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Fair Trade helps eradicate poverty: Mallikarjuna
By d-sector Team

Fair Trade as an idea and a movement has begun to take roots in India. Fair Trade Forum-India is a large network of fair trade grassroots organisations of the country. I. Mallikarjuna, Executive Director of Fair Trade Forum-India, in his interaction with d-sector.org, shares information about ideology, actions and organisations behind the Fair Trade Movement.


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I. Mallikarjuna, Executive Director of Fair Trade Forum-India

Q. To begin with, kindly tell us about the concept of Fair Trade.

A. See, Fair Trade is basically a trading partnership, based on transparency and mutual respect, that seeks greater equity in international and domestic trade. It contributes to sustainable development by offering better trading conditions to, and securing the rights of, marginalized producers and workers - especially in the Southern Countries.

Fair Trade organizations have a clear commitment to Fair Trade as the core principle of their mission. Backed by consumers, fair traders are engaged actively in supporting producers, in raising awareness and campaigning for changes in the rules and practices of conventional international trade.

However, Fair Trade is more than just trading: it proves that greater justice in world trade is possible and shows how a successful business can also put people before profit.

Q. Is it a relatively new concept or it has evolved from sustained movements?

A. It is not a new concept. In fact many parallel initiatives in the world converged to launch Fair Trade movement.

It all started in the United States, where ten thousand villages (formerly Self Help Crafts) began buying needlework from Puerto Rico in 1946 and SERRV International began to trade with poor communities in the South in the late 1940s. The first formal "Fair Trade" shop opened in 1958 in the USA.

In Europe it began in the late 1950s when Oxfam UK started to sell crafts made by Chinese refugees in Oxfam shops. In 1964 it created the first Fair Trade Organization. Parallel initiatives were taking place in the Netherlands and in 1967 the importing organization, Fair Trade Original, was established.

At the same time, Dutch third world groups began to sell cane sugar with the message "by buying cane sugar you give people in poor countries a place in the sun of prosperity". These groups went on to sell handicrafts from the South, and in 1969 the first "Third World Shop" opened.

During the 1960s and 1970s, many NGOs and individuals from Asia, Africa and Latin America felt the need for fair marketing organizations to help the disadvantaged producers. Many such Southern Fair Trade Organizations were established, and links were made with the like-minded organizations in the North.

"Fair Trade is more than just trading: it proves that greater justice in world trade is possible and shows how a successful business can also put people before profit."

Parallel to the citizens' movements, the developing countries put forth their demand for "Trade not Aid", in the second UNCTAD conference in Delhi in 1968. The emphasis was put on the establishment of equitable trade relations, instead of North appropriating all the benefits and returning only a small part of these benefits in the form of development aid.

From the late 60s onwards the growth of Fair Trade, or alternative trade as it was called earlier, has been associated primarily with development trade. Some development and religious agencies from European countries put the focus on marketing the craft products from the South as a response to poverty and sometimes disaster. These NGOs, in tandem with their counterparts in the South, assisted to establish Southern Fair Trade Organizations to organize producers and production, provide social services to producers, and export to the North. Alongside the development trade there was also a branch of solidarity trade.

During mid 70's all these Fair Trade Organizations started to meet occasionally and in late 80's International Federation for Alternative Trade, (IFAT) was initiated. Then WFTO-Asia at the Asian level and Fair Trade Forum was established as the National forum in the year 2000.

Fair Trade activists taking part in a global march

Q. How did World Fair Trade Organisation come into being? Was it created as an antidote to WTO, which failed to provide sustainable development to the world?

A. Actually, the World Fair Trade Organization (WFTO) was formerly known as IFAT. The WFTO was born out of the International Fair Trade Association on 15 October 2008 as a well considered response to the extraordinary issues of our time: the failure of global bodies to impact the imbalance in trade, the failure of governments and businesses to tackle climate change and the failure of the global financial system.

Today, WFTO is a global representative body of over 350 organisations committed to Fair Trade. It aims to enable producers to improve their livelihoods through Fair Trade. It provides market access for its worldwide membership through policy, advocacy, campaigning, marketing and monitoring.

Today WFTO operates in 70 countries across 5 regions: Africa, Asia, Europe, Latin America, and North American and the Pacific Rim. It is the only global network whose members represent the Fair Trade supply chain from production to sale.

"World Fair Trade Organisation has shown that trade can be an effective tool for poverty alleviation if 'fairness' in the trade is ensured."

Q. Tell us more about WFTO's organisational set-up?

A. The WFTO has a well structured organization. Its Board of Directors is responsible for developing and implementing the plans agreed by the members at the Annual General Meeting.
Each region is represented by its own elected Board members. The Board members act as a point of contact for members in each region, and are involved in the co-ordination of the members' National and Regional platforms.
WFTO members are organisations committed to Fair Trade by eradicating poverty, pioneering social and environmental policy and continual reinvestment in marginalised producer communities.

Q. But do you think WFTO is relevant in a world becoming increasingly corporatized dominated by modern technologies connecting the world?

A. I think it is more relevant than ever. Globalization has brought many opportunities along with many more challenges. WFTO has shown that trade can be an effective tool for poverty alleviation if 'fairness' in the trade is ensured.

