THE 33486 WorldBank IN INDIA VOL 3 / NO 5 MARCH 2005 INSIDE Tsunami relief for India 1-4 Bank Executive Directors Bank ready with US$ 553 million visit India 5-6 Development Dialogue 7-8 for tsunami relief in India Events 9-12 Recent Project Signings 13 New Additions to the T he World Bank will make available up to US$ 553 million in assistance for the reconstruction and rehabilitation of tsunami- affected areas in India, where government estimates say some 10,749 Public Information Center people died, another 5,640 are still missing, 6,913 were injured and 14-23 close to 650,000 have been displaced. Contact Information 24 The Bank – in conjunction with the government of India (GOI) and other multilateral partners including the Asian Development Bank (ADB) About the Photograph: and the UNDP – conducted a needs’ assessment in early February to A woman in Cuddalore evaluate the level of assistance needed for reconstruction. The team district of Tamil Nadu surveys submitted a summary of its assessment to the government of India on the remnants of her home, wrecked by the December February 18 and will be submitting the draft assessment report in early tsunami March. The World Bank in India • March 2005 12 Right: Following the need’s assessment, the Bank, Food being ADB and UNDP will discuss financing shares delivered to Poompuhar in and arrangements with the government. Tamil Nadu The government has stated that it hopes disbursements can begin before the end of March 2005. The tsunami generated enormous human suffering and considerable localized loss of assets in both the public and household sectors, and widespread loss of livelihoods, Overall, it appears that GOI has been highly especially from fishing, in the affected areas effective in immediate relief and recovery, of India. It is clear that, in addition to repair including disposal of bodies, disinfection, of infrastructure, priority needs will be for vaccination, provision of food, water, and housing; for restoration of assets to generate emergency shelter, and sanitation and livelihoods, notably for fishermen but also for clearing of debris. There has been major farmers; and for coastal protection support from Indian NGOs, and significant investments and disaster preparedness. funding has been raised from the public, Immediately following the tsunami, the GOI especially through an appeal launched by had announced that it was not seeking any the Prime Minister. UN agencies on the outside help with immediate relief. It ground, notably UNICEF, and locally mobilized major resources for urgent relief in represented international NGOs have also the affected areas in India (particularly Tamil helped with relief efforts. Nadu and the Andaman and Nicobar In India, the Bank will follow the three Islands), and also provided support to Sri principles that have guided Bank support for Lanka, the Maldives, Indonesia and Thailand. tsunami recovery efforts in other countries. On January 10, the government wrote to the First, the governments of the affected World Bank and to ADB asking for support countries must have the central role and for rebuilding infrastructure, both public and ownership of the recovery efforts. Second, private, for the rehabilitation of livelihoods of communities should be involved in those affected, and in developing disaster assessing their needs and designing prevention and management systems for the recovery programs, linked to long-term future in the four affected mainland strategies for growth and poverty reduction. territories (Andhra Pradesh, Tamil Nadu, It is important that reconstruction be Kerala and Pondicherry). An identical undertaken in ways that help to break the request was addressed to the UN (under the cycle of poverty in these communities. Third, coordination of UNDP) on January 12, 2005. the international community must act in A joint World Bank, ADB, and UNDP needs coordination, both in the relief and the assessment team visited the affected recovery phases, to ensure efficient use of districts from February 1 to 16, meeting state donor resources, and work with the and district officials, private sector and NGO governments of affected countries to set volunteers, and most importantly, affected clear goals and monitor and evaluate families themselves. progress. Right: Fleets of fishing vessels were destroyed in the tsunami jeopardising the livelihoods of hundreds of fisherfolk 12 2 The World Bank in India • March 2005 Above: The tsunami disaster in the Indian Ocean economies of these countries, sectoral People in was one of the worst natural disasters in knowledge from operations and analytic Chinangudi in modern times. Well over 200,000 people work, procurement and financial Tamil Nadu’s Nagapattinam died and more than 1.5 million people lost management skills, and experience with district queue their homes and often their livelihoods. donor coordination and reconstruction up for kerosene As in most disasters, it was the poor that financing – in assisting countries in supplies were most affected. formulating their recovery plans. Losses are estimated to total more than A portal on the Bank’s tsunami related US$7 billion. Private assets, including reconstruction effort is available at housing and business equipment, account www.worldbank.org/tsunami. for the largest share of the losses. For other online resources connected with the tsunami, see page 21. In a first phase of support, the Bank has already committed in the coming months to provide financing, essentially through IDA, on the order of US$246 million for Indonesia, Below: US$14 million for Maldives, and US$150 Hundreds of displaced people are now living in million for Sri Lanka, drawing on IDA13. temporary shelters like these The Bank moved quickly to (a) provide assistance on the ground in affected countries for expedited recovery planning; (b) mobilize its financial support; and (c) help coordinate rehabilitation and recovery support, when asked to do so by the authorities in the affected countries. The Bank was able to use its comparative advantage – in-house expertise on recovery and reconstruction, knowledge of the overall The World Bank in India • March 2005 12 3 ‘We need to get back into the water and start living again’ The World Bank Staff Association in India set up a collection for the tsunami-affected and used it to fund the construction of temporary houses for 40 families in Nagapattinam district of Tamil Nadu. A report from Patsy D’Cruz on what staff representatives saw when they visited the devastated area. W e left Chennai for Nagapattinam district, approximately 340 kms from Chennai, in the early hours of the morning on Pongal Day – those deceased were given Rs.1 lakh per deceased member. Drinking water was being provided from newly-dug borewells. which is the local harvest festival. We first visited Chinangudi village, which had a total of In village Taalampettai, Mr Shaktivel, who 570 families, of which 270 were affected by the is overseeing the relief work on behalf of the tsunami, with 43 people being killed. Selvaraj, government, says they have enough food the panchayat president described what stocks to feed the villagers for the next two happened: “Water rose very high and dropped months. “Material has been pouring in and down on us and collected all that it could and many a time people have more than what is receded back into the sea. In half an hour, required,” he says. The villagers, however, three huge waves completely submerged all had one regret – they were being supplied that was in this village.” vegetables plenty, they were not getting any fish, their staple food. More than a fortnight The sea had come inland almost a kilometer after the tsunami, no fishermen had yet and it was almost six days before people could ventured into the sea. return to the village. Thatched houses along Our last stop was the village of Poompuhar the beach were destroyed, a few brick houses which had witnessed maximum destruction. were filled with sand and salt, the few fishing Over 200 lives were lost here, including many nets and boats that remained were destroyed children; most died because they were unable beyond use. to flee the waves across the thorny bushes that marked the village’s perimeter and were The World Bank Staff Association is washed back into the sea. About 450 families sponsoring the construction of 40 temporary lost everything they possessed. Debris of houses for fishermen here. The houses thatched houses, utensils, and clothes lay are 15 ft. by 10 ft. rectangular rooms made strewn all over. Boats and catamarans carried of corrugated coal-tar sheets placed on far into the mainland lay broken and beyond bamboo poles. Each row of housing contains repair. Government machinery seemed to have 10 of these huts that share common walls and worked slowest here. Debris had still not been a common roof. It was impressive to see that cleared and swamps remained. People stood all work done in the village is with the in long lines for kerosene and food. collaboration of the gram panchayat; it is the panchayat that is making the final allotment These are people who each day live on the of the temporary shelters. edge of life. Their existence is dependant on the very sea which destroyed all they had. We also saw how, some two weeks after the “We are not scared of the water. It is our disaster, the government machinery had begun livelihood, and we know no other trade,” says to fall in place. Project Officers had been Rajendran, the gram panchayat president in assigned by the District Collector to look after Poompuhar. They have