The World Bank Sindh Livestock And Aquaculture Sectors Transformation Project (P179003) Appraisal Environmental and Social Review Summary Appraisal Stage (ESRS Appraisal Stage) Public Disclosure Date Prepared/Updated: 03/30/2024 | Report No: ESRSA03403 Feb 07, 2025 Page 1 of 9 The World Bank Sindh Livestock And Aquaculture Sectors Transformation Project (P179003) I. BASIC INFORMATION A. Basic Operation Data Operation ID Product Operation Acronym Approval Fiscal Year P179003 Investment Project Financing (IPF) LIVAQUA 2024 Operation Name Sindh Livestock and Aquaculture Sectors Transformation Project Country/Region Code Beneficiary country/countries Region Practice Area (Lead) (borrower, recipient) Pakistan Pakistan SOUTH ASIA Agriculture and Food Borrower(s) Implementing Agency(ies) Estimated Appraisal Date Estimated Board Date Islamic Republic of Livestock and Fisheries Department, 20-Feb-2024 20-Jun-2024 Pakistan Sindh Province Estimated Decision Total Project Cost Review Date Public Disclosure 15-Feb-2024 147,000,000.00 Proposed Development Objective To promote climate-smart and competitive small and medium producers in the livestock and aquaculture sectors in Sindh. B. Is the operation being prepared in a Situation of Urgent Need of Assistance or Capacity Constraints, as per Bank IPF Policy, para. 12? No C. Summary Description of Proposed Project Activities The first component 'Strengthening the Enabling Environment for Sectoral Growth' aims to support the development of inclusive, climate-resilient, and sustainable livestock and aquaculture sectors by: (i) improving sector policy and strategic frameworks, as well as evidence-based decision making; and (ii) strengthening the provision of essential knowledge, inputs, and services. Sub-Component 1.1 'Improvement of Sector Policies, Strategies, and Evidence-based Decision Making' will finance goods and services for: (i) the formulation, adoption, and monitoring of policy and strategic frameworks to notably strengthen the veterinary and aquaculture development frameworks and animal disease control, improve the genetics and breeding strategy, promote fish quality and value-addition, and strengthen food safety; (ii) the Feb 07, 2025 Page 2 of 9 The World Bank Sindh Livestock And Aquaculture Sectors Transformation Project (P179003) preparation and response to animal health and climate related emergencies; and (iii) capacity building of institutions in the livestock and aquaculture sectors to collect, centralize, and analyze sector-wide data. Sub-Component 1.2 'Strengthening the Delivery of Essential Knowledge, Inputs, and Services' will support public and private institutions providing key public good knowledge, inputs, and services to livestock and aquaculture producers, such as: (i) disease control services; (ii) diagnostic laboratory services; (iii) vaccines production; (iv) food safety services; (v) breeding and genetic improvement services; (vi) research, development, and transfer of green technologies. The second component ' Promotion of Climate-Smart Production, Value Addition, and Inclusive Access to Markets' will support growth-oriented small and medium producers establish/upgrade their market linkages with off-takers in a market-driven, profitable, and sustainable way and intensify and add value to their production. The Project will do so by: (i) facilitating the formation of producer groups (PG) and productive alliances (PA) and the preparation of their business plans (BPs); and (ii) competitively selecting and financing the most commercially viable, inclusive, and climate-smart BPs. Subcomponent 2.1 'Capacity Building and Development of Horizontal and Vertical Alliances' will finance goods and services for the formation of PGs, the establishment of PAs, and the formulation of BPs. Subcomponent 2.2 ' Improving the Market Integration of PGs for Increased Climate-Smart Production and Value Addition' will finance matching grants, goods, and services to competitively select PA BPs and support their implementation by allowing PGs to invest in technical assistance, productive assets, and inputs. D. Environmental and Social Overview D.1 Overview of Environmental and Social Project Settings D.1 Overview of Environmental and Social Project Settings [Description of key features relevant to the operation’s environmental and social risks and opportunities (e.g., whether Public Disclosure the project is nationwide or regional in scope, urban/rural, in an FCV context, presence of Indigenous Peoples or other minorities, involves associated facilities, high-biodiversity settings, etc.) – Max. character limit 10,000] The project will be implemented in the Sindh province of Pakistan, a region severely impacted by the 2022 floods. The floods resulted in the displacement of an estimated 33 million people, caused extensive damage to over 8300 kilometers of road, and destroyed approximately 1.27 million homes. The floods also devastated large portions of productive agricultural land, resulting in the loss of nearly 800,000 livestock across the province, causing critical impacts on rural livelihoods. Sindh’s vulnerability to various natural disasters such as droughts, heatwaves, cyclones, and earthquakes, is heightened due to its position along the lower riparian area of the Indus delta, socioeconomic instability, and extreme climatic conditions. Summer temperatures in the province are among the highest in the country, with historically recorded temperatures exceeding 