INTEGRATED SAFEGUARDS DATA SHEET RESTRUCTURING STAGE Note: This ISDS will be considered effective only upon approval of the project restructuring . Report No.:ISDSR22050 Date ISDSPrepared/Updated: 07-Jul-2017 I. BASIC INFORMATION 1. Basic Project Data Country: Bhutan Project ID: P123820 Project Name: Remote Rural Communities Development Project (P123820) Task Team Leader(s): Winston Dawes Estimated Appraisal 17-Aug-2012 Estimated Board 02-Oct-2012 Date: Date: Managing Unit: GFA06 Financing Specific Investment Instrument: Loan Is this project processed under OP 8.50 (Emergency Recovery) or OP No 8.00(Rapid Response to Crises and Emergencies)? Financing (In USD Million) Total Project Cost: 9.00 Total Bank Financing: 9.00 Financing Gap: 0.00 Financing Source Amount BORROWER/RECIPIENT 0.00 International Development Association (IDA) 9.00 Total 9.00 Environmental Category: B - Partial Assessment Is this a Repeater project? No 2. Current Project Development Objectives The project development objective is to increase agriculture productivity and access to community assets in remote rural areas by improving access to markets, irrigation, agricultural technologies and community infrastructure. Proposed New PDO (from Restructuring Paper) The project development objective is to increase agriculture productivity and access to community assets in remote rural areas by improving access to markets, irrigation, agricultural technologies and community infrastructure. 3. Project Description The project will consist of three components. Page 1 of 10 Component A. Rural Infrastructure (USD6.2 million). The focus of this component is to connect the communities to larger roads and regional markets and to improve production potential through improved availability ofirrigation. This component would consist of two main sub-components: A.1. Rural accessibility (USD3.4 million). This sub-component will finance farm road development, consisting of new farm road construction, landslide protection, and river crossing structures. Specifically, it would fund the following activities: (a) New farm road construction. This subcomponent will include 34 km of farm roads chosen from the list of farm road proposals totaling 87.5 km which remained unfinanced under the Tenth FYP. The roads are located in Haa, Dagana, Samtse, Trongsa, and Wangdue dzongkhags. This sub-component will also fund low cost causeways (concrete or stone paved), timber/concrete bridges, or Bailey bridges. (b) Landslide protection structures. This subcomponent will finance protective works addressing landslide risks and would respond to damage from future events. It will include a provisional budget to cover civil works against potential landslides in locations to be identified during the project life. Such locations would become apparent after one or two monsoon exposures. 12. A.2. Irrigation (USD2.7 million). This sub-component will finance: (a) Irrigation infrastructure rehabilitation and modernization. The project will rehabilitate about 67 schemes serving an area of about 1,000 hectares. (b) High efficiency irrigation development. The project will fund modernization of a existing systems covering about 60 ha. The high efficiency irrigation development will include pilots to test new technologies such as gravity-fed low pressure sprinkler, micro-jets, and drip systems. (c) Water Storage Structures. The project will support the installation of two storage structures in each district, where feasible. (d) Engineering Support. During the first years of project implementation, the project will provide intermittent support by an experienced regional hydraulic or irrigation engineer. (e) Water User Associations (WUA) Training and Support. The project will provide targeted training and support required for the WUAs to undertake these duties. Component B. Community, Marketing and Productive Infrastructure (USD3.1 million). This component would cover investments in marketing and post-harvest infrastructure, critical community-level infrastructure, and investments identified by producers to increase agricultural productivity. It would consist of two sub-components: B.1. Establishing community and marketing infrastructure (USD1.1 million). Although specific investment needs cannot be determined prior to implementation, it is expected that this component will support development of basic rural infrastructure and related technical assistance for drinking water supply systems, rural sanitation infrastructure, electrification, foot bridges, school building construction and repair, small- scale agriculture production and marketing infrastructure, and improved housing. The sub-component will be implemented in the poorest and most disadvantaged geogs within the project area with a poverty rate of over 50%. These include Biru, Bangra, Denchukha, Dorokha, Dungtoe, Namgaychoeling, Tading geogs in Samtse dzongkhag and Getana, Lokchina geogs in Chukkha dzongkhag. It is expected that between 60 and 100 sub- projects will be completed over a three-year period. B.2. Improving Productive Assets of Existing Producer Groups (USD2.0 million). The interventions supported by this sub-component would address major productivity constraints and enhance farm income of Page 2 of 10 participating producers in a differentiated way, depending on the specificity of each project location. Specifically, the project will finance the rehabilitation of declining citrus orchards and assist producers with replanting of cardamom plantations that have been devastated by fungal and viral diseases in recent years. Such investments will address the needs of about 2,100 households. Project resources will be also provided to poultry groups organized around about 240 farming households, to enable an increased production