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Satish Chukkapalli handles two diverse roles. In his corporate avatar, he is the director of the real estate firm Phoenix Group. The other side to Satish, as a co-founder of Zameen Organic Pvt Ltd, speaks of his risk-taking entrepreneurial skills in a segment where profits are tough to come by. We call him risk-taker since it's not often that entrepreneurs want to work with farmers to produce organic cotton in a nation like India, where consuming organic produce or wearing organic clothing is still relegated to small pockets. Of course, there are export orders for organic clothing but it doesn't guarantee huge returns each year.
In 2006, Satish Chukkapalli, Gijs Spoor and Edapalil Mathai Koshy came together to start Zameen Organics Pvt Ltd with a network of 300 farmers. Satish's garment marketing skills, combined with that of Spoor's agricultural engineering and Koshy's expertise in rural development helped the organisation grow. At present, Zameen has under its umbrella around 6000 farmers from Maharashtra (Vidharbha region) and Andhra Pradesh.
In a way, Satish's interest in organic farming can be traced back to the time when he was working in Tirupur, the textile hub of Tamil Nadu. The upside of working in Tirupur was getting to know the best of people in the textile business — garment manufacturing, dyeing technology, fibre technology experts — from Europe. “Tirupur was ahead of other cities by at least four to five years in fibre technology process. We got to meet and work with people from different European brands,” recalls Satish.
The downside was getting to see a huge amount of toxic pollutants being released into the environment. “It made me think about how pollution affects the livelihood patterns of labourers and where we, as people, are headed. I felt the need to move away from conventional techniques and take an eco-friendly approach,” says Satish.
This intention was further fuelled by German customers with whom he interacted at that time. But the market was nascent and there was little clarity on organic cotton in India. Even the basics were tough for a start-up company. “We didn't know where to start from and whom to approach. Organic cotton was also being sold at a huge mark-up price simply because the process is not conventional and organic cotton caters to a niche segment,” points out Satish.
If at all Satish was part of an organisation that worked in the cotton sector, he wanted it to have an impact environmentally, by being eco-friendly, and socially, by connecting directly with farmers. He happened to meet Gijs Spoor, who was working for a fairtrade organisation in Netherlands as a certification expert.
Both wanted to get a head start in the organic farming sector and complemented each other with their different skill sets. “I was an industrialist but knew nothing about agriculture, which he was so good at. If we had to do something that would impact farmers, I wanted to do it in Andhra Pradesh. I moved back to Hyderabad from Tirupur,” Satish recalls.
In conventional methods of cotton cultivation, toxin-high pesticides are used to increase the yield. “We needed rain-fed land and chose Telangana region here and Vidharbha region in Maharastra,” says Satish.
As part of an amibitious project on Fairtrade and Organic Farming in India, mooted by the organisation AOFG India (Agriculture and Organic Farming, of which Edapalil Mathai Koshy is the India director), Zameen Organic Pvt. Ltd was set up as a marketing wing for organic cotton produce.
The ground reality was alarming. “Farmers were borrowing money at a high rate of interest, at times as high as 60 per cent. Unable to repay the debt, they resorted to selling their land. Some of them worked as labourers in their own land and seeing no way out of debt, took to suicide as an exit route,” says Satish.
Zameen was set up as a farmer-owned company, with 51 per cent of the shares being allotted to farmers. AOFG India stepped in to educate farmers on organic farming and its long-term benefits. Getting farmers to understand their point of view wasn't easy. “Farmers focussed on the yield but ignored health repercussions. It took them time to understand that though the output is lesser initially, there are accrued long-term benefits. You avoid spending on pesticides; there are no moneylenders and middlemen. Not to mention the improved health conditions of the farmers. Slowly, farmers came around. We also encouraged them to alternate cotton with soya and toor crops so that they can have earnings once in three months.”
In the first two years, the farmers were a happy lot with good yield and better returns. However, there was setback, too, when the West was plagued with high inflation and recession and consumers thought twice before spending on organic cotton.
“We had to educate farmers on why we need to be open to selling at a slightly lower rate so that we retain customers in the long run,” says Satish.
Now, Zameen is cited as an example for other fairtrade organisations, so much so that it attracts students from abroad to do case studies. Students from Amsterdam Fashion Institute and London School of Business have visited the fields to study the business, environment and social impact. “A few students did an audit on carbon footprint, which helped us,” says Satish.
Organic cotton from Zameen is now picked up by spinning and weaving mills and tie-ups with brands such as Marks and Spencers and Debenhams are an advantage. “The organic movement is growing. We foresee an organic era,” sums up Satish.
It took farmers some time to understand that though the output is lesser initially, there are accrued long-term benefits. You avoid spending on pesticides and there are no moneylenders and middlemen.