Forest-Based Livelihood Empowerment: Van Dhan Yojana in Uttar Pradesh

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Project Details

Category: Tribal Development
Project Title: Pradhan Mantri Van Dhan Yojana – Uttar Pradesh Forest Corporation
Department or District: Uttar Pradesh Forest Corporation, Government of Uttar Pradesh
State: Uttar Pradesh
Start Date of the Project: 01 April 1983 (Van Dhan Yojana as part of UPFC’s activities was launched later under MOU with Government of India)
Website: https://upforestcorporation.co.in/

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Tribe(s) that the Project Covers: The project focuses on engaging and empowering tribal and local forest-dependent communities across 16 districts of Uttar Pradesh, including backward and forest-rich areas such as Sonbhadra, Chitrakoot, Lalitpur, Mahoba, Mirzapur, and Varanasi.

Keywords: Tribal Livelihoods, Forest Produce, SHGs

The Uttar Pradesh Forest Corporation (UPFC), a state-owned enterprise under the Uttar Pradesh Forest Corporation Act, 1974, has undertaken the implementation of the Pradhan Mantri Van Dhan Yojana (PMVDY) to generate sustainable livelihood opportunities for tribal and local forest-dependent communities. Operating within a broader mandate of forest conservation and scientific exploitation, UPFC’s Van Dhan Yojana initiative focuses on mobilizing tribal communities into Self-Help Groups (SHGs), enhancing their traditional skills, training them in value addition and packaging of Minor Forest Produce (MFP), and linking their products with retail markets. The scheme is backed by a dedicated budget and institutional support for long-term scalability and community ownership.

The Project

Under the Van Dhan Yojana, UPFC has signed a Memorandum of Understanding with the Government of India for implementation of the Minimum Support Price for Minor Forest Produce scheme in Uttar Pradesh. As the nodal executing agency, UPFC has taken a lead in creating Van Dhan centers across tribal-dominated districts. The project seeks to enhance the socio-economic conditions of tribal communities through capacity-building, product innovation, entrepreneurship, and market integration. A total of 25 Van Dhan centers have been established, with 14 of them being especially active, involving 195 SHGs and over 4200 members. These centers facilitate skill development, product diversification, and structured marketing through UPFC’s infrastructure and digital platforms. The corporation also runs sales depots and retail outlets, promoting tribal-made products across the state.

Problems that it Intends to Solve

The project was conceptualized to resolve the long-standing marginalization of tribal forest produce gatherers who lacked market access, fair prices, and institutional recognition. Traditionally, tendu patta collectors and MFP gatherers were dependent on private contractors and middlemen who exploited their labor, paid them poorly, and excluded them from value chains. The project also aimed to address the challenges of storage-related losses, lack of organized processing and packaging, and the absence of formal training in entrepreneurship among tribal communities. Digital illiteracy and bureaucratic hurdles in opening bank accounts for SHGs further compounded their economic exclusion.

What was the Need

The economic vulnerability of forest-dependent tribal communities and the underutilized potential of forest produce formed the central rationale for launching this project. Uttar Pradesh’s tribal pockets possess abundant natural resources, including herbs, tendu leaves, fruits, and bamboo, but these were historically traded without value addition or structured marketing. Recognizing this gap, UPFC initiated a project that could link tribal knowledge with modern marketing strategies and institutional finance, ensuring that forest wealth directly benefits the forest dwellers. The need was also driven by the national policy direction on tribal empowerment through forest-based entrepreneurship under the PMVDY scheme.

What Hindered its Introduction

Initially, the creation of Van Dhan centers was delayed due to difficulties in community mobilization, the formation and registration of SHGs, and logistical issues in opening bank accounts. The lack of adequate staff and field-level support teams slowed progress. Tribal communities also had limited awareness of the scheme and were skeptical about government-led livelihood initiatives due to past experiences with irregular payments and bureaucratic processes. Additionally, branding, packaging, and economic marketing of forest products posed technical challenges in the early phases.

Process Followed for Implementation

To implement the scheme, UPFC collaborated with the Tribal Cooperative Marketing Development Federation (TRIFED) and the Ministry of Tribal Affairs. The process began with identification of suitable districts rich in MFP, followed by the mobilization of tribal groups into SHGs. These groups were provided with formal training in packaging, processing, hygiene, and financial literacy. Van Dhan centers were equipped with the required tools and infrastructure using a dedicated state budget. A digital ERP module was introduced to manage the collection and disposal of forest produce, while direct benefit transfer systems were set up to ensure timely payment to gatherers. Simultaneously, product lines were developed that combined traditional recipes with commercial viability, such as ginger barfi, bamboo jewellery, and millet-based snacks.

• Government
  • The project is led by the Uttar Pradesh Forest Corporation under the aegis of the State Government. The corporation works closely with central government agencies for funding, policy guidance, and capacity-building support. It serves as the nodal agency for implementation and governance of the PMVDY scheme in Uttar Pradesh, ensuring compliance with national directives and local operational effectiveness.
• Involvement of Community
  • Community participation is central to the project. Tribal members are organized into SHGs and Van Dhan groups, and their active involvement in product selection, processing, and marketing decisions is encouraged. Members receive ongoing training, and some groups have taken up entrepreneurship independently after capacity-building sessions. The scheme has impacted over 7500 people, providing them with new skills and a pathway to self-reliance.

