India's Araku coffee to debut in Paris market under exotic brand
21 Feb 2017
Araku Valley, Andhra Pradesh, India
One hears of cooperative farming where government, NGOs or corporate entities provide resources or knowhow to support cultivation. But in the picturesque and protected Araku Valley of Andhra Pradesh, a unique agri enterprise has taken shape. Tribals from this region, with the backing of four business leaders, are growing top-notch quality coffee, which will make its debut overseas this week under an exotic brand.
Anand Mahindra (chairman, Mahindra & Mahindra), Kris Gopalakrishnan (co-founder, Infosys), Satish Reddy (chairman, Dr Reddy's Laboratories) and Rajendra Prasad Maganti (chairman, Soma Enterprise, a construction company) have joined hands to form an enterprise that will launch Araku coffee's first store in Paris. For the 150-odd tribal communities living in the Maoist-infested belt, the global debut is a big step forward.
Until 15 years ago, their life was dependent only on collecting forest produce. A predominantly tribal area (including the Bagathas, Valmikis, Kondus and Poorjas) in Visakhapatnam district, the Araku region is classified as an agency area; the government has created a special developmental and funding plan for locals. All the land here belongs to the government and a tribal is entitled to get land as much as s/he can till for free, to earn a living. Coffee cultivation is not new to the area—the British did it and the government continues to grow the beans under its own brand, but it was only in the recent past that tribals tried their hand at it on a large scale. From 1,000 acres some years ago, the land under coffee production has gone up to 20,000 acres. The four investors have stepped in to assist them in increasing bean production by roping in global experts. "We want to make Araku a gourmet coffee brand, acceptable in global markets and that's why we chose Paris for the debut," Mahindra told TOI, adding that the profits made from the venture will be ploughed back to improve the quality of the farmers' lives. Araku will be sold under five variants with the most expensive stock priced around Rs 7,000 a kg. The steep price can be justified by the fact that this is perhaps the first time in the world that coffee is being produced using techniques similar to those in wine making. Like unique tastes of different wines identified by the soil in which the grapes are grown, the variants of Araku coffee also draw their flavours from the 'terroir' or unique environment. "Araku coffee is unique because of its complex terroir and that's why premium. Everybody wants a simple life but they pay for complex things. Luxury is all about complexity," Mahindra said.
Araku coffee was originally a nonprofit venture supported by Naandi Foundation, the brainchild of Andhra Pradesh chief minister Chandrababu Naidu and Anji Reddy, founder of Dr Reddy's. The late Reddy brought Mahindra into Naandi and the chairman of the auto major, along with the other three investors, soon transformed the social enterprise into a for-profit venture.
"Give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime. All these are passe. I believe it is now time for private enterprise at shared value, which I call 3.0," Mahindra said.
Araku coffee has already got a geographical indication (GI) tag, which authenticates the unique properties a region can offer to a product. But until now, the Arabica coffee produced by the tribals was being sold in bulk to roasters who were ready to pay a premium for this brew.
Plan is to launch the next set of retail stores in New York and Tokyo, which means the world famous Columbian and Sumatra coffees will soon have competition on the shelf from a little-known region called Araku in India.
Source: Times of India