Alternative Livelihood Loans and Climate Change

Since 1990, Samaj Pragati Sahayog has worked to increase the number of irrigated fields in the Dewas District. SPS has done so through the construction of dams, wells, gabion walls, and other watershed structures in an effort to help farmers adapt to climate change. Previously, farmers in the area relied heavily on rainfall, which has become highly unpredictable due to increasing monsoon variability. In helping farmers irrigate their fields, however, SPS has unintentionally promoted mono-cropping. Farmers now have enough water to sustain fields of cotton, corn, and soybean. Farmers are also beginning to deplete groundwater resources at a higher rate to feed these more water-intensive crops. These practices have made farmers especially vulnerable to the economic consequences of climate change.

In order to address these concerns, SPS promotes indigenous crop varieties, such as sorghum, to decrease the number of mono-cropped fields and to limit groundwater exploitation. The organization also deploys other technologies and management methods to achieve the same ends. Furthermore, SPS created alternative livelihood loan packages, which are available to over 30,000 families in the region. These loans are provided through SPS’s Self-Help Group Program and allow women to purchase cattle, buffalos, goats, and chickens, as alternative sources of income. Additionally, many women purchase sewing machines to tailor clothes for market, or motorcycles so that their husbands can travel to semi-urban or urban areas to work in other industries (e.g. construction).

Although SHGs exist throughout India (they originated in southern India in 1992), SPS focuses primarily on working with women in urban, semi-urban, and rural areas. SHGs serve as alternative options for communities below the poverty line to obtain loans. Before SPS created its regional SHG Program, communities relied heavily on local moneylenders and Microfinance Institutions for loans; however, these institutions provided loans at a significantly higher interest rate and inadvertently promoted indebtedness. SHGs, on the other hand, provide communities easy credit, low rates of interest, tailored loan installments, and the ability for individuals to negotiate the terms of their loans. SHGs also have a social component, as the monthly 2 hour SHG meetings serve as platforms for community members to discuss pertinent issues in their community – whether its alcohol abuse, domestic violence, literacy, or water shortages. These meetings also provide individuals with a space to form friendships and learn about government schemes and programs.

For my honors thesis, I am really interested in the ways in which the SHG Program can combat the economic risks associated with climate change. Although SPS’s SHG Program addresses monsoon variability in a number of ways (e.g. workshops about sustainable dryland farming practices and indigenous seed varieties), I am most interested in its alternative livelihood loan packages. While in India, I had the opportunity to speak to several individuals including mitaans, SPS professionals, and SHG members about these packages. Through my conversations, I learned more in detail why these programs are necessary in monsoon variable regions.

In Patakal Village, which is approximately an hour away from where I was staying, I spoke with one beneficiary of a buffalo loan named Mal. After she purchased her buffalo in 2008, she joined the local dairy co-operative (which SPS manages) for income. Her involvement in the dairy co-operative has increased more dramatically in recent years due to monsoon variability, which Patakal has been particularly affected by. Like many of her neighbors, Mal was hit hard by crop failures arising from unpredictable climate. In fact, most of her fellow SHG members defaulted on their loans due to losses from floods and droughts. In order to mitigate the risks caused by climate change, many of the members, including Mal, began to accept more SHG cattle and buffalo loans. Recently, Mal has fully transitioned to livestock rearing and makes the majority of her income through the production of buffalo milk, which is sold at a higher price at the market due to its high fat content. Mal earns 70,000 rupees annually by producing 10 to 12 liters of milk daily. With her financial success in the dairy industry, Mal has been able to fully fund her children’s education, as well as stave off economic ruin. She is in the process of mobilizing other women in her community to accept cattle and buffalo loans, so that they too can mitigate the economic risks associated with agricultural production.

Dairy Co-Operative

Dairy Co-Operative

Dairy Co-Operative

Dairy Co-Operative

While in India, I listened to other stories that were equally as powerful as Mal’s. Bhuri from nearby Punjapura Village has a poultry loan, which has earned her thousands of rupees. Since partaking in the poultry program in April, she has owned 100 chickens, which she sells in local and regional markets for over 400 rupees a piece. Although she did not initially switch to poultry rearing for the same reasons as Mal, she stated that many others in her village have made the partial or full transition because of climate change. These alternative livelihood loans are important in providing economic protection to rural farming communities.

Many of the women in this image are beneficiaries of SPS's poultry loan in Punjapura Village.

Many of the women in this image are beneficiaries of SPS’s poultry loan in Punjapura Village.

I will not only study why these programs are important to rural farming communities, but also what factors limit their enrollment. Several factors limit enrollment and participation in rural communities such as mistrust, history of defaulting on loans (which make individual ineligible for loan packages), and social pressures (e.g. the purdah and daughter-in-law status). After collecting initial data this summer, I am looking forward to writing my thesis this semester!

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About Kelly Anne Bridges

I recently graduated from the University of Oxford (Class of 2017) with a M.Sc. degree in Water Science, Policy, and Management. Prior to attending Oxford, I completed my B.A. at the University of Pennsylvania (Class of 2016) in Science, Technology, and Society with a concentration is Energy, Environment, and Technology.