IFC plans $30m loan for Indian pulses plants

The debt investment backs the expansion of ETC Agro Processing India Private Limited's pulses milling operations in Kolkata, India.

The International Finance Corporation of the World Bank Group is planning to make a debt investment as large as $30 million for the expansion of ETC Agro Processing India Private Limited’s pulses milling operations in Kolkata, India.

The five-year senior loan supports the final construction of a cluster of four pulses milling plants in an area of the Port of Kolkata zoned for green business activities, according to a proposed investment disclosure from the IFC. The total cost of the project, including working capital for processing and trading, is approximately $98 million.

ETC Agro is a 60 percent subsidiary of ETC Group (ETG), one of IFC’s key clients in Africa. Founded in Kenya in 1967, ETG is one of the largest agricultural conglomerates in Africa, with a presence in sub-Saharan Africa, North America, Europe, the Middle East and Southeast Asian countries.

ETG ships approximately six million metric tons of agricultural commodities — such as cashews, oilseeds, sugar, coffee, pulses, wheat, fertilizer, rice, maize and sesame seeds — around the world and directly employs more than 7,000 people globally, according to the disclosure.

The new Indian pulses processing facility of 300,000 million tons per year (MTPA) will be one of the largest pulses processing plants in the world, handling yellow peas, lentils, green gram and black gram, and brings the company’s Indian processing capacity to about 475,000 MTPA.

“Ostensibly a dry mechanical process, the processing is practically without waste as all of the incoming food material is turned into useful products of one kind or another,” according the IFC documents.

The project construction is nearing completion, with major civil work complete and milling now occurring on 50 percent of the site. Construction of a packaging building, permanent offices, warehouse, and worker accommodations is ongoing.

An “IFC supervision visit” conducted this month revealed that ETG had ramped up its environmental and social management (E&S) operations to a satisfactory level, following a two-year stretch where “the performance of ETG with respect to environmental and social management was judged to be in need of improvement.”

Recent developments helping to rectify the situation included the hiring and training of a E&S supervisors throughout its African operations. Previous visits confirmed that ETG’s Indian operations were in compliance with the IFC’s E&S standards.

The new investment is pending approval until a 27 March board meeting.