Documentof The World Bank FOR OFFICIAL USE ONLY Report No: 27982-PK PROJECTAPPRAISAL DOCUMENT ONA PROPOSEDCREDIT INTHE AMOUNT OF SDR41.O MILLION(US$61.14 MILLIONEQUIVALENT) TO THE ISLAMIC REPUBLIC OF PAKISTAN FOR THE SINDH ON-FARMWATER MANAGEMENT PROJECT March4,2004 RuralDevelopmentSector Unit South Asia Region This document has arestricteddistribution andmay be usedbyrecipients only inthe performanceof their official duties. Its contentsmay not otherwisebe disclosedwithout World Bank authorization. CURRENCYEQUIVALENTS (Exchange RateEffective) Currency Unit = Pakistani Rupee(PRs) PRs58.0 = US$1 US$0.017 = PRsl FISCALYEAR July 1 -- June 30 ABBREVIATIONSAND ACRONYMS I ADB I- Asian Develooment Bank I IS 1- International Shoooing: ~ _ _ _ AG - Accountant _ General ISEA - IntegratedSocial & Environmental Assessment AWB - Area Water Board I W M I - InternationalWater Management Institute B C M - BillionCubic Meter M&E - Monitoring & Evaluation CAS Country Assistance Strategy MAF MillionAcre Feet CCA 1-I- CanalCommanded Area 1INARC ResearchCenter CDWP - Central Development Working Party NBP I-I-- NationalAgriculture National Bank o f Pakistan CFAA - Country FinancialAccountability NCB - NationalCompetitive Bidding Assessment CFS - Cubic Feet Per Second NDP - National Drainage Program Project D A C - Departmental Accounts Committee NGO - Non-govemment Organization DBG - Drainage Beneficiary Groups N S - National Shopping DGAER - Directorate General Agri. Extension and O&M - Operations & Maintenance Research DGAEWM - Directorate General Agri. Engg. & Water OBS - Output Based System Management I DOs - Direct Outlets OFWM - OnFarmWater Management I ECNEC I- Executive EA - Environmental Assessment I PAD ADoraisal Document I I * Committee o f National PCC 1-- Project Coordination Project Committee Economic Council EMP - Environmental Management Plan PC-1 - Planning Commission Proforma 1 EPA - Environmental ProtectionAgency PDWP - ProvincialDevelopment Working Party ERR - Economic Rate o f Return PFAA - ProvincialFinancial Accountability I I I I Assessment I FCMA - Fellow o f Cost & Management PIAC - Project Implementation Assistance Accountant Consultants FFS - Farmer Field School PIP - Project Implementation Plan FGW - FreshGroundwater PMP - Pest Management Plan - FIS - Financial InformationSystem PLL - PrecisionLand Leveling FMR - Financial Monitoring ReDorts PPAF - PakistanPovertv Alleviation Fund FWOP - Future Without Project QCBS - Quality & Cost BasedSelection FWP - FutureWith Project RFP - Request for Proposal GCA - Gross CommandedArea SBCQ - SelectionBasedon Cost & Quality GFR - GovernmentFinancial Regulations SCF - Standard Conversion Factor FOROFFICIAL USEONLY Abbreviations and Acronyms Cont'd. GOP Government o f Pakistan SDC I-1--Social Development Cell o f SIDA GOSindh I-I- Government of Sindh IISGW Saline GroundWater GPN - General Procurement Notice SID Sindh Irrigation Department GWDS - Groundwater Depth Score SIDA - Sindh Irrigation & Drainage Authority GWQS - Groundwater Quality Score S M - Social Mobilizer IBIS - IndusBasinIrrigation System SWD - Sindh Wildlife Department ICB - International Competitive Bidding SOE - Statement of Expenditure ICR - Implementation Completion Report SWMO - Sindh Water Management Ordinance 2002 IDA - International Development Association TS - Total Score (The Association) GLOSSARY Abiana Irrigationwater charges Cattle Ghat: Cattle drinking water point Diwan: Money lender Dehs: Tertiary irrigation command area Hari Landless tenant Khar$ Summer crop season (April-October) Killa Bushing Wooden stakes andbushes usedas spurs to induce berms formation in irrigationchannels Mogha: Un-gated outlet from distributaryor minor canal Nazim of District Electedheadof district government Pucca Nukka: ConcreteTum-out PC-1: Planning Commission Proforma 1(Government Project Appraisal Document) Pedi: Shop keeper Rabi: Winter crop season (November-March). Sarkari Khal: Communal part ofwatercourse Taluka Sub-division of district Wadera: Landlord Warabundi Traditional rotational water distribution systemat the watercourse level Vice President: Praful C. Pate1 Country Director: JohnW. Wall Sector ManagedDirector: Adolfo Brizzi/Constance Bernard Task Team Leader: Usman Oamar This document has a restricteddistributionand may be used by recipients only in the performance of their official duties. Its contents may not be otherwise disclosed lwithout World Bank authorization. ------J PAKISTAN SINDH ON-FARMWATER MANAGEMENT PROJECT CONTENTS A. Project Development Objective Page 1. Project development objective 2 2. Key performance indicators 2 B. Strategic Context 1. Sector-related Country Assistance Strategy (CAS) goal supportedbythe project 3 2. Main sector issues and Government strategy 3 3. Sector issuesto be addressedby the project and strategic choices 10 C. Project Description Summary 1. Project components 11 2. Key policy and institutionalreforms supportedby the project 13 3, Benefits and target population 13 4. Institutional and implementation arrangements 14 D.ProjectRationale 1. Project altematives considered andreasonsfor rejection 17 2. Major relatedprojects financed by the Bank and/or other development agencies 18 3. Lessons leamed and reflected inthe project design 18 4. Indications ofborrower commitment and ownership 19 5. Value added of Bank support inthis project 20 E. Summary ProjectAnalysis 1. Economic 20 2. Financial 20 3. Technical 22 4. Institutional 22 5. Environmental 25 6. Social 26 7. SafeguardPolicies 30 F.SustainabilityandRisks 1. Sustainability 32 2. Critical risks 32 3. Possible controversial aspects 34 G, MainCredit Conditions 1. Effectiveness Condition 35 2. Other 35 H. Readinessfor Implementation 38 I.CompliancewithBankPolicies 38 Annexes Annex 1: Project Design Summary 39 Annex 2: DetailedProject Description 43 Annex 3: EstimatedProject Costs 69 Annex 4: Cost Benefit Analysis Summary 70 Annex 5: Financial Summary 80 Annex 6: (A) Procurement Arrangements 81 (B) Financial Management andDisbursementArrangements 88 Annex 7: Project Processing Schedule 96 Annex 8: Documents inthe Project File 97 Annex 9: Statement of Loans and Credits 98 Annex 10: Country at a Glance 100 Annex 11:Pest Management Plan 102 Annex 12: Detailed Cost Tables 113 MAW) IBRDMap 32753 PAKISTAN Sindh On-Farm Water Management Project ProjectAppraisalDocument South Asia Regional Office Rural Development Sector Unit Date: March4,2004 Team Leader: UsmanQamar Sector Director: Constance A. Bernard Sector(s): Irrigation and drainage (100%) Country Director: John W. Wall Theme(s): Rural policies and institutions (P), Water Project ID: PO78997 resource management (P) Lending Instrument: Specific Investment Loan (SIL) [ ]Loan [XI Credit [ ] Grant [ ] Guarantee [ ]Other: BORROWER 6.12 0.00 6.12 IDA 55.94 5.20 61.14 LOCAL FARMERORGANIZATIONS 17.51 0.00 17.51 Total: 79.57 I 5.20 I 84.77 A. Project DevelopmentObjective 1. Projectdevelopmentobjective: (see Annex 1) A.1.1 The project developmentobjective is that farmers inthe project areabetter managewater andincreaseagriculturalproductivity, supportedby improvedirrigation infrastructure and service delivery.This objective would be achievedby: (a) improving the efficiency, reliability, and equity of irrigation water distribution; (b) supporting agricultural productivity enhancement measuresto complement and enhance the benefits of improved water management; and(c) enhancing long-term financial sustainability o f the irrigation systemby fostering self-sustaining farmer organizations at the watercourse anddistributary canal levels, which i s a key element o f the decentralized and financially sustainableinstitutionalapparatus, GOSindh is endeavoring to establish. 2. Key performanceindicators: (see Annex 1) A set of specific andleading indicators for inputs, outputs andoutcomeshavebeen agreedduring appraisal andnegotiations. OutcomeRmpactIndicators(At the endofProject-comparedto baseline): ImprovedO&M and water distribution indstributary canals managedby farmer organizations (F0s)-- i.e. improvedreliability, and equity of irrigationwater distribution Improvement inwater conveyanceefficiency inimproved watercourses Increaseincropping intensity Increaseincrop yields Reduction inuse o fpesticides Output Indictors(At the endofproject) Watercourseassociations (WCAs) and FOs establishedinaccordance with the Sin& Water Management Ordinance (SWMO) o f 2002, are active, conducting business democratically, providing responsive, sustainableservicesto communities as measuredby indicators included inAnnex 1 improvedbranch anddistributary canals have adequate capacity to carry full design discharge decreasein incidence o f canal breaches increaseinwater supply at farm gate as compared to baseline increase inwatercourse delivery efficiency farmers on 100 distributaries demonstrateknowledge o f improvedpractices farmers carryout land leveling timely feed back onproject impact providedandtaken into account inimproving design and implementation project incentive framework for promotingparticipationo f women and sharecroppers tested and proposals for improvement made lessons learned for future operations project implemented efficiently and intimely manner quality of works and services completed i s satisfactory - 2 - 9. Strategic Context 1.Sector-related Country Assistance Strategy (CAS) goalsupported by the project: (see Annex 1) Document number: 24399-PAK o f June 24,2002 Date of latest CAS discussion: June 24, 2002 The proposed project will support the CAS goal ofreducingpoverty through pro-poor growth, by: (i) supporting GOSindh's efforts to improve water management, agricultural productivity andfarm incomesthrough institutional improvements and greater stakeholdersparticipationand empowerment; (ii) improvinggovemance inirrigation andagriculture through partnerships among public utilities (area water boards) andfarmers for improvedoperation and managementof irrigation systems, thereby promoting broad-basedproductivity increasesinirrigated agriculture; and (iii) supporting highpayoff improvements inthe secondary andtertiary irrigation infrastructure. The proposedproject is specifically identified inthe CAS andmeets the Bank'sthree strategic engagement principles: (i) strong "client pull" to reform and selectivity; (ii) programmatic approach focussed on transfer ofknowledge andcapacity buildingfirst, and resourcessecond, inpursuitof key development objectives; and(iii) partnership andoutreach. 2. Main sector issues and Government strategy: Background i' B.2.1 The IndusBasin IrrigationSystem (IBIS)). Irrigation anddrainage are crucial to Pakistan's irrigated agriculture, which is the backbone o fthe economy. Around 80% o f arable landsand90% o fagricultural output (25% of GDP) are entirely dependenton irrigation. The IBIS is the largest integratedirrigation network inthe world, consisting o f Indusriver and its tributaries, three major storage reservoirs, 19barrages, 12 inter-river link canals, 43 irrigation canal commands, and over 110,000 watercourses,deliveringwater to farms. Water is divertedfrom the rivers by barrages or headworks into the maincanals. Generally the hierarchical canal systemm s from maincanals to branch canals, distributaries/ minors and watercoursesthat supply water to dehs (tertiary irrigation command area) through moghas (ungated outlets) indistributaries and minors. Each farm receivesthe full flow of the watercourseby turn for a duration depending on the farm size. This systemo fwater distribution i s called warabundi. The turnouts from watercourses to the farmers' fields are called nukkas. Practically the entire systemis unlined, resultinginseepage andoperational losses. The lossesare particularlyhighfrom watercourses. Insaline groundwater areas these losses are generally irretrievable. Annually, the irrigation systemdraws an average o f 104MillionAcre Feet(MAF)/128.4 Billion Cubic Meter ( B o o f surface water, supplementedby about40 to 42 MAF (49 to 52 BCM) ofpumpedgroundwater, much o fwhich is by way of recovery o f losses due to seepage inareas underlain by fresh groundwater (FGW) aquifers. B.2.2 Sindh has three major barrages on the IndusRiverthat divert approximately 45 MAF to 48 MAF (55.5 to 59.25 BCM) ofwater annually to the 14maincanal commands inSindh. These canal systems have an aggregatelength o f 11,916 miles (19,066 Km) o f canals, which serve a gross command area (GCA) of 14.391million acres (5.8 million ha). There are about 42,000 watercourses (tertiary channels), which have an aggregatelength o f about 75,000 miles (120,000 Km). So far only 7,500 watercourseshavebeenimprovedlinedunder various on-farm water management(OFWM) programs. B.2.3 DrainageSystem.Around 78%of the area in Sindhprovince is underlainby saline - 3 - groundwater, which is unsuitable for irrigation (more than 1000mdlitre total dissolved solids (TDS)). Close to the edgesofthe irrigated lands, fresh groundwater canbe found. Indiscriminate pumping has resulted incontamination ofthe aquifer at many places where salinity o ftube well water has increased.Unlike the IBIS, the drainagenetwork inPakistan i s not contiguous and integrated. Surface and sub-surfacedrainage systems are inadequate, resultinginmuch of the drainage effluent beingeither retained inthe basin or disposedinto rivers andcanals. There are 13 existing surface drainage systems in Sindh, which serve a total area o f over 6.2 Millionacres (2.5 Mha) andhaveanaggregate lengthofabout2,981 miles (4,800 Km). Inadditionthere aretwo sub-surface drainage systems, which serve an area o f 0.10 Millionacres (0.04 Mha). Dueto inadequatedrainage cover, nearly one-fifth o fthe canal command areas have been affected by water logging andsalinity. B.2.4 LandandAgriculture.Sindh has atotal populationofover 30 million, majority ofwhich (51%) lives in rural areas. The total geographical area is 14millionha, constituting 17.5 percent o f Pakistan. About 5.8 millionha is commandedby canals. Net area sown is about 3 millionha, with about 1million ha sown twice a year. B.2.5 Poverly inSindh.Poverty is pervasive anddeep inrural Sindh. About 37% o fthe ruralpopulation lives below the poverty line comparedto 33% inPakistan on an overallbasis. Over 70% o fthe rural populationis landless. Analysis o fthe 2001 PakistanRural Household Survey data, however, shows that rural households, includingthe landless,derive 56% o f their income from agriculture, directly or indirectly. A typical poor householdinrural Sindh, has little assets or land, depends on wage income, andis significantly larger than the non-poor household in Sindh or even comparedto the average poor household of Pakistan. The rural poor tend to be employed mostly as agriculture wage workers. The concentration of poor is the highest among categorieso fhouseholdswhere the head is anunpaidfamily worker, sharecropper,or owner-cultivator owning less than 2 hectareso f land. The poverty headcountsinthese categories are 60%, 50% and40% respectively. Rural Sindh is highly dependent on public services with littlerole o f the private sector. Thus reforms to improve public service delivery and stimulate rural growth --that raise agricultural and nonagricultural wages --- are hdamental for reducingpoverty inrural Sindh. Irrigation and Drainage Sector Issues B.2.6 Irrigationanddrainage inPakistanface major issues that are evident invarious forms (see below) with many o fthemstemming fromunderlying institutional weaknesses. The major institutional issue is a near exclusive control o f the irrigation & drainage systemby the public sector, characterizedby the usual inefficiencies o f centralized bureaucracies, lack o f corporate skills andpoor client (farmer) focus and accountability. Lack of storage capacity and control structures i s anothermajor constraint. Water availability inthe Indusbasin irrigation system i s highly seasonal with 85% o f annual river flows occurring duringa 90 to 120 days period (June to September) makingstorage imperative for the Rabi (winter) crop season, during which the main staple crop --wheat-- is grown. While the construction o f three major reservoirs (Tarbela, Mangla, Chashma) has providedsome flexibility incanal operations to meet irrigation water demand inthe Rabi crop season, the reservoir capacity and its operation is inadequate. This combinedwith the lack of control structures inthe systemmake it difficult to managethe system on a "demand basis". Institutionalweaknesses manifest inthe form o f (i) low water delivery efficiency (only about 35-40% from the canalhead to crop root zone); (ii) water distribution inequities; (iii) wasteful on-farm water use; (iv) waterlogging and salinity; and (v) poor O&M andlow cost recovery. Sindh faces the same issues. - 4 - (i) Lowirrigationdeliveryandapplicationefficienciesarisefromseveralfactors,including excessivelengths of unlinedalluvial channels; lack ofroutine andpreventive maintenance; channel erosion and siltation; inadequate control structures, culverts andcattle drinkingpoints; nonstandard outlets for irrigating the fields; poorly levelledfarms; and inappropriate scheduling o f water in canalsnot reflecting crop water requirements. Losses are particularly high from unlined watercourses,ranging from 25% to 30% of the water entering the watercourse. Highwater losses not only reduce water availability for crops but also contribute to water logging and salinity. Withreducedwater availability, irrigators at the tail-ends ofwatercourses, inparticular, are exposedto greaterrisks of crop failures leaving little incentive for themto invest innon-water inputs, The drought andaccompanying canal water shortages duringthe last four years has worsenedthe situation. (ii) Water distribution inequitiesresult from excessive losses inthe conveyance system, unauthorized outlets and illegal pumpingfrom canals, facilitated byrent seeking agency field staff. Poorly maintainedwatercoursesand minor canals have the highest incidence o f illegal diversions. Direct outlets (DOs) from mainandbranch canals further contribute to inequitable distribution due to withdrawals inexcess o f authorized discharges. Most DOs do not have regulating structures and continue to receive water even during periods o fwater shortage, whennormal outlets receive water byrotation. This aggravateswater shortages inthe tailreaches ofchannels.Evenwhen 111design discharge is available at the heads o f channels, rotation is neededinthe systemdue to excessive withdrawal by the DOs. Except for those canal commands where Area Water Boards (AWBs) and FOs have been formed, there are no effective forums for farmers to raise their concems. Collective actions are rarely contemplated to address inequities ofwater distribution. Moreover, the excessive role ofthe government inirrigation managementdoes not encouragemeaningful beneficiary participation inthe systemmanagement. (iii) Wasteful use of water on the farms stems from several factors. Firstly, farmers tend to over-irrigate partlybecause o f the wrong notionthat higher watering means higher yields, but partly also because they are unsure whether they would get their next tum o f irrigation on time. Thus over watering is often viewed as an insurancefor the fume. Secondly, scheduling o f water is inappropriate -- canal deliveries generally bear little relationship with crop water requirements. In the Kharif(summer crop) season, whenriver supplies are plentiful, the water deliveries incanals often exceedcrop requirements. There beingfew escape structuresinthe canal system, once water is diverted in a canal, it i s delivered to watercourses andto the farms, regardlesswhether the crops needit or not. Thirdly, inefficient croppingpattems and agronomic practices such as plantationo f rice by the Poncho method also promote wasteful water use. Under this methodo f rice plantation, water is continuously delivered to the fields and allowedto cascade from one fieldto another, finally leading to surface drains. The resultingwater use efficiency is extremely low and water logging and salinity problems are exacerbated. Fourthly, poorly leveled fields and the practice o f flooding the entire field for irrigation result inwastage. Finally, underpricing of water andinefficient systems andproceduresfor assessmentandcollectionofwater charges, provide little incentivefor improving water use efficiency. (iv) Depending on the degree o f water loggingand soil salinity, crop yields are reduced by 25% to 60% of the potential yields. The twinproblems o f water logging andsalinity are most severe inSindh, beinglocated inthe lower part of the Indusbasin and repository o fplain's drainage water. The water table is less than 8 feet (2.5 m) deep over 37% of the area. Groundwater is moderately saline over 56%, andhighly saline over 32%, o fthe area. While "curative" engineering - 5 - solutions are necessary inmany areas, and are beingsupportedunderthe National Drainage Program (NDP), "preventive" solutions (improved water managementto reduce drainable surplus) have received less attention than needed. (v) The century-old irrigation anddrainage infrastructure is ina state of disrepair and rapid deterioration due to utilizationbeyonddesign capacities, tampering of control structures, damageto canal banks causedbyhumanandcattle trespassing, and inadequate routine andpreventive maintenance. The assessmentmadeinthe Ten Year PerspectivePlan indicates that, duringthe last 10years, the average annual expenditure on O&M of irrigation anddrainage infrastructure inSindh was 28% short o frequirements. Boththe