Adampur Gram Vikas

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Savings in Bank account as fixed deposit

1.65 lakhs

Interest earned on it

16500

Earning from commission on the supply of agricultural inputs to it members and marketing of their produce, Seed bank

Unknown

Total amount of money in hand more than 1.8 lakh (approximately)

So from the calculation we can see that if all members were working members and if all of them took loan from Mandali (best case scenario) then cumulative money after 3 years of operation could become above 1.8 lakh Rs with members’ contribution of 71043 Rs. whereas amount drawn from bank is 2.76 lakh. But in reality Seed bank and other earnings cannot produce that amount of money so that bank loan can be paid. Also cumulative money is less than calculated amount as we assumed that every member took loan from Mandali. GVA has invested rs. 2.65 lakh in its plantation project covering an area of 312 ha. But in 3 years forest wouldn’t be as productive.

- OBJECTIVES: Ensuring the improvement of efficacy of Mandali so that such problems won’t occur in future keeping in mind the interests of members and objective of GVA and Mandali.

- Decision Problem:

- On what need loans are to be disbursed---productive or domestic use?

- Whether this people are negatively provoked by Deepsinh or Pramukh.

- On calculation it came up if the interest on loan is taken from bank to pay wage is greater than earnings from wages share then GVA should formulate a strategy to make their activities more sustainable to livelihood.

- Decision Criteria:

- Alternatives should cover all the objectives of Mandali that is to provide finanacial and technical support to individual farmers for productive purposes, as and when the Mandali is financially capable enough to lend money to them.

- They should be well defined and acceptable to the Mandali and its members.

- It should benefit the Mandali members in the short and long run.

- Alternatives:

- Stick with earlier verdict of not giving loans for Non Productive purposes and not allow the dissidents to withdraw their contribution because if they withdraw money Mandali will be financially unstabe. Do amendment in the existing by-laws of the Mandali and clearly specify that in future loan would be given only for the Productive purposes in accordance with the objective of Mandali.

- Investigate whether Deepsinh or Pramukh formed a small dissident group within the Mandali and take serious action against it.

- For catering to the Non-Productive purposes of the members create a provision whereby each member would be eligible for such types of loans once in 3 years. Also charge high rate of interest (well above than 18%) for availing loans for Non-Productive purposes.

- Sanctioning of loan to the members, at least to Dharamsinh and Diwansinh – because here they are taking advantage of the loopholes in the bylaws of the Mandali.

- Interest which is earned by disbursing loan to the members is not enough to repay the amount borrowed from bank. So to give away loan to member not sustainable practice without help of other livelihood programme. Now GVA invested 2.65 lakh in plantation programme 3 years ago. In 3 years a forest can’t be so much productive i.e. it can produce so much fruit or wood that can generate income. GVA working as a Micro-finance institute is not able to generate so much money to its members. So alternative livelihood programme should be planned so that it could return back this bank money and can provide some way to generate income for its members. Now it is GVA’s responsibility to pursue this members that in long-term Mandali can become a profit making organisation for them.

- EVALUATION OF ALTERNATIVES:

- It will immediately solve the problem. Also it will help to cover up the existing loop holes in the by-laws of the Mandali. It will ensure that no such incidents occur in the future. It may create unrest among members but a strong message can be given to them which in turn help the members to be united and confront with these situations in long run. The only problem is if 19 members quit the Mandali, then financially the Mandali will become weak. So they can’t be allowed to withdraw money.

- It is strongly required to bring back Mandali’s unity. It may create discontent among some members.

- It will encourage the members to stick with the Mandali on the long term. It will enhance the image of the Mandali among members as Mandali would provide loans for Non-Productive purposes as well. Members will come for the loan only when they would be in genuine needs as they would be knowing that they can extract money only once in two years. Higher interest rates would act as deterrent. Higher interest rate will make members difficult to pay back their loan amount. It may dilute the purpose for which Mandali was setup to provide the loans for Productive purposes.

- This option is not feasible at all as others will start to take advantage sympathetic attitude of Mandali.

- This option is really helpful for long run and sustainable development of Adampur village. Persuasion of member may take long time but it will help members to remain united.

8) CHOICE OF ALTERNATIVE:

For short run combination of alternative 1 and alternative 3 is quite better and these should be implemented in step by manner in next meeting. It is in agreement with the GVA policy also. It ensures that the Mandali is catering to the need of its members for both productive and non-productive purposes. It will also help to regain strength among the members.

For long run alternative 5 must be implemented. As we can see from COST-BENEFIT analysis that Mandali does not have enough amount of money to pay back interest and capital to bank. So it is necessary to implement other livelihood option for sustainable development and also to persuade members that Mandali will be profit making institute after some period of time. Hence their request for loans of non-productive purposes got rejected.

9) IMPLEMENTATION PLAN

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