Burdwan Mills

DIAGNOSTIC STUDY REPORT
ON
RICE MILLS CLUSTER IN BURDWAN
Directorate of Cottage & Small Scale Industries,

Govt. of West Bengal
WEST BENGAL CONSULTANCY ORGANISATION LIMITED, KOLKATA

AN ISO 9001:2000 ORGANISATION
April, 2007
Diagnostic Study Report – Rice Mills Cluster in Burdwan
CONTENTS
Sl. Title Page

No.
1.0 INTRODUCTION
1.1 Backdrop 1
1.2 International Scenario 2
1.3 National Scenario 2
1.4 State Scenario 5
2.0 CLUSTER SCENARIO
2.1 History of the Cluster 7
2.2 Location of the Cluster 8
2.3 Ownership, Size/Capacity, Investments, Production & Turnover 8
2.4 Typologies of the Cluster 10
2.5 Concentration of Units 11
2.6 Principal Stakeholders 12
2.7 Other Stakeholders 13
2.8 Process Technology & Flow Chart 16
2.8 Present Cluster Map 20
2.9 Current Institutional Matrix 21
2.10 Benchmarking with the Other Cluster 21
3.0 ANALYSIS OF BUSINESS OPERATIONS (AOBO)
3.1 General 23
3.2 Process Technology & Flow Chart 23
3.3 Raw Materials Procurement System 23
3.4 Present Marketing System 24
3.5 Financial Aspects 25
3.6 Manpower & Employment 26
3.7 Value Chain Analysis 26
3.8 Pressure Points 28
3.9 Social Capital 28
4.0 SWOT ANALYSIS
4.1 General 29
4.2 SWOT Analysis 29
April, 2007
Sl. Title Page

No.
5.0 CLUSTER VISION
5.1 Vision of the Cluster 33
5.2 Long-run Objectives 33
5.3 Strategy of the Cluster 33
5.4 Future Cluster Map 34
6.0 STRATEGIC ACTION PLAN WITH SCHEDULE & BUDGET
ESTIMATES
6.1 Strategic Action Plan 36
6.2 Developmental Programme Schedule & Budget Estimates 38
6.3 Funding Pattern 38
6.4 Action Plant & Budget (2007-08 to 2009-10) 39 – 50
LIST OF ANNEXURES – I & II 51 – 65
April, 2007
CHAPTER – I
INTRODUCTION
1.1 BACKDROP
Burdwan District in the state of West Bengal assumes a very important role in the
overall agricultural production and industrial activities of the State. The district
having a very high literacy rate is also considered to be one of the developed
districts in the State.
Though the district has the distinct privilege of having a few major industries, it is
better known for its predominant agricultural activities in comparison to other
districts in the state. Agriculture in the district has toed the modern line with
passage of time. Paddy / Rice is the single produce, around which agricultural
activities of the district rotate. The district is truly called the ‘Granary of Bengal’
due to its topmost position in West Bengal in the production of paddy.
Rice milling is one of the most important activities of the district and this agro
processing activity produces and provides rice, the staple food of the region
catering to both domestic and export market. The district of Burdwan has the
largest concentration and accounts for nearly 50% of rice mills in the state. The
number of rice mills in the district is around 400.
With the increase in production of rice through adoption of scientific system of

agriculture, the number of rice mills in the district went on increasing over the
years and proximity of the district to the city of Kolkata provided an elastic market
for the industry to bulge.
The district has a very good road and rail connectivity and is served by a well-knit
network of National and State Highways, Expressways and Eastern Railways.
Good infrastructure in the form of Commercial Banks, University, Technical
Institutions, Management Institutions, etc. is also in place for agricultural and
industrial activities in the district. As a sequel, many industries in the medium and
small-scale sectors have come up, which supplement and compliment the ever-
growing economic activities in the district.
1.2 INTERNATIONAL SCENARIO
1 April, 2007
“Rice is life” or the primary food source of thousands of millions of people in the
world. In Asia alone, more than 2,000 million people obtain 60 to 70% of their
energy intake from rice and its products. It is of significant importance for food
security in an increasing number of low-income food-deficit countries. The United
Nations General Assembly (UNGA) had, after having recognised the importance
of this crop, declared 2004 as the “International Year of Rice” (IYR).
Thailand, USA & UK are the three leading countries in rice production in the
international market with short grained non-Basmati varieties as their basic
produce. This apart, Europe and UK also procure brown Basmati semi-
processed rice from India and process it further as per requirements. Rice milling
industry in these countries has made use of modern technologies of processing
with automatic systems, reaped the benefit of continuous R&D activities, adopted
Total Quality Management (TQM) system and hence are highly efficient. India
occupies the topmost position in the world in case of Basmati rice, but faces stiff
competition from Thailand, Philippines and Vietnam incase of non-Basmati
variety.
1.3 NATIONAL SCENARIO
2 April, 2007
India is a leading producer and exporter of rice. It produces about 25% of the
total rice production of the world and exports 15% of the total global demand. It is
the largest producer and exporter of basmati rice in the world. The capacity of
rice mills in the country varies widely from as low as 0.5 TPH to as high as
197TPH. There exists also a wide variation in technological aspects in rice milling
with low productive small mills with simple machinery on one side and high
productive, highly automatic mills with sophisticated machinery on the other.
In India rice milling units are mostly concentrated in the paddy producing states
like Uttar Pradesh, Punjab, Haryana, Uttaranchal, West Bengal, Bihar, Orissa,
Assam, Andhra Pradesh, Karnataka and Kerala. The Basmati Varieties of rice are
mainly produced in Punjab, Haryana, Uttaranchal and Uttar Pradesh while the
non- Basmati varieties are produced in other states. India has received patent for
its Basmati varieties of rice. In respect to exports of fine quality of Basmati rice
from the country Haryana heads the list and is followed by Punjab. A few
benchmarking rice clusters of the country have been developed in these two
states which are rich in production, exports, quality and technology. The non-
Basmati rice produced in the country constitutes both the aromatic and non-
aromatic varieties. Depending on the regional food habits the rice mills produce
raw rice and parboiled rice – the mills in Eastern India producing mainly the
parboiled variety.
Rice milling industry in India has undergone different phases of technological

transformations related to winning, parboiling and drying systems and has
developed reasonably good rice mill machine manufacturing base, although it
lags far behind the countries like USA, UK, Germany, Japan, Taiwan, etc. Few
fully automatic plants imported from world renowned manufacturers from
countries like Japan and also colour sortex machine imported from USA, UK,
Japan & Taiwan have been installed by few mills of Karnal (Haryana), Kalady
(Kerala), Rudrapur (Uttaranchal), etc. Further some of the rice mills in Sambalpur
– Bargarh (Orissa), Burdwan & Bolepur (West Bengal) clusters have installed
colour sortex machine and silky polishing machine. Parboiled rice produced by
these units may compete in national and international market.
Production of paddy in three largest producing states in India during the past
three years was as given in Table 1.1 below:
3 April, 2007
Paddy production in three largest producing states in India
Table – 1.1
( mn. MT)
State 2002 - 03 2003 - 04 2004 – 05
West Bengal 14.39 14.71 14.91
Punjab 8.88 9.66 10.44
Uttar Pradesh 8.11 13.01 10.88
India 71.80 88.30 85.30
Source: Economic survey, GOI ( 2003-04 , 2004-05 & 2005-06 )
The quantum of rice exported from India during the past few years was as given
in the following table (Table 1.2) and the trend is represented graphically in the
figure below:
Exports of Rice from India

Table – 1.2
Qty: '000 MT; Value: Rs. in crore
1999-2000 2000-01 2001-02 2002-03 2003-04
Qty Value Qty Value Qty Value Qty Value Qty Value
Non-basmati 1257.747 1345.58 682.763 777.49 1541.485 1331.37 4347.134 3833.26 771.475 2174.94
Rice
Basmati Rice 638.380 1780.33 851.722 2165.96 667.065 1842.77 710.292 2062.59 2640.569 1993.05
Total 1896.127 3125.91 1534.485 2943.45 2208.55 3174.14 5057.426 5895.85 3412.044 4167.99
Source: Export Statistics for Agro & Food Products (2003-04) APEDA, Govt. of India
Trend of rice exports from India during 1999-2000 to 2003-04
6000
Qty: '000 MT
5000
1999-2000
4000
2000-01
3000
2001-02
2000
2002-03
1000 2003-04
0
Non-bas m ati Rice Basm ati Rice Total
The major countries importing basmati rice from India include UK, USA, Belgium,
Canada, France, Germany, Italy, Kuwait, Netherlands, Saudi Arabia, UAE, Yamen
Arab Republic, etc. For non-basmati rice, the major importers from India are
Bangladesh, Bhutan, Nepal, Ivory Coast, Djibouti, Gabon, Iran, Maldives,
4 April, 2007
Mozambique, Malaysia, Nigeria, Russia, South Africa, Saudi Arabia, Singapore,

