Project Description

It involves establishment of a collection point and a cold storage having the following facilities:

Fruit Shed
Vegetable Shed
Auction Platform
Market Office
Cold storage having capacity of 1000 Tons
Access Roads
Weigh Bridge
Water Supply & Sewerage facilities

Location
Khuzdar, Balochistan

Land Area
10 Acres contributed by Balochistan Government

Project Cost (approved)
Rs. 35.010 million

Date of Approval
22-09-2004

EDF Approved Funds
Rs. 34.510 million

Management Set-up

A private limited had been formed to implement and operate the project. The Board of Directors consists of the directors from PHDEB, Agriculture Department Balochistan, TDAP and the private sector people. The day to day affairs of the project will be run by the staff to be hired from the market.

Projected Financial Results (Rs.in million)

IFRR = 29%

BEP = 50%

Payback Period = 3.8 Years

Note : These results pertain to cold storage only.

Current Status

Due to delay in start up of implementation because of various reasons, project cost has increased considerably. Therefore, project execution has been split in two(2) phases. First phase is restricted to construction of marketing infrastructure, while second phase will cover construction of cold storage building and installation of machinery and left over civil works.

Tenders for civil works (Phase I) have been received and are under evaluation. Tender Evaluation is being done by the Consultant. It is expected that the contract for the work will be awarded in early December 2007.

For implementation of Phase II , private sector investors are invited to join the Board on mutually agreed terms. One of the option could be lease of land to the potential investor who will build and operate the cold store on commercial basis.

Expected Project Benefits

• Market Price Stabilization : With appropriate market mechanisms and cold stores, the market supplies would be regulated by moving supplies from surplus to deficit areas and also by holding surplus in cold store and releasing when there is short supply. These factors will help create market equilibrium and hence price stability to the advantage of both farmers as well the consumers.

• Increased Commercial Activity : The wholesale market and cold storage facilities would enhance the pace and volumes of business by providing market place for commercial transactions for the domestic and international trade.

• Increased and Extended Product Availability : Reduction of losses and waste of
produce will directly enhance availability. Also, the cold storage facilities would
result in supplies during off-season which otherwise are not possible.

• Employment Opportunities : The development and operation of the proposed physical infrastructure will not only create direct jobs but indirect jobs as well resulting in improved per capita income and ultimately a better living standard.

• Improvement of Quality of Foodstuffs : Timely placement of products inside cold storage will help preserve their quality and improve shelf life. It will also avoid food contamination caused by microbial activity thus assuring improvement of food quality and hygiene.

• Balanced Diet : An appropriate marketing and refrigeration network allows a greater variety of products to be marketed and distributed among population and therefore a balanced diet from a nutrition point of view can be achieved.

• Industrial Development : The availability of wholesale market and cold store will assure that the production will reach the consumer steadily, make investments easier and the private initiative thus inducing development in related industries.