50 degrees celsius in a number of instances. These high temperatures, combined with climatic variability and socioeconomic challenges pose significant risks to human health, agricultural productivity, and food security. Resultingly, undernourishment and stunting are significant in the province, with around 34% of children under five classified and undernourished, and 45.5% stunted. This exceeds the national average which is 20% and 40% respectively. The province’s landscape includes a coastline, numerous wetlands including Ramsar sites, and a significant portion of the Indus River. Agriculture, including livestock and aquaculture, plays a vital role in the provincial economy, and is also a key dimension of nutrition in the province. Agriculture contributes to 24% of the provincial GDP, and around 70% of employment. D.2 Overview of Borrower’s Institutional Capacity for Managing Environmental and Social Risks and Impacts The Sindh Livestock and Fisheries Department (L&FD) will lead the implementation of the proposed project. The L&FD has prior experience on the World Bank Funded Sindh Agricultural Growth Project (SAGP, P128307) which concluded in Feb 07, 2025 Page 3 of 9 The World Bank Sindh Livestock And Aquaculture Sectors Transformation Project (P179003) June 2019—the SAGP project received a satisfactory rating upon completion. Currently however, the L&FD does not have dedicated staff or resources to manage environmental and social risks associated with the proposed project. Additionally, LIVAQUA is being implemented under the ESF, which L&FD does not have experience with, and will require detailed orientation and training. Therefore, the borrower capacity is considered to be low to moderate at the appraisal stage. A Project Coordination Unit (PCU) will be established at the L&FD which will have the overall responsibility of coordinating all aspects of the project. Additionally, a PIU will be established at the L&FD. The PIU will be led by a Project Director, and two Deputy Project Directors, (Agriculture and Livestock Administrative). The PIU at the Project Director level will have dedicated Senior Safeguards Specialist and Gender Specialist (two positions) while under each Deputy Director at the PIU will be an additional two positions, namely, Environment Specialist, and Social Specialist as agreed in Environment and Social Commitment Plan (ESCP) to supervise the implementation of the Projects E&S policies and procedures. II. SUMMARY OF ENVIRONMENTAL AND SOCIAL (ES) RISKS AND IMPACTS A. Environmental and Social Risk Classification (ESRC) Substantial A.1 Environmental Risk Rating Substantial Overall, the project will have positive environmental benefits through the introduction of sustainable and climate smart practices in livestock and aquaculture production, resulting in reduction of GHG emissions. The environmental risks include soil erosion due to overgrazing (which itself may be a result of increased participation in the livestock Public Disclosure sector) which can lead to loss of fertile land and increased sedimentation in water bodies. Increased intensity in livestock and aquaculture may also lead to excessive use of agrochemicals such as pesticides, which pose significant threats to land and water quality, and aquatic ecosystems. Increased livestock waste may also detrimentally affect aquatic ecosystems, and increase resource pressure on local communities, especially for water resources. The risk of invasive species also remains relevant, as existing aquaculture operations supported by the Project often cultivate non-endemic species without clear controls for preventing their introduction into natural habitats. The aquaculture activties in natural habitats (some of which may be protected areas and Ramsar sites) pose threat to waste water pollution, eutrophication and threat to aquatic native species. Construction activities may result in increased local dust and emissions, particularly due to vehicles and other machinery used. These activities may also cause significant noise pollution, which may pose disturbances to local communities and wildlife. As the project will involve the procurement, provision, and administration of pesticides, veterinary medicines, and vaccines, and other sector specific inputs, there are significant risks around the safe handling, storage, and disposal of these materials, especially given their potential to harm both environmental and human health. Moderate A.2 Social Risk Rating The social risk rating remains unchanged from concept stage, and is assessed to be moderate. Positive livelihood impacts are associated with improved breeds, disease control, and enhanced knowledge of producers on livestock and aquaculture management. Social risks encompass issues such as community health and safety, particularly with regard to improper use of aquaculture and livestock inputs such as pesticides, medicines, and vaccines. Use of child labor/family labor is a risk since it is common in rural Sindh to involve children in livestock and aquaculture management. The risk of elite capture is relevant to Components 1 and 2, including the possibility that women, Feb 07, 2025 Page 4 of 9 The World Bank Sindh Livestock And Aquaculture Sectors Transformation Project (P179003) vulnerable groups, and historically underserved communities might be excluded from the activities under these components. The risks of elite capture can be compounded by the actions of large or influential