Bring Home The Precious!

(Freshwater Pearl Farming)

FRIDAY, 31 DECEMBER 2010 00:00 SHINJINI GANGULI OPPORTUNITIES - AGRICULTURE & RURAL

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Poor Best Freshwater pearl farming is a profitable venture that can reap up to 200 per cent profit with no tax deductions. Anyone interested? Read on to know about various aspects of pearl farming.

Pearl farming, a lesser known practice, but certainly a lucrative business, unfortunately, hasnt caught the fancy of Indian entrepreneurs as yet. Predominatly so, due to lack of awareness and technology.

In the absence of any takers willing to breathe life into the pearl producing oysters, India, which was once known to produce the finest oriental pearls, imports pearls worth $ 4 million every year now. After pearl fishery was stopped in India four decades ago, as a step to put a check on the depleting resources of natural pearls, production of pearl came to an apparent halt while countries like China, Japan, Australia, Tahiti and Indonesia, the biggest producers and exporters of pearl, took to pearl culture in a big way. In fact, pearl culture is one of the main cultivations in China and Japan. Of late, the practice of freshwater pearl farming has been gaining belated acceptance in India. A few have come up on the horizon. And leading the pack is, Ravikiran Bhatt, a pearl farmer and the only pearl consultant in India, from Malavalli, a village in north Karnataka. He ventured into this business three years back and was the only pearl farmer in the whole of Karnataka back then. In three years I have come a long way. From a farmer to a consultant, I have a client base of 28 clients across several states of India and foreign countries like Maldives, Malaysia, Singapore, etc. Ravikiran, Chairman, Ravikirans Freshwater Pearl Culture Research Centre and Yashas Consulting Services, accidently landed up in this business when an astrologer told him that pearl farming could open the doors to fortune for him. Enthused by the astrologers prediction, he went to China to learn the technique of pearl farming. He got his degree in MFSc in pearl farming, from the Freshwater Fisheries Research Center CAFS (FFRC), Wuxi, Jiangsu, China. He also visited the Central (CIFA), Bhubaneshwar and the Central Marine Fisheries Research Institute (CMFRI), Kochi and got the necessary training from experts. Additionally, he gathered information from the internet and gained knowledge on various methods of pearl cultivation in detail.

With all the information in his kitty, he started experimenting. And after a couple of failed attempts he finally tasted the long-awaited success. Today, he is sitting pretty on an annual turnover of Rs 40 crores, which is a magnificient figure considering he started with just Rs 4 lakh three years back. For the figures it generates, freshwater pearl farming involves a relatively simple procedure that can be easily replicated by anyone, anywhere. The biggest advantage being that entrepreneurs can start this even within the territories of their houses. Replicating Nature A natural pearl is formed when some form of irritant lodges itself into a mussel (freshwater oyster). To protect itself from the irritant, the mussel secretes a fluid to coat the foreign element. And over a period of few months or a year or two, layers of coating are formed on the irritant and thus a lustrous pearl is formed. Pearl is basically calcium carbonate deposit within the soft tissue of shelled oyster. However, pearl formation procedure is different in cultured pearls. In freshwater pearl farming, mussels are nucleated through surgery which initiates the process of pearl formation. The process starts with collecting mussels from river, which are then put under pre-operative care to help the mussels adapt to the new environment. The mussels are then operated upon and nucleus is implanted between its soft tissue. Subsequent to the surgery, mussels are put under post-operative care, also called the ICU stage. Post recovery, mussels are put in a pond, where they are tended to while pearls take shape inside the shell. Depending on the type of mussel, pearl formation can take anywhere between a few months and several years. The last stage comprises harvesting pearls. Pearls are extracted from the mussels, which are washed, cleaned and certified by gemmologists before they are sold. Elements of concern Erratic or extreme climatic conditions-Mussels could perish under extreme weather conditions. Untimely rains could destroy the pearl breeding mussels. Depleting quality of water- Due to increase in the number of industries and industrial waste which is often dumped in the water bodies without proper treatment, the water quality is depleting. Unsupportive Banks- Despite the fact that pearl farming comes under agriculture, banks do not provide loan for pearl farming. And it is always a challenge for a farmer or an entrepreneur to procure loan for the same. Marketing Obstacle- This is one of the most crucial challenges faced by a farmer. The domestic market is mostly consumed by artificial hyderabadi pearls, which makes it difficult of an entrepreneur to sell his cultured-pearls in the country. Pearls produced in India have to be thus exported. But again, there are no middlemen in India for exporting the produce. Government should establish agencies to help pearl farmers market their pearls, says Ravikiran, who helps farmers to market their pearls in the absence of any proper marketing chain. Technologically outdated- Technology is very crucial to pearl farming, as it helps in improving the quality and increasing the size of the pearl, which in turn helps fetch better price for the nugget. But, unfortunately, India lags far behind in pearl farming technology. Central Institute of Freshwater Aquaculture, premier research Institute on freshwater aquaculture in the country, has been trying to develop world-class technology for pearl production which can help farmers, but hadnt had much luck, says Mr Suresh Kumar, a pearl farmer from Bangalore. Lack of technology and unawareness about the existing technology is the reason why entrepreneurs often give up on the idea of pearl farming.

Investing in the Invaluable Cultivation of pearls involves capital investment and recurring expenditure. While capital expenditure includes buying or taking a land on lease, constructing a pond, plant and machinery, etc, recurring expenditure entail buying nuclei, which is generally imported from Japan, labour charges, harvesting charges, etc. Deciding Factor (ROI) Pearl farmers can get as much as 200 per cent return on their investment depending on the survival rate of mussels. Ravikiran says, In India the survival rate of oysters, under most favourable conditions, is as good as 80%. But to be on the safer side, it is better to go with the assumption that 50 per cent of mussels may not survive till the end. However, as long as the mortality rate is less than 50 per cent, one can expect to make approximately 200 per cent of net profit. Which is not bad at all! But what makes the business of shiney pearls super-attractive is the fact that pearl farming is exempted from tax as it falls under the agriculture sector. This essentially means farmers neednt pay any tax on their sale proceeds. However, the government does impose tax on export of pearls. Pearl farming, despite being a commercially viable and profitable business venture, farmers arent coming forward. Ravikiran explains, the reason why not many farmers are taking up pearl farming is because it is not supported by government. This makes it risky. According to him, our poor farmers are apprehensive as, in the absence of governments support, they dont have anyone to fall back on in case the project fails. He stresses that the government should make loans easily available to aspiring pearl farmers and should as well start a training institute to impart training to the hugely illiterate population of farmers on techniques and technology. By promoting pearl culture, not only can the government play an instrumental role in uplifting the financial condition of the pearl farmers, given the high profit margin in the business, it can also help increase Indias contribution to global pearl production which in todays date is less than a per cent says Ravikiran.