Somalia, UAE, Yamen Arab Republic, etc.
The following figures represent graphically the trend of export of rice to major
importing countries during the period 1999-2000 to 2003-04:
Export of Non-Basmati Rice from India

Phillipines
Qty. in lakh tonnes
Malaysia
50.00
South Af rica
40.00
Bangladesh
30.00
20.00 Saudi Arabia
10.00 Nigeria
0.00 Others
1999-2000 2000-01 2001-02 2002-03 2003-04 Total
Export of Basmati Rice from India

Saudi Arabia
Qty. in lakh tonnes
10.00 U.K.
8.00 Kuw ait
6.00 USA
4.00
UAE
2.00
Others
0.00
Total
1999-2000 2000-01 2001-02 2002-03 2003-04
Source: Export Statistics for Agro & Food Products - India (2001-02 & 2003-04: APEDA, GOI)
1.4 STATE SCENARIO

West Bengal, being one of the leading paddy producers in the country, has quite
large concentration of rice mills with modern mill population of around 940
(including mini rice mills). These mills are of low capacities, the capacity in terms
of paddy throughput varying between 0.5 TPH to 4.0 TPH. With an average
paddy throughput capacity of 2.5 TPH or 40 TPD per unit based on operation in 2
shifts (16 hrs./ day), these mills have an aggregated annual paddy throughput
capacity of around 112.80 lakh tonnes (11.28 mn. tonnes).
In the state the district of Burdwan has the largest concentration of rice mills, the
other districts having good concentration being Birbhum, Bankura, Paschim
Midnapur, Hooghly, etc. Rice produced by the mills in the state caters to both
5 April, 2007
domestic and export market. Parboiled rice is the major product of these mills,
although there exists some rice mills producing raw rice as their principal product.
Only a few small mills produce the aromatic rice, non- aromatic rice being the
main produce.
Both sundrying and mechanical drying systems are existent in old mills which
have undergone modernisation, but all the new mills which have come up during
past few years are equipped with mechanical drying system only. There are only
a very few mills in the state, which have incorporated colour sortex machine and
silky polishing machine for producing superior quality of rice, mainly for the export
market.
Production of paddy in West Bengal during the last three years was as given
hereunder in Table-1.3:
Paddy production in major districts of West Bengal

Table – 1.3
(’000 Mt)
District 2002-03 2003-04 2004-05
Bardhaman 1931.40 2008.10 1892.90
Paschim Medinipur 1551.80 1508.20 1736.80
Murshidabad 1072.80 1113.60 1194.50
24- Pgs. ( S ) 940.80 969.60 912.30
24 – Pgs. ( N ) 751.60 701.60 686.60
Nadia 999.10 840.10 763.70
West Bengal 14389.20 14662.20 14884.90
Source : Economic Review ( 2005-06 ), GoWB – Statistical Appendix
6 April, 2007
CHAPTER – II
CLUSTER SCENARIO
2.1 HISTORY OF THE CLUSTER

There is a saying that in pre-Independence era during 1930 – 40, a few rice mills
were started in and around Kolkata (then Calcutta) mainly based on the supply of
paddy from Bangladesh (the East Pakistan) and also a few mills were in
existence in the districts of Burdwan, Midnapore and Bankura using the crude
milling technique.
Prior to 1955 – 60 paddy was used to be boiled in small pots and dried in
sunlight. The dried paddy used to be dehusked by means of hand pounding. In
this phase, the development of agricultural activities in Burdwan district enhanced
the process of formulation up of Rice Mills Industries Act (RMI Act).
Prior to 1970 rice mills used to be operated mostly as husking mills at the home /
cottage scale. Motorised hullers have been used for milling. Since 1970,
modernization started taking place and operated in the cluster with an average
production capacity of 5 – 6 metric tones per day. They parboiled paddy in mild
steel vessels and dried the same in yards under sunlight and milled this dried
paddy in the motorized hullers. During this phase, these mills could not produce
good quality of rice, as the mills did not have adequate paddy cleaning,
parboiling, mechanical drying and milling facilities. Moreover, these mills used to
7 April, 2007
remain closed during the monsoon period, in absence of adequate sunlight for
drying during the period.
From the year 1990 adoption of mechanical drying system in rice mills started
taking place and the system got a good acceptance with conversion of sundrying
system to mechanical drying system in majority of the old mills. However, the
sundrying system in the old mills adopting mechanical system could not be
phased out on employment ground.
The new mills, which came up during the past 4/5 years have incorporated
mechanical drying system.
Gradually the number of mills increased to around 400 with financial assistance
from commercial banks and state financial corporation. During this phase, a more
modernized and mechanized parboiling and drying system of paddy has been
introduced and the mills now operate on an average of 300 days in a year.
Consequently, the production of byproducts like rice bran and rice husk has
increased substantially alongwith the quantum jump in the production of rice, the
main product.
2.2 LOCATION OF THE CLUSTER

The rice mills in Burdwan are distributed in 14 blocks of the district with largest
concentration in the Burdwan Sadar block (133 mills) followed by Raina block (63
mills), Khandaghosh block (42 mills), Memari block (43 mills), Galsi block (26
mills) and the remaining other 9 blocks accommodating altogether (67 mills).
Burdwan Sadar is the biggest rice mill cluster not only in the district but also in
the State. It is around 100 km. away from Kolkata, the State capital. The mills in
this block are located within a radius of about 10 – 12 km. The other large
clusters in the district viz. Raina, Khandaghosh, Memari & Galsi blocks are about
25 km., 30 km., 20 km. & 20 km. respectively away from Burdwan block. The
Burdwan Sadar Rice Mill Cluster with around 133 mills has been identified
for intervention.
2.3 OWNERSHIP, SIZE / CAPACITY, INVESTMENTS,

PRODUCTION & TURNOVER
8 April, 2007
Following paragraphs highlight the salient feature of the cluster with reference to
ownership, size / capacity, investments, production & turnover as prevailed in
2006.
2.3.1 Ownership Pattern

Most of the rice mills in the district and also in the identified cluster (Burdwan
Sadar) are partnership firm, although there are some units as private limited
companies. Most of the new mills, which have come up during the past 4/5 years
are private limited companies.
2.3.2 Size / Capacity

These mills are having a production capacity ranging from 8 TPD to 75 TPD
based on double shift operation. Aggregated annual production capacity of the
rice mills in Burdwan District may be around 5785 TPD or 17.35 lakh TPA based
on single shift and 300 working days/ annum (5785 TPD x 300 days = 1735500
TPA). The aggregated annual production capacity of 133 rice mills under
Burdwan Sadar Cluster is around 1940 TPD.
The mill size distribution in terms of daily paddy throughput in Burdwan district
and in Burdwan Sadar block is as given in Table-2.1 below:
Mill Size Distribution in Terms of Capacity

Table – 2.1
Sl. Size Processing No. of Units
No Capacity (TPD) Burdwan Burdwan
District Sadar Block
1. Big SSI Units 60 - 75 3 -
2. Medium SSI Units 30 - 50 20 5
3. Small SSI Units 8 - 25 351 128
Total : 374 133
Capacity-wise distribution of mill population in Burdwan district and also in

Burdwan Sadar Block is presented in the following figures: -
9 April, 2007
CAPACITY-WISE DISTRIBUTION OF RICE M ILLING UNITS IN

BURDWAN DISTRICT
75 2
60 1
CAPACITY (TPD)
40 9
30 11
25 2
24 1
20 58
15 93
12 144
10 52
8 1
0 50 100 150 200

NO. OF UNITS
10 April, 2007
CAPACITY-WISE DISTRIBUTION OF RICE M ILLING UNITS IN

BURDWAN SADAR (CLUSTER IDENTIFIED FOR INTERVENTION)
11
10
9 3
CAPACITY (TPD)
8 2
7 1
6 1
5 20
4 29
3 54
2 22
1 1
0 10 20 30 40 50 60
NO. OF UNITS
2.3.3 Investments
Based on an average investment of Rs.2/- crore per mill, the estimated
aggregated investment in rice mills under Burdwan Sadar Block Cluster is
Rs.270/- crore as against the total investment of Rs.750/- crore in the district.
2.3.4 Turnover
The total turnover from the rice mills under Burdwan Sadar Block Cluster is
estimated at around Rs.800/- crore as against Rs.2,250/- crore in the district on
the basis of investment of Rs.6/- crore per unit on an average.
2.4 TYPOLOGIES OF THE CLUSTER

The rice-milling cluster in Burdwan Sadar Block is a natural cluster and produces
three types of product viz. parboiled rice, pressure parboiled rice and raw rice as
the main product. The mills using atmospheric parboiling produce ordinary rice
while those using pressure-parboiling system produce parboiled rice for puffed
rice. The processing system is somewhat different for these three varieties of
rice.
11 April, 2007
2.5 CONCENTRATION OF UNITS

