Gedu Farmers Cooperative Society

Acknowledgement
Our project has been successful and brought into presentable manner with the benevolent assistance from many generous people. Therefore we are grateful and want to express our heartfelt appreciation and our success shall be credited to the following people who have been with us throughout the entire project research and for their time and effort, moreover for providing us with most relevant information and ideas, which finally has given good shape to our project; Mr. Mahesh Kumar, Adviser
Mr. Sarang Deshmukh, Module guide, GCBS

Mr. Tandin Choephel, Dean Academic Affairs Madam Kencho Dema, Renewal Natural Resources. Dr. Komal Singh, lecturer, GCBS
Mr. Darley Gyaltshen, GUP, Bongo gewog

Besides, we would like to extend our sincere appreciation to the farmers of Bongo gewog for their first hand information during our interview and also to all the individuals who have been part of our project. In particular, we also acknowledge college management for their support, in allowing our group to field visit for the survey in Bongo gewog.

Gedu Farmers Cooperative Society

Executive Summary
Cooperative society is an association of people combined on their own free will to meet up their common financial needs and wants through an equally owned and effectively administered enterprise. The main objective of forming a farmers cooperative society in Gedu is to improve the living standards of the farmers of Bongo gewog and improving their ability to demand better prices for their produce and to eliminate the middle men between the farmers and the consumers. This ensures that the farmers are not subject to exploitation by the trading community. This research is an initiative to start a cooperative movement at Gedu. A survey was duly carried out as a prerequisite of starting up cooperative society in Gedu The research team has collected data pertaining to the views on specialties of the local vegetables, the place where the respondents bought their vegetables from and their views on the establishment of a Farmers Co-operative Society in Gedu. The respondents also feel that the there will be enough vegetable supplies from farmers if the Farmers Co-operative Society is formed. The data collected from the respondents have been tabulated and analyzed. As per the study, consumers preferred the local vegetables and also they felt that a cooperative society would be of great benefit to the consumers, farmers and the community at large. Fifty farmers were interviewed and the data pertaining to various parameters such as Land ownership, Income, Type of Cultivation, Cropping pattern, farming methods and others have been collected analyzed to study the feasibility of starting a cooperative movement at Gedu of Bongo Gewog. In the process the farmers were welcoming the idea of starting a cooperative society and were confident that it would mitigate their hardships and prove instrumental in their development. Upon the analysis of the data collected from the customers and the farmers there prevails a general understanding that there is a need for starting a primary agricultural cooperative society to address the problems of the farmers in agricultural production and marketing. However this research concentrates on cooperative marketing of the agricultural produce by the farmers. The research concludes that it is viable to form a Farmers Cooperative Society in Gedu. The Farmers Cooperative Society would be established with the aim of developing the community, to help the farmers and to gain profit for sustainability of the cooperative society.

Gedu Farmers Cooperative Society

The location of the Famers Co-operative Societys outlet for selling the vegetables would be the Zero market in Gedu Town where there is a market shed built by government. As per the study, 47.5% of the respondents bought the vegetables from the Zero market and only 17.5 % of the respondents bought their vegetables from the Laptsakha market and rest from others. So majority of the respondents purchased vegetables from the Zero market in Gedu Town. There is a probability of success of the Farmers Co-operative Society. The response given by farmers is encouraging as they have expressed their support and appreciation if a Farmers Co-operative Society is formed.

Gedu Farmers Cooperative Society

Chapter one
1.1 Introduction Co-operation means working together. Those who want to work together with some common economic objective can form a society which is termed as co-operative society. It is a voluntary association of persons who work together to promote their economic and social interest. It works on the principle of self-help as well as mutual help. The main objective is to provide support to the members. People come forward as a group, pool their individual efforts and resources into group and work towards achievement of a common goal. There are farmers growing variety of vegetables in Bongo Gewog, due to many reasons they are not practicing commercial production and one among the major reasons being transportation and marketing. In order to solve this problem of the farmers Cooperative Movement will be the adequate solution. Farmers will be benefited in terms of marketing its vegetables because Gedu Farmers Cooperative Society will do on behalf of these farmers. Even customers will also be benefited because local vegetables are considered as organic vegetables and which are healthy and fresh to consume at relatively cheaper prices. The Farmers Co-operate Society will collect the vegetables from the farmers at regular intervals and meet the needs of the local residents and the surplus being transported to the nearest market for securing better prices for the produce. The Royal Government of Bhutan is emphasizing on the promotion of such Cooperatives Societies. This is because it has more positive impact on sustainable development of the country. This kind of cooperative is also appreciated because it reduces rural-urban migration and also solves problem of unemployment to some extent.

1.2 Agriculture in Bhutan Majority of the rural population is directly involved in farming and other related agricultural enterprises. Agriculture will remain the most important source of employment and rural livelihood of the Bhutanese people. The Royal Government has placed continuous emphasis for the development of agriculture from the very beginning of the planned development in the
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country. Majority of the Bhutanese farmers are involved in farming activities in Bhutan. As per the Bhutan Living Standard Survey (BLSS) 2007, 66.6% of the population is engaged in agricultural activities. The Ministry of Agriculture (MoA) for past four decades was concerned about how to grow by establishing various agriculture infrastructure to produce and distribute the inputs. The Ministry of Agriculture is walking the extra mile to develop the agriculture sector by establishing four main Renewable Natural Resources centers. MoA has three basic objectives that are to i) conserve the environment, ii) enhance the rural income and iii) attain self reliance in cereals and essential oil crops. Maize and rice contribute 80% of domestic production, 40% each, and wheat and minor cereals makes the remaining contribution. Increase in the production of maize has resulted in the generating marketable surpluses. Present food grains self sufficiency through domestic production stands at around 65% against the Plan target of 70%. The food grain gap of 35% is met through the import of mainly rice. Bhutan is principally a subsistent agrarian country in terms of GDP composition as well as employment. Agriculture sector makes up about 18.5% of the GDP and it engages about four fifth of the population of the country. As per the Statistical Year book 2009, NSB only 7.7% of the total land is used for agricultural purpose. Projection for growth in agriculture sector is limited due to the rugged terrain, poor quality of soil. Food crop production is generally based on a low level of purchased inputs. Soil fertility is maintained mainly through use of organic manure (National Statistical Bureau (NSB), 2009).

Land Usage: In Bhutan as per the legal requirement of the country minimum of 60 Percent of the forest cover has to be maintained mandatory. It is encouraging that the data of the statistical bureau reveals a forest cover of 72.5 per cent. The agriculture is carried on 7.7 per cent of the land available in total. The balance of the land is used for horticulture, pastures and other purposes.

Gedu Farmers Cooperative Society

Source: NSB STATISTICAL YEARBOOK OF BHUTAN 2009

1.3 Why farmers form cooperatives? Cooperatives as a business organization are quite different from the other form of investor owned firm or business organization. Though both may be form as corporations but when it comes for the profit maximization objectives, cooperatives strive for maximize the benefits for the members. Farmers cooperative is formed when farmers are not able to avail certain services like that of investor own firm. It offers the advantages of economies of scale that are not available to its member individually. For example, the purchase of farm tractor or other necessary equipment, machinery may not be possible for farmers; it is not feasible for individual farmer to use the transportation facilities to market their small volume of output. So Farmers Cooperative Society will act as integrator, collecting the little output from different farmers at particular place, and help in delivering in large aggregated quantities downstream through the marketing channel. And it is not possible to get credit services for farmers or even the loan is sanctioned, the interest charged might be high, moreover collateral security is required. In this case farmer can also form the credit union and the raise loans at advantages rate. Moreover, taking the advantages of economies of scale and volume of discounts, cooperative can bring down the cost of procurement of any input as compared to purchase from other commercial suppliers. 1.4 Objectives of the Study
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Gedu Farmers Cooperative Society

To study the problems of the farmers of Bongo Gewog. To identify the causes and suggest possible remedies and, To initiate formation of farmers cooperative society as a remedial measure.

