Page 1 INTEGRATED SAFEGUARDS DATA SHEET CONCEPT STAGE Report No.: AC5880 Date ISDS Prepared/Updated: 01/24/2011 I. BASIC INFORMATION A. Basic Project Data Country: India Project ID: P124614 Project Name: Rajasthan Agricultural Competitiveness Project Task Team Leader: Severin L. Kodderitzsch Estimated Appraisal Date: November 15, 2011 Estimated Board Date: February 15, 2012 Managing Unit: SASDA Lending Instrument: Specific Investment Loan Sector: General agriculture, fishing and forestry sector (60%);Agricultural marketing and trade (20%);Agricultural extension and research (10%);Animal production (10%) Theme: Rural services and infrastructure (70%);Rural markets (20%);Rural policies and institutions (10%) IBRD Amount (US$m.): 0.00 IDA Amount (US$m.): 150.00 GEF Amount (US$m.): 0.00 PCF Amount (US$m.): 0.00 Other financing amounts by source: BORROWER/RECIPIENT 50.00 Financing Gap 30.00 80.00 B. Project Objectives [from section 2 of PCN] The proposed Project Development Objective (PDO) is to demonstrate at scale the feasibility of a range of distinct agricultural development approaches integrating technology, organization, institution and market innovations across selected regions of Rajasthan # each marked by different agro-ecological, climatic, water resource and social conditions # capable of significantly increasing agricultural productivity and farmer incomes. C. Project Description [from section 3 of PCN] The guiding principles under the project are: (a) improved on-farm water use efficiency, reduced water-intensive cropping patterns, and using the resultant savings for economic purposes outside of agriculture in support the state#s water policy of reducing water consumption by the agricultural sector; (b) increased private sector participation in the development of value chains in processing and marketing in support of the state#s agro processing and agri-business policy; and (c) improved public sector capacity in delivering agriculture support services. The project Page 2 will be taken up in 4 to 5 regional clusters covering different agro-climatic conditions of the state and implement a location-specific menu of approaches and interventions. Selection of these geographical clusters will take into account, inter alia, drought-proneness, soil types, cropping pattern, sources of irrigation, marketing infrastructure, and livestock population. The beneficiaries of the project will primarily be smallholder farmers with actual or potential commercial outlook in the selected agro-climatic zones supported through collective action in achieving economies of scale. The project components will address capacity, access and participation-related issues by (i) incentivizing group formation among smallholder farmers (e.g. water user groups, ground water management communities, watershed groups) through specialized service providers; (ii) promoting farmer access to farm inputs, advisory services, product markets as well as agriculture insurances; and (iii) promoting gender-equitable practices in the sector. Component 1: Climate Resilient Agriculture (tentative cost: $130 m): This component will support climate-resilient approaches that allows for the sustainable use of the natural resource base through agricultural and livestock production systems aiming to increase long term productivity and farm incomes in an environment marked by increased climate and, in particular, rainfall variability. More specifically, this component will support measures that improve: (a) harvest, capture, collection, delivery and distribution of water for agriculture and livestock purposes in surface water irrigated canal command areas, ground water sources and rainfed areas; (b) on-farm water use efficiency; (c) soil moisture and fertility improvements; (d) sustainable intensification and diversification of farm production; and (e) integrated crop and livestock farming systems. (a) Improvement of water use efficiency: This will be taken up under three different water scenarios, i.e. (i) irrigated command areas under surface (canal) irrigation, (ii) command areas under groundwater irrigation and (iii) rainfed area. Across all three water resource scenarios the project will support improvement in soil and moisture conservation (through contour bunding, contour vegetative barriers, etc.) and complimentary agriculture support services. Matching grant financing will be provided for development plans proposed, developed and implemented by the respective farmer groups which in turn will be responsible for mobilizing their contribution either in cash or in-kind or both. Specific arrangements will be explored during project preparation. (b) Technology transfer and market led advisory services: Technology transfer and market-led advisory services will be supported through Agricultural Technology Management Agencies (ATMA) which undertake productivity promoting activities aiming at improving soil moisture regimes and on-farm water use efficiency, increase production and permit sustainable intensification and diversification of cropping patterns. The project will finance (a) the demonstration and adaptation of location-specific soil and water conservation practices; and (b) the demonstration and use of improved crop varieties, integrated pest and nutrition management, as well as appropriate agronomic practices. Public-private partnership in agricultural service delivery will be encouraged. This sub-component will also support