India : Sustaining Poultry Farmer Income and Food Security Project
Suguna's business has been significantly impacted by Covid-19. There were false rumors in India associating chickens with the spread of Covid-19 leading to a sharp contraction in demand. The situation was further aggravated by supply disruptions as a result of the lockdown. The project will provide essential liquidity support to Suguna helping it sustain operations and livelihoods of 40,000 contract poultry farmers and over 7,700 employees.
Private Sector Operations Department
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- Agriculture, natural resources and rural development
|Project Name||Sustaining Poultry Farmer Income and Food Security Project|
|Borrower / Company||Suguna Foods Private Limited
|Country / Economy||India
|Type or Modality of Assistance||
|Operational Priorities||OP1: Addressing remaining poverty and reducing inequalities
OP2: Accelerating progress in gender equality
OP5: Promoting rural development and food security
|Sector / Subsector||
Agriculture, natural resources and rural development / Livestock
|Gender||Some gender elements|
|Responsible ADB Department||Private Sector Operations Department|
|Responsible ADB Division||Office of the Director General, PSOD|
|Responsible ADB Officer||Mosnier, Zsuzsanna|
|Description||Suguna's business has been significantly impacted by Covid-19. There were false rumors in India associating chickens with the spread of Covid-19 leading to a sharp contraction in demand. The situation was further aggravated by supply disruptions as a result of the lockdown. The project will provide essential liquidity support to Suguna helping it sustain operations and livelihoods of 40,000 contract poultry farmers and over 7,700 employees.|
|Objectives and Scope||The project will help Suguna sustain its business operations through the Covid-19 crisis, by providing financing for working capital and operational expenditure. In addition, due to supply chain disruptions, Suguna plans to maintain higher levels of inventory (feed and medicines) to ensure adequate buffers for sustained operations. Suguna has been significantly affected by the coronavirus disease (COVID-19). False rumors in India associated chickens with the spread of COVID-19, leading to a sharp contraction in demand. The situation was aggravated by supply disruptions caused by the lockdown. This has resulted in losses and tight liquidity conditions for Suguna. The project will provide essential liquidity support to Suguna, helping it sustain the operations and livelihoods of 40,000 contract poultry farmers and more than 7,700 employees. The project will support rural livelihoods, sustain gender inclusion, and reduce malnutrition through the production of affordable animal proteins during this unprecedented health, economic, and social crisis.|
|Status of Development Objectives||
The project has started contributing to its development objectives.
|Status of Operation/Construction||The facility comprised of 3 tranches, each up to $5 million. Tranche 1 and 2 were disbursed on 29 April 2021 and 29 September 2021 respectively and enabled Suguna Foods to sustain its operations amidst increased working capital requirements due to disruptions from Covid-19. The availability period of the facility has expired with Suguna not availing Tranche 3.|
|Linkage to Country/Regional Strategy||The project is aligned with Strategy 2030, which calls for ADB 'to scale up its financing for agribusiness. The project is also aligned with the Operational Plan for Private Sector Operations, 2019-2024, which calls for working with strong Tier 2 companies from large DMCs such as the PRC, India, Indonesia, and Thailand as it is strategically important for ADB to engage with companies that will at some point expand beyond their borders and invest in other DMCs. The project is also consistent with the country partnership strategy, 2018-2022 for India, which supports (i) increasing agricultural productivity and rural incomes, (ii) reducing the rural urban income gap, (iii) doubling farm incomes within 5 years, and (iv) promoting gender equity.|
|Summary of Environmental and Social Aspects|
|Environmental Aspects||The project is classified as category C for environment in compliance with ADB Safeguard Policy Statement (2009). The potential environmental and social impacts, as well as Suguna's capacity for environmental and social management, have been reviewed. ADB has undertaken a corporate and site level compliance audit of Suguna in November 2019 through an external party. This emergency loan will support working capital needs to maintain pre-crisis activities. This transaction is anticipated to have minimal environmental and social impacts in addition to its current operations. Suguna is developing and will adopt a formal environmental and social management system (ESMS) and strengthen its environmental and social management capacity. No subprojects classified as category A or B for environment will be financed under this project.|
|Involuntary Resettlement||The project is classified as category C for involuntary resettlement in compliance with ADB Safeguard Policy Statement (SPS, 2009). Land acquisition will not be required as the project will not involve development of new facilities or expansion of existing ones. No subprojects classified as category A or B for involuntary resettlement will be financed under this project.|
|Indigenous Peoples||The project is classified as category C for Indigenous Peoples in compliance with ADB Safeguard Policy Statement (SPS, 2009). The project is not expected to directly or indirectly affect indigenous communities as it will focus on supporting Suguna's working capital needs and not build new facilities or expand existing ones. No subprojects classified as category A or B for Indigenous Peoples will be financed under this project.|
|Stakeholder Communication, Participation, and Consultation||Suguna does not currently have a formal stakeholder engagement program but engages with its neighboring communities through local authorities and conducts occasional meetings with its partner farmers. Suguna is strengthening its stakeholder engagement and community relations as part of its ESMS.|
|Timetable for assistance design, processing and implementation|
|Concept Clearance||15 May 2020|
|Credit Committee Meeting||01 Jun 2020|
|Approval||09 Jun 2020|
|Last PDS Update||13 Mar 2023|
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.
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|Title||Document Type||Document Date|
|Sustaining Poultry Farmer Income and Food Security Project: FAST Report||Faster Approach to Small Nonsovereign Transactions||Jun 2020|
|Sustaining Poultry Farmer Income and Food Security Project: Initial Poverty and Social Analysis||Initial Poverty and Social Analysis||May 2020|
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.
|Title||Document Type||Document Date|
|Sustaining Poultry Farmer Income and Food Security Project: Environmental and Social Monitoring Report (December 2021-November 2022)||Environmental and Social Monitoring Reports||Dec 2022|
|Sustaining Poultry Farmer Income and Food Security Project: Environmental and Social Monitoring Report (September 2020-November 2021)||Environmental and Social Monitoring Reports||Dec 2021|
Evaluation Documents See also: Independent Evaluation
None currently available.
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.
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