heard that the five or six villages each. Each affected family government will be providing boats and nets was being provided 60 kgs of rice, pulses, and eagerly await that day. vegetables, and Rs. 4,000 in cash. Families of Temporary houses sponsored by the World Bank Staff Association being constructed at Chinangudi in Tamil Nadu’s Nagapattinam district 12 4 The World Bank in India • March 2005 Bank Executive Directors visit India A group of nine Executive and Alternate Executive Directors (EDs) and one member of the Corporate Secretariat of the Mr Chander Mohan Vasudev, Executive Director from India, who also represents Bangladesh, Bhutan and Sri Lanka in World Bank came on a five-day visit to India addition to his own country, India on the over end-January and early-February. World Bank’s Board of Directors, was the host of the delegation visiting India. The visiting group represents 56 out of the Bank’s 184 member countries. The visit is The visiting group included Mr Sid Ahmed part of a regular program where EDs visit a Dib from Algeria, Mr Ad Melkert from number of countries each year to review Netherlands, Mr Tom Scholar from United Bank programs and policies and results on Kingdom, Mr Chander Mohan Vasudev from the ground. The EDs and Alternative EDs are India, Mr Pietro Veglio from Switzerland, not part of the Bank’s management. They Mr Jorge Familiar Calderon from Mexico, play a dual role as officers of the Bank, and Mr Terrence O’Brien from Australia, representatives of the governments in their Mr Toshio Oya from Japan, and Mr Anthony constituencies on the World Bank’s 24 Requin from France. member Board of Directors. All World Bank loans and credits must get approval from The group also visited development projects the Board of Directors. in Delhi, Rajasthan and Mumbai to better acquaint themselves with the situation on During their visit, the EDs called on the the ground. In the Capital, the EDs visited a Prime Minister, Dr Manmohan Singh. municipality-run primary school and an They also met the Union Minister of Road Alternate School/Learning Center where they Transport and Highways, Mr T R Baalu, as appraised interventions to increase access well as senior officials from the Planning to and improve the quality of primary Commission and the ministries of Finance, education. The Learning Center/Alternative Power and Water Resources. They also School are community-based initiatives to attended briefings by key policy-makers in provide access in a non-formal mode to India on matters related to poverty children in areas where there is no formal reduction, including education, health, rural school. The EDs said were struck by the development, infrastructure, private sector number of women teachers in the schools, development, improving public service and were impressed by the quality of delivery and the investment climate. education being imparted. Right: Mr Anthony Requin, the Bank’s Executive Director from France at a primary school in Delhi The World Bank in India • March 2005 12 5 They felt that the alternate schools were implemented by the poor themselves. a good way of integrating out of school Among the groups they interacted with were children in an education system. leather workers and dairy farmers who had organized themselves into formal groups to In Rajasthan, the group visited sites related better deal with common problems of to Bank-assisted education and livelihood training and marketing. projects, and met the Rajasthan Chief Minister and Chief Secretary, among others. In Mumbai, the EDs visited sites of the While in the state, they visited two villages in recently-closed Mumbai Sewage Disposal Dausa district to witness the rural livelihood Project and the Asha Project, which is a part program of the Rajasthan District Poverty of the Bank-assisted National AIDS Control Initiatives Project. The Project seeks to Program. The commercial sex workers they improve economic opportunities, living met told the EDs about how the Project had standards and the social status of the poor helped them form a community organization in selected villages of seven districts in to deal with not just HIV-related issues, but Rajasthan. It supports small-scale sub- also larger social, health and economic projects that are chosen, planned and issues. Partnership grows with Orissa T he World Bank is stepping up its assistance to Orissa, one of the poorest states of India. In keeping with the intention forest-dwellers in poorly-connected regions. Over the longer term, improving the effectiveness of public investments expressed in the Country Strategy for India and service delivery in elementary for 2005-08, to try and build a productive education, basic health and social development relationship with the four states protection are necessary conditions for where poverty is increasingly concentrated – rapid poverty-reducing growth. Bihar, Jharkhand, Orissa and Uttar Pradesh – the Bank is enhancing its financial and As the government of Orissa sets in technical assistance to Orissa, home to motion its process of cross-cutting policy 5 percent of India’s poor. reform, the Bank has been at the ready with financial and technical assistance Despite its rich endowment of mineral across many sectors. It has passed on wealth, forests, lakes, rivers and a long the first in a series of adjustment loans/ coastline, Orissa remains among the poorest credits to support Orissa’s core fiscal, of India’s major states. The state, 85 percent governance and structural reforms; it has of whose population lives in rural areas, is helped pilot a farmer-led irrigation characterized by relatively high incidence of management scheme; it has facilitated an subsistence production, traditional land intensive interface between the state tenure patterns and pronounced social and government and the NGO sector, which regional differences. Among the poorest were deadlocked over environment and people in the Orissa are the Scheduled social issues; it is preparing a state-level Tribes, who constitute 22 percent of its total Investment Climate Survey; and is population (compared to 8 percent in India) planning new investments for and comprise 40 percent of the poor in the infrastructure (especially state roads) state. and livelihood development. The development challenge before the Three Bank-financed investment projects government of Orissa thus involves have been recently completed or are soon correcting the prevalent low rates of to be completed: in the power, health and economic growth and the high degree of water resources sectors. Trust fund grants inequality, while ensuring the effective are being used to support pilot delivery of basic services, especially to tribal interventions in tourism and community- 12 6 The World Bank in India • March 2005 till 2009, each one larger than the former, and all aimed at supporting the medium- term program for the socio-economic development of Orissa. The expected benefits include more rapid and broad- based economic growth, improved fiscal performance, enhanced quality of governance and service delivery, leading to rapid poverty reduction. The government of Orissa has, of late, had differences with some of the more prominent NGOs working in the state over issues Above: based development initiatives. The Bank and related to the exploiting of mineral The Bank Department for International Development resources, the environment and involuntary facilitated a colloquium (DFID) of UK, are together also supporting resettlement. To help initiate a dialogues on between the multi-state or national level programs these issues, the Bank facilitated a government of covering Orissa, including the District colloquium held in Puri on January 21. This Orissa and Primary Education Program. concluded with an agreement between the the state’s state government and the voluntary sector to voluntary sector The first of a series of adjustment loans/ set up a task-force comprising government credits, proposed to support Orissa’s core and non-government representatives which fiscal, governance and structural reforms would help develop a framework for during 2004-09, was passed on to the state partnership, information sharing, and conflict in December 2004. If the state’s reform resolution between government and civil program proceeds as planned, the Bank society, as well as look into some could make up to four adjustment operations substantive development issues. Development Dialogue Knowledge-sharing activities of the Public Information Center SEMINAR World Bank & Its Knowledge Resources 21 January 2005 • Pune A s part of its centenary year activities, The Servants of India Society’s Dhananjayarao Gadgil Library of the Gokhale Institute of Politics and Economics (GIPE), Pune, collaborated with the WB Public Information Center (PIC) to organize a seminar on ‘The World Bank and its Knowledge Resources’. Right: Bank Speaking on ‘Recent World Bank Research publications on India: Answers and Questions’, on display Mr Stephen Howes, the Bank’s Lead at the Economist in India, highlighted interesting Dhananjayarao Gadgil Library research findings from the Bank’s work on in Pune the 10 most-raised issues about India: 7 The World Bank in India • March 2005 12 – Has poverty fallen in India? BOOK FAIR How does it fare vis a vis China? Kolkata Boi Mela – How serious are infrastructure 26 January- 6 February 2005 • Kolkata bottlenecks in India relative to other countries? How do they vary across India’s states? – Does free power benefit poor farmers? – How (un)equal are educational opportunities faced by Indian