1.5 Problem Statement: Individual farmers do not receive better prices for their produce and suffer exploitation in the hands of businessmen. There is a need to address collectively the problems of agricultural production and marketing. The Cooperative Movement though a solution for the ills of the farmers, it is not very much prevalent in Bhutan. The research is to elicit public opinion and educate the need for cooperative movement for the development of farmers. 1.6 Location of Study The research had been carried out in the following villages of Bongo Gewog. They are Jumja, Pakshikha, Meritsemo, Jungley, Arikha, Shenchekha, and Gedu. These villages share common identity with all other villages of this Gewog and hence are representative in nature.

1.7 Scope of Study This study will helps in providing the necessary information which is important in formation of Farmers Cooperative Society in the Gedu. The purpose of study is to improve the living standards of the farmers by ensuring better agricultural marketing. This objective can be achieved by elimination of the middle men in the process of marketing of the farmers produce. Farmers Cooperative Society is formed for this very purpose.

1.8 Significance of the study The significance of the study is as follows:

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Serves as valuable information for the promotion of cooperative movement. This research
aims at making significant Contribution to GNH as it focuses on promotion of cooperative movement and thus support the economic development by improving the standard of living of the farmers of the country.

Can serve as a trial project to replicate this idea for establishing Farmers Cooperative Society in other parts of the country

1.9 Limitations During the survey/study, the team has encountered numerous problems which have caused hindrance to the proper running of the work. Followings are some of the problems;

The research team could not collect information from those farmers who reside at nook and corner of the Gewog where there is no road accessibility, Most of the farmers do not keep the record of their transaction and amount of produce, for which farmers are not able to give the team detailed information about their produce.

Gedu Farmers Cooperative Society

Chapter Two Literature Review

Business exist in various forms like sole proprietorship, partnership and joint stock company, it can be differentiated in respect of their formation, operation, capital contribution as well as Liabilities, but one common similarity can be that, all these form of business are engaged in business activities to earn profit. But there is one form of business organization called Cooperative Societies which operate with prime objective as providing service to the member. Though profit is inevitable for a business to grow and survive, and some amount of profit is required to survive, the main intention is not to generate profit and grow but to pool available resources from the members, make proper utilize and share the benefit among the members. For example, say a poor villagers few numbers of cows, get around ten to fifteen liters of milk. Even after consumption by his family daily, he finds the surplus of five to seven liters of milk and what should he do with the remaining liters of milk? Though he might think of selling but may not find customer or market in his village. And if he further tries to sell in nearby town or city, it may not be possible for him due to financial constraint, transportation problems etc. now what can this poor farmer do? So he may not be only farmers facing this problem, there may be many facing similar problems in village and nearby village. And if all farmers with same problem come together, and find the solution for common problem like, collecting surplus milk every morning at common or selected place, send somebody to nearby town and sell, distribute the money according to the contribution, deducting the expense from sale proceeds. With innovative ideas, farmer might go for diversification product like, butter, cheese, milk powder etc. and sell them in the market at a better price, get market in the entire country. Generally, cooperative draw major chunk of unskilled blue-collar workers and also fewer white-collar. The history of modern cooperative can be dated back to Agricultural and Industrial Revolutions of the 18th and 19th centuries. (Co-operative Society Lesson 9-www.nos./Secbuscour/cc09.pdf) The term co-operation is derived from the Latin word co-operari, where the word co means with and operari means to work. Thus, co-operation means working together. (Co-operative Society Lesson 9-www.nos./Secbuscour/cc09.pdf). An autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations
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through a jointly-owned and democratically-controlled enterprise.(International Co-operate Alliance-www.ica.coop) Cooperative society is a form of organization wherein persons associates together voluntarily for the furtherance of their common economic interests. It is an attempt on the part of the weaker sections of the society to join hands against the operations of those who are relatively more powerful. Cooperative societies are always based on the principles of self-help and mutual help. Their primary objective is service and not profit. (A complete course in ISC Commerce Volume I p.130.). Followings are some of the definitions;

A cooperative society which has as its objectives the promotion of economic interests of its members in accordance with cooperative principles.-The Indian Cooperative Societies Act, 1912.

It is a form organization wherein persons voluntarily associate together as human beings on the basis of equality for the promotion of the economic interest of themselves.Calvert (A complete course in ISC Commerce Volume I p.130).

Cooperative organization is an association of persons, usually of limited means, who have voluntarily joined together to achieve a common economic end through the formation of a democratically controlled business organization, making equitable contributions to capital required and accepting a fair share of risks and benefits of the undertaking.- International Labor Organization (A complete course in ISC Commerce Volume I p.130)

Cooperative societies may be formed practically for every purpose and in every walk of life. Some are formed with the purpose of social uplift of their members, while others are formed for the achievement of some common economic objectives. (A complete course in ISC Commerce Volume I p.135.). The idea of cooperative has spread in various forms around the world. In the same way like above mentioned example, people can form other types of co-operative societies as well. Although all types of cooperative societies work on the same principle, they differ with regard to the nature of activities they perform. Followings are some of the principle types of cooperative societies (Co-operative Society Lesson 9-www.nos./Secbuscour/cc09.pdf)
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Consumers Co-operative Societies.

Such societies are formed with a view to protect the interest of general consumers by making goods available at a reasonable price. Consumers can buy goods directly from the producers without involve of the middlemen in the process of distribution. Producers Co-operatives Societies.

Such societies are formed with a view to protect the interest of small producers, that is by making available of required items for production like raw materials, tools and equipments, machinery, etc. Co-operatives Credit Societies.

It is mainly to provide financial support to the members, it is usually acceptance deposits from members and grants members the loans at reasonable rates of interest. Co-operative Marketing Co-operatives.

It is the societies which is formed by small producers and manufacturers who find difficult in selling their products individually. It tries to collect the products from the individual members and sell in the market. Co-operatives Farming Societies.

It is formed by small farmers to work jointly and thereby enjoy the benefits of large-scale farming. Co-operative Housing Co-operatives.

It is formed mainly to provide residential houses to members. Such type of societies purchase land, and constructs houses and apportions the same to members. It also provides loans at low rate of interest to members for the construction of their own houses.

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Farmers cooperative also known as Agriculture cooperative, where farmers pool their resources in certain areas of activity. A broad topology of farmers cooperative is that, it provides service to its farming members. There are two types of farmers cooperatives, supply cooperatives and marketing cooperatives. In supply cooperatives, it supply the members with different inputs required for agriculture purposes like seeds, fertilizers, machinery equipment or services etc, whereas marketing cooperatives helps farmers in marketing of the farm products, packaging etc. (Cobia, David, editor, Cooperatives in Agriculture, Prentice Hall, Englewood Cities,(1989,) P.50, & John M. Staatz, Farmers incentives to take collect action via Cooperatives; A transaction- cost approach, in: Cooperative theory: new Approaches, ed. J.S. Royer, Washington,D.C: USDA ACS Services Report 18(July 1987). PP.87-107) The series of Cooperative movement activities were organized, that began in the 19th century, where people organize themselves around a common goal, usually economic. The term usually refers more specifically to the formation of nonprofit economic enterprises for the benefit of those using their services. The cooperative movement began in Europe in the 19th century, primarily in Britain and France, the Shore Porters Society claims to be one of the worlds first cooperatives, being established in Aberdeen in 1948 (The Shore Porters Society: About UsOur History, 2007, retrieved 6 May 2008). An old and widespread form is the consumers Cooperative, in which people organize for retail or wholesale distribution, usually of agriculture or other staple product. The first consumer cooperative may have been founded on March 14, 1761, in a barely furnished cottage in Fenwick, East Ayrshire, Scotland, as Fenwick Weavers Society where oatmeal were sold at discounted rate to the local workers. It services also expanded to include assistance in savings and loans, education. (Lennoxtown (Local history)). Robert Owen (1771-1858) is considered the father of the cooperative movement. A Welshman, who made his fortune in the cotton trade, has benefited his worker by providing good environment where there is access for education. With this success, he has opened first cooperative store, and with this success he has idea of forming the village of cooperation where workers would drag themselves out of poverty by growing their own food, making their own clothes and ultimately becoming self-governing. (Doug Peacock. Social strife: The birth of co-op. Cotton Times, understanding the industrial revolution.p.3. Retrieved 2008-06-26).
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Cooperatives today are very successful and widespread in many countries. In many European countries, cooperative institution has got dominant and significant market shares in the retail banking, food, funeral service, insurances business etc. Cooperative can be viewed as society formed to reduce the monopoly; it creates competition and provides goods to its member on lower rate. It reduces the member involved or middleman and makes goods available at lower cost. Members of cooperative can do some activities for the common interest. The main purpose of cooperative is to serve its member. It is based on the democratic process. Cooperative societies enjoy economies in management expenses as it is voluntary services provided by the members, so the possibilities of reducing the management expenses exist in cooperative society.