farmers, and biases in preliminary surveys used to identify target villages, PG members, buyers, and market enablers. B. Environment and Social Standards (ESS) that Apply to the Activities Being Considered B.1 Relevance of Environmental and Social Standards ESS1 - Assessment and Management of Environmental and Social Risks and Impacts Relevant ESS1 is relevant. The environmental risks for the project encompass a range of potential adverse impacts. Technical design flaws in construction and rehabilitation activities could expose workers to toxic substances and equipment malfunctions, with natural disasters posing additional threats. The procurement of low-quality pesticides and vaccines and accidental releases could harm humans, livestock and the environment. Soil erosion and contamination may result from project activities, while waste generation from construction and healthcare could contaminate surrounding areas if not managed properly. There are concerns about healthcare waste disposal, electronic waste and ambient air quality degradation due to emissions from project activities. Noise pollution from construction machinery and activities may affect local communities and wildlife. Additionally, solarization of facilities carries risks of visual impacts, structural damage, and waste. Ecological and biodiversity risks include the clearing of vegetation, introduction of exotic species, hunting and poaching of wildlife, the use of lethal drugs and pesticides, disease transmission from livestock to wildlife, and introduction of alien invasive fish species. These activities may also negatively impact water and land resources, potentially leading to issues like eutrophication and soil salinity. The Public Disclosure social risks associated with the project include occupational health and safety hazards, community health and safety concerns, and security issues, particularly in remote or conflict-prone areas. Gender-based violence, including sexual exploitation and abuse, along with risks of forced and child labor are also substantial concerns, particularly in rural settings. Social exclusion and elite capture could potentially marginalize women, vulnerable groups and historically underserved communities from project benefits. Additionally, the project poses a risk of insufficient community engagement, which could limit stakeholder feedback and prevent communities from fully benefiting from the project. There are also risks related to the discovery of important physical and cultural resources during construction. Exclusion risks to women are significant due to cultural constraints limiting their business leadership roles and participation in farming-related decision-making. Land acquisition may displace informal settlers and require resettlement, and establishing milk collection centers involves community-donated land. Cold chain management for vaccine efficacy is crucial to prevent disease outbreak and economic losses among livestock, with additional concerns over disease spread and environmental pollution from fish farming. To mitigate the E & S risks, a framework approach has been adopted, with the understanding that subproject details will be identified during implementation. An Environmental and Social Management Framework (ESMF) has been prepared by the client for the overall project. The ESMF provides guidance on screening and determining E&S risks of each project subcomponent, criteria for the preparation of site specific Environmental and Social Management Plans (ESMPs), institutional monitoring and reporting arrangements, and institutional implementation arrangements and staffing requirements. ESS10 - Stakeholder Engagement and Information Disclosure Relevant The L&FD has prepared a Stakeholder Engagement Plan to provide a framework for consistent and inclusive engagement with stakeholders throughout the Project lifecycle. The SEP ensures that appropriate Project related Feb 07, 2025 Page 5 of 9 The World Bank Sindh Livestock And Aquaculture Sectors Transformation Project (P179003) information (including information on risks and impacts) is disclosed to stakeholders in a timely, understandable, and accessible manner. It describes all stakeholder parties, including Affected Parties (APs), Other Interested Parties (OIPs) and vulnerable groups, and provides guidance for Project implementers on how to meaningfully engage with these groups through the Project lifecycle. The SEP also includes a grievance redress mechanism (GRM) to receive and facilitate the resolution of concerns and grievances including SEA/SH incidents. The SEP will be disclosed at appraisal stage. The guidance provided in the SEP is especially relevant to the implementation of awareness raising, mass communication campaigns, and trainings for small and medium farmers and farming communities. ESS2 - Labor and Working Conditions Relevant The Project is expected to involve direct workers (including staff of the PCMU and PIU, private veterinarians and aquaculture practitioners, and technicians employed at milk collection centers), government workers (existing government staff from the Livestock and Inland Fisheries Directorates, and Livestock Extension services), contracted workers (project implementation consultants, capacity building firm, M&E consultants, D&S firm, workers hired by contractors for construction work, workers contracted to implement communications and mass awareness campaigns) and primary supply workers (employees of