Carnation I. SALIENT FEATURES 1.

Potential Centres

NASIK / PUNE / BANGALORE / DELHI Other locations could be selected based on parameters indicated in the project.

2. Export Oriented innovative technology

Import of most popular varieties Cultivation inside plastic greenhouse under ultra high densities, 33/m2 with drip irrigation Grading, packing, precooling, storage and transport as per European standards.

3. Estimated cost/ha.

A. Fixed cost Rs.45.00 lakhs. B. Recurring cost Rs.23.70 lakhs (only for 1st year) TOTAL cost Rs.68.70 lakhs

4. Project Benefit/Ha./Year Yield (No. of Export Quality stem/ha.) Year 1 Year 2 Year 3 - 15 5. Export Markets Europe, U.S.A., Japan, Singapore, Hongkong and Middle East. 6. Financial Viability Nil 13.82 lakhs 15.55 lakhs Gross Income (Price Rs.5/stem) Nil 69.10 lakhs 77.50 lakhs

BCR : 1.15 NPW : Rs. 48.44 lakhs IRR : 31%

7. Repayment In 6 years with moratorium for the 1st year. 1. Introduction Cut flowers are flowers which are grown and harvested for ornamental purposes i.e., for use in preparation of bouquets, floral arrangements, worship and social occasions. They are highly perishable commodity and most commonly used as fresh product; the use of dried cut flowers is very limited. There are about 80 species of plants which produce commercially important cut flowers. The top ten cut flowers in international trade are roses, chrysanthemum, carnation, tulip, lily, freesia, gerbera, gypsophilla, cymbidium, iris, gladiolus, anthurium and narcissus. The varied agro-climatic conditions in India can permit commercial cultivation of all these flowers either in open field or under protected conditions. However, the commercial cultivation of cut flowers in the country has so far been restricted to rose, chrysanthemum, jasmine, marigold, tuberose and gladiolus, mainly due to near absence of domestic market for other flowers.

2. Export potential The international trade of cut flowers was estimated to be US $ 2.34 billion during 1990. The market has been growing at the rate of 10% per annum. The current export of cut flowers from India is reported about Rs.2.50 crores only (1990-91). Potential of world market for all floricultural products has been estimated to be US $ 50 billion with a 15 percent annual growth rate. In view of a number of strong points, in favour of India, namely varied agro climate, skilled manpower, proximity to consuming markets, the Ministry of Commerce, Government of India has identified floriculture, which includes cut flowers as an extreme focus segment for boosting export from India. The Expert Group set up by Planning Commission has proposed an annual export target of Rs.100 crores for cut flowers. 3. Export Market

The main importing countries for cut flowers are Germany, France, UK, USA, Switzerland, Italy, Austria, Denmark, Sweden, Belgium/Luxembourg and Japan (in order of the volume of imports). The main exporting countries are Holland (70%), Columbia (9.2%), Israel (5.8%), Italy (4.9%), Spain (2.3%), Kenya (1.4%) and the Canary Islands (1.1%). The five flowers, namely, rose, chrysanthemum, carnation, tulip and lily account for 70-75 per cent of the world trade. The target markets for cut flowers identified by the floriculture committee of the Commerce Ministry are Europe, Middle East, USA, Japan, Far East (Hongkong, Singapore).

4. Objectives of the project The primary objective of the present project is to extend financial assistance for adoption of export oriented technology for cultivation of carnation, which ranks second/third in the world trade, so as to promote export of carnation flowers from India. 5. Potential Centres The selection of location for production of carnation or any other flower for export purposes depends mainly on three factors;

cost of production quality cost of transportation.