children? – Are public servants overpaid in India? The presentation sparked a lively discussion with participants who comprised academics, researchers, NGO representatives, and librarians. The Director of GIPE, Prof A K Sinha chaired the session and, in his remarks, touched on poverty, productivity, T he New Delhi Public Information Center took its yearly exhibit to the Kolkata Boi Mela (Book Fair), the annual highlight for and employment/unemployment issues. those in the publishing trade. The Fair, Regarding education, he remarked that had spread over a sprawling 8.5 lakh sq feet saw India concentrated on primary education 592 stalls and recorded some 2.5 million rather than on higher education, after footfalls. Independence, the masses might not have been left behind. The World Bank stall was part of the complex housing international book-sellers and distributors as well as other global agencies and received an average of 1,000 visitors each day. The latest annual publications such as the World Development Report, World Development Indicators, Global Development Finance, Global Economic Prospects, and the Annual Report, the latest India Sector and Economic reports and uptodate operational documents were displayed. Several publications on trade, Welcoming guests seated in the historic, economics, finance, globalization, health, 100-year-old library hall, Ms Asha Gadre said education, infrastructure, poverty, that the seminar at GIPE would “provide a environment, public administration, platform to bring together the World Bank, agriculture were also put out for readers. local NGOs, individual researchers in A poster display as well as a continuously various fields and the Institute, to initiate a running desktop presentation on the World meaningful interaction”. Bank and its work in India helped increase awareness about the Group’s activities. The second half of the program included a presentation on the NDO PIC and a live demonstration of the World Bank’s online knowledge resources. A display of recent World Bank books and reports was mounted against a backdrop of a set of posters on the World Bank. A similar knowledge sharing event about the Bank’s web resources was organised in Mumbai as part of the International Conference on Information Management over 21-25 February. 12 8 The World Bank in India • March 2005 Events WORKSHOPS State Fiscal Reforms in India February 2005 T he World Bank report, State Fiscal Reforms in India: Progress and Prospects, launched in November 2004 in New Delhi was subsequently discussed in a series of seven workshops around India, including in Chennai, Kolkata, Patna, Hyderabad, Bangalore and Bhubaneswar. 13 Key Messages In most states, government representatives Expenditure participated in the workshop and provided 1. A policy of hiring restraint (zero net hiring) not just their feedback on the Report, but and real wage restraint can deliver also their own views on fiscal reforms. significant fiscal gains. 2. Growth in the pension bill can be “This series of seminars dispelled the contained by parametric and structural negative impressions that surrounded the reforms. whole issue of reforms. There are clearly 3. There are no sure paths to subsidy some reforms that are in the ‘too hard’ reduction, but better subsidy category, and there are definitely risks, but, management and more commercial discipline in subsidy-receiving sectors overall, the states remain – and, in fact, are are critical. increasingly – committed to putting their 4. The quality of spending can and must fiscal house in order,” commented one of be improved the Report’s authors and Senior Economist Revenue Mr V Ravishankar. 5. VAT introduction should be voluntary, and on the basis of floor rates. To help communicate the findings of the 6. The tax base of the states should be Report, the authors boiled down its messages increased by service taxation and and recommendations to a list of 13. (See enhancement of the professions tax box) “We found a lot of consensus around limit. 7. Tax administration reforms are more this list of 13, but that doesn’t mean that all important than tax policy reforms, of them have been, or will be, adopted. But though they have received less attention. there is a broad consensus on what needs Transfers: Loans & grants to be done,” says Mr Ravishankar. 8. States should be given more borrowing flexibility within firmly established global According to the World Bank’s Lead caps. Economist for India, Mr Stephen Howes: 9. Reforms to the grant system should aim “Taking our Report to the states is an to make it both more progressive and increasingly important for us, for two reasons more performance-oriented. 10. In a fiscally stressed system, an increase – first, India is of such a continental size. in the Government of India tax/GDP ratio If you were launching a report in Europe, is critical, especially for the poorer states. you couldn’t only discuss it in Brussels. Institutions And, second, so many of the reforms we are 11. A central agency should be given the looking at are in the domain of the states. mandate to collate and improve state- The more debate there is at the state level, level fiscal data. the better the prospects for sustainable 12. The ‘plan’/‘non-plan’ distinction should be abolished. reforms.” 13. Adoption of fiscal responsibility Read the Report online at legislation by all states, and its monitoring by the Government of India http://imagebank.worldbank.org/servlet/ and external agencies, will provide WDSContentServer/IW3P/IB/2004/11/23/ important institutional backing for 000012009_20041123101218/Rendered/PDF/ state-level fiscal reforms. 288490IN.pdf The World Bank in India • March 2005 12 9 CONFERENCE — an appealing, but quite elusive goal — Mobilizing Urban Infrastructure Finance and the improving the performance of the in a Responsible Fiscal Framework: public sector; and finally how to seize Lessons from Brazil, China, India, political opportunities to put in place a Poland and South Africa sound financing framework while improving 6-8 January 2005 • Jaipur service delivery in the short term. WORKSHOP I n most developing countries, expanding investment in urban infrastructure is central to maintaining the growth momentum Land Acquisition and Resettlement & Rehabilitation Issues in the Transport Sector and for improving the citizen’s quality of life. 10-11 February 2005 • New Delhi Reconciling this to sound fiscal management, especially in the context of decentralization, was the theme of a conference held in Jaipur in early January. T he World Bank organized a two-day knowledge-sharing workshop intended to draw lessons and identify critical issues in The conference examined how these issues land acquisition (LA) and resettlement and are being resolved in Brazil, China, India, rehabilitation (R&R) of displaced persons in Poland, and South Africa and sought to transport sector projects, and to identify generate a body of practical, and opportunities for moving towards a more transferable, implementation experience. programmatic approach. The conference brought together The workshop thus started a process to government officials and representatives of i. develop sectoral R&R policy; financial institutions, academics, and think- ii. evolve uniform approaches to R&R tanks, but the format put the experiences including standardization of methodology of practitioners in the spotlight, with most for compensation and assistance; presentations made by those actually iii. assess systemic issues related to land responsible for formulating and and procedures and processes for land implementing policy. The cases featured acquisition; include three of the world’s largest iv. assess institutional capacity; and decentralized nations; together the five v. improve project processes to enable countries featured in the conference account delivery of project benefits with efficiency for nearly a third of the world’s urban and equity. population. The workshop brought together almost 60 As Ms Sonia Hammam, Sector Manager for participants, including project staff of various Water and Urban in South Asia said: “The transport sector projects, senior discussions demonstrated clearly that many management of National Highways Authority of the same issues recur in all of these of India as well as state Public Works countries, and achieving the right balance is Departments, Central and state Government an ongoing process not a once-off reform”. policymakers, officials from the Ministry of Rural Development (MoRD), NGOs, social Some of these issues are: how to manage the risks of decentralizing financing and responsibility to lower levels of government while still rewarding local governments that manage their finances well; how to mobilize the financial sector as a means of both providing financial discipline and efficiently channeling private savings into city-level infrastructure investments as local governments grow into their role of self- standing financial entities; how to find the right balance between mobilizing private participation in urban infrastructure finance 12 10 The World Bank in India • March 2005 scientists, legal experts and staff from the WORKSHOP World Bank and the Asian Development Gender and Economics Bank. 1 February 2005 • Delhi The government officials and a few NGOs presented project case studies (mainly from Bank-supported projects) on LA and R&R T he workshop provided for a dialogue between sociologists and economists on the role of women in the economy. The which were followed by discussions. The keynote presentation was made by Prof MoRD