Entrepreneur Driven Approach

The approach developed by SDC and Skat supports entrepreneurs who are willing to invest in a VSBK firing unit within their existing or new brickyard. The pilot entrepreneurs remain fully responsible for establishing, supplying and operating their brick yards, including the new VSBK. They decide about investments and risks and receive the entire benefits, once the profit zone is reached. The project offers free-of-cost technical services and specific financial support:

Subsidised Upfront Investments: During a pilot phase, entrepreneurs with an “innovator” mindset can be encouraged to invest in a VSBK by subsidising the upfront investment, since piloting a new technology in a new country involves higher degree of risk and also requires higher upfront investments than at a later stage, when all required supply and support services and skills are established on the local market. SDC offered a lump sum subsidy of 15,000 USD for each pilot entrepreneur in Afghanistan. Later generations received lesser upfront subsidies.

Subsidising Support Services: During the kiln construction and initial operation, SDC offered free-of-cost engineering, on the job training and technical counselling services by Nepali and Afghan VSBK engineers, kiln manager, and firing crew.

Performance based Production Incentives: As the initial production and fine tuning can be more cost intensive than the investment on the hardware, additional financial support may be justified for entrepreneurs piloting a new technology. In order to encourage and reward good management efforts in optimising the production, the financial support is linked to the output.

After a critical mass of VSBK is established and operational, entrepreneurs may acquire knowledge and skills directly from other VSBK entrepreneurs, allowing a cost effective post-project dissemination.

Subsidised turnkey arrangements

In India, a local agency establishes a demonstration kiln, allowing interested entrepreneurs to see a VSBK (and to test fire bricks from his/her site before deciding about his/her investment. In the following a skilled construction crew establishes a ready-for-use VSBKs for new VSBK entrepreneurs and hands over the kiln, once the fire is stabilised. The entrepreneurs invest a predefined amount, while the rest of the costs are subsidised. Further support, is offered on commercial basis.

Tax Advantages and a favourable regulatory framework

In India and Vietnam, VSBK was supported by the Government by offering favourable tax conditions as compared to other more polluting brick kilns and allowed construction near urban settlements and forests, while BTKs and clamp kilns were banned from these areas. Also the Afghan authorities showed interest in a developing a regulatory framework which favours clean brick production.