provisions and actual budgetreleasesare inadequateto meet the O&M requirements. Salarieso f the overstaffed irrigation deparbnent account for over 50% o fthe total O&M budget. While there is an accumulation o f deferred maintenance all over the system, smaller irrigation channels(distributaries andminors) are the most neglected. Inmany cases, small channels operate without control structures (gates, regulators). Water charges and drainage cess account for less than 20% o f even the less than adequate expenditures on O&M. Pakistanhas made significant investmentinthe past on rehabilitating the irrigation anddrainage systems. An attempt was madeto clear the backlog ofmaintenanceofirrigation canals andsurface drains under two Irrigation Systems Rehabilitation Projects (ISRP), implemented during 1982-94. While the program was successfulinreducing the backlog o fmaintenance, it lacked the institutional changes neededfor long-term sustainability o fthe system with the result that deferred O&M has once again accumulated. Other Issues Affecting Irrigated Agriculture B.2.7 Agricultural trade and pricing regimes have beensubstantially liberalizedto the point that few distortions remainat the macroeconomic level. However, a significant agenda o f second generationreforms remain to addressthe unequal opportunity andcapacity to access credit and assets, markets, land, water and technology -- thesefactors directly affect productivity and farm incomes. Skewed landholdings and landtenure arrangementsas well as low social capital further exacerbateruralpoverty. B.2.8 Poor Access to Credit. The rural poor of Sindh, like inthe rest o fPakistan, have very limited access to credit. Collateral requirements and hightransaction costs o fpublic sector banks and financial institutions have prevented the ruralpoor from accessingthese institutions. These costs include: filling in lengthy application forms; landownership documentation; cost o fmultiple trips to banks; lengthy and protracted time for loan processing; kickbacks to bank officials, etc. Furthermore, these costs, which are considerable, have to be incurred before the loan is sanctioned. Lack o f access to the formal sector has resulted inrestricting borrowingby the poor inrural Sindh to informal sources including waderus (landlords), shop keepersandmoney lenders (Pedis andDiwuns) who often buy standingcrops themselves andmarket them. Rateso f interest o fthe informal sector have beenusurious,ranging from 80% - 120% per annum - consequentlythis source ofcredit proves very expensive for the poor andleaveslittle for savings or investment. Past efforts by Government to help and reach the poor using subsidized and directed credit have mostly failed. Concessionaryrateshave meant that credit had to be rationed and its hijacking by influential groups could not be checked. Loan recoveries too have been poor resulting in making these loans far more concessionary andrequiringlarge infusions o fpublic resourcesperiodically. A feasible altemative to boththe formal andinformal sources ofcredit for the poor has emerged, through micro-credit program o fNGOs. These NGOsmostly charge market rates o f interest, have greatly reduced procedural requirements and formalities for loan approval anddeliver credit at the doorstep o f the poor. - 6 - The success o fthis third sector has ledit to become the focus o fpublic policy recently, with increasing reliance on these institutions for delivery o f financial andnonfinancial services to the poor. The Pakistan Poverty Alleviation Fund(PPAF) (supportedby IDA funding) is an important initiative inthis respect. The PPAFestablishedbythe Government as anapex national institutioninthe private sector, is wholesaling financial andnonfinancial services to the poor throughNGOs. B.2.9 Skewed Land Holdings. While the average farm size is small (4.3 ha), landownership is skewed infavor oflarge holders. There are over 800,000 farms with atotal area ofabout 3.5 millionha. Over 93% of the farms are small (less than 7 ha) and represent 64% of the total farm area. Large farms (greater than 7 ha) are only 7% innumber but representnearly 36% o f the total farm area. B.2.10 LandTenure Arrangements. The landtenure system inSindh has regulated ownership, tenancy andinheritance rights. The systemhasundergoneseveralchanges sincethe days ofthe British,who bequestedlarge tracts o f landto loyal local influentials. Recognizingthe need for more equitable distribution o f agricultural landand security o f tenancy, the GOP has attempted reforms, with varying degrees o f success. With waderus (large landlords) unwilling to surrender their rights, haris (landless tenants) not ina positionto exercisetheir rights, andthe state lackingthe will to implement its writ, the situation has not improved. However, natural successionhas resulted insome division and fragmentation o f land. About 50% o fthe farms, representing about 59% o fthe total farm area, are operated by owners, while 42% o f the farms (representing29% o fthe total farm area), are operatedby tenantshharecroppers, who are locally knownas hark The remaining 8% o f the farms, representing 12%o f total farm area, are operatedby owners-cum-tenants.The skewednature ofthe landholdings has tendedto make largeholdings unproductive as considerablelandis left fallow, particularly inthe case of absentee landlords. B.2.11 Low Social Capital. Rural Sindh suffers from low social capital. It is an agrarian and feudal society structured around complex temporal and spiritual leadership dynamics. The encompassment o f a givenleadershipcanrangefrom a single village to several districts inSindh. Temporal power is derived from the ownership of landand the traditional tribal systemprevalent inan area. The spiritual system, on the other hand, draws its authority from religion. This spiritual system i s either institutionalizedthrough claiming direct descent from the Holy Prophet o f Islam or through descent from a Sufi saint. Menexercise both types of power andleadership. However, there is significant hiddenpower exertedby the waderi (the wife ofthe wadera)on the key players o f the hierarchy, who plays akey role inaddressinggrievance of hark B.2.12 Status of Women inRuralAreas. The status of women inrural Sindh like inthe rest of the villages inPakistanis acutely disadvantaged. Women bear a disproportionately highshare o f the burdeno f poverty; have low social status; very limitedaccess to economic options and social services; lower endowmentso f landandother productive assets; and are severely hinderedintheir mobility. GOSindh's SectorStrategy and Implementation Status B.2.13 A holistic water resourcesmanagementstrategy encompassingpolicy andinstitutional improvements, improvedmanagemento f storages, infrastructure improvement, environmental sustainability, productivity enhancement, and poverty alleviation, is required to address the above issues effectively inconcertwith other provinces andWAPDA the reservoir operator. While realizing the need -- for such a holistic strategy and initiating its preparation, GOSindh has evolved an interim strategy that would yieldquick dividends, within the broader constraints mentioned above, while buildingthe foundation for the longer term strategy. This interim strategy has three inter-related elements: (a) fostering an institutional,policy and operationalframework conducive to efficient andself-sustaining operation and - 7 - maintenanceof the irrigation system; (b) supporting WCAs inimplementinghighpayoff infrastructure improvementsneededfor improvedwater management, particularly at the tertiary level o f the irrigation system, at a much accelerated pace, than inthe past; and (c) enhancing agriculturalproductivity and incomes by introducingimproved technology, agronomicpractices, and informationknowledge systems. B.2.14 The first element o fthe strategy is predicateduponthe implementation of fundamental andfar reaching institutional reforms that are beingsupportedunder the NDP. These reforms involve decentralization andtransfer ofmanagement ofthe irrigation anddrainage systemfrom the Sindh Irrigation Department to a multi-tier system of autonomous institutions, with clearly defined roles andresponsibilities within the system, with a fmcommitment to rationalize O&M subsidies. The key elementsofthe reforms, the hierarchy o fthe new institutions andtheir roles and responsibilities are as follows: (i)conversion o f the IrrigationDepartment into an autonomous Sindh Irrigation and Drainage Authority (SIDA), with responsibilityfor intra-provincialaspects of the system, including O&M o fbarrages and main canal headworks, and management of intra-province bulkwater transfers, including water deliveries at the heado fmain canals and managementof drainage effluent inmain drains that extend across canal commands; (ii)establishment of self-accounting, commercially oriented, client responsive and financially sustainable area water boards (AWBs) --public utilities-- on each maincanal, responsible for operating and maintaining the irrigation anddrainage systemwithin the maincanal command up to the head o f the distributary canals; and (iii)establishmento f FOs, owned and managedby farmers, and responsible for O&M o f the irrigation and drainage systemwithin the command area o f distributaryandminor canals and collection o f abiana (water charges). FOs would have representationon the AWBs. The longterm vision is that once the new institutions become operational, SIDA would enter into contracts with AWBs for bulk supply o f irrigation water and receipt ofthe drainage effluent generatedwithin the limitsoftheAWBs. The AWBs would enter into similar contracts with FOsfor bulk supplyof water at the headofthe distributary canals. The FOswill collect abiana, retain a part o fit andpass on the remaining proceedsto AWBs for maintenanceof the main canals. The AWBs would intumpass on a portionof the amounts received to SIDA for the O&M o fthe systemunder the latter'sjurisdiction. It is expectedthat the reforms would lead to SIDA andAWBs developing into vibrant autonomous bodies capableo f improvedmanagementand O&M o f the upper tiers o fthe irrigation systemthat would result in improvedand sustainableoperations, higher water deliveryefficiency and better scheduling o f canal deliveries reflecting more closely the irrigation requirements incanal commands. Establishment of FOs would leadto more equitable distributiono fwater amongstwatercourses, improvedandcost effective maintenanceandmore efficient collection o f abiana. The current status o f the institutional reforms at various tiers of the system is summarizedbelow: 0 Upper Tier Reforms. The Sindh Irrigation andDrainage Authority (SIDA) Act was passedin 1997to provide legal cover for the reforms. Inthe year 2002, the SIDA Act was repealed and replacedby the Sindh Water Management Ordinance (SWMO). Under the SWMO a Regulatory Authority of Irrigation, Drainage andFloodControl is to be established to ensure compliance with the statutory provisions o fthe SWMO. The Regulatory Authority will also promote effective interaction among the SIDA, AWBs and FOs and their various support bodies and will arbitrate betweenthem as and whennecessary. Itwill establish standards of performance for eacho f the - 8 - AWBs andregister the FOs. Itshall also fix maximumcharges, which SIDA, AWBs andFOsmay recover from the users. Untilthe Regulatory Authority is established, SIDA shall perform the functions o f the Regulatory Authority. AWBs have beennotified for 5 canal commands (Nara Canal; Ghotki Feeder; Left BankCanals; WesternCanal; SindhBegari Feeder). However, so far only the first three are operational as Boards, while the last two do not have Boards as yet. SIDA's organizational structure, staffing, systems, rules and regulations are being developed. AWBs would gradually be establishedon all the 14 canal commands in Sindh. 0 MiddleTier Reforms.This involves establishmentandcapacity buildingofFOsat the distributary/minor canal level, representingfarmers at the watercourse or deh level. FOs are legal entities registered underthe SWMO, and authorizedby AWBs to take over responsibility o f O&M andcollecting water chargesunderformal irrigation anddrainagemanagementtransfer (IDMT) agreements. FOs representtheir respectivedistributaries or minors on the AWBs. There have been severalpilots andlearningon the approachto establishing effective andempowered FOs at the distributarycanal level inallprovinces ofPakistan, including Sin&. Results ofthese pilots have been encouraging interms of improved equity ofwater distribution, cost effective O&M as well as cost recovery. Two important lessons learnt from these pilots are: (i) good quality social mobilization and capacity buildingare critical for establishingeffective FOs; (ii) infrastructure improvements must accompany the transfer of irrigation management to FOs to enable these fledgling entities to operateefficiently. Ultimately over 1300FOs are to be establishedinthe 14 canal commands/AWBs of Sindh to manageO&M and collect water charges. This is a major undertaking, involvingintensive social mobilization and capacity buildingefforts. The process o f establishing FOs has beenstartedbythe Agriculture Department inthe Nara canal AWB, and good progresshas beenmade. As o f July 2003, over 190FOshave been formed and formal IDMT Agreements have been concludedwith over 130FOs. Arrangements for training and capacity buildingare neededto establish a critical mass ofeffective FOs quickly to putthe uppertier reforms on a strong foundation and to make the change irreversible. 0 Lower Tier Reforms. This involves establishing effective watercourse associations(WCAs) at the watercourse level. WCAs act as the electoral college for FOs at the middle tier (distributary level), operate and maintainwatercourses, improve on-farm water managementand cany out various agricultural improvement activities. Arrangements are neededto makeWCAs effective through structured social mobilization andcapacity building. B.2.15 The secondelement of GOSindh's interim strategy --supportingcommunitiesto carryout acceleratedhighpayoffinfrastructureimprovementsat the tertiary level--complementsthe first element of the strategy, but standsonitsownmerit. It involves, establishingeffective community organizations/user groups at the watercourse, and distributary canal levels to provide a solid foundation for the uppertier reforms. Also, investmentsto makethe irrigation infrastructure functional and efficient are essentialto enable the fledglinginstitutions (WCAs, FOs) to perFormandyield intended outcomes. Overall progress on establishing WCAs and infrastructure improvements at the tertiary level has been slow, primarily due to lack o f capacity for social mobilization and capacity building.GOSindhwishes to improve the speedand effectivenesso fthis program through greater participationby WCAs. One desired outcome is to expand the percentageo f irrigatedarea covered by tertiary level improvements. This project will increasethis coveragefrom the current (less than 18%) to 27%, ina four-year time slice. Inaddition, GOP is considering a country wide watercourse improvement programthat would include improvement o f the remaining 28,000 watercourses inSindh, not coveredby this project. - 9 - B.2.16 The thirdelement of the strategy -- supporting productivityandincomeenhancement measures- is critical to reapthe full benefits ofinstitutional andinfrastructure improvements interms of higher productivity, andto help translatehigherproductivity into higher incomes. Past interventions inthis regardhave beenlimitedto a few demonstrationcenters, routine training & visit (T&V) type extension activities and some efforts at informationdissemination. Few attemptshave beenmade to introduce improved technology (land leveling, improvedfarm layout, zero-tillage, sprinkleddrip, etc.) and information systems. The impact has beenmodest. GOSindh is exploring new and more efficient ways o f improving andscaling up deliverymechanisms for new technologies, extension, input supplies, storage and processing, markedmarketing information, andmodem information systems, including access to internet. Current thinkingi s that these activities would be developed aroundthe new institutional setup, primarily at the AWBs, FOs, and WCA levels. 3. Sector issuesto be addressed bythe project andstrategicchoices: B.3.1 The project would support selectedelements o f GOSindh's above strategy andaddress issues relatingto: (i) beneficiary/community participation inthe management,andO&M o f the irrigation systemat the distributary andwatercourselevel; (ii)irrigation efficiency, on farmuse and equity of water distribution; (iii)sustainability of the system; (iv) productivity enhancement; and(v) capital cost sharing. B.3.2 StrategicChoices. The broadstrategicchoices relate to two aspects: (i) specific aspects what o f GOSindh's strategy for addressing irrigation and drainage issues should the project selectively support?and(ii) how to enhance capacity for implementingreforms and urgentlyneededinfrastructure improvements at a faster pace thaninthe past. The project's strategic choices inthis regardare: (i) Theprojectwouldfocusatthedeh(tertiary)levelwithlimitedinterventionsatthedstributary level as well. This choice is basedon the following considerations: (a) while the upper-tier institutional reforms (SIDA, AWBs) andrequirement of investments indrainage are being supportedby the NDP project, there are no arrangementscurrently inplace for supporting the lower level reforms and tertiary levelphysical improvements, which require a separate intervention involving intensive social mobilization and capacity buildingefforts; (b) maximumwater losses occur inwatercourses, farmer ditches andfields; (c) strengtheningcommunity and farmer organizations at the lower levels would provide a solid foundation for the reforms at the upper tiers o fthe system; (d) financial and economic returns to tertiary level investments are high(ERR over 20%); (e) there is a large potential for increasing productivity through introductiono f new technologies (e.g. landleveling, improved agronomic practices); and(f) farmers are well familiar withthe tertiary level interventions that are of a simple nature andfor which there is akeen demand. (ii) Analysisofpaston-farmwatermanagementprojectsinSindhhashighlightedtwomainfactors that contributed to slow progress. First,the Agriculture Department relied mainly on short term contract staff for project implementation. Due to job-uncertainties those staff lackedthe motivation required for mobilizing farmer support and confidence, that are key to successful implementation for projects o fthis nature. Second, the role o fWCAs inproject implementation was limitedwith Agriculture Department's staff beingresponsible for practically all aspects o f implementation. Besides social mobilization and providing technical inputs (surveys, design, supervision), the Department staffwere also responsible for procurement of construction materials, as well as work planningand scheduling. For the proposed project two significant changes are beingmade to address the above issues. Firstly, GOSindh and District Governmentsare deployingmore regular staff than inpastprojects. Secondly, WCAs have been given a central role inimplementation. An output basedsystem(OBS) has been developed andpilot - 10- testedfor construction o f watercourses. Underthis system, the role of the Department staff is limitedto providing only technical assistance(survey, design, quality control) while procurement o f materials and all construction work i s the responsibility o fthe WCAs. Funds are releasedto WCAs on the basis of a simple Agreement between the WCAs andthe Departmentthat specifies outputs or milestones of progress. C. Project DescriptionSummary 1. Projectcomponents(see Annex 2 for adetaileddescription andAnnex 3 for a detailed costbreakdown): The Agriculture Department carried out an integratedsocial andenvironmental assessment(ISEA), which providedthe basis for the project design andimplementation framework. The proposed four-year project would focus on those canal commands inSindh where upper tier institutional reforms are inprogressand Area Water Boards (AWBs) have beenestablished. A limitednumber o f watercourse improvements would, however, be carried out inareas outside AWBs as well, subject to the principles and criteria summarized inAnnex 2. The project supportsfive mutually complementary components: A. Social MobilizationandCapacityBuilding. This component involves developing sustainable farmer organizations (FOs) who can effectively operate andmaintainthe irrigation anddrainage system, through social mobilizationandcapacity building. Numerous WCAs andmore than 190FOs have already beenestablishedinSindh ofwhich 160 FOs are inthe Nara AWB. Further social mobilization efforts are currently underway. The project will supplementthese efforts by establishing approximately 100more FOs, inthe areas where AWBs are to be establishednext, andbuildingthe capacity o f FOs (existingas well as new FOs). Training andcapacity buildingfor WCAs andFOs would focus on getting these organizations ready for taking over responsibilities for O&M and abiana (water charge) collection as well for improving productivity. Irrigation andDrainage Management Transfer Agreements (IDMTAs) would be concludedbetween the AWBs and the FOs to define the terms oftransfer androles andresponsibilities of all parties. The WCAs andFOswouldbe involved