There are around 374 nos. of modern rice mills in Burdwan district. All these mills
are in the small-scale sector.
Such mills are located in and around Burdwan town and also in the areas like
Saktigarh, Memari, Galsi, Katwa, Kalna, etc. Following table (Table-2.2) presents
the block-wise distribution of rice mills in the district: -
Block-wise Distribution of Rice Mills in Burdwan District

Table – 2.2
Sl. Block No. of Units Total Capacity
No. (TPD)
1. Asansol 6 72
2. Ausgram 18 294
3. Bhatar 11 146
4. Galsi 26 499
5. Jamalpur 5 79
6. Kalna 9 194
7. Kanksha 6 92
8. Katwa 14 467
9. Khandaghosh 42 514
10. Manteswar 6 111
11. Memari 33 480
12. Purbasthali 2 42
13. Raina 63 855
14. Sadar 133 1940
Total: 374 5785
12 April, 2007
The following map highlights the block-wise concentration distribution of rice mill
in Burdwan district: -
14
18
6
2
6
11
26
133
42 9
33
63 5
13 April, 2007
2.6 PRINCIPAL STAKEHOLDERS

The principal stakeholders of the cluster are the rice mills within the cluster.
Rice Mills:
Out of around 133 rice mills in the Burdwan Sadar Block Cluster, 5 are medium
(30 – 50 TPD) and the rest 128 (8 – 25 TPD) are small units. There is no big unit
with paddy throughput of 60-75 TPD in this cluster. All these mills are in the SSI
Sector. Most of these mills produce parboiled rice as the major product, while
there are only around 12 units producing raw rice. These mills have very little
cooperation amongst themselves with regard to their common interests such as
procurement of raw materials & consumables, marketing of products and
byproducts and also relating to technological upgradation, product innovation in
their mills. Consequently, a general poor performance is prevalent.
2.7 OTHER STAKEHOLDERS

Other stakeholders include the following: -
 Paddy suppliers (farmers & traders)
 Packaging material suppliers
 Plant & Machinery suppliers
 Govt. procurement agencies
 Traders of rice, rice bran and husk
14 April, 2007
 Exporters of rice
 Industry Association
 District Industries Centre
 R&D Centre
 Banks & Financial Institutions
Paddy suppliers (farmers & traders):

Paddy, the major raw material for rice mills, is procured both from the farmers &
the traders. Procurement of this item from other districts in the state and also
from other states like Bihar, Orissa and Jharkhand is mainly made from the
traders, while local procurement of paddy is from both farmers & traders. The
quantum of paddy procurement from traders & farmers is generally in the ratio of
90 : 10.
In view of the un-organised paddy procurement system in the state, the millers in
the Burdwan rice mill cluster are to pay high price for procurement of paddy.
While the prevailing minimum support price (MSP) for paddy is Rs.580/- per
quintal, the open market price is around Rs. 650.00 to 750.00 per quintal. The
millers cannot exercise much of their bargaining power resulting in high incidence
of raw material cost.
Packaging material suppliers:

Jute bags are mainly used for packaging of rice, rice bran and rice husk. For
Govt. supply of rice against levy procurement, new jute bags are used, while for
open market sales to traders rice is packaged in second hand jute bags and the
old jute bags containing paddy is generally used for this purpose.
The new jute bags are procured from local manufacturers and sometimes also
from the suppliers in Kolkata. The requirement of such new bags is not much and
the rice millers do not face many problems in their procurement. However, the
unit price of such new jute bags varies widely throughout the year.
Plant & Machinery suppliers:

Plant & machinery in use are mostly fabricated items from local fabricators and
also from those existing in Kolkata. The milling machines, polishing machines,
etc. are generally sourced from the reputed machinery manufacturers in Kolkata
15 April, 2007
and also from other parts of the country. The technology used by the rice millers
in their plants is not up-to-date as the plant & machinery manufacturers and
suppliers from whom they procure such items have weak linkage with the R&D
institutions. Further, the millers have very poor accessibility to foreign suppliers of
costly advanced plant & machinery with high productivity and automatic control.
Although some machinery suppliers with foreign collaboration like Buhler India
have established their shops in the country, the rice mill cluster in Burdwan have
not much exploited such facilities so far.
Govt. procurement agencies:

The different Govt. procurement agencies for the rice are –
 Department of Food & Supply through the District Controller’s Office
 BENFED
 CONFED
The rice millers in the district are to adhere to the levy commitment fixed by the
District Committee.
Traders of rice, rice bran and husk:

According to the prevailing custom, rice produced by the millers for the open
market is procured directly by the traders and the millers do not have any
marketing effort in this regard. There are around 20 traders of rice operating in
the cluster.
Rice bran, a valuable byproduct of rice milling, is mostly sold to the solvent oil
extraction units located in the district directly. There are around 8 such units in the
district with an aggregated processing capacity of around 400 TPD of rice bran. A
part of rice bran production is also sent outside the state through local traders.
The number of rice bran traders in the district presently operating shall not
exceed 4 / 5.
Most of the rice husk produced in the cluster is burnt as fuel in the boilers for
steam raising and also for power generation using gasifiers and gensets. Only
the excess quantity after meeting the above requirements is sold to the traders.
Exporters of rice
16 April, 2007
Only a very small quantity of rice is exported to the neighbouring countries

through the exporters. There are only a very few exporters of rice at present.
Industry Association
Burdwan District Rice Mills Owners Association has been operating in the cluster
since more than 30 years and all rice mills of the Burdwan Sadar Block Cluster
are members of this association. The office of the association is located in
Burdwan town. This association in its executive committee has a president, a
vice-president, a general secretary, a treasurer, an assistant secretary and a
number of executive members. It has the following three sub-committees to look
after the interests of the members rice mills: -
 Finance sub-committee
 Labour sub-committee
 Levy sub-committee
The association, however, does not have any Technical sub-committee. The
Burdwan Chamber of Commerce, which has affiliation to the Bengal National
Chamber of Commerce & industries (BNCCI), Kolkata, play a significant role in
the cluster. Most of the members of the district rice mill owners associations are
also the members of the chamber of commerce.
District Industries Centre

All the mills in the Burdwan Rice Mill Cluster are not registered with the District
Industries Centre (DIC), Burdwan. While most of the new mills are registered with
the DIC, there are a large number of old mills, which have not obtained
registration. For availing of various subsidies from the Govt. it is essential that all
the mills should be registered with DIC. The office of DIC is located in Burdwan
town.
After coming the MSME (Micro, Small and Medium Enterprises) act into force the
process of registration has been simplified and the old system of temporary and
permanent registration has been replaced by Entrepreneurs Memorandum (EM)
Part-I & II respectively.
17 April, 2007
R&D Centre
In the eastern region there are two renowned R&D institutions associated with
the developmental works on the production, milling & processing of rice. These
are –
 Central Rice Research Institute (CRRI), Cuttack
 Indian Institute of Technology (IIT), Kharagpur
While CRRI, Cuttack carries out R&D works on the agricultural aspects, IIT,
Kharagpur, Rice Processing Center is engaged in R&D on rice processing
technologies. The mills in the Burdwan Sadar Block rice mill cluster have very
poor linkage with the above R&D institutions and as such these units could not
utilise the benefit of technological upgradation and product development so far.
Banks & Financial Institutions

The old mills in the cluster could not and also did not avail the services from the
banks & financial institutions operating in the district with regard to financial
assistance in view of low fund requirement for small mills and also the non-
aggressive attitude of the banks and financial institutions for financing such units.
However, with the nationalised banks, co-operative banks and state financial
institutions being liberal of late, the new mills, which have come up during the
past, few years, have availed of financial assistance from such institutions. This
has developed a better linkage between the mills and such institutions. The lead
bank of the district is Uco Bank, the office of which is located in Burdwan town.
The branch office of West Bengal Financial Corporation (WBFC) is located at
Durgapur, about 50 km away from the cluster.
2.8 PROCESS TECHNOLOGY & FLOW CHART

Three types of rice are produced by milling of paddy in the rice mills. These are –
 Raw Rice
 Parboiled Rice
 Pressure Parboiled Rice (used for production of puffed rice)
The manufacturing of parboiled rice from paddy involves the following major
steps:
 Cleaning of Paddy using paddy cleaner & destoner
18 April, 2007
 Parboiling of cleaned paddy in parboiling plant