Only the production of high quality flowers at low cost can face the international competition. Based on these considerations, the location for the production should be decided. Areas around Pune, Nasik, Bangalore and Delhi have been identified by experts as most potential centres for cultivation of carnation. The other locations can also be selected on the basic factors indicated above. 6. Beneficiaries Targeted beneficiaries could be individual entrepreneurs / partnership firms / companies / cooperatives. Technical / marketing tie-up with foreign firms / Indian Research Institutions / export houses would be desirable. Services of qualified / experienced floriculturists are essential for the success of the project. 7. Export Oriented Technology The success of export oriented projects on any fresh produce will depend, among other things, on the adoption of innovative technology for both production and post harvest management. Salient features of the

technological innovations that might be followed are outlined below. 7.1 Pre-harvest Technology 7.1.1 Selection of species and varieties While any of the species indicated in the preceding paragraphs could be selected for production of cut flowers in appropriate locations, the present model has been prepared for growing carnations. Its popularity ranks among the top three cut flowers in the West. It is loved for its exquisite form, beauty and clove like fragrance and good vase life. The varieties which were very popular based on the recorded volume of sales in the auction centres of Holland during 1989-90 are enumerated below. Standard Carnation Desio White sim Pallas Londorga Castellaro Nora Barlo Tanga Lontarion Manon Korosa Sandrose Candy Klekopi Candy Klemaxi Kletouwi Sarina Lonseva Karina Hilkari Barbara Hibacer Elsy Londoure Bagatel Wesbag Eveline Hilsucces Silvery Pink Madea Lior Aroiler Salmony Stasalm Bianca Starlight Hilstar Spray Carnation

Most of the varieties of carnation are photo-period insensitive. Ideal temperature requirement is about 10o C in the night and 23o C in the day. High light intensity with a 12 hour day length may produce top quality flowers. 7.1.2 Soil Carnation thrives best in well drained soil with soil reaction from neutral to slightly alkaline. 7.1.3 Plastic Greenhouse Carnation for export has to be grown under protected cover, not in open field conditions. In the West Almost entire carnation production takes place in glass green house, which enables fill control over climate. However, Colombia has shown that good quality carnation can also be grown under plastic green house, which is cheaper than glass green house. As a result, Colombia has captured a great deal of USA's carnation market. A grower at Nashik has recently demonstrated that India can also grow carnation of international quality in plastic green house. The suggested design is displayed in Exhibit Nos.III and IV. Actual design should take into account wind direction and wind velocity. The roofing material could be Low Density Polyethylene (LDPE) of 200 micron thickness. One kg. of this material covers 5.37 sq.m. LDPE has to be replaced every alternate year. The basic structural material could be M.S. angle iron of 40 x 40 x 5 mm size. The structure could also be made of wood, wherever, requisite quantity is available, in which case the cost would be brought down further. Construction could be phased out depending on planting programme in the 1st year. 7.1.4 Layout

Carnation might be grown in raised bed of soil. The suggested design is given in Exhibit Nos.I and II. This would allow 72% utilisation of land. 7.1.5 Size of Unit The minimum size proposed in the model is 1 ha. area of plastic green house, based on sizable volume of export and cost of infrastructure and its efficient utilisation. The other technical parameters could be as under :7.1.6 Spacing : 20 cm x 15 cm Main planting In 3 or more phases Season August, September, October 7.1.7 Manure : 10 kg/m2 Fertilisers Nitrogen } 200 ppm at 15 days internal Potash } with irrigation Phosphate : 700 kg. in two splits Boron (Borax) : 38 ppm 7.1.8 Irrigation doses : 20 litre/m2 (twice a week) Design of Drip system One lateral line (10 mm) in every alternate row Micro tube : 2 litre/hr. Main line : 30 mm 7.1.9 Plant Protection Diseases : Pythium Pythopthora rot Fusarium wilt Fusarium stem rot Alternaria blight, Grey mold Pests : Aphid Meanlybug Spidermite Thrips