inplanning, designing, andimplementingirrigation improvement works underthe project, as well as inproviding agricultural support services. B. High PayoffImprovementsofIrrigationFacilities: i) Tertiarylevelimprovements,including: (a) improvement o f about 4,000 watercourses, comprising, earthen improvements, lining, installation ofpucca nukkus (concrete turnouts) culverts, community structures (e.g. washing bays for women), cattle crossings andbuffalo baths; and (b) construction o fapproximately 200 water storagetanks inthe rain-fed areas. ii) Improvement of distributary canals, targeting about 100 distributarylminor canals managedby FOs. The improvementhehabilitation works would generally include: (a) restoration o f outlets, weak sections o f channel banks andberms, and de-silting; (b) repair ofregulator gates, cross regulators and diversion structures, protectionworks upstream and downstreamo f structures and channel sides, cattle crossings andcattle ghats (cattle drinkingwater points); and -11 - (c) installation of gauges and control structures for flow measurementat the distributary head and each mogha (watercourse offtake outlet). iii) Improvemenflrehabilitationof branchcanals,targetingabout25branchcanalssupplyingwater to the distributary canals on which FOs are established. Ingeneral, the works would be similar to those envisagedfor distributarycanals. Inaddition, the following type o fworks wouldbe considered (a) motorization o f regulator gates, where necessary; (b) installationofgauges andcontrolstructures for measuringflows at the headofthe branches and distributary off take points; and (c) installationo f a telecommunication system for monitoring andmanaging flows inbranchcanals to improve water scheduling and safety o f operations. Eligibilitvcriteria for WCAs andFOsto access uroiectresources,andprioritizationcriteria for targeting the above investments at relatively uoorer farmingcommunities have beenprepared(see Annex 2.1) C. ProductivityEnhancementProgram,comprising precise levelingof 100,000 acres (40,000 ha) of farmlandusinglaser guidedequipment; establishmentof some 100demonstration centersto disseminatea fullrange ofimprovedwater managementandirrigationagronomy practicesltechniques; apilotfor volumetric delivery of irrigation water; training o f FOsNCAs inimproved water management, cultural practices andnew technology (landleveling, zero tillage, sprinkler and drip systems, etc.); integrated pest management (IPM), Integrated Plant and Soil Nutrient Management (IPSNM), information systems, markedmarketing, etc. An information systemwouldbe introduced within SIDA, A M s and FOs, including establishmentof 3 pilot informationkiosks. Timely availability anddissemination o f information on expected and actual water availability at barrages, off-takes o fmain and branch canals and distributaries would help inmanaging available water more efficiently andproductively. This system would be especially useful whenthe canal systems are operatedon rotation schedulesto cope with water shortages. D. MonitoringandEvaluation,includingdesignandimplementation of amonitoring andevaluation system and establishment of a spatial GIs database. The M&Esystemwould provide continuous feed back to the implementingagencies on the project performance and assess its physical, agricultural, social, financial/ fiscal, environmental andeconomic impact, so that, corrective actions couldbe undertaken ina timely manner. Detaileddesign of the M&Esystemwill be completed within 3 months o fproject start, and baseline surveys would be carried out as sub-projects for distributaryand minor canal rehabilitation and watercourse improvement are selected. Remote sensingwould be usedwhere appropriate. E. ProjectManagementSupport. This includes the administrative, technical andfinancial management support providedby the office o f Director General Agricultural Engineering andWater Management (DGAEWM), SIDA, the Project CoordinationUnit(PCU), the intemal audit teams, andthe implementation assistance consultants. The implementation assistance consultantsteam wouldprovide support for, inter alia, project launch, supervision (quality assurance), mid-termreview, development o f a project management information system, productivity enhancement, and training & capacity building program for project staff, FOs and WCAs. -12- 4.84 5.7 4.45 7.3 B.ImprovementofIrrigationFacilities: (i)ImprovementofWatercourses 55.87 65.9 37.69 61.6 (ii)Improvementofdistributaries 9.38 11.1 8.47 13.9 (iii)ImprovementofBranchCanals 4.06 4.8 3.64 6.0 C. Productivity Enhancement 5.42 6.4 2.00 3.3 D.Monitoring &Evaluation 1.73 2.0 1.62 2.6 E.Project Management Support 3.47 4.1 3.27 5.3 0.0 0.0 Total Financing Required I 84.77 I 100.0 1 61.14 I 100.0 Retroactive financing to the extent of US$0.5 million equivalent has beenincluded for various project preparation and start-up expenditures incurred after May 31,2003. 2. Key policy and institutional reforms supported by the project: The project supports the ongoing institutional reforms in Sindh that involve decentralizing and redefining the roles o fpublic sector agenciesand farmers inthe O&M o fthe irrigation anddrainage system. The project also supports introductiono f a uniformpolicy for capital sharing inwater sector operations. Until recently there was lack o fa uniform capital cost sharingpolicy in Sindh. There were wide variations in cost sharingarrangementsunderdifferent projects and programs supporting on-farm investments, includmg watercourse improvement. This lack o funiformity not only caused difficulties inproject implementation but also gave the wrong signalsto fanners. InDecember2003, GOSindhhas introducedauniformcapital cost sharing requirementunder all its projects andprograms involvingwatercourse improvement. Under this policy farmers are required to pay up-front 10% o f watercourse construction materials cost and the full cost of skilled andunskilledlabor. These cost sharing arrangementswouldbe reviewedjointly with the Association on an annual basis. 3. Benefits and target population: Tangibleproject benefits include: (i) Higher agricultural output and ruralemployment. As a result o f the project interventions water use efficiency and agronomic practices would improve. Cropping intensitywould increaseby over 10 percent andcrop yields by 5 -10 percent; (ii) Equitabledistributionofwaterthatwouldbenefitfarmersatthetailendsofdistributarycanals and watercourses, encouraging them to invest innon-water inputs and increaseproductivity andincomes; (iii) Increased role of farmers inO&Mthat would lead to more efficient and cost effective O&M; and -13- (iv) Improvedcostrecovery as well as costeffective,efficient andsustainable O&M. With improvedrecovery o f abiana, subsidyfor O&M would gradually decrease. Sharing o f capital cost by farmers would releasepublic sector resources for imgation systemimprovement. Target Population Whde the project would benefit all sections o fthe farming community, it would seek to target the poorer sections. The Project Implementation Framework includes prioritization criteria to help target project interventions to poorer farmers andpromote participation and inclusion o fwomen and tenants inproject supportedinvestment activities. Share croppers, including landlesstenants will benefit directly from the Project. 4. Institutionalandimplementationarrangements: (2.4.1 The Department ofAgriculture (both provincial anddistrict basedformations), SIDNAWBs, and FOsrJVCAs, would implement the project, withsupport from project implementation assistance consultants (PIAC). Under the LocalGovernment Ordinance o f 2001, the Agriculture Department has been decentralized, and among others, water managementfunctions of the Directorate General of Agriculture Engineering andWater Management (DGAEWM) have been devolved to the District Governments. However, according to GOSinms current policy, all externally assistedprojects are coordinated and implementedby the ProvincialGovernment. All implementingagencies have designatedfocal persons responsiblefor project activities under their respectivejurisdictions. The roles and responsibilities o f each agency are summarized below. C.4. 2 The DepartmentofAgriculture -- representedby the DGAEWM-would be the lead implementingagency andhaveoverallresponsibility for: social mobilization to establishWCA andFOs; implementing watercourseimprovements andthe productivity enhancementprogram through WCAs, and FOs; maintaining a MIS/GIS data base for the project; quality assurance; establishing and operating an M&E system; supervising the PIA andM&Econsultants, andcoordinating overallproject activities. The DGAEWMwould carry out watercourseimprovement work through the Director On-Farm Water Management (OFWM). The Director OFWM would have under his supervision 16 District Teams and50 FieldTeams, comprising District Government staff as well as Provincial Government staff. The Directorate General o f Agriculture Extension andResearch(DGAER) would be responsible for implementingIPMandIPSNMrelatedactivities and demonstrations. The Agriculture Information Directorate and the SIDA Media Cell would be responsible for information dissemination anddemand promotion. C.4.3 The SindhIrrigationandDrainageAuthority (SIDA) wouldberesponsible for: registering FOs with the Regulatory Authority, underthe Sin& Water Management Ordinance o f 2002 and entering into Irrigationand Drainage Management transfer Agreements (IDMTAs) with FOs; buildingcapacity o f FOs andprovidingpost-IDMT support; andmaintainingconsolidated project accounts andcontributing to the project's overall MIS/GIS maintained by DGAEWM.The Area Water Boards(AWBs) would be responsiblefor implementingcivil works for improvement o fbranch canals; water scheduling inmainand branch canals; assistingFOs inidentifying, preparing and implementing sub-projects for rehabilitation of distributaqdminor canals; and receivingAWB/SIDA share of abiana from FOs; . C.4.4 Farmer organizations@Os)are legalentities as defined under Sindh Water Management Ordinance o f 2002. The FOs are boundby, and operate inaccordancewith their by-laws. FOs would have a central role inproject implementation. RegisteredFOs who enter into IDMTAswith SIDNAWBs would -14- progressively take over irrigationmanagementfrom the AWBs. They would distributewater among users, collect water charges, maintain income andexpenditure accounts, andcarry out the routine O&M and repairs o f the distributary/minor canals, above the mogha. Initially, FOs would carry out these activities with the support o f AWB staff. After completing the technical assistance andtraining phase, the FOs would carry out these activities themselves. FOs would be eligible for project assistance for improving distributary/minor canals. They would identify, plan and implement distributary improvements. SIDA/AWBs would provide technical assistance (for carrying out surveys, designs and bidding documents). FOswould themselves carry out rehabilitation works costing less than US$30,000 equivalent under community contracts with AWBs. The FOs would have full responsibility for O&M andcollection o f abiana. Under the existing arrangements,FOs retain 40% o f the abiana collected for O&M o fthe distributaqdminor andpass on the remaining 60% to the AWB/SIDA. FOswould also participate inthe productivity enhancementprogram; have access to technology and equipment providedby the project, including laser assistedlandleveling, zero tillage, etc.; be the focal point for all extension related activities; andparticipate inthe managementofthe information kiosks. C.4.5 Watercourse Associations(WCAs) as defined under Sin& Water Management Ordinance of 2002, are groups o fnon- electedfarmers formed for energizing the fanning community andimproving 'I service delivery to undertake voluntary, pro-active andself-help initiatives"...". The WCAs will be registeredby the FOs inAWB areas andby the Regulatory Authority where FOs do not exist. The WCAs will undertake watercourse improvement andconstruction ofwater storage tanks. The FieldTeams (of DGAEWMDirector On-Farm Water Management andDistrict Governments' Water Management units) will beresponsible for carrying out survey anddesign work andsupervision duringconstruction, while WCAs will be responsiblefor procurement o fmaterials and actual construction work. A simple agreement (form o f agreement included inthe PIF') wouldbe signedbetween the DGAEWMand WCAs specifying responsibilities o fboth parties. Monitoring and Evaluation Arrangements C.4.6 The DGAEWM,assistedby M&EConsultants, wouldbe responsiblefor maintaining the M&E database. It would monitor physicalandfinancial progress, analyze keyperformance indicators, and collate quarterly progressreports, for submission to the Project Steering Committee (PSC) andthe Association. The consultantswill establish a spatial GIs database. The M&E systemwould provide continuous feed back to the implementing agencies on the project's performance so that corrective action couldbe undertaken ina timelymanner. Detaileddesign o f the M&E systemwill be completed within 3 months of the start o fthe Project, andbaseline surveys would be carried out as sub-projects for distributary and minor canal rehabilitation andwatercourseimprovement are selected. Progress o f various components would be monitoredas an integral part ofproject implementation. Eachimplementingagency would contribute to the M&E systemmaintainedby the DGAEWM. Impact evaluation studies would focus on: (a) water use efficiency andequity o f distribution; (b) crop yields and intensity; (c) farm income and employment, (d) performance o f FOs/WCAs. Remote sensing would be usedwhere appropriate. Key performance indicators are presentedinAnnex 1. C.4.7 A project launchworkshop wouldbe organized shortly after project approval. The Bankwould supervise the project twice a year, on average. Supervision missions wouldbeundertaken more frequently duringthe first year to help steer the project throughthe initial stages. Besides core skills inirrigation and irrigated agriculture, the Bank task team would have skills insocial development, institutional development, environment, IPMand M&E. C.4.8 A midtermreview (MTR) wouldbe carried out duringthe secondyear o fproject implementation, -15- at which time the governmentwould reviewthe implementation o fthe project with the Association. The midtermreview would evaluatethe overallprogress, assessthe needfor any mid-course corrections, adjustments indesignand scope, implementation approachandmethodology, andrevisit policy aspects including cost sharingto ensure timely completion of the project's activities andsatisfactory outcomes consistent with the development objective. An implementation completion report (ICR) wouldbe prepared withinsix months after the closing date. ProjectManagement Support (2.4.9 Besidesthe administrative, technical and financial management support providedby the office of DGAEWM, SIDA andthe Project Coordination Unit(PCU), the Project provides for Project Implementation Assistance (PIA) Consultants. These consultantswouldprovide support for project launch, supervision (quality assurance), mid-termreview, procurement, development o f a project management informationsystem, training and monitoring. The consultantswould field a multidisciplinary team of senior, mid-andjunior-level professional staff and support staff. A core team will be assignedto work with DGAEWM, SIDA, AWBs and FOs at Hyderabad. Four (4) field teams will be established. Project CoordinationArrangements C.4.10 The Agriculture Department has establisheda small PCUheadedby a ProjectCoordinator (PC) and assistedby a Deputy Project Coordinator (DPC) and support staff. The main role o fthe PC duringthe project preparation and approval phase is to facilitate timely implementation o f critical actions by various agencies andmaintainclose liaison with the Bank. Duringthe project implementation phase, the Project Coordinator wouldfacilitate coordination among implementing agencies andensure timely action onthe feed back providedby internal auditors. The SecretaryAgriculture Department i s currently designatedas the PC. A Project CoordinationCommittee (PCC), headedbythe PC wouldbe responsible for coordination among various agencies and facilitating project implementation. The PCC would have representativeso f SIDA, AWBs and FOs as its members. The DGAEWMwould act as the Secretaryof the PCC. The PCC would meet once every month. Project SteeringCommittee (PSC) C. 4.11 A ProjectSteeringCommittee (PSC) headedby the Additional Chief Secretary Development (ACS Development) and comprising SecretaryAgriculture, SecretaryFinance, the PC, DGAEWM,MD SIDA, Secretary Irrigation, and a representativeo fthe Federal Water Management Cell, would provide policy guidance and monitor overall project outcomes. The PCU will act as the secretariat o fthe PSC. The PSC will meet at least once every quarter or more fiequently whenever issuesrequiring resolution are submittedfor its consideration. The PSC would 0 Review on anannualbasisphysical andfinancial progressreports, evaluate outcomes (including those relating to social and environmental safeguards), ensure consistency o fproject implementation with the Implementation Framework, provide policy guidelines andadvise implementing agencieshow issues affecting implementation canbe overcome; 0 Ensureprovision ofadequatebudgetary allocation for timely implementation ofthe Project andfor operation and maintenance; 0 Resolve issues not settled by the PCC; -16- e Ensureadequacyandcontinuity ofproject managementstaff; and e Ensure that project complies with legal andfinancial covenants, Stakeholders Fora C.4.12 To seek feedback from various stakeholderson the project performance, StakeholdersFora would be establishedinall districts. It would, inter alia, includethe Chairman ofthe Farmer Organization Council, senior representativesofAbadgar Board, Chamber o f Agriculture, District Nazims, representativeso f FOs, WCAs, and members of civil society. The DGAEWM, MD SIDA and Directors of AWBs would periodicallyconvenefeedback sessions. The feedbackprovidedwouldbeminuted and sharedwiththe PCU, PCC, PSC andthe Association. D. Project Rationale 1. Project alternatives considered and reasons for rejection: D.1.1. The following alternativeswere considered: (i) NoProject.Thisoptionwasrejectedbecausewithoutinstitutionalreforms,investmentsin infrastructure improvement andproductivity enhancementmeasures, the sector issues summarized earlier will become more acute andwide spreadandthe alreadyhighpoverty levelwould further increase. (ii) Asset rehabilitation only; institutional reform only; or combination ofthe two. The third alternative has been adoptedbasedon past experience and lessonslearned in the sector. Over the last 20 years, several approaches been havebeentriedto stop the deterioration o f the irrigation systemand improve its performance, but without much success. These approachesincluded: rehabilitationo f assets; increase inwater charges; efforts to improve administrative controls; and enhancement o fbudgets and technical improvements inO&M. Despite significant efforts, collection o frevenuesdid not increaseand the provincial government was unable to provide sufficient funds for O&M. Deferredmaintenance continued to accumulate; quality o firrigation service delivery remainedpoor; systemefficiency remained low; and inequities inthe distributiono f irrigation water and rent seeking behaviors continued. These approaches failed becausethey addressed only the symptoms, not the root cause o fthe problem--a pervasive public sector involvement without meaningful participationo fthe users inoperating and managing the irrigation systemand sharingcosts. (iii) Thelevelatwhichphysicalinterventionandreformsshouldbepursued(e.g. mainsystem, distribution system, or tertiary level). Given that the NDP is supporting reforms and physical interventions at the upper tiers o f the system, the obvious choice was to focus at the tertiary levelwhere there is a large potential for efficiency gains both interms o f water use andproductivity. Interventions at the distribution level are also neededto provide a sound foundation for the upper tiers reforms, and address inequities inwater distribution, which are most severe at the distributary canal level. Without these interventions the WCAs andFOs would inherit a nonfunctionalsystemthat would set themup for failure. (iv) Project's Physical Coverage. The choice is between intensive coverage incanalcommandswhere upper tier reforms are takingplace, versus extensive but sparse coverage over a larger area o f the province. The project impact would clearly be higher inthe first alternative andimplementation would be easier to manage. Moreover the returns would be higher due to better managementand improved equity o f distribution inthe reform areas. Giventhese efficiency considerations, the first option has been adopted. - 1 7 - Due to various considerations,however, GOSindh desires to not exclude other areas from receiving watercourse improvements. Ithas beenagreedthat a limitednumbero f watercourse improvements (not more than 1,400) would be carried out inareas outsideAWBs as well subject to principles and criteria summarized inAnnex 2. Some 200 watercoursesand water tanks would also be improvedinareas outside canal commands that rely on groundwater andrainfall runoff. 