Announcement of IDA Approves Fifty-Four Million Dollars to help India Develop Silk Industry on June 5, 1980

.··FOR IMMEDIAT~ RE~E~SE · World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. • Telephone: (202) 393-6360 IDA NEWS RELEASE NO. 80/87 June 5, 1980 IDA APPROVES $54 MILLION TO HELP INDIA DEVELOP SILK INDUSTRY India will be receiving $54 million from the International Development Association (IDA), the World Bank affiliate for concessionary lending, to help develop its sericulture industry in Karnataka State. India ranks fifth among silk producing countries. The Karnataka Seri- culture Project, to be implemented by the State's Department of Sericulture, will help increase the raw silk production in Karnataka by about 1,600 tons per year. The project also seeks to increase the production of high quality bivoltine silk from 100 tons to 1,000 tons per year. Silk reeling capacity will also be expanded and modern equipment will be introduced to produce export quality raw and spun silk . • Local farmers will be encouraged to replace 20,000 hectares of local mulberry varieties, the leaves of which are food for the silkworms, in tradi- tional production areas with improved MS varieties, plant 16,000 ha of mulberry in new areas and generally improve mulberry cultivation in all parts of the state. The project, with a total cost of $95.1 million, will also provide funds for construction of buildings, increased staffing, and purchase of equip- ment such as motor vehicles for the State Department of Sericulture and for participating research institutes. Provisions have also been made to bring consultants to Karnataka, to help improve research, advisory services and silk processing and develop grainage facilities. A grainage is where the eggs of selected silkworm varieties are pro- duced under controlled hygienic conditions for sale. The research component.will be carried out by the Central Sericultural Research and Training institute, three universities, and the Karnataka State Silk Development Institute. It is expected that the project will benefit all the estimated two mill ion persons engaged in sericulture and related activities in Karnataka. A number of Job opportunities will be created (about 180,000 work-years annually), primarily. among the rural population, and the incomes of producers and processors w i 11 imp rove as we 11 • • The IDA credit is for 50 years, including 10 years of grace. It will carry no interest but will bear a service charge of 3/4 of 1% per annum to cover administrative expenses. NOTE: Money figures are expressed in U.S. dollar equivalents.  FORM NO. 1121 (5-76) T E C HN I CA L DAT A PROJECT: COUNTRY: TOTAL COST: Karnataka Sericulture India $95.1 million • IDA FINANCING: $54 million, standard IDA terms OTHER FINANCING: Government of India and Karnataka, Agricultural I Refinance and Development Corporation, Industrial Development Bank of India, and participating farmers. IMPLEMENTING ORGANIZATIONS: The Karnataka Depa~tment of Sericulture, the Karnataka Silk Industries Corporation, and Central Silk Research and Training Institute Department of Sericulture and Karnataka Silk Industries Corporation Multistoreyed Buildings Vidhana Veedhi Bangalore Karnataka, India. Central Sericulture Research and Training Institute • Manandavadi Road, Sri Rampura Mysore 570 008 Karnataka, India. PROJECT DESCRIPTION: This integrated development project for agriculture in- cludes: (a) increasing rai,; sflk production in Karnataka by about 1,600 tons per year as well as production of high quality bivoltine·silk from JOO tons to 1,000 tons per year by strengthening sericultu,,·e advisory, silk worm egg production and cocoon marketing services and providing on-farm credit; (b) expansion of reeling capacity and introduction of modern equipment to produce export quality raw and spun silk; (c) introduction of the latest technologies from leading silk producing countries, especially Japan, and expansion of local research to improve the silk industry in the long-term. · PROCUREMENT: Reeling and spinning machinery major items of ancillary equipment such as boilers will be bought through interna- tional competitive bidding following IDA guidelines. Other requirements such as civil works for the research program, motor vehicles and other equipment will be procured after local competitive bidding. CONSULTANTS: About 70 man-months of consultant services would be needed to help develop the research program, expand the grainage and communal hatcheries programs including training for local personnel, and assist with • modernization of reeling and spun silk manufacture. ECONOMIC RATE OF RETURN: 22% ESTIMATED COMPLETION DATE: 1983 - 0 -