made a presentation on National R&R Sonalde Desai, Professor of Sociology in the Policy 2004. Lessons from East Asia and on University of Maryland and focused on an the Asian Development Bank’s approach to overview of research and policy issues in managing road projects were presented. South Asia. This was followed by a Break-out sessions were organized to arrive presentation by the Bank’s Lead Economist, at specific short-term and long-term action Mr Lant Pritchett on ‘An Economist’s View of points for scaling-up investment in the Gender’. Ms Lucia Fort from the Poverty sector. Reduction and Economic Management group summarized how World Bank VISIT approached the challenges of gender in Young Civil Servants of the Netherlands’ its operational work. Ministry of Finance 24-29 January 2005 • Delhi WORKSHOP Client Connection February 2005 • Delhi I n a bid to simplify business processes related to loan administration and procurement, the World Bank allows government officials connected with Bank- assisted projects to access information related to all their loans, credits, grants, and trust funds through a secure, password- protected website. In the second round of workshops relating to this process, known as Client Connection, more than 60 people associated with 25 different Bank-supported A 35-member committee of Young Civil Servants from the Netherlands’ Ministry of Finance visited the Bank’s New projects were trained over the month of February. Delhi office in late January. They were in Among the people who participated in the India as part of an annual research project to workshop were staff from various Central examine a promising economy of the future. and state entities and implementing agencies, including those from the Office of VIDEO-CONFERENCE Controller of Aid Accounts and Audit. Under Trade in Agriculture Client Connection, staff in project 21 February 2005 implementing agencies are able to view financial information related to their projects, A global video-conference on ‘Trade in Agriculture’, organized by World Bank Europe office, was attended by members of as well as submit procurement documents to the Bank for review online. In addition, the Client Connection features a wealth of Parliament from various countries including country-specific data on each country’s India, Kenya, South Africa, Japan. The homepage. Governments no longer have to participants from India were Mr Robert look in several places on the Bank’s external Kharshiing, Member of the Rajya Sabha and website to find country-specific research, Mr Santosh Bagrodia, MP and Deputy statistical data and news. It is now all in Chairperson of the Parliamentary Network one central location. on the World Bank (PNOWB). 12 The World Bank in India • March 2005 11 SYMPOSIUM rewards to skills more unequal. This means Growth & Competitiveness of India in that it might be heading for a scenario where the 1990s 10 February 2005 • Chennai it is both socially stratified and has high income inequalities. T he Indian economy is in the 90th percentile of growth globally, with only 10 percent of world economies growing at a “This is what we saw in South Africa and in Brazil more recently and can be very dangerous,” he said. “Dealing with it involves faster rate, but because it started from a low taking into account the difference between base, it will be 34 years before it can reach an ‘equity’ approach that emphasizes the GDP level of the US of the 1950s, said equality of opportunity and an ‘inequality’ the World Bank’s Lead Economist, Mr Lant approach that emphasizes equality of Hayward Pritchett, while giving the keynote outcomes,” he added. address at a National Symposium on ‘Growth and Competitiveness of India in the CONFERENCE 1990s’ at Loyola College in Chennai on Deutsche Bank India Investor Conference 10 February. 21 February 2005 • Mumbai However, said Mr Pritchett, India should aim at a steady economic growth rather than an accelerated pace if it wanted to avoid a a “stall” in India’s growth path. Citing the M r Stephen Howes, the World Bank’s Lead Economist for India, delivered one of the keynote addresses at the examples of Brazil, Japan and the Deutsche Bank’s ‘India Investors’ Philippines, he said that these economies Conference’ in Mumbai. Titled ‘Miracles in had “episodes” of very rapid growth but then Asia? East Asia and South Asia Compared’, suddenly went from boom to bust. “While his presentation examined economic India is relatively free of some of the major performance in these two regions over the causes of stall around the world, it does last 40 years. have real risks,” he said. Speaking to an audience that comprised Listing India’s strengths, he pointed to its over 100 investors from financial centers in strong democratic roots and political the United States, the United Kingdom, continuity, elite education, open ideology, a Europe and Asia, Mr Howes noted that, large (both in terms of population and area) while East Asia had left South Asia behind integrated market, adequate resources, over this period, for the last twenty years and familiarity with the English language. South Asia had in fact been growing as fast The major pitfalls facing the country centre as East Asia excluding China. The on the lack of fiscal means to meet presentation highlighted government infrastructure needs, and the possibility of effectiveness as one of the key factors some “lagging regions” that might slow behind the differential growth performance the growth process, he said. in the two regions. Pointing to an interesting dichotomy, Mr Pritchett said that while India is perhaps one East Asia has left South Asia behind... of the most unequal places in terms of the GDP pc (USD, 1995 prices) 1960-2002 gap in educational attainment – with world- class elite education but mass illiteracy – 1400 1200 but, at the same time, it is one of the most 1000 equal countries in income/consumption 800 terms. “While India has been socially 600 stratified (access to the elite was limited by 400 wealth, caste, ethnicity, parental wealth) but 200 0 the dominance of the public sector kept a 1960 1970 1980 1990 2002 check on actual inequality,” he said. East Asia East Asia China excl. China Moreover, India today is undergoing a shift in South Asia South Asia India excl. India which the economic changes are making the 12 The World Bank in India • March 2005 Recent Project Signings Tamil Nadu Health Systems Project Karnataka Urban Water Sector 5 January Improvement Project 18 February Dr Ranjit Bannerji of the Ministry of Finance and Mr Michael T he US$39.5 million loan was signed at the Ministry of Finance, with Dr Ranjit Bannerji, Joint Secretary, Department of Carter of the Economic Affairs, Ministry of Finance, World Bank sign the representing the Government of India and agreement for Mr P Ravi Kumar, Secretary, Urban the Tamil Nadu Development Department, Government of Health Systems Karnataka signing on behalf of the Project T he US$ 110.83 million project was signed at the Ministry of Finance, with Dr Ranjit Bannerji, Joint Secretary, Government of Karnataka. Mr. Michael Carter, the Bank’s Country Director for India, signed on behalf of the World Bank. Department of Economic Affairs, Ministry of The Project, for which the loan was Finance, representing the Government of approved by the World Bank’s Board on India and Mr Michael Carter, Country April 8, 2004, will support the Government of Director for India, representing the World Karnataka’s efforts to enhance the efficiency, Bank. Dr N Sundaradevan, Secretary Health, management, and delivery of water supply Government of Tamil Nadu, signed on behalf and sanitation to its urban residents. It of the Government of Tamil Nadu. supports the Government of Karnataka in The Tamil Nadu Health Systems Project aims launching its urban water sector reform to help the state of Tamil Nadu improve the process, and in demonstrating that effectiveness of its health system, both continuous, efficient and sustainable water public and private. service provision can be achieved. Forthcoming Events CONFERENCE OPEN HOUSE South Asian Conference of Open House for Youth Youth Organizations 21 March 2005 • World Bank New Delhi 17-18 March 2005 • Delhi Office T he South Asian Conference of Youth Organizations is being organized by the Indian Committee of Youth Organizations T his is planned as an initiative that will allow youth organizations to present who they are, what they do and how they with support from the World Bank. The main can contribute to the development agenda. objectives of the proposed conference are to take further the commitment made by the CONFERENCE World Bank during the Conference on Youth Electronic Government Procurement Development and Peace held in Sarajevo in 10-11 March 2005 • New Delhi 2004; to discuss issues and challenges facing young people today; and to develop a tool for sustainable dialogue between the World Bank and South Asian Youth T his conference aims to share knowledge from the lessons learned by governments that have successfully Organizations. About 60 representatives of implemented electronic procurement. youth organizations from India and from South Asia are expected to participate. 