Diversifying Community Forest Benefits: Zhasela Community Forest

Here are the stories of three farmers in Lhuentse- Sonam Norbu, Tshewang Rinzin and Tshering Dorji who have benefitted from being members of a Community Forest Management Group.

Sonam Norbu: With the bringing of a maize grinding machine by Sonam Norbu, his village of Bragong under Minjay gewog in Lhuentse will soon reverberate with the roaring sound of the engine of the machine. The arduous task of grinding maize to kharang in the traditional method will soon be a thing of the past.  Time will soon come to bid adieu for the traditional method of grinding maize. The traditional method of grinding maize claimed more time and labour when it is already an acute shortage in the farm. The overall procuring, transportation and installation aspects will be facilitated by the concerned agencies.

Tshewang Rinzin: On the way to Lhuentse from Mongar, the cluster of glittering houses of the village on the lap of the mountain that gradually falls down  to the right bank of Kurichhu river  is a stark reminder that the village is prospering rapidly en route to deleting poverty from their dictionary. If wealth or the living standard of the people is measured in terms of whether one’s house is roofed with CGI or not, Bragong village will fare very well. Now, in the clear summer sun, the village will glitter more and reflect more sign of prosperity with the inherited house of another resident, Tshewang Rinzin soon to be roofed with CGI (Galvanized iron sheet).

Tshering Dorji: The cattle of Tshering Dorji will not only be able to forage quality but also year round grass. With fencing to be carried out soon with barbed wire, the existing pasture will be improved and maintained properly. This way his lactating cows will produce more milk for not only home consumption but also for sale in varied products. The pasture seeds and technical backstopping will be rendered by the relevant technical person.     

Although, the stories narrated above are the stories of three different people investing in three different ventures, all three have one thing in common. All their investments have been made possible with credits made available from the funds generated by the Zhasela Community Forest. They are all active members of the Community Forest Management Group. The Community Forest fund lending scheme, whereby the CFMGs are given the opportunity for accessing the low interest credit facility is the main attributes to such enterprise. This indicates, given the easy access to credit facility, farmers are willing to invest in activities spearheaded towards poverty reduction.    

Since the access to credit facilities is a major bottleneck in rural areas even if one is willing to take up innovative ventures, CF fund lending scheme attempts to resolve such problem. The loan sharks in the villages robbed them of their miniature monetary strength, compelling them to slide further down the poverty ladder. The CF fund lending scheme is an initiatives of the CFMGs to revolve the CF generated fund rather than hoarding it in the bank. The CFMGs can avail the maximum of Nu.50,000/- soft loan from the CF fund at the nominal interest rate of 5% per annum. The installment can be deposited in their convenience. However, the installment should not exceed or delay too long.

As of now, two CFMGs has availed the highest ceiling of Nu.50,000 each reason for which are mentioned in tabular presentation below. The lowest amount credited is Nu.3000 for buying basic household necessities such as cooking oil, salts and clothes. As of now, the total of Nu.1,97,000 has been disbursed as CF fund lending to the CFMGs. Within one year, these will fetch an interest of Nu.10,710. However, interest isn’t the ruling rationale behind such scheme. The bigger principle was opening up door for easily available credit service at doorstep. 

     

The overview of the lending till date is presented below: 

Name of lender	Principle Amount (PA)	Interest rate % (IR)	Annual interest (AI) PAxIR/100	Total Amount (PA+AI)	Reason for lending money
Tashi Wangchuk	50,000	5	3500	53,500	Construction of new house for his family
Thinley Namgay	50,000	5	3500	53,500	Set up a retail small shop in the village
Sonam Norbu	40,000	5	2800	42,800	Procure new maize grinding machine
Tshewang Rinzin	25,000	5	1750	26,750	CGI roofing of his house
Tshering Dorji	10,000	5	700	10,700	Barbed wire for fencing the boundary of his pastureland
Sonam Dorji	5,000	5	350	5,350	For personal use
Tashi Chedrup	7,000	5	490	7,490	Repayment of loan availed from other loan sharks
Pema Tshewang	7,000	5	490	7,490	For buying household necessities
Pelden Dorji	3,000	5	210	3,210	For buying household necessities
Total	1,97,000	5	10,710	2,07,710

The need for an appropriate by-law has been deemed important with commencement of such service by the Community Forest. This framin of the by-law is aimed towards minimising or reducing the loan defaulters, thus ensuring the sustainability of the CF fund.  The formulation of the by-law will also ensure that there is equity in availing such lending among the CFMG members. The drafting of such a by-law has been facilitated by the Gewog Forest Extension/Dzongkhag Forestry Sector in order to streamline and regularise such lending. The scope of expanding the loan to non-members is also being revised and need to be inculcated in the by-law.

All the decisions and consensus in this regards has been taken or reached by the CFMG themselves during the annual general and work planning meeting. The Dzongkhag forestry staff is restricted to the facilitation service only.