White fly Control : (1) Soil sterilisation - Chloropicrin (2) Dithane - 0.6 gm/litre (3) Metasystox - 1.25 ml/litre (4) Karathane - 1.00 ml/litre Volume of preventive spray - 1500 litre/spray Frequency - 50/year i.e. once in a week 7.1.10 Other practices Staking, Inter culture, Detopping, Debudding 7.2 Harvest and Post-harvest Management Until recently, in the absence of scientific post-harvest management, cut flowers used to be grown in places near to the markets. There has been veritable sea-change in the situation during the last twenty years or so. Flowers grown in the far eastern part of Thailand are being exported as far away as ''Aalsmer'' in Holland. This could be attributed to the improved post-harvest management of cut-flowers. The post harvest management actually starts with harvesting of flowers. 7.2.1 Harvest Carnation flowers mature in 4-5 months period. Standard cultivars are harvested at ''Paint Brush'' stage with half-open flowers, or almost fully open flowers. Spray cultivars are harvested when there are 2 fully open flowers on the stem. Standard carnations can also be harvested at the stage of mature, large but tight buds with calyxes filled with petals or buds with petals just beginning to appear on the upper portion (i.e. at ''cross'' stage). Such buds may be stored under dry condition for 5-6 months (except yellow colour varieties). Flowers partly open when harvested at the star stages with petals emerging about 0.5 cm above calyx, may be stored upto 8 weeks. Flowers destined for storage should be free from diseases and pests. Harvesting should be done in the early morning and/or in the late afternoon, and they should not be wet at harvest. Immediately after harvesting flowers should be placed in a bucket of clean water inside the green house and transported to the grading hall. 7.2.2 Grading After harvest, the flowers should be graded to different classes according to their qualities. The European Community's common quality standards for fresh cut flowers have been given in Annexure 1. For flower export company, grading hall/shed is essential. Grading tables, enable the grading of flowers according to their sizes. It is normally sufficient to have a smooth table marked with the length of each grade. 7.2.3 Flower Preservatives All cut flower auction centres in Western Europe require flowers to be pretreated with Silver Thiosulphate Solution (STS) or some other floral preservatives. The preservatives promote longevity and quality of cut flowers. They are mainly composed of sugar, germicide, STS, weak acid and growth substances. Concentration of preservatives are indicated below :i) 8-Hydroxquinoline sulphate or Hydroxyquionoline citrate 200-600 ppm ii) STS - 0.2-4mM. iii) Cytokinin - 10-100 ppm.

iv) Sugar - 0.5-2% v) Citric acid - 50-100 ppm. 7.2.4 Packing Packing comprises three stages : bunching, wrapping and packing. The exact number of stems stipulated per bunch i.e. 5,10, or multiples of 10 pieces should be tied with a rubber band at the base of the stems. The bunches may be wrapped in paper. Plastic can promote fungal attack. However, wrapping is not essential. Many different cardboard boxes are used for packing. For long-term transport, it is best to use telescopic style boxes made of corrugated fiberboard. Boxes must be strong enough to support the weight of at least 8 full boxes placed on top of one another under conditions of high humidity. Special boxes equipped with a container for water in which flowers are held in a vertical position have been developed in the West. The ends of flowers can also be placed in absorbent cotton saturated with water and enclosed in waxed paper or polyethylene foil (0.004-0.006mm. thick) which permits air exchange. All gaps inside the boxes should be filled with shredded paper. Boxes used during forced air cooling must have vents on either side. Total vent size should equal 4-5% of the area of the end wall of the box. 7.2.5 Pre-cooling After packing, the flower should be pre-cooled as soon as possible. Since temperature reduction from flowers is a rather slow process and metabolism may continue even at a low temperature, the heat from the freshly harvested flowers needs to be removed rapidly before shipping or storage. Pre-cooling is that rapid removal of field heat to bring the produce temperature down to or near to its subsequent storage or shipping temperature. Precooling units are available that can cool from 4 to more than 100 boxes of flowers in less than 1 hour as against the requirement of 12-24 hours if the boxes are stalked. The pre-cooling equipments can be installed in cold store or a separate pre-cooling chamber can be constructed alongside cold store. In the present model separate built-in pre-cooling and cold store units, which would be kept in grading shed have been suggested. Of the various methods of pre-cooling, forced air cooling is considered as the best for cut flowers. This operates by forcing cold aid through boxes which have vents at each end. One of the vents at each end of the box is connected to a hold in the wall of the chamber with a suction. The speed of the air flow may bring down the temperature of the flowers to the air temperature in the cold room is less than an hour. The suction is switched off as soon as the temperature of carnation flowers is near 00C The humidity must be maintained at high level (90-95%). 7.2.6 Storage After pre-cooling, blooms must be kept under continuous refrigeration during distribution for maximum benefit. Pre-cooling has little or no value if low temperature are not maintained during subsequent periods. The optimal storage temperature for cut flowers may vary according to stage of flower development and method of storage. Carnations cut at bud stage are stored at 00C whereas open carnations are stored at 340 C in water. For export oriented units, storage is required because the refrigerated van may not be available for shipment immediately after pre-cooling. 7.2.7 Transport The quality of flowers can be damaged during transit from cold store to the airport. A refrigerated van for transport to the airport should, therefore, be used. Cold store at the Airports of Delhi, Bombay and