12 The World Bank in India • March 2005 13 New Additions to the Public Information Center T his is a select listing of recent World Bank publications, working papers, operational documents and other information resources that are now available at the New Delhi Office Public Information Center. Policy Research Working Papers, Project Appraisal Documents, Project Information Documents and other reports can be downloaded in pdf format from ‘Documents and Reports’ at www.worldbank.org Publications may be consulted and copies India Analytical & Advisory Work of unpriced items obtained from: Resuming Punjab’s Prosperity – Opportunities and The World Bank PIC Challenges Ahead 70 Lodi Estate New Delhi -110 003 Punjab is India’s most Tel: 011-2461 7241 prosperous state with the Fax: 011-2461 9393 lowest poverty rate. It is Internet: www-wds.worldbank.org ranked second only to Email: hbalasubramanian@worldbank.org Kerala in terms of overall level of human To order priced publications development among major Indian states. But at the Allied Publishers Ltd. same time, despite its 751 Mount Road impressive development Chennai - 600 002 record, Punjab is losing out Tel: 044-852 3938 to the more reforming Fax: 044-852 0649 Indian states in terms of attracting investment and Email: aplchn@vsnl.net creating employment. Bookwell According to this Bank report, Punjab’s state finances Head Office are under stress, its economy is growing slower than 2/72 Nirankari Colony the national average, the quality of public service Delhi - 110 009 delivery is not commensurate with its per capita Tel: 011-2725 1283 income and some of its human development indicators Sales Office: have started to languish or even deteriorate. 24/4800 Ansari Road Darya Ganj The report identifies six major challenges that are New Delhi - 110 002 a key threat to the Punjab’s long-term prosperity: Tel: 011-2326 8786, 2325 7264 i. Long-lasting impact of civil strife of the 1980s Fax: 011-2328 1315 on investment, growth and state finances; Email: bkwell@nde.vsnl.net.in ii. Low productivity of Punjab’s civil service; iii. A growing culture of subsidy and crowding out of Anand Associates public investment; 1219 Stock Exchange Tower iv. High level of regulatory burden and the quality of 12th Floor Dalal Street Mumbai - 400 023 infrastructure, which has not kept pace with the demand; Tel: 022-2272 3065/66 v. Corruption, including widespread evasion of taxes; Fax: 022-2272 3067 Email: thrupti@vsnl.com and Internet: www.myown.org vi. Weak implementation capacity of the government. Some of the state’s recent achievements on the reform Team Spirit (India) Pvt. Ltd. front include abandoning the populist, but fiscally and B - 1 Hirak Centre environmentally unsustainable policy of free power and Sardar Patel Chowk Nehru Park, Vastrapur water; being the second Indian state, after Karnataka, Ahmedabad - 380 015 to adopt a Fiscal Responsibility Act; passing the Punjab Infrastructure and Regulation Act 2002 to Tel: 079-676 4489 encourage greater public-private partnership in Email: business@teamspiritindia.net infrastructure; undertaking an ambitious agricultural diversification project; beginning the disinvestment of 12 14 The World Bank in India • March 2005 loss-making PSUs; and announcing its intention to Addressing the Challenges of Globalization: undertake significant decentralization of primary health An Independent Evaluation of the World Bank’s and education services. But unfortunately, after a Approach to Global Programs sincere start, the urgency to reform seems to have By Uma Lele faded in Punjab, notes the Bank report. Price: $ 20.00 The report lays out a number of policy options and English Paperback priorities that can help revitalize the reform process Published January 2005 and to restore the long-term prosperity of the state. ISBN: 0-8213-6065-5 SKU: 16065 Some of the key recommendations are: The accelerated pace of globalization has stimulated ● To restore the fiscal balance, the government should dramatic changes in trade, finance, intellectual comply with its Fiscal Responsibility and Budget property, private investment, information and Management Act; aggressively pursue tax policy and communications technology, health, environment, administration reforms; improve the composition of security and civil society. Addressing the challenges public expenditure by addressing overstaffing issue; posed by globalization often requires collective action better targeting subsidies; and, using the fiscal space at the global level. The World Bank is an important generated through these reforms, to step-up public participant in such programs and activities because its investment in physical and social infrastructure. global reach, its ability to mobilize resources, and its multisectoral expertise position it well to deal with the ● To improve the state’s investment climate, there challenges of globalization. is a need to streamline the administrative procedures involved in establishing new businesses Addressing the Challenges of Globalization derives cross-cutting lessons for the Bank on program ● To improve public service delivery in the state, steps selectivity, design, implementation, governance, suggested include the creation of a statutory civil management, financing and evaluation. The book also services board to reduce pre-mature transfers of civil identifies areas where further Bank action on its servants; restructuring and merging of departments to global-level strategy and programming is needed to improve their functioning; adoption of the right to improve the global program effectiveness. information law and transparency in tenders and procurement law; strengthening of anti-corruption institutions; and gradual devolution of primary health Mobilizing Private Finance for Local Infrastructure care and education services to local governments. in Europe and Central Asia: An Alternative Public Private Partnership Framework Publications By Michel Noel and Wladyslaw Jan Brzeski Global Agricultural Trade and Developing Countries Price: $ 15.00 Edited by M. Ataman Aksoy and John C. Beghin English Paperback Price: $ 45.00 86 pages English Paperback Published December 2004 448 pages ISBN: 0-8213-6055-8 Published November 2004 SKU: 16055 ISBN: 0-8213-5863-4 In recent years, the SKU: 15863 countries of the Europe and Global Agricultural Trade Central Asia (ECA) region and Developing Countries have experienced a marked presents research findings decline in the interest of international private operators based on a series of and investors in municipal infrastructure projects, in commodity studies of line with the trend experienced in other emerging significant economic markets. importance to developing countries. It presents The objective of this paper is to explore the possible detailed commodity studies for coffee, cotton, dairy, innovative elements of a Public-Private Partnership fruits and vegetables, groundnuts, rice, seafood (PPP) in an effort to rekindle the sagging private products, sugar, and wheat. These markets feature finance interest in municipal infrastructure in the ECA distorted policy regimes among industrial or middle- Region. The contemplated PPP model would involve income countries. government, municipalities, Local Infrastructure The studies analyze current policy regimes in key Investment Trusts, private equity funds and/or producing and consuming countries document the turnaround advisors, and International Financial magnitude of these distortions and estimates the Institutions. distributional impacts–winners and losers-of trade and domestic policy reforms. This book complements the recently-published Agriculture and the WTO that focuses primarily on the agricultural issues within the context of the WTO negotiations. 12 The World Bank in India • March 2005 15 Investment Climate, Growth, and Poverty: that a one-size-fits-all approach is unlikely to work. Berlin Workshop Series 2005 There is need to adjust intellectual property norms to domestic needs, taking into account developing Edited by Gudrun Kochendorfer-Lucius and countries’ capacity to innovate, technological needs, Boris Pleskovic and institutional capabilities. Price: $ 20.00 English Paperback 134 pages Customs Modernization Handbook Published January 2005 Edited by Luc De Wulf, ISBN: 0-8213-5957-6 José B. Sokol SKU: 15957 Price: $ 45.00 The book addresses English Paperback important topics discussed 352 pages at the fifth annual forum of Published January 2005 the Berlin Workshop Series ISBN: 0-8213-5751-4 co-hosted by InWent and SKU: 15751 the World Bank, held in Trade integration September 2003. At the meetings, key researchers and contributes substantially to policy-makers from Europe, the United States, and economic development and developing countries around the world met to identify poverty alleviation. In and brainstorm on development challenges and recent years the trade regime has been much successes that are examined in-depth in the World liberalized, but customs procedures are often still Development Report 2005: A Better Investment Climate complex, costly and non-transparent. This situation for Everyone. leads to misallocation of resources. This title presents selected papers from the meetings Customs Modernization Handbook provides an which highlight key issues on investment climate, such overview of the key elements of a successful customs as property and contractual rights, financial markets, modernization strategy and draws lessons from a regulation, governance, and corruption. number of successful customs reforms as well as from customs reform projects that have been undertaken by the World Bank. It describes a number of key import Intellectual Property and Development: Lessons procedures, that have proved particularly troublesome from Recent Economic Research for customs administrations and traders, and provides Edited by Keith E. Maskus and Carsten Fink practical guidelines to enhance their efficiency. The Price: $ 25.00 Handbook also