of eggs that are in high demand by the communities. Investment packages will be provided to organized groups on a cost-sharing basis, along the lines of existing schemes that are promoted by the MOAF through the geog RNR staff in many parts of the country. Similarly, and also on a cost-sharing basis, over 25 Community Forest Groups and about 1,500 households will receive project assistance and support for their wood and non-wood-forest products (NWFP) production and value addition activities. Finally, the project will support investments of tested wildlife damage mitigation and sustainable land management technologies (developed by the Sustainable Land Management Project) in all project dzongkhags. While this intervention is estimated to benefit directly over 1,500 households, the population in the surrounding communities will also be aware of such technologies. Component C: Project Management and Institutional Strengthening (USD0.5 million). This component supports project management, including the monitoring and evaluation functions of the project. It covers: (a) technical and financial management, (b) procurement, and (c) supervision of compliance with environmental and social safeguards. This component also would strengthen the capacity of the MoAF to effectively coordinate implementation and provide procurement support to local communities as needed. This component also would support mid-term and end-of-project project monitoring surveys that would provide project performance information at the activity, output, and outcome levels to meet the requirements of the existing RGoB monitoring system and the PLAMS (Planning and Monitoring System). 4. Project location and Salient physical characteristics relevant to the safeguard analysis (if known) The project will benefit about 6,440 households living in rural areas in Bhutan. As part of the RGoB?s general drive to increase the efficiency and effectiveness of public expenditure, poverty mapping will be used as a means to target project resources to the most remote and poorest rural areas in the country. Thus, project activities will be concentrated in 26 geogs in six dzongkhags (Samtse, Haa, Chhukha, Trongsa, Dagana and Wangdue) in Western and Southern Bhutan, all of which have significant concentrations of poverty. Within these dzongkhags, project activities will focus on geogs with a large number of poor and will ensure participation of women. Based on the Rural Poverty Assessment in Bhutan, the 2010 poverty estimate in the project area (26 selected geogs) is 46.2%, about double the national level (23.0 %) Women represent about 41% of all people employed in agriculture in the project area. About 29percent of all households residing in the project area are headed by women (Population and Housing Census, 2005). 5. Environmental and Social Safeguards Specialists on the Team Nadia Sharmin( GEN06 ) Rekha Shreesh( GSU06 ) 6. Safeguard Policies Triggered? Explanation (Optional) Environmental Assessment OP/BP 4.01 Yes This is applicable given the emphasis on rural infrastructure development and to assess the risk it poses on land, water, vegetation and cultural property. An Environmental Management Framework (EMF) has been Page 3 of 10 developed to ensure all environmental impacts are considered in planning, implementation and monitoring of project activities. For the infrastructure including farm road and irrigation schemes, the EMF includes provision for undertaking environmental screening and limited EA if necessary (Full EA or EIA required activity is not eligible). Environmental codes of practices as outlined in the Environmental Friendly Road Construction guidelines that have been developed by the Royal Government of Bhutan will be used. In terms of the community components, this Policy / EMF is also relevant for the management of community level natural resources within the project areas.. Screening Checklist for identifying and addressing potential environment impacts have been developed and staff will be trained to use these during the community planning process. Natural Habitats OP/BP 4.04 No This is likely not applicable. Although there is a national park and known bird habitat/high biodiversity area, activities located in those areas or dependent on resources from them are not-eligible. The infrastructure activities will be small-scale. These activities are highly unlikely to cause significant conversion or degradation of natural habitats. Forests OP/BP 4.36 Yes Some of the infrastructure to be supported under the project may be located in the forest area. The project envisages community and private forests and some limited afforestation of degraded areas to curb land degradation. However, the project will not engage in commercial forestry activities. Environmental screening/ assessment will address any issue related to forest. Pest Management OP 4.09 Yes The project might involve the procurement and use of pesticides on a limited scale to enhance crop production in farmer agricultural lands. However, the procurement and distribution of pesticides in Bhutan is well controlled through a centralized system and there will be no procurement of pesticides classified as Class Ia, Ib and II by WHO. Efforts would be made to use IPM methods to the extent possible and practical. Physical Cultural Resources OP/BP 4.11 No EMF conclusion is that there are number of cultural and religious sites of local significance Page 4 of 10 in all the project Geog. Chances of adverse impacts, which may be limited in scale and nature, on them may not be ruled out due to construction activities. Activities within 50 of nationally or internationally renowned PCR site is in the negative list, but activities may be permitted near the local cultural sites. Environmental screening/ assessment will address risks to the cultural/religious sites, if any. Indigenous Peoples OP/BP 4.10 No There are no separate disadvantaged ethnic groups different from the dominant population who will be adversely affected by the project. However, there are vulnerable households across ethnic groups. A Vulnerable Community Development Framework has been developed that includes special measures to protect socially and economically vulnerable households such as women headed households and people living in extreme poverty. Involuntary Resettlement OP/BP 4.12 Yes The Project proposes to finance small, community-level infrastructure investments, including irrigation and water harvesting/ management structures, rural access roads, and community facilities (sale centers, packaging houses, storage facilities etc.). These investments may require lands for their construction. The impacts are expected to be marginal. In the event that minor land acquisition (most likely to be only for the farm roads) is unavoidable, a Resettlement Policy Framework (RFP) has been prepared that lays out principles, entitlement policies and planning steps to address such impacts. Safety of Dams OP/BP 4.37 No Negative list of subproject/ activity include any water retaining structure or barrier across stream 10 m or more in height or that pose significant disaster risks if it breaks. Projects on International Waterways OP/BP Yes The project area covers existing irrigation 7.50 network which draws water from rivers going through Bhutan's territory and then flow to India. Thus the project triggers World Bank OP/BP 7.50 (Projects on International Waterways). The proposed investments under the project are mainly for renovation of irrigation canals, and improvements of drainage infrastructure, which are not expected to change the volume of extraction/discharge water or quality of water of these rivers, but Page 5 of 10 rather will lead to more effective irrigation and drainage of the water. Thus the project implementation would improve the transboundary water resources use and their quality. Based on mentioned, the project team is processing an exception to the notification requirement under paragraph 7(a) of the Policy. Projects in Disputed Areas OP/BP 7.60 No II. Key Safeguard Policy Issues and Their Management A. Summary of Key Safeguard Issues 1. Describe any safeguard issues and impacts associated with the Restructured project. Identify and describe any potential large scale, significant and/or irreversible impacts: The project is expected to have positive environmental and social impacts by enabling rural communities to use land and other resources in a more sustainable manner and help them achieve higher incomes through enhanced agricultural productivity and improved marketing. However, limited environmental impacts such as landslides/ erosion, loss/degradation of forests/vegetation, workers? and community health safety and sanitation, and construction period disturbances are possible from the community infrastructures. These impacts are likely to be limited to site and its immediate surrounding and can be managed through readily available measures. The project will follow a participatory and inclusive process of direct and systematic participation of beneficiary communities in the selection, implementation and monitoring of project investments. Consultations with local communities indicate a strong support for the project, in particular for proposals to improve agricultural productivity and marketing, and improve access to markets. The identified main positive social impacts of the project are improved investments in agriculture and land resources, increased market access and credit facilities and improved water delivery and management at the farmland. Given that investments would be small, localized nature, the project will not result in significant adverse social impacts, such as physical relocation of people or the large scale acquisition of private lands. The proposed investments will have their footings on the ground and will need lands. However, the land needs are expected to be small in quantity and the impacts of such marginal. To the extent possible, alternative designs and alignment (in particular for roads and irrigation facilities) will be considered to avoid land acquisition and minimize adverse social impacts. 2. Describe any potential indirect and/or long term impacts due to anticipated future activities in the project area: No highly significant long term indirect impact is expected from the project. One potential long term or indirect impact of the road construction, though may not be highly significant, could be increased demographic pressure on resources hitherto isolated from human settlement. The Environmental Screening and/or EMP of each subproject or activity or environmental clearance terms & condition will have mitigation specified to address negative impacts that could arise from enhanced resource use and access. It would also include special measures to ensure slope stabilization of the farm roads. Given the nature of the types of investments to be supported by the project, it is anticipated that there will be minimum cumulative social and environmental adverse impacts, since the screening process will eliminate sites that may result in any serious impacts. 