The company has presented plans to address these impacts to ensure that the proposed project will upon implementation of the specific agreed measures, comply with the host country laws and regulations and the World Bank/IFC environment and social policies and the environmental, health and safety guidelines. The information about how these potential impacts will be addressed by the company is summarized in the paragraphs that follow.
The summary has been organized in two parts. The first part addresses aspects that apply generally across all of LGB’s facilities, while the second provides relevant details and opportunities for improvement for each specific facility.
- Corporate environmental, social, and health and safety management systems:
The company is in the process of deploying certified management systems based on Total Productive Maintenance (TPM), ISO 9000, ISO 14001 and OHSAS 18000 standards. These systems have presently been implemented in the Chains division and are proposed to be rolled out company wide by December 2006. The company has, under its management system, articulated Vision, Mission and Values, all of which focus on the company’s stakeholders. Within a timeframe to be agreed with IFC, the company will, undertake an ergonomics study across all of its facilities and develop an action plan, acceptable to IFC, based on the outcome of the ergonomic study. The company will at all times ensure that design, rehabilitation, operation and decommissioning of existing and new facilities meets host country requirements and WBG policies and guidelines.
- Air emissions, ambient and workplace air quality:
The principal point sources of air emissions at all of LGB’s facilities are the diesel generator (DG) sets and furnaces. The company has commenced providing acoustic enclosures for DG sets and will, within a timeframe to be agreed with IFC, provide acoustic enclosures for all DG sets at all of its facilities. The company undertakes quarterly monitoring of air emissions and will ensure that these comply with host country and WBG requirements. Fugitive emission is generated from furnaces (door leakages), hot forging operations, quenching operation and turpentine washing. While fume extractors have been provided at all facilities, these and the ventilation system both need to be upgraded. Further, the company will undertake quarterly monitoring of workplace and ambient air quality to ensure that this remain within host country and WBG norms. Refrigerant used in chillers/air conditioning system and fire extinguishers will comply with the Ozone Depleting Substances Rules set by the GOI under Montreal Protocol requirements.
Water for process and drinking:
Process and drinking water requirement at all the facilities is met from groundwater withdrawals. The company will, within a timeframe to be agreed with IFC, install rainwater harvesting facilities at all of its plants. The company provides treated water (industrial scale water purifiers with UV and activated carbon filter treatment) for drinking purposes at all its plants and will ensure that it meets international standards for potability.
Reuse/disposal of treated effluent (process and domestic) and, management of effluent treatment plant (ETP) and sewage treatment plant (STP) sludge:
Treated effluent (both process and domestic) is used at all premises for irrigation. The company will, within a timeframe to be agreed with IFC, have the ETP sludge at all facilities characterized to establish whether or not it is a regulated hazardous waste and, if so, develop an appropriate program for its disposal. The company will undertake benchmark testing of treated effluent to ascertain presence of coliforms or other micro-organisms and, if necessary, will disinfect the treated effluent prior to use in irrigation. The company has the STP sludge vermi-composted and uses it as manure at all premises.
Management of hazardous materials:
The company uses a number of regulated hazardous materials including cutting and cooling oils, lubricants and turpentine. The company will ensure that, appropriate facilities with secondary containment are constructed to store all such materials at all plants. The company will make personal protective equipment (PPE) available to workers handling hazardous materials, enforce the use of PPE, provide training to employees handling hazardous materials, and provide washing stations in material handling areas. Further, the company will ensure that relevant material safety data sheets are posted at appropriate locations and necessary antidotes for accidental exposure are available and readily accessible. The company has initiated a program to phase out use of turpentine and replace it with bio-cleaners. The company will expand the program to include all facilities where turpentine is used. LPG is used at several facilities (detailed hereunder). The LPG bullets are managed by Elf and adequate fire and safety provisions have been provided. Fuel for the standby diesel generators is stored in underground storage tanks (details provided hereunder). The company will, within a timeframe to be agreed with IFC, develop and implement a program for integrity testing of underground diesel storage tank.
