Abstract

Smallholders are the key contributors in the Sri Lankan tea industry, which brings much needed foreign income to the county. There has been ambiguity among the stakeholders about the road map to be followed by the tea farmers' organisations in Sri Lanka. This review attempt to discuss the critical issues in tea smallholding sector, the present status of Farmer Organisations (FOs) and their contribution in resolving the issues and to provide some insights on how they can be strengthened. This review is developed through the analysis of available literature and secondary data. The literature shows that FOs, in the world, has gone many miles in the paths of member empowerment, production support, processing, financing, extension service, welfare and marketing. Tea Small Holding Development Societies were formed by the government of Sri Lanka focussing on similar objectives, particularly agriculture development, marketing facilities, welfare activities and providing credits and inputs. Low productivity, low household income, poor adoption of technologies, small land size, senility of tea, poor service receiving from the state agencies, weak infrastructure facilities, labour issues and low prices for green leaf tea are the interconnected critical issues faced by the smallholders at present and which comes under the purview of the above objectives. Evidence, however, shows that tea sector farmers' organisations (Tea Smallholding Development Societies - TSDS) have not been able to achieve their expected gole. Some strategic approaches adopted by Indian Farmer Producer Companies, Japanese Agriculture Cooperatives and Kenyan Tea Development Agency such as shifting into the market orientation, value addition, product diversification, integration of services, collective approaches, strengthening of the federated structure should be considered in developing TSDS. This approach is coherent with social enterprise concepts. Non-profit organisations integrate for-profit activities to strengthen their social mission to meet the current socio-economic challenges. Thus, based on the evidence, the author believe that TSDS should be transformed as social enterprises.

Keywords: Farmer Organisation, Market-oriented activities, Sri Lanka, Social enterprise, Tea smallholders