PROJECT SHAKTI GAON

(A Gate-Way to Self Employment)

CONCEPTUAL BACKGROUND :

In an attempt to reduce rural poverty through self employment,

Swarna Jayanti Gram Swarozgar Yojana (SGSY), a group based scheme, has
the greatest advantage of pooling resources from individual members
thereby strengthening the collective enterprises with need based linkages.
The enterprises those are taken up by the SHGs are either resource based
(e.g. Agri/MFP etc.) or skill based (e.g. handloom, handicrafts etc.) But
besides these there are quite a large number of vibrant SHGs (about 30% to
40%) having neither of the above two but they need to be strengthened.
There are few success models emerged in the mean time. One of them is the
Project Shakti Gaon – A corporate initiative with Indian Oil
Corporation Ltd.
Initially the project has been started in Ganjam District as an
enterprising district. The Dealership of the gas has been offered to District
Supply & Marketing Society (DSMS), the district unit of ORMAS. Selected
SHGs are taken as Extension Counters in the block level. These SHGs were
covered under SGSY and linked to banks and B’MASSs for credit facility.

THE PROJECT PROPOSAL

Fixed Capital Requirement

1. Retail Shop / Showroom : Provided under SGSY

Infrastructure by DRDA or taken on rent.
2. Security deposit of SHGs with DSMS for allocation of
retail extension counter

Rs.

25000.00
3. Trolley – 2 Nos. @ Rs. 5000.00

Rs.

10000.00
4. Show Room / Office Equipments

Rs.

10000.00
5. WLL Phone Connection

Rs.
 2000.00
6. Electricity Connection

Rs.

3000.00
Total Fixed Capital

Rs.

50000.00

Recurring Expenses per annum

1. Rent for Show Room @ Rs. 300.00 p.m. (expecting it to

be available and no need to construct new one)

Rs.

3600.00
2. Electricity Charges @ Rs. 200.00 p.m.

Rs.

2400.00
3. Telephone & Postage, Xerox Charges @ Rs. 300.00
p.m.

Rs.

3600.00
4. Stationery & Misc. Expenses @ Rs. 100.00 p.m.

Rs.

1200.00
5. Depreciation cost of fixed capital @ 10%

Rs.

5000.00
6. Interest on Fixed and Working Capital @ 11%

Rs.

9900.00
7. Misc. Expenses
 Rs.

3400.00
Total Recurring Expenses

Rs.

30000.00

Working Capital Requirement

1. 3 Months’ recurring expenses

Rs.

7500.00
2. 50 Nos. of Stove @ Rs. 200.00 per stove

Rs.

10000.00
3. 90 Nos. of Gas Refilling @ Rs. 100.00 per filing

Rs.

9000.00
4. 50 Regulators @ Rs. 100.00 per Regulator

Rs.

5000.00
5. Spare parts including pipes

Rs.

8000.00
Total Working Capital Requirement

Rs.

39500.00

Total Capital Requirement (Fixed + Working)

Rs.

89500.00

Or Say
 Rs.

90000.00

YEAR-1 PROJECTED INCOME & EXPENDITURE STATEMENT :

Income

1. Net Income from new connections for 1000

connections @ Rs. 140.00 per connection

Rs.

140000.00
2. Margin Income from Refilling for 6900 Cylinders @ Rs.
5.00 per refilling

Rs.

34000.00
3. Net Income from spare parts @ 10% of total Rs.
60000/-

Rs.

6000.00
4. Service / Repairing etc.

Rs.

6000.00
Total Income

Rs.

196000.00

Expenses

1. Recurring Expenses

Rs.

30000.00
2. Gross Income in 1st Year

Rs.
 166000.00
3. Reserve for future business (10% of the net income)

Rs.

16600.00
4. Net Income of the SHG

Rs.

148400.00
5. Income per beneficiary per annum

Rs.

14840.00
6. Income per beneficiary per month

Rs.

1240.00

The income of each member in the SHG could go up with more and
more gas connetion and adding the products of other corporate bodies. It
would also earn through its involvement with insurance, e-sanchar, agri-
centers etc. it is expected that, at the end of three years, each Swarojagary
would be able to earn about Rs. 1600.00 to Rs. 1800.00 per month.

THE ECONOMY :

Receipts, Expenditure and Net Income per Cylinder in Rupees.