reviews the appropriate legal English Paperback framework for customs operations as well as strategies 360 pages to combat corruption. Published January 2005 ISBN: 0-8213-5772-7 SKU: 15772 Making a Large Irrigation Scheme Work: A Case International policies towards protecting intellectual Study from Mali property rights have seen profound changes over the past two decades. Rules on how to protect patents, By Djibril Aw and copyright, trademarks and other forms of intellectual Geert Diemer property have become a standard component of Price: $ 22.00 international trade agreements. Most significantly, English Paperback during the Uruguay Round of multilateral trade 176 pages negotiations (1986-94), members of what is today the Published January 2005 World Trade Organization (WTO) concluded the ISBN: 0-8213-5942-8 Agreement on Trade Related Intellectual Property SKU: 15942 Rights (TRIPS), which sets out minimum standards of Mali’s irrigation scheme protection that most of the world’s economies have to was an outcome of colonial respect. settlement with the How will developing countries fare in this new corresponding lack of rights international environment? This book brings together for cultivators to own land, empirical research that assesses the effects of process paddy, and market rice. Post-independence, changing intellectual property regimes on various a coalition of government and irrigation agency staff measures of economic and social performance – contributed to governmental unwillingness to reform the ranging from international trade, foreign investment scheme’s management. Government interest lay and competition to innovation and access to new in satisfying the growing demand for rice from its technologies. burgeoning urban constituency and a fear of riots in Presenting an important development dimension to the response to rice shortages and high prices. Its interest protection of intellectual property, the book suggests also lay with maintaining the support of the agency’s staff. 12 16 The World Bank in India • March 2005 The authors analyze how field teams, funded by Capital Markets and Non-bank Financial Institutions bilateral donors, shaped technical and institutional in Romania: Assessment of Key Issues and change to fully reform management and how grain Recommendations for Development market reforms provided farmers stronger incentives By Ramin Shojai and and raised yields. The combination of changes inside Michel Noel and outside the scheme gradually shifted the balance Price: $ 10.00 of power and led to a stakeholder setup in which English Paperback organized farmers replaced the agency. 108 pages The success of the reform process lies in the way Published December 2004 Mali’s government came to commit to the irrigation ISBN: 0-8213-6015-9 reforms. The paper indicates how commitment by other SKU: 16015 governments may be achieved by using the same and This is part of the World other tools. Bank Working Paper series published to communicate the results of the Bank’s Roma in an Expanding Europe: Breaking the ongoing research and to stimulate public discussion. Poverty Cycle With only three years remaining before it joins the By Dena Ringold, European Union, Romania is working hard to improve its Mitchell A. Orenstein, and capital markets and non-bank financial institutions, which Erika Wilkens remain less developed than those in other accession Price: $ 30.00 countries. During 2003 and 2004, the Romanian English 268 pages authorities made significant efforts to draft, adopt, and Published November 2004 enact new legislation to align Romania with EU financial ISBN: 0-8213-5457-4 directives. Despite these efforts, however, challenges SKU: 15457 remain in the area of supervisory capacity and the Roma are the largest implementation of laws and regulations. minority group in Europe and This study assesses key issues and recommendations the major poverty risk group for development, and reviews the specific changes which in Central and Eastern are necessary in four areas: structural reforms, market Europe. Poverty rates from institutions, and infrastructure; accounting, transparency, recent World Bank poverty studies are striking. In and disclosure; market infrastructure; and credit Bulgaria, Roma were found to be ten times more likely to enhancements. be poor than ethnic Bulgarians. Roma also comprise an increasing share of the population in ECA countries, because of higher birth rates. Improving Health, Nutrition and Population These dynamics have gained international attention, Outcomes in Sub-Saharan Africa: The Role of the and the European Union accession process, in particular, World Bank has focused attention on the issue. Governments and By World Bank international institutions have been eager to support Price: $ 20.00 initiatives to address the needs of Roma. However, the English 270 pages lack of credible information on the actual living conditions Published December 2004 of Roma and the absence of program evaluations have ISBN: 0-8213-5963-0 provided substantial obstacles. SKU: 15963 This book brings together original sociological This book takes an in-depth research, evaluations of programs, and the first look at health, nutrition, and comparative cross-country household survey on population challenges ethnicity and poverty. It finds that Roma poverty is faced by sub-Saharan multi-faceted and can only be addressed by a Africa, particularly how comprehensive policy approach that attends to disease, malnutrition, and high fertility affect poverty all dimensions of Roma social exclusion. reduction. The authors contend that the World Bank It proposes an inclusive policy approach which has a comparative advantage in contributing within would expand and promote Roma involvement and four broad areas: participation in mainstream society, while maintaining i. macroeconomics and health, cultural and social identity and autonomy. Policy iii. multisectoral action for health, mechanisms include those which make existing policies more accessible to Roma and identifying iii. strengthening health systems, and areas where targeted initiatives are needed. iv. financing service delivery. They also address the opportunities and challenges within these four areas and conclude with suggestions on how the Bank can better operate within the sector and work effectively with partners. 12 The World Bank in India • March 2005 17 World Development Report 1978-2005 with Selected World Development Indicators 2004: India Project Documents Indexed Omnibus CD-ROM Edition Price: $ 500.00 Punjab State Roads Project English CD-ROM Date 15 February 2005 Published December 2004 Project ID P090585 ISBN: 0-8213-5739-5 Report No. AB1240 SKU: 15739 (Project Information Document) The World Development Report, published by the Third Tamil Nadu Urban Development Project World Bank every year (TNUDP III) since 1978, contains a wealth of information on the Date 14 February 2005 economic and social state of the world. This omnibus Project ID P083780 CD-ROM edition includes the text of all 27 editions, Report No. AB1330 (Project Information Document) from 1978 to 2005. Contents are fully indexed and AC1231 (Integrated Safeguards Data Sheet) cross-referenced for easy searching across the volumes in the archives. Third Tamil Nadu Empowerment and Poverty The CD-ROM includes selected indicators from Reduction Project World Development Indicators 2004. Published Date 6 February 2005 annually by the World Bank, World Development Project ID P079708 Indicators provides a comprehensive range of Report No. AB1361 (Project Information Document) statistical indicators for more than 200 economies. AC1256 (Integrated Safeguards Data Sheet) The selected indicators in this reference tool have many display options. Data can be exported for use Karnataka Municipal Reform Project in other applications, such as spreadsheets and databases.India Project Documents. Date 31 January 2005 Project ID P079675 Report No. AB1320 (Project Information Document) AC1223 (Integrated Safeguards Data Sheet) E1075 (Environmental Assessment, Vol. IV, V) Mumbai Urban Transport Project: Processing of Bank Group recognized for its additional Requests for Inspection related to the leadership role in knowledge Project management and road safety Date 28 December 2004 Project ID P050668 T he Bank Group has been recognized twice recently by international organizations for the excellence of its work. Report No. 31035 (Inspection Panel Report and Recommendation) Assam Rural Infrastructure and Agricultural For the fifth consecutive year, the Bank Group Services Project has been named as one of the world’s top 20 Most Admired Knowledge Enterprises. The award Date 23 December 2004 was made by Teleos, an independent knowledge Project ID P010522 management and intellectual capital research Report No. 30946 (Implementation Completion Report) company. The Bank Group is the only non-private sector company to have made the list this year. Maharashtra Water Sector Improvement Project As well, the Bank Group, in conjunction with Date 17 December 2004 the World Health Organization, has won the Project ID P084790 prestigious Prince Michael International Road Report No. AB1134 (Project Information Document) Safety Award. The awards are given each year to recognize outstanding contributions to improving National Cyclone Risk Mitigation Project road safety. Date 16 December 2004 Project ID P092217 The prize for the Bank Group and WHO was Report No. AC1193 (Integrated Safeguards Data Sheet) given for producing the first World Report on Road Traffic Injury Prevention, a