 Mechanical Drying of parboiled paddy using steam
 Milling of parboiled & dried paddy using sheller type milling machines
 Separation of husk using sieve cleaning of rice
 Polishing of rice using parling cones
 Separation of rice bran using sieve
 Separation of broken rice (brokens) using sieve
 Weighing & Bagging of rice & byproducts
For production of ordinary parboiled rice, atmospheric parboiling system is used

while for the production of parboiled rice for puffed rice making the pressure
parboiling system is utilised.
For production of raw rice, the paddy after its cleaning and drying is milled using
sheller and it does not pass through the parboiling system.
Whole rice is the main product of rice milling and rice bran, rice husk and broken
rice are obtained as byproduct during the process. Rice husk is the outer shell of
rice and it is a fibrous material containing good amount of silica. Rice bran is a
fine powder obtained during polishing of the brown rice when the outer coating on
rice is removed as rice bran. It contains vegetable oil as a valuable constituent.
The flow sheet depicting the process of manufacture of rice from paddy is
presented below: -
19 April, 2007
FLOW CHART FOR RAW RICE / PARBOILED RICE MANUFACTURE
Paddy
For Parboiled Rice

Cleaning Open Steaming
For Raw Rice

Soaking
Drying
For Raw / Parboiled Rice Parboiling

(Atmos. / Pressure)
Sun Mechanical
Drying Drying
Shelling Unit
Cleaning Dehusking Husk Seperator Husk
Unshelled Paddy
Paddy Seperator
Brown
Rice
Polishing Unit
Bran Separator Bran
Rice Grader
Whole Rice Broken Rice

& Impurities
Weighment & Weighment &

Packing Packing
20 April, 2007
Process Flow Chart for Super Quality / Export Quality Rice
Rice produced by
common rice mill
Silky Unit
Destoning Unit
Colour Sorting Machine
Grading
Weighment and Packing
The recovery of product and by-product from rice milling are as given below:
Paddy
Processing /
Milling
Rice (63%) By-Products Refraction

(27%) (10%)
Bran (5%) Husk (19%) Broken Rice (3%)

(Used for Solvent (Used as Fuel in Boiler, (Used for Cattle/Poultry
Extraction of Oil) Gasifier, Furnace) Feed, Human
Consumption, etc.)
The material balance for a rice mill having sample size of 18 TPD paddy
throughput is presented below:
300 Bags @ 60 Kg / bag = 18 Ton Paddy (180 Qntls.)
Rice - 63% Broken Rice - 3% Rice Bran - 5% Husk – 19 % Refraction -10%

113.4 Qtls. 5.4 Qtls. 9.0 Qtls. 34.2 Qtls. 18 Qtls.
21 April, 2007
22 April, 2007
It is observed that the recovery of whole rice is only 63% of paddy processed as
against the achievable recovery of around 65%. Also the content of brokens are
as high as 3% against the normal content of around 2%. The recovery of rice
bran is also at a low level of 5% against the achievable recovery of 6%. The low
recovery of product and byproducts are mainly due to use of backdated
technology and low level of skill of the operators.
2.9 PRESENT CLUSTER MAP

The present cluster map depicts the inter-linkages amongst important cluster
actor. A dotted line in the map denotes the weak linkage, while a firm line denotes
strong and stable linkage. Similarly, a rectangular with dotted line denotes an
organisation with weak intra-linkages and a firm line rectangular denotes strong
and stable intra-linkage. The following figure presents the Current Cluster Map of
the rice mill cluster in Burdwan: -
Institutions
Ministry of Food CRRI & IIT APEDA Certification agencies

SISI & DIC Banks & FIs Processing technical institutions
State Pollution Control
Deptt. of Food & Board Agricultural Deptt.
Supplies Inspector - Factory & Boilers
Forward Linkage Principal Firms Backward Linkage

Central/ State Warehouse
Corporation/ Agencies Spare parts
Large Mills (3) Supplier
Domestic Market
State Electricity
Export Market
Board
Packing Material
Medium Mills (20) Suppliers
Road Rail Paddy Farmers
Transport Chartered Paddy Suppliers
Export Accountants from other Districts
Consultant Small Mills (351) Paddy Suppliers
Labour
Contractors from other States
Testing
Laboratory
Machinery & Raw
BDS Providers Material Suppliers
CURRENT CLUSTER MAP
2.10
CURRENT INSTITUTIONAL MATRIX
The current institutional matrix depicts the relationship amongst the various
institutions operating in the cluster. Different scores are allotted to indicate the
type of relationship in the scale of 1 to 5, score 5 indicating excellent relationship,
23 April, 2007
while the score 1 indicating poor relationship between various institutions and the
cluster. The following table (Table-2.3) presents the current institutional matrix of
the rice mill cluster in Burdwan: -
Table – 2.3
INSTITUTIONAL MATRIX
Rice Mill Bank / D.C. DIC Tech. Supplier WBSEB WBPCB
Asson. FIs (F&S) IIT & CRRI
Rice Mill Asson. - 4 3 3 1 2 1

Bank / FIs 4 - 3 3 1 1 1
D.C.(F&S) 3 3 - 3 1 2 1
DIC 3 3 2 - 1 3 2
Tech. Supplier 1 1 1 1 - 1 1
IIT & CRRI
WBSEB 2 1 1 3 1 - 1
WBPCB 1 1 1 2 1 1 -
2.11 BENCHMARKING WITH THE OTHER CLUSTER

Rice milling industry in the country is prevalent in the states like Punjab, Haryana,
Uttaranchal, Uttar Pradesh, West Bengal, Bihar, Orissa, Assam, Andhra Pradesh,
Tamilnadu, Kerala and Karnataka.
The Basmati varieties of rice are produced mainly in the states of Punjab,
Haryana, Uttar Pradesh and Uttaranchal while the non- Basmati varieties are
produced in all of the above states. In most of these states with rice milling as
one of the major industrial activities, the mills have developed in the form of
clusters.
Punjab and Haryana have emerged as the major producing states for Basmati
rice in the country and have made large advancements with respect to its
production, exports, quality & technology upgradation. The Karnal rice milling
cluster in Haryana had been covered under the cluster development scheme of
the DCSSI, Govt. of India and is leant to have made satisfactory progress in
moving upwards in the value chain.
The Kalady rice milling cluster in Kerala, the largest cluster in the state, with 70
odd performing rice mills producing non- Basmati rice has emerged as a model
rice mill cluster in the country. The Industries Department, Govt. of Kerala took
lead in promoting proactivity in this cluster through a consortium based approach
24 April, 2007
for 39 rice mills with the formation of Kalady Rice Millers Consortium Pvt Ltd. The
consortium is now a marketing arm of the cluster, has managed to reduce cost of
inputs and is also venturing into tapping the profitability from byproducts. The
consortium is now sustaining the interventions and is looking for further growth by
exploring the export market and also innovative schemes such as bio-gas
operated gensets. A Common Facility Center (CFC) for rice bran oil extraction
has been established. Further a Refinery project and registration under
Geographical Indication Act for high value rice are also in the pipeline. The
Kalady rice mill cluster has made good progress in moving up the value chain
and is still in the process of moving up further in the value chain.
Against the above background the Kalady Rice mill cluster may be considered as
the bench - marking cluster.
25 April, 2007
CHAPTER – III
ANALYSIS OF BUSINESS OPERATIONS
3.1 GENERAL
Analysis of Business Operation (AOBO) is an important tool for characterising the
structure of the cluster and also identification of its problems and prospects
relating to the growth of the cluster.
The AOBO for rice mill cluster in Burdwan has been made considering the
following factors: -
 Process Technology & Flow Chart

 Raw Materials Procurement System
 Present Marketing System
 Financial Aspects
 Manpower & Employment
 Value Chain Analysis
 Pressure Points
 Social Capital
3.2 PROCESS TECHNOLOGY & FLOW CHART

The process technology for manufacturing of parboiled rice and raw rice from
paddy has been discussed in the preceding chapter (Chapter-II).
3.3 RAW MATERIALS PROCUREMENT SYSTEM

In existing system purchase of paddy (as major and critical raw material) is
arranged through traders (90%) and directly from farmers (10%).
Out of total requirement of paddy, 70% is procured from within the state and
remaining 30% is procured from the neighbouring states like, Bihar, Orissa and
Jharkhand. The mills are fed with only to the extent of 40% of raw material
(paddy) grown in the district. Amongst other districts in the state, the supply of
paddy from Midnapore district is the maximum.
26 April, 2007
High cost of raw material is due to involvement of huge transportation cost for its
procurement from outside the district and state. The grade wise average cost of
paddy as procured by the cluster is as given in Table-3.1 below:
Grate-wise Average Cost of Paddy

Table – 3.1
Sl. Grade of Rice Variety of Raw Material Cost
No. ( Paddy ) ( Rs./ Qtl. )
1. Superfine Mini Kit 800.00 – 950.00
2. Fine IR - 36 700.00 – 800.00
3. Medium Swarno / Masuri 650.00 – 750.00
4. Coarse 1010 ( Mota ) 585.00 – 685.00
The rice mills need quite good quantities of consumables and spares for its
operation and maintenance. The average need of such items corresponds to an
annual expenditure of around Rs.25 to 30 lakh per mill. There is no control on
such expenditure at present in the absence of any organised procurement
system.
3.4 PRESENT MARKETING SYSTEM