3. Describe any project alternatives (if relevant) considered to help avoid or minimize adverse impacts. One option considered was to build roads with minimum of costs, but the long term environmental impacts of building such roads would have been enormous. An alternative was to build roads based on the concept of Page 6 of 10 ?environmentally-friendly construction? (EFRC) methods. While this originally took time to be understood and adopted, it is now applied to all feeder roads in Bhutan. Evidence suggests that compliance with EFRC increases up-front costs of investment, but minimizes environmental damage and decreases maintenance costs significantly. The proposed project will adopt EFRC for farm road construction and higher construction costs are built into project costing. RGoB recently revised Farm Road Policy which increased the Farm Road Unit cost from Nu 1.2 million per km to Nu 2.6 million per km, and the revised Irrigation Policy permits use of contractor, for more skilled works, in the community irrigation schemes. These revisions make it possible to use environmentally friendly construction techniques/ methods. 4. Describe measures taken by the borrower to address safeguard policy issues. Provide an assessment of borrower capacity to plan and implement the measures described. RGoB has prepared an Environmental Management Framework (EMF) for the project in order to screen/ assess, use appropriate mitigations, and manage any environmental issue resulting from the small-scale interventions spread far and wide across six districts (26 Geogs). The EMF requires, each investment to be subjected to screening and, if required, preparation of an Environmental Management Plan (EMP), obtaining No Objection letter from competent agency, The subproject/ activity will be subjected to periodic compliance and final monitoring. Memorandum of Understanding will be agreed upon by each of the stakeholders ? Community representatives (i.e. Water User Committee), and geog and dzongkhag representatives. The implementation of the EMP and the Memorandum of Understanding will be periodically monitored by the community and Project Management Team, and/or by NECS/DEC , PPD/MoAF. A subproject's EMP consists of the set of mitigation, monitoring, and institutional measures to be taken during implementation and operation to eliminate adverse environmental and social impacts, offset them, or reduce them to acceptable levels. The plan also includes the actions needed to implement these measures. Assessment made during EMF preparation indicates there is general awareness about environmental requirements among the staff of dzongkhag and ministry, but their ability to perform is constrained by the lack of human and financial resources, and by lack of specific skills. The EMF has included a plan for addressing this issue in the context of the project, and suggests the following measures: provision of additional human resources (on need basis), orientations and training tailored to the specific needs, engaging private sector or NGO, and supporting NECS and/or PPD/MoAF in conducting environmental due diligence of the project. The project follows a programmatic fashion. A Social Management Framework (SMF) has been prepared for this project. The SMF includes a) a Land Acquisition And Rehabilitation Framework that lays out the principles, entitlement policies and compensation as well as resettlement planning process, b) a Vulnerable Community Development Framework that lays out the objectives, principles, identification of such households and development interventions, c) a gender and social inclusion framework that describes its principles, approach and interventions, d) a Community Consultation and participation framework, e) project planning procedures, f) institutional arrangements and g) grievance redress as well as monitoring mechanisms. In addition, to ensure transparency and equity, a Process Framework (PF) for the participation of local communities in the implementation of community activities has been developed to detail the principles and processes for assisting communities to manage any negative potential impacts. Since the exact social impacts of access will only be identified during project implementation, the Process Framework will ensure that mitigation of any negative impacts deriving from development activities or potential restriction access by communities to natural resources will be based on a participatory process involving all affected stakeholders, and on their consent regarding the type of mitigation measures to compensate any loss of income or the scale of restriction of resource use that are needed. Any desired changes by the communities in the ways in which local populations exercise customary tenure rights in the project sites will not be imposed on them, but will Page 7 of 10 emerge for a consultative process satisfactory to the World Bank. Annual project work plans including management arrangements for community access to resources in project sites and associated mitigation measures will require World Bank agreement. Field based consultations also indicated that there were no social groups present in these communities with a social and cultural identity distinct from the dominant society that would make them vulnerable to being disadvantaged in the development process. Since project activities are based on local demands and identified through a highly participative and inclusive process, the project will ensure that vulnerable groups are involved in decision making throughout the planning and implementation phase of the project, and that these groups will be provided assistance in accordance to their priorities. To effectively monitor project impacts on the vulnerable, the socioeconomic baseline established for the project will include specific data on representative vulnerable households (e.g. women and women headed households, the most poor, farmers with marginal land holdings and the landless). 