landmark study that Second Reproductive and Child Health Project details the scale of the road safety problems facing the world, particularly the developing Date 10 December 2004 countries. Project ID P075060 Report No. AB1265 (Project Information Document) 12 18 The World Bank in India • March 2005 WB Policy Research Working Papers 3524 3511 Sowing and Reaping: Institutional Quality and Project Bank Privatization and Performance: Empirical Outcomes in Developing Countries Evidence from Nigeria By David Dollar and Victoria Levin By Thorsten Beck, Robert Cull and Afeikhena Jerome 3523 3510 School Meals, Educational Achievement, and School Measuring Empowerment in Practice: Structuring Competition: Evidence from a Randomized Evaluation Analysis and Framing Indicators By Michael Kremer and Christel Vermeersch By Ruth Alsop and Nina Heinsohn 3522 3509 China’s Employment Challenges and Strategies after Dynamic Cities and Creative Clusters the WTO Accession By Weiping Wu By Douglas Zhihua Zeng 3508 3521 The Political Economy of Health Services Provision Religious School Enrollment in Pakistan: and Access in Brazil A Look at the Data By Andrew Sunil Rajkumar, Maureen L. Cropper By Tahir Andrabi, Jishnu Das, Asim Ijaz Khwaja and and Ahmed Mushfiq Mobarak Tristan Zajonc 3507 3520 Innovative Tokyo Environment as Cultural Heritage: The Armenian By Kuniko Fujita and Richard Child Hill Diaspora’s Willingness-to-Pay By Benoît Laplante, Craig Meisner and Hua Wang 3506 A Macroeconomic Framework for Quantifying Growth 3519 and Poverty Reduction Strategies in Niger How Do Differing Standards Increase Trade Costs? By Nihau Bayraktar and Emmanuel Pinto Moreira The Case of Pallets By Enrique Aldaz-Carroll and Gael Raballand 3505 Are Foreign Investors Attracted to Weak 3518 Environmental Regulations? Evaluating the Evidence The Role of Importers and Exporters in the from China Determination of the U.S. Tariff Preferences Granted By Judith M. Dean, Mary E. Lovely and Hua Wang to Latin America By Peri Silva 3504 Unemployment and the Earnings Structure in Latvia 3517 By Mihails Hazans Trade Liberalization and the Politics of Financial Development 3503 By Matias Braun and Claudio Raddatz Lasting Local Impacts of an Economywide Crisis By Michael M. Lokshin and Martin Ravallion 3516 Sustainability of Microfinance Self Help Groups in 3502 India: Would Federating Help? Access to Capital in Rural Thailand: An Estimated By Ajai Nair Model of Formal versus Informal Credit By Xavier Gine 3515 Reforms and Infrastructure Efficiency in Spain’s 3501 Container Ports Telecommunications Reform within Russia’s By Lourdes Trujillo and Maria Manuela Gonzalez Accession to the World Trade Organization Serrano By Jesper Jensen, Thomas F. Rutherford and David G. Tarr 3514 Infrastructure Performance and Reform in Developing 3500 and Transition Economies: Evidence from a Survey of Revenue and the Fiscal Impact of Trade Productivity Measures Liberalization: The Case of Niger By Lourdes Trujillo, Antonio Estache and Sergio By Ali Zafar Perelman 3499 3513 Agriculture and National Welfare Around the World: How Concentrated are Global Infrastructure Markets? Causality and International Heterogeneity since 1960 By Daniel A. Benitez and Antonio Estache By Claudio Bravo-Ortega and Daniel Lederman 3512 3498 Policy Mix, Public Debt Management, and Fiscal Duty Drawbacks, Competitiveness, and Growth: Are Rules: Lessons from the 2002 Brazilian Crisis Duty Drawbacks Worth the Hassle? By Santiago Herrera By Elena Ianchovichina 12 The World Bank in India • March 2005 19 3497 3484 What Does Regional Trade in South Asia Reveal The Relative Richness of the Poor? Natural about Future Trade Integration? Some Empirical Resources, Human Capital, and Economic Growth Evidence By Claudio Bravo-Ortega and Jose de Gregorio By Nihal Pitigala 3483 3496 Parental Education and Children’s Schooling What Factors Influence World Literacy? Is Africa Outcomes: Is the Effect Nature, Nurture, or Both? Different? Evidence from Recomposed Families in Rwanda By Dorte Verner By Damien de Walque 3495 3482 Does Asymmetric Information Cause the Home Outgrowing Resource Dependence: Theory and Equity Bias? Some Recent Developments By Claudio Bravo-Ortega By Will Martin 3494 3481 Small-Scale Irrigation Dams, Agricultural Production, Financial Dependence, Banking Sector Competition, and Health: Theory and Evidence from Ethiopia and Economic Growth By Lire Ersado By Stijn Claessens and Luc Laeven 3493 3480 The Clash of Liberalizations: Preferential versus Capital Accumulation and Resource Depletion: Multilateral Trade Liberalization in the European A Hartwick Rule Counterfactual Union By Kirk Hamilton, Giovanni Ruta and Liaila Tajibaeva By Baybars Karacaovali and Nuno Limao 3479 3492 Why Should We Care about Child Labor? The How Fair is Workfare? Gender, Public Works, and Education, Labor Market, and Health Consequences Employment in Rural Ethiopia of Child Labor By Agnes R. Quisumbing and Yisehac Yohannes By Rajeev H. Dehejia, Kathleen Beegle and 3491 Roberta Gatti Use of the Formal and Informal Financial Sectors: Does Gender Matter? Empirical Evidence from Rural 3478 Bangladesh Do Services and Transfers Reach Morocco’s Poor? By Signe-Mary McKernan, David Moskowitz and Evidence from Poverty and Spending Maps Mark M. Pitt By Dominique van de Walle 3490 3477 Roads Out of Poverty? Assessing the Links between Agglomeration, Transport, and Regional Development Aid, Public Investment, Growth, and Poverty in Indonesia Reduction By Uwe Deichmann, Kai Kaiser, Somik V. Lall and By Pierre-Richard Agénor, Karim El Aynaoui and Zmarak Shalizi Nihal Bayraktar 3476 3489 Firm Financing in India: Recent Trends and Patterns Environmental Factors and Children’s Malnutrition By Inessa Love and Maria Soledad Martinez Peria in Ethiopia 3475 By Patricia Silva Using an Asset-Based Approach to Identify Drivers 3488 of Sustainable Rural Growth and Poverty Reduction Well-Being during a Time of Change: Timor-Leste in Central America: A Conceptual Framework on the Path to Independence By Paul Siegel By Kaspar Richter 3474 3487 Choosing Formulas for Market Access Negotiation: Child Labor, School Attendance, and Indigenous Efficiency and Market Access Considerations Households: Evidence from Mexico By Vlad Manole, Will Martin and Joseph Francois By Harry Anthony Patrinos, Rosangela Bando and 3473 Luis F. Lopez-Calva Poverty Effects of Russia’s WTO Accession: Modeling 3486 ‘Real’ Households and Endogenous Productivity Localization and Corruption: Panacea or Pandora’s Effects Box? By Thomas F. Rutherford, Oleksandr Shepotylo and By Tugrul Gurgur and Anwar Shah David G. Tarr 3485 3472 Finance, Firm Size, and Growth Democracy, Credibility, and Clientelism By Thorsten Beck, Asli Demirgüç-Kunt, Luc Laeven By Philip Keefer and Razvan Vlaicu and Ross Levine 12 20 The World Bank in India • March 2005 3471 For Successful Enterprise Do Government Policies that Promote Competition The World Challenge Competition, brought to you by Encourage or Discourage New Product and Process Newsweek & BBC World, in association with Shell, is a Development in Low and Middle-Income Countries? competition aimed at finding individuals or groups from By George Clarke around the world who have shown enterprise and 3470 innovation at a grassroots level. We want to hear about PPI Partnerships versus PPI Divorces in Developing the people whose projects are making a difference to Countries (Or are We Switching from PPPI to PPDI?) communities. It could be you or someone you know. By Antonio Estache The World Challenge is all about global involvement, 3469 casting a net for ideas from individuals or groups Regulation and Macroeconomic Performance deserving recognition. We are looking for your By Norman V. Loayza, Ana Maria Oviedo and nominations for innovative projects or ideas that are Luis Serven benefiting communities socially, environmentally or 3468 financially. Infrastructure Services in Developing Countries: Deadline for submission April 4, 2005 Access, Quality, Costs, and Policy Reform By Cecilia Briceno, Antonio Estache and Prize: The Winner will receive from Shell a US$20,000 Nemat T. Shafik grant to benefit their project. One representative of the 3467 project will be flown to London to receive the award. Economic Growth, Income Distribution, and Poverty For further details, go to in Poland during Transition http://www.theworldchallenge.co.uk/ By Jos Verbeek, Pierella Paci and Marcin J. Sasin 3466 Building a Clean Machine: Anti-Corruption Coalitions Latest on the Web and Sustainable Reform by Michael Johnston and Sahr J. Kpundeh A range of online tsunami-related information and 3465 knowledge-resources are available at various World Economic Geography: Real or Hype? Bank sites. By Jun Koo and Somik V. Lall A portal on the tsunami and the Bank’s 3464 reconstruction effort is available at the World Bank’s Microeconomic Evidence of Creative Destruction website at www.worldbank.org/tsunami in Industrial and Developing Countries By John C. Haltiwanger, Eric Bartelsman and This includes a detailed report on the Bank’s Stefano Scarpetta response to the disaster, available in PDF format http://siteresources.worldbank.org/COUNTRIES/ 3463 Resources/tsunamireport-020205.doc Employment Regulations through the Eyes of Employers: Do they Matter and How Do Firms Respond to Them? By Gaelle Pierre and Stefano Scarpetta 3462 The Returns to Participation in the Nonfarm Sector in Rural Rwanda By Stefano Paternostro, Andrew Dabalen and Gaelle Pierre Competitions For Youth: The World Bank invites you to participate in an International Essay Competition by