Bhutan : Hazelnut Value Chain Development Project

Nonsovereign Project | 49039-001

Project Details

  • Project Officer
    Singh, Samarendra
    Private Sector Operations Department
    Request for information
  • Country/Economy
  • Modality
  • Sector
    • Agriculture, natural resources and rural development
Project Name Hazelnut Value Chain Development Project
Project Number 49039-001
Borrower / Company Mountain Hazelnuts Group Limited
Country / Economy Bhutan
Type or Modality of Assistance
7449 Equity Ordinary capital resources USD 3.00 million Committed
Strategic Agendas Inclusive economic growth
Drivers of Change Private sector development
Sector / Subsector

Agriculture, natural resources and rural development / Agro-industry, marketing, and trade

Gender Effective gender mainstreaming
Responsible ADB Department Private Sector Operations Department
Responsible ADB Division Portfolio Management Division, PSOD
Responsible ADB Officer Singh, Samarendra
Project Sponsor(s) Mountain Hazelnut Venture Private Limited
Objectives and Scope

(i) The project will help boost Bhutan''s agriculture GDP and exports.

(ii) The project will promote private sector agribusiness development, in line with Bhutan''s Eleventh Five Year Plans objectives.

(iii) The project will contribute to poverty reduction in Dzongkhags with poverty levels above the national average, in line with Bhutan''s Eleventh Five Year Plan's target.

Status of Operation/Construction Pollen shortage is still the most significant issue that the company faces which has negatively impacted MH and to mitigate pollen shortfall, MH is using suckers' from existing trees to get more pollinizer trees. MH has also been emphasizing to the farmers additional plant care and nutrition to ensure that hazelnut plants grow faster and catch up with production trees.
Linkage to Country/Regional Strategy

The project is aligned with the Midterm Review of Strategy 2020, which emphasizes the need for ADB to support food security, agricultural productivity, and inclusive business such as agribusiness development that connects farmers to local and global food markets. The project is also consistent with the three strategic pillars of the Bhutan Country Partnership Strategy 20142018: inclusive economic growth, environmentally sustainable growth, and regional cooperation and integration.

The project is fully aligned with ADBs Operational Plan for Agriculture and Natural Resources (2015-2020), which recommends greater agribusiness investment by ADBs private sector operations department, and in particular direct equity investments in agribusiness companies which have long term financial viability prospects and have the potential for scalable impact. The project will also complement ADB's assistance to the Government of Bhutan for rural roads and water management.

Safeguard Categories
Environment B
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects No significant environmental disturbances are anticipated from hazelnut cultivation and processing as the screening criteria for site selection will avoid areas in the vicinity of environmentally sensitive areas. MH will help farmers plant and grow hazelnut trees exclusively on degraded or fallow land and no forestland will be encroached. MH has a monitoring system based on Geographical Information System and Global Positioning System to ensure that there are no adverse impacts on biodiversity and agricultural lands. MH takes all possible measures to comply with local and international environmental regulations.
Involuntary Resettlement No impact on involuntary resettlement as hazelnut trees will be developed by contract farmers on their own lands, and on a voluntary basis. MH''s land selection criteria for contract farming stipulates selection of lands that are (i) degraded or fallow and (ii) not used for agriculture or orchard purposes. No transfer of land ownership or rights is envisaged. Other facilities, such as the nursery and the processing facility, will be sited on leased lands or lands purchased from private land owners through negotiated settlement.
Indigenous Peoples No impact on Indigenous Peoples and MH''s operations are not expected to have impacts on identity, culture, and natural resource based livelihoods.
Stakeholder Communication, Participation, and Consultation
Timetable for assistance design, processing and implementation
Concept Clearance 16 Feb 2015
Credit Committee Meeting 01 Jun 2015
Approval 11 Jun 2015
Last PDS Update 03 Oct 2018

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.

The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.

In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

Title Document Type Document Date
Hazelnut Value Chain Development Project: Faster Approach to Small Nonsovereign Transactions (FAST) Report Faster Approach to Small Nonsovereign Transactions Jun 2015
Hazelnut Value Chain Development Project: Initial Poverty and Social Analysis Initial Poverty and Social Analysis Jun 2015

Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

None currently available.

Evaluation Documents See also: Independent Evaluation

None currently available.

Related Publications

None currently available.

The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

Requests for information may also be directed to the InfoUnit.

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