Bangalore are likely to be ready soon. In case of delay in the availability of air cargo space, the cold store facility at the exit points should be availed of. If buds of carnations are harvested at the ''cross'' stage, they can be transported by sea in refrigerated containers with proper preservatives. 8. Project Components In the light of technology outlined in the preceding paragraph, the project could comprise the following major components : 8.1 Land 3 acres for green house and other facilities. The land might have already been under cultivation. 8.2 Fencing Barbed wire (6 strands) fencing for 3 acre block, Perimeter 460m. Angle Iron (40 x 40 x 5mm) each 1.5 m length at the interval of 2 m. 8.3 Farm Road (internal) About 400 m long and 2 m wide dressed with broken bricks. 8.4 Greenhouse Plastic green house with gross size 1 ha. on the lines of technical specifications given under paragraph 7.1.3. 8.5 Carnation cutting and cultivation Technical aspects have been detailed under paragraph 7.1.6 to 7.1.10. 8.6 Irrigation System 1. 2. 3. 4. 5. 6. Tubewell - 3'' Motor - 3 H.P. Overhead Tank - 1000 litre capacity Pumphouse - 2m x 2m x 3m Drip System - vide paragraph 7.1.3 Pressure gauge water meter

8.7 Grading and Packing Shed 200 sq.m area raised pucca cemented floor with roof of corrugated G.I. sheet. Open on all sides. 8.8. Pre-cooling chamber 3.5 H.P. 1 tonne in 4 hours, with compressor, evaporator, condenser and blower. 8.9 Walk-in cold store Size 10' x 10' x 7'4'', H.P. 1.5, with compressor, evaporator and condenser.

8.10 Reefer Van 8.11 Fax machine, electric typewriter and telephone 8.12 Grading table and office furniture and farm equipments 8.13 Office and store - 100 sq.m area 9. Availability of Materials and Equipments All the material and equipments mentioned in preceding paragraphs are available in the domestic market, except planting material. Rooted cuttings of carnation varieties have to be imported every alternate year. Once imported though they can be propagated locally paying royalty, it might be better to continue import since existing varieties of cut flowers including carnation quickly loose popularity with the advent of new varieties. Moreover, breeding and propagation would require much higher level of technical expertise and investment than mere production. LDPE of good quality for roofing of the green house will be available from IPCL. This also will require replacement every alternate year. 10. Estimated Cost A. Fixed cost vide Annexure A B. Recurring cost vide Annexure B to D (for 1st year only) Total Capital Expenditure 11. Projected yield Since the grower-exporter is expected to adopt the latest technology of carnation growing, as outlined in the paragraph 7, projected yield of 240 stems/m2, with 80-90% exportable quality could be achieved (vide Annexure F) 12. Sale Price Based on the price trends of carnation cut flowers in various international markets and also discussions with an Indian exporter, a conservative sale price has been assumed at Rs.5.00/stem. 13. Financial Analysis For financial analysis, net annual income without the project has been assumed to be Rs.10,000/per ha. Result of the analysis is as under :Rs. 45.00 lakhs Rs. 23.70 lakhs Rs. 68.70 lakhs