Management of hazardous and other wastes:
The company generates hazardous wastes at all of its facilities. Within a timeframe to be agreed with IFC, the company will implement a program to ensure that hazardous wastes generated at each of the facilities are identified; all facilities have appropriate authorization under the Hazardous Waste Management and Handling (HWMH) Rules as amended up to 2003; a process is in place for segregation of hazardous and other wastes at source; appropriate facilities with secondary containment are constructed for storage of hazardous wastes; and wastes are disposed of only through authorized entities, in accordance with HWMH Rules. The company is implementing a program to package materials for OEM (bulk packing) in returnable containers and to replace thermocol packaging with paper board packaging. The company will expand this program to include all components, where this may be relevant and feasible.
Occupational Health and Safety:
Occupational health and safety aspects need to be improved at all of the facilities, particularly the use of PPE. For example, although noise level in all of the plants is high, use of hearing protection is not regularly enforced. The company will implement measures to reduce noise at source, monitor noise levels in the work area and enforce use of ear protection. The company will, within a timeframe to be agreed with IFC, undertake benchmark hearing tests of employees exposed to high levels of noise. Use of other PPE (gloves and shoes) also needs improvement. The company will quarantine electrical panels at all plant locations. While fire extinguishers have been provided, fire safety and emergency response plans need to be displayed, and signage needs to be improved. Assembly point will be designated at all locations. While safety signage has been provided, these are in English. The company will display safety signage in the local language, with appropriate illustrations. Employees and contract labor at all facilities undergo safety training and mock drills are conducted. The company will, at all facilities, constitute a safety committee comprised of management and worker representatives to conduct periodic health and safety audits and identify areas where improvements are needed. General housekeeping and upkeep of plant premises can be further improved. Although machines have been installed with drip trays around them, there is still some amount of oil spillage on floors. The flooring is mostly tiled/smooth finish. The company will, progressively, replace existing flooring with anti-slip/mat surfaces.
Details of relevance to specific plants are presented below-
Annur Timing Chain Plant, commissioned in 1989:
The facility is certified to ISO 14001 standards and has a TPM process in place. The primary source of energy is grid electricity, supplemented by 2 x 380 KVA and 1 x 270 KVA standby DG sets. Furnaces are LPG fired. There is a 16 KL underground diesel storage tank and 2 x 5 t LPG bullets. By May 2006, the company will provide acoustic enclosures to the DG sets. The facility’s 25 m3/day water requirement is met from a combination of groundwater extraction and municipal sources. The plant has installed rainwater harvesting facilities to recharge the groundwater. The plant generates 13 m3/day of process and 4 m3/day of domestic effluent, which are treated in an effluent treatment plant (ETP) and sewage treatment plant (STP) respectively. Hazardous wastes at this facility are appropriately segregated at source (there is a color coded bin process for waste disposal on shop floor) and stored in a scrap yard in designated areas fitted with secondary containment. The company will upgrade the secondary containment for storage of hazardous wastes by providing a ramp (instead of an opening in the dyke wall) for placement/removal of hazardous waste in/from the designated storage areas.
Vaiyam Palayam Drive Chain Plant, commissioned in 1993:
The facility will be certified to ISO 14001 standards by December 2006 and has a TPM process in place. The primary source of energy is grid electricity supplemented by 4 x 380 KVA standby DG sets. Furnaces are LPG fired. There is a 15 KL underground diesel storage tank and 1 x 10 t LPG bullet. One of the DG sets has an acoustic enclosure and the company will, by June 2006 install acoustic enclosures on the other three DG sets. The company is installing a fume extraction system (quenching operations and furnace door leakages) that will be completed by February 2006. The facility’s 25m3/day water requirement, is met through groundwater extraction. The plant generates 5m3/day of process effluent, which is treated in an effluent treatment plant, and domestic effluent, which is treated in a STP. While a fraction of the treated effluent is re-circulated, the balance is used on premises for irrigation. ETP sludge has been categorized as hazardous and is presently being bagged and stored on premises. The company will implement a program for disposal of the ETP sludge in a secured landfill, within a timeframe to be agreed with IFC. Emergency exit signage at the facility is well displayed and the same may be used as a benchmark for the other facilities as well.
