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Project detail:
ADB proposes to provide a loan facility of up to $80 million to Olam Global Agri Private Limited (OGA) and Olam Global Agri Treasury Private Limited (OGTPL). The loan will be guaranteed by the ultimate holding company Olam Group Limited (OGL). The use of loan proceeds will be earmarked for working capital in Bangladesh, India, Indonesia, Nepal, Pakistan and Viet Nam. The facility will have a maturity of 3 years.
The project will support the populations in Bangladesh, Indonesia, and Nepal by increasing access to essential food staples (wheat and pulses) and thus supporting food security. In addition, the project will support the livelihoods of smallholder rice farmers in India, Pakistan, and Viet Nam by financing rice exports from these countries. Disruptions to supply chains caused by the Russian invasion of Ukraine have induced a commodity supercycle leading to increased food insecurity for populations dependent on food imports and for smallholder farmers whose livelihoods are under threat due to increased input prices.
The project is aligned with ADB recently announced $14 billion initiative to support long-term food security in the Asia and Pacific region over 2022 to 2025. The project is also aligned with ADB Strategy 2030, which calls for ADB to increase financing for agribusiness and promote gender equality in at least 75% ADB committed operations (by number) by 2030._The project is aligned with the Operational Plan for Private Sector Operations, 2019 to 2024, which calls for working with tier 1 agribusinesses because of the potential widespread impact; consistent with ADB country partnership strategies for Bangladesh, India, Indonesia, Nepal, Pakistan, and Viet Nam; and is aligned with the International Financial Institution Action Plan to Address Food Insecurity (goal 2), which calls for agribusiness lending for staple food working capital and liquidity. The project is consistent with Strategy 2030 operational plans for operational priority (OP) 1: addressing remaining poverty and reducing inequalities, by supporting smallholder farmer livelihoods; OP 2: accelerating progress in gender equality, by supporting women workers and farmers; OP 5: promoting rural development and food security, by helping to integrate farmers, agribusinesses, and consumers into efficient value chains. As a regional project supporting cross-border trade benefiting six DMCs, it is consistent with OP 7: fostering regional cooperation and integration.
Note: please download project document attached to this project for more information.
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