NPW at 15% DF : Rs.48.44 lakhs BCR at 15% DF : 1.15 IRR (vide Annexure G) : 31 %

14. Finance The project on export of cut flowers would be considered for refinance support by NABARD. Therefore, all eligible scheduled banks may consider financing the activity. 15. Margin Money The farmer-exporters should normally meet 25% of the project cost out of their own resources. However, NABARD could consider providing margin money assistance in suitable cases as per the guidelines vide circular No.DPD.67/92-93 (Ref.No.3708/NFS-85/92-93) dated 27 Feb. 1993. 16. Interest Rate Interest rate will be as indicated by RBI/NABARD from time to time. The existing rate of interest at the ultimate beneficiary's level is 15% p.a. However, the repayment programme has been worked out at 17% interest to take care of interest tax and other charges etc. 17. Scale of Refinance In view of the priority attached to the export, NABARD is agreeable to provide refinance support to the

extent of 90% of the bank loan. 18. Security Banks may charge such security as permissible under RBI norms. 19. Repayment The loan will be repaid in six years with moratorium for the 1st year, vide Annexure-H. Annexure A FLORICULTURE FIXED ASSETS (In Rupees) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Fencing (Barbed Wire) Farm Road Green House (Poly house) (1 Ha) Irrigation Systems (Drip) Grading/Packing Shed Office and Store Pre-Cooling Unit Cold Storage Reefer Van Fax Machine Telephone Typewriter Furniture Equipment (Misc.) Contingency Total Annexure A-1 ESTIMATED COST OF FENCING & FARM ROAD I. FENCING: Area : Say 3 Acre Block Perimeter = 460 m. 23,000 10,000 1,400,000 391,000 200,000 300,000 400,000 400,000 900,000 30,000 10,000 15,000 30,000 30,000 4,139,000 361,000 4,500,000

Barbed wire @ Rs.1.25/m (16 gauge) 6 Strands For 460 m. For 460 m. Rs. 6 x 1.25/m =Rs.3450/=Rs.3500/-

Angle Iron (40 x 40 x 5mm.) Length 1.5 m. at interval of 2m i.e. Total length 230 x 1.5 m. =345 m. =350 m. (at 3 kg./m) =1050 kg. =1100 kg.@Rs.14.00/kg Total Cost Rs.15,400/=Rs.2760/-

3 4

R.C.C. Pole @ 12/pole for 230 poles Labour Rs.3/m i.e. Rs.1380 Grand Total, say Rs.23,000/-

II

ROAD Total Length Width Area Rate Cost 400 m. (approx.) 2 m. 800 sq.m. Rs.12/sq.m. : Rs.96,000/- say Rs.10,000/-

Annexure A-2 Summary of the Estimated cost of GREEN HOUSE / HA A. Green house structure 1 M S Angle (40 x40x5mm) 42tonnes 2 12 mm rods 400 tonnes 3 Labour cost @ 1300/tonne B. Greenhouse gutter 1 G.I. sheet 550 sq.m 2 Labour cost Rs.10/sq.m. C. RCC Pole (size 0.05 m3) 1 For 600 poles @ Rs.80/pole 2 12 mm rods 2.2 tonnes D. LDPE sheet 1 14650 sq. m. @ Rs.25/sq.m 2 Labour @ 20 mandays/unit 1000 mandays @ Rs.50/day (skilled labour) 1,292,300 E. Curtain wall Total Say = Rs.14.00 lakhs 75,000 1,367,300 366,000 50,000 48,000 31,000 88,000 5,500 Rupees 588,000 56,000 59,800

Annexure A-3 ESTIMATED COST OF DRIP IRRIGATION SYSTEM Sl. No. Cost Estimates per Bed 1 2 Main line, 30 mm, 2m width/bed Red Rs.15/m Lateral line, 10 mm, 4 lines each of 24m length bed 2 x 24 = 96 m, Rate Rs.3.00/m 3 4 5 6 7 Lateral connectors 4 nos @ Rs.6.00 End connectors 4 nos @ Rs.4.50 Micro tubes (2 litre/hr) 4 x 60 @ Rs.1.00 Tees, end plug Joint end plug etc. Total Total number of beds / ha. = 200 Total cost = 200 x 1600 = Rs. 3,20,000/Other Items 1 2 3 4 5 6 Filtration and Fertigation unit Pressure gauge water meter Overhead tank (1000 litres) Shallow Tubewell (2'') Pumpset (3 HP) Pump house Total Gross Total = Installation charges (5%) Contingency (3%) Rupees 5,000 1,000 6,000 9,000 5,000 5,000 31,000 Rs.3,51,000.00 17,550 10,530 379,080 Say 380,000 Annexure B CULTIVATION EXPENSES (Rs./ha) Sl.No. Particulars Ist Year 2nd Year 500.00 500.00 1600.00 24.00 18.00 240.00 Rupees 30.00 288.00