2. Major relatedprojectsfinancedby the Bankand/orother development agencies(completed, ongoingandplanned). Latest Supervision Sector Issue Project (PSR) Ratings 1Bank-finance Droiectsonlv) Implementation Development Bank-financed Progress(IP) Objective(DO) Improving efficiency o f water use and On-Farm Water Management S S capital cost recovery Projects, I,11,111,and Command Water Management Rehabilitation o f irrigation systems and Irrigation SystemRehabilitation S S improvements inO&M Projects Iand I1 Rationalization o fpublic expenditures FordwahEastem Sadiqia S S on O&M andcommunity participation (South) Project inirrigationmanagement System improvements, institutional Left Bank Outfall DrainProject S S changes, cost recovery, andcommunity development Community participation, Balochistan Community Minor S S improvements inirrigation facilities and IrrigationProject O&M Institutionalreforms, control o f National Drainage Program U U waterlogging and salinity, improved 1/ water management Other development agencies Improvingefficiency o firrigation ADB andOECF supported systems On-Farm Water Management projects I PlDO Ratings: HS (Highly Satisfactory),S (Satisfactory),U (Unsatisfactory),k I (Highly Unsatisfactory) I If NDP ratingswere basedon performance of individualprovinces, the ratings for Sindh for both IP and DO . . would be satisfactory 3. Lessonslearnedand reflectedin the project design: The project design takes into account important lessons leamed from the Bank'sinvolvement in Palustan'sirrigation anddrainage sector inSin& andPunjab as well inother countries such as Argentina, Chile, the Dominican Republic, Mexico, the Philippines, Andhra Pardeshand Turkey. Key lessons incorporated inthe project design are: (a) Farmer participation inirrigation management is o f central importance for long term sustainability of the irrigation system. Social organization and capacity buildingare key to developing sustainable FOsNVCAs, and empowering them to carry out their functions is essentialto makingthemeffective. Unlikethepast, the FOsNCAs are nowresponsiblefor crucialfunctions inirrigation management, including distribution o f water andcollection o f water charges. FOs would be formed at the - 18- distributary/minor level -- the point where water control lies inPakistan's irrigation system. The FOs would collect water charges, retain part of the proceedsto meet O&M cost andpass the balanceto AWB andSIDA for the O&M ofthe upper tiers ofthe system. FOswould cover sufficiently large areas (an average command area of about 4,500 ha), and would generate sufficient revenue to support a team of technical staff, runan office, andacquire simple machinery neededto carry out O&M ina cost effective mannerandundertakeproductivity enhance measures. A formal InigationDrainage Management TransferAgreement (IDMTA) wouldbe executedbetweenthe AWBs andthe FOs that would clearly define roles andobligations of bothparties. (b) Investments to make the irrigation infrastructure functional and efficient are essentialto enablethe fledgling institutions (WCAs, FOs) to perform andachieve intended outcomes. Underthe project FOsMiCAs wouldbe expectedto participate inplanning, designing, andimplementing the rehabilitation works. WCAs would contribute towards the capital cost o fwatercourse improvements, thereby increasing their stake inthe systemand enhancing their ownership. FOs wouldbe responsible for distributarylevel improvements while WCA would be in-charge of watercourseandon-farm investments. An output basedsystem, describedearlier, wouldbe usedfor improvement of watercourses. FOswould carry out small distributary works (costing up to US$30,000) themselves and be the employer of contractors for larger works with AWB acting as the "Engineer" or "Project Manager". (c) Productivity enhancementmeasures should supplementimprovedwater management inorder to reap the full benefits o f improvedwater managementand equity o fwater distribution. Accordingly, an incisive package for disseminating a full rangeo f water managementpractices and irrigation agronomy techniques at the f m level is included inthe project. (d) Specific lessonsdrawn fromthe NDPproject implementation experience are reflected inthe project design: avoiding a complex and overly ambitious project design andimplementation arrangements; province specific operation rather than a "umbrella" nation-wide program; ensuring early start up by identifying specific investments up-front and ensuringthat first year implementation program and relatedprocurement actions are well advancedby project approval; and clearly delineating responsibilities o f implementingagencies to unleash the full potential and strengthof each agency. 4. Indicationsof borrower commitment andownership: D.4.1 Both GOP andGOSindh are committed to supporting priority investments andinstitutionalreforms inthe water sector. The drought duringthe last four yearshasalso focussedattentiononwater conservation. On the investment front, reducing water losses through watercourseimprovement and improved water management are among GOSindh's top priorities inthe sector. Recently, GOP has also reiteratedits strong support for a nationwide program for watercourse improvement. On the reforms front, a highpowered committee appointedby the President o f Pakistan emphasizedthe critical importance o f institutionalreforms. Sin& is ahead of other provinces inimplementingthese reforms. In2002, a Sindh Water Management Ordinance (SWMO) was promulgated to address shortcomings inthe original legislation @IDA Act 1997) passedin support of the reforms. Significant features o fthe SWMO include the creation o f an independentRegulatory Agency and a mandatory requirement for representationo f small holders andtail-end farmers inFOs. The SIDA has been establishedand is being made operational. Five AWBs havebeennotifiedofwhich 3 are operational. By September2003, over 190FOshadbeen establishedinthe Nara Canal Area Water Board (the first pilot AWB). O&M and abiana revenue collection responsibility hadbeen turned over to over 130 FOs. Programs o f capacity buildingand third party monitoring are being initiated. D.4.2 Another indicationo fGOSindh's commitment to the proposed project is that it allocated its own resourcesto finance project preparation, including an integrated social and environmental assessment -19- (ISEA). The project PC-1 document (government's equivalent of aproject appraisal document), that is basedon this PAD, has beenapprovedby the Executive Committee of the National Economic Council (ECNEC), which is the highest approval forum o f GOP for public sectorprojects. 5. Value added of Banksupportinthis project: Amongst the donors supporting water sector interventions inPakistan, the Bank has a comprehensiveview o f sector development, a strategic focus and the lessons of experienceinimplementing sector wide projects through out the world. The Bank is deeply involved insupporting institutionalreforms as well as formulation of a long term policy and strategy for the water sector. The Bank's experience in Pakistan andits global experience inwater resourcesmanagement,place it ina unique positionto help GOSindh achievethe intendedoutcomes. E. Summary ProjectAnalysis (Detailed assessments are intheproject file, see Annex 8) 1. Economic(see Annex 4): 0 Costbenefit NPV=US$46 million; ERR= 21.O % (see Annex 4) 0 Costeffectiveness 0 Other(specify) E.1.1 The ERRof this project is estimatedat 21%. The ERRis robust and exceeds lo%, even with a simultaneousincreaseo f20% incost and 20% decrease inbenefits. Economic evaluation o f on-farm and canalrehabilitation investmentsinPakistanhas beendone severaltimes over the last 20 years inthe context ofproject appraisal, ICRs, OED audits, and impact evaluation reports. The ERRestimates inthese evaluations ranged from 20% to 35%. The ICR for the ThirdOFWM Project estimated the ERRat 27%. The ERRo fpast imgation systemsrehabilitationprojects was estimated at around 50%. 2. Financial(see Annex 4 andAnnex 5): NPV=US$39 million; FRR = 19 % (see Annex 4) FiscalImpact: E.2.1 The project wouldcontribute to the objective ofmakingSIDA andA M s financially sustainable andhave apositive impact on GOSindhk budget. Duringthe last 5 years overall abiana collection in Sindh was about 78% o fthe amounts assessed. Data from 25 FOs inNara Canal AWB, which have been transferredthe responsibility for collection of abiana, indicates recovery performance ranging from 82% to 100%. With transfer o fmanagemento f distributary canals to FOs, GOSindh's liability for O&M expenditureswill decrease substantially as farmers will bear the O&M costs o f the distributaries. This coupledwith better cost recovery wouldreducethe gap between O&M expenditures andrecovery from abiana. E.2.2 With approximately 21 percent o f the total investment costs fundedby farmers and72 percent by the Association, the government will needto finance less than about 7 percent o ftotal project cost. When taxes andduties that are estimatedto accrueto the govemment due to project activities are taken into account ($4.98 million), the net government contributionwill amount to about 3 percent o f the total project costs. The fiscal impact o fthe project during implementation, therefore, will not place undue financial burden on GOSindh. - 20 - E.2.3 Cost Recovery (a) O&M Costs. WCAs would be responsiblefor bearing O&M cost o fwatercourses, and FOs would be responsiblefor O&M of distributary andminor canals where they have been turnedover to them underIDMTagreements. They will collect abiana, retain 40% o fthe proceeds, and pass on the remaining 60% to AWBs/SIDA for O&M of the uppertiers o f the system. A study carried out in 1997 for the Nara Canal AWB estimatedthat the O&M cost o f distributaries and minors comprises 28% o f the total O&M cost o f the total Nara canal system. Inother canal systems the share o f the O&M cost for the distributary canals is much larger. Thus the transfer o fthe distributary maintenanceto FOs would reducethe O&M cost incurredby GOSindhby a higher percentage. (b) CapitalCost Sharing.Untilrecently there was lack ofauniformcapital cost sharingpolicy in Sindh. There were wide variations incost sharing arrangementsunder differentprojects and programs supporting on-farm investments, including watercourseimprovement. This lack of uniformitynot only causeddifficulties inproject implementation but also gave the wrong signalsto farmers. InDecember 2003, GOSindh introduced a uniformcapital cost sharingpolicy for projects andprograms involving watercourse improvement. Underthis policy farmers are required to pay up-front 10%o f watercourse construction materials cost and the full cost o f skilled and unskilled labor. This would result inWCA's share inthe capital cost equivalent to about 30% for watercourses in SGW areas, and about 31% for watercourses inFGW areas. This cost sharing policy would be reviewed iointlv with the Association on an annualbasis. Cost sharingfor other project componentshas beenagreedas follows: (i)DistributaryandMinorCanalImprovements. For the time being, GOSindh does not intend to require f m e r contributionto distributary canal improvements. This is basedon the rationale that most distributaryandminor canals have considerableaccumulated deferred maintenance. Since O&M was the responsibility o f GOSindh, it would be unfair to transfer deteriorated channels to FOs and expect themto invest their own resourcesinrehabilitation and modernization. (ii)BranchCanals. O&M ofbranchcanalsis the responsibilityofAWB or SIDA. SinceFOs pay a part o f the abiana they collect, for maintenance o f the irrigation systemabovethe distributary canals, they will not be requiredto share the capital cost ofrehabilitationofbranch canals. (iii) EquipmentforLandLeveling.Thereturnsfromprecisionlandleveling(PLL)--25% Laser to 30% water savings-- are well known andthere appears to be a growing demand for this technology. The Project will provide laserbasedlandlevelingequipment to FOs on cost sharing basis. To promote this technology, GOSindh will provide a matching grant equivalent to 50% o f the cost ofthe equipment; the balance50% wouldbe borne by FOs.Initiallythe title ofthe laser equipmentwill beheldinthejoint names ofGOSindh (representedbythe DGAEWM) andthe concernedFOs. The GOSindh share inthe cost of the equipment will be gradually transferred to the FOsupon achievement o f specified physical targets. The project will train operators of the laser equipment.The DGAEWMwill monitorthe targets and ensure that the equipment is used judiciously and small farmers also have access to the equipment. -21 - 3. Technical: E.3.1 The project does not involve introduction of complex new technologies.The implementingagencies andcontractors as well as farmersare well familiar with watercourse improvements and canal rehabilitation works. However, introduction of GIs, remote sensing, demonstration o f technology for improvedwater management, improved agronomic practices, and establishment of Information Kiosks would require technical assistanceandtraining, which will beprovidedunder the Project. 4. Institutional: E.4.1 GOSindh andthe agencies responsiblefor project implementation (see below) have considerable past experience o f similar projects. The Planningand Development Department is the overseer o f all development activities in Sindhandwill perform this function for this project as well. It ensures timely release o f funds and addresses policy issues affecting implementation. Specifically for this project, the PSC, headedby the Additional Chief Secretary (Development) andwith Secretarieso f Finance, Agriculture, and IrrigationDepartments, MD SIDA, a memberof the Federal Management Cell, and DGAEWMas itmembers, hasbeennotifiedto oversee implementationandprovidepolicy guidance. E.4.2 The Agriculture Department (representedby the DGAEWM),the lead implementing agency, has implementedfive projects andprogramsinthe past involving watercourse andon-farm improvements. The DGAEWMalso possesses considerableexperienceinestablishmentofFOs at the distributary canal level. Indeedthe DGAEWMhas to its credit the establishment o f a large majority o f the existing FOs inSindh. E.4.3 SIDA andAWBs are at the center stage of, and key players in, the ongoing institutional reforms in Sindh. Although still young andinthe formative stage, they aspire to become modem and forward looking organizations. SIDA has recruited good quality staff from the marketfor various key positions while AWBs have staffinherited fromthe IrrigationDepartmentwho have considerablepast experience in irrigation system O&M as well as rehabilitation schemes. Currently both SIDA andAWBs have accessto considerabletechnical assistance for reforms (change management) and for planning andimplementing investments. They are already undertaking a substantialprogram o f investment under the NDP and are fully exposedto Bankguidelines andproceduresfor procurement, financial managementandmonitoring. E.4.4 FOs and WCA are legal entities as defined under the Sindh Water Management Ordinance 2002. Most o f the FOs andthe WCAs are nascentorganizations and need training and capacity building. E.4.5 The project includes componentsfor Project Management Support andfor M&Ethat would cover aspects including procurement, financialmanagement, quality control as well as training. Key areas in whch the project will provide training and capacity buildingfor WCAs andFOs include: financial management (book keepingandaccounting), crop assessment andcollection o f abiana, businessplanning, O&M, water measurementandmanagement,productivity enhancement, communication anddispute resolution, etc. E.4.6 The project wouldcreate an enabling environment for the implementingagenciesto work as partners. As mentionedinparagraphC.4.10 the Project CoordinationCommittee (PCC) will serve important roles inensuring good coordination and collaboration amongst various agencies. A Stakeholders Forum comprising Chairman o f the Farmer Organization Council, senior representativeso fAbadgar Board, Chamber of Agriculture, District Nazims, representativeso f FOs, WCAs, andmembers o f civil society will be establishedto provide feed back to the implementingagenciesfrom the stakeholders' perspective. - 22 - 4.1 Executing agencies: E.4.1.1 The mainexecuting agencies are: The SindhAgriculture Department representedby the DGAEWM, Director OFWM, DGAER, Directorate o fInformation, and Executive District Officers for Water Management 0 The Sindh IrrigationandDrainage Authority (SIDA) 0 The Area Water Boards 0 WCAs and FOs 4.2 Project management: E.4.2.1 The DGAEWMwouldbe the leadimplementingagency andholdresponsibility for: social mobilization for establishing WCAs and FOs; providing technical assistance to, and contracting with WCAs, for watercourseimprovement works; productivity enhancementdemonstrations incollaboration with the Directorate-General ofAgriculture Extension and Directorate ofInformation; andM&E. District government staff responsiblefor on-farm water managementprograms will work underthe overall coordination and technical supervision o f the DGAEWM. The DGAEWMis hiring additional staffto supplementthe implementation capacity ofthe District basedstaff. E.4.2.2 SIDA wouldbe responsible for registeringFOs with the Regulatory Authority and for buildingthe capacity o f FOs. AWBs would be responsible for rehabilitating branch canals, assisting FOs inidentifying, planningandimplementingdistributarylevelimprovements,andperformingthe functions ofthe "Engineer"/Project Manager for these contracts. E.4.2.3 FOswould be responsible for O&M o ftheir distributarycanals, collection o f abiana, undertaking small (up to US$30,000) distributary rehabilitation investmentsundercommunity contracts, employ contractors for contracts o f larger value andacquiring andoperating andmaintaining land leveling equipment. E.4.2.4 WCAs would enter into "output based'' agreements with DGAEWMfor improvement o f watercourses, assist FOs in abiana collection, operateand maintainwatercourses, and participate in productivity enhancementdemonstrations, IPM, andIPSNMpilots. The project wouldprovidetechnical assistanceto the implementingagencies for: Preparation o ftraining and capacity buildingprograms for FOs andproject staff. Engineeringservices for surveys, designs, construction supervision & quality assurance ofcivil works. Procurement support. DesigningandimplementingaProductivityEnhancementProgram, to complement the physical improvements supportedby the project. While this programwould be focused at the FOs and WCAs, it would also provide technical assistance to SIDA, AWBs, DGAEWMand the Directorate-General o fAgriculture Extension and Directorate o f Agriculture Information. Designingandimplementingan M&Eprogram for the project, including establishment o fa spatial GIS database anduse o fremote sensing. - 23 - 4.3 Procurement issues: E.4.3.1 Procurement of goods and civil works will be carried out inaccordancewith the Bank's Procurement Guidelines, and procurement of consultants'services inaccordancewith the Consultants' Guidelines. The Bank has camed out a procurement capacity assessmentof the implementingagencies and reachedagreement with the Governmento f Sindh on implementation of strengtheningmeasures, where necessary. Project-specific procurement arrangements have been developed, taking into consideration the nature o f the procurement andthe procurementcapacity o f the implementing agencies. Procurementplans havebeenpreparedby the implementingagencies andreviewedby the Bank. Procurementprocessof the keyfirst year contracts is at anadvancedstage anddisbursementcan commenceimmediately upon effectiveness. Details o f the procurement arrangementsare providedinAnnex-6. 