responding to the two following questions: Other allied resources include: ● What are the biggest obstacles you face in your ● Hazard Risk Management daily life? The mission of the World Bank is to fight poverty. ● What practical solutions would you propose to build An important part of this mission is providing a secure future for yourself and others? assistance to prepare for and recover from natural or Deadline for submission 15 April 2005 manmade disasters that can result in great human and Prize: $5.000 for the winner!!! Several other cash prizes economic losses. Indeed, developing countries suffer For further details, go to the greatest costs when disaster hits: more than 95 http://www.essaycompetition.org/ percent of all deaths caused by disasters occur in The World Bank in India • March 2005 12 21 developing countries; and losses due to natural which opened the first High Level Round Table on disasters are 20 times greater (as a percent of GDP) ‘Disaster Risk: The Next Development Challenge’. in developing countries than in industrial countries. Other panelists in the Roundtable all gave consistent messages regarding the urgent need to mainstream Moreover, poorly planned development can turn a disaster risk reduction into development activities. recurring natural phenomenon into a human and economic disaster. Allowing dense populations on a Presentations made by the World Bank delegation floodplain or permitting poor or unenforced building are available at http://www.worldbank.org/hazards/ codes in earthquake zones is as likely as a natural news/kobe.htm. event to cause casualties and losses. Similarly, For more information on the sessions, please refer to allowing the degradation of natural resources the WCDR website at http://www.unisdr.org/wcdr. increases the risk of disaster. In addition to these activities, the World Bank In this connection, the World Bank’s Hazard collaborated with several of its partners to present a Management Unit aims to reduce human suffering and paper entitled, ‘Disaster Risk Management in a economic losses caused by natural and technological Changing Climate on behalf of the Vulnerability and disasters. It does this by helping the World Bank Adaptation Resource Group (VARG). This can also be provide a more strategic and rapid response to accessed online at the Bank’s Hazards Risk disasters, and promoting the integration of Management site. disaster prevention and mitigation efforts into the range of development activities. Details available at The World Bank also participated in the Pro Vention http://www.worldbank.org/hazards/ Consortium launch of the second round of applied grants for disaster risk reduction. This program supports young people from developing countries who are interested in conducting disaster management- related research. Details at http://www.proventionconsortium.org/ ● World Conference on Disaster Reduction Kobe, Japan; 18-22 January, 2005 Taking place less than one month after the Indian Ocean tsunami, the Conference had a very high profile and was attended by over 4,000 participants from 168 ● Lessons from Natural Disasters from the Bank’s countries, international agencies, media organizations, Operations Evaluation Department and NGOs. The Conference reviewed 10 years of disaster reduction activities since the first World The Operations Evaluation Department (OED) is an Conference on Natural Disaster Reduction held in independent unit within the World Bank. It prepared Yokohama in 1994. It also organized special sessions this note following the earthquake and tsunami disaster to discuss the establishment of a tsunami early of December 26, 2004, to gather salient findings and warning system for the Indian Ocean. lessons from project evaluations conducted over the past decade. Natural disasters are also the subject of The Conference had three major components: an ongoing thematic evaluation that will be published i. Inter-governmental process in 2006. The note is available in PDF format at ii. Thematic sessions in five areas: Governance, http://www.worldbank.org/oed/disasters/ institutional and policy frameworks for risk reduction; lessons_from_disasters.pdf Risk identification, assessment, monitoring and early ● Sustaining Asian Microfinance (CGAP) warning; Knowledge, innovation and education to build As the communities most affected by the recent a culture of safety and resilience; Reducing the devastating tsunami courageously begin to rebuild their underlying risk factors; Preparedness for effective lives, microfinance institutions (MFIs) can play a response powerful part in the path to recovery. Since the iii. Public Forums immediate aftermath of the tragedy, MFIs have been The World Bank was represented in each of the tirelessly providing and coordinating emergency relief, components and thematic clusters. President and a few are beginning to help local communities Wolfensohn provided a pre-taped message, reconstruct homes and return to economic activity. 12 22 The World Bank in India • March 2005 CGAP, a consortium of 28 public and private boldest and most ambitious initiatives to build local development agencies (including the World Bank) institutions of democratic governance ever undertaken working together to expand access to financial in India. services for the poor in developing countries. CGAP To what extent did the Campaign achieve its aims? has set out guidelines intended to help MFIs provide This presentation summarizes the findings from a the appropriate range of emergency and longer-term detailed empirical study of the Campaign s impact. assistance to their clients, while helping both MFIs Using extensive survey data collected in 2002 from a and donors ensure that the ultimate mission of sample of 72 randomly selected gram panchayats, the the MFI – to be a sustainable provider of financial study traces the Campaign s impact along multiple services – is not compromised. Any MFI involved in dimensions – from the development of infrastructure tsunami reconstruction can get information about and delivery of public services to assistance for the the challenges it is facing by contacting poor, and democratic deepening. cgap@worldbank.org The study, funded by the Ford Foundation, was a joint CGAP guidelines are available at effort of the Center for Development Studies in http://www.cgap.org/tsunami.html Thiruvananthapuram, Kerala, and faculty at Columbia University in New York. The presentation is given by Shubham Chaudhuri, one of the principal investigators of the study, who has since moved to the World Bank. Fiscal Decentralization To Rural Governments In India By Roy Bahl, Praful Patel, Sudha Pillai, Geeta Sethi (1:02:00 minutes) On December 7, 2004 the World Bank InfoShop hosted an event to launch the publication of the report Fiscal Decentralization to Rural Governments in India. This World Bank study presents a case for fiscal decentralization to local governments (panchayats) in India. The report argues that effective decentralization can strengthen panchayat-level governance and improve the performance and delivery of critical Latest on the B-SPAN functions assigned to them. With a focus on rural India, this report uses case studies from Karnataka and Kerala to review panchayat finances and make B-SPAN is an Internet-based broadcasting service recommendations for effective governance. that presents World Bank seminars, workshops, and conferences on a variety of sustainable development Watch a webcast of the seminar on this study. and poverty reduction issues. It can be accessed at Participants include Praful Patel, the Bank’s Vice http://info.worldbank.org/etools/bspan President for the South Asia Region, Geeta Sethi, Senior Economist for the South Asia Region and author Building Democracy: The People’s Campaign For of the study, Roy Bahl, Dean of the Andrew Young Decentralized Planning In Kerala, India School of Policy Studies at Georgia State University By Adolfo Brizzi, Shubham Chaudhuri, Anwar Shah, and a collaborator on the report, Sudha Pillai, Secretary Parmesh Shah (1:23:00 minutes) of Local Governments for the Government of India. Shanta Devarajan, Chief Economist for the Bank’s In 1996, a coalition of left parties returned to power in South Asia Region, moderated the session. the state of Kerala and immediately fulfilled one of its most important campaign pledges by launching the Other interesting B-Span topics include: People’s Campaign for Decentralised Planning. All Global Dialogue On Scaling Up Poverty Reduction 1,214 local governments in Kerala – municipalities and By Saleh Afif, Frannie Léautier, Mohini Malhotra, the three tiers of rural local government, district, block Patricia Medrano, Mauricio Olivarria and gram panchayats – were given new functions and (1:51.000 minutes) powers of decision-making, and were granted discretionary budgeting authority over 35-40 percent Global Partners Forum For Orphans And Vulnerable of the state’s developmental expenditures. Children Living In A World With HIV And AIDS (1:40:55 minutes) The Campaign, however, attempted more than just a devolution of resources and functions. Local Empowered Participatory Governance governments were not only charged with designing and By Robert Chase, Archon Fung implementing their own development plans, they were (1:31:25 minutes) mandated to do so through an elaborate series of State-Building: Governance And World Order nested participatory exercises in which citizens were In The 21st Century With Francis Fukuyama given a direct role in shaping policies and projects. 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