Q. India's socio-economic condition is vastly different from the developed world, where the concept of Fair Trade originated. How does Fair Trade Forum-India attempt to make it useful here?

A. This is an interesting question to understand the relevance of Fair Trade in India. Though the popular perception is that Fair Trade concept originated in the West, it is interesting to know that Asian countries played an important role in structuring and strengthening the Fair Trade movement.

The Fair Trade movement had its inspiration from Gandhian principles of self reliance, self empowerment and emancipation. It aims to reduce poverty by ensuring the participation of the marginalized artisans and small farmers in the global trade on an equitable basis. The consumer consciousness in the West matched with the aspiration of the producers from the Southern countries to initiate the movement.

India has a special role in strengthening the movement including evolving Fair Trade principles like creating opportunities for disadvantaged producers, payment of fair wages, gender equity, protection of child rights, better working conditions etc.

Artisans and women's SHGs get the market through Fair Trade movement

Q. What major activities FTF-I undertakes in India?

A. Fair Trade Forum-India is a national network of the artisans, producer groups, trading organizations and intelligentsia who believe in fair trade.
It represents its member organizations & federations all over India to grow Fair Trade visibility & standards through advocacy, training, monitoring & certification. It also works to facilitate producers' capacity building for better market access. FTF-I also stands for a united global Fair Trade face and supports the international Fair Trade movement.
Registered in the year 2000, at present FTF-I is working with more than 90000 artisans/ producers through our 75 Fair Trade organization members. Its board comprises of seven elected representatives from all over India.

Q. What are the criteria for membership to FTF-I?

A. The membership is open to all eligible NGOs, Trusts and Cooperatives, firms, producer and marketing organizations subscribing to the objects and rules of the Forum. Individuals can seek associate membership but cannot become a full-fledged member of the Forum. A minimum three years existence in their respective area of working is required for getting membership of FTF-I.

Q. Other than trade, what are the main issues FTF-I is involved in?

A. FTF-I's mission is to eradicate poverty by creating visibility, acceptability, adaptability, marketability and sustainability to Fair Trade movement and its member organizations in India.

Q. Does FTF-I work in isolation or in association with other organisations?

A. FTF-I works in close collaboration with many national and international organizations including consumer networks, MFIs, livelihood promoting organizations, government departments, management institutions, colleges and social entrepreneurs. In fact 2010 is the year of collaborations for FTF-I and we will be entering into more collaborations this year to make Fair Trade more visible, credible and acceptable in India.

Q. What are the challenges and opportunities of working in development sector in India?

A. Development sector is very vibrant in India and in fact many purposeful initiatives are in place. However, the sector needs convergence of ideas, thoughts & leadership. Inclusive Development, Sustainable Development and Livelihood Promotion of the marginalized need to be realized in action and Fair Trade can been seen as an effective tool in achieving this. As of now Fair Trade organisations are more export oriented and this year onwards we will witness many Fair Trade initiatives in India.

Besides the other common challenges, FTF-I's biggest challenge is to communicate with Indian consumers in an appropriate way about the necessity to buy fairly traded products and also to demonstrate the grassroots producers that their aspirations will influence the buying power of the emerging middle class in India.

Write to d-sector  |  Editor's Note

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Socio-Economic Development  > Social Welfare > International Policies and Programmes
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Corruption Watch

The bad news is that corruption has not only sustained but has grown in size and stature in the country. With scams being a regular feature, seventy per cent respondents in a survey have rightfully opined that corruption has continued to increase in India. One in every two interviewed admit having paid a bribe for availing public services during last one year. Transparency International's latest survey reveals that the political parties top the chart for the most corrupt public institutions, followed by police force and legislatures. No wonder, India continues to make new records on the global corruption arena!

The shocking revelation is that the health and education sectors haven't remained untouched by this phenomenon. With 5th and 6th positions respectively for these sectors on the public perception chart on corruption, corruption has crept insidiously into these sectors of hope for the masses. With bureaucracy being fourth in the list of corrupt institutions in the country, corruption seems to have been non-formally institutionalized with little hope if public services would ever be effective in the country. With economic growth having literally institutionalized corruption, are we now expecting corrupt to be socially responsible - a different CSR.

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Not giving 'aid' to India is one thing but calling it 'rich' is quite another. If one in three of the world's malnourished children live in India, what does average daily income of $3 indicate? It perhaps means that there is a relative decline in poverty - people are 'less poor' than what they used to be in the past. But having crossed the World Bank arbitrary threshold of $2 a day does not absolve the 'developed' countries of their obligation to part with 0.7 per cent of their Gross National Income in development aid. Should this three-decade old figure not be revised?  

An interesting debate in UK's House of Commons delved on future of development assistance by the British Government. While prioritizing limited resources has been a concern, there has been no denying the fact that development aid must be guided towards tangible gains over a short period of time to start with. There are difficult choices for elected governments to make - should they invest in long-term primary education or in short-term university scholarships? Which of these will bring gains and trigger long-term transformation in the society. As politicians continue to be divided on the matter, poverty persists!!   

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