INTEGRATED SAFEGUARDS DATASHEET
APPRAISAL STAGE
I. Basic Information
Date prepared/updated: 07/29/2011 / Report No.: AC62311. Basic Project Data
Country: India / Project ID: P107648
Project Name: National Dairy Support Project
Task Team Leader: Deepak Ahluwalia
Estimated Appraisal Date: July 26, 2011 / Estimated Board Date: September 15, 2011
Managing Unit: SASDA / Lending Instrument: Specific Investment Loan
Sector: Animal production (60%);Agricultural extension and research (20%);Agro-industry, marketing, and trade (20%)
Theme: Rural services and infrastructure (80%);Rural policies and institutions (20%)
IBRD Amount (US$m.): 0.00
IDA Amount (US$m.): 352.00
GEF Amount (US$m.): 0.00
PCF Amount (US$m.): 0.00
Other financing amounts by source:
BORROWER/RECIPIENT 39.10
Local Communities 62.80
101.90
Environmental Category: B - Partial Assessment
Repeater []
Is this project processed under OP 8.50 (Emergency Recovery) or OP 8.00 (Rapid Response to Crises and Emergencies) / Yes [ ] / No [X]
2. Project Objectives
1.The Project Development Objectives are to increase the productivity of milk animals and improve market access of milk producers in project areas.
2. These objectives would be pursued through: (a) adoption of scientific and systematic processes in provision of technical inputs and services to milk producers, with appropriate policy and regulatory measures; and (b) facilitating access of milk producers to the organized milk processing sector.
3. Project Description
1. The key principles underlying project design are:
A dairy farmer-centric approach.
Improving quality of inputs and services delivered to farmers through adoption of common protocols and Standard Operating Procedures (SOP) in provision of technical inputs and other services at the farmer#s doorstep.
Enhancing market access for sale of surplus milk by milk producers -- through village level institutional structures operating in a fair and transparent manner.
An enabling policy environment to support implementation of project investments.
2. The project will seek to increase milk production by genetic improvement of the dairy herd (cows and buffalos) and optimal use of feed and fodder. This would be achieved through investments in animal breeding, extensive training of dairy farmers and doorstep delivery of ration balancing advisory services and AI services, integrated with veterinary support, together with development of related information network and databases. The project will raise farmers# awareness about the importance of good quality milk and build their capacity for hygienic milk production, collection and sale. Collective sale will strengthen farmers# negotiating power and reduce transactions costs for such a highly perishable commodity.
3. There is a strong case for public intervention in technology transfer activities to improve the quality of the dairy herd and increase productivity. Investments in animal breed improvement are typically long term in nature with benefits accruing after several years. Since farmers are free to sell their milk to anyone, there is little private sector appetite for investing in herd improvement and village level collection and bulking centers, except for a few large private dairies pursuing long term commitments.
4. The project intends to support the following three components.
5. Component A: Productivity Enhancement (Estimated Cost US$ 258.3 million). This component will aim to increase bovine productivity through improved animal breeding and nutrition services. To achieve this aim the project intends to support the following activities:
Sub-Component # 1 Animal Breed Improvement: This sub-component will support:
a) Production of high genetic merit bulls (HGM) through: (i) Progeny Testing (PT) program in selected breeds; (ii) Indigenous Breed Development (IBD) program in selected breeds; and (iii) Import of exotic bulls/embryos/frozen semen.
b) Semen Production: Strengthening of existing semen production stations and establishment of new semen stations.
c) Delivery of Artificial Insemination (AI) Services through trained mobile AI technicians (MAIT) at farmers# doorstep.
Sub-Component 2 Animal Nutrition: This sub-component will support:
a) Ration Balancing Program (RBP): A comprehensive RBP whereby extension advice would be provided to dairy farmers through trained local resource persons (LRP) for advising on animal feed and nutrition. Research shows that feeding balanced rations has the potential to increase milk yield, reduce production costs, and contribute to reduced methane emissions.
b) Fodder Development: Extension initiatives/interventions for fodder development, including support for improved fodder seed production, fodder contracting, demonstrations for silage making, and reducing wastage of dry fodder through processing and enrichment.
6. The main expected results from interventions proposed under Component A are increased productivity per milk animal, increase in in-milk animals, improved conception rates, improved animal nutrition, and reduction in feeding costs per animal.
