Dunar has presented plans to address the E&S issues and impacts to ensure that the proposed project will upon implementation of the specific agreed measures, comply with the environmental and social requirements including: the host country laws and regulations; IFC’s Performance Standards; and the relevant World Bank Group (WBG)/IFC 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.
PS 1: Social and Environmental Assessment and Management System
IFC’s assessment considered Dunar’s management of its EHS performance in the establishment and operation of its facilities; compliance with national and local permit requirements; and Dunar’s engagement with local communities as well as its suppliers, regarding EHS performance. - Environmental & Social Assessment:
As the Project primarily involves installation of new low-impact equipment and machinery in its existing operations, the environmental and social impacts of the Project will be minimal. Reflecting this, local regulations, did not require a formal Environmental and Social Impact Assessment (ESIA) study of the Project as part of permitting process. Dunar is however, procuring all other necessary permits as per the regulatory requirements.
- Management Systems:
Dunar’s facility in Karnal has implemented management systems certified compliant with ISO 9001-2008 standards for quality; as well as ISO 22000:2005 and HACCP (Hazard Analysis and Critical Control Point) standards for food safety.
Dunar’s new facility in Amritsar is working towards ISO 22000 certification, and plans to achieve it by December 2012.
Dunar has articulated its environmental policy and plans to implement environmental management systems (EMS) ISO 14001 by December 2012. The EMS so developed, will include IFC Performance Standards and relevant EHS Guidelines as one the applicable requirements.
- Organization:
The Company has constituted an Environment Health and Safety (EHS) Management Team at corporate level. Executive Directors (Operations) from each facility are members of this corporate team, and have primary responsibility of managing EHS aspects at each of its facilities. The engineering and production teams at each facility support the Executive Director (Operations) in day to day activities.
Dunar has a full-time Management Representative (MR) at Karnal to oversee the quality and food safety management systems at its facilities. MR reports to the Managing Director and closely works with quality head, facility in-charge, human resources department and the engineering team.
- Supply Chain:
Dunar does not grow its own paddy, but purchases it through the government managed auctions during the harvesting season. Typically, licensed agents, working on behalf of farmers aggregate the paddy from farmers and sell in these auctions. The decision to purchase paddy depends upon the availability, quality and spot market price vis-à-vis the Company’s requirements. It is therefore, not possible to trace the origin of the purchased rice in the supply chain. Dunar therefore has no control on the agricultural practices in the supply chain.
- Monitoring & Reporting:
Dunar regularly monitors the stack emissions and wastewater quality as per the regulatory requirements. Based on the limited information provided by the company, the Company is in compliance with all relevant national regulations.
However, compliance with IFC guidelines for some parameters (such as Total nitrogen, Total phosphorus, Oil and grease, Total coliform bacteria, SOx, NOx), could not be assessed. The Company will therefore develop and implement a comprehensive environmental monitoring program covering all the necessary parameters, and will upgrade pollution mitigation devices if so required to ensure compliance with both regulatory and IFC limits.
Through the Annual Monitoring Reports, Company will regularly report to IFC the outcomes of the monitoring activities.
PS 2: Labor and Working Conditions
Dunar employs around 400 employees in both its facilities, including 40-50 contract workers. Packaging work is outsourced to packaging contractors, who bring in this workforce for stitching and packaging operations. In addition, Dunar employs upto 200 contract workers for paddy unloading during the 4-5 months of harvesting season. Dunar’s HR department ensures contractor’s compliance with requirements of Contract Labor Act.
- Human Resource Policy, Management
The company has a Human Resources (HR) division to manage all HR related activities at each facility. The HR division is responsible for ensuring compliance with relevant labor laws.
While, documented procedures have been developed and practiced, the company is in the process of formalizing them into a comprehensive HR manual, with the help of external HR consultant. Dunar has agreed to include all the IFC’s PS2 requirements as it is revising its HR manual.