companies from which the Project will procure goods and services including veterinary drugs, laboratory equipment, aquaculture inputs, etc). The primary labors risks are related to OHS and may arise during small scale construction and rehabilitation activities. These risks include personal injury due to construction activities, chemical exposure (fertilizers, pesticides), exposure to zoonotic diseases, inappropriate storage, handling, and disposal of hazardous materials, risk of drowning in fishponds, and exposure to water-borne diseases. Labor involved in construction activities may be additionally at risk of extreme heat exposure when working during the summer months. Child labor/family labor is common in rural Sindh whereby the younger Public Disclosure family members are involved in livestock and aquaculture management. Provisions will be made in the LMP as per Government of Sindh law on child labor, whereby children aged 14 can be employed in non-hazardous work (as defined in The Sindh Prohibition of Employment of Children Act, 2017). Also, specifically for aquaculture, exploitation of labor in the shape of lower wages, poor working conditions and lack of documentation, is a risk. This has also been highlighted in the LMP with appropriate mitigation measures. All such categories have been explained in the LMP and mitigation measures suggested. Risks related to labor influx, forced labor and child labor are low to moderate. The L&FD has prepared a Labor Management Procedures (LMP) which contains detailed guidance on employment terms, labor risks and mitigations, and other information related to labor and working conditions. The LMP also describes a dedicated workers’ Grievance Redress Mechanism which will be housed in the PCMU and sub-PMUs. Through the LMP, construction contractors are required to prepare site-specific OHS management plans—guidance for the preparation of the OHS management plans is provided in the LMP. This LMP will be implemented across the project life. ESS3 - Resource Efficiency and Pollution Prevention and Management Relevant ESS3 is relevant. The Project will involve the procurement of livestock vaccines and syringes for administering these vaccines, which carries the risk of generating hazardous waste which requires careful storage, handling, and disposal. There will also be non-negligible quantities of waste and effluent generated from livestock and aquaculture activities which can potentially contaminate soil and nearby water resources. An increase in the intensity of livestock and aquaculture activities resulting from the support provided by the project may also lead to soil degradation, erosion, and nutrient depletion. Air pollution risks are also relevant—these may be restricted to subproject sites in the case of construction activities, or may be more widely distributed when considering increased intensity of livestock farming Feb 07, 2025 Page 6 of 9 The World Bank Sindh Livestock And Aquaculture Sectors Transformation Project (P179003) which can lead to increased emissions of methane and other greenhouse gases. Finally, there is a risk of improper management of on-farm and construction waste which could negatively impact surrounding ecosystems, and pose risk to human health and safety. Finally, an increase in the intensity of aquaculture can lead to increased use of pesticides which are typically used for pest control in aquaculture activities. Improper use of these pesticides could potentially compromise surrounding ecosystems and wter resources if not managed properly. The ESMF which has been prepared includes measures to mitigate risks associated with resource efficiency and pollution. Specifically, the L&FD will prepare a Healthcare Waste Management Plan (HWMP) prior to initiation of project activities. The HWMP will be in line with the provisions of the Sindh Hospital Waste Management Rules 2014. Appropriate site/activity specific measures have also been included in the E&S screening checklist accompanying the ESMF, and contractors will be required to address these in their site-specific ESMPs. Site specific Pest Management Plans (PMPs) will also be prepared prior to initiation of any aquaculture activities under the project. ESS4 - Community Health and Safety Relevant ESS4 is relevant. The Project will involve use of pesticides, vaccines, and other veterinary and aquaculture medical supplies. Improper usage of these materials and disposal of medical waste (such as vaccines, syringes) and livestock/aquaculture inputs (pesticides) may put communities at risk of exposure. The risk of zoonotic disease spread is also relevant given the nature of the project. Other CHS risks are associated with localised construction and facility rehabilitation activities which may include health issues related to exposure to air and noise pollution, inappropriate disposal of solid waste generated at labor camps, and risks related to increased traffic of heavy machinery and construction vehicles. But these are low to moderate and site specific. The Project ESMF contains an assessment of the specific risks and impacts to communities arising from project activities, and includes necessary mitigation Public Disclosure measures. Site specific OHS risks will be managed through the development of ESMPs during project implementation. Additionally, the Project will develop a standalone GBV/SEA/SH Assessment and Action Plan to assess in detail and manage the risks related to GBV/SEA/SH