Pongalur Fine Blanking Plant, commissioned in October 2005:
The facility was acquired from Laxmi Machine Works and was formerly a Wind Energy Generator assembly unit. It will be certified to ISO 14001 standards by December 2006 and has a TPM process in place. The company has applied for a “Consent to Operate” for the facility from Tamil Nadu Pollution Control Board. Fine blanking machines including the R&D and machine building operations currently located in the plant at the Coimbatore (where the Corporate Office is also located) are proposed to be shifted to this location. The facility is currently under trial production and is expected to commence commercial production by March 2006. All machining and finishing work is outsourced on a piece rate contract. While most of the sub contractors earn 20-30% of their revenues from LGB, several sub contractors earn nearly 70% of their revenues from LGB. Within a timeframe to be agreed with IFC, the company will, implement a program to encourage the sub contractors to adopt manufacturing practices consistent with LGB’s ISO 14001 and OHSAS 18000 systems. The primary source of energy is grid electricity and 1 x 380 KVA standby DG set with integral acoustic enclosure is proposed to be installed by May 2006.
The company will construct an over-ground fuel storage tank with appropriate secondary containment. The facility’s, 8m3/day water requirement is met wholly from groundwater extraction. No process effluent is expected to be generated hence no ETP is proposed at the facility. Management of hazardous materials needs to be significantly improved. The Company will, by March 2006, dispose of the accumulated hazardous waste (from past operations at site), in accordance with HWMH Rules. The company generates oil containing waste like burrs, grinding waste and metal wool, which are presently being disposed of to foundries. The company will ascertain whether these hazardous wastes can be disposed of to foundries as per HWMH rules. If not, the company will implement a program to dispose these hazardous wastes in accordance with HWMH rules, within a timeframe to be agreed with IFC.
KPalayam Cold Forging Division, commissioned in August 2005:
The facility will be certified to ISO 14001 and OHSAS 18000 standards by December 2006. This is a new facility with construction for two bays underway. The land (13 acres) was acquired in November 2004 from one farmer and the price paid was Indian Rupees One hundred thousand per acre, which is above the one year average price/acre of all land transactions (preceding acquisition of the land by LGB) in the vicinity of the plant. The land use prior to acquisition was agriculture and no physical resettlement was necessitated. The facility will have a phosphating line as well, which is proposed to be commissioned in February 2006. No labor camp for construction workers is necessary as local labor is being used. The company will ensure that relevant and appropriate community and occupational health and safety provisions (working at height/safety harness, provision and use of PPE including safety shoes, gloves, helmets, welding masks/goggles, provision of basic amenities to workers, minimization/reuse/disposal of solid waste generated, fugitive dust suppression, shoring of pits, safety of scaffoldings, safe and defensive driving in transport of material/waste/equipment etc.) are embedded in construction, fabrication and erection contracts.
The company will ensure that the construction contractors comply with these requirements. The primary source of energy is grid electricity and 1 x 60 KVA standby DG set with integral acoustic enclosure is proposed to be installed by May 2006. The company will construct an over-ground fuel storage tank with appropriate secondary containment. The facility’s, 10m3/day water requirement, will be met through groundwater extraction only. 10 m3/day of process effluent is expected to be generated and an appropriate ETP is under construction, which is likely to be completed by March 2006. The company will ensure that the phosphating line is commissioned only after commissioning and stabilization of the ETP. A STP shall be constructed for treatment of domestic effluent.