7. Component B: Milk Collection and Bulking (Estimated Cost US$ 166.3 million). This component aims to improve access to markets by milk producers, through investing in village level milk collection and bulking facilities. These investments are expected to strengthen negotiating power of small dairy holders and enable collective milk marketing to existing (and future) milk processing facilities. This will include:
a) community mobilization and institution building through: (i) expansion of selected existing dairy cooperative societies (DCS) registered under the Cooperative Societies Act, and (ii) promotion of new milk producer institutions which would be registered as producer companies under the Companies Act;
b) training and capacity building of milk producers and other functionaries; and
c) investments in village level infrastructure for milk collection and bulking such as milk cans, bulk milk coolers for a cluster of villages, associated weighing and testing equipment, and related IT equipment.
8. The main expected results from interventions proposed under Component B are increase in number of milk producers organized into dairy cooperative societies/producer companies, increase in coverage of villages for milk collection and bulking, increase in share of milk sold to the organized milk processing sector, and improved milk quality.
9. Component C: Project Management and Learning (Estimated Cost US$ 29.3 million). The aim of this component is to ensure smooth implementation and coordination of project activities, regular and timely monitoring of implementation progress and outputs/outcomes achieved, and learning through feedback to management. Activities to be financed include: (i) support for Project Management Unit (PMU) at NDDB; (ii) operation and management of computerized information systems for collection of data and dissemination of information related to animal breeding, nutrition, health services and milk collection and bulking; (iii) services of external agencies for carrying out baseline, mid-term and project completion surveys and other special surveys/studies as may be needed during project implementation; (iv) third party quality assurance of civil works under the project; and (v) technical assistance and support during implementation.
4. Project Location and salient physical characteristics relevant to the safeguard analysis
The project aims to cover 14 major dairying states over a six year implementation period. These states account for 93% of the country#s milk production and about 87% of the breedable cattle and buffalo population. The 14 states are Andhra Pradesh, Bihar, Gujarat, Haryana, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Orissa, Punjab, Rajasthan, Tamil Nadu, Uttar Pradesh and West Bengal. Participating states will have to apply the ESMF for this project.
5. Environmental and Social Safeguards Specialists
Mr Mohammed Hasan (SASDS)
Mr Anupam Joshi (SASDI)
6. Safeguard Policies Triggered / Yes / No /Environmental Assessment (OP/BP 4.01) / X
Natural Habitats (OP/BP 4.04) / X
Forests (OP/BP 4.36) / X
Pest Management (OP 4.09) / X
Physical Cultural Resources (OP/BP 4.11) / X
Indigenous Peoples (OP/BP 4.10) / X
Involuntary Resettlement (OP/BP 4.12) / X
Safety of Dams (OP/BP 4.37) / X
Projects on International Waterways (OP/BP 7.50) / X
Projects in Disputed Areas (OP/BP 7.60) / X
II. Key Safeguard Policy Issues and Their Management
A. Summary of Key Safeguard Issues
1. Describe any safeguard issues and impacts associated with the proposed project. Identify and describe any potential large scale, significant and/or irreversible impacts:
The project is aimed at enhancing milk productivity and access to milk market. Though the project would benefit overwhelmingly small dairy units and adverse impacts are likely to be minimal at the household level, the cumulative impacts due to the spatial spread and current practices could result in increased pressure on available common natural resources for grazing, increased GHG emissions from the livestock and improper waste management at the dairy farm level. Due to poor awareness and lack of leadership, there is a possibility of elite capture in dairy cooperatives and producer companies. However, the project offers opportunities in enhancing the social outcome of the interventions (through cooperatives including producer companies) and in improving its environmental footprint, including mitigating climate change, through adoption of better technologies and sustainable package of practices.
The key environmental challenges that the project addresses are: (i) reducing GHG emissions from livestock through a Ration Balancing Program; (ii) bridge the fodder gap through promotion of quality fodder seeds that would increase per unit tonnage of fodder; and (iii) on farm waste management by promoting a package of practice approach that accounts for better utilization of wastes generated.
On social aspects, the project ensures that: (i) dairy farmers (through cooperatives) have an important and active role in project interventions; (ii) small dairy farmers will have greater opportunities to participate in project activities; and (iii) any adverse impact resulting from the project interventions will be mitigated appropriately.
Most of the identified environmental and social issues and their mitigation have been mainstreamed in the project design. This approach would reverse some of the potential impacts. It is anticipated that the project activities would also result in positive environmental and social impacts, which have been identified and measures included in the ESMF to enhance them.
