Addressing poverty through Inclusion in Global Production Chains: Who wants it ?

1. Addressing poverty through Inclusion in Global Production Chains: Who wants it? Joy Clancy , Victoria Marin-Burgos and Avinash Narayanaswamy University of Twente, The Netherlands

2. Approach • 2 cases related to biofuels GPCs: Colombia & India • Secondary data from Brazil • Confronting notions:‘inclusion in GPCs is good for and wanted by the poor’‘not wanted by smallholders’ • Our position: more complex • We use Granovetter (embeddedness in economic tansactions); political ecology (power relations & languages of valuation); inclusion is multi-dimensional (economic; political; social); agency UKDSA Conference 2013

3. Palm oil in colombia • ‘inclusive businesses’ strategy seeks to integrate small-scale farmers in GPCs. • contract farming arrangements (“productive alliances”) • Associations of small- and medium-scale land holders (supply allies) into the bottom-end of a supply chain of a palm oil extraction company (anchor company) • 25 year contract for exclusive supply • Farmers commit land and buy palms plus technical support from anchor – often with loans. UKDSA Conference 2013

4. Who wants it? • 2000 – 2010 25% new plantations was ‘productive alliances’ • Those opting for inclusion are not homogeneous • Ex-plantation workers – with knowledge of palm – good income opportunity • Farmers previously involved in the illicit coca cultivation – provides legitimacy • Landowning urban dwellers – better rents from their land • Smallholders with ‘no alternative’ – historically marginalised in Colombia – linked to ‘war on drugs’ UKDSA Conference 2013

5. Who doesn’t want it? • Peasant farmers – with subsistence traditions • Palm oil is alien to their production methods • Afraid of undermining food security & tying them to big companies • Plus change to landscape - undermines their cultural identity with the land • Farmers thrown off land they farm under ‘traditional arrangements’Tenant farmersFarmers on state land UKDSA Conference 2013

6. Biodiesel in India • Bio-diesel feedstock is to be grown only on degraded forest and non-forest lands – not to undermine food security • Also what are classified as ‘waste’ lands • Social inclusion, particularly for women and landless people, is a priority • Farmers have right to decide what to do with seeds • Tamil Nadu – jatropha – major problems given the crop a ‘bad name’ UKDSA Conference 2013

7. Hassan Biofuel Park Karnataka • Biofuels Park - awareness raising with villagers • Bio-diesel crops only for supplementing income not as main source • Use bunds and hedges (mainly men) and backyards (women) – traditional practice • Indigenous non-edible species – multiple varieties to ensure all year round seed availability and income • Each village has committee – men and women • Oil mainly goes for local use – despite the project negotiating a ‘good deal’ for farmers UKDSA Conference 2013

8. Who wants it? • Some men – additional income (may be around 10% additional) • Women – new opportunity to earn money where men are not already involved UKDSA Conference 2013

9. Inclusion/Exclusion – more than terms of incorporation • We identified 4 factors influencing inclusion/exclusion: • the role of the government; • the degree of rural people’s control over institutions and processes; • culture and identity with place and landscape; • the role of third parties UKDSA Conference 2013

10. Role of Government • Political choices in framing of support • Colombia – political agenda related to drugs • India – social inclusion of particular marginalised groups • Farmers end-up trapped at low-value end of chain – often on adverse terms of incorporation UKDSA Conference 2013

11. rural people’s control over institutions and processes • Colombia – little influence – even the RSPO participation has been difficult • India – village committees have control over seeds UKDSA Conference 2013

12. language of valuation • Business uses language of the market – land as economic good • Despite CSR – Colombian Palm Companies don’t listen to smallholders • India – government in Delhi classifies huge areas of land as ‘waste’ – this is not the view of villagers • Land is valued by rural people in terms of livelihoods understood as a source of identity • Biofuels business models tend to promote ‘cultural exclusion’ UKDSA Conference 2013

13. Third party support • Rural people use their agency for inclusion or exclusion • They are often politically excluded so third party organisations can be crucial to overcome this • NGOs – for getting good terms of inclusion based on practices which do not promote cultural exclusion • Outside actors & the courts for up-holding rights UKDSA Conference 2013

14. Conclusions – Who wants to be included/excluded and why? • Too simplistic to say ‘terms of incorporation’ • People have their own motivations - beyond economic goals • People also have agency • Non-chain actors also are important • Contribution of our work: cultural values as a major determinant in opting for inclusion or exclusion. UKDSA Conference 2013