4.4 Financialmanagementissues: E.4.4.1 The project will be implemented by two core agencies (DGAEWMand SIDA) at the provincial level andwill involve substantial contribution of funds by the borrower andlocal farmer organizations. The recruitment and inductiono f qualified staff, installation o f an accounting operations system, establishment o f an intemal audit function, and use of a chart of accountswhich conforms to the requirementso f the Government, as well as havingthe capability to provide the requiredfinancial information consistent with the Bank's reporting requirements, are key steps agreedduringthe assessment. The Bankfunds would be disbursedthrough the two major implementingagencies whichwill each provide separateannual audited accounts for consolidation by a ChiefFinancial Coordinator in SIDA. A financial managementmanual for the project has beenpreparedandcontains detailed procedural guidelines to be followed during implementation. This manual has beenreviewed to allow for conformity with the government's new instructions regarding the use o f Revolving FundAccounts, involvement o f State Bank o f Pakistan (SBP), Accountant General (AG) and the Project Coordinator. The project shall, however, prepareaccounts on the cashbasis of accounting and, at the same time, supply informationon outstanding commitments andobligations at the end of each reporting period. E.4.4.2 The Government of Pakistanis taking fminitiatives within the context o fthe Country Financial Accountability Assessment(CFAA) to identifythe salient lapses inits accountability process andhence map-out, within its reform agenda, the hdamentalactions required to improve the financial management systems inthe country. As a further step to clearly delineate the specific weaknesses inthe financial managementarena inthe Sindh Province, andas a sign o f commitment to the wider spectrum o f financial accountability framework, a Province FinancialAccountability Assessment (PFAA) has been carried out for the Province under the auspices of the Bank. The dialogue on the outcome o fthe assessment is continuing with the Province through a series o fworkshops with stakeholdersandinitial signals indicate that the Provincial Government is committedto reforms particularly inthe FMarea. With the gradual and phasedimplementation o f the Bank funded `Project to Improve FinancialReporting andAuditing' (PIFRA) gaining increasedmomentum, the mediumterm overall government-wide financial accounting, reporting andauditing objectives will be achieved. For the moment, however, an accounting systemwill be installed andmaintainedby adequately qualified accounting staff inboth DGAEWMand SIDA andthe annual accounts o fthe project shall be audited by the Office o fthe Auditor General o f Pakistan. E.4.4.3 The Draft Sindh PFAA andthe CFAA recognize that the intemal audit is dormant inthe governmentagencies. To reinforce operational control ineach o f the two implementing agenciesofthe project, an intemal audit function shall be establishedinthe DGAEWMand report directly to the Project Coordinator. This will serve as an integral component of good financial govemance inthe project. - 24 - 5. Environmental: Environmental Category: B (Partial Assessment) 5.1 Summarize the steps undertakenfor environmental assessmentandEMP preparation (including consultation and disclosure) andthe significant issues and their treatment emerging from this analysis. E.5.1.1 GOSindhhas carried out an IntegratedSocial and Environmental Assessment(ISEA) to assess the impacts o fproject activities on natural habitats, land and soil, access of women and landless communities to water, andincreasedpesticide use onpublic health, and suggest mitigationmeasures. E.5.1.2 There are anumber o fprotected areas, including game reserves, wildlife sanctuaries and wetland sites that fall within the irrigated areas in Sindh, and couldpotentially become a part o f the project area. Prominent among these are the NaraGame Reserve, Nara Desert Wildlife Sanctuary, andTakkar Wildlife Sanctuary inthe Khairpur district, andthe Ranno f Katch Wildlife Sanctuary inthe districts o f Badin and Tharparkar. The wetland sites generally cover areas o f less than 5,000 ha each, and are typically generated bythe accumulation of seepage from major canals, surfacerunoffanddirect inflows from surfacedrains. Species o f concern include marsh crocodiles and migratorybirds that use these areas as winter refuges on migratory routes. E.5.1.3 Project interventions will be confined to establishedirrigatedareas, andrehabilitationworks will categorically be limitedto landthat has already beenunder cultivation. Seepage from watercourses accounts for a very low portiono fwetland recharge. The project does not involve the lining o f canals, and less than 30% o f the lengtho f the watercourseswill be lined. Sinceno new landdevelopment i s expected, and the project activities are not expectedto impact the seepage of water into the wetlands, the project is not expectedto have any adverse or beneficial impact on wildlife and natural habitats. E.5.1.4 The overall impact o fthe project on the environment andon rural livelihood is expectedto be positive. The likelihood of the following impacts, however, is assessed inthe ISEA: (i) the impact of soil andsilt removalanddisposalduringrehabilitation activities, which may contaminate soils, community wells, andwater ponds, and block the natural drainage; (ii) use of lined sections o f watercourses for washing o fclothes; (iii) increaseduse o f chemical pesticidesharminghumanhealth andthe environment; (iv) some tree clearing that mayberequiredwhere watercoursesneedto be realigned; (v) lack of participationo f small, tail-end and women farmers inWCAs and FOs; and (vi) sharecroppers obligedto work for watercourse improvements without being paid. E.5.1.5 With the exception o f the impacts associatedwith increaseduse o fpesticides andfertilizers on water quality, the significance o f the environmental impacts identified andassessed inthe ISEA is limited andmanageablethrough simple mitigationandmanagementmeasures. 5.2 What are the mainfeatures o f the EMP andare they adequate? E.5.2.1 The EMPpresentedinthe ISEA, andthe Implementation Framework include measuresto mitigate the impacts, andto enhance the quality o f environment where possible. These include: (i) disposal or safe recycling o f silt for agricultural purposes and construction o f washing bays and cattle baths to avoid water pollution; (ii) setting specifications for the quality o fborrow earth to avoid deterioration inthe quality o f existing soil; (iii)implementing a pest management plan; (iv) avoiding cutting o ftrees as far as possible, andwhere essential, plantingat leastdouble the number to replace; (v) enhancingthe skills and abilities of farmers, through training innew technologies, better water managementpractices, andinassessing and collecting abiana; (vi) empowering communities, including women, through improvedparticipation opportunities inWCAs and FOs; (vii) incorporating mechanisms that recognize andpay for labor contributed by sharecroppers; (viii) strengtheningthe institutional capacity o f WCAs andFOs; (ix) reducing conflict and improving social relationship between farmers at the head and tail-ends o f canals and - 25 - watercourses; and (x) improvingnetworking amongWCAs, FOs, area water boards (AWBs), community organizations and NGOs. 5.3 For Category A andB projects, timeline and status of EA: Date of receipt o f final draft: July 24,2003 E.5.3.1 GOSindh submittedthe ISEA to the Sindh Environmental ProtectionAgency (SEPA) for review andclearance. SEPA clearedthe ISEA, with the condition that any works carried out inprotectedareas will require clearance from the provincial Wildlife Department (SEPA letter inproject file). 5.4 How have stakeholders beenconsulted at the stage o f (a) environmental screeningand(b) draft EA report on the environmental impacts and proposedenvironment managementplan? Describe mechanisms of consultation that were usedand which groups were consulted? E.5.4.1 Extensive consultations with NGOs, civil society organizations, menandwomen sharecroppers, government officials andother stakeholdersand intendedbeneficiaries were carried out duringthe preparation ofthe ISEA andImplementation Framework. These includedfield investigations, focus group discussions,key informant discussions,household surveys and, village profiles, basedon which the EMP was prepared. 5.5 What mechanismshave beenestablishedto monitor and evaluate the impact o f the project on the environment? Do the indicators reflect the objectives and results of the EMP? E.5.5.1 The ISEA provides a monitoring andevaluation strategy which allocates responsibility for environmental managementamong three groups, with some overlapping: a. The executing agency(ies), andthe project implementation assistance (PIA) consultantsresponsible for providing design options, biddingkontract documents and standardspecifications; the WCA responsible for executing watercourserehabilitation works; the Agriculture Extension Wing o f the Agriculture Department for executing the Pest Management Plan; and the contractors responsible for distributaryhranch canal improvement. b. The supervising agency(ies), i.e., fieldteams ofthe DGAEWM, headedby a deputy district officer or assistantdirector responsible for providing surveys, designs, approvals and supervision for watercourse rehabilitation works andmitigationmeasures; the SIDA and AWB responsible for supervising rehabilitation works; andthe PIA consultantsresponsible for supervising the contractors' distributaryhranchcanal improvement works. c. The monitoring agency(ies), i.e., the project steeringcommittee responsible for monitoring the overall implementation o fmitigationmeasures, assistedby the DGAEWM, SIDNAWB, andM&E consultants. E.5.5.2 The impact o f project activities on land, water quality, vegetation and naturalhabitats is not expectedto be at a significant level. The proposed arrangementsfor supervision, monitoring andevaluation ofmitigationmeasureswill ensure that the potential impacts, ifany, are minimized andto the extent possible, the quality o f environment is enhancedthrough reduction o f pollutionassociatedwith the use of pesticidesandmanagemento f canal water use for purposesother than irrigation by communities. Specific indicators for pest managementaspects are included inthe PMP (see Annex 11) 6. Social: 6.1 Summarizekey social issues relevant to the project objectives, and specify the project's social development outcomes. E.6.1.1 Key socialissuesrelevant to the project which havebeendescribedindetailunderearlier sections of this PAD include the following: 0 the feudal structure that dominates rural society; - 26 - 0 the acutely disadvantaged position o f women; 0 the marginalizedand low social status o ftenants and sharecroppers andthe possibility o f them being used as unpaidlabor to implement subprojects; 0 institutions dominated by large and powerful landowners; 0 government departments not catering to the needs o f the poor; and 0 the highincidence o frural poverty. E.6.1.2 Inspite o f the overwhelming nature of the social issues prevailing inrural Sindh, the project attempts to ensure that the interests o f the poor, the marginalized andwomen are better served. It does this by takingan incremental approach acceptingthat change may not be forthcoming inthe short term, and fosters change by offering incentives and higher ratings to those institutions that include small and tail farmers, sharecroppers andwomen. Specific social development outcomes o f the project include the following: 0 The equitable sharing o f project benefits by small andtail-end farmers through their inclusion and participation inthe WCAs and FOs 0 The equitable sharing ofproject benefits by women farmers through their inclusion and participation inthe WCAs and FOs 0 The reduction o fm a l poverty, by increased incomes o f the poor and landless through better agricultural productivity and opportunity to take part inother activities due to reduced time spent on imgating fields andmaintaining unimprovedwatercourses 0 The enhanced status o f the sharecroppers by encouraging their participation inWCAs and by ensuring that their labor is recognized andpaid for on any subproject implementation activity 0 An On-Farm Water Management Department that is more sensitive to the needs ofthe poor 6.2 Participatory Approach: H o w are key stakeholders participating inthe project? E.6.2.1 Basedonthe findings ofthe ISEA a framework for participation has been developed that defines all the stakeholders, their roles andresponsibilities, as well as ground rules for participation under the project. These include the following: Eligibility Criteria and Legal Framework. The SWMO 2002 defines FOs as corporate bodies that are to be formally registeredwith the Regulatory Authority. It, inter alia, makes the following key stipulations for FOs: 0 At least 213 (two thirds) o fthe command area inthejurisdiction o fFOsmustbe coveredbyWCAs 0 The General Body ofFOs musthave at least 21 members from WCAs or Drainage Beneficiary Groups (DBGs) 0 Of the total of 6 members o fthe FOs' Board o fManagement, at least 3 members shall be representatives o f WCAs or DBGs from the tail reaches o f the distributary or minor or shall be small farmers with holding less than 16 acres. Accordingly, subprojects would be selected based on eligibility criteria that include: i)the WCA meeting the legal conditions o fthe SWMO 2002; ii)the WCA has an elected management committee; iii)the WCA has a bank account; and iv) the W C A submits to the DGAEWMthe complete record o f landholdings of its members. Ifthe subproject passesthe eligibility criteria it will be screened and would be taken up for implementation ifit secures a pass score from a screening rating, which would also rank applicants incase the demand is high (see Annex 2.1). - 27 - Participation of Small and Tail-EndFarmers The screeningratings andranlungsthat promote greater equity, inclusionandparticipationof small tail farmers include the following: e Location o f watercourseon the distributw. Since watercourses on the tail-end of distributary canals usually face higher water shortages, they will be given a higher score and priority in comparison to the watercourseslocated at the headandmiddle. e Presence o f Small Farmers. To assist small farmers, priority will be given to those watercourses where proportiono f small farmers (Le. those holding less than 16 acres) are high. e Particbation percentage o f farmers. The Sindh Water Management Ordinance (SWMO) 2002 recognizes a WCA if66% of the farmers agree to form a WCA. However, the project would give a higher rankingandpriority to those WCA which have a higher percentagethan that mandatedby the Ordinance, The closer they are to 100%farmers participating the higher the score. Participation of WomenFarmers The participation of women farmers inWCAs i s encouragedand subprojects rankedhigher ifwomen are included inWCA membership. The screeningratings do this by givinga bonus o f five points to those institutions that include women farmers. Participation of Sharecroppers Participation by sharecroppersinWCAs is very important as their links with water are profound, and would make WCAs more viable, inclusive and equitable institutions. However, this is also a real challenge. Duringproject andISEApreparation greatreluctance was expressedbymany about the inclusion of sharecroppersinthese institutions. This reluctance was basedon the following:( i)the SWMO 2002 does not expressly give this rightto sharecroppers;(ii) as sharecroppersare transient innature, moving from place to place it wouldnot be practical to include them; (iii) as sharecroppersdidnot own landthey had no stake inthe system, andlining ofwatercourses was the responsibility o f the landlord, inany case; and (iv) as the sharecropperhada lower social status and lackedconfidence helshe would not be able to contribute meaningfully and their participationwould at best be cosmetic. The ISEA ground truthedandexplored these points further with various stakeholders andcame up with the following: i)LegalStatus: TheSWMO2002wasamajorstepforwardtowardsmalungWCAsandFOsmore participatory andinclusive o f small and tail end farmers. However, the SWMO 2002 recognizes only one set o f tenants, i.e. leaseholders, and gives them the right of membershipto WCAs. Therefore, it would be inthe spiritofthelawtohavetenantsharecroppers,includedinthese institutions aswell. Andasmost personsagreedonce there was legalprovision to include sharecroppersit would substantially increasethe pressure to include them as WCA members. Project designresponse: As the SWMO was a relatively new and far reaching piece o f legislationit was felt that it wouldnot be appropriate at the presenttime to seek its amendment, which could be pursued at a later stage. However, to encourageWCAs to include sharecroppersthe screening rating gives a bonus of five points to subprojectsproposedby suchWCAs. ii)TransientnatureoftheSharecropper: Withregardstothetransientnatureofsharecroppers,thiswas not found to be the case by the ISEA team, as nearly all the sharecroppersinterviewed hadbeen tenants rangingfrom aminimumo fsevenyears to severalgenerations. It was infact the wage laborer who have the transient nature, moving insearcho f employment. The problem of the sharecropperswas not that they movedfrom farm to farm but that their movements were within farms on pieces o f landthat they cultivated, infact the practice seemed to be that they were not allowed to cultivate the same piece for more thanthree years (after which it wouldnot be easy to evict themunderthe law). However, even ifthey did stay inaplace for more than three years it was almost impossible to tell this from the revenue records, as to - 28 - whch sharecropper worked on which piece of land. Project design response: With regardsto the updating of revenue and cadastralrecords to give sharecroppersbetter security, it was felt to be beyondthe scope ofthe project andtherefore, not being addressedby it. iii)Sharecropperasstakeholder: Thoughthesharecroppersdidnotownlandtheydidhaveamajorstakein the system, as their incomes dependedon the yields o f the landthey cultivated and also because it was their responsibility to maintainthe watercourse. As a matter of fact, the ISEA team found that there was a much hgherdemandfrom the sharecropperfor watercoursesliningthen the landlordas they appreciatedthe time and water savings that this resulted in; and inthis regardthere were severalrequeststo the team to encouragelandlords to improve their watercourses. Proiect design response: This i s the first project that recognizes sharecroppersas genuine stakeholders in the irrigation system and is encouragingtheir participation through means as describedbelow. iv) Meaningful participationbv Sharecropper: Severalpeopleremained skeptical ofmeaningful participationby sharecroppers inthe WCA andFOs and mentioned that a more practicalapproach would be to have separate organizations of menandwomen sharecroppers through which they could interface with landlords andthis arrangementcouldbe apreludeto full membership inWCAs and FOs. Inthis regardvillages inthe WCA area couldform their village organizations (there may already be severalsuch organizations inexistence). The advantage o f this systemwould be that sharecropperswouldbe empoweredover time as they gain inresources and self confidence. However, others maintainedthat change andempowerment takes time andevena token presence on the formal institutions representedan important step. Infact the ideal situation seemed to be to combine both, i.e. have sharecropperson the formal institutions as well as develop their own. Proiect design response: The project takes both approaches, on the one handranking higher those formal institutions that include sharecroppers amongst their midst and on the other recognizing informal sharecropperorganizations by encouraging themto take on contracts for subproject work. 6.3 How does the project involve consultationsor collaboration with NGOsor other civil society organizations? E.6.3.1 Extensive consultations with NGOs, civil society organizations, menand women sharecroppers, government officials and other stakeholdersand intendedbeneficiaries were carried out duringthe ISEA preparation. These consultations included field investigations, focus group discussions, key informant dlscussions,household surveys and, village profiles, basedon which the project was designed. Similar consultationswill be continued andmainstreamedduring the course o fproject implementation, partly through the Stakeholders Fora. Moreover, the project intends usingNGOs and civil society organizations for training and capacity buildingo f government officials andWCA, FO and AWB membersspecially on participatory techniques, community mobilization and gender issues. 6.4 What institutional arrangementshave beenprovidedto ensure the project achieves its social development outcomes? E.6.4.1 The DGAEWM, the leadproject implementing agency, will also be responsible for social mobilization. Its role will be complementedandsupportedby the Project ImplementationAssistance (PIA) Consultants, and other institutions including SIDA, AWB, FOs andWCAs. Together they will be responsiblefor ensuringthat the project achievesits social development outcomes. FieldTeams would mobilize farmers and encouragetheir formation into WCAs and assistwith their registration. To ensure wider knowledge about the project and transparency, a communication strategy would be developed that would include dissemination o f information about the project, criteria for screening and selecting sub-projects, implementing them andproviding training and capacity buildingsupport. Once WCAs are - 29 - registered andsubprojectsapproved, takinginto considerationsall the rankingand screeningcriteria describedunder 6.2.1, subprojectimplementation through the new output basedsystemwould also better ensure that the project's social developmentoutcomes specially with regardsto payments to sharecroppers are achieved. E.6.4.2 Following formation o f the WCA and FOs, these institutions will be provided hrthertraining and capacity buildingto ensure that these institutions are better govemed andmanaged, have transparent decision making and financial systems andmost importantly that they are participatory and equitable. This i s expectedto be a long term and continuous processwhich would be initiatedby the DGAEWMbut is expectedto be carried forward by SIDA and AWBs as part o ftheir core mandate. 6.5 How will the project monitor performanceinterms o f social developmentoutcomes? E.6.5.1 A monitoringand evaluation framework has beendevelopedby the ISEAunderwhich social development outcomes havebeenidentified. Social developmentoutcomeswould include amongst others: Outcome -Indicator-Baseline 0 Small & Tail FarmersincludedinWCA/FO--Membership inWCNFO--Current membership 0 Sharecroppersincome increased--Increasedconsumption-- Presentincome/expenditure 0 Women status enhanced-- Participation indecision makindmembershipinWCAs & FOs- Present status 0 Sharecroppersparticipating--Membership inWCA--Present status These outcomes wouldbe monitoredby the DGAEWMsupportedby the Monitoring andEvaluation Consultants. 