The Bamboo and Rattan Sectors in Asia: an Analysis of ... - INBAR

The PCS
The main market participants are:
● State Forest Department
● Bamboo cutters
● Bamboo weavers
● The Kerala State Bamboo Corporation Ltd. (KSBC)
● Private traders
The bulk of the reed bamboo used in mat weaving grows in state-owned forest
lands. The Forest Department allocates bamboo cutting rights among three corporate
entities: Hindustan Newsprint Ltd. (HNL), Grasim Industries (also a pulp company)
and KSBC. In addition, cutting rights are assigned to bamboo workers living within
5 km of the forest boundary under rules and conditions meant to protect the resources
from overexploitation.
Thus, there are three legal channels for extraction of the resource. "Head-load
passes" are made available to individual bamboo workers for their own consumption
or for sale to KSBC. The industrial sector use wage laborers to cut quota allotted to
them. For example, HNL operates through 50 contractors for their reed supply. The
contractors hire cutters, and issue them with cutting passes obtained from the Forest
Department. Sometimes advance payment is offered to attract cutters. HNL is liable
for offenses committed by the cutters, and maintains several zonal offices to monitor
the cutting activities. Contractors may be fired for poor performance.
KSBC issues passes to cutters who supply a minimum of Rs 1 000 worth of reeds
per year (US$1 = Rs 35.86). However, during some seasons when cutters are occupied
elsewhere, this threshold may be reduced to as low as Rs 200. It stipulates that cutters
should respect forest laws. Photo passes are issues for a period of three years.
Violations of cutting rules can be punished by revoking or by not renewing the pass.
The registered cutters transport their reeds to one of several reed collection centers
(RCCs). There are five RCCs in the Angamaly cluster. The RC supervisor is responsible
for grading and pricing reeds, paying wages to cutters, dispatching workers and
transport, organizing passes from the Forest Department and selecting cutters.
Pricing is highly discriminatory: industrial consumers pay Rs 0.10/reed while
traditional craft workers pay Rs 0.50/reed.
This complex system suffers from resource allocation problems. It is intended
that cutting passes be issued to genuine bamboo workers. Cutters have to prove that
they are genuine bamboo workers by showing that they have cut bamboo worth at
least Rs 3 000 in the previous year in order to qualify for a pass. As it is necessary
to have a pass to cut bamboo, this rule effectively prohibits the entry of new workers.
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