Mysore Automotive Drive Chain Plant commissioned in 1980:
The facility is certified to ISO 14001 and OHSAS 18000 standards and has a TPM process in place. Relevant and applicable ISO 14001 standard operating procedures (SOPs) and emergency response teams, for each department, are displayed in the local language at various locations in the plant. Further, Standing Orders and Factories Act have been translated and displayed in the plant. The primary source of energy is grid electricity and 1 x 380 KVA standby DG set with acoustic enclosure is provided. Furnaces are LPG fired. There is no fuel storage tank but there are 2 x 5 t LPG bullets. The Company has provided acoustic enclosures to two of the three stamping machines, which generate high levels of noise. The company will provide acoustic enclosure on the third stamping machine by May 2006. Online gas sensors with alarm have been provided in the furnace/heat treatment area of the plant. The facility’s, 10m3/day water requirement, is met through groundwater extraction and partly from municipal sources. No process effluent is generated in the plant, only domestic effluent is generated, which is treated in a sewage treatment plant. The treated effluent is used for irrigation on premises. The facility generates several hazardous and other wastes. These are appropriately segregated at sources (there is a color coded bin process for waste disposal on shop floor) and stored in a scrap yard in duly earmarked areas with secondary containment. The roofing and side cladding at the facility is made up of asbestos cement (AC) sheets but the company proposes to appropriately paint the AC sheets so as to prevent friable fiber release in the work area. Noise level is high but employees use ear defenders. Fire evacuation plan is displayed, emergency exit and assembly points marked. Safety signage and housekeeping can be improved further, particularly storage and movement of semi-finished products, oils, lubricants on the shop floor.
P’Palayam Hot and Warm Forging Greenfield Plant proposed to be commissioned by April 2007. The company proposes to setup a green-field hot and warm forging facility at P’Palayam. The company will design, construct, operate and decommission the facility in accordance with applicable WBG policies including: Operational Policy (OP) 4.01 Environmental Assessment dated October 1998; IFC Policy Statement on Forced Labor and Harmful Child Labor, dated March 1998; Guidance to Local Sponsors on Local Disclosure of the Environmental Review Summary (ERS); and guidelines including: World Bank Group General Environmental Guidelines dated July 1998; IFC Guidelines for Occupational Health And Safety dated June, 2003; and IFC Guidelines on Hazardous Materials Management dated December 2001. The company will obtain all host country regulatory approvals from the Tamil Nadu Pollution Control Board and make copies of the same available to IFC. The facility will be certified to ISO 14001 standards by October 2007. The primary source of energy will be grid electricity, supplemented by 2 x 500 KVA standby DG sets. Furnaces will be electrically heated. The facility will have a 15 KL over ground diesel storage tank. The DG sets will have integral acoustic enclosures. The facility’s 5 m3/day water requirement is proposed to be met from groundwater extraction. The plant will install rainwater harvesting to recharge the groundwater. The plant will generate only domestic effluent, which will be treated through sewage treatment plant (STP). Hazardous materials, hazardous and other wastes at this facility will be appropriately segregated and stored in a material storage/scrap yard in designated areas fitted with secondary containment and disposed as per host country requirements. The company has acquired 45 acres of land from 8 number of small farmers. The land acquisition, as confirmed by the company, did not involve any physical resettlement. To document compliance with World Bank Group (WBG) policy Operational Directive (OD) 4.30 (Involuntary Resettlement), the company has agreed to provide to IFC, a written report that describes in detail the acquisition process, consultations undertaken, number of people affected, and outcomes achieved. Submission of a report satisfactory to IFC will be made a condition of first disbursement of the loan. The company has reviewed OD 4.30 and the WBG Operational Policy note (OPN) 11.03 (Management of Cultural Property in Bank Financed Projects). In case of the current and any future land acquisition, the company will ensure full compliance with these policies.
