As habitats have become fragmented they have lost their biodiversity, resulting in a 40 percent average drop in species abundance each year since 1970. This directly affects the functioning of essential ecosystem services. It is difficult to estimate the loss of value this causes, but the economic contribution of these services is estimated to be at least $16 trillion per year.
Products derived from local plant and animal species generate $10 billion annually in international trade. Together with the current pressures on biodiversity, this means that the sustainable management of these resources will be critical to the future viability of such markets. Two companies in WRI’s New Ventures portfolio have recognized this market opportunity and are positioning themselves to meet the challenge in India and Brazil.
Gram Mooligai
Sustainably meeting rural India’s healthcare needs
As an off-shoot of a successful NGO, Gram Mooligai originally entered the private-sector to expand production of locally harvested medicinal plants, accomplishing the dual goals of achieving financial sustainability and scaling up efforts to preserve those native species. The company is owned by a network of rural growers that manufacture a variety of herbal remedies including Trigul balm for joint pain and Jwaracin, a fever reducer.
Gram Mooligai leverages India’s strong heritage of traditional healing methods, and sources products from its rich biodiversity. Herbs are harvested by local producers who must adhere to a strict monitoring process which ensures the use of sustainable crop management techniques.
The final products are primarily sold to the previously untapped market for healthcare services in the Indian countryside. While individual households in these regions may not have strong purchasing power (the average household spends $50 a year on primary healthcare), companies that can access entire communities find a significant source of revenue.
Gram Mooligai has made this high volume, low cost strategy an intrinsic part of its business model. By leveraging partnerships with 100 NGOs, and a network of 300 women health practitioners, Gram Mooligai casts a wide net, offering their products to over 30,000 households. With its success in rural areas, the company has begun selling its products to underserved groups in Bangalore and plans to expand its offerings in urban areas.
Linax
Bringing sustainability to the cosmetics industry
Brazil is home to approximately 20 percent of the planet’s biodiversity, but exploitation of the country’s natural resources has come at a price to its bountiful variety of wildlife. Recognizing the value of plant-based products such as linalol, and safroland eugenol–along with the devastating impact of biodiversity loss–entrepreneurs Nilson Borlina Maia and Jos