- Terms of Employment
Dunar with the help of the HR consultant is developing the Standing Orders as required by the Indian labor laws. The Standing Orders articulate terms and conditions of employment for all the workers and are certified by a competent government officer. Dunar will establish and implement the Standing Orders by September 2011.
- Child Labor
The company has developed and implemented policies and procedures to ensure that no child labor is employed in any manner in its operations. During the visits to Dunar facility there was no evidence of child labor.
Dunar will formalize this requirement for its contractors by including specific clauses on this aspect in the contract documents for all its contractors (notably construction, packaging and transportation), in accordance with a schedule agreed with IFC and documented in the attached Environmental and Social Action Plan (ESAP).
- Freedom of Association:
India’s Trade Union Act facilitates unionization both in the organized, and the unorganized sectors, thereby realizing the freedom of association which is a fundamental right under the Constitution of India. While the Company does not prevent it, there are no labor unions at Dunar facilities.
- Occupational Health and Safety (OHS)
There have been no lost-time incidents recorded at Dunar facilities. The production process is fully closed and automated requiring minimal human interventions. The infrastructure is designed with high safety standards.
The company has in place policies and procedures for ensuring that both workplace hygiene and OHS conditions in facilities meet recognized international standards. These include access control in production areas, provision and use of PPE (caps, masks) in accordance with HACCP requirements and training.
Each facility has a dedicated safety and security manager. The safety officer maintains the accident register, oversees the fire safety and ensures training to all staff on first aid and fire safety.
For the construction phase, while the contractor would be responsible for on-site labor camps if any, Dunar will ensure the adequacy of these provisions – through contract clauses as well as regular supervisions - in accordance with IFC PSs. Necessary construction safety procedures and practices (such as fall prevention barriers, safety signage, color coding of uniforms) shall be implemented at site. Dunar will ensure this through contract clauses as well as on-site supervision.
- On-site Emergency Response Plan:
Dunar has developed a process for Management of Incidents, in order to handle incidents and emergencies and minimize the risk to the staff, workers and product contamination. Incident Management Team (IMT) ensures implementation of this procedure.
Throughout the Dunar facilities, potentially hazardous areas are labeled; and evacuation routes and assembly points designated and clearly marked. Regular fire drills are conducted to ensure the emergency preparedness.
PS3: Pollution Prevention and Abatement
IFC’s assessment considered the Company’s operations with regard to resources consumption (water, energy, fuel), efforts to optimize resource inputs, waste minimization and management practices as well as the storage, handling hazardous materials used in the construction and operations of facilities.
The rice processing at Dunar facilities is a fairly simple operation which generates minimal wastes and emissions. The paddy procured in the market is stored in silos or warehouses. When it is ready for processing, it is transferred to the processing facility by trucks (in sacks) or bulk carriers. After unloading, it is pneumatically transferred to rice mill for processing.
Dunar produces three varieties of rice, and accordingly the processing steps vary:
Raw Rice processing involves drying of paddy, followed by tempering (removing of husk) and milling (cleaning, destining, husking, polishing and whitening) followed by packing. Depending on the extent of polishing, the final product is brown rice or white rice.
Steamed Rice involves a steaming process step, followed by drying, tempering and milling steps as above, prior to final packing.
Parboiled Rice involves steaming step, followed by soaking of rice in water, followed by another steaming cycle. This is then followed by drying, tempering and milling steps as above, prior to final packing
Of the three processes above, only the parboiling process generates process wastewater. Other source of wastewater is cleaning operations.
- Pollution Prevention and Resource Conservation:
Dunar has consciously made efforts for resource conservation and pollution prevention for its facilities and operations:
- The facilities are designed for maximizing the natural light and ventilation in the processing areas.
- Company uses energy efficient lighting fixtures wherever possible.
- The rice processing is fully automated with computerized controls. This helps the Company in accurately controlling the process parameters to optimize the inputs.