7. Safeguard Policies: 7.2 Describe provisions made by the project to ensure compliance with applicable safeguardpolicies. E.7.2.1 The Departmentof Agriculture, representedby the DGAEWM,will have overall responsibility for ensuringthat the environmental andsocial criteria of the project are met. The DGAEWMwill be supportedby SIDA, AWBs, FOs andWCAs. Capacity to managethe environmental and social impacts as envisagedinthe ISEA will be enhanced, particularly inareas of conflict management, gender sensitivity, andpoverty analysis. Theproject provides hndingofthe PIA andM&Econsultantsto support the DGAEWM inachieving compliance with the environmental andsocial objectives ofthe ISEA. The PSC will monitor overall compliance with the Implementation Framework. E. 7.2.2 The ISEA was clearedby the Sindh EnvironmentalProtection Agency (SEPA) subject to: (i) - 30 - implementation o f the recommendedmeasuresto mitigate environmental risks, (ii) monitoring o f the implementation o f these measures, (iii) disclosureo fthe results of suchmonitoring, and (iv) clearanceof the Sindh Wildlife Department (SWD) for activities that may be carried inprotected areas. To ensure implementation o fthe provisions ofthe ISEA andthe conditions o f approval by SEPA, a set o f environmental guidelines, checklists, andreporting formats has beenprepared. The ISEA recommendationshave already beenincorporated inthe Output BasedAgreements for Watercourse improvements. Ithas beenagreedthat: The DGAEWMand SIDA will provide the Environmental Guidelinesto the OFWM andAWB staff as well as the Project Implementation Assistance and M&EConsultants for application insurvey and design activities, and for inclusiono f appropriate clauses inthe bidding documents for the rehabilitation o f distributary/minor and branch canals. SIDA will also ensure that the relevant provisions o fthe Guidelines are incorporated inthe IDMTA that is currently beingrevised. AWBs andFOs will require construction contractorsto comply with the environmental guidelines, provisions of the ISEA, and conditions o f approval grantedby SEPA. As requiredby SEPA, monitoring reports covering the environmental managementaspects, includingdetails o f deviations andnon-compliances observed, will be submittedto SEPA on a quarterly basis. The responsibility for completion of these reportswill be included inthe Terms o f Referenceofthe PIA andMonitoring andEvaluationConsultants. Inaddition to providing the reports to SEPA and SWD (incaseworks are to beexecutedinprotected areas), they will also bemadepubliclyavailable ona Governmentwebsite. E.7.2.3 PestManagementPlan. The use of pesticidesinthe project area could increaseas project interventions improve availability of water with correspondingincreaseincropping intensity. A Pest ManagementPlan (PMP) has, therefore, beenpreparedto rationalize the use o fpesticides inthe project area. The NationalAgricultural ResearchCenter (NARC), with support from FAO, is currently implementingaNational IntegratedPest Management(IPM) Project. The Sin& Departmentof Agriculture is an active participant inthis program, and has so far trained over 3,000 farmers inIPM technology. Recently, a NationalIPMproject o fmuch larger size hasbeen approvedby the federal governmentunderwhich 55,000 farmers would be similarly trained. To rationalize the use o f chemical pesticides, the PMP adoptsthe strategy o fpromoting IPMinthe project area, besides introducing the concept of Integrated Plant and Soil NutrientManagement (IPSNM) to reduce the use o f chemical fertilizers. The mainactivities under the PMP wouldbe training o f f m e r s inI P Mpractices, introduction o f IPSNM, monitoring o fpesticide residues on selectedcrops (horticulture produce/vegetables), and disseminationof information, which would be undertakenas a part o f the productivity enhancement component o fthe project. The project would, straightaway, start implementinga pilot operation constituting activities other than the training o f farmers while a decision about training o f farmers inIPM would beundertaken after an appraisal o fthe initialperformance o fthe National IPMproject. The PMP would be implementedby the DGAERinclose collaboration with WCAs andFOs, andthe activities under it wouldbe monitored as part ofthe monitoring andevaluation ofthe project. E.7.2.4 ProjectsinInternationalWaterways: Since the Project is to be carriedout on irrigation channelswhich receive water from the Indusriver - aninternational waterway - OP 7.50 is triggered. However, the Project is essentially to rehabilitate existing irrigation facilities, and the Project works and activities are not expectedto exceedthe original scheme, or change its nature, or so alter or expandits -31 - scope or extent as to make it appear a new or different scheme. Giventhe nature o f those works, it is believed that the Project will not (a) adversely affect the quality or quantity o f water flows to other riparians, and (b) be adversely affected by other riparians' water use. Also, the Project will not cause interference with the waters of any of the rivers coveredby the India-Pakistan IndusWaters Treaty o f 1960 and will not affect the other riparian materially. Therefore, no extemal notification(to other riparians) is requiredunder OP 7.50. F. Sustainability and Risks 1. Sustainability: F.1.1 The ongoing institutional reforms in Sindhinvolve establishingcommercially oriented and self-sustaining AWBs, promotingbeneficiary ownership, and O&M o f the systems through formally organized andempowered FOs. The project will complement these reforms and provide a solid foundation for themby establishing more WCAs and FOs andbuildingtheir capacity; supporting highpayoff infrastructure investments as well as productivity enhancementmeasures; and fostering a culture o f meeting an appropriate part o f O&M costs andpart o f capital costs through user fees and cost sharing. This wouldhelp createan enabling environment for fiscal, institutional, financial andphysical sustainability o f Sindh's irrigation and drainage system. 2. CriticalRisks (reflecting the failure of critical assumptions found inthe fourth column o f Annex 1): Risk Risk Rating Risk Mitigation Measure ?om Outputs to Objective i(i)Powerful rural elite may dominate S A (i) SWMO 2002 requires FOs to be The heWCAs, FOs and use these democratic. The Project Implementation rganizations to expandtheir influence. Framework is also designed to mitigate this risk. For example, the project gives priority to: tail-end watercoursesanddistributaries insaline groundwater areas --that have a higher incidence of poverty; those with a higher proportiono f small holders; andthose that have higher participationby farmers. These factors are expected to foster greaterparticipation. An independentmonitoringprogramwould assess the effectiveness of FOs and make changes, as required. A (ii) DGAEWMandAWBs may not S A (ii) project provides for technical The have the capacity to foster and work with assistance to DGAEWMandSIDA for the FOs ina responsivemanner. preparation and implementation o f a quality social mobilizationand capacity building program. A. (iii)GOSindh may waiver inthe H A (iii). GOSindhhas demonstratedcontinued implementation o fthe ongoing commitment to the reforms, particularly inthe 3 institutionalreforms. Irrigation AWBs already established. Capacity building Departmentstaffinheritedby the AWBs and changemanagementissues relating to may have a conflict of interest with FOs AWBs are beingaddressedunder the NDP. and the latter may be frustrated or lose Professional staff is beinghiredfrom the market I interest. for keypositions of the AWBs. Despite these mitigation measures, the riskremains that the - 32 - I reformprocesscould slow down or be de-railed ifchampionsofreformsare somehowsidelined. B.Drought andpoor water availability in B.The project would disseminateappropriate the canal systemmay discourage farmers messagesto farmers highlightingthat from makmginvestments inwatercourse investments inwatercoursesand distributary anddistributarylevel improvements. canal improvement would help mitigate the negative impacts o f drought. C. Farmers may not invest ininputsand C. The project would supplementthe physical technology to reap full benefits o f andwater managementimprovements with improvedwater availability andmore demonstration centersthat would disseminate equitable dlstribution. improvedagronomic practices, technologies and market information to reap the full benefit of physical andmanagement improvements. D.Theremay bedelaysinprocuring D.ProcurementofM&Econsultantshasbeen M&Econsultantsandimplementing initiatedearly. Supervision missions will agencies may not give due importance to emphasizeM&E. M&E. E.There may be delays inprocuring E. Procurementofimplementation assistance implementation assistanceconsultants and consultantshas been initiated early, and the staff performance may be weak. project provides for training of staff to build capacity. From Componentsto Outputs Component A: Social Mobilization and S A. The project supported social mobilization Capacity Building. programwould mitigate against this risk. Farmersmay not be interestedin Indications from the field are that farmers are establishing WCAs andFOs. Itmay take keen to form WCAs and FOs.Already some longer to form effective FOs and transfer 190FOshave beenestablishedinSindh. A well o f irrigation managementmay be slower designedcommunity mobilization andsupport thanexpected. program wouldbe implemented. Despite these mitigationmeasures, the riskremains that the reformprocesswould slow down ifexisting champions o f reform are somehow sidelined. Component B: Improvement o fIrrigation M Facilities: Component B (i) Tertiary Level B (i) sharingarrangementsare basedon ar Cost Improvements: The capital cost sharing analysis o f capacity and willingness to pay requirementmay discouragepoorer carried out as part o f an ISEA. A uniformcost farmers from participating and poorer sharingpolicyhasbeenintroduced inthe areas may not benefit; there may be delays province to address issues o f disparity inthis inposting, andmaintaining continuityof, respectamongst various programs. The cost key staff. sharingarrangementswill bereviewed periodically andadjustments will be made as necessary. Timelyposting and continuity o f staff would be ensuredthrough intervention of the PSC. ComponentB (ii) Improvement o f B (ii) willingness offarmers to participate ._.- - --The __ _7 - - _ - - - . -I 1- . - - - 33 - distributary canals: Farmers may be inor take over the managementofirrigation unwillingto participate inthe managemenl systems has been demonstrated under the NDP o fthe system at the distributary-level, or project. Through Component A, WCAs and not take interest inplanning and FOswould acquire capacity for O&M, dispute implementation ofproject works. resolution, financial management, environmental awareness andmitigation. Experience from other projects shows that once farmers see the benefits o f physical andservice quality improvement they willingly contribute to costs. ExistingFOsinthe Nara Canal AWB have already started limitedmaintenance works on their distributaries andminors. Component B(iii) Improvement o f branch canals (systems supplying water to FOs). B (iii) SIDNAWBs have adequate in-house AWBs may not give importance to expertise to prepare feasible canal rehabilitation improving water management andmay programs. Technical assistance has been lack capacity to plan and implement provided to ensure quality assurance. AWBs technically and economically viable would work closely with the FOs to design interventions. schemes for rehabilitationo f branch canals. Component C: Productivity Enhancement. M C. This programhas been designed with FOsNCAs may not be interested in WCAs, andFOs as the mainvehicles for participating inthis component because of information dissemination anddemonstrations. poor performance o f the extension Technical assistance has been includedfor department. training, and managing information kiosks. Component D:Monitoring and M D. This component would bedesigned and Evaluation. There are capacity limitations implemented with the assistance o f M&E inthe implementing agenciesfor designing Consultants andimplementing aneffective M&E program, including M I S and a GIS database. Component E: Project Management S E. The level of TA requirementshave been Support. GOP and GOSindh are restricted to critical requirements only. The generally reluctant to use technical process o f procurement o f Project assistance. There may be delays in ImplementationConsultants has been started procurement o f services of Project early. Implementation Consultants. Overall Risk Rating Risk Rating - H I (High Risk), S (Substantial Ris , M (Modest Risk), N(Negligib1e or Low Risk) 3. Possible ControversialAspects: None - 34 - G. Main Loan Conditions 1. Effectiveness Condition Standardconditions only 2. Other [classify accordingto covenant types used in the Legal Agreements.] A. Overall: GOSindh shall implementthe project inaccordancewith the Project Implementation Plan (PIP). B Covenants Related to Project Management B.1 GOSindh shall ensure that the existingproject steering committee (PSC) andthe project coordination committee (PCC), shall be maintained throughout the project implementation period, with terms o f reference and composition satisfactory to the Association. B.2 GOSindh shall ensure that the DGAEWM, Director OFWM, FieldTeams, District Teams, SIDA andAWBs shall maintainthe staffingandresponsibilities agreedwiththe Association through out Project Implementation. B.3 GOSindh shall: (a) not later than March 31 ineachyear finish to the Association, for its review and agreement a draft annual plano f Project activities, including a work program andproposedbudget, for the next following Fiscal Year; and(b) not later than May 31next following, finalize suchplanbasedon the draft as so agreedby the Association. B.4 GOSindh shall ensure that the DGAEWMand SIDMAWBs shalljointly prepare a detailed work program for capacity buildingand training and submit it for the Association's review by July 31,2004. B.5 GOSindh shall submit a monitoring andevaluation program for the project for the Association's review by September30,2004. B.6 GOSindhshall: (a) maintainor cause to be maintainedpolicies andproceduresadequate to enablemonitoring and evaluation on an ongoing basis, inaccordancewith a programagreedwith the Association not later than September 30,2004 andindicators satisfactory to the Association, the carrying out o f the Project and the achievement of the objectivesthereof; (b) prepare or cause to be prepared, under terms o f reference satisfactory to the Association, andfurnishto the Association: (i) beginningSeptember30,2004, quarterly and semi-annual reports; and (ii)June30,2006,amid-termreport,allintegratingtheresultsofthemonitoringandevaluation by activities performed pursuant to sub-paragraphsB.5 and B.6 (a) above, on the progress achieved inthe carrying out o f the Project during the period preceding the date of saidreports andsetting out the measures recommendedto ensure the efficient carrying out o f the Project andthe achievemento fthe objectives thereof duringthe period following such date; and (c) reviewwith the Association, by September30, 2006, or suchlater date as the Association shall request, the mid-termreport referred to insub-paragraphB. 6 (b) (ii) above, and, thereafter, take all - 35 - measuresrequired to ensure the efficient completion o fthe Project andthe achievemento f the objectives thereof, basedon the conclusionsandrecommendationso fthe saidreports and the Association's views on the matter. B.7 GOSindh shall ensure that, not later than September 30,2004: (a) procurement documentation and record keeping systems, all satisfactory to the Association, shall be developedand adopted by all project implementingagencies(DGAEWM, DGAER, Director OFWM, SIDA, AWBs and FOs); and(b) key procurement staffo f the DGAEWM, Directorate o f OFWM, SIDA andAWBs shall be identified, trained inthe Association's procurementprocedures,anddesignatedas focal points for procurement for the duration o f the project. C. CovenantsRelatedto CivilWorks C. 1 GOSindh shall ensure that: (i) watercourseand distributary canal improvement works shall be carried out inaccordancewith design criteria and specifications satisfactory to the Association; and (ii) the distributary/minor canals included inthe project shall be improvedto achieve sufficient capacity to deliver their respectivefull dischargeentitlement determinedon the basis of their share o f the diversions at the head o f the main canal command system over the previous 10years. (2.2 GOSindh shall ensure that: (a) no assistance will be made available to farmers for a scheme for the renovationo f a watercourse or construction o f a water storage tank and associatedworks underthe Project, unless and untilthe farmers seeking such assistancehave: (i) andregistereda fully functioning WCA at the level of such formed watercourse or water storage tank inaccordancewith the provisions o f the SWMO 2002 iflocated ina canal command or any other relevant law iflocatedina bavani (rainfed) area; (ii) established that such WCA has the capacity to carry out the scheme; and (iii) acting through such WCA: (aa) furmshed evidence to DGAEWMthat the scheme satisfies all the eligibility and prioritization criteria satisfactory to the Association set out inthe PIP and applicable to such scheme, and (bb) reachedagreement with DGAEWM,inform and substance satisfactory to the Association for: (A) carrying out the scheme; (B) sharing the costs of the scheme inaccordancewith the provisions of sub-paragraphC.3 (a) below; and (C) undertakingthe O&M ofthe facilities onwhich the scheme is to be carried out; (b) no assistancewill be madeavailable to farmers for a scheme for the improvement o f a distributary/minor canal under the Project, unless and untilthe farmers seeking such assistancehave: (i) formedand registered an FO at the level o f such distributary/minor canal inaccordancewith the SWMO 2002; (ii)establishedthat such FO has the capacity to participate inthe carrying out o fthe scheme; (iii) acting through such FO, (aa) hishedevidenceto SIDNAWB that the scheme satisfies all the eligibility and prioritization criteria satisfactory to the Association set out inthe PIP and applicable to such scheme, (bb)reachedagreementwith SIDNAWB, inform and substance satisfactory to the Association, for carrying out the scheme, and(cc) entered into an IDMTAwith SIDNAWB, inform and substance satisfactory to the Association, for the O&M o f the facilities on which the scheme is to be carried out; and (c) no precision landleveling(PLL) equipmentwill be made available to an FO, unless anduntilthe FOhas: (i)i s h e devidenceto DGAEWMthat the FO satisfies all the eligibility criteria satisfactory to h the Association set out inthe PIP and applicable to such FO; and (ii) reachedagreement with DGAEWM, inform andsubstance satisfactory to the Association, for: (aa) initially sharing the costs ofthe equipment inaccordancewith the provisions ofsub-paragraphC. 3 (c) below; (bb) gradually acquiring full ownership ofthe equipment uponthe achievemento fphysical targets specified inthe agreement; and (cc) - 36 - undertakingthe O&M o fthe equipment. C.3 GOSindh shall ensure that: (a) inrespectofany scheme for renovationofwatercoursesor construction ofwater storage tanks and associatedwatercourses carried out underthe Project, the farmers for whom such scheme i s carried out will be required to contribute, up-front and through the relevant WCA, all skilled andunskilled labor, whether incashor inkind, and 10%of the cost of materials required therefor; (b) inrespectofany scheme for PLLcarried out underthe Project, the farmers for whom such scheme is carried out will be requiredto meet 100%of the cost thereof; and (c) inrespectofany PLLequipmentprocuredfor FOsunderthe Project, the FOsfor whom such equipment is procured will be required to pay 50% of the cost thereof prior to takingpossession. C.4 GOSindh shall ensure that eachWCA participating inthe canyingout o f any scheme for the renovation o f watercoursesor construction of water storage tanks underthe Project, and each FO participating inthe carrying out o f any scheme for the improvement o f &stributary/minor canals underthe Project, will be requiredto maintainlabor musterrolls satisfactory to the Association to demonstratethat it has made due payments for all skilled andunskilledlabor employed by it for such scheme. C.5 GOSindh shall ensure that representativeso f any FOs participating inthe carrying out o f any Project scheme, and inthe O&M o f the facilities on which such works are to be carriedout, shall be invited to participate inthe proceduresfor planning, design, invitingand evaluating bids, andawarding contracts for the procurement o f civil works and materials for suchProject schemes. C.6 GOSindhshall conduct surveys every six months, to determine the prevailingmarket prices of construction materials used inthe renovation o fwatercourses and construction o f water storagetanks under the Project and shall share the findings o f such surveys with the Association. C.7 GOSindh shall ensurethat: (a) no distributaryhinor canals, water storage tank schemes, minor irrigation schemes, demonstration centers, offices for WCAsFOs, canal service roads and any other activities involving landacquisition will be included inthe Project without prior approval of the Association; and (b) such landacquisition shall be carried out on a voluntary basis inaccordancewith such principles andproceduresas shall have beenagreedwith the Association. D. Covenants Relatedto EnvironmentalManagementandPest Management D.1 GOSindh shall implement,ina manner satisfactory to the Association, the environmental mitigation, monitoring and other measures set forth inthe Environmental Management Guidelinesdated November 25,2003 (included inthe PIP) inaccordancewith the objectives, policies, procedures, time scheduleandother provisions set forth therein, and shall not take or permit to be taken any action which would prevent or interfere with such implementation. D.2 GOSindh shall implement, ina manner satisfactory to the Association, the measuresto promote andsupport safe, effective, and environmentally soundpest managementset forth inthe PMP (included in the PIP) inaccordancewith the objectives, policies, procedures, time scheduleandother provisions set forth therein, and shall not take or permit to be taken any action which would prevent or interfere with such implementation. - 37 - E. Covenants Related to FinancialManagement and Cost Sharing Policy E.1 GOSindh shall ensure that a financial management system, managedby suitable staffwith qualifications andexperiencesatisfactory to the Association, will be maintainedfor DGAEWMand SIDA for the duration of the Project. E.2 GOSindh shall ensure, through the Project Coordinator, that DGAFWMand SIDA provide, under the coordination of the Chief Financial Coordinator of the project, to the Association, not later than 31 December, each year (excepting31 December2004), auditedaccounts o feacho fthe two project implementingagencies as well as auditedopinion onthe consolidatedauditedaccounts ofthe project for the preceding fiscal year (or for such other periodagreedby the Association), along with an action planto address any audit issues. E.3 GOSindh shalljointly review with the Association, its capital cost sharingpolicy for watercourse improvement annually, H. Readinessfor Implementation 1. a) The engineeringdesigndocuments for the first year's activities are complete andready for the start of project implementation. 