The major product of rice milling is whole rice and the byproducts include rice
bran and rice husk. Apart from selling the product in the open market, the rice
millers are also to undertake milling and delivery of rice to meet the levy
obligations and also custom milling operation.
Presently, the share of product (rice) of the cluster in the open market is as
follows:
 Local Market : 75%

 National Market : 10%
 Export Market : 15%.
Rice, the major product of rice milling, is marketed in the domestic market
through the local traders. It is exported to other countries through 3 local
exporters. The millers do not have any direct access to the fast expanding
domestic and export market and also they are not conscious about the quality
requirements of the consumers in both these sectors. Consequently, the millers
are largely dependent on the traders and do not have much bargaining power for
marketing their products.
27 April, 2007
The domestic price structure of different grades of product (rice) and also
byproducts are as given in Table-3.2 below: -
Domestic Price Structure of Rice

Table – 3.2
Sl. Grade Price Range ( Rs. / Qtl. )
No.
1. Superfine 1300.00 – 1500.00
2. Fine 1050.00 – 1250.00
3. Medium 1000.00 – 1100.00
4. Coarse 900.00 – 1000.00
5. Broken Gr. - 1 750.00 – 780.00
6. Broken Gr. - 2 650.00 – 700.00
7. Rice Bran Gr.-I 730.00 – 750.00
8. Rice Bran Gr.-II 590.00 – 600.00
Note : Rice bran Gr.-I is with low FFA and Rice Bran Gr.-II is with high FFA.
Levy Rice (As per Govt. Deptt.):

Levy quantity of rice fixed by the government for the district is shared by the mills
as per the processing capacity of the respective mill under the guidance of
District Level Monitoring Committee. The rice millers procuring paddy against the
minimum support price (MSP) fixed by the Govt. process it in their mills and
deliver 75% of rice produced from such paddy to the Central Pool. The prevailing
MSP for paddy and the rice procurement price per quintal are respectively Rs.
580 and Rs.1000.80.
In another system of milling, paddy is supplied by the Govt. agencies like

BENFED and CONFED as free issue material and milling charges are paid to the
miller against the supply of rice.
3.5 FINANCIAL ASPECTS

The older mills were mostly funded from own resources of the promoters, while
the new mills have been generally funded through a mix of promoters’
contribution and financial assistance from banks and other financial institutions.
Some of the older mills have, however, availed of institutional finance during their
modernisation. The rice millers in Burdwan rice mill cluster are quite resourceful
and have ability to fund any development / upgradation as may be required for
improvement of performance of their mills.
28 April, 2007
3.6 MANPOWER & EMPLOYMENT

The total direct employment is of the order of 50,000 nos. The male / female ratio
is around 75% : 25%. Majority of the employment in the mills involves casual
workers with only a limited portion having permanent employment. The level of
skill of the manpower is average and there exists scarcity in the availability of
adequately skilled manpower for milling, boiler operation and gasifier operation.
The manpower available in the cluster does not have requisite skill for operation
of sophisticated machinery like colour sortex machine, silky polishing machine,
etc.
3.7 VALUE CHAIN ANALYSIS

The Value Chain analysis for production of parboiled rice is presented in the next
page:
29 April, 2007
Cost of raw material (Paddy)

Rs.650/- per Qtl
Cost of energy (Power & Fuel)

Rs.35/- per Qtl
(Accumulated value Rs.685/- per Qtl .)
Cost of manpower
Rs.10/- per Qtl .
Cost of consumables & stores

Rs.10/- per Qtl .
Cost of packaging material

Rs.15/- per Qtl .
Other incidental cost

Rs.10/- per Qtl .
Total expenditure Rs.730.00
Yield of whole rice @ 63% of paddy

i.e. 63 Kg/ Qtl x Rs.1100/- per Qtl
=Rs.693/-
Yield of byproducts
Rice Bran : 5Kg x Rs.750/- Qtl .=Rs.37.50
Broken Rice : 3kg. X Rs.750/- Qtl . = Rs.22.50
Excess Rice Husk : 3kg. X Rs.150/- Qtl . = Rs.4.50
(Total Rs.64.50)
Total earnings Rs.757.50/-
Net profit
(Rs.757.50 - Rs.730.00)
= Rs.27.50 per Qtl .
30 April, 2007
VALUE CHAIN ANALYSIS
3.8 PRESSURE POINTS
31 April, 2007
 Improving the yield of whole rice through minimisation of yield of broken rice
generation.
 Quality improvement of rice to achieve better national and export market

share.
 Improvement of recovery and gainful utilisation of byproducts.
 Economic utilisation of rice husk ash (Boiler Ash).
 Creation of testing facility for rice bran and other byproducts.
 Reduction of energy consumption.
 Technical skill development of man power.
 Creation of an organised paddy procurement system to stabilise the cost of

paddy in open market.
3.9 SOCIAL CAPITAL

Rice milling industries association in this particular cluster lack in providing the
following inputs to their member units: -
 Marketing information and data flow.

 Training and motivational programmes.
 Developmental activities including participation in technical workshop, trade
fairs, R&D and technical information dissemination, energy conservation,
pollution minimisation, etc.
It is needed to build social capital among the dynamic personalities so as to

enable them to organize aforesaid activities effectively for upgradation of rice mill
cluster.
32 April, 2007
CHAPTER – IV
SWOT ANALYSIS
4.1 GENERAL
A SWOT analysis of the cluster has been made as this will be useful for proper
understanding of the capabilities of the cluster to face the future challenges.
This analysis of strength, weakness, opportunities and threats has been

undertaken in terms of the following parameters: -
 Markets
 Technology
 Inputs availability
 Innovation capabilities
 Human resource / skill
 Infrastructure
4.2 SWOT ANALYSIS

Sl Parameters Strength Weakness Opportunity Threats
No.
1. Markets  Str  Poor  Gro  Stro
ong domestic quality of raw wing export ng
market within material (paddy) market size of competition
the state as with high the product from other
rice is the content of may be Asian
staple food of refraction. availed of by countries in
West Bengal. installing the
 Comp sophisticated international
ulsory & machinery like market.
controlled Colour Sortex
marketing for Machine,  Irre
levy rice. Silky gular supply
Polishing of paddy from
 Poor outside the
accessibility to Machine, etc.
state.
export market.  Ret
 Unsta ail boom in
ble selling price the country
of rice in opening up
domestic domestic
market. market for
high quality
 Weak products.
market for
byproducts.
33 April, 2007
Sl. Parameters Strength Weakness Opportunity Threats

No.
 Pestic  Bra
ides content in nd positioning
product makes it &
unfit for export enhancement
to advanced of production
countries. of aromatic
rice like
Gobindo
Bhog may
widen national
&
International
market for the
product.
 Org
anic rice
produced with
the use of bio-
fertiliser, bio
insecticides
and pesticides
has good
export market.
 Inc
orporation of
colour sortex
machine, silky
polishing
machine may
upgrade the
quality of rice
to make it fit
for export.
 Effi
cient recovery
of byproducts
and their
utilisation may
improve
operational
performance
2. Technology  Ava  Back  Pot  Ado
ilability of low dated ential for ption of
cost technology with improvement advanced
indigenous high of productivity technology for
machinery consumption of with improvement
from reputed energy, low appropriates of productivity,
manufacturers productivity and technical product
/ local high percentage backup from quality and
fabricators. of brokens. R&D bringing down
institutions. energy
consumption
in other rice
mill clusters in
the country.
34 April, 2007
35 April, 2007

No.
 Pos
sibilities in
reduction of
energy
consumption
through
rationalisation
of energy
utilisation.
 Pos
sibilities of
better
recovery and
utilisation of
byproducts
with
appropriate
technologies.
3. Inputs  Eas  High  Incr  Ava
y availability cost of raw easing of yield ilability of low
of raw material (paddy) of paddy with cost of paddy
material and its non- the use of with good
(paddy) & consistency advanced quality in
packaging throughout the agronomic other parts of
material in the year. practice may the country.
state. improve
 Irregu availability of  Imp
 Go lar availability of raw material. osition of
od support consumables higher taxes
from banks, and stores and  Bul and levies
financial its high cost. k purchase of may affect
institutions & raw materials performance
DICs. and of the mills
consumables adversely.
 Res & stores may
ourceful cut cost under
entrepreneurs this head.
capable of
undertaking  Ava
mill ilable
upgradation. institutional
support may
 Sta be exploited.
ble power
supply from
State
Electricity
Board.
4. Innovation  Abil  Low  Par  In
ity to operate willingness to ticipation in absence of
non- adopt new trade fare for induction of
standardised methods & exhibition, innovative
machines technology. training & business tools
supplied by workshops the industry
local and induction may suffer.
fabricators. of QMS etc.
may lead to
higher
productivity,
36 April, 2007

No.
efficiency and
market
opportunities.