- The boilers have condensate recovery system, to reduce the fresh water consumption in boiler.
As a part of the proposed Project, Dunar will build rice-husk based power plant. This will convert the process waste to electrical energy, which will be used in the process.
- Water Supply and Effluent:
The company sources its water from its tube wells at plant locations. Water meters are installed on the wells, to monitor the water consumption. Dunar has its own water treatment unit with reverse osmosis and activated carbon filter, which produces water for boilers and rice processing.
The average daily water consumption for Dunar’s Amritsar facility is approx. 1,400 cu.m, including for steam generation, soaking, and washing/cleaning operation. This facility is equipped with an effluent treatment plant (ETP) including tertiary treatment. The treated effluent is used as boiler feed water for producing steam.
The average daily water consumption for Karnal facility is approx. 1,150 cu.m, which may increase upto 2,350 cu.m/day after the propsed expansion, depending on the quantities of steamed and parboiled rice. The wastewater from Karnal facility is discharged after treatment for irrigation in the nearby fields as per the permission from relevant pollution control authority. Company will ensure that the wastewater treatment plant continues to meet the discharge limits and hence, shall upgrade the ETP as necessary.
- Waste management
Waste lubricants and other potentially hazardous solid wastes are temporarily stored in closed containers and placed in a specially designed area. Dunar disposes of these wastes in licensed facilities as per the conditions in the environmental permit.
The waste generation during the proposed construction of the Project will include excavated materials from civil works site preparation (e.g. soil and rock materials); miscellaneous organic and inorganic domestic waste from food service and offices (e.g. food, paper, and plastics); and construction equipment maintenance wastes (such as waste lubricants, used oil filters). All of these wastes will be managed according to the environmental permit conditions through licensed contractors.
- Energy Sources and GHG Emissions:
Electricity in all plants is obtained from the grid and the rice husk based power plants. The rice husk boilers also meet process steam requirement. Currently diesel generators are used as back-up power souce, and very small quantities are required for boiler start-up.
Once the rice husk-based power plants are operational, Company will stop using diesel generators for back-up. Moreover, the increased power demand after the proposed expansion will be met through the proposed rice-husk based power plants. As such, the power demand from grid will not increase even after the expansion.
The total GHG footprint of the project is thus expected to be around 40,000 t CO2eq/year.
- Air Emissions
The main sources of air emissions are rice husk boilers. Adequate air pollution control equipment for controlling the air emissions from stacks (cyclone separators) have been provided for process emissions control, which meets the relevant regulatory requirements for particulate matter.
Emissions from rice milling process are controlled by bag filters. Dust collected is used for landfilling within Company’s own premises, and the collected paddy husk is used as fuel.
Dunar will regularly monitor the stack emissions for other parameters (such as SOx, NOx) to ensure compliance with local requirements, as well as relevant World Bank Group (WBG) EHS guidelines and take any corrective actions, as needed.
PS4:– Community Health, Safety and Security
The nature of the Company’s operations does not present significant safety and security risks to nearby communities.
Significant impacts likely to occur relate to the movement of vehicles on the approach road to Dunar facilities for raw materials and finished product.
The peak vehicular movement (upto 100 trucks/day) happens during the 3 months of harvesting season, when the paddy is sourced for the entire year. However, since Dunar’s facilities are located in the outskirts of the cities in the agricultural areas, there are no communities in the immediate vicinity of 2-3 km. Hence, the impact of vehicular movement on surrounding communities is expected to be minimal.
While the impacts on the nearby communities due to Dunar operations are limited, Dunar has developed emergency response plans for its respective operations.
The Company contracts with a nationally certified security agency, with unarmed security guards during the day. Only one armed security guard (former serviceman) is deployed in the night. Dunar will review relevant IFC requirements with regard to use of force, and train its security guards accordingly.
On the basis of the above information, it is concluded that the Project has been designed and will be operated in compliance with IFC’s PS and relevant environmental, health and safety guidelines.