Chapter Three Operational Plan

3.1 Research Design
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In order to carry on this research the researcher has collected the information through primary data and secondary data. A research design is just the guidelines, or simply the framework or plan for the study that guides entire project that are, the collection of the data required, analysis of the data collected. It also specifies the method of data collection, analysis. Information about the respondents opinion and suggestions will be recorded and analyzed using the appropriate statistical tools. The research method selected for the study is a combination of a survey which includes questionnaire and interview method. Survey is designed in a way that; 1. Primary data required can be gathered from the sample that represents the population. 2. Easy for respondents to understand The random sampling techniques has been adopted as it make possible to give every element in the population a known and chance of belonging to the sample and by doing it, so that wrong information from the sample is minimized to possible extent. Data is collected directly from the respondents. Basically the survey has been conducted to understand the background of the farmers and to make a realistic assessment of their problems. The other intention behind this research was to garner the farmers opinion with regard to the starting of the cooperative society.

3.2 Methodology The research methodology is a systematic way to solve the research problem. The authenticity of the research depends on the data collection and the method used for it. The research conducted is descriptive in nature. The research team has collected the information by preparing questionnaire, interview, observations, etc., and after collecting the information it has analyzed it by using statistical tools. 3.3 Data Collection Method Generally, the collection of data involved two sources that is, the primary and secondary data. In this case mainly the decision will be based on the primary data. The primary data collection instrument in this study was questionnaire and interview.
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The interview was conducted with the farmers within the Bongo gewog, and also the shopkeepers were interviewed. Some of the questionnaires were distributed to the customers of Gedu town. In overall, the team has personally met the respondents for getting the true and right information. Primary Data 1. Interview Method 2. Questionnaire Method The questions to be asked during the interview and in the questionnaire are framed in line with the objectives and also considering the value of time of the respondents. The heavy emphasis was given on the verbal report from the subjects to get the information. The interview method give high completion and response rate as compare to other method. It gives respondent a chance for clarification of misunderstood questions. 3.4 Description of Data Presentation and Analysis Tools For the presentation of the data, tools like simple bar chart, histograms, pie diagrams and pictorial tables are used. The most important part of the table includes Table numbers Title of the table Caption Stub or the designation of the rows and columns The body of the table. The head note or prefatory note or explanatory just before the title; Foot note, which is an explanation not at the end of the page source note, which refers to the literally or scientific source of

The data is to be analyzed by means of percentage, measures of central tendency (average mean). Percentages express the ratio of two sets of data to a common base of 100. Percentages facilitate comparison and address the problem of the misleading tendency of absolute in which 8 over 10 is greater than 12 over 15 as the first ratio gives a percentage of 80 while the later gives a percentages of 75.
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3.5 Data Processing The data collected will be processed using the statistical tools. And processing will involve inspecting the response given by the respondents during interview, and data collected through questionnaire. Besides, suggestions given by respondents will also serve as one of the tools for preparing the report.

3.6 Sample size Farmers Out of eighteen villages under the Bongo gewog, only seven villages are accessible by road. It was found that almost all the farmers under Bongo Gewog grows vegetables but villages which have got road accessibility seems to be extensively engaged in commercial farming as compared to other villages. In total a random sample of fifty farmers from villages with road accessibility were considered for collecting the data required for the studying the feasibility of starting up the Farmers Cooperative Society in Gedu.

A descriptive of the villages are tabulated as under: SL.No 1 Villages Tokto Gongmo No. of Household 14 Road Accessibility No

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2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

Tokto Wongmo Chungkha Chasilakha Jumja Beri Gedu Pakshikha Meritsemo Damje Ketokha Jungley Bongo Phatshuma Zamsa Baigensa Geduphu Arikha-Shenchekha

42 61 9 32 15 60 32 40 15 45 18 55 22 15 40 14 19

No Yes Yes Yes No Yes Yes Yes No No No No No No No No Yes

Shopkeepers The team has also interview following shopkeepers in Gedu market who are main dealers in vegetable produce, where they could collect the information regarding the demand and supply patterns, and the source from where they procure the vegetable. Zeko General Shop(Zero Market)
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Thinly General Shop(Zero Market) Dawa General Shop(Zero Market) Indra Kumar General Shop (Laptsakha Market)

Customer To collect the views pertaining to the customer satisfaction researcher have selected sixty customers (including 20 local residents, 15 lectures and 25 students) residing in Gedu Township. Questionnaires were distributed among the respondents to collect different views on the price, supply and quality of vegetables from India and the vegetables produced by the local farmers.

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Chapter Four Empirical Investigation

Bongo Gewog Profile There are eighteen villages under Bongo Gewog. Seven villages of the Gewog are accessible with farm roads and the rest of the villages are not accessible by farm roads. Bongo Gewog is the biggest gewog in Chukha Dzongkha with an area of 396 square kilometers and 536 households. The climatic condition of the Gewog is hot in summer with heavy rain and it is cold and dry in winter. The area of arable land in Bongo Gewog is 4365.83 acres. Bongo Gewog has one agricultural extension center and a livestock extension center. Only 65.61 acres of land is used for kitchen garden purposes. Type of Land use by Bongo Gewog.

Source: Gup of Bongo gewog

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4.1 Area of cultivated land Table No. 1: Area of land used for producing vegetables by 50 farmers

Sl.no Area of land (decimal) 1 2 3 4 5 0-20 20-40 40-60 60-80 80-100 Total

No. of farmers 15 20 7 5 3 50

Table No. 2 Calculation of mean on land used for cultivation

Sl.no Area of land (decimal) 1 2 3 4 5 0-20 20-40 40-60 60-80 80-100 Total

Mid value (X) 10 30 50 70 90

F 15 20 7 5 3 50

d=X-A -40 -20 0 20 40

Fd -600 -400 0 100 120 -780

For the calculation of the average we have to find the mean and for this, 50 decimal is taken as assumed mean, A. Formula to calculate Mean is X=A+Fd/ N therefore; =50 + (-780/50) = 34.4 decimal
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Since: A=50, Fd = -780, and Number of frequency N = 50

The average cultivable land holdings of fifty farmers of Bongo Gewog are 34.4 decimal.

4.2 Income of farmers Farmers earnings from the sale of vegetables (weekly) Table No. 3: Weekly income from the sale of vegetables. Earnings (in Nu.) 0-200 200-400 400-600 600-800 800-1000 Total No of farmers 15 14 16 3 2 50

Table No. 4: Calculation of the average income of the farmers Earnings (in Nu)
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No of farmers

Mid-Value

(X-A)=d

Fd

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F 0-200 200-400 400-600 600-800 800-1000 Total 15 14 16 3 2 50

X 100 300 500 700 900 -400 -200 0 200 400 -6000 -2800 0 600 800 Fd = -7400

For the calculation of the average we have to find the mean and for this, 500 is taken as assume mean, A. Formula to calculate Mean is X=A+Fd/ N therefore; =500 + (-7400/50) =Nu.352 Since: A=500, Fd = -7400, and Number of frequency N = 50

The weekly average earnings of the 50 farmers of Bongo Gewog are Nu 352 in a week. The monthly average earnings of the farmers is (352 * 4) = Nu.1408.

