ARAKU VALLEY, India -- It is almost 8 a.m. and the dense fog clinging to the Eastern Ghats seems unwilling to let go. But the sun perseveres as Apparao Pangi and Boi Simhadri trek to their farmlands in Araku Valley, at an elevation of more than 1,000 meters, in the southern Indian state of Andhra Pradesh.

The men follow a path that snakes through open cattle-grazing patches, bushes and loose soil over rocky terrain. The path narrows as they ascend the hill. Finally, they climb an embankment of waist-high rocks. A mix of foliage stretches out on the other side of the hill: mulberry, sweet lime, custard apple, sapota, banana and tall silver oaks that host pepper vines. Growing under this canopy are coffee bushes about a meter-and-a-half high.

The Eastern Ghats are a range of mountains extending to five Indian states. The land, though difficult to access, is extremely fertile. It is also home to more than 50 indigenous tribes. Almost no government aid reaches these remote locations due to the presence of Naxalites, an insurgent Maoist group that believes the government exploits tribal peoples and their land under the guise of development.

Pangi, 55, and Simhadri, 33, both of the Kondadora tribe, are just two of the many farmers and their families who have witnessed the unrest here, including gunfire between police and the outlawed Naxals. Against this unpromising backdrop, their lives have taken a dramatic turn in the last decade. From earning barely 100 rupees (about $1.60) a day, they now own coffee plantations.

"You see that plot over there, with the big mango tree?" said Simhadri, pointing ahead. "That's mine." In the half-hectare that Simhadri owns, coffee bushes thrive all around the tree.

Coffee cultivation in Andhra Pradesh has been around since the late 1800s, and is said by local farmers to have been brought to the state by a British coffee grower.

Coffee beans are packed and graded according to quality and flavor at the Naandi Foundation's warehouse in Araku, India. (Photo by Avanish Tiwary)

While most coffee growers in the state previously sold their produce to local traders, Simhadri and the 25,000 tribal farmers of Araku Valley sell their coffee in 17 countries, including to a cafe in Paris, branded as Araku Originals.

The operation is backed by the Naandi Foundation, a charitable trust that buys coffee cherries from the farmers, then processes and sells the coffee to wholesale buyers in Japan, the U.S, Ireland and elsewhere.

The foundation was started in 1998 by Andhra Pradesh Chief Minister N. Chandrababu Naidu; K. Anji Reddy, founder of pharmaceutical company Dr. Reddy's Laboratories; and Anand Mahindra, chairman of the Mahindra Group conglomerate.

Social enterprise

When Manoj Kumar, chief executive of the foundation, sought ideas for a social enterprise in 2000, his friends directed him to Araku Valley.

"I spent considerable time there and noticed that, except [for] one arterial road, the whole region was cut-off from civilization," Kumar said. "As Naxal activity was at its height then, no government or developmental work reached the valley."

Naandi put together a maternal healthcare program and constructed single-room schools out of bamboo. When basic healthcare was covered, people asked Kumar to help them grow coffee.

The few farmers who had previously attempted to grow coffee either failed or could not produce quality crops, forcing them to accept the low bids middlemen offered. Although the state had given coffee saplings to farmers, they were never taught the subtleties of cultivating the crop.

"Before expecting them to grow something, we had to understand the tribal ways and culture," Kumar said. "They were the people of the forest who ate whatever they found in the woods. To make them into coffee estate-owners had to be a huge transformation. It's like telling a poor person whose priority is livelihood to become an entrepreneur."

To help farmers with their basic needs, Naandi paid them wages. Kumar sought to raise funding from big companies and drew in Rajendra Prasad Maganti, chairman of infrastructure company Soma Enterprise, and Kris Gopalakrishnan, co-founder of information technology company Infosys.

Around 2004, when Kumar started to look for better ways of growing coffee, he met David Hogg, an agriculture expert from New Zealand who was then working at a farm in Tamil Nadu, a state that borders Andhra Pradesh. In Hogg's opinion, the rocky farmlands in Araku were semi-wasteland.

"David told us we needed to bring back carbon in the soil and train farmers in bio-dynamic farming practices," Kumar said. "This method advocates studying planetary positions to find out the best time for sowing and harvesting." Almost organically, he said, Naandi found natural resource management techniques to convert these semi-wastelands into coffee plantations.

Three years into teaching farmers to grow quality coffee and implement better farm practices, coffee yield increased 20% to 25%. But even with increases in yield, their income did not rise proportionally. "Dependence on the commodity price index [fixed by the government] and the presence of middlemen ensured farmers never got the right price," said Anupama Sreeramaneni, general manager at Naandi.

Middlemen paid farmers only 60 to 100 rupees per kilogram. She said the cost of production for Naandi is 320 rupees per kilogram. The commodity price index fixed the selling price at 140 rupees per kilogram.

Striking gold

That is where Araku Originals came in. "The goal was to help farmers earn income proportionate to their effort and yield by exclusively marketing coffee grown by Araku's farmers," Sreeramaneni said.

By then a few coffee aficionados were saying that Araku's coffee had an extraordinary profile -- tapping into the right market would fetch good money. "People told us we had struck gold," Kumar said.

In search of a better-paying market, Kumar connected with high-end coffee buyers and roasters worldwide and invited them to try Araku's coffee. He got in touch with Hidetaka Hayashi, credited with introducing specialty coffee to Japan, and Yuko Itoi, a long-time specialty coffee jury member with Cup of Excellence, an annual event to identify top-quality coffee.

Every year since 2009, Naandi has organized "Gems of Araku," where buyers from around the world come to taste the coffee. The six coffee variants that Araku Originals sells start at 3,000 rupees per kilogram.

"Araku coffee mostly has good flavor and sweetness, which is due to their organic compost and good care of the farm," said Itoi, a coffee buyer from Tokyo who buys around 3,000kg of Araku coffee a year. "Through my almost 10 years of relationship and visits to Araku, I can say that the quality of their coffee is getting better every year."

Last year, Araku Originals launched its first shop in Paris, where the price ranges from 4,000 to 6,000 rupees per kilogram. "We wanted to create a brand for Araku so that we could leave behind a legacy for Araku's tribal population," Kumar said.

Once the Paris store becomes profitable, Kumar estimates it will take another four years for Araku Originals to start earning a profit globally. Over the next year, Kumar plans to open a similar cafe in either Tokyo or New York.

Kumar said that over the two decades, the valley has been transformed. "People who were foraging in the jungle are now saving money to either buy gold or to send their children for higher studies. Many have more than one concrete house, others now own two-wheelers."