ADB lends SAL $14.2m to enhance agribusiness inclusiveness
FE Report | Thursday, 21 March 2019
The Asian Development Bank (ADB) will provide US$ 14.2 million as loan to support the expansion plans of Sylvan Agriculture Limited (SAL), a PRAN-RFL Group (PRAN) company.
The loan aims to enhance inclusiveness in the agribusiness sector by lifting the incomes and skills of farmers, particularly women, an ADB press release said.
PRAN-RFL Group Director (Finance) Uzma Chowdhury and Deputy Director General of ADB's Private Sector Operations Department Christopher Thieme signed the loan agreement on behalf of their respective sides at a city hotel on Tuesday.
The ADB's assistance will finance new food processing facilities to produce potato chips, potato flakes, and pasta.
Under a gender action plan, women will comprise at least half of the 450 people directly employed in the new facilities, it said, adding that gender wage gaps would be reduced, women's facilities introduced, and greater technological assistance provided to women farmers.
"Agriculture plays a key role in Bangladesh's economy and development, providing nearly half of all employment in the country and supporting over 70% of the total population," it said, quoting ADB Investment Specialist for Private Sector Operations Tushna Dora.
"ADB's second loan to SAL will further improve the agribusiness sector in Bangladesh through increased private sector investment. It will enhance the livelihoods of thousands of local farmers, with a focus on empowering women to gain new skills that can be used to earn better incomes," she was quoted as saying.
Potatoes for the new processing facilities, located in Habiganj industrial park in the northeastern part of Bangladesh, will be sourced from around 2,000 contract farmers, integrating them in a sustainable agricultural value chain.
The project is expected to increase contract farmers' income by at least 50 per cent as they introduce new potato varieties, expand the area they cultivate, and benefit from the assurance that their production will be bought by SAL.
The project is ADB's first repeat assistance to a private sector borrower in agribusiness, the press release said.
In 2012, ADB approved a $25.1 million loan to SAL for the construction of processing facilities, including for liquid glucose and starch made from cassava sourced from contract farmers.
PRAN produces more than 200 food products under 10 different categories including juices, mineral water, carbonated beverages, bakery products, snacks, biscuits, confectionary, and dairy products.
It is one of Bangladesh's largest private employers, with around 95,000 staff. In addition, the group has engaged with more than 100,000 contract farmers across various crops.
Ahsan Khan Chowdhury, Chairman and CEO of PRAN-RFL Group, Eleash Mridha, Managing Director of PRAN Group, Cai Li, Deputy Country Director of ADB for Bangladesh and other senior officials from both organisations were present at the programme.