No.
5. Human  Ava  Lack  Pro  Poo
ilability of of knowledge in ductivity, r skill base
experienced quality quality and non-
skilled standards. efficiency may compatible to
manpower for be improved handling
the prevalent  Abse with the modern
technology. nce of facilities imparting of advanced
for human skill technical and machinery
upgradation. managerial may
 Inade awareness discourage
quate availability workshops installation of
of trained and skill high capacity
personnel to upgradation sophisticated
operate programmes. imported
sophisticated plants.
machinery like
colour sortex
machine, silky
polishing
machine etc.
6. Infra-  Ver  Poor  Clo  Tot
y good rail & linkage with se al absence of
road R&D institutions interactions linkage with
connectivity for upgradation with the R&D the R&D
with different of product, institutions institutions
parts of the recovery of may improve and also non-
state and valuable operational utilisation of
country. byproducts etc. performance non-
of the mills. conventional
 Pro  High energy
ximity of river unit cost of  Cre sources (rice
ports enabling power affects ation of husk) may
easy exports. the profit facilities for affect the
margin. generation of industry in the
 Exi rice husk
stence of long run.
based biogas
premier R&D to supplement
institute (IIT, the use of
Kharagpur) diesel in DG
working on sets may
process deve- reduce energy
lopments. cost
substantially.
37 April, 2007
38 April, 2007
CHAPTER – V
CLUSTER VISION
5.1 VISION OF THE CLUSTER

THE BURDWAN RICE MILLING CLUSTER ENVISIONS TO ENHANCE ITS
TURNOVER LEVEL BY 150%, PROFITABILITY BY 100%, EXPORTS BY 60%,

REDUCE WASTAGE OF BYPRODUCTS BY 20% AND ENERGY CONSUMPTION BY
5% AND TO CREATE A CLEAN ENVIRONMENT AROUND THE CLUSTER THROUGH
A SUSTAINABLE DEVELOPMENT AND ESTABLISHMENT OF A STRONG FORWARD
AND BACKWARD LINKAGE.
5.2 LONG-RUN OBJECTIVES

The long-run objectives of the cluster are –
 Enhancement of aggregated turnover from the present level of Rs.800 crore

to about Rs.900 crore.
 Increasing the net profit margin of millers from Rs.27.50 to atleast Rs.35.00
per Qtl. of paddy processed.
 Enlargement of exports of rice from the present level of 15% to 24% of total
production.
 Reduction of wastage of 1% of un-recovered rice bran.
 Reduction of energy consumption by 5%.
 Making a clean environment around the cluster.
5.3 STRATEGY OF THE CLUSTER

 Maximisation of yield & production of whole rice and improvement of its
quality through adoption of appropriate technology.
 Reduction in production of broken rice.
 Branding of Govindabhog rice of Burdwan and its positioning in domestic &

export market.
 Efficient recovery and gainful utilisation of byproducts (rice bran and rice
husk).
39 April, 2007
 Improvement in recovery of rice bran and its proper utilisation for oil recovery
inside the cluster.
 Suitable utilisation of boiler ash (rice husk ash) & de-oiled cake from solvent
oil extraction units.
 Undertaking production of value added products like rice powder.
 Development of capabilities for domestic retail marketing & export marketing

through workshop, participation in buyers’-sellers’ meet, trade fair etc.
 Reduction of energy consumption through its efficient utilisation and

appropriate conservation.
 Minimisation of environmental pollution through treatment of waste water and

suitable solid waste disposal.
 Introduction of quality certification like ISO 9000.
 Creation of Common Facility Centres (CFCs) for Testing – cum- Quality

Control Laboratory, Godown for consumables & stores, Ricebran oil
Extrraction-cum- Refining unit.
 Removal of policy level bottlenecks by the association.
 Creation of suitable networks for hiring of Business Development Service

Providers (BDS).
5.4 FUTURE CLUSTER MAP

In order to strengthen the activities in the cluster, it is proposed to bring in some
new cluster actors like the following and also to strengthen the weak linkages as
shown in the existing in the current cluster map: -
 Indian Renewable Energy Development Agency (IREDA)
 West Bengal Renewable Energy Development Agency (WBREDA)
 Indian Institute of Packaging (IIP)
 National Productivity Council (NPC)
 Petroleum Conservation Research Association (PCRA)
 Management Consultant
40 April, 2007
Institutions
SISI & DIC CRRI & IIT Ministry of Food Deptt. of Food Agricultural
Processing & Supplies Deptt.
Banks & FIs APEDA
State Pollution Inspector -Factory Certification agencies
IREDA / WBREDA IIP Control Board & Boilers technical institutions
Forward Linkage Principal Firms Backward Linkage

Central/ State Warehouse
Corporation/ Agencies Spare parts
Large Mills (3) Supplier
Domestic Market
State Electricity
Export Market
Board
Packing Material
Chartered Medium Mills (20) Suppliers
Road Rail Accountants Paddy Farmers
Transport
Labour Paddy Suppliers
Export Contractors from other Districts
Consultant Small Mills (351)
Mgmt. Paddy Suppliers
Testing Consultants from other States
Laboratory
NPC &
PCRA Machinery & Raw
Material Suppliers
BDS Providers
FUTURE CLUSTER MAP
41 April, 2007
CHAPTER – VI
STRATEGIC ACTION PLAN WITH BUDGET

SCHEDULE & ESTIMATES
6.1 STRATEGIC ACTION PLAN
The strategic action plan for the development of the cluster has been made on
the basis of thorough study of the cluster, the findings of which have been
recorded in the preceding chapters. The proposed action plan is based on the
following five major initiatives:
- Trust Building
- Capacity Building
- Marketing Development
- Technology Upgradation
- Creation of Common Facility Centre (CFC)
The action plan includes the following: -
 Formation of Cluster Development Core Committee.
 Publicity & Promotional Programme for the Cluster through publication of

cluster brochure & launching of website.
 Exposure visit to benchmark cluster & other similar clusters for gaining
confidence on cluster activities through knowledge sharing.
 Exposure visit to South-East Asian / South African countries for exploration of

export possibilities and market tie-up.
 Survey / Study for -
- Assessment of requirement of Common Facility Centres (CFC)

- Assessment of market size & prospect of market linkage for rice and other
byproducts.
- Assessment of market size & prospect of undertaking production of value
added products.
 Organising Programmes / Seminars / Workshops on:
- Awareness workshop on cluster development and capacity building of

rice millers’ association
42 April, 2007
- Skill Development Training Programmes on –

 rice milling operations
 operation and maintenance of boiler
 rice husk gasifier
- Technology Demonstration Programmes on advanced parboiling,
mechanical drying & milling operations
- Workshops on –
 Export procedures and documentation,
 Product quality development with the use of colour sortex machine,
silky polishing machine, etc.;
 Efficient rice mill management;
 Export marketing;
 ISO : 9000;
 Environmental Pollution & Energy Saving;
 Value added Products;
 Working capital management;
 Common branding;
 Product packaging for export market & domestic retail outlets;
 Safety measures and hygienic practices.
- Participation in Trade Fairs / Exhibitions
- Organising buyers’ – sellers’ meet
 Establishment of Common Facility Centres (CFC).
- Testing- cum- Quality Control Laboratory for product & byproducts

- Godown for consumables and spares
- Rice bran oil extraction-cum-refining unit
 Counselling, Guidance & Escort Services to the Cluster Actors.
 Exit of Cluster Development Executive (CDE) from the Cluster.
6.2 DEVELOPMENTAL PROGRAMME

SCHEDULE & BUDGET ESTIMATES
43 April, 2007
The proposed action plan will be implemented over a period of three years
commencing from the year 2007-08 till 2009-10. Accordingly, the schedule of
implementation has been drawn up with larger emphasis on capacity building
during the 1st year (2007-08) and subsequently attaching emphasis on marketing
development and technological upgradation during the 2nd and 3rd year (2008-
09 & 2009-10). Exposure visits to benchmark cluster in the country and also to
other developed clusters in the country and abroad have been included in the
programme schedule.
The activity schedule along with estimated fund requirement for development of
the rice mill cluster in Burdwan is presented hereinafter. Also the coordination
expenditure of implementing agency has been separately estimated and
presented.
44 April, 2007
ACTION PLAN & BUDGET: (2007-08)

Executing Estimated Budget & Mode of
Sl. Benefi
Activity Objective Duration Network / Funding (Rs. ‘000) Outcome
No. ciaries
Stakeholders Total DCSSI SG SH
1 TRUST BUILDING
1.1 Awareness Creation of 1 day Association / 75 60.00 8.00 7.00 100 Fixing of time frame
workshop on cluster awareness (Q-1) DIC/ Lead Bank for steps to implement
development amongst programmes.
stakeholders &
networking
1.2 Formation of Cluster Development of 1 month DIC/ 30 24.00 6.00 - 50 Expected that 15
Development Core mutual trust for (Q-1) Association/ members core
Committee and 2 effective Lead Bank/ committee will be
meetings of CDCC coordination and WEBCON formed to look after
monitoring of the cluster
CDP programmes.
implementation
1.3 Exposure visit to Capacity building 10 days Association 150 120.00 15.00 15.00 10 Visiting SHs are
benchmark cluster of the association (Q-3) expected to adopt new
at Kalady (Kerala) by sharing with technology and joint
developed cluster actions from
experience in
benchmark cluster
1.4 Launching of
Sharing of cluster - Core 60 48.00 12.00 - All Information spreading
common website data with (Q-3) Committee/ conce about activities and
concerned WEBCON rned performance of the
individuals and cluster.
groups
2 MARKET DEVELOPMENT
45 April, 2007

