator's role, the trader collects the produce from primary co-operative societies. The advantage is that rates of sale will be known in advance and accordingly benefits passed on to collectors directly; there is also less scope for corruption and lesser expenses on storage. Administrative expenses of the federation will reduce significantly in the process.

The federation feels that following increase in prices have been possible primarily due to advance tendering system. However, there has been reduction of prices in Harra and Gums post 2000.

Source: MPMFP Federation Website

The federation makes huge profit from TL operations. The federation at the same time claims that it usually incurs losses in other produces. However figures suggest that it also makes profit in all other produces, though not in the scale as in case of TL. The margins are definitely less, and have become uncertain in recent periods (Harra is a case in point). Could this also be a reason for advance tendering?

There are allegations that federation is not procuring Harra in most areas. It also does not give much importance to procurement of Sal seed. In the case of former, reason given is that the federation is helpless as the market is dull and it is not able to clear the previous years’ stock.

There is a provision for grievance redressal, in which case collectors and traders can formally lodge complaints from level of Ranger to PCCF.

Incentive Wages :

One of the major changes effected in the undivided state in response to 73rd amendment (PESA) have been in distribution of incentive wages. Since the provision bestows ownership of NTFP to Gram Sabhas, it was decided that all net receipt from operations of TL would be distributed to primary co-operative societies. Societies in turn would distribute the profit as follows

• 50% - as incentive wages to the members directly
• 20% - to be spent towards development of forests and NTFP resources. The fund for PPA comes from this 20%.
• 30% - ordinarily to be spent in basic infrastructure development of respective area and can be given to the members directly if the society so wishes. It has been decided to construct godowns in the leaf growing areas so as to increase storage capacity that in turn would enhance collection of the leaves thereby increasing income to pluckers. The federation has in fact constructed a number of godowns in TL producing areas out of allocated 30% net income.

The incentive wages for the year 1998 was distributed in May 2000 with much fanfare with prominent state and central congress leaders distributing it in different districts. The distribution of incentive wages for 1999 season has just been done.