The Kendu Leaf Trade: Problems & Prospects in Orissa - Vasundhara

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The bidi market basically runs on credit. However, the manufacturers themselves do not prefer to take loans to stabilize their financial strength because they apprehend that owing to the nature of the bidi market, it might not be possible for them to repay the loan. Hence, they rather prefer to decrease the production or manipulate things. In Orissa, the Gujuratis dominated the bidi manufacturing sector for decades, and the credit of establishing a name & fame for Orissa leaves basically goes to them. They follow what is known as ‘behavioural accounting system’ to best suit their purpose. Under this system, the profit is calculated not on the basis of the results of the past financial year, but on the basis of current achievements. Besides threats from external factors like gutka, the legally produced bidi is facing a serious internal threat from the growing production & sale of unauthorisedly produced bidi particularly because the latter is cheaper and because of its lower price can still offer an attraction to the bidi addicted mass. While the legally produced brand has a sale price of Rs.150 to Rs.170 per 1000 sticks, the unauthorized/duplicate bidi, which can still have the same brand name as the authorized one, can sale at Rs.100 to Rs.120 for the same quantity. Such a substantial gain on the duplicate brand offers an attraction to the addicted customer, not to mention the shop-keepers who sale the same. It is apprehended that the duplicate bidi shares about 25% of the total production of bidi in the country. The contradictory situation is reflected in an assessment that while about 50 years ago the approx. daily production of bidi in western Orissa was around 60 lakhs, the current production(daily) is more than 1 crore. What is important to note is that while 50 years ago about 50-60% of the bidi produced in the state used to be consumed within the state itself, currently the consumption is about 10% only, rest of the production being sold outside the state(personal communication. M.C.Patel). Exact figures of the production, demand, and sale of bidi in Orissa are not available. One indicative estimate by M.C.Patel, himself a bidi manufacturer and president of the bidi manufacturer’s association in the state, suggests that the daily sale of bidi in Orissa may be between 30-40 lakh pieces of which more or less 70% comes from other states. This second contradiction (most of the bidi produced in the state is sold outside Orissa whereas most of the bidi sold in Orissa comes from other states) is due to two factors: 1.addiction to a particular brand (which may come from some other state), and 2.cheaper price or some other advantage(s). While availability of quality (processed) KL in Orissa attracts bidi manufacturers to establish manufacturing units in this state, lower production cost of bidi in some other states like West Bengal facilitates the supply of such bidi to Orissa 4 .The situation has its within-the-state counterpart as can be seen in the Raimul village near Ranapur. Whereas the village produces about 20 lakh bidis per week, the villagers themselves prefer the New Orissa Bidi, a brand 4 As an example, the actual labour payment in West Bengal is about Rs.36 per 1000 bidis whereas in Orissa it is Rs.40(not to include government rates or payments made in unauthorized units). 15
manufactured in coastal Orissa . M.C.Patel & Co., manufacturers of good quality Patel Bidi, achieved a production figure of 32 crores(bidi) per annum merely five years ago whereas during 2005-06 this production was drastically reduced to only about 11.57 lakhs. On the other hand, a small manufacturing unit of Balia village near Ranapur has increased its capacity from 1 lakh bidis two years ago to 1.5 lakh bidis, per week now. Such a contradictory situation is simply due to the fact that illegal/unauthorized and/or low-quality operations are essentially low-cost in nature which helps the manufacturers sale their product at a competitive price in the dwindling market whereas authorized and/or quality bidi manufacturers find it increasingly difficult to sustain themselves in the market owing to substantially higher cost of production. For instance, an illegal but big manufacturer may be able to produce his bidi at the cost of Rs.55 per thousand whereas his counterpart, a registered manufacturer of quality bidis, has to spend as high as Rs.120-122 for the same number of bidi production. For those using kendu leaf pluckers as bidi- makers(like those in the Boinda-Athamallik area) the cost of production can be lower than Rs.55 per 1000 as these operators save a lot on establishment, and other expenses. Thus, for one or more reasons the bidi industry appears to have experienced a declining trend in its production during the last 10 years. For instance, as seen in the following chart(#2), in Bargarh, Hirakud, Balangir and Titilagarh areas the production record indicates a decrease by 56.85%: Production in numbers Chart-2 Bidi production by registered units in Bargarh, Bolangir, Titilagarh and Hirakud areas under Sambalpur-II division of Central Excise & Customs 5000000 4000000 3000000 2000000 1000000 0 3625100 1996-97 1997-98 1998-99 1999-2000 2000-01 Year 2001-02 2002-03 2003-04 (based on the statistics provided by Central Excise & Customs) 2004-05 1564000 2005-06 16
Page 1 and 2: The Kendu Leaf Trade: Problems & Pr
Page 3 and 4: A keri of kendu leaves. The colour(
Page 5 and 6: Contents Kendu leaf: an introductio
Page 7 and 8: List of annexure 1. Gradation of Ke
Page 9 and 10: The Kendu Leaf Trade: Problems & Pr
Page 11 and 12: 4.Livelihood dependency of KL pluck
Page 13 and 14: The cost of processing is compensat
Page 15: Chart-1 Forms of tobacco consumptio
Page 19 and 20: One can further see from the two fo
Page 21 and 22: 7.Implications of the crisis: While
Page 23 and 24: Chart-8 Bidi production by M/S. Cee
Page 25 and 26: Chart-12 Total production of bidi b
Page 27 and 28: production accounts for less than 1
Page 29 and 30: • There is a bumper crop. • The
Page 31 and 32: This is obviously because Orissa ha
Page 33 and 34: The Orissa Kendu Leaves Purchasers
Page 35 and 36: Total export to SL & Pak. and the s
Page 37 and 38: In Kadamdihi phadi under Kadamdihi
Page 39 and 40: manufacturers prefer bundles of les
Page 41 and 42: feeling in bidi smoking. And this h
Page 43 and 44: 9..3..2: Non-smoking utilities: It
Page 45 and 46: increased target for phal productio
Page 47 and 48: of this kind has been done in many
Page 49 and 50: though the intention behind such re
Page 51 and 52: ANNEXURE 50
Page 53 and 54: Year Annexure-2 Production, deliver
Page 55 and 56: Year Annexure-6 Sale value of KL To
Page 57 and 58: Annexure-10 Export of KL by Nationa
Page 59 and 60: Annexure-13 Qualitative production
Page 61 and 62: concurrent lease has not been grant
Page 63 and 64: Annexure-19 Media’s concern over
Page 65 and 66: Annexure-21 Concern over the implic
Page 67 and 68:
Annexure-23 Media concern over the
Page 69 and 70:
Annexure-25 Media concern over the
Page 71 and 72:
(Note: The above matter was publish
Page 73 and 74:
Annexure-27(contd.) Letter of M/S.
Page 75 and 76:
Page 77 and 78:
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The Kendu Leaf Trade: Problems & Prospects in Orissa - Vasundhara

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