Sl. Benefi
No. ciaries
2.1 Buyers-Sellers Meet Market 1 day Association / 100 70.00 10.00 20.00 100 About 20 participants
( 2 Programmes ) development to (Q-3& Market Agents will form consortium to
(50
increase the Q-4) enhance share in
each)
turnover national market.
2.2 Workshop on Export Increasing 1 day Association / 50 25.00 10 15.00 50 About 10 participants
Procedures and knowledge to (Q-4) Market Agents will venture into
Documentation increase the exports.
volume of exports
of rice
3 TECHNOLOGY UPGRADATION
3.1 Survey / Study on Techno- 2½ Consultant 150 120 30 - - Detailed study for
requirement of CFC Economic months justifying the need for
(Testing facility) Feasibility Study (Q-3) CFC.
3.2 Technology Technological 1 day Association / 80 60 10 10 50 Expected that 30 units
Demonstration upgradation by (Q-4) DIC / Lead Bank will adopt a new
Programme on sharing with / Machinery & technology to enhance
advanced parboiling, technology Technology the productivity.
mechanical drying & sellers suppliers
milling operations
3.3 Workshop on Gaining 1 day Association / 80 60 10 10 50 Expected that 20
product quality knowledge on (Q-4) Lead Bank/ DIC/ participants will adopt
development with techniques for Machinery & technique for
the use of colour quality Technology production of improved
sortex machine, silky improvement suppliers quality of rice.
polishing machine
etc. & related
techno-commercial
aspects
46 April, 2007

Sl. Benefi
No. ciaries
4 CAPACITY BUILDING
4.1 Programme on Strengthening 1 day DIC/ 40 32.00 4.00 4.00 50 25 owners are
capacity building of association’s (Q-2) Association/ expected to form
rice miller’s activities for Bank consortium.
association development of
cluster
6 OTHER
6.1 Publication of cluster Creation of - Association / 50 40.00 10.00 - 400 Handbook information
information brochure awareness about (Q-1) DIC/ Lead Bank/ will be used by
various aspects WEBCON stakeholders and
of cluster networking groups.
activities
Grand Total(A): 865.00 659.00 125.00 81.00
Notes:
1. DC = DCSSI, SG = State Government of West Bengal, SH = Stakeholders
2. Action plan for the year 2008-09 is provisional but indicative of likely budget for approval. Based on the learning received during implementation for the year 2007 -08, a
modified action plan for 2008-09 will be submitted for activity based approval towards the end of the year 2007-08.
3. Action plan for the year 2009-10 is provisional but indicative of likely budget for approval. Based on the learning received during implementation for the year 2007-08 and 2008-
09, a modified action plan for 2009-10 will be submitted for activity based approval towards the end of the year 2008-09.
4. Detailed DPR for CFC will be submitted for consideration as per Action Plan.
5. Various local, state and national level technical and financial institutions as well as consultants/ consultancy organisation will be involved in implementing these activities.
Some names are also mentioned against some activities. However these names are not exhaustive.
B) Coordination Expenditure of Implementing Agency
47 April, 2007
Estimated Budget &

Sl. Mode of Funding (Rs. ‘000)
PartIculars
No.
Total DCSSI SG SH
1. In-house institutional staff: Cluster Development Executive (12 1050 840.00 210.00 -
months) / Technical Advisers (6 months)/ Support staff (12 months)
each @Rs.35000/- per month
2. Local travel in the cluster of the in-house staff (150 days @Rs.800/- 120 96.00 24.00 -
per day)
3. Telecommunications (computer stationery, telephone, fax, etc. @ 30 24.00 6.00 -
Rs.2,500/- per month )
4. Local purchases (computer, telephone, fax (L.S., year-wise) 100 80.00 20.00 -
5. Rental of space in the cluster (@ Rs.3000/- per month) 36 28.80 7.20 -
6. Institutional Overhead costs (L.S., year-wise) 180 144.00 36.00 -
7. Miscellaneous incl. Printing, stationery (L.S., year-wise) 60 48.00 12.00 -
Grand Total (B): 1576 1260.80 315.20 -
C) Total Fund Requirement

Fund Requirement
Sl. (Rs. ‘000)
PartIculars
No.
Total DCSSI SG SH
A) Developmental Expenditure 865.00 659.00 125.00 81.00
B) Coordination Expenditure of Implementing Agency 1576.00 1260.80 315.20 -
Total (A + B): 2441.00 1919.80 440.20 81.00
48 April, 2007

Executing Estimated Budget & Benef
Sl.
Activity Objective Duration Network / Mode of Funding (Rs. ‘000) iciari Outcome
No.
Stakeholders Total DCSSI SG SH es
1 TRUST BUILDING
1.1 Updating of Providing - Association/ 20 10 5 5 400 Handbook
Brochure information on (Q-1) Lead Bank / information will be
various DIC/ used by
developmental WEBCON stakeholders and
aspects of the networking groups.
cluster
1.2 Exposure visit to Capacity 10 days Association 150 105.00 15.00 30.00 10 Visiting SHs are
performing cluster at building of the (Q-2.) expected to adopt
Karnal (Haryana) association by new technology and
sharing with joint actions from
developed experience in
cluster performing cluster
1.3 4 CDCC Meetings Programme 4 days Association 12 8 2 2 All Appropriate activities
guidance (Q1-Q4) firms
2 MARKET DEVELOPMENT
2.1 Deployment of BDS Market study for 2½ BDS/ 500 300.00 50.00 150.00 - Study for
for conducting product & months Association ascertaining the
market survey and byproducts (Q-3) market size and
market linkage possible areas for
linkage.
2.2 Workshop on Export Strengthening 1 week CDE/Core 100 70.00 10.00 20.00 50 About 10
Marketing knowledge on (Q-3) Committee/ participants will
export marketing Professional venture into exports.
of product Institutes
49 April, 2007
Sl. Executing Estimated Budget & Benef

No.
2.3 Participation in
Exchange of 10 days Cluster 400 100 50 200 10 Gathering
International trade
ideas and (Q-4) units/CDE/ knowledge of
fair experiences on BDS product quality and
product, market tie up.
machinery, etc.
3.1 Awareness Standardisation 2 days DIC/ Banks / 60 30 10 20 100 25 participants are
workshop on ISO of system of (Q-4) Association / expected to adopt
9000 operation Lead Bank/ ISO certification in
SISI/BIS their mills.
(2 programmes)
3.2 Awareness Reduction of 2 days DIC/ Banks / 80 56.00 8.00 16.00 50 30 participants may
workshop on pollution and (Q-4) Association / adopt pollution
environmental energy Lead Bank/ prevention and
pollution & energy consumption SISI/DBPCB/ rationalisation of
saving Professional energy conservation.
bodies (NPC/
PCRA)
3.3 Awareness Increasing 1 day Association/ 60 42.00 6.00 12.00 40 20 participants may
workshop on value turnover through (Q-4) Banks / DIC/ undertake
added products value addition Govt. production of value
Depts./IIT added items.
4 CAPACITY BUILDING
4.1 NDA for To maintain (Q-1 Association 120 84.00 36.00 - - Effective follow up
Association/SPV communication to and communication
and networking Q-4) will be ensured
activities amongst
stakeholders.
5 COMMON FACILITY CENTRE
50 April, 2007
Sl. Executing Estimated Budget & Benef

No.
5.1 Setting up of CFC for Quality control - Cluster Separate DPR to be submitted for Approval as - At least 80 rice mill
per SICDP norms
Testing & Quality of product & (Q-3) Actors/ owners will come
Control Laboratory byproducts Central & forward to utilise the
State Govt. services of the
Agencies/ facility.
Testing
Equipment
Suppliers
6 OTHER
6.1 Workshop on Management 3 days Association/ 80 56.00 8.00 16.00 40 Around 20
efficient Rice mill Skill (Q-1) Lead Bank/ participants will
Management Upgradation of Banks/ DIC/ adopt advanced
rice mill owners Professional tools for better
Inst. management of their
mills.
6.2 Skill development Skill upgradation 4 weeks DIC/ Banks / 150 105.00 15.00 30.00 30 Operators with
programme on rice of the operators (Q-2) Association / gained skill may be
milling operations Lead Bank/ able to improve
SISI/ Expert performance of the
Professionals mills with regard to
& technicians productivity and
quality.
Grand Total 1682 966 215 501
(B):
51 April, 2007

