At the same time, it had decided to pay bonus to 55 cottonseed growers for not engaging child labour, according to Clive J Pegg, managing director of Proagro.
The action plan of Proagro includes a scheme of incentives and disincentives to their contract farmers.
Under the scheme, the company will pay the farmers a 5 per cent bonus on the procurement price if they discontinue engaging child labour. If the farmers used child labour, the bonus is canceled and the procurement price is cut by 10 per cent.
If farmers continue to violate the ‘no-child-labour’ norm, the company will completely reject seeds from them and no future production contract will be entered into with them.
If farmers in a particular village come forward to totally eliminate child labour on their farms, the company will reward the entire village by extending financial support for building educational infrastructure like schools and supplying educational material.
At present, 139 contract farmers spread over 30 villages in Andhra Pradesh are engaged by Proagro in the production of cottonseeds in an extent of 275.5 acres.
Pegg told Business Standard that the company’s action for 2006-07 was aimed at completely eradicating child labour from all the Proagro cotton seed production fields and the integration of the children into mainstream education, providing leadership to the industry in socially responsible cottonseed production and ensuring sustainable cottonseed production for all stakeholders in Proagro supply chain.