1 2 3

Land Preparation and Layout Soil Sterilisation Rs.15/m2 Bed Preparation 5 mandays/bed

2,000 108,000 25,000

----

200 beds. Rs.25/manday 4 5 Planting Material} Annexure B. Manures and Fertilizers (i)Manures (ii)Fertilizers Annexure B.2 6 7 8 Plant Protection Chemicals Electricity for Irrigation Labour 1800 mandays @ Rs.25.00/manday 2,046,500 Say Rs.20.50 lakh Annexure B-1 ESTIMATED COST OF PLANTING MATERIAL Quantity Required 1 2 3 4 5 Spacing Density Growing space Quantity of Planting material required Assuming 6.66% Morality Say 6 7 Price Total Cost Say Annexure B - 2 ESTIMATED COST OF AGRICULTURAL INPUTS A. Manures Farm Yard Manure @ 10 kg/m2 70 MT/ha @ Rs.100/MT = Rs.7000.00/ha B. 1 2 3 4 Fertilizers (Nutrients) Rate N P2O5 K2O Borax and other micro Nutrients (LS) 2,800 Rs.6/kg Rs.7/kg Rs.3/kg Quantity 700 kg/ha --do---do-Total Amount (Rs.) 4,200 4,900 2,100 11,200 20 x 15 cm 33/m2 7200 Sqm/ha 237,600 2,37,600 + 15,840 = 253,440.00 = 253,500.00 Rs.7.00/Rooted cutting Rs.25,000. 12.0% Rs.18.00 lakhs 111,500 Say Rs.1.15 lakh 7,000 14,000 45,000 500 45,000 7,000 14,000 45,000 500 45,000 1,800,000 --

Total Cost C. 1 2 3 Plant Protection Chemicals Dithane M Metasystox Karathane Rate 0.6 gm/litre @ Rs.100/kg 1.25 ml/litre @ Rs.120/litre 1.00 ml/litre @ Rs.300/litre Total Note : (i) Volume of Spray 1500 litre/ha (ii) No.of sprays 50/year D. Soil Sterilization By Chloropicrin @ Rs.15/m2 (custom application) E. Miscellaneous Chemical Annexure C POST HARVEST EXPENSES (Rs. in lakhs) Sl.No. Particulars 1 2 3 4 5 Preservatives and Chemicals @ Rs.0.25/Stem Packing Box - 600 Stem/Box @ Rs.100/box Transportation from Farm to Air Port (Rs.0.04/Stem) Air freight (Rs.0.75/Stem) Labour :Year 2 - 500 mandays Year 3 - 600 mandays 6 Cost of running Pre-cooling unit, (Annexure C-1) Cold Store and Refrigeration 7 Commission on Sale Agent (7%) and E.C.(18%) Total Annexure C - 1 ESTIMATED COST OF ELECTRICITY CONSUMPTION --17.27 34.6 -0.55 -0.12 1 yr. ----2 yr. 3.45 2.3 0.55 10.36 Rs.6,720.00 Rs.1,08,000.00 75 litre/ha 94 litres/ha Quantity 45 kg/ha

