Announcement of India to Receive IDA Credit for Cooperative Societies on May 22, 1981

- FOR IMMEDIATE RELEASE a!VorldBank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.•Telephone: (202) 477-1234 IDA PRESS RELEASE NO. 81/86 Mc1 y 2 2 , 198 1 INDIA TO RECEIVE IDA CREDIT FOR COOPERATIVE SOCIETIES The International Development Association (IDA) announced today the approval of a credit of SDR 101.8 mill ion ($125 mill ion) to India to provide credit to coopera- tive societ·ies for the construction of godowns (storage and office facilities) and cold storage units in nine Indian States. IDA is the World Bank's affiliate for conces- sionary lending~ The $267 million project, to be implemented over a five-year period by the National Cooperative Development Corporation, will provide cooperative godowns and cold storage buildings in the States of West Bengal, Bihar,Madhya Pradesh, Andhra Pradesh, Maharashtra, Uttar Pradesh, Haryana, Punjab, and Himachal Pradesh. The 7,900 godowns to be built under the project will be used for purchasing, storing, and receiving farm inputs, mainly fertilizers, as well as seeds, pesticides, non-perishable farm produce, and other commodities. They will also serve as rural service centers, dispensing farmer credit and consumer goods such as soap and kerosene, nd wil 1 be focal points for village economic activities. A total of 127 cold storage • nits will help improve storage methods, as well as the efficiency of marketing practices for potatoes and oth~r semi-perishable foods, by enabling farmers to market their produce at a commercially advantageous time of year. Under the project, technical assistance wil 1 be provided to strengthen the loan evaluation and organization and manageme~t departments of participating banks, and marketing units of cooperative federations, and for training in godown and cold store operations. Research and development activities are also included to determine the most suitable storage facilities and marketing methods, not only for potatoes, but also for other semi-perishable commodit.ies such as onions and pulses. About 3.2 mill ion farm families are expected to benefit from the timely deli- very of fertilizers and farm inputs, and from the use of facilities for collection and marketing of their produce, made possible by the godown construction. The cold storage faci 1 ities wi 11 benefit about 150,000 families by reducing waste and spoilage of potatoes, and by increasing the value of the crop through deferred marketing. Over 65% of project beneficiaries are landless, marginal, or small farmers with less than five hectarei of land. The project wil 1 also generate about 62,500 man-years of employment in the rural sector. The IDA credit is for 50 years, including 10 years of grace, and is interest- free, except for a service charge of 3/4 of 1% per annum to cover IDA's administrative costs. The credit will be committed when funds are available. ~OTE: !DA cr~dits are denominated in SDRs (Special Drawing Rights), which are valued on the basis of a 11 basket 11 of currencies. The U.S. dollar equivalent of the SOR amount of the IDA credit reflects the exchange rate existing at the time of negotiation of the credit. FORM NO. 1121 (5-76) T ECHNI CAL DAT A • PROJECT: Second National Cooperative Development Corporation COUNTRY: india TOTAL COST: $267 million IDA FINANCING: SOR 101.8 million ($125 million), standard IDA terms OTHER FINANCING: National Cooperative Development Corporation, $75.2 million State Governments, $53.4 million Beneficiary cooperatives, $13.4 mill ion IMPLEMENTING ORGANIZATION: National Cooperative Development Corpora ;on 4 Siri Institutional Area Hauz Khas New De 1h i 11 0 0 16 , I n d i a PROJECT DESCRIPTION: The project wil 1 provide credit for cooperative godowns {storage and office facilities) and cold storage and marketing facilities to assist in meeting the input supply and post-harvest requirements in nine States (West Bengal, Bihar, Madhya Pradesh, Andhra Pradesh, Maharashtra, Uttar Pradesh, Haryana, Punjab, and Himachal Pradesh), to promote the development of the cooperative institutions within these states, and to expand the capabi 1 ity for sub-project preparation and appraisal with~ the cooperative sector. The project will finance the construction of about 7,900 cooper~ tive godowns and 127 cold storage units. Also included are: technical assistance, training in cooperative marketing techniques and cold storage operations, and research and develop- ment on experimental cold-storage facilities and related activities. PROCUREMENT: Contracts for godowns and cold stores wi 11 be awarded under local competitive bidding procedures in accordance with IDA guide] ines. CONSULTANTS: About 264 man-months of consultant services will be required under the project for: technical assistance to participating banks; development of procedural and operational manuals for godowns and cold stores; and training for cold-store operational staff and for research and development activities. Or • ECONOMIC RATE RETURN: 23% ESTIMATED COMPLETION DATE: 1986 - 0 -