Executive Interviews: Interview with Amitabha Sadangi on Social Entrepreneurship
May 2010 - By Syed Abdul Samad and P.Girija

Amitabha Sadangi
Founder CEO, International Development Enterprises India (IDEI)

Water Storage

• Impact Sprinkler Water Storage
• Water Storage Bag Drip Kit
• 5000 Liters Water Storage Bag
• KB Pre-punch Inline Drip

• Technology is one means of overcoming problems related to irrigation. While your innovations as an input provide solutions to just one side of the coin, the other side of the coin, i.e., the problems on the output side (marketing, sales, distribution of the produce, correct market price, traders, etc.) are largely unaddressed. What is IDEI doing in this regard?
  IDEI’s market-based approach takes care of some aspects of this problem. Towards addressing others, IDEI has recently launched a program called Integrating Rural Poor into Market Systems. This program seeks to link smallholder farmers with the output markets directly and, in the process, enhance their negotiating capacities and help them sell their produce at reasonable prices and earn what they rightfully deserve.

• You are against the idea of providing subsidies to the farmers, which the farmers always look forward to. In such a case, how do you convince them about the advantages of your policies?
  IDEI does not believe in subsidies. And this belief allows for the creation of needs for the technologies at our end and also allows healthy holistic growth (that is in the interest of all involved) of the private sector.
  Regarding convincing farmers, it is simple mathematics. Let’s take the example of the drip facility. If a farmer has to install drip irrigation technology at his one hectare farm, it would cost him over Rs. 1 lakh. The government provides subsidy of Rs. 37,000 for this. If the farmer loans money to install it, only the interest that this farmer would pay for a year is way more than the cost of installing IDEI’s drip technology. Plus, IDEI’s drip is not a capital intensive investment. Therefore, the farmer makes a small investment and good profit within one year of investment.

• How do you intend to scale up your business? What are the likely challenges in scaling up the business? Do you think your business model is recession-proof? How/why?
  We work with the rural population, people who are not affected by recession and, therefore, our overall work does not get affected. The challenge lies in arranging credit for smallholder farmers and members of the supply chain.

• How far are partnerships feasible? Recently, one of your subsidiaries has been spun off. Do you think, they (subsidiaries after spinning off) would stick with the social motive or disown it? In such cases, do you see any competition?
  We are hopeful that the units that are spun off will continue to safeguard the interest of the farmers and members of the supply chain. As far as competition is concerned, we do not foresee one. We envisage growth by leaps and bounds for this entity and even with a turnover of about 100 crores (INR) we will be able to provide for 3,60,000 hectares of land and there are 27 million hectares out there. There is a huge potential, so we will continue with our not-for-profit work as well. Plus, healthy competition also propels growth.
  IDEI works with the private sector to develop and promote systems for small and marginal farmers and hence expand their scope of business. Does the government contribute its part?
  Government does play a role and supports the business, although indirectly. To take an example, the government is creating water sources for farmers and using our technologies, farmers can access that water and irrigate their land.

• Can you still extend the scope of your business without the support of the government in the long run? In this case, what is the significant role of private markets in enhancing socially-driven enterprises?
  We can continue without government support. Regarding the private sector, we are encouraging development of private-private partnerships.

• Going by the sociopolitical scenario of our country, where rural mafia raj still exists in some of the states, can this business percolate into the remotest regions of our country and empower rural farmers?
  IDEI is working in 200 villages and of these about 66 lie in naxal affected areas. These projects are doing very well and farmers are enjoying the benefits using our technologies. Based on our experiences, I do not believe in any mafia, etc.

• Your opinion about the future role of youth in this social innovation in the field of agriculture and irrigation? Are they well aware? How serious, do you think, are they about such issues? How important is educating them in these lines?
  I strongly believe that youth are the future of the economy, irrespective of whatever sector one talks about. Taking forward this belief, IDEI even now identifies youth at the village level and builds their capacities, promotes entrepreneurship and connects them back to agriculture per se and will continue to do so. From my experience, I can say that they are very motivated and take pride in what they do!

• Through your mission ‘To improve equitably the social, economic and environmental conditions of families in need, with special emphasis on the rural poor, by identifying, developing and marketing affordable, appropriate and environmentally sustainable solutions through market forces,’ how far have you been successful in providing socioeconomic status to the rural poor?
  We have cumulatively reached out to over 5 million people and one million farmer households. And expanding!

• What are IDEI’s future plans (pan India expansion or innovations or other)? Do you think your business and revenue model would prove to be successful if your business is scaled up? What are the challenges you would likely be facing in fulfilling your future plans?
  We are currently operating in 2% of the villages in India and we plan to grow this to 10% by 2020 and to expand our work’s presence in other countries and provide support/ mentoring as and how required.