Introduction

Despite strong economic growth and a steady decline in poverty in Bangladesh over the past decade, natural disasters regularly cause serious damage to the country’s infrastructure and agricultural sectors, severely affecting food access and food availability for the poor and vulnerable. As 80 percent of Bangladesh’s population lives in rural areas and around 53 percent of the rural population is classified as poor, climate shocks and stresses have particularly negative implications for their food, livelihood security, and welfare.

Government of The People’s Republic of Bangladesh has received an IDA credit toward the costs of the Modern Food Storage Facilities Project (MFSP), being implemented by the Directorate General of Food, Ministry of Food. Bangladesh experiences frequent catastrophic weather events resulting in heavy losses in lives and property. Because of these weather related challenges, the Government of Bangladesh is implementing programs aimed at minimizing loss and expediting recovery from these events.

The modern food storage facilities proposed for construction under this project could considerably improve the efficacy of the government’s emergency response and recovery efforts in disaster-prone areas, and could enhance the efficiency of its Public Food Distribution System. To respond to the above challenges, GoB seeks to improve its capacity to respond to short and longer term post-disaster food and nutrition security needs by enhancing its network of food grain storage facilities and building modern food storage facilities; at the same time, it aims to improve the efficacy and accountability of the public food grain system.

Modern storage facilities proposed for construction under this project in different strategic locations across the country will allow grain to be kept in bulk for up to two to three years in better conditions relative to the godowns used currently, with reduced grain losses and enhanced nutritional value of the grain distributed. With strengthened capacity for improving stock management in the modern silos, and comprehensive analyses for enhancing the overall policy framework on strategic grain reserves, GoB will be in a position to make sound and informed decisions as it reconciles the three strategic objectives that impact the domestic food market:

• Supporting the poor and vulnerable through effective Social Safety Net programs
• Improving the country’s disaster preparedness to meet food security needs caused by disaster-induced food shortages and
• Devising non-distortive market interventions for food price stabilization, mainly for coarse grain consumed by the poor and vulnerable.

Basic Project information & Milestones

Country	Bangladesh
Project	Modern Food Storage Facilities Project  (MFSP)
Supervising Entity	World Bank
IDA Credit No	52650-BD
Project ID	P 120583
Project Approved by ECNEC	11 March 2014
Financial Agreement Signed Date	07 April 2014
GO Issued from Planning Commission	08 April 2014
GO Issued from Ministry of Food	05 May 2014
Date of Commencement	January 2014
Appointment of PD	06 August 2014

PROJECT DEVELOPMENT OBJECTIVE:

The overall project development objective is to increase the grain reserve available to households to meet their post-disaster needs and improve the efficiency of grain storage management.

SPECIFIC OBJECTIVE OF THE PROJECT:

The overall project development objective is to increase the grain reserve available to households to meet their post-disaster needs and improve the efficiency of grain storage management.

• Develop 8 Silo complex of capacity 5.36 lakh MT
• Facilitate households access to domestic silos to ensure household level food security (5 Lakh)
• Reduce storage losses
• Adopt the best suited technology for preservation of food grain quality, quantity and nutritional level
• Ensure safe storage of food grain during calamities
• Ensure Better monitoring and improved governance and management of food stocks.

FINANCING OF THE PROJECT:

Source	Available Fund (million $)	Remarks
IDA Grant	210.00	PA (RPA)
BCCRF Grant	25.00	Through IDA
Beneficiary contribution	05.00	Through Service Provider
GoB Grant	0.42	BDT 3.35 Crore
Total	240.42

PROJECT BENEFICIARIES:

At least 10 million people (or some 25 percent of the population living in the project area) are expected to directly or indirectly benefit from the project, primarily vulnerable and poor people in areas regularly affected by floods and cyclones. The latest poverty assessment indicates that 31.5 percent of the country’s population is considered poor while about 17.6 percent live in absolute poverty. About 500,000 households (around 2.5 million people) will directly benefit from facilitated access to household silos. A portion of the recipients of foodbased safety net programs will indirectly benefit from the project through the improved quality of the food grain released from the modern storage facilities. It is estimated that over half of all beneficiaries will be women and children.

COMPONENT :

Component A –
Construction of Modern Grain Storage Silo Facilities : This component will support: (A1) construction of public storage facilities with a capacity of about 535,500 tons in the form of modern grain storage silos; and (A2) provision of household storage facilities (household silos) particularly in the disaster-prone areas of the coastal zone for about 500,000 households; and (A3) implementation of social and environmental management plans.

Component B –
Support for Food Planning and Monitoring Program: This component will provide: (B1) Support for Food Planning and Policies and (B2) Support for Food stock and Market Monitoring System.

Component C –
Project Management, Construction Supervision, Technical Assistance, Training and Strategic Studies: This component will finance costs- (C1) Project Management Support, GAAP, Panel and audits, (C2) Construction Supervision and contract management and (C3) Capacity Building, TA, Training, strategic studies, Future Project Preparation, etc.

PROJECT DESCRIPTION

Component A –
Construction of Modern Grain Storage Silo Facilities The primary objectives of this component are to:

Component A1:

Construction of Modern Public Food Grain Storage Silos:
This component will finance an improved storage silo system to store milled rice with a total capacity of around 535,500 tons. Subject to full compliance with the requirements in the publicly disclosed Environmental and Social Assessment and Management Framework (ESAMF) and prior completion of all complementary, site-specific studies and analyses required, the silos will be constructed at eight sites in various strategic locations across the country.

