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The project is worth $142.9 million, or about Rs 1,000 crore, of which 70% would be lent by Asian Development Bank and the balance will come from state government.

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The project period is six years, from 2021 until 2027.

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The project aims to support value addition in post-harvest segments of targeted horticulture value chains, facilitate agribusiness investment, stimulate Farmer Producer Organizations (FPOs) and Value Chain Operators (VCOs) within the value chain, support resilient horticulture production systems and enhance private sector participation. The project is expected to enhance food security through reduction of waste, and alleviate rural poverty by providing rural farmers enhanced opportunities for productivity, participation in the value chain, and income generation. The project aims to mainstream opportunities for women and other vulnerable groups by developing and implementing a gender action plan.

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The main outputs are:
Output 1: To strengthen institutional capacities of agribusiness institutions and farmer producer organizations.
Output 2: To strengthen financial and agribusiness capacities of farmer producer organizations and value chain operators. The output includes (a) matching grants and (b) subsidiary loans to Farmer Producer Organizations (FPOs) and Value Chain Operators (VCOs); and
Output 3: To improve agriculture value chain infrastructure.

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The target crops covered by MAGNET are
1. Banana,
2. Custard Apple,
3. Green and Red chili,
4. Guava,
5. Okra,
6. Orange,
7. Pomegranate,
8. Sapota,
9. Strawberry,
10. Sweet Lime,
11. Flowers,
12. Mango,
13. Lemon,
14. Cashew Nut, and
15. Snake Gourd.

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The main qualifications and selection criteria for FPOs for matching grants are:

• Legally registered FPOs, farmer cooperative societies, and other producer organizations (legal entities) also including cluster level FPO federations/ associations. If FPO is not a legal entity at the time of application, it should apply for legal registration and should be legally registered at the time of grant agreement.
• FPO should be a legally registered entity with audited books of Accounts (audited by a Chartered Accountant).
• FPO should not have been declared as non-performing asset (NPA) by a bank/FI due to a past loan default.
• FPO should not have any significant adverse audit observations in its previous annual audits.
• Minimum Shareholding of FPO should be 250 producers. However, for associations/federations, minimum shareholding should be 10 institutional members and for MAVIM Community Managed Resource Centres 10 Self Help Groups with an aggregate shareholder base of minimum 2,000 members.
• At least 60% of applicant FPO’s shareholders should be involved in production of one or more of the targeted crops and collectively have considerable production within their catchment zone.

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The project will provide matching grants and FILs to FPOs and VCOs through 300 subprojects. The matching grants will support development of FPOs’ post-harvest facilities and finance up to 60% of development costs. The FILs will support working capital and infrastructure needs of FPOs and VCOs for domestic and export markets through financial intermediaries.

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1. Bank of India
2. Samunnati Financial Intermediation and Services Private Limited

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At least 20% of the projects are targeted to be provided to women-owned or –led FPOs or VCOs and preference will be given to vulnerable group-led and -owned FPOs or VCOs. In addition, at least 20% of the financial support will be allocated to FPOs and VCOs owned or led by women.

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Gender-responsive design ensures a safe work environment for women, including separate washrooms for women and persons with disabilities.

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Project activities under Output 1 (capacity development) may positively impact FPOs with indigenous peoples as members by providing them with training to improve agribusiness, including introduction of best practices and latest technologies to enhance safety, quality, and productivity; sustainable and efficient management of commercial and financial functions; and support to digital and direct marketing initiatives.
Gender Equality and Social Inclusion Action Plan is supporting the enhanced inclusion of IPs in the project including a baseline assessment of IP involvement in FPOs and training to target IP-owned and/or -led FPOs and VCOs. Subprojects with significant and/or adverse impacts on indigenous peoples will not be financed under the FIL.

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MAGNET Project gives financial assistance under matching grant and intermediation loan to projects that facilitates improvement, reduction in post harvest losses, improving quality, value addition and marketing of one or more selected horticulture commodity. MAGNET project will support activities including the setting up of post-harvest processing facilities, i.e., facilities like appropriate storage at farm level, collection center, pack house. Primary processing facilities such as sorting, grading and packaging facilities, and secondary processing like any mechanized and mobile processing facilities, appropriate transportation infrastructure, setting-up of retail outlets, creation of e-market etc.