Receipts

A. New Connection – 5 Kg. Cylinders

1. Deposit per Cylinder Rs. 350.00
2. Deposit per Regulator Rs. 100.00
3. Blue Book (Membership) Rs. 10.00
4. Installation Rs. 20.00
5. Pipe (1.5 Mtr.) Rs. 30.00
6. Stove (Single Burner) Rs. 300.00
7. Filling of Gas Rs. 99.00
Total Rs. 909.00
Expenditure

B. Payments to DSMS – The Dealer

1. Deposit per Cylinder Rs. 350.00
2. Deposit per Regulator Rs. 100.00
3. Blue Book (Membership) Rs. 5.00
4. Pipe (1.5 Mtr.) Rs. 20.00
5. Stove (Single Burner) Rs. 200.00
6. Filling of Gas Rs. 94.00
Total Rs. 769.00

Net Income per new connection (A – B) Rs. 140.00

Refilling

Margin to SHG per cylinder Rs. 5.00

SHGs COLLABORATED WITH IOCL THROUGH DSMS

This is the first corporate initiative taken up by ORMAS wherein DSMS

Ganjam is the distributor of IOCL and the SHGs are the extension counters. 25
SHGs involving 334 members have been selected in the district, which is
spread over in 20 blocks of Ganjam. The extension counter functions from the
Training cum Production Center in the block and few at some main market
places. This project was formally launched on 7th April’2004.

TRAINING TO SHGs

Training programmes were held in collaboration with IOCL and RUDSET

Institute in three phases in the three subdivisions of Ganjam. The Training
covered various aspects of LPG Dealership, Book Keeping, Usage of LPG,
Safety Measures etc. and RUDSET Institute imparted one day training on
Entrepreneurship Development. Further training are been chalked out to horn
their skills further specially on book keeping and sales technique.

INFRASTRUCTURE BACK-UP

For this project a Godown of 8000 Kg. capacity has been constructed at
Chatrapur and one Showroom has been provided in the DRDA campus to
DSMS by DRDA out of SGSY Infrastructure Fund.
For transportation of Cylinders from the godown to various extension
counters, one Mini Truck is hire on requirement basis for distant places and
also one Tata Mobile that is provided by ORMAS is used by DSMS Ganjam. But
analysis shows that transportation cost is quite high. Hence to reduce the
transportation cost and fill the critical gap a proposal has been submitted for
purchase of one Mini Truck.
 REAL GROUP ECONOMY : An Insight into Maa Mangala SHG of
Rangeilunda Block

Maa Mangala SHG has been selected under Project Shakti Gaon &
financed under SGSY in May-2004. This SHG works through the Extension
Counter at the Training cum Production Center of Rangeilunda Block. This
group is a progressive and cohesive group. Prior to taking of this activity the
SHG members were involved in Badi, Papad making. This project will give
them an additional income to their existing income of Rs. 300/- on an average
earned from the sale of Badi/Papad.

Profile of the SHG :

Name of the SHG Maa Mangala
Name of the Village Haladiapadara
Name of the Block Rangeilunda
Date of Formation Dec-2001
Total Member 11
Savings of SHGs 25000/-
Credit Linkage Status :
Loan availed from MASS
1st Loan taken on 17.01.2003 Rs. 10000.00 (Cleared in 9 Months)
2nd Loan taken on 30.01.2004 Rs. 30000.00 (Cleared up to Rs. 23000/-)
Financed under SGSY May – 2004
Shakti Gaon Project Cost Rs. 90000.00

Profit from Shakti Gaon Project

Profit from 14.2 Kg. New Connections Rs. 140 X 141 = Rs. 19740/-
Profit from 5.0 kg. New Connections Rs. 92.75 X 9 = Rs. 834.75
Profit from 14.2 Kg. Refilling Rs. 10 X 400 = Rs. 4000/-
Profit from 5.0 Kg. Refilling Rs. 5 X 122 = Rs. 610/-
Total Profit earned so far Rs. 25184.75

Out of the total profit they have repaid Bank Loan of Rs. 9000/-

The group actually started work from June’2004 and for a brief period
during August and September, due to some crisis of Oil Companies,
Regulators were not given at all. Restriction on cylinders had also been made.
Hence new connections was given from October. Therefore the profit is based
on 6 months. Therefore an income of around Rs. 400/- is being earned now.
This income is substantiating their income of Rs. 300/- per member earned
from Badi, Papad. An average income of Rs. 700/- is being earned now.

MEASURES TAKEN FOR ENHANCING CONSUMERS

 To increase the number of new connections, banks are coming forward

to finance SHGs to purchase Cylinder.
 For purchase of one new connection the amount required is Rs. 1965/-
and if a customer wants a double connection, cost comes to Rs. 3115/-.
  For SHGs to avail a connection is itself a prerogative option. Hence RGB
has formulated a Loan scheme for purchase of Gas connection which
has been transmitted to all blocks to implement the scheme.
 To further improve their incremental income, discussion are on with
other corporate houses like Colgate Palmolive, HLL etc.
 Awareness campaigns for usage of LPG in remote areas and easy
access to cylinders are being chalked out.

A MODEST BEGINNING !!

This project is an effective strategy for penetrating in rural areas and

reduce drudgery of rural women. This is also a means of sustainable
livelihood. This initiative further helps in reducing deforestation. This project
is a stepping stone in the direction of creating self employment opportunity
for rural women.

DISTRICT SUPPLY & MARKETING SOCITY

Activities Undertaken