0 1.b)Notapplicable. 2. The procurementdocuments for the first year's activities are complete andready for the start of project implementation. 3. The Project Implementation Planhas beenappraisedandfound to be realistic andof satisfactory quality. c] 4. The following itemsare lacking andare discussedunderloan conditions (Section G): The General ProcurementNotice (GPN) has been issued. The borrower has issued bid notices and RFPs for the first year implementation program. 1. Compliance with Bank Policies 1. This project complieswithall applicable Bankpolicies. 02.Thefollowing exceptionstoBankpoliciesarerecommendedforapproval. Theprojectcomplieswith all other applicable Bankpolicies. Team Leader Sector Director &&try Director - 38 - Annex I:Project Design Summary PAKISTAN: Sindh On-Farm Water Management Project Data Collection Strategy 1 Sector-related Critical Assumptions CAS Goal: Sector Indicators: ~~ ~ Sector1country reports: from Goal to Bank Missic Efficient and socially & 0 Improved water 0 Agricultural statistics/ 0 The Government sustai environmentally sustainable management census Reports its comprehensive refor management o f water Improved productivity in 0 M&E Socioeconomic - program aimed at povei resources for irrigated irrigated agriculture. impact reports reduction and inclusive agriculture to increase farm 0 Increasedfarm incomes 0 Poverty assessment development including incomes, and reduce rural 0 Reducedrural poverty reports (PRSPs) emphasis on improved 0 Integratedhousehold water management and surveys agricultural productivit 0 relatively stable politic: and macro-economic environment. objective: Project Development htcome IImpact 'roject reports: from Objective to Goal) ndicators: 'Farmers inthe project area I. Improvedoperation, 0 Baseline and biannual 0 Supporting environmer better manage water and naintenance and water impact monitoring i s in place such as increase agricultural listribution in 100 surveys, SPN reports, appropriate agricultura MTR, ICR, and ex-post trade and price policies ~ productivity, supported by listributary canals managed improved irrigation )yFOs, as measuredby: impact evaluation surveys marketing and storage infrastructure and service and reports facilities, and roads, delivery. Stakeholders feedback which are essential for 0 improved reliability, 0 andequity o firrigation workshops. increasedproductionto translate into increased water distribution, incomes. reflected by: (i) 70% reduction innumber o f missed tums for Irrigation, as compared to baseline; (ii) ontail-end farmers watercourses receive due water share 80% of the time) :. In4,000 improved vatercourses water onveyance efficiency mproved by 20% compared 3 baseline values itensity increased by lo%, . Irrigatedcropping ompared to baseline values . Yields increased by: - 39 - 1.5 % for wheat, 8.5 % for Cotton, and 23% for sugarcane, compared to baseline values. Outputfrom each Output Indicators: Project reports: (from Outputs to Objective) Component: Component(A): Social (A) At the end of project: (A) Periodic Institutional A. (i) WCAs, and FOs not Mobilizationand Capacity WCAs and FOs established in monitoring and evaluation dominated by rural elite BuildingProgram:WCAs accordancewith SWMO reports; Self-assessment (ii)DGAEWM,AWBsfoster and FOs established inproject 2002, are active, conducting surveys by WCAs, FOs; and support FOs area, IDMT agreements business democratically, survey o f FO members and signed, and WCAs', FOs' providingresponsive, stakeholders feed back (iii) GOSindh does not waiver capacity createdto operate sustainable services to workshops. inthe implementationof and maintain watercourses :ommunities as measured by institutional reforms and distributary canals and the following: collect abiana. 0 80% FOs conduct elections andmake decisions ina transparent manner 0 80% FOs have O&M, anc business plans and meeting required O&M standards; 0 FOs increase abiana collection by 10%each year 0 80% WCAs and 70% FOs have participated in watercourse and distributary improvement programs; and 0 20% WCAs, & FOshave participated in PLL programs 60% reduction inwater disputes among inter- and intra-watercourse farmers Component (B) : B): (B)Periodic project (B) Improvement ofIrrigation 0 Improvedbranch and implementation, physical Drought and poor water Facilities: distributary canals have progress monitoring, and availability inthe irrigation 4,000 Watercourses, adequate capacity to carry socioeconomic impact system does not discourage 100 distributary and full design discharge. monitoring and evaluation farmers from investing in 25 branch canals improved 0 80% decrease in canal reports. improvements. and operating more efficiently breaches 15%-20% increase in water supply at farm gate as compared to baseline__ -1_-1 -I ----__-_I - 40 - . . ..., "".l..-l..ltiI 0 20% increase in watercourse delivery efficiency, as comparedto baseline ; EMP implemented diligently Eomponent (C): :C): :C) Periodic project (C): ProductivityEnhancement: 30% o f farms on mplementation, physical 0 Timely & equitable 4dequate knowledge and improvedwatercourses irogress, and socioeconomic distribution of water and ;kills for improved on-farm demonstrate knowledge nonitoring and evaluation better access to water management, improved o f improved cultural `eports. information on markets xltural, agronomic and pest practices encourage farmers to nanagement practices, and 0 10%farms carryout PLL invest ininputs and mprovedaccess to PLL adopt improvedpractices echnology provided and technologies Market prices are an incentive to produce Zomponent (I)): 1. (D): Monitoringand Evaluation D).Timely 0 feed back on 0 Project implementation 0 Timely appointment and Programimplemented project impact provided monitoring reports. good performance o f and taken into account in 0 Management decisions M&EConsultants' improving design and and actions taken on the DGAEWM, SIDA, implementation basis o f M&Ereports AWBs, andFOs give due 0 Project incentive 0 Bank supervision reports, importance to M&E framework for promoting participation o f women and sharecroppers tested and proposals for improvement made 0 lessons leamed for future operations Zomponent (E): E): ?. Project implementation (E) Timely appointment and 'roject Management 0 Project implemented nonitoring reports. good performance o f staff and Support provided efficiently and intimely implementation consultants. manner Quality o f works and services completed is satisfactory -41 - Data Collection Strategy- Critical Assumptions - Project Components I nputs: (budgetfor each Droject reports: :fromComponentsto Sub-components: :omponent) 3utputs) (A) Social Mobilization and JS%4.84 million. 1.Projectimplementation 4. Farmers interestedto form Capacity Building: Social nonitoring, project cost and ?Osto participate in: (a) the mobilization, capacity inancing, and Bank nanagement of the system at building & training for about lisbursementreports. :he distributary level; and (b) 100 FOs and 4,000 WCAs Jlanning and implementation Ifproject works. (B) Improvement of irrigation JS$ 69.31 million. 3, Project implementation B. Facilities: nonitoring, Bank a Farmers willing to share lisbursementreports. capital cost Q Watercourseand On-Fam JS$ 55.87 million a Timely availability of Improvement Program: counter-part funds Improvement o f about 4,000 a Timely postingand watercourses, construction o f continuity o f key staff about 200 storage tanks, and precision land levelling on about 40,000 hectares of farm land. (ii) Distributary Level JS$ 9.38 million. 'roject implementation -do- Improvement Program: nonitoring, and Bank Improvement o f about 100 lisbursement reports. distributaries. (iii) Branch Canal JS$ 4.06 million. 'roject implementation AWBs seek to improve overall Improvement Program: nonitoring, project cost and system management and Rehabilitationlimprovement inancing, and Bank reliability of water supplies o f about 25 branch canals. lisbursement reports. andhave required capacity for planning and implementation. (C)Productivity Enhancemeni JS%5.42 million. 2. Project implementation C. FOs willing to participate Program: About 100 nonitoring, project cost and indemonstrations, extension demonstration centers, inancing, and Bank activities, running training o fFOsIWCAs, lisbursement reports. information kiosks, establishment o f 3 equipment rental systems information kiosks (D) Monitoring and JS$ 1.73 million. 3. Project implementation D.GOSindhandproject Evaluation: Baseline surveys, nonitoring, project cost and Implementing agencies accord comprehensive information inancing, and Bank due importance to M&Eand system and GIS iisbursement reports. impact assessments andperiodic assessments. (E) Project Management JS%3.47 million. Z . Project implementation E. Project implementation Support:for project nonitoring, project cost and consultants and staff are implementationand inancing, and Bank appointed intime management, quality iisbursement reports. assurance, procurement, information system, productivity enhancement and training. - 4 2 - Annex 2: Detailed Project Description PAKISTAN:Sindh On-Farm Water Management Project By Component: Project Component 1 US$4.84 million - Social Mobilizationand CapacityBuilding 2.01 NeedandJustification.The Sin& Water Management Ordinance (SWMO) 2002 assigns crucial hctions inirrigation managementat the distributary canal level to FOs. It empowersthem to receive water from AWBs, distributewater to watercoursesoff-taking from the dstributary and collect abiana (water charges) from individual water users. A formal Irrigation Drainage Management Transfer (IDMT) Agreement is executedbetween the AWBs andthe FOs that defines the roles andobligations o fbothparties and the procedures for their respectiveparticipation inthe system's management. The FOs retain 40% o f the abiana proceedsto meet O&M cost at the distributary level and pass the balanceto AWB and SIDA for the O&M o f the upper tiers of the system. Social organization and capacity building are thus key to developingsustainableFOs so that they canperform thesefunctions effectively. While a limited initiative for training andcapacity buildingo f existingFOshas beentaken by SIDA through its Social Development Unit,a more structuredandcomprehensiveprogram with a wider coverage is needed. 2.02 Targets and SWMORequirements.The project provides resourcesfor social mobilizationfor establishingnew FOsand for buildingcapacity of existingas well as new Fos. About 100 FOs andtheir constituent WCAs would be establishedinaccordancewith the SWMO 2002. The SWMO 2002 defines FOs as corporate bodies that are to be formally registered with the Regulatory Authority. It, inter alia, makes the following key stipulations for FOs: 0 At least 213 (two thirds) ofthe command area inthejurisdiction ofFOs mustbe coveredby WCAs 0 The Generalbody ofFOs musthave membersfrom at least 21 WCAs or Drainage Beneficiary Groups (DBGs) 0 O fthe total o f 6 membersof the FOs' Board o fManagement, at least 3 members shall be representativeso f WCAs or drainagebeneficiary groups (DBGs) from the tailreaches of the distributary or minor or shallbe smallfarmers withholding less than 16acres. The SWMO 2002 defines WCAs as follows: "Inevery localarea, a group ofnon-elected farmers may, for energizing the farmer community and improving service delivery, set up a WCA andundertakevoluntary and self help initiatives". At least 213 (two thirds) o f the landowners and leaseholders on a watercourse mustcome together to form aWCA. The WCAs are registeredwiththe FOsandtheir functions include, inter alia, operating, maintaining, improving andrehabilitatingwatercourses and ancillary structures. In areas where there are no FOs, the WCAs are to be registered as FOs. 2.03 Responsibilityfor, andApproach to, Social Mobilization. The current status o f social mobilization is that 193 FOs have beenregistered, o f which 162 are inNara AWB, 12 inLeft Bank AWB, 10 inGhotki AWB, and9 outsidethe notifiedAWBs. Underthe NDP, the Left Bank AWB has been given a contract for the formation o f 105 FOs. For Ghotki AWB, a similar arrangement with DGAEWMto form 70 FOs is under consideration. As the project aims to establish another 100FOs, the social mobilization efforts would needto focus on the two newlynotified AWBs (Began Sindh Feeder Canal andWestern Canal). The project would support: (i) formation o f WCAs andFOs; and(ii) subsequent the the strengtheningof these andexistinginstitutions. The DGAEWMthrough the Director On-Farm Water -43- Management, District andFieldTeams would be responsiblefor establishing new FOs, while the Social Development Cell (SDC) in SIDA will be responsiblefor capacitybuildingandtraining o f existingand new FOs. The DGAEWM, through the Directorate ofOn-Farm Water Management,will be responsible for the project's social mobilizationprogram-- 16District Teams and 50 FieldTeams with multidisciplinary staff are being establishedto carry out social mobilization; provide technical assistance and engineering support to WCAs for watercourse improvement; andcollect baselinedata. These teams include staff who have the experience o f setting up over 140 FOs and over 2,000 WCAs inthe NaraAWB. The District Teams headedby the Deputy Director will supervisethe FieldTeams ineachdistrict. Each District Teamwill have social mobilization skills. The FieldTeams will include the following key staff and skills: Assistant Director Water Management Officers (Engineering) Water Management Officer (Agriculture) Accounts Officer Sub-engineers RodMan (Survey Assistant) Once formed, the buildingof capacity o f FOs and WCAs to perform their functions effectively, efficiently andsustainably will becritical. The Project would support SDC to develop this capacity withm these institutions through a continuous process of institutional assessmentand evaluation followedby strengthening, which involves: (i) (ii) training; institutional strengthening, including preparation o fbusiness plans; and(iii) coordination, networking and linkages among the various players inthe sectors. Specific trainings would include amongstothers: (i) organization andmanagement; (ii) financial management (to be providedby the Financial Management Support teams); (iii) assessment andcollection of ubiuna;( iv) communications and conflict resolution; (v) water measurementboth for irrigation and drainage management; (vi) operation andmaintenance; and(vii) awareness raisingand demandpromotion about the project. It is expectedthat by the end o f the project, SDC would have built the capacity o f at least 100FOs (existingandnew) to the extent that they are managing their organizations effectively, and operating andmaintainingtheir water distribution systems inan equitable and sustainablemanner. 2.04 Informationdisseminationanddemandpromotion. Informationdissemination anddemand promotion is critical to ensure that the project reaches out to all potentialbeneficiaries, by conveying to them,project details andscope, its benefits, andonhow they canparticipate andaccess resources. The project would support the Directorate of Agncultural Informationandthe Media Cell inSIDA ina range of activities inreaching out to farmers. Broadly, the Directorate would be responsible for the more general information dissemination and awarenessthroughout the province whereasthe Media Cell would focus on demandpromotioninthe AWBs and FOs. SDC will also contribute to awareness raising anddemand promotion about the project as a key element of its capacity buildingactivities bothduring the pre- and post-IDMT interactions with FOs. Specific activities fundedby the project would include, for the Directorate: (i) information dissemination through messages on the radio andTV; (ii) printedmessagesinthe form o fbrochures, posters andregular features inthe monthly Sin& Zurut magazineproducedby the Directorate; (iii) mobile cinema vans carrying messages to villages; and (iv) equipment to develop materials. For the Media Cell the project would support: (i) the establishmento f 3 pilot informationkiosks; (ii) awareness workshops and field based programs; and (iii) special columns innewspapers. - 44 - The project description and the requirements for participation (e.g. responsibility for O&M, abiana collection, equitable water management, legal status and governance, and cost sharing requirements,) will be disseminated. A demand driven approach would be followed to help buildownership andease social mobilization downstream inthe process. Informationdissemination and subsequently selection o f subprojects will start inthe areas identifiedas beingthe poorest and inmost need o f irrigation improvementfdevelopment. Applications from potential beneficiary communities will be basedon a predefined format which requires specific information(e.g., landuse, irrigation coverage, land holding, and land tenure, etc.). The District and Field Teams will be responsible for information dissemination and providing support to groups o f farmers to submit applications expressing interest in forming WCAs and FOs (see ImplementationFramework Annex 2.1) and improving watercourses and distributary canals. ExistingFOsandWCAs would be eligible to apply for participation inproject activities without being obligedto seek a fresh registration. Inaddition to electronic and printmedia, a dissemination and motivation campaign will also be undertaken through direct contacts with local government offices (Nazims, DCOs), the Farmer Organization Council, Abadgar Board, Chamber o f Agriculture, FOs, WCAs, and others. 2.05 Applications received from farmers for establishing WCAs/FOs, or for participationinthe project, would be screened and prioritized. Once an application from farmers o f a watercourse or distributary improvement has been selected, baseline surveys and social mobilization would be initiated. Baseline surveys would cover physical features, agricultural aspects, condition o f the irrigation and drainage system, surface and groundwater supplies, and socioeconomic factors. Baseline date will be entered incomputer database and a digitized map would be prepared (including georeferencing ina global information system). This data will be used as the baseline against which project performance andachievement o foutcomes will be measured. The types ofdata collected for the baseline - and subsequently during monitoring should therefore lendthemselves to output andoutcome monitoring. 