5. Identify the key stakeholders and describe the mechanisms for consultation and disclosure on safeguard policies, with an emphasis on potentially affected people. The key stakeholders include communities/ users, geog, chiog, dzongkhag, and MoAF. Local-level consultations were carried out with primary stakeholders, specifically the local communities, Geog Tshogde (GT) members and Geog Renewable Natural Resources (RNR) extension agents. The consultations with local communities involved group discussions and household interviews. During the field consultation, special attention was given to including women and vulnerable people. At the central level, consultative meetings were held with the representation from all the major government agencies: Ministry of Finance, Ministry of Works and Human Settlement; Ministry of Trade and Industry; National Environment Commission Secretariat; Bhutan Development Bank Limited, and the Ministry of Agriculture and its Departments of Agriculture, Forestry, and Livestock. A formal stakeholder consultation, participated by government agencies and NGOs, was held in Thimphu on May 17, 2012. Annex 7 of EMF summarize the consultation feedbacks. The project is based on a strong participatory approach in the selection, implementation, monitoring and operation and maintenance of project facilities through the direct participation of beneficiary communities. The SA (developed on the basis of consultation with affected communities) provides guidance on the overall consultation strategy and mechanisms to ensure community awareness and involvement in the project, as well as participatory monitoring and evaluation modalities. . B. Disclosure Requirements Environmental Assessment/Audit/Management Plan/Other Date of receipt by the Bank 03-Aug-2012 Date of submission to InfoShop 14-Aug-2012 For category A projects, date of distributing the Executive Summary of the EA to the Executive Directors "In country" Disclosure PHENVCTRY Bhutan 14-Aug-2012 Comments: PHENVCOMM Resettlement Action Plan/Framework/Policy Process Date of receipt by the Bank 03-Aug-2012 Date of submission to InfoShop 14-Aug-2012 "In country" Disclosure PHRESCTRY Bhutan 14-Aug-2012 Page 8 of 10 Comments: Pest Management Plan Was the document disclosed prior to appraisal? Y Date of receipt by the Bank 03-Aug-2012 Date of submission to InfoShop 14-Aug-2012 "In country" Disclosure PHPESTCTRY Bhutan 14-Aug-2012 Comments: PHPESTCOMM If the project triggers the Pest Management and/or Physical Cultural Resources policies, the respective issues are to be addressed and disclosed as part of the Environmental Assessment/Audit/or EMP. If in-country disclosure of any of the above documents is not expected, please explain why:: C. Compliance Monitoring Indicators at the Corporate Level PHCompliance OP/BP/GP 4.01 - Environment Assessment Does the project require a stand-alone EA (including Yes [X] No [] NA [] EMP) report? If yes, then did the Regional Environment Unit or Practice Yes [X] No [] NA [] Manager (PM) review and approve the EA report? Are the cost and the accountabilities for the EMP Yes [X] No [] NA [] incorporated in the credit/loan? PHCompliance OP 4.09 - Pest Management Does the EA adequately address the pest management Yes [X] No [] NA [] issues? Is a separate PMP required? Yes [] No [X] NA [] If yes, has the PMP been reviewed and approved by a Yes [] No [] NA [X] safeguards specialist or PM? Are PMP requirements included in project design?If yes, does the project team include a Pest Management Specialist? PHCompliance OP/BP 4.12 - Involuntary Resettlement Has a resettlement plan/abbreviated plan/policy Yes [X] No [] NA [] framework/process framework (as appropriate) been prepared? If yes, then did the Regional unit responsible for Yes [X] No [] NA [] safeguards or Practice Manager review the plan? Is physical displacement/relocation expected? Yes [] No [] TBD [] Is economic displacement expected? (loss of assets or Yes [] No [] TBD [] access to assets that leads to loss of income sources or other means of livelihoods) PHCompliance OP/BP 4.36 - Forests Has the sector-wide analysis of policy and institutional Yes [] No [] NA [X] issues and constraints been carried out? Does the project design include satisfactory measures to Yes [] No [] NA [X] overcome these constraints? Does the project finance commercial harvesting, and if so, Yes [] No [] NA [X] does it include provisions for certification system? PHCompliance OP 7.50 - Projects on International Waterways Have the other riparians been notified of the project? Yes [] No [X] NA [] Page 9 of 10 If the project falls under one of the exceptions to the Yes [X] No [] NA [] notification requirement, has this been cleared with the Legal Department, and the memo to the RVP prepared and sent? Has the RVP approved such an exception? PHCompliance Yes [X] No [] NA [] The World Bank Policy on Disclosure of Information Have relevant safeguard policies documents been sent to Yes [X] No [] NA [] the World Bank's Infoshop? Have relevant documents been disclosed in-country in a Yes [X] No [] NA [] public place in a form and language that are understandable and accessible to project-affected groups and local NGOs? PHCompliance All Safeguard Policies Have satisfactory calendar, budget and clear institutional Yes [X] No [] NA [] responsibilities been prepared for the implementation of measures related to safeguard policies? Have costs related to safeguard policy measures been Yes [X] No [] NA [] included in the project cost? Does the Monitoring and Evaluation system of the project Yes [X] No [] NA [] include the monitoring of safeguard impacts and measures related to safeguard policies? Have satisfactory implementation arrangements been Yes [X] No [] NA [] agreed with the borrower and the same been adequately reflected in the project legal documents? III. APPROVALS Task Team Leader(s): Name: Winston Dawes Approved By: Safeguards Advisor: Name: Maged Mahmoud Hamed (SA) Date: 10-Jul-2017 Practice Manager/Manager: Name: Date: Page 10 of 10