Mysore Hot and Warm Forging Plant commissioned in 1978:
The facility has been acquired from MGM forgings limited. The facility started as a tool room in 1978 and the forge shop was commissioned in 1981. The facility is certified to ISO 9000 and expects TS 16949 certification by March 2006. The company proposes to obtain ISO 14001 and OHSAS 18000 certification for the facility by December 2006. The primary source of energy is grid electricity and 1 x 380 KVA standby DG set is provided. Furnaces are LDO fired except two electrical furnaces. There is a 45 KL underground LDO storage tank. The company will, within a timeframe to be agreed with IFC, shift from LDO to LPG as primary fuel for furnaces. Quenching and drinking water requirements are met from groundwater extraction. There are no process effluents generated and domestic effluent is disposed through septic tank and soak pit. The environmental and occupational health and safety status of the facility needs to be improved significantly. The Company will, within a timeframe to be agreed with IFC, undertake a third party environment, occupational health, safety, life and fire safety audit and will on a priority basis, develop an action plan, which will include the following:
- benchmark testing of stack emissions to demonstrate compliance with WBG requirements and where required, develop an action plan to comply with WBG emission norms;
- benchmark monitoring of work area environment quality to demonstrate compliance with WBG requirements and an action plan to comply with WBG requirements. In the interim, the company will install a fume extraction and dust suppression system at all relevant locations;
- a material (cold, hot and reject) flow and storage plan acceptable to IFC;
- a noise and vibration analysis and a management plan;
- an occupational health and safety hazard analysis and an action plan for management of occupational hazards. In the interim, the company will make available all relevant PPE, ensure their usage and construct screens/provide protection for press operators;
- an action plan to manage heat stress and in the interim, the company will improve ventilation, install blowers and provide additional drinking water point in the work area;
- an action plan for management of hazardous materials;
- an action plan for management of hazardous and other wastes, and scrap;
- an action plan for repair of floors;
- an action plan for minimization and management of spills, scrap and forging wastes;
- an action plan to prevent, detect and control fire incidents;
- benchmark testing of drinking water to demonstrate compliance with IS/WHO standards; and
- a management plan to improve the overall housekeeping in the facility
Subsequent to development of the action plan based on the third party environment, occupational health, safety, life and fire safety audit, the company will provide to IFC, a quarterly progress report on status of implementation of the action items included in the action plan.
Bangalore Apten Warm and Hot Forgings Plant, commissioned in 1982:
The facility was acquired by LGB in June 2004 and is certified to ISO 9001 and TS 16949. The facility will be certified to ISO 14001 and OHSAS 18000 standards by December 2006. Raw rod stripping, component normalizing and phosphating operations are outsourced. The company will, within a timeframe to be agreed with IFC, develop and implement a plan to encourage their sub contractors to adopt operational practices consistent with LGB’s operational standards. The primary source of energy is grid electricity and 1 x 725 and 1 x 500 KVA standby DG sets are provided. The company will provide acoustic enclosure for DG sets by May 2006. Furnaces are LPG fired. LPG cylinders and nitrogen cylinders are presently stored on the shop floor but a facility for their storage is under construction. The facility’s, 5m3/day water requirement, is met through groundwater extraction. The company provides bottled water for drinking purposes. No process effluent is generated in the plant, only domestic effluent is generated, which is discharged through the septic tank and soak pit route. There is opportunity for improving housekeeping further, particularly storage and movement of raw material, semi-finished products, oils and lubricants on the shop floor.
Corporate social responsibility efforts, including HIV/AIDS awareness:
In consultation with communities in the vicinity of the companies facilities, the company will undertake corporate social responsibility initiatives. IFC will provide details of its IFC Against AIDS program to the company for distribution to its employees, contractors and among nearby communities, in a culturally appropriate manner.
Timely reporting on environmental and social performance to IFC:
The company will, in a format to be agreed with IFC, submit Annual Environmental and Social Monitoring Reports (AMRs) timely within 90 days of the end of its financial year. In case of Mysore Hot and Warm Forging Facility, the company will submit a quarterly progress report on status of implementation of the action plan based on outcome of the environmental, social, occupational health and safety audit.
