Jamshedpur, India, April 30, 2003
—The International Finance Corporation, the private sector arm of the World Bank Group, and Usha Beltron Limited (UBL), India’s leading manufacturer of steel wire ropes and wires, signed an agreement today to promote women’s enterprise development among rural communities in Jarkhand.
The agreement was signed by IFC Executive Vice President, Mr. Peter Woicke, who is visiting India, and the Usha Martin Group Chairman, Mr. B. K. Jhawar.
UBL is the principal corporate sponsor of Krishi Gram Vikas Kendra (KGVK), a nongovernmental organization established in 1977 to improve the livelihoods of Jarkhand’s rural poor. KGVK implements health, education, agricultural extension, women’s empowerment, and natural resource management initiatives in 115 villages in and around the cities of Jamshedpur and Ranchi. Many of Jarkhand’s rural poor belong to India’s minority tribal population.
The 15 month program – jointly funded with contributions from Usha Martin
Group and IFC’s Corporate Citizenship Facility – will link KGVK with SEWA (Self- Employed Women’s Association), India’s most successful model of informal sector enterprise development for women. SEWA will provide training and technical support to KGVK to strengthen its capacity to identify and promote enterprise development opportunities for rural women. The program will continue to support the implementation of a number of pilot projects that, if successful, will be integrated into KGVK’s future developmental activities.
IFC’s Small and Medium Enterprise Department currently provides direct support to SEWA for strengthening management capacity and expanding its Trade Facilitation Center, which markets handicrafts produced by its membership. The overall goal is to increase the entry of SEWA’s handicrafts into global markets by tightening its supply and distribution chains, adopting an e-business strategy, and linking production with demand forecasts.
“IFC’s global expertise in manufacturing has benefited UBL immensely in focusing on our core business of wire ropes and wires,” said Mr. Jhawar. “Our long-term partnership enables us to look forward to maintaining the best international standards in corporate governance and environmental and social responsibility.”
Commending UBL’s commitment to increasing employment and diversifying economic opportunities for rural women, Mr. Woicke said, “IFC and UBL believe that a commitment to sustainable development strengthens a company’s competitiveness in the international marketplace and also shows the way for other Indian companies to move beyond philanthropy and provide sustainable economic opportunities for neighboring communities.”
IFC assists its client companies in managing their businesses in a way that protects the environment and adds to the welfare of the communities in which they operate. A central part of IFC’s role in India is to help companies like UBL achieve and maintain international competitiveness. UBL is the third largest producer of wire rope in the world, with manufacturing facilities in India, UK and Thailand.
In September 2002, IFC provided a $24.6 million financing package to UBL to expand its operations, strengthen its balance sheet, and increase capacity utilization. IFC played a key role by providing long term debt and equity financing on its own account, and mobilizing long term debt from other investors. In addition, IFC provided UBL with valuable advice on setting up a cogeneration power plant which will reduce emissions and power costs by using waste flue gases from the company’s direct reduced iron plant to generate power.
IFC's mission is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people's lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. Since its founding in 1956 through the close of the last fiscal year on June 30, 2002, IFC committed more than $34 billion of its own funds and arranged $21 billion in syndications for 2,825 companies in 140 developing countries. IFC's committed portfolio at the end of FY02 was $15.1 billion for its own account and $6.5 billion held for participants in loan syndications.
IFC’s Corporate Citizenship Facility, which is providing grant money to UBL for this project, is a multidonor fund aimed at helping IFC’s direct investment sponsors in areas of engagement related to the environmental, social, or labor dimensions of company operations. CCF currently benefits from grant support of the Dutch and Norwegian governments as well as from IFC.