within 60 days of project effectiveness. ESS5 - Land Acquisition, Restrictions on Land Use and Involuntary Resettlement Relevant This standard is relevant as Voluntary land donation (VLD) may be required for the establishment of milk collection centers (approximately 300 centers will be built of 500 – 1000 square feet each), however these will have a relatively small footprint. Other than that, at appraisal stage, no land acquisition or involuntary resettlement is expected from the project. The project will make efforts to prioritize the use of government owned/public lands for any activities that have land requirements. VLD will only be considered in instances where no suitable public land is available. The Project will prepare a Resettlement Framework (RF) which will describe the procedure for mitigating land taking impacts through negotiated agreement, expropriation, and compensation. The RF will also include an annex describing the protocols for acceptance of VLD where circumstances meet requirements under ESS5, and will also describe the process by which such VLD should take place. The RF will be prepared within 60 days of effectiveness. For construction activities that are determined to carry a risk of land acquisition and/or involuntary resettlement, the RPF will contain guidance on the preparation of site-specific Resettlement Action Plans (RAPs) which shall be prepared prior to the commencement of any such activities. ESS6 - Biodiversity Conservation and Sustainable Management of Living Natural Relevant Resources Feb 07, 2025 Page 7 of 9 The World Bank Sindh Livestock And Aquaculture Sectors Transformation Project (P179003) Aquaculture activities may have adverse impacts on freshwater lakes and rivers in the areas due to water pollution, and generation of aquaculture related waste. These impacts can be particularly detrimental in critical habitats including mangrove forests and wetlands which are already vulnerable. For this reason, project activities will not be implemented in critical habitats, and this is described in the negative list in the ESMF. Additionally, the introduction of non-endemic species which are currently being reared in existing aquaculture operations in the province can pose the risk of these species being introduced into natural habitats and ecosystems, potentially becoming invasive and impacting endemic species through increased competition and/or predation, or through the introduction of novel diseases and parasites. Additional risks include the potential loss of native vegetation due to the expansion of livestock and aquaculture operations, and the heightened risk to bird populations, particularly vultures, from the use of certain veterinary medicines like diclofenac and aceclofenac, which have been scientifically identified as extremely harmful to these species. A detailed Ecological Risks and Impacts Mitigation Plan has been prepared as part of ESMF L&FD contain detailed assessments of the risks related to this standard, as well as mitigation measures and implementation guidance. ESS7 - Indigenous Peoples/Sub-Saharan African Historically Underserved Traditional Not Currently Relevant Local Communities This standard is not relevant. No indigenous people meeting the ESS7 criteria are present in the Sindh province. ESS8 - Cultural Heritage Relevant This standard is relevant. Although the project activities are not expected to directly impact any cultural heritage Public Disclosure sites, some excavation work is expected for the construction activities. The ESMF therefore includes chance-find procedures which will guide the handling of previously unknown cultural heritage discovered during the implementation of the project. ESS9 - Financial Intermediaries Not Currently Relevant Not relevant. B.2 Legal Operational Policies that Apply OP 7.50 Operations on International Waterways Yes OP 7.60 Operations in Disputed Areas No B.3 Other Salient Features Use of Borrower Framework No Not used Use of Common Approach No Not Applicable Feb 07, 2025 Page 8 of 9 The World Bank Sindh Livestock And Aquaculture Sectors Transformation Project (P179003) C. Overview of Required Environmental and Social Risk Management Activities C.1 What Borrower environmental and social analyses, instruments, plans and/or frameworks are planned or required by implementation? The key requirement from the borrower during project implementation include; • Implementation of ESMF, LMP and SEP • Preparation and implementation of site-specific instruments (ESMPs/Checklists) • Preparation and implementation of RF (and of ARP/RPs as and when required) • Hiring of E & S staff as per ESCP requirement • Hiring of Supervision Consultant (and subsequent contractors if any) with dedicated E & S staff • Supervision and monitoring by PCMU and respective PMUs and submission of quarterly progress reports to the bank III. CONTACT POINT World Bank Task Team Leader: Myriam Mireille Veronique Chaudron Title: Senior Agriculture Economist Email: mchaudron@worldbank.org Public Disclosure TTL Contact: Shafick Hoossein Job Title: Senior Environmental Specialist Email: shoossein@worldbank.org IV. FOR MORE INFORMATION CONTACT The World Bank 1818 H Street, NW Washington, D.C. 20433 Telephone: (202) 473-1000 Web: http://www.worldbank.org/projects V. APPROVAL Task Team Leader(s): Myriam Mireille Veronique Chaudron, Shafick Hoossein ADM Environmental Specialist: Sana Ahmed ADM Social Specialist: Babar Naseem Khan Feb 07, 2025 Page 9 of 9