Estimated Budget &
PartIculars
No.
Total DCSSI SG SH
per day)
Grand Total (B): 1526 1220.80 305.20 -

Fund Requirement
Sl. (Rs. ‘000)
PartIculars
No.
Total DCSSI SG SH
I) Developmental Expenditure 1682 966 215 501

II) Coordination Expenditure of Implementing Agency 1526 1220.80 305.20 -
Total (I + II): 3208 2186.80 520.20 501
52 April, 2007

Sl. Duratio Mode of Funding (Rs. ‘000)
Activity Objective Network / iciarie Outcome
No. n Total DCSSI SG SH
Stakeholders s
1. TRUST BUILDING
1.1 4 CDCC Meetings Programme 4 days Association 12 6 2 4 All Appropriate activities
guidance (Q1-Q4) firms
2. MARKET DEVELOPMENT
2.1 Awareness Promotion of 1 day Association/ 80 56.00 8.00 16.00 50 15 participants may
Programme for Govindabhog (Q-1) Cluster Actors / be interested in
Common Branding rice of Exporters/DIC/ common branding of
Burdwan in Banks Govinda-bhog rice
domestic and produced in the
export market cluster.
2.2 Workshop on Increasing 1 day Association/ 80 56.00 8.00 16.00 50 Entry of around 10
Product Packaging turnover (Q-1) Cluster Actors / participants in export
for Export Market through Exporters/DIC/ market and 15 in
and Domestic Retail marketing of Banks/IIP domestic retail
Outlets rice in the market.
niche market
2.3 Exposure visit to Export market 10 days Cluster Actors 500 100.00 50.00 350.00 10 Around 8 participants
South_East Asian / development (Q-2) may be able to
South African establish export
countries for market tie-ups.
exploration of export
possibilities and
market tie-up
53 April, 2007

Stakeholders s
2.4 Deployment of BDS Techno- 2½ Consultant 200 150.00 50.00 - Assessment of
for Survey / Study on Economic months infrastructure
requirement of CFC Feasibility (Q-2) requirement &
(Solvent oil Study financial involvement
extraction plant with for decision making
refining unit) on creation of the
facilities.
2.5 Deployment of BDS Investigation 2 Consultant 200 125.00 25.00 50.00 Undertaking
for conducting of scope & months production of value
market survey on prospect of (Q-3) added products by 20
value added value added participants.
products of rice mills products of
rice mill
3.1 Workshop on safety Building sense 1 day Association/ 70 49.00 7.00 14.00 50 30 participants may
measures & hygienic of safety (Q-3) Cluster Actors/ be interested in
practices in rice mill measures and Experts adopting operational
hygienic safety measures and
methods hygienic.
3.2 Skill development Technical skill 2 weeks Association/ 100 70.00 10.00 20.00 60 Efficient operation &
training programme upgradation (Q-1) Cluster Actors / maintenance of boiler
on operation & Machinery & gasifier resulting in
maintenance of suppliers overall improved
boiler and rice husk performance of the
gasifiers unit.
(2 programmes )
4 CAPACITY BUILDING
54 April, 2007

Stakeholders s
4.1 NDA expenses for To maintain Q-1 Association 120 60.00 10.00 50.00 - Effective follow up &
Association/SPV communication to communication will
and networking Q-4 be ensured amongst
activities stakeholders.
5 COMMON FACILITY CENTRE
5.1 Setting up of CFC Cost - Cluster Actors/ Separate DPR to be submitted for - Atleast 30 rice mills
(Godown) for minimisation (Q-4) Central & State Approval as per SICDP norms will be benefited
consumables and through bulk Govt. Agencies through centralised
stores procurements procurement system
in the CFC.
6. OTHER
6.1 Workshop on Knowledge 3 days Banks / FI/DIC/ 70 49.00 7.00 14.00 50 Efficient management
Working Capital upgradation (Q-3) CDE of working capital
Management on managing may be adopted by
working 25 participants.
capital
Grand Total: 1432 721 177 534
55 April, 2007

Estimated Budget &
PartIculars
No.
Total DCSSI SG SH
per day)
Grand Total (B): 1526 1220.80 305.20 -

Fund Requirement
Sl. (Rs. ‘000)
PartIculars
No.
Total DCSSI SG SH
I) Developmental Expenditure 1432 721 177 534
II) Coordination Expenditure of Implementing Agency 1526 1220.80 305.20 -
Total (I + II): 2958 1941.80 482.20 534
56 April, 2007
Diagnostic Study R
Annexure – I
List of Stakeholders Interviewed

Particulars Name
A. Manufacturing Units  Subham Industries
 Khsetranath Rice Mill
 Sri Gopal Rice Mill
 Kamala Rice Mill
 Ma Manasa Rice Mill
 Ramakrishna Rice Mill
 Sri Ram Rice Mill
 Alam Gunj Cottage Industries
 Gadadhar Rice Mill
 New Rice Mill
 Shanti Rice Mill
 Nilkantha Rice Mill
 Durga Mata Rice Mill
 Agarwal Small Rice Mill
 Shiva Shakti Rice Mill
 Sarbamangala Rice Mill
B. Raw Materials Supplier  Local Traders

C. Association  Burdwan District Rice Millers’ Association
 Burdwan Chamber of Commerce
D. Machinery Suppliers  Grain Processing Industries (I) Pvt. Ltd.,

Kolkata
 Miller & Merchandise, Kolkata (Agent of G.G.
Dandekar)
 Annapurna Machinery & Mfg. Works, Kolkata
 Indus Industries Ltd., Kolkata
 Savco Mill Stores, Burdwan.
E. Local Buyer Local Traders
F. Technical Institutions IIT, Kharagpur
G. Bank / FIs  Lead Bank (UCO Bank)
 West Bengal Financial Corporation
 State Bank of India
 Punjab National Bank
 State Cooperative Bank
57
Diagnostic Study R
58

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DIAGNOSTIC STUDY REPORT

Directorate of Cottage & Small Scale Industries,

WEST BENGAL CONSULTANCY ORGANISATION LIMITED, KOLKATA

Sl. Title Page

Sl. Title Page

With the increase in production of rice through adoption of scientific system of

1.2 INTERNATIONAL SCENARIO

1.3 NATIONAL SCENARIO

Rice milling industry in India has undergone different phases of technological

Paddy production in three largest producing states in India

Exports of Rice from India

Trend of rice exports from India during 1999-2000 to 2003-04

Mozambique, Malaysia, Nigeria, Russia, South Africa, Saudi Arabia, Singapore,

Export of Non-Basmati Rice from India

Export of Basmati Rice from India

1.4 STATE SCENARIO

Paddy production in major districts of West Bengal

2.1 HISTORY OF THE CLUSTER

2.2 LOCATION OF THE CLUSTER

2.3 OWNERSHIP, SIZE / CAPACITY, INVESTMENTS,

2.3.1 Ownership Pattern

2.3.2 Size / Capacity

Mill Size Distribution in Terms of Capacity

Capacity-wise distribution of mill population in Burdwan district and also in

CAPACITY-WISE DISTRIBUTION OF RICE M ILLING UNITS IN

0 50 100 150 200

CAPACITY-WISE DISTRIBUTION OF RICE M ILLING UNITS IN

2.4 TYPOLOGIES OF THE CLUSTER

2.5 CONCENTRATION OF UNITS

Block-wise Distribution of Rice Mills in Burdwan District

2.6 PRINCIPAL STAKEHOLDERS

2.7 OTHER STAKEHOLDERS

 Paddy suppliers (farmers & traders)

 Packaging material suppliers

 Plant & Machinery suppliers

 Govt. procurement agencies

 Traders of rice, rice bran and husk

 District Industries Centre

 Banks & Financial Institutions

Paddy suppliers (farmers & traders):

Packaging material suppliers:

Plant & Machinery suppliers:

Govt. procurement agencies:

 Department of Food & Supply through the District Controller’s Office

Traders of rice, rice bran and husk:

Only a very small quantity of rice is exported to the neighbouring countries

District Industries Centre

 Central Rice Research Institute (CRRI), Cuttack

 Indian Institute of Technology (IIT), Kharagpur

Banks & Financial Institutions

2.8 PROCESS TECHNOLOGY & FLOW CHART

 Cleaning of Paddy using paddy cleaner & destoner

 Parboiling of cleaned paddy in parboiling plant

For production of ordinary parboiled rice, atmospheric parboiling system is used

FLOW CHART FOR RAW RICE / PARBOILED RICE MANUFACTURE

For Parboiled Rice

For Raw Rice

For Raw / Parboiled Rice Parboiling

Cleaning Dehusking Husk Seperator Husk

Bran Separator Bran

Whole Rice Broken Rice

Weighment & Weighment &

Process Flow Chart for Super Quality / Export Quality Rice