adaptive research on broad thematic priority areas (to be identified during the preparation) suitable for the project locations. The adaptive research program will be built on the technologies that have been already developed by the state agriculture universities, the Central Arid Zone Research Institute, the International Crop Research Institute for Semi Arid Tropic, the International Centre for Page 3 Agriculture Research in the Dry Areas, the International Livestock Research Institute and other partners through the Global Program on Climate Change, Agriculture and Food Security. (c) Livestock strengthening and management: Livestock provides a potentially significant source of diversified income to smallholder farmers operating in difficult climatic conditions. The project will support small ruminant livestock development (sheep and goats) through (a) establishing silvi-pasture plantations on private and common land as well as fodder processing and storage facilities, so that nutrition is made available for livestock round the year; and promoting green fodder cultivation as a crop diversification strategy; (b) developing organized livestock markets and livestock group marketing approaches; and (c) strengthening the Animal Husbandry Department's capacity to locally deliver cost-effective livestock support services such as animal health and nutrition, and to provide market linked advisory services. Component 2: Markets and Value Chains ($50 m cost): To allow farmers to access a wider range of markets, community-level marketing capacities and skills will be strengthened under this component. This will include the support to (a) develop value chains aiming to establish longer term partnerships and market linkages between farmer groups and agribusiness enterprises, facilitated through an Agri-Business Promotion Facility (ABPF); (b) develop alternate market channels; and (c) generation and dissemination of accurate and timely market information. A competitive mechanism allocating matching project grants to farmer organizations who partner with private sector enterprises in the formation of a longer term value chain will be developed during project preparation. (a) Value chain development: The competitiveness of small-holder farmers and agribusinesses will be promoted by facilitating the development and establishment of demand-driven value chains through a participatory approach. An Agri-Business Promotion Facility (ABPF) will facilitate the roll out of these participative value chains identification and stakeholder consultation. ABPF will also facilitate the implementation of Rajasthan#s new Agribusiness Policy, mobilizing national and state grants and supporting the implementation of the improved access for agribusinesses to rural based grants. (b) Alternative market development: A wide range of alternative market channels will be promoted, which will include, among others, establishing rural producer organizations for input and output marketing, upgrading local rural markets; and promoting warehouse receipts and access to electronic spot exchanges in collaboration with private sector. (c)Market information services: Project will consider options for creating a sustainable market and agricultural information service, as well as providing reliable information to the field extension offices. The main options will be (i) a public-private sector partnership in relying on outsourcing of Information and Communication Technology (ICT) services to private institutions or (ii) leveraging new software for large scale SMS broadcasting. Component 3: Capacity building, M&E, Project Management ($20 m cost):This component will support (a) mobilization and establishing of farmer groups and capacity building for participatory planning and plan implementation; (b) strengthening of institutions and human resources associated with the project implementation (i.e. participating line department and other Page 4 relevant agencies); (c) project management, robust monitoring and evaluation (M&E) system with a view of potentially scaling up approaches deemed successful under this operation across the state; and (d) building synergies and convergence with ongoing schemes from the Government of Rajasthan (GoR) and the Government of India (GoI) such as Rashtriya Krishi Vikas Yojana (RKVY; National Agricultural Development Scheme), the Mahatma Gandhi National Rural Employment Guarantee Scheme (MNREGS), etc. Development and pilot testing of production risk management tools in crop and livestock sectors will be supported under this component, in partnership with insurance companies and banks. D. Project location (if known) The project will be taken up in 4 to 5 regional clusters within Rajasthan, covering different agro- climatic conditions of the state (to be determined during preparation) and implement a location- specific menu of approaches and interventions. Selection of these geographical clusters will take into account, inter alia, drought-proneness, soil types, cropping pattern, sources of irrigation, marketing infrastructure, livestock population and importance, and maturity of the institutional structures. E. Bo rrower’s Institutional Capacity for Safeguard Policies [from PCN] The project will trigger four safeguard policies: Environmental Assessment (OP/BP4.01); Pest Management (OP/BP 4.09); Involuntary Resettlement (OP/BP 4.12) and Indigenous Peoples (OP/BP 4.10). The overall responsibility for the project execution