1 million chulhas

Well, the last week was marred by the "Racist" row between the Indians & the Aussies. The newspapers, websites and the audio visual media just added fuel to the fire. There was of course an issue to be made for that. We are not a nation that takes such allegations lightly given that we ourselves have had to face the situation in the past. Nobody knows what happened. But its not that it doesnt happen in our country. Ask any North Indian who visits South India and he will tell you horriffic tales of the way the South Indians treated them which will put any Southie in North to shame. Not to say that our brothers from the Northern hinterland are any better. I, myself, have had to face them on numerous occassions. But then, you have to look at the larger issue at hand. Some of my cousins didnt take it too well & could only recoup when they found familiar faces (though with slightly idiosynchratic ideas about life). We can never escape it. We must accept that certain segments will always try to make you realise that you are different from them, but the intent must not be demeaning in any manner. Again, given that most of us are insane & insecure such thoughtful event would be a rare occurance.

Last week, one of my crazy searches landed me with a company called "Hi-tech Agro". The promoter happens to be one person called Mr. A K Khater. Upon meeting him, I realised that he was a stalwart of "briquetting and pilleting of Bio-waste". For some of our less aware friends, Bio-waste is not human waste, but rather the residue from farming harvest. In some cases it also includes household waste, waste wood material & other bio-degradable waste. Now briquetting as the name sounds relates to compacting of bio waste and making it in the form of bricks. Pilleting means making small bullet like structures out of Bio waste. To me it was as exciting as a teenager missing a heart beat on meeting a prospective sweet heart. And more so, I was intrigued by his enthusiasm on making it reach the remotest villages of India. He wanted to give something back to them. Whats the use of the 9% rate of growth, when the riches continue to throng the city dwellers, who are just making life difficult for themselves in their pursuit of quenching the thirst for luxury? So, what was the concept? Well, here it goes. In villages, the dwellers use the bio waste for household purposes like you know burning them for cooking food and heating purposes. Now these villagers do not use any efficient chulhas. They just burn the waste & over them place the vessel to be heated. Now, there are many hazards associated with such an exercise. One, this bio waste is not processed which means burning them leads to more smoke than real heat. This poses a health hazard to the user, but also consumes a lot of time. In some cases, wood from nearby forests are cut to burn the chulhas. Also, the bio-waste isn't basically a product that is of much economic significance to them. So, the better way is to use them to burn them to make food.

Mr. Khater, the pioneer in briquetting & pilleting of bio-waste, has hence thought of installing one million chulhas (on a pilot basis) that will allow villagers to use bio waste in a more efficient manner for more or less the same purpose. Now, here is the deal on offer. Firstly, a "Group operator" will be appointed for each zone/ state. Each of these zonal/ state level operators can appoint one operator who will be taking care of say 80 - 100 villages. Each of these smaller operators will own a briquetting & pilleting machine for treating the bio-waste. The villagers will give their bio waste to these operators. The operators will return one-third (by weight) of the bio waste submitted by the villagers back to them in the form of a briquet or pillet. The remaining pilletted bio waste is then sold in open market where there are ready buyers for them. These buyers in some cases own their own captive power generating capacities for which they badly need the raw material. Now, as far as the villagers are concerned, they also get a chulha from the village level operator. These chulhas are much easier to operate. More importantly these chulhas burn the bio waste more efficiently ( am no science geek, but they say it can burn the fuel inclusive of coal & wood efficiently by over 45% - 50% as compared to your traditional chulha) causing less environmental pollution and less health hazard.

Who will bell the cat? This was the question I asked Mr. Khater. To which he invited me to a brain storming session at "Batkal Lake" in Faridabad. I had been there earlier. Flanked by mountains, it used to be a scenic lake with a hovercraft facility. I am talking of at least 13 years to 14 years in the flashback of my life. Depreciation is another fact of life which is hard to ignore. "Batkal lake" wore a sad look. Thoroughly molested by apathy of local authorities and raped by human inhabitants around it, I was disheartened. Given that it is maintained by Haryana Tourism just underlines the importance we give to tourism in our country. Much to my excitement, I reached the venue much before my host. Whenever, I reach early for an appointment or am waiting for a person for a meeting, I am reminded of a very interesting definition of "Punctuality" - Punctuality is the art of waiting for those who are unpunctual.

We were a gathering of about 15-16 people. Most were from the same field as Mr. Khater, but were more or less leaders in their regions. So, when the discussion started it hit a road block on the financing part & more importantly the ownership part of it. For a long time I listened to the gyaan being imparted on environmental conservation & the inherent strengths of the project etc. etc. etc.But when I took it no more, I stamped my hand on my table ( not exactly, I just interrupted one of the speaker who was repeating the same point), and said, "Excuse me gentlemen, in the absence of funding from Government, how are we going to make this a viable project?" Thats when everybody agreed that they were missing a crucial point. I mentioned that debt in no option for them . Given that returns are still uncertain & there could be a substantial gestation period, till the project becomes viable taking upon a fixed liability will spell doom from Day 1. The project must be self-sustaining & must have an equity partner as far as the funding is concerned. I told them that they must float an SPV for this purpose. In this SPV, each "Group Operator" will necessarily be an equity partner. What can then be done is that based on demand from each of their regions, they could set up manufacturing facilities and could seek funding from the SPV. The SPV could then assist in either direct contribution to the project or can access Banks. Incase of a substantial equity contribution, debt might come cheap (I was also given to believe that certain Banks had shown interest in funding the project at a subsidised rate). Another point was that since, the chulhas were efficient burners they could also invite funding by way of Carbon Credits. Personally, I am vehemently against the concept of Carbon Trading. But then for a noble cause, what the heck??

One thing that yet remained unaddressed, was the ownership of the briquetting machines at the village level. Will that be owned by the goup operator or the village level opertaor or the village head or a SHG? But then the group Operator wont be able to benefit from the sale of the two-thirds of the bio-waste. Whoever is owning it will also have to bear the cost. Under the scenario of inadequate revenue streams of villagers, the role of micro-financing agencies will be pivotal. My suggestion was to de-couple the ownership of such machines & sell them to village based operators. Our SPV makes money by selling these machines to village level operators who are financed by micro-financing agencies. These village level operators make money by selling the pilletted Bio waste. Our SPV also makes money by selling the more efficient chulhas to the villagers. We can distribute them for free as well, because the more operating chulhas there are, the more carbon credits you earn and the more faster your project becomes viable. The villagers get a more effcient chulha that uses less fuel & causes less smoke.Voila!!!!

Towards the end of the meeting, Mr Khater told me, "Deepak, I pray to God that this project must be successful. We will need all the help from you". I replied, "Khater saahab, it seems your God has gone on a Long Holiday & he seems to have misplaced his cellphone as well. I guess, we are to help ourselves and more importantly the villagers will be our gods if there is going to be any involvement of divinity at all."