The Strategic Environmental and Social Assessment (SESA) has been completed and disclosed publically, which identifies the type and extent of environmental and social impacts including related to Pest Management (OP 4.09), waste management, GHG emissions, Tribal (OP 4.10), women and other vulnerable groups. The SESA also gives a screening matrix for categorizing sub projects on the basis on potential negative impacts. It includes a detailed Environmental and Social Management Framework (ESMF) prepared on the basis of impacts identified by SESA and includes a Pest Management Plan and a strategy for Tribal Development. ESMF provides a detailed mitigation strategy for limiting adverse environmental impacts, but also guidance to increase environmental sustainability of dairying as well for transparent consultations and disclosure at the sub project level. The ESMF also provides for a Grievance Redress Mechanism.
2. Describe any potential indirect and/or long term impacts due to anticipated future activities in the project area:
Dairy operations in India are largely restricted to small farmers with fewer animals and the project focuses on ration balancing in the short term and improving the genetic potential of dairy cattle in the long term. The project is unlikely to introduce any new impacts or intensify the existing impacts, mainly, pressure on natural resources, contributing to climate change and on farm waste management. On the contrary, despite small operations, poor awareness, and reduction in common property resources (land/pasture/water), there are opportunities in improving its environmental footprint, including mitigating climate change, through adoption of better technologies and sustainable package of practices.
Since no major infrastructure development is planned, the proposed project interventions are unlikely to adversely impact local population. The project would not support investments that require any land appropriation and thereby any displacement, both physical and economic. Since the majority of the project beneficiaries belong to small farmers, it would ensure inclusion of women, tribal and other vulnerable groups through active involvement in dairy cooperatives and improved membership in producer companies and thus provide #voice# in decision making process. This would restrict elite capture.
3. Describe any project alternatives (if relevant) considered to help avoid or minimize adverse impacts.
The following alternative approaches of providing balanced nutrition through the Ration Balancing Program targeting individual milch animal were considered but rejected: (i) feeding of only available crop residues as bulk fodder; and (ii) the regular practice of open grazing. These were rejected to mitigate both increasing pressures on natural resources and reducing livestock based methane production.
4. Describe measures taken by the borrower to address safeguard policy issues. Provide an assessment of borrower capacity to plan and implement the measures described.
As part of project preparation, an experienced and independent consulting agency was contracted by NDDB to undertake SESA for identifying the project#s potential negative and positive environmental impacts (both direct and indirect) and develop measures to prevent, minimize, mitigate and compensate for adverse impacts and enhance the positive impacts. Based on the results of the assessment and findings of SESA, an ESMF has been developed to address adverse impacts resulting from the proposed project interventions and improve the environmental and social performance of the project.
The capacity of the implementing agencies # both at the project (NDDB) and subproject levels - to address environmental and social issues is currently weak. To improve the capacity an Environment and Social Management (ESM) Cell would be established within the Project Management Unit (PMU). The cell will include a social development expert and an environment management expert to monitor ESMF implementation. An Environment & Social (E&S) officer would also be appointed / deputed at each of the End-Implementing Agencies (EIAs). Adequate provisions for orientation, sensitizing, and training the relevant stakeholders, including beneficiaries, implementing officers etc. on environmental and social concerns have been budgeted as part of project costs. This will be closely supervised during implementation. The project would have both internal and external monitoring mechanisms # internal monitoring would be done both at the PMU and subproject levels. Besides an external M&E agency that will be engaged at the project level will also periodically monitor and evaluate the social and environmental measures and their outcomes.
5. Identify the key stakeholders and describe the mechanisms for consultation and disclosure on safeguard policies, with an emphasis on potentially affected people.
As part of SESA, wide ranging stakeholders# consultations were undertaken. The project stakeholders include dairy farmers, members of dairy cooperatives, tribal and women and other vulnerable groups, NGOs, representatives of Panchayat Raj Institutions (PRIs), functionaries of dairy cooperative unions and NDDB, staff of relevant line departments and others. These consultations were held at individual, household and village/community levels in the field and also with local bodies (PRIs) and dairy institutions. In these consultations, the stakeholders were informed about project components and activities proposed to increase milk production, enhance access to market through bulk marketing and institutional strengthening of dairy institutions. The discussions focused on potential social and environmental impacts, and feasible management measures including improving the project design. The feedback from these consultations was used in developing an ESMF.