14,000 Amount (Rs.) 4,500 11,280 22,500 38,280

3-15 yrs. 3.89 2.59 0.62 11.66 0.15

0.62 19.44 38.97

1. Refrigeration unit in Van 7.5 HP x 0.75 kw x 200 x 24 hr (assuming 200 operational days & 1 HP = 0.75 kw) = 27,000 kw hr. = Rs.27,000/year (assuming electricity charges Rs.1/hr) 2. Pre-cooling Unit 2800 watt x 300 x 24 hr (300 operation days/year) = 20,160 kw.hr - Rs.20,160/year = Rs.20,200/year 3. Walk-in Cold Store 2000 watt x 300 x 24 hrs (300 operating days) = 14,000 kw.hr = Rs.14,400/year Total = Rs.61,600/year say Rs.62,000/year Annexure D OVERHEADS A. 1 2 Salary per year Manager - 1 Assistants - 2 (Production, Marketing & Office) 3 4 5 6 7 B. 1 2 Clerk-cum-Typist - 1 Guards - 3 Driver for Van Mechanic/Overseer Contingencies Sub total Office Overheads Stationery Postal 2,500 2,500 24,000 27,000 10,000 12,000 5,000 210,000 Rupees. 60,000 72,000

3 4 C. D.

Electricity Travels Sub total Insurance (from 1st year onwards) Repairs & Maintenance (2nd year and onwards)

3,000 2,000 10,000 100,000 100,000

Annexure E Recurring Expenses YEAR (Rs.in Lakhs) Annexure F PROJECTED PRODUCTION AND INCOME Sl.No. 1 2 3 4 Particulars No. of flowering stems per plant No. of flowering stems / m2 No. of flowering stems / ha (in lakhs) No. of export quality flowers (in lakhs) Year 2: 80% Year 3: 90% 5 Gross income (Rs. in lakhs) Assuming price Rs.5/Stem BCR = 379.83 / 331.39 = 1.15 NPW = Rs. 48.44 lakhs IRR = 30+5 (2.25/2.25(-4.69) = 30+5 (2.25 / 6.94) IRR = 30 + 1.62 = 31.62 % Annexure H REPAYMENT SCHEDULE (Rs. in lakhs) Year Net Bank o/s Interest Repayment Repayment Incremental at @ 17% of Interest of Princial Benefit beginning of the year -68.80 29.50 9.82 51.53 60.29 43.00 8.76 8.76 7.31 -17.52 7.31 -8.53 -Outsta nding at the end Surplus -69.10 77.75 1 yr. ----2 yr. 3-15 yrs. 8.00 240.00 17.28 13.82 8.00 240.00 17.28 15.55

1 2 3

60.29 43.00 43.00

Nil 3.00 2.51

4 5 6 Annexure I

33.33 9.82 33.33

43.00 22.00 19.00

7.31 3.74 3.23

7.31 3.74 3.23

21.00 3.00 19.00

22.00 19.00 Nil

5.02 3.08 11

European Community's Common QUALITY STANDARDS Extra Class Produce which qualifies for Class I without the aid of any tolerance. This excludes American Carnations with split calyx. Class-I Flowers must be of good quality, characteristics of the species variety. They must be whole, fresh, unbruised, free of animal or vegetables parasites and resultant damage, free of residues of pesticides and other extraneous matter affecting appearance and free of development defects. Tolerance permitted upto 7 per cent. Class-II Flowers which do not meet all requirements of Class-I but are whole, fresh, free of animal parasites. Slight defects such as malformation, brushing, damage, small marks, weaker and less rigid stems may be present provided they do not impair appearance. Tolerance permitted upto 10%. EC's standards are generally applicable to all cut flowers - no separate standard for different species of cut flowers have been established with the exception of mimosa. Whereas, the United Nation's Economic Commission for Europe has recommended general as well as specified standards for a number of flowers. The U.S.A. has no official standards for cut flowers. The society of America Florists has recommended standards for certain cut flowers which included carnations. The grades are known as Blue, Red and Green and are based on flower diameter and length of stem. The ECE of UN or EEC standards ignore length of stem and flower diameter in making class selections. Thus Extra Class may contain classified flowers with both long and short stems. Nonetheless flowers must be sorted out according to stem length as given below :Description Code 0 5 10 15 20 30 40 50 80 100 120 Minimum & Maximum Stem Length (in cm) Less than 5cm or flowers marked without stems 5-10 10-15 15-20 20-30 30-40 40-50 50-60 80-100 100-120 120