Yellow River Basin Green Farmland and High-Quality Agriculture Development Project The Ministry of Agriculture and Rural Affairs (MARA) is seeking support from ADB to demonstrate how the agriculture sector in the Yellow River basin can be transformed into one which is based on: (i) stronger and more capable institutions that can support sustainable sector development; (ii) sustainable and resilient production bases that balance producing food and agricultural products with environmental protection and rehabilitation and climate adaptation and mitigation; and (iii) vital rural agribusiness that add value to basic commodities through value chain development and market connectivity. The proposed project will capture and share knowledge and lessons from project initiatives to serve as an example within the PRC and to other developing member countries. The proposed project will have three outputs:

Output 1: Institutional, technical and management capacity and coordination strengthened. This output will address the issue of insufficient institutional capacity and coordination which inhibits agriculture sector development and environmental protection along the Yellow River. This output will support: (i) the implementation of sustainable agriculture modernization through policy reform, improved governance and institutional strengthening and organizational capacity building that focus on balancing production and environmental protection priorities; (ii) the building of stronger coordination mechanisms within and across other sectors for comprehensive rural economic development; (iii) sustainable financing mechanisms to bridge the funding gap and promote investment in agribusiness, which can increase sector output and value; (iv) explore opportunities for use of financial incentive mechanisms such as eco-compensation to strengthen environmental protection; and (v) provide training, capacity building, knowledge sharing based on stronger links to science and research and extension services for sustainable and high-quality development. Through this output the enhanced capacity and coordination will enable a more unified and sustainable development pathway for the agriculture sector, environmental protection, and rural development.

Output 2: Green and climate resilient agricultural production bases constructed. This output will address the outdated and inefficient agricultural production system issues which constrain production efficiencies and limits farmer income potential. This output will (i) invest in the development of medium to high quality farmland; (ii) provide equipment and materials to implement sustainable and modern farming practices; (iii) support climate smart agriculture practices including training, awareness raising, and capacity building for improved practices, approaches and technologies; (iv) put in place waste management systems for plastic film, fertilizer and pesticide packaging, and organic waste (crop residue and livestock manure) recycling; (v) build the capacity of farmer specialized cooperatives to support and organize of small-holder farmers production activities. This output will upgrade production systems to ensure they are more efficient with positive impact on the environment.

Output 3: Agricultural value chains strengthened. This output will address the constraints faced by agribusiness's that hamper their ability to add value to food and agricultural raw products through processing, storing, and marketing their products. This output will support: (i) stronger cooperation linkages between farmers and agribusiness to ensure the stable supply of high-quality raw products; (ii) agribusinesses to upgrade infrastructure and facilities such as warehouses, cold storage facilities, and marketing facilities to increase value addition; (iii) improvement of systems and processes for and increased production efficiency, and coordination with other supply chain segments of the agriculture sector; (iv) demonstrate use of high-level technology including digitalization and e-commerce to promote business development; and (v) put in place an enabling environment as an incubator for rural enterprises and agribusiness. This output will strengthen agribusiness to enable them to become a leader for sector economic development that can support local livelihoods, contributes to food security, and increases rural employment.

These outputs will result in the following outcome: sustainability of green agricultural production systems in the participating project provinces improved. The project will be aligned with the following impact: resilient ecological protection and food security in the Yellow River basin achieved.