World Bank Approves US$ 50 Million Additional Credit for Increasing Agricultural Production and Market Access in Assam, India

March 8, 2012

So far more than 300,000 small and marginal farmers mobilized

WASHINGTON, March 8, 2012:  The World Bank today approved a US$50 million additional credit to support on-going activities under the Assam Agricultural Competitiveness Project (AACP) which aims to increase the productivity, profitability, and market access of the farming community in the Indian state of Assam.

The additional credit will complement and ensure its long-term sustainability.

The focus is on mainstreaming management approaches and best practices, make ground water usage more sustainable by setting up water quality monitoring stations, strengthen the Agriculture Technology Management Agencies (ATMAs) to provide better agricultural services and improve the rural road network for better market connectivity. Investments in rural roads — about 113 km — in selected districts covering areas that do not fall under the Pradhan Mantri Gram Sadak Yojna (PMGSY), will demonstrate low-cost road construction and innovative bridge designs which can be used to connect smaller habitations and linking agriculture production with markets in a cost-effective manner.

Specifically, it will scale up the Project’s impact by building synergies with ongoing schemes of the Government of Assam (GOA) and the Government of India (GOI); establish a system for sustainable use of groundwater; and mainstream project collaboration with the private sector; as well as enhance investments in irrigation, drainage, mechanization, extension advice, rural haats (markets) and roads to increase production, productivity and market access in selected districts.

“According to the Planning Commission estimates of 1999-2000, about 36 percent of the people in Assam live below the poverty line and the state is fourth in terms of poverty ratio, next only to Orissa, Bihar and Madhya Pradesh. Assam is a focus state for Government of India’s poverty alleviation initiatives,” said Mr. Roberto Zagha, World Bank Country Director for India. “The ongoing Project has played an important role in increasing the productivity and market access of targeted farmer groups of the state — primarily the small and marginal farmers — and has mobilized more than 300,000 beneficiaries in more than 63,000 beneficiary groups across the fishery, agriculture, dairy, forestry, and livestock sectors,” he added.

“The Project takes an integrated approach toward enabling farmers to take advantage of rapidly changing consumer demand and marketing channels,” said Manivannan Pathy, Project Task Manager and Senior Agricultural Specialist, World Bank.

Since one of the objectives of the additional credit is to scale up some of the successful investments under the original Project, investments will also focus on increased crop production through a combination of increased irrigated Boro rice production, crop diversification, improved extension advice, expanded use of micro-nutrients, and opening up additional production areas through drainage.

The Project will be financed by a credit from the International Development Association (IDA) – the World Bank’s concessionary lending arm – which provides interest-free loans with 25 years to maturity and a 5-year grace period.

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