Solutions Implemented

Key solutions included digitized wage disbursement through direct bank transfers, thereby eliminating middlemen. SHGs were provided with passbooks and dedicated accounts to improve financial inclusion. An ERP system was developed to track produce collection and sales. Advance sale of tendu leaves was implemented to reduce storage costs and avoid spoilage. Strategic branding and packaging initiatives were introduced to raise product appeal. Dedicated sales outlets and digital auction platforms expanded market access.

Details of the Coverage

The project currently spans 16 districts in Uttar Pradesh and has operationalized 25 Van Dhan centers. Out of these, 14 are designated as active due to consistent participation and output. A total of 195 SHGs have been formed with 4200 members, and over 7500 individuals have benefited directly. Future plans include expanding to 53 centers and involving over 15,900 people across the state.

Innovation and Unique Features

The innovation lies in combining traditional tribal knowledge with formal institutional mechanisms. Advance sale mechanisms reduced overheads, and the ERP system allowed real-time tracking of produce. Product innovation led to the creation of region-specific items such as mahua ladoos and herbal powders. The training curriculum integrated IT skills, entrepreneurship, and hygiene management. Retail linkages were facilitated through state-owned marketing platforms, reducing dependency on external vendors.

• New Approaches: Tech integration, capacity building, culturally sensitive methods
  • Technological tools such as ERP for inventory management and digital wage payment were integrated into the scheme. Capacity-building programs included training in packaging, branding, IT literacy, and business practices. The project respected tribal traditions by incorporating indigenous food products and crafts, and emphasized community ownership over assets.
• Co-creation: How tribal knowledge or leadership shaped the solution
  • Tribal communities contributed their expertise in identifying valuable MFPs and traditional recipes. Products like ginger sweets, herbal powders, and bamboo jewellery emerged from community suggestions. SHG leadership played a role in defining workflows, coordinating sales, and maintaining transparency. Local champions emerged as business leaders within the centers.
• Any adaptations: How the project evolved during implementation
  • Based on early learnings, UPFC modified its implementation strategy by simplifying SHG account opening processes, allocating more resources to training, and setting clearer quality control guidelines. Additional centers were added based on district-level performance, and existing centers were upgraded with modern equipment. New product lines using millets were developed for upcoming phases.

Challenges Faced Before Implementation

• The major internal challenges were logistical in nature. Lack of field staff, limited digital infrastructure for monitoring, and initial ambiguity in operational protocols slowed down early progress. SHG registration and coordination across departments required significant institutional streamlining.
• Externally, there was resistance from tribal communities due to historical exploitation, limited awareness of digital tools, and apprehensions around market sustainability. Account opening for SHGs and financial documentation were difficult in remote locations.
• The project responded with hands-on support for account opening, mobile-based training modules, and awareness drives. Field staff from the Forest Department supported SHG formation and training. Branding and product demonstrations were conducted in local Haats and public forums to build trust and demand.

Challenges Faced During Implementation

• Sustaining consistency across Van Dhan centers, ensuring quality packaging, and managing procurement cycles were key internal challenges. Staff rotation and data entry gaps also emerged as recurring issues.
• Product transportation, especially from remote areas to central sales hubs, posed difficulties. Seasonal availability of MFPs affected steady income generation. Regulatory approvals for food products were also a barrier.
• UPFC streamlined transport logistics and established buffer stocks. Training was extended to include regulatory compliance and shelf-life management. Dedicated branding teams were introduced for product promotion.

Outcomes

• The initiative has reached over 7,500 beneficiaries, formed 195 SHGs, and activated 25 Van Dhan centers. Sales volume and profit tracking are under ERP, ensuring accountability. Thousands of transactions are processed digitally, ensuring transparency and efficiency.
• Tribal communities now enjoy direct market participation, increased income, and skill development. Traditional knowledge is preserved and monetized. Women’s participation has surged in areas like food preparation and jewellery design. The community’s confidence in institutional processes has markedly improved.
• Monitoring is conducted via ERP systems and field-level audits. Periodic reviews are undertaken to track output, SHG functionality, and beneficiary engagement. Training outcomes are tracked through feedback loops.
• Direct beneficiaries include tribal forest produce gatherers, women’s SHGs, and local entrepreneurs across 16 districts. The project is designed to benefit 15,900 individuals in its expanded phase.

Replicability / Scalability / Sustainability

• The initiative aligns with the Ministry of Tribal Affairs’ PMVDY framework and supports state policy goals on tribal livelihood enhancement.
• With budgetary allocations for training, marketing, and center operation, the scheme is designed for long-term sustainability. Sales revenue is partially reinvested into center operations.
• The model is being expanded to 53 centers. Its design is scalable to other states with forest-based communities, particularly in Jharkhand, Chhattisgarh, and Odisha.

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