Project Site & Capacity:

Sl. No.	Site	No. of Bins	Bin Size (in feet)	Each bin capacity (MT)	Silo capacity (MT)	Grain Type
1	Barisal	16	60 D X 40 H	3,000	48,000	Rice
2	Narayanganj	16	60 D X 40 H	3,000	48,000	Rice
3	Dhaka	16	60 D X 40 H	3,000	48,000	Rice
4	Ashuganj	35	60 D X 60 H	3,000	105,000	Rice
5	Mymensingh	16	60 D X 40 H	3,000	48,000	Rice
6	Maheshwarpasha	6	90 D X 78 H	12,700	76,200	Wheat
7	Chittagong	9	90 D X 78 H	12,700	114,300	Wheat
8	Madhupur	16	60 D X 40 H	3,000	48,000	Rice
	Sub-Total	130			535,500

Site Selection Criteria
(General Criteria : Availability of DG Food Land)

Proposed Sites	Region	Criteria
Barisal CSD & M Pasha Khulna site	South central	Disaster relief: Cyclones
Narayangonj CSD	Central and South	Disaster relief: Flooding
Modhupur and Mymensing CSD	North	Surplus production
Dhaka CSD	Central	High consumption & food deficit
Ashugonj Silo site	Northeast	Processing & logistics hubs
Chittagang Silo Premises	Southwest	Import and Supply to all over the Country

The eight sites proposed are on land currently owned by DG Food, so no land acquisition will be required. In the event that the local conditions at any of the eight proposed sites evolve prior to actual construction or if the site specific, complementary studies bring new information to light, a new assessment of the eligibility and feasibility of silo construction at that site will be carried out – and an alternative location possibly considered.

Component A2:
Household Silos:
Under the 2007 Emergency Cyclone Recovery and Reconstruction Project (ECRRP, P111272), household-level silos or grain storage bins were developed in Bangladesh. These units are specially designed 70-liter, food-grade plastic bins tested to ensure that chemical contaminants do not migrate into the stored food. They hold about 40kg of paddy equipped with a watertight lid, preventing water intrusion from surges and floods. Provision of home storage units under ECRRP has been extremely successful; under FAO coordination some 20,000 units were distributed. Based on the lessons learned from the ECRRP, this project’s investment in small-scale storage at the rural household level is expected to bring important benefits to the farming community – in the form of safer storage of rice, seed and the enhanced capacity of affected households to have seed readily available for subsequent planting seasons. Small-scale home silos will be sold via a network of service provider to eligible households at a subsidized price under a voucher scheme implemented by a third party. The procurement price of storage bins currently ranges from US$23 to US$33 per unit, down from US$50 at the start of ECRRP.

Component A3:
Implementation of Social and Environmental Management Plans :
The sites proposed for public silos are already owned by GoB. Therefore, no major social or resettlement issues are expected. However, funds will be provided under this component to ensure that if any such issues arise they can be addressed properly. These issues encompass, for example, increased traffic congestion or other environmental or social issues resulting from the complementary site-specific studies which are required to be fully addressed prior to invitation for bidding, and others that could emerge during silo construction. The component will also support environmental enhancement, such as improved landscaping, planting of trees to improve the aesthetics of tall steel silos, and more.

Component B –
Support for Food Planning and Monitoring Program

Component (B1)
Support for Food Planning and Policies-The objective of this component is three fold:
(i) to enhance the institutional capacity of DG Food and the Food Planning and Monitoring Unit (FPMU) and support these agencies in carrying out their respective mandates; (ii) to address analytical gaps and support the development of an evidence-based policy framework to improve the efficiency and performance of the country’s overall food storage system and management of strategic grain reserves; and (iii) to improve the coordination of public agencies (in particular DG Food and FPMU with MoDMR) involved in procurement, public storage, and distribution of food grains, as well as disaster relief.

A range of studies will be developed, undertaken, and disseminated under Component B1 to answer strategic challenges -(i) the “optimum” volume of grain to be stored and its implications on GoB’s policies; (ii) the impacts of GoB food market interventions on price stabilization and broader food markets; (iii) the improvements needed in the enabling environment conducive of an increased participation of the private sector in modern grain storage facilities; (iv) a strategy for disposal of grain stored in the modern facilities; (v) evaluation of the current physical condition of existing public storage facilities; (vi) development of the policy, legal, and institutional framework and technical requirements for nutrient fortification; and (vii) introduction of a warehouse receipt system.

This program will be hosted by FPMU in close collaboration with DG Food and in partnership with a “joint venture” between a renowned national and an international institution. The program will become a platform for evidence-based policy dialogue between MoFood and MoDMR as well as other ministries.

Component B2
will also support the development, installation, and initial operation of a nationwide electronic monitoring system for food stocks. This modern food stock monitoring system will be coordinated by DG Food. To that effect, this component will include the establishment of a food monitoring center under DG Food. Technical assistance will be provided under this component to finance improvements in the monitoring and management of food storage/stock and to introduce a modernized system that will enable GoB to better plan and monitor food stocks nationwide.

Component C -
Project Management, Construction Supervision, Technical Assistance, Training and Strategic Studies This component will finance costs required to ensure adequate overall management of the project, monitoring and evaluation of the activities implemented, and capacity enhancement of selected stakeholders. It will include:

(C1) project management of the task; incremental staff and expenditures of DG Food in implementation of the project; the costs for implementing the Governance and Accountability Action Plan, including a panel of experts, as needed, a Procurement Panel, an audit, and other such costs;

(C2) cost of consultants for preparation of bidding documents, construction supervision, and update of designs required during construction; this will among others include costs for construction supervision and monitoring and evaluation of project impacts;

(C3) provision of technical assistance, training, institutional capacity building, preparation of future projects, and any strategic studies needed during project implementation and not covered under Component B.