4.3 Farming methods Table No.5: Count of farmers methods of farming Farming methods Traditional Count 43 Percentage 86 %

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Modern Mixed Total

2 5 50

4% 10% 100%

Table No.5 depicts the farming methods practiced by the farmers of Bongo Gewog. As per the interview, 43 farmers making up 86% of the respondents practiced traditional methods of farming. 2 farmers making up 4% of the respondents practiced modern methods of farming on a small scale. Few farmers who are nearby agriculture centre, they get helps from agriculturists and practice modern farming methods. On the other hand 5 farmers making up 10% of the respondents practiced traditional farming methods with a mix of modern methods on very small scale. Figure no.1: Graphical representation of farming methods followed by farmers

As per the survey, majority of the farmers practiced traditional farming methods. The reason farmers cited for following traditional method of farming was because of the inaccessibility to education on modern methods of farming. The government has not conducted any sort of trainings and workshops on modern methods of farming; however as per the farmers response there is a government scheme of distributing free seeds to them and the farmers are also interested in learning modern methods of farming.

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If the Gedu Farmers Co-operative Society educates the farmers on the modern methods of farming, the productivity or the yield of vegetables would considerably increase.

4.4 Nature of Fertilizers Table No.6: Types of the manures used. Types of manure used Natural Chemical fertilizer Total Count 48 2 50 Percentage 96 % 4% 100%

As per our interview, 48 farmers comprising 96% of the respondents said that they didnt use any sort chemical fertilizers other than natural manure (cow dung). The reason they stated for not using chemical fertilizer were because they didnt have any ideas pertaining to the procurement and usage of chemical fertilizers. Two farmers comprising 4% of the respondents used chemical fertilizers mixed with some natural manure. They stated that chemical fertilizers helped them enhance productivity. As per the interview with the farmers, 96% of the respondents actually cultivated organic vegetables; however they didnt know that they were cultivating organic vegetables and they were unaware of the values of organic vegetables. Figure No.2: Graphical representation on the types of manures used.

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This is a good indication for the farmers cooperative society because most of the customers like consuming organic vegetables. Organic vegetables are fresh and healthy without chemicals addition and therefore are widely preferred by the customers. Indeed its a low cost production for the farmers because they do not have to spend extra money on the purchase of the chemical fertilizers. From the survey, the customers prefer organic vegetables than non-organic. But due to problems like transportation and manpower, the farmers are not able to make a regular supply to customers.

4.5 purpose of Growing vegetables Table No 7: Table showing farmers views of growing vegetables. Commercial purpose Count
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Percentage

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Yes No Total

43 7 50

86% 14% 100%

As per the survey, 43 farmers (i.e. 86% of the farmers) grow vegetables for marketing purposes on a small scale. This is because it is studied that the family rely solely on the income from the sale of the vegetables. 14 % of the respondents comprising of 7 farmers who have responded saying that they dont produce vegetables for market purpose. They responded that it was a problem for them to transport their produce and they lacked manpower. Figure No.3: Graphical representation of above table

When 86% of the farmers say that they grow vegetables for the market purpose than it is more feasible for the farmers to form a Farmers Cooperative Society. Farmers Co-operative Society will help the farmers market and transport these vegetables. Farmers Cooperative society will also help the farmers increase the yields and will further encourage to practice agriculture farming.

4.6 Average production

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Weekly estimation of the quantity of vegetables from an average of 50 samples of farmers Table No.8: Types and quantities of vegetables produced by villagers of Bongo gewog Sl.No Common types of Average produce of total house hold weekly 1134 bundles 2062 kgs 618 kgs 309 kgs 206 kgs 258 kgs 155 kgs 309 kgs 103 kgs 309 kgs

vegetables produced 1 2 3 4 5 6 7 8 9 10 Spinach Potato Chili Beans Cabbage Tomato Brinjal Radish Onion Cauliflower

Note: calculations attached in the appendix IV Figure No. 4: Graphical representation of table no. 8

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These are the common types and quantities of vegetables grown in Bongo gewog. The above quantity is derived by taking average from the samples of 50 farmers of Bongo gewog. Among the various types of vegetables grown by the farmers, the highest quantity of vegetable grown is Potato and lowest is the brinjal and onion. There are almost all types of vegetables grown in Gedu. It is an annual production of vegetables of 536 households (farmers) and then converted into weekly production. As per the survey conducted, there were some problems faced by the farmers in the process of production of vegetables which are as follows: No accessibility to modern techniques of farming As per the interview, farmers had a very poor understanding on the modern techniques of farming; they didnt receive any supports from the government on modern techniques of farming. Pest problems As per the interview, one of the common problems faced by the farmers is the problems with regard to pest. They didnt have any ideas with regard to controlling pest.

Marketing problems

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Farmers have the competence to fulfill the demands of Gedu; however they are facing problems of selling their produce. Farmers are also facing problems in transporting their produce to the market. With these problems faced by the farmer, still they are able to harvest these quantities of vegetables and market few. As per the interview conducted with the farmers, it will be of great help for the farmers if a Farmers Co-operative Society is formed where; The farmers would be educated on the modern methods of farming.
Letting them to devote most of their time in production of vegetables because the

Farmers Co-operative Society will be selling the vegetables on their behalf. This will help them in managing time and reduce transportation cost. Farmers Co-operative Society would help its members acquire the best seeds.
The Farmers Co-operative Society would help the farmers in transporting their produce

to the market.

4.7 Selling method of farmers Table No. 9: selling method followed by the farmers. Methods Selling it directly to the shops Partly selling it to the shops and rest by themselves Selling it by themselves Total 6 50 12% 100% Number of farmers 30 14 percentage 60% 28%

Among 50 farmers, 30 farmers making up 60% of the respondents sold their vegetables directly to the shops. 14 respondents making up 28% of farmers sold their vegetables partly to the shops and rest by themselves. 6 farmers making up 12% of the farmers sold their vegetables on their own. Majority of the farmers making up 60 percent of the respondents sold their vegetables directly to the shopkeepers in Zero market and the Laptsakha market.
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Figure No.5: Pie chart representation of the table No.9

As per the interview made with the farmers, the problems faced by the farmers when selling it directly to the shopkeepers are as follows: They receive very low price for the vegetables Sometimes the shop keeper reject the vegetables Present vegetable market is not functional Rainy season makes it difficult for the farmers to sell their vegetables

The problems faced by the farmers when selling it by themselves are:

With all these problems faced by the farmers as per our survey, the Farmers Cooperative Society in Bongo Gewog would help them in following ways: they dont have to worry about the marketing of their produce they dont have to worry about transporting their produce to the market they will get a regular and fairly good price on their produce

4.8 Views of Local public Views of the Customers; local farmer are producing enough vegetables to meet the demands of the Gedu residents.
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Gedu Farmers Cooperative Society

Table No.10: showing views of respondents Respondents Local residents Responses Yes No No Idea Total 3 13 4 20 4 21 7 25 1 5 2 15 8 39 13 60 Students Lecturers Total

Figure No. 6: Graphical representation of the table No.10

As per the data collected on whether the local farmers are producing enough vegetables to meet the demand of the Gedu people or not, 8 out of 60 samples including 3 local residents, 4 students and 1 lecturer has responded saying yes. 39 of the respondents including 13 local residents, 21 students and 5 lecturers has responded saying No. whereas 13 of the respondents are ignorant about it. This indicates, though the farmers have production but they do not market their products
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Gedu Farmers Cooperative Society

due to problems or they do not market directly to customers. They sell it directly to the shopkeeper but the customers do not recognized as organic vegetables when buying from shops

4.9 Places where customers buy the vegetables Table No.11: Preference of place for buying vegetables by the customers Buyer Seller Laptsakha Farmers Zero Market Others Total Local residents 8 6 14 2 30 7 3 13 2 25 1 1 3 0 5 16 10 30 4 60 26.6% 16.6% 50% 6.6% 100% students Lecturers Total %

As per the data collected through questionnaire, out of 60 samples, 16 ( rated to 26.6%) of the respondents including 8 local residents, 7 students and 1 lecturer bought vegetables from Laptsakha market; 10 (25%) of the respondents including 6 local residents, 3 students and 1 lecturer bought vegetables from the farmers; 30 (50%) of the respondents including 14 local residents, 13 students and 3 lecturer bought vegetables from the Zero market; 4 (10%) of the respondents including 2 local resident and 2 students bought vegetables from other seller. Figure No.7 Pie representation of table No.11

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Gedu Farmers Cooperative Society

This indicates the feasible of market location with maximum number of customer purchasing from Zero market since Farmers Cooperative Societys market will be at Zero.

