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| Summary of Project Information (SPI) |
| This Summary of Project Information is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. |
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| Project number | 24083 |
| Project name | URL Expansion |
| Country | India |
| Sector | Agriculture And Forestry |
| Department | Agribusiness |
| Company name | United Riceland Limited |
| Environmental category | B |
| Date SPI disclosed | February 4, 2005 |
| Projected board date | March 17, 2005 |
| Status | Active |
| Previous Events | Invested: September 26, 2005
Signed: June 27, 2005
Approved: April 5, 2005 |
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| Description of company and purpose of project |
United Riceland Limited (URL or the company) is one of India’s leading rice millers and exporters specializing in the premium segment of Basmati rice. URL was established in 1981 at Samana in the state of Haryana, 150 km north of New Delhi by the Thakrar family to export brown Basmati rice to the United Kingdom (U.K.). The company currently sells its products to the European Union (EU), the Middle East and is also active in the domestic market.
IFC entered into a $10 million Loan Agreement with URL in 1996. The purpose of the loan was to finance the construction of a modern Basmati rice milling facility on a new site located 25km southwest of New Delhi, in Gurgaon. Since then actual market developments as well as a positive turn in tariffs for Basmati rice has resulted in URL’s decision to increase the project’s scope.
The company plans to increase aggregate capacity from 21 tons per hour to an aggregate nominal capacity of 30 tons per hour with a plant design to produce brown and white rice for sales to the EU, the Middle East, other countries and the domestic markets. |
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| Project sponsor and major shareholders of project company |
| The company is privately held and is beneficially owned by Mr. N.R. Thakrar and other members of his family. |
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| Total project cost and proposed IFC investment |
| The total project costs are estimated at $51 million. The proposed IFC investment is a $8.5 million A Loan for IFC’s own account. |
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| Location of project and description of site |
| The new plant will be on a 25.01 hectare site in Gurgaon, Haryana State, 25km southwest of New Delhi. |
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| Project Development Impact and IFC's Role |
The project will lead to increased supply market efficiency through URL procurement of rice from nearly 200,000 farmers. In the absence of an efficient domestic marketing system for cereals, URL has been instrumental in working with the Government agencies to increase transparency in the market place. URL is one of the major participants in auctions in around 60 purchase points (‘mandi’) which serve a large number of villages. It has contributed to strengthen these market institutions that improve price discovery for the benefit of local farmers. In addition to that as the Indian government has announced its intentions to liberalize grain marketing and storage in the country, URL would undoubtedly contribute to the further development of the private sector in these critical areas of the grain supply chain.
In its direct support to firms, IFC’s strategy is to invest in companies which are
- developing new products and markets;
- restructuring and modernizing to become internationally competitive; and
- expanding and moving towards a regional or global presence.
In doing so IFC will focus on providing firms with long-term debt and equity which may not be available from domestic financial markets; and on adding value in the areas of global best practices, creating international partnerships, entering new markets, environmental and social sustainability and corporate governance. |
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| Environmental and social issues - Category B |
This is a category B project according to IFC's environmental review procedure because specific impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines, or design criteria. At the time the project was appraised in 1996 and 2001 key social, environmental, and health and safety issues analyzed were air emissions; liquid effluents; solid wastes; ambient noise; fire and explosion risk; use of insecticides; and general employee health and safety. Additional issues to be assessed during this appraisal include source and volumes of water required for both plants, including efforts to minimize water use; plant hygiene and product quality; use and disposal of hazardous materials; and corporate social responsibility efforts.
To view the environmental documents for this project, click here |
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| Location of environmental documents in locally affected community |
The ERS will be disclosed in the local library, Civil Lines in Gurgaon. In addition to that with the local ‘Panchayat’ (community representative recognized by the Government).
The advertisement will be published in the “Dainik Mewat”, 753/6, Sadar Bazar, Gurgaon (Tel.: +91-124-2321047), a daily newspaper published in Gurgaon. |
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| To contact the project company, please write to: |
R.S. Seshadri
Director
Phone: 91-98-101-81056
seshadri@unitedriceland.com |
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