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• Farmer Producer Organizations registered under Company Act, Co-operative Societies Act, Farmer Groups/ Cluster Level Federations (CLFs)/ Community Managed Resources Centers (CMRCs) registered with Agricultural Technology Management Agency (ATMA)/Maharashtra State Rural Livelihood Mission (MSRLM)/ Mahila Arthik Vikas Mahamandal (MAVIM) also including Cluster Level FPO Federations/Associations)
• Value Chain Operators (non-FPO entities) which may include aggregators/ processors/ exporters/mid- and large-sized retail organizations/Ag-tech or Fintech organizations working actively with producers and their collectives of any horticultural commodities

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• Market Led Production Activities like investment in Traceability Systems, Farm Equipment/ other capital investment such as High Density Plantation, Integrated Pest Management etc.
• Post-harvest processing Facilities such as setting up of main infrastructure which may include Technical Civil works (to house Core Plant & Machinery and other equipment), Pack-house, Cold Storage Unit, Integrated Pack-house, Ripening Chamber etc.
• Agri-Logistics such as controlled temperature/ventilated trucks or Mobile precoolers etc.
• Marketing / Consumption Points such as Setting up of appropriate storage facility cum Distribution Center at market level or retail outlets etc.

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• Non-technical civil works such as administrative office, approach road/internal roads, compound wall, cost of land, site development, canteen, labor rest room, quarters for workers, security guard room etc.
• Second hand/ old machineries
• Reconditioned and refurbished plant & machinery
• AC ducting, furniture, computers and allied office items
• Closed Circuit TV Camera and security system related equipment
• Fuel, Consumables, Spares and Stores
• Non-Temperature Controlled Transport vehicles etc.

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The project is categorized as effective gender mainstreaming. The GESI AP aims to particularly promote women, vulnerable groups and Persons With Disabilities (PWDs). The GESI Action Plan activities will ensure that women-owned or - led FPOs and VCOs will be prioritized in capacity development and financial support. The key activities are :

• Strengthening of institutional, technical, and marketing capacities of agribusiness institutions and FPOs.
• Strengthening of access to finance of FPOs and VCOs.
• Ensuring improved agriculture value chain infrastructure so that construction activities abide by core labor standards, prohibition of child labor and GESI related aspects.

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The project will provide policy guidance and capacity development support to agribusiness institutions and FPOs through -

• Crop-specific, public–private collaboration for achieving higher productivity, better harvest quality and post-harvest handling, and relevant certification;
• Introducing best practices and latest technologies to improve safety, quality and productivity;
• Capacity building of FPOs for sustainable and efficient management of commercial and financial functions, particularly for FPOs owned and led by women;
• Supporting digital and direct marketing initiatives by FPOs for generating new business–consumer and business–business trades (including possible exports) and realizing better sale prices.

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The project will support the recruitment of local men and women, including SCs, STs and other vulnerable groups, for construction and operations. It will be ensured that labor standards are followed and giving priorities to employ local people for works; to ensure equal opportunities for women and men; and equal wages for work of equal value, and pay women’s wages directly to them, and not employ child or forced labor and to provide appropriate facilities for child dependents in construction campsites.

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In compliance with ADB’s Safeguard Policy Statement, 2009 (SPS), the project’s Environment safeguard categories are category B. The project has both a project loan component, which follows the general environment requirements of SPS, and investment of funds through FIL and matching grant requiring a tailored approach to address environmental impacts and risks. The project is categorized as “B” because the project adheres to ADB’s classification system, which is based on the most environmentally sensitive component. The environmental risks and impacts due to the infrastructure development under Output 3 are only site-specific and temporary. Under the FIL and matching grant components, the proposed financial support for FPOs and VCOs under Output 2 will not allow large investments that can cause significant and irreversible environmental impacts (i.e., category A projects). The FIL and matching grant components will only allow subprojects that are category B and C according to SPS’ categorization, and the MAGNET Society and financial intermediaries will agree on environment and social management system (ESMS) arrangements.