4.10 Common type of vegetables sold in Gedu Table No 12: Types and quantities of vegetables sold by shopkeepers in Gedu Sl.No 1 2 3 4 5 6 7 8 9 10 Common types of vegetables sold Spinach Potato Chili Beans Cabbage Tomato Brinjal Radish Onion Cauliflower Total Quantity 300 bundles 1100 kg 335 kg 192 kg 310 kg 290 kg 123 kg 135 kg 390 kg 345 kg

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Gedu Farmers Cooperative Society

These are the commonly consumed vegetables in the Gedu Township. The graph represents the common types and total quantities of vegetables sold by the various shops in Gedu region in a week. Following are the list of shops in Gedu selling vegetables:

Zeko General Shop(Zero Market) Thinley General Shop(Zero Market) Dawa General Shop(Zero Market) Indra Kumar General Shop (Laptsakha Market)

Figure No.8 Graphical Representation of table No.12

As per the interview with the shopkeepers the main suppliers of the shopkeepers are from west Bengal, Falakata. The reason that the shopkeepers bring in the vegetables form Falakata are as follows: Price

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Gedu Farmers Cooperative Society

The shopkeepers have responded saying that the vegetables from Falakata are cheaper as they purchase vegetables in bulk. So the shopkeepers get the vegetables at a lower rate because they are the regular customers of the suppliers of Falakata. Regular supply The shopkeepers have made contracts with the suppliers in Falakata, so the suppliers in Falakata supply the vegetables as per the contract agreement on a weekly basis.

4.11 Farmers view of joining cooperative society Table No.13: Farmer interest in joining the cooperative society Farmers decision Yes No Not sure Total No of farmers 47 0 3 50 Percentage 94% 0 6% 100%

Out of 50 samples 47 (94%) farmers are willing to join Farmer Cooperative Society where they are very much interested. Majority of the farmers have accepted and shown their interest because they felt that a Farmers Cooperative Society would help the members and the community develop. Three of the farmers are not sure in becoming a member of the cooperative society; these farmers didnt understand the benefits of the Co-operative society. However they would become the members of the Farmers Co-operative Society when they see that their neighbors are getting benefited from this cooperative movement. Figure No.9 Pie representation of the table No.13

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Gedu Farmers Cooperative Society

4.12 Customers View on the Establishment of Farmers Co-operative Society in Bongo Gewog Table No.14: Acceptance from the customers side Customers decision Yes No Not sure Total Number of customers 51 3 6 60

Out of sixty samples, fifty one of the respondents have shown their interest in the establishment of this Farmers Co-operative Society because of proximity of market, more over they will have fresh and healthy vegetables with uniform price. Three respondents are against the view of establishing the cooperative society because they feel that local vegetables are expensive. Six respondents are neutral. Majority of respondents are in favor of establishing the Farmers Cooperative Society. The customers dont have to worry about the availability of vegetables as they will be getting timely supply.
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Gedu Farmers Cooperative Society

Figure No.10: Graphical representation of table No.14

Chapter Five
5.1 Formation of Gedu farmers Cooperative Society Gedu Farmers Cooperative Society will help boost the vegetable productivity and sales of Bongo Gewog. It will be set up in Gedu given that the market for vegetable is located in Gedu. Gedu Farmers, Cooperative Society would be a primary cooperative society, which is the first level of cooperative under THE CO-OPERATIVE ACT OF BHUTAN, 2001. Main purpose of the co-operative would be to provide customers with fresh organic vegetables and to fulfill the
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Gedu Farmers Cooperative Society

economic needs of members and the community at large. It would be accordingly registered with the Ministry of home and cultural affairs as per the mandate in THE CO-OPERATIVE ACT OF BHUTAN, 2001.

5.2 Gedu Cooperative Societies: The structure of the cooperative society would be in accordance with Article 13 of THE COOPERATIVE ACT OF BHUTAN, 2001. Name: The name of the cooperative society would be GEDU FARMERS CO-OPERATIVE SOCIETY; the co-operative society would be located in GEDU. Registered Address: The Gedu Farmers Co-operative Societys head office will be in zero market in Gedu Township under Bongo Gewog. The registered address of the Bongo farmers co-operative society will house the office the manager and other staffs. Object: The purpose of the Co-operative society would be to make the Agro products of Gedu well-liked by the residents of Gedu and the neighboring Dzongkhags in the subsequent years. The Farmers Co-operative Society would be ensuring a fresh and regular supply of vegetables to the customers at a competitive rate with the vegetables from India. The Farmers Co-operative Society would ensure the economic and social progress of its members and the Bongo gewog at large. Motto: Gedu Farmers Cooperative Society will be helping the members of the co-operative society and the communities fulfill their financial needs and demands. Farmers of Bongo Gewog are solely dependent on the farming activities and are subsistence farmers. They grow crops and vegetables following the traditional methods of farming inherited from their forefathers. The farmers
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Gedu Farmers Cooperative Society

cultivated crops and vegetables on a very small scale solely for their own consumption and then sold the remaining vegetables to the people of Gedu Town. The Farmers Co-operative Society would help address the following needs and demands of its members: Improving the living standards of the farmers:

Farmers are solely dependent on the farming activities and their means of earning comes only from the sale of vegetables. However their sale of vegetables is on a very small scale. Farmers need to grow vegetables on a large scale for commercial purpose. Gedu Farmers Co-operative Society would help its members grow vegetables for commercial purpose by educating them on the modern methods of farming, so they can enhance the productivity of vegetables. Marketing the vegetables of the farmers:

The farmers of Bongo Gewog are facing problems of selling their vegetables; they are in need of a well organized vegetable market in the Gedu Town. Farmers are growing vegetables on a very small scale; even then they are facing problems of selling these vegetables. So a well organized vegetable market would help its members sell whatever they grow. Gedu Farmers Co-operative Society would sell of the vegetables grown by its members. Need for a transportation service

Farmers face great difficulty in reaching their produce to the market. Farmers grow vegetables on a very small scale and they have minimal quantity of vegetables to be sold, so hiring a vehicle is very expensive. So the farmers carry the vegetables on their back to the market. Gedu farmers co-operative society would organize a transportation facility whereby the members vegetables would be collectively transported to the market. The cost of transporting would be reduced as the cost would be born by the members collectively. Need for a credit facility

The Farmers Co-operative Society would help its members avail credit facility at no interest rates for a period of three months and then if the members are not able to pay back within the stipulated time frame, then a minimal interest rate would be charged. The credit facility would help the farmers in procuring farming tools and equipments

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Gedu Farmers Cooperative Society

5.3 Governance Constitution and By-Laws: The Gedu Farmers Cooperative Society intends to adopt the By-laws and the constitution as provided in The Co-Operatives Act of Bhutan, 2001. Ownership and Administration: The Gedu Farmers Co-operative Society will be owned by the farmers of Bongo Gewog. All members share in the profits of the Co-operative will be in direct relation to the number of shares held by them. Gedu Farmers Co-operative Societys board of directors would be comprised entirely of farmers. The board of directors will be elected by the members to formulate plans for the co-operative society. Gedu Farmers Co-operative Society will elect 5 of their members to serve on a board of directors as per The Co-operative Act of Bhutan, 2001, article no 13 for a period of one year. A chairman, vice chairman, secretary and a treasurer will be elected from the board and special committees will be appointed as per the need of the business to supervise definite areas of the cooperatives business and to report findings to the board. The co-operative will be managed by a manager selected by the board of directors, to staff and manage the business in the best interest of the members in line with policies and procedures established and approved by the board of directors. Diagrammatic representation of the structure of Gedu farmers Co-operative

Farmers Board of Directors

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Gedu Farmers Cooperative Society

Manager

Staff

Membership: Gedu Farmers Cooperative Society would be set up with farmers of Bongo gewog who have shown a great interest in the formation of a co-operative society as per the survey. According to THE CO-OPERATIVE ACT OF BHUTAN, 2001 Co-operatives are voluntary organizations, open to all people who are able to use their services and willing to accept the responsibilities of membership, without any discriminations. All the farmers who wish to become the members of the cooperative society have to subscribe to the share capital of the society. The Membership is open to all the farmers without any discrimination. No member can hold share capital more than 10 per cent of the total capital of the cooperative society (Article 20 of the Act).

