Washington, DC, June 19, 2007
— IFC, the private sector arm of the World Bank Group, and Cairn India today signed a community development
agreement that will open up business opportunities to firms in the Barmer district of Rajasthan, giving local people the chance to improve their lives. The IFC-Cairn Business Linkage Cooperation Program will establish an Enterprise Center, a rural dairy development project, and a child and maternal health initiative in one of India’s least developed states.
As a central component of the program, the Enterprise Center will provide information and expertise on business practices to local small and medium enterprises, helping them become suppliers and service providers to the oil and gas operation and other ventures in the region.
"The Enterprise Center will help local firms become suppliers to Cairn and other businesses," said Lars Thunell, IFC Executive Vice President and CEO. "These local firms, in turn, will create jobs and generate other opportunities that support communities across the Barmer region."
IFC will spearhead operations at the Enterprise Center, sharing its knowledge and experience from similar initiatives in Azerbaijan, Chad, Mozambique, and Peru, and adapting the project to the local environment. The International Centre for Entrepreneurship and Career Development will implement the activities on the premises of the Barmer Industrial Training Institute provided by the government of Rajasthan.
“The Rajasthan project is aligned with the government’s objective to secure future energy supplies. We are delighted that IFC is supporting this project and partnering with us to benefit the local community,” said Rahul Dhir, CEO of Cairn India, who signed on behalf of the company.
The dairy development project aims to increase the income of rural producers by helping establish a milk collection network in the villages. A process for selling bulk milk to end users will be set up, providing farmers with a stable market. Other components of the project include improving breeds, providing advisory services to farmers on livestock care and fodder development, and linking farmers to financial institutions and insurance services.
The child and maternal health initiative will include workshops, health camps, and awareness meetings with communities in 30 villages near the oil and gas operations. Capacity-building programs for health workers, panchayat (the council of elected village leaders), and local nongovernmental organizations will help strengthen the delivery of these programs. Awareness campaigns will include information on the prevention of communicable diseases.
This linkages program follows a $150 million, nine-year IFC loan to Cairn in 2006, in partnership with 10 international commercial banks, to help develop the company’s oil and gas discoveries in Rajasthan. Early this year, IFC invested an additional $21 million in equity in Cairn India.
About IFC
IFC, the private sector arm of the World Bank Group, promotes open and competitive markets in developing countries. IFC supports sustainable private sector companies and other partners in generating productive jobs and delivering basic services, so that people have opportunities to escape poverty and improve their lives. Through FY06, IFC Financial Products have committed more than $56 billion in funding for private sector investments and mobilized an additional $25 billion in syndications for 3,531 companies in 140 developing countries. IFC Advisory Services and donor partners have provided more than $1 billion in program support to build small enterprises, to accelerate private participation in infrastructure, to improve the business enabling environment, to increase access to finance, and to strengthen environmental and social sustainability. For more information, please visit
www.ifc.org
.
IFC in India
IFC holds a portfolio of $1.3 billion (as of June 2006) in India, the Corporation’s fourth-largest country exposure. IFC’s cumulative commitment to projects in the country since 1956 amounts to $3.3 billion. We support private sector–led development through investments and advisory services that promote growth and competitiveness. In FY06, we committed over $400 million in new investments in the country.
About Cairn India
Cairn India focuses on oil and gas in India. The company holds material exploration and production positions in eastern and western India, and new exploration rights elsewhere in the country. It has made a number of recent oil and gas discoveries, including the Mangala oil field in Rajasthan. Cairn India has an agreement for an $850 million facility with major international banks, led by IFC and the Royal Bank of Scotland, to fund Cairn’s share of development costs of the Mangala field. In January 2007, Cairn successfully concluded the floatation of Cairn India Limited by listing on the Bombay Stock Exchange and National Stock Exchange of India. Cairn Energy PLC holds 69 percent of shares in Cairn India Limited. For more information, visit
www.cairnindia.com
.
