26.12.25

Sona Buru Jungle Producer Company Initiates Royalty Payments to Gram Sabhas in Jharkhand

On 20 December 2025, the women-led Sona Buru Jungle Producer Company (SBJPC) distributed royalty payments to Gram Sabhas in Simdega district, Jharkhand. The programme was held at the residence of Shri Naman Bixal Kongari, Hon’ble Member of the Legislative Assembly (MLA) from the Kolebira Assembly Constituency, in the presence of SBJPC’s Board of Directors, media representatives, and block- and district-level officials. This marked the first time in Jharkhand that a producer company (PC) had made royalty payments to Gram Sabhas.

Royalty in Community Forest Governance

Royalty is a portion of the income from the sale of seasonal forest products (SFPs) that is paid to Gram Sabhas in recognition of their rights over community forest resources under the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 (in short, the Forest Rights Act (FRA)). Royalty ensures that Gram Sabhas are recognised not only as rights-holders but also as beneficiaries of the value created when SFPs are sold in the market.

Authorisation, Sale, and Royalty Distribution

Before starting aggregation, SBJPC obtained formal authorisation from the Community Forest Resource Management Committees (CFRMCs) constituted by the Gram Sabhas under the FRA. As part of this authorisation, the Gram Sabhas required SBJPC to pay a royalty equal to 2 per cent of the sale value of all SFPs sourced from their villages.

In 2025, SBJPC aggregated 44.47 tonnes of sal (Shorea robusta) seeds from multiple villages and sold them for ₹14.4 lakh to AAK India Private Limited, marking its first formal commercial sale. Based on this sale, a total royalty of ₹4,635 became payable to 23 Gram Sabhas. Although this amount is modest, it demonstrates a working system through which Gram Sabhas can begin to receive a share of the value generated from SFP trade. As volumes and prices increase in future years, the same system can generate more meaningful and regular returns.

Royalty payments were transferred to the bank accounts of 12 Gram Sabhas. For the remaining seven Gram Sabhas, cheques were handed over symbolically because their bank accounts are still being activated at the State Bank of India, Bano Branch. The remaining payments will be transferred once these accounts become operational.

Institutional Separation between Gram Sabhas and PCs

This royalty arrangement demonstrates how governance and commercial functions can be institutionally separated within a rights-based forest economy. Gram Sabhas, through their CFRMCs, exercise authority over community forest resources by granting permissions and setting conditions for harvesting, including royalty rates. The PC manages aggregation, sales, and market engagement, thereby keeping forest governance separate from market risk.

Way Forward

As SBJPC expands into the aggregation and sale of additional SFPs, this first royalty payment shows how community forest governance and enterprise-based livelihoods can be linked in a transparent, lawful, and scalable way in Jharkhand.