Gedu farmers co-operative society would be governed by the elected representative among the members, who actively participate in setting the guidelines and plans of the co-operative. The elected representatives among the members would engage themselves in implementing the plans of the cooperative and they would be answerable to other members. All the members of the Gedu Farmers Cooperative Society would have equal voting rights.

Limited Liability: The liability of the members is limited to the extent of their contribution to share capital (Article 19 of The Co-operatives Act of Bhutan,2001). General Assembly

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Gedu Farmers Cooperative Society

Gedu Farmers Cooperative Society shall have a General Assembly as the highest legislative body and composed of all qualified members. The powers and responsibilities of the General Assembly are as prescribed in the Constitution and By-Laws. Meetings of the General Assembly: Regular General Assembly shall be held annually and special General assembly shall be held in accordance with the By-Laws. Quorum: A quorum of a regular or special general assembly shall be simple majority or fifty one percent of all qualified members. Board of Directors: Every registered co-operative shall have a Board of Directors as the policy- making body. The powers, duties and accountabilities of the Board and officials shall be as prescribed in the constitution and By-Laws. Board composition: the Board shall be composed of a minimum of five and maximum of fifteen members who are elected directly by the General Assembly. It shall elect from its members the following officials who shall serve for one year and will be eligible for re-election: 1. Chairman 3. Secretary. 4. Treasurer. Board meeting: Regular meetings shall be held monthly. Special meetings may be called by the chairman or by majority of members. Quorum for Board Meetings: A quorum of a regular or special meeting shall be simple majority or 51 % of the members of the Board of Directors. Committees: Gedu Farmers Co-operative Society shall have a finance, audit and election committee with three members each who are elected directly by the General Assembly and to serve for a term of two 2. Vice Chairman.

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consecutive years with re-election. The audit committee shall also oversee the function of inventory of goods. Education and Training Committee: An education and training committee shall be established by the board of directors chaired by the vice-chairman of the board Liability of directors, officials, committee members and manager: Directors, officials and committee members, who willfully and knowingly vote for an ascent to patently unlawful acts or who are guilty of gross negligence or bad faith or acquire any personal or pecuniary interest in conflict with their duty, shall be liable jointly and individually for all the damages resulting therefrom to the cooperative, members and other persons. Termination of Membership: Membership may be terminated on the following reasons: Withdrawal of membership, upon giving a notice before 30 days. Death or insanity of the members. Board may also remove a member upon simple majority of votes on the following grounds: Failure of the members to support the co-operative for a period of time fixed by the board of directors Failure of the members to comply with his/her obligations Violation of the constitution and by-laws and the policies of the Board of Directors; and Committed acts or omission injurious or prejudicial to the interest or welfare of the co-operative. Voting: In Gedu Farmers Cooperative Society each member is entitled to one vote.

5.4 Financial Management

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Gedu Farmers Cooperative Society

Capital and their sources: The capitalization and accounting of resources of Gedu Farmers Cooperative Society shall be governed by The Co-operative Act of Bhutan, 2001 and the rules issued by the Ministry of Home Affairs. Members Share Capital: It is the responsibility of every member to contribute share capital for the operation of the co-operative. The co-operative shall issue share certificate as proof of the amount contributed by the member. The share capital of members shall earn interest based on the constitution and by-laws.

To ensure wider ownership of members of the co-operative through share capital, no member other than the co-operative itself shall own or hold more than ten per cent (10%) of the total share capital of the co-operative. (Article 20: Share capital, interest and limitations to share capital holding of the Act).

The Gedu Farmers Co-operative Society will have a registered capital of Nu. 5, 00,000. This registered capital will be divided into 5000 shares of Nu. 100 per share. Investment of Capital: The Gedu Cooperative Society will invest its capital in any of the following: 1. In shares or debentures or securities of any other co-operative; 2. In any reputable bank in the country or any company listed in the Royal Stock Exchange of Bhutan; 3. In securities issued or guaranteed by the Government; 4. In real estate primarily for the use of the co-operative or its members; or 5. In any other manner authorized in the constitution and by-laws or approved by the General Assembly.
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Revolving Funds: The Gedu Farmers Cooperative Society will collect a monthly subscription of Nu.100 from each member towards revolving funds. It shall also deduct 10 per cent from the proceeds of products sold or per unit of product handled. Audit: The Gedu Farmers Cooperative Society shall be subject to annual audits by qualified auditors as certified by the Royal Audit Authority. The auditor shall submit his report of audit to the audit committee of the cooperative. The audit committee after thorough review shall submit the audit report, with its comments/ observation to the Board of Directors. The Board of Directors shall present the audit report to the general assembly. Allocation and Distribution of Surplus: The Gedu Farmers Cooperative Society shall at the end of the accounting period allocate the net surplus earned as follows: Transfer to Reserve Fund: Co-operative education and training fund: Optional Fund: Interest on capital and patronage refund. The remaining balance of the net surplus shall be made available to members as interest on their capital and as refund for their patronage of the products and services. 30 percent of Net surplus. 10 percent of Net surplus. 10 percent of Net surplus.

5.5 Operation and working of Gedu Farmers Cooperative Society:

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Gedu Farmers Cooperative Society

The Gedu Farmers Cooperative Society will ensure the timely collection of agricultural products from the farmers and make it available to the nearest market. The farmers will be paid weekly on the basis of the quantity supplied by them to the society at a fair price (Market selling price transport and handling charges 10 per cent towards revolving fund). The Society will have Local Collection points and one Central Depot. The farmers will reach the products to the local collection points and from there; the society personnel will transport the products to the central depot. In the central depot the products will be graded, packed and then sent to the market for sale. Primarily the products will be sold in the local market by the society itself and surplus after meeting the local requirements will to transport to the other major markets. The cooperative society will constantly update itself with the prevailing market prices across the border market to suitably price its products. The society is run on the principle of equal justice for all its members and is not for profit.

Collection of Agro Products from Farmers: Gedu Farmers Co-operative Societys have two tier systems for collection of agricultural products from the farmers: the local collection point and Central Depot (central point). Local collection points are the places where the farmers can gather their agro products i.e. vegetables near nearest point of road accessibility. The local points places are Alaykha, Pakshikha, Meritshemo and Tala (near the high school). From these local point products will be collected by the cooperative personnel and are transported to the central depot. Central Depot: This is the point where all the agricultural produce of the farmers are collected, graded according to its quality, packed and neatly transported to the nearest market for sale at better prices. Local Sale point: Vegetables market in Zero market (Gedu town), is the place where the vegetables are displayed and made available to the customers. The reason for selecting the vegetable market in Gedu would be on the basis of the findings as per the survey and some other reasons which are as follows:
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As per the survey majority of the respondents purchased their vegetables from the Zero market. Respondents felt that Zero market was easily accessible as compared to Laptsakha market.