will rest with the Department of Agriculture and its allied departments (including, amongst others, the Department of Animal Husbandry and the Rajasthan State Agriculture Marketing Board (RSAMB)) and the Water Resources Department. A state-level Steering Committee is being proposed for project oversight and guidance; while a Project Coordination Unit (PCU) is envisaged for the day-to-day implementation coordination, planning and scheduling, procurement management, financial control, reporting and monitoring. An assessment of implementation capacities of these departments will be done during preparation and suitably reflected in the project design; capacities will be strengthened during implementation. The institutional capacity of the Department of Agriculture to prepare and implement the environmental and social management frameworks will need to be significantly developed. The Environment and Social Assessments will include an assessment of the borrower#s capacities and recommendations for suitable measures. F. Environmental and Social Safeguards Specialists Ms Priti Kumar (SASDI) Mr Varun Singh (SASDS) II. SAFEGUARD POLICIES THAT MIGHT APPLY Safeguard Policies Triggered Yes No TBD Environmental Assessment (OP/BP 4.01) X This OP is applicable given the project#s focus on improving crop productivity and diversification, promoting efficient water storage, delivery, and distribution systems, watershed conservation, strengthening livestoc k activities and upgrading agricultural market infrastructure. Page 5 Safeguard Policies Triggered Yes No TBD The potential adverse environmental issues are expected be negligible instead the project is expected to have positive environmental impacts. Some of the direct or indirect environmental impacts relate to (i) accelerated overdrawal of groundwater due to improperly designed irrigation systems and approaches (ii) construction activities for infrastructure development, (iii) working of market infrastructure (generation and management of solid vegetative, animal, trash wastes) and (iv) livestock activities. An integrated Environment and Social Assessment (ESA) and Environment and Social Management Framework (ESMF) will be developed during project preparation. Natural Habitats (OP/BP 4.04) X Forests (OP/BP 4.36) X Pest Management (OP 4.09) X Other than possibly in the context of on-farm demonstrations, the project is not financing any direct procurement of pesticides and other agro-chemicals. However it is likely that with better marketing opportunities and advisory/extension services, farmers may increase land based productivity through application of fertilizers, pesticides etc for increasing crop yields and diversifying crop patterns and production. Therefore this OP is triggered. The ESA/ESMF will include appropriate measures and a strategy for Integrated Pest Management. Physical Cultural Resources (OP/BP 4.11) X Indigenous Peoples (OP/BP 4.10) X Rajasthan has one of the highest proportions of Scheduled Tribe population among the Indian states. The regional clusters, where the project will be implemented, are likely to have physical presence of scheduled tribes, particularly in the southern districts. The social assessment will identify the social impacts on tribals, assess the community support for the project among them, and recommend specific measures to ensure their inclusion and participation in project interventions and benefits. These measures will be included in the social management framework. Involuntary Resettlement (OP/BP 4.12) X The physical infrastructure that will be financed under the project component, includes soil and water conservation structures, small markets, livestock exchanges, collection centres etc. The social assessment will clarify the social impacts of these investments and provide inputs to the Social Management Framework. These will include social screening procedures, resettlement policy and entitlements, consultations with affected persons, and tribal and gender inclusion procedures. Social screening of infrastructure subprojects will flag any adverse social impacts, and recommend preparation and clearance of RAP before commencement of civil works. Safety of Dams (OP/BP 4.37) X Projects on International Waterways (OP/BP 7.50) X Projects in Disputed Areas (OP/BP 7.60) X Environmental Category: B - Partial Assessment III. SAFEGUARD PREPARATION PLAN A. Target date for the Quality Enhancement Review (QER), at which time the PAD-stage ISDS would be prepared: 08/30/2011 Page 6 B. For simple projects that will not require a QER, the target date for preparing the PAD-stage ISDS: N/A C. Time frame for launching and completing the safeguard-related studies that may be needed. The specific studies and their timing 1 should be specified in the PAD-stage ISDS. The social and environment assessments will take approximately 6 months. IV. APPROVALS Signed and submitted by: Task Team Leader: Mr Severin L. Kodderitzsch 01/13/2011 Approved by: Regional Safeguards Coordinator: Mr Sanjay Srivastava 01/13/2011 Comments: cleared on understanding that ESA, RPF and IPDF will be shared with us priot to appraisal. Sector Manager: Mr Simeon Kacou Ehui 01/13/2011 Comments: 1 Reminder: The Bank's Disclosure Policy requires that safeguard-related documents be disclosed before appraisal (i) at the InfoShop and (ii) in-country, at publicly accessible locations and in a form and language that are accessible to potentially affected persons. Page 7