The vegetable shed built by the Government for the farmers is still empty. As the Cooperative Society is owned by the Farmers of Bongo Gewog and the vegetable shed is built by the government for the farmers. So there wont be any problems with regard to using the vegetable shed and the store attached to the vegetable shed.

Easy accessibility to the highway is one of the reasons for selecting the zero market in Gedu Township.

Surplus Produce to be sent to other major markets: The surplus produce after meeting the local requirements will be transported to other major markets for better price.

Diagrammatically representation of distributing farmers produced

Farmers

Local point II Local point I

Local point III Local point IV

Central Depot
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Local Market

Surplus to other major market

The Gedu Farmers Co-operative Societys vehicle would be collecting vegetables twice in a week from the farmers.

Recording books for Gedu Farmers Cooperative Society: Acc No. .. Sl. No. Name of the Farmers .. Village . Quantity Sold Amount received Amount paid Remarks

Type of Vegetables

Total Amount

5.6 Farmers Accounts: Every farmer will have an account with the cooperative society. This account shall record the quantity of agricultural product made available to the society by the farmer in a chronological order. Every farmer will be paid weekly for his produce by the society after making a deduction for transportation expenses and an additional deduction of 20 per cent of the selling price towards revolving funds.
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Recordings books for Farmers Name of Farmers: .. Village Sl. No. Types of vegetables Quantity Supplied Acc. No. Amount received Remarks

Total amount

5.7 Product Gedu Farmers Co-operative Society would supply a fresh agricultural product that ideally satisfies the needs of the customers of Gedu Township. Members of Gedu Farmers Co-operative society will not use any sorts of chemical fertilizers in the production of vegetables. Rather it would educate the members on using natural fertilizers to combat pest problems and enhance productivity. Following are some of the methods that the members of the Gedu Farmers Cooperative Society would be educated upon:
1. The Farmers Cooperative Society would be educating the farmers to create and maintain

a healthy farm ecosystem. The farmers would be taught various methods in maintaining a fertile and chemical free soil. Some of the techniques are as follows: Good soil The Farmers Cooperative Society would educate the farmers to use organic materials to ensure a good supply of nutrients, making a healthy soil ecosystem and strong plant resistant to pests and diseases.\ Crop rotation and plant diversity These would prevent a buildup of the pests that attack one crop.
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Choice of plants These would help in reducing pests and diseases. The farmers would be encouraged to use resistant and appropriate plants to the conditions. 2. Good farming practices These include ensuring a good air circulation, good drainage and appropriate irrigation to reduce diseases. It also includes removing or pruning infected plants, cleaning up rubbish and disposing plant debris which can harbor pests and diseases. Planting times The farmers need to plant early or late to avoid times when the pest or disease is most common.
3. Organic plant protection method

The cooperative society would be creating a healthy balanced farm ecosystem in which pests and diseases do not cause problems. The cooperative society will never allow or encourage the farmers to use artificial chemicals to control pests. The farmers will be educated on the use of a range of natural insect repellent sprays like: Soap sprays made out of bath soap and oil. Lemon grass oil Garlic spray Chive spray Baking soda spray Horsetail spray Compost tea spray

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The members of Gedu Farmers Co-operative Society will be fully engaged in the production of organic vegetables which is gaining popularity. Co-operative society will work in collaboration with the ministry of agriculture. The Farmers Cooperative Society would call the specialists from RNR centers to educate the farmers on the ways and methods to cultivate organic vegetables. Gedu Farmers Co-operative Societys vegetables will be different from the vegetables from India in terms of nutritional values and freshness.

5.8 Pricing: The pricing of the various products made available by the Gedu Farmers Cooperative Society will be on the basis of prevailing market price in the major markets across the border. The demand and supply will determine the pricing strategy from time to time. Information to the Farmers: The Gedu Farmers Cooperative Society will display the information relating to the prices of various products as prevailing in the nearest major agricultural markets for the information of farmers. This information is to be updated on weekly basis. The society will also make available all information which shall have an impact on the production by the farmers.

5.9 Human Resource: Human resources are very important for an organization; the success of every organization depends on the strength of its human resources. Initially the manpower required by the Co-operative Society would be as follows: Sl.no Job specifications Qualification
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Number of slots

Gedu Farmers Cooperative Society

1 2 3

Manager Accountant Sales person

Class 12th pass and working experience Diploma in accounting Class eight passed with good communication skills.

1 1 2

Vegetable collector Class eight passed with good communication skills. Only male.

5.10 Estimated Sources and Uses of Funds: Since during our survey majority of the farmers have shown their interest the budgets are drawn on the assumption that at least 500 members from the Bongo Gewog will join the cooperative society. Sources of Funds: Capital: Nu. 5, 00,000. (Each Member will purchase a maximum of 10 shares of Nu. 100 each). Loan from Bank: For Purchase of Vehicle Nu. 3, 00,000. Revenue: Monthly Subscription: Nu. 50,000 (Each Member contributes Nu.100 per month) Revolving fund Contribution: 10 Per cent. (Revolving fund is added to the surplus for distributing after due allocations) Uses of Funds: Capital Expenditure: 1. Formation Expenses: Nu. 10,000. 2. Purchase of Vehicle for Transportation: Nu.6,00,000 Revenue Expenditure:

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3. Payment of Salaries: Nu. 15000 per month approximately. 4. Interest on Loan and Installment: Nu.10000 approximately. 5. Rental Expenses: Nu. 3000 per month approximately. 6. Other Incidental expenses including transport cost: Nu. 10000 per month approximately. Balance of Revenue funds: Nu. 12000 Note: Tabulated monthly fund flow statements at appendix V

Chapter six Findings

As per the survey, farmers produced almost all types of vegetables sold by the shopkeepers in Gedu Township. The supply of vegetables is more than the demand of Gedu Township. The Gedu Farmers Co-operative Society could market the excess vegetables to the nearest market.
In sample of 60 customers who go for buying the vegetables, they have four choices

where they could do their shopping. Most of the buyers are local residents and government workers. They mainly go for shopping in Zero market. On an average basis most of the student as well as lecturers also go for shopping in Zero market. This is a good opportunity to start Gedu Farmers Cooperative Society because it will be situated there and the current vegetable market is situated in Zero. According to the data collected, majority of the respondents purchased vegetables from the zero market. This acts as a feasibility for starting up Farmers Cooperative Society in Bongo Gewog because as mentioned above that a good vegetable market is already made to use in Zero. Farmers of Bongo Gewog practiced traditional methods of farming. They didnt have any ideas with regard to modern methods of farming and they carried out the farming methods passed onto them by their forefathers. This is one of the reasons cited by the farmers for low yield.
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Almost all the farmers of Bongo Gewog cultivated organic vegetables and they produced vegetables on a very small scale. Farmers of Bongo Gewog didnt have access to any chemical fertilizers and at the same time lacked the knowledge of protecting their vegetables from pests using naturally made fertilizers. That was one of the main reasons for low yield from their fields. The customers of Gedu Township felt that the farmers are not producing enough vegetables to fulfill their needs. Majority of the farmers directly sell their produce to the shopkeepers so the respondents feel that the vegetables that the farmers sell to the shops are imported from India. Customers see only a handful of farmers selling their produce on their own, so the customers feel that the farmers are producing minimal amount of vegetables. Customers also feel that the local vegetables are fresh and healthy.
Most of the vegetables are sold by the shopkeeper in Zero market and few in Laptshakha.

But the main problems with these vegetables are non-freshness and they are costly. Survey says that sometimes the vegetables are out of supply and the customers have no choice in buying the old stock. These problems are mainly created by the road inaccessibility when landslides occurs blocking the highway for two to three days. As per the survey, customers prefer buying from the Gedu Farmers Co-operative Society which will be more fresh and organic in nature. Also there will be timely supply of the vegetables with organized marketing and transportation facility.
The average of farmers monthly earnings is Nu 1408 which is very low. The farmers

also dont have any other income other than the sale of crops and vegetables from their fields. So the Farmers Co-operative Society would help these farmers increase the earnings from the sale of crops and vegetables.

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Chapter Seven Conclusion

In general, this project has given us broader view of a cooperative society. We are made to explore the reality of commencing a business and the various considerations that as an entrepreneur requires. This project is purely based on the primary data where the research team had lively interaction with the farmers of Bongo Gewog, the customers, and the best part of this project is that Gedu Farmers Co-Operative Society is looking for a way to develop the living standards of the farmers of Bongo Gewog. The response from the farmers and customers are positive and encouraging, which has increased the hope of starting up a Farmers cooperative society in Gedu. As per the study, it is feasible to form a cooperative society as most of the farmers are willing to join the cooperative society. On the other hand, customers have also shared some of their experience of price discrimination for same produce from different shop and also about the untimely supply. And moreover, the Gedu Farmers Co-Operative Society will take advantages of the vegetable market in Zero market which has been idle for years, for which government had invested a huge amount. Gedu Farmers Cooperative Society will be helping the members of the co-operative society and the communities fulfill their financial needs and demands. The Gedu Farmers Co-operative society will be formed in line with the requirements of The Co-operative Act of Bhutan, 2001. All the farmers of Bongo gewog will be the members of the Gedu Farmers Co-operative society. Gedu Farmers Cooperative Society will ensure the timely collection of agricultural products from the farmers and make it available to the nearest market. The farmers will be paid weekly on the basis of the quantity supplied by them to the society at a fair price. The Gedu Farmers Cooperative Society intends to adopt the By-laws and the constitution as provided in The Co-Operatives Act of Bhutan, 2001.

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Reference

Maheswari. R.P A complete course in ISC Commerce Volume I Piyush Printers Publishers Private Ltd, New Delhi

The Shore Porters Society: About Us- Our History, 2007, retrieved 6 May 2008) Doug Peacock. Social strife: The birth of co-op. Cotton Times, understanding the industrial revolution.p.3. Retrieved 2008-06-26)

Cobia, David, editor, Cooperatives in Agriculture, Prentice Hall, Englewood Cities, (1989,) P.50

John M. Staatz, Farmers incentives to take collect action via Cooperatives; A transaction- cost approach, in: Cooperative theory: new Approaches, ed. J.S. Royer, Washington,D.C: USDA ACS Services Report 18(July 1987). PP.87-107

National Statistical Bureau, Statistical year book for 2009 National statistical Bureau, National accounts for 2009 Royal Government of Bhutan, The cooperatives Act of Bhutan, 2001

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Appendix I
Interview questions for farmers 1.What is the total area of land used for growing vegetables (10 items) 2.What is the quantity of different vegetables that you grow:

Sl.No

Common

types

of Average produce of total house hold weekly 1134 bundles 2062 kgs 618 kgs 309 kgs 206 kgs 258 kgs 155 kgs 309 kgs 103 kgs 309 kgs

vegetables produced 1 2 3 4 5 6 7 8 9 10 Spinach Potato Chili Beans Cabbage Tomato Brinjal Radish Onion Cauliflower

3.Do you grow vegetables as per the change in the season? 4.Do you grow vegetables for Market purposes? Yes 1 No 2 5.Where and how are the vegetables sold? 6.What is your weekly income from the sale of vegetables? 7.What kind of farming methods do you follow? Traditional (1) Modern (2) Mixed (3) 8.Do you cultivate organic vegetables and non organic vegetables? Organic (1) Non-Organic (2) 9.Does the government provide any help in carrying out farming activities? 10. What difficulties do you face in selling the vegetables on your own? 11. Do you have cooperative society? 12. Would you like to be a member, if a farmers cooperative society? 57

Gedu Farmers Cooperative Society

13. What is the distance from your place to the Vegetable market, where you sale your vegetable? 14. How do you transport your vegetables to the market? 15. Do you get any assistance from the government for growing vegetable for market purposes? 16. If yes, how and in what form?

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Appendix II
Interview question for Shopkeeper 1. What is the quantity of the vegetables (given below) you order per Week: Types of vegetables
Spinach Potato Chili Beans Cabbage Tomato Brinjal Raddish Onion Cauliflower

Weekly supply (in Kg)

2. From where you get these vegetable? India (1) Local (2) 3. If you choose No 1 above, what is the region behind it? Price (1) Regular supply (2) Convenient transportation (3)

4. Do the farmers (Gedu) supply vegetable to your shop? 5. If yes, what is the advantage of it over the importing from India? 6. If no, why?

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Appendix III Questionnaire: (For the Customers)

Dear Sir/Madam, We, the BBA VII Semester students, are conducting a Research on the topic cooperative society (An Analytical Study on the demand and supply pattern of vegetables in Gedu) in fulfillment of our module no 705. Therefore, we request all the respondents to kindly fill up the questions given below and suggest your opinion. 1. Where do you buy your vegetables mostly from? a) Laptsakha market( ) b) Farmers( ) b) zero market( ) d) others( )

2. Do you think that local farmers are growing enough vegetables to meet the demands of the Gedu residents? a) Yes ( ) b) No ( ) c) No idea ( )

3. What specialties do you find in local vegetables?(can tick more than one) A) Healthy c) Local product b) Fresh d) Organic e) others (specify).

4. Do you feel the need for a proper vegetable market in Gedu? a) Yes ( ) b) No ( ) c) No idea ( )

5. Why do you think there is decline in the consumption of vegetables grown locally? a) costly b) Less supply c) Not in good shape d) Others (specify)..

6. Do you think that by buying vegetables from the local farmers, you are helping them to become self sustainable? 60

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a) Yes ( ) b) No ( ) c) No idea ( )

7. Do you think that vegetables supplied from different places retain their freshness by the time they reach Gedu? a) Yes ( ) b) No ( ) c) No idea ( )

8. Cooperative societies play a vital role in the development of the community and the nation at large? a) Strongly agree ( ) d) Disagree ( ) b) agree ( ) c) Dont know ( )

e) strongly disagree ( )

9. What kind of benefit you think you will get when the current vegetable market in Gedu will start functioning? a) Get Fresh vegetable b) Cheap vegetable d) All of them c) Healthy vegetables

d) others (specify)..

10. What is your view on starting a farmers cooperative society in Gedu?

Appendix IV Types and quantities of vegetables produced by villagers of Bongo gewog

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Gedu Farmers Cooperative Society

Sl. No

Common types vegetables produced

Total farmers (A)

Average 50

Average of of 536

produce Average (total produce total (C)/52 1134 bundles 2062 kgs 618 kgs 309 kgs 206 kgs 258 kgs 155 kgs 309 kgs 103 kgs 309 kgs of house

of produce of 50 produce annually

farmers household) (B)*536 = (C) 58960 bundles 107200 kgs 32160 kgs 16080 kgs 10720 kgs 13400 kgs 8040 kgs 16080 kgs 5360 kgs 16080 kgs

farmers annually hold weekly

(A)/50 =(B) 1 2 3 4 5 6 7 8 9 10 Spinach Potato Chili Beans Cabbage Tomato Brinjal Radish Onion Cauliflower 5500 bundles 10000 kgs 3000 kgs 1500 kgs 1000 kgs 1250 kgs 750 kgs 1500 kgs 500 kgs 1500 kgs 110 bundles 200 kgs 60 kgs 30 kgs 20 kgs 25 kgs 15 kgs 30 kgs 10 kgs 30 kgs

Appendix V
Estimation of Annual Fund Flow Statement Sources of Funds: Amounts Uses of Funds:
62

Amounts

Gedu Farmers Cooperative Society

in Nu. Members share capital Loan from Bank Members Nu.100 each) monthly 6,00,000 5,00,000 3,00,000 Formation Expenses Purchase of Vehicle for transportation Salaries payment Interest on Loan and Installment Rent expenses Other incidental expenses Increase in working capital

in Nu. 10,000 6,00,000 1,80,000 1,20,000 36,000 10,000 4,44,000

subscription (500 members *

14,00,00 0

14,00,000

63