2.06 After the baseline has been prepared, the social mobilizers (SMs) o f the Field Teams would prepare a suitable plan andinitiate dalogue with the farmers for developing a WCA and/or FOs. The SMs would make an initial visit followed by several return visits. As a first step WCAs would be established at the watercourse level on at least 2/3rd o f the watercourses on each distributary. The WCAs/FOs would be formally registeredwith the Regulatory Authority (currently SIDA performs this function). SIDA would be obliged to process the application for registration o f WCAs/FOs within 10 working days. IfSIDA fails to complete the registration process within this period, the WClVFOs would be deemed to have been registeredfor purposes o f accessing project resources. WCAs established outside the canal commanded areas (i.e. inrainfed areas) would be registered under any other relevant law. Inaccordance with the SWMO 2002, the chairpersons o f the WCA would constitute the General Body o f FOswho would elect the FO Management Committee. Duringthe social mobilization process the field teams will impart initial training to WCA and FOs on various aspects o ftheir responsibilities under the SWMO (see below). Keeping inview considerations o f financial viability the minimumcommand area under thejurisdiction o f FOs would be such that they are able to generate sufficient funds from abiana to meet O&M requirements. At the same time, very large distributaries may be difficult for FOsto manage. Very large distributaries may be divided in more than one segment, each managedby one FO. Onthe other hand, where the distributaries are small one FO may havejurisdiction on more thanone distributary or minors. Ingeneral the FOs would manage command areas of about 4,500 ha. Based on past experience it is estimated that each S M team would develop at least one FOs (and its constituent WCAs) inabout 3 months. As part o f the FO formation process, the field teams would help the WCAs andFOs inthe following: (a) develop a register o f water users; (b) working with AWB, determine a schedule o f water rights for the FOs, andbased on these rights, - 45 - define anddevelop a register o fwater rightsofeach WCA group within the FO, andfinally each member; (c) develop a water distribution procedureinthe FO area; (d) determine the hydraulic condition ofthe systemwithin the commandof FOwith the help of a survey team and develop an operation andmaintenance (O&M) program, anddetermine the O&M cost of eachunitwithinthe FOas well as eachmember's share; (e) develop the procedurefor O&M cost recovery, operation o fbank accounts, andan accounting system for the FO and its constituent WCAs; (f) signing ofthe IDMTA; (g) Participationinproject activities. The Social MobilizatiodGender Specialist of the Project Implementation (PIA) Consultants will impart training to social mobilization staff o f DGAEWM, including steps to be taken for promoting involvement of women. He/She would assist inevolvingappropriateprogram interventions for women basedon a needs assessment. Areas ofparticular focus for women include: involving women indecision makingwhile framingthe design ofscheme interms oflocation ofwashing points; awareness raising for issuesrelatedto water use, waste water disposal, generalhygiene, storageof pesticide/insecticide, establishing nurseries and greenhouses, etc. 2.07 CapacityBuildingandTrainingwill beprovidedto project staffas well as WCAs andFOs. An indicative list o fkey areas inwhich training and capacity buildingwouldbe implemented for project staff, andWCAs/FOs is givenbelow. The DGAEWMand SIDNAWBs supportedbythe PIA andM&E consultants shall iointly preparea detailed promam for capacity buildingandtraining, including - strengthening o f one training institute and submit it for the Association's review by July 31.2004. - 46 - Indicative List of Key Areas of Project Staff Training Area of Training Target Group Duration Responsibility (Timing) 1 Operationalization o f Key Staff o f DGAEWM, 1week DGAEWM, MD SIDA , Project Implementation Directorate o f OFWM, (One month prior Director General Framework, including Area Teams, FieldTeams, to project launch) Agriculture Extension implementation o fthe District WMO, SIDA, environmental AWBs, Farmer guidelines, check list Organization Council and monitoring and reporting formats 2. Refresher course insocia Existing District and Field 1week DGAEWM, Sakrand mobilization, watercourst Teams o f DGAEWM, (Immediately upon and other OFWM improvement (survey and posting o f staff) Training Institutes design), land leveling WL), 4 months FullTraining inabove New Water Management (Pre-posting areas Officers and other staff training) 3. Output Based Agreement Area and FieldTeams, 2 days Director OFWM, PIA for Watercourse Accounts staff o f (prior to project Consultants Improvements and DGAEWM, Director launch) Agreement for Land OFWM, and Area and leveling Fieldteams 4. Social Mobilization, Social Mobilizers and key 1week SIDA's SDC with including tenant staff o f Area and Field (One monthprior tc assistance of PIA participation and Gender Teams project launch) consultants in inclusion collaboration with Rural Support Programs and Service Providing NGOs 5 Baseline Surveys Field Team Staff 4 days M&Econsultants (one month prior to commencement o f surveys) - 47 - idicative List of K Area of Training Target Groups Duration (Timing) Responsibility 1. Book Keeping and WCA and FOs 2 days Financial Management Financial accountants (Upon signing o f OBA) Support Teams, SDC, Management Director OFWM, and District & Field Teams 2. Output Based WCA and FO 2 days SDC, District and Field Tear Agreement (OBA) for Chairpersons (During Social WMO (social mobilization) Watercourse mobilization and survey Improvements, and and design o f Agreement for Land watercourses) leveling Operation o f Laser Laser operators 1week Sakrand On Farm Training Equipment for land designated by FOs [Before placing order for Institute leveling receivingthe laser equipment) equipment 3. Basic Training in WCA, FOs 2 days Director OFWM, District and Watercourse and technical (DuringSocial Field Team, WMOs for distributary canal personnel, mobilization and survey watercourses, and XENs o f discharge measurement Management and design o f AWBs and PIA consultants f c Committee watercourses and Joint distributary canals walk-throughs) 4. O&M o fWatercourses WCA 1day SDC, FieldTeam WMOs Management (During Watercourse Committee improvement) 5. O&M o f distributaries; FOs technical 2 days ISDC, XENs o f AWBs and PI, and preparation o f personnel and improvement schemes Management iistributary improvement by walk-through surveys Committee 6. Consensus buildingand FOs, WCAs, 2 days SDC, OFWM FieldTeam and dispute resolution Management Committee Mobilization process) ISIDA, AWB for FOs 7. Crop Assessment FOs and 2 days ISDC and AWB staff Abiana collection Chairpersons o f (Upon signing o f WCAs IDMTA) 8. Understanding the FOs and 2 days SDC, and SIDA legal staff SWMO and IDMT Chairpersons o f (During Social Agreement WCAs Mobilization) 9. Preparation o f Business FOs Management 2 days SDC, SIDA andAWB staff Plans Zommittee and (Upon signing o f 4ccounts Persons IDMTA) 10. Women and tenant #omen, tenants 1day SDC, OFWMDistrict Teams inclusion indshare (During Social and gender specialist o f PIA xoppers Mobilization) consultants 11. Awareness o fIPM, COSand WCA 2 days DGAERstaff working on IPM IPSNM, Pesticide (periodically) with assistance of National Residue monitoring I P M program staff and Director Information Agriculture. SIDA Media Cell - 48 - Project Component 2 US$69.31 million - HighPayoffImprovementofIrrigationFacilities: (i) WatercourseImprovement-US$55.87million, (ii) DistributaryandMinor CanalsImprovement US$9.38million - (iii) BranchCanals Improvement -US$4.06 million WatercourseImprovementand ConstructionofWater Storage Tanks RationaleandJustification 2.08 Watercourse Improvement.A major portionofirrigationwater losses occur inthe tertiary system. Monitoring data documentedinICRs and evaluation reports indicate that about 25% to 30% of water received at the headof unimproved watercourseis lost through seepage, operational losses (spillage, leakage from field turnouts and evaporation) before reaching the farmer fields. Thin, distorted and silt-loaded watercourse banks; zigzag sections; trees, shrubs andvegetation growth; rodent holes; distorted sections due to animal crossings, and improper maintenance, are some of the maincauses o f the operational losses. Improvemento fwatercourses, including earthenimprovement and lining,results ina greatly improved conveyanceefficiency. It increases the amount o f irrigation water delivered to the farms, reduces the labor requiredfor irrigating fields, andreducesmaintenancerequirements. Provisiono f community structures(washing places, cattle drinkingpoints, animal baths) and liningof watercourses reachespassing through villages, give additional public healthbenefits. Keeping these benefits inview, the project has allocated the highest resources for t h s sub-component. The highestbenefits from watercourse improvements accrue inthose areas where: the groundwater is saline; farmers receive a reliable delivery of irrigation water at the heado f the watercourse; physical improvements are accompaniedby improvedwater management and scheduling and equitable distribution inthedistributarycanals; theareadoesnothaveseverewater loggingandsalinityhodicity problems; anda relatively highnumber o f farmers benefit. Given these efficiency considerations, the project focuses on AWBs, where institutional reforms are beingimplemented. Dueto various considerations, however, GOSindhdesiresto not exclude other areas from receiving watercourse improvements. Ithas beenagreedthat a limitednumberof watercourse improvements (not more than 1,400) would be carried out inareas outside AWBs subject to the following principles and criteria: (i) least 80% of these watercourseswould be insaline groundwater areas; (ii) should be at there availability o fwater at the heado fthe watercourse, farmers pay abiana and are able to produce receipts as evidence; (iii) the command area is not abandoneddue to severe drainage problems; (iv) the watercourse serves at least 7 landowners or leaseholders anda WCA or FO i s establishedand formally registered underthe SWMO 2002; (v) priority wouldbe givento canal commandswhere AWBs are to be established next (i.e. Begari Sindh Feeder Canal andWestern Canal ); (vi) watercourses that meet these eligibility criteria will be screened andprioritized usingthe criteria described inAnnex 2.1 o f this PAD that also apply to watercourse improvements within the existing AWBs. Inareas outside AWBs, watercourse improvements wouldbe carried out inclusters or adjacent watercourses on dstibutaries on which FOs are to be established. 2.09 Water Storage Tanks. Inareas outside canal commands, where rainfallis scanty anderratic, farmers rely on small capacity skimming (shallow) tubewells where the groundwater is o fusable quality. The yieldfromthese tubewells is small andvariable. Highconveyancelosses occur ifthe small tubewell - 49 - discharge is useddirectly for irrigation. Insuch situations, concrete or brick linedtanks are constructedto store about 8 to 12 hours o f the output of the tubewell. The storedwater is then supplied together with the direct discharge from tubewell to obtain sufficient dischargeinthe watercourseto attain a reasonable conveyanceefficiency. 2.10 Targets for Watercourse Improvement and Storage Tanks. There are about 42,000 watercourses inSindh o fwhich only about 7,500 watercourseshave so far been improved under past programs and projects. The project provides for improving about 4,000 watercourses, o fwhich about 2,400 will be inAWE3 areas, no more than 1,400 inother canal commands, and about 200 outside canal commands. About 200 water storagetanks each with a capacity of storing 6,400 cubic feet (40 feet x 40 feet and deptho f 4 feet) and servingfrom 5 to 10 farms, wouldbe constructed. 2.11 Technical Standards and Specifications. Watercourseimprovement works and water storage tanks will be designed andconstructed inaccordance with the national standards and practices established by the Ministryo fFood, Agriculture and Cooperatives, Government ofPakistan, inJune 1980 andits subsequent revisions documentedinvarious FieldManuals issuedin 1996. 2.12 WatercoursesinSindh vary incapacity from 2 cfs (54 liters per second (Ips)) to 4 cfs (108 Ips), command between 75 to 200 ha (average o f 187ha) o fland andserve about 15 to 40 farmers. The surkuri khul (communal part o fthe watercourse) represents about 20 percent o fthe total lengthwiththe remaining 80 percent beingfarmbranchesand fieldditches. Inaccordancewith the prevailing practice, the headreaches o f watercourseswhich have maximumflows andhydraulic head and carry water at all times, wouldbe realigned (straightened) where necessary, andlined. Inaddition, other reaches having excessive water losses because of elevation, soil conditions, chronic sedimentationproblems, hightraffic areas aroundvillages, would also be eligible for lining. The total lengtho f liningwould not exceed 15 percentof the lengthof communal watercourseinfresh groundwater (FGW) areas and30 percent insaline groundwater (SGW) areas. Researchresults documentedinvarious publications indicate that there is a diminishingreturn to liningbeyond these limits. Precast outlets lpuccu nukkus) wouldbe installed to reduce channel deterioration andwater loss, and improve water control. Culverts would be installedat major crossings, and a limitednumbero f checWdrop structures, and community structures (animal wallowshuffalo baths, laundry sites, etc.) wouldbeprovided as required. 2.13 Ingeneral,the lined sectionswould berectangular.Parabolic or trapezoidal sectionsmaybeused for larger capacity watercourses. Liningwould consist o f double-brick masonry wall (23 cm) andabrick or concrete bed (8 cm), plastered inside and on top o f the wall. Stonemasonry or three-piece precast slabs, or pre-castparabolic sections, costing about the same, could be used inconsultation with the Director OFWM. Bricks procured shall be ofgood quality (free o fflaws, cracks and powdery crust o f salts), well fired, andmeet the following minimumstandard (a) standardsize (23 cm x 11cm x 7 cm) with square comers and parallel sides; (b) absorb not more than 6 percent o f their weight after one hour soaking in water; and(c) withstand a crushing force o f 250 kgskm2. All masonry mortar shall have a cement-sand mixture o f 1:4 (one part cement to four parts o f sand). Concrete for liningand structure shall have a mixture o f 1:2:4 (1 part cement, two parts sandand four parts aggregate). The liningmaterial wouldbe selectedto suit local conditions. The portion ofwatercourse that is not to be lined, wouldbe rebuilt with clean compact soil to obtainan efficient line andgrade. Incases where the unlined sectionshas widened due to erosion andor channel meandering "brick spurs" will be constructed on both sides of the watercourse at about 200 meter intervals to define the trapezoidal section o fthe unlinedchannel. The bed o fthe watercourse inthis section would remain unlined. Farmersmay place killu bushing (wooden stakes andbushes) inbetween the spurs to - 50 - induce silt deposit and berm formation. 2.14 ImplementationArrangementsandPrioritizationCriteria. The DGAEWMsupportedby Director OFWM and District basedwater managementstaff would be responsible for facilitating implementation of this componentthrough WCAs. 16 District Teams, and 50 Field Teams mentioned abovewould be engagedininformation dissemination, demandpromotion, screeningandranking o fWCA applications, facilitating establishmento fWCAs, surveying and designingwatercourses and storagetanks, entering into agreementswith WCAs andensuringquality ofworks carried out by the WCAs. Eligibility and ranlung criteria have beenpreparedas part ofthe ISEA and are includedinAnnex 2.1. Ingeneralthe selection and prioritization criteria seek to: support the ongoing institutional reforms inthe areas servedby AWBs, target small and tail end farmers, promote participation oftenants andwomen, and givepriority to areas that have saline groundwater (to minimize non-beneficial evapotranspiration and irretrievable water losses) and those that are water logged, to reducethe drainable surplus. 2.15 WCAs would canyout the works for watercourse improvement and construction o f storagetanks. An output basedagreement(OBA) wouldbe signed betweenthe DGAEWMandthe responsibleWCA (model contract form is available inProject Files). The OBA specifiesresponsibilities o fbothparties. Underthe OBA, DGAEWM(through fieldteams) wouldberesponsiblefor carrying out survey anddesign work --inconsultation with WCAs- and supervision duringconstruction, while WCAs wouldbe responsible for procurement o fmaterials and actual construction work. Once WCAs have completed about 1/3rdo f the earthen improvement work, including the construction of spurs, the DGAEWMwould release them an advance to procure materials. Subsequentpaymentswouldbemadeto WCAs upon satisfactory completion o f milestones specified inthe OBA. Services standards, including time taken by District and FieldTeams at eachstage ofprocessingWCA applications andrequest for releaseofpayments for completed works wouldbe specified inthe Project Implementation Plan (PIP). The DGAEWMmay award contractsfor watercourse survey and designwork to private f m s through competitive bidding. 2.16 Cost SharingArrangements. Forwatercourse improvement and construction of storagetanks, the Project will finance 90% o f the material costs, while WCAs wouldprovide skilled andunskilled labor costs (incash or kind) andcontribute 10percent o fthe materialcostsup-front, including the materials neededfor the spurs. The total share of WCA would be about 30 percent in SGW areas and 31%inFGW areas. Watercourses off-taking from direct outlets on main andbranch canals, andwatercoursesprimarily owned by only one or two farmers wouldbe ineligible for financial support from the project. For the latter, however, the project would provide technical assistancefor surveys and design. Topreclude use of unpaid laborfor renovation of watercourses and construction of water storage tanks carried out under the project, WCAs will be required to maintain labor muster rolls to demonstrate that payments have been made to skilled and unskilled labor employed. 2.17 GOSindh shall ensure that as a condition to obtain assistance for watercourse improvement andor construction o f a water storagetank and associatedworks, the farmers o f such area will have: (i) formed a fully functioning WCA at the level ofthe particular project works andregistereditunderthe SWMO; (ii) establishedthat such WCA has the technical capacity to participate inthe carrying out o f the particular project works; and (iii) acting through suchWCA reachedagreement with OFWMDirectorate, to share the costs of the particular project works and to cany out the particular project works under the output based contract and the O&M o f the facilities on which the particular project works are to be carriedout. -51 - Distributary andMinor Canalsimprovement 2.18 RationaleandJustification. The irrigation infrastructure is generally ina state o fdisrepair and rapiddeterioration due to utilization beyond design capacities, tampering o f control structures, damage to canal bankscausedby humanand cattle trespassing, and inadequateroutine and preventive maintenance. While there is an accumulation of deferredmaintenance all over the system, smaller channels (distributaries andminors) are the mostneglected. Turningover anonfunctional systemto FOswouldbe a recipe for failure o f the nascentFOs andthereby the reforms. Makingthe distributionsystemfunctional is, therefore, critical. 2.19 Targets andNatureofImprovementWorks. The project wouldprovide for improvement of about 100 distributary/minor canals, that are managedby FOs. The improvement works would not cover complete remodeling of distributaries andwill generally be of a low cost nature, not exceeding Rs 800 per ha o f area commanded. Schemeswith higher unitcost wouldbe undertakenonly ifthe economic rate o f return (ERR) exceeds 12percent. Such schemes would be submittedfor the Association's prior clearance. GOSindh shall ensure that: (i) construction works underthe project will be carried out inaccordancewith design criteria and specifications satisfactory to the Association; and (ii)inparticular, the distributary/minor canals included inthe project will be improvedto achieve sufficient capacity to deliver their full discharge entitlement determinedonthe basis oftheir share ofthe diversions at the headofthe maincanal command systemover the previous 10years. Typically, improvement works would include: (a) Restorationo f outlets, weak sections o f channel banks andberms, and de-silting; (b) Repair ofregulator gates, crossregulators anddiversion structures, protectionworks upstream and downstream o f structures and channel sides, cattle crossingsand cattle ghats (cattle drinking water points); and (c) Installationo f gauges and control structures for flow measurementat the distributary headandat each mogha (watercourse off take outlets). 2.20 ImplementationArrangements. AWB staffwouldberesponsiblefor informationdissemination, demandpromotion, screeningandrankingFOs applications for distributary improvement works. AWB staffwith the assistance of the PIA consultantswould also be responsible for facilitating identification, design and quality control o f distributary improvement works to be camed out through FOs. Criteria and methodology for selectionandscreeninginvestmentsunder the project has been developed as part ofthe ISEA, and are basedon similar considerations as for watercourse improvements. (see Annex 2.1). FOs wouldbe responsiblefor distributsuy canal improvements works. The works wouldbe identified and proposedby FOs on the basis ofjoint walk-through surveys along with AWB staff and PIA Consultants. AWB staffandPIA consultantswouldassistFOsinsurveys, designandpreparation o fbiddocuments and bidevaluation. Contracts costing morethan US$30,000wouldbeprocuredby FOsthrough National Competitive Bidding(NCB) inaccordancewith Bank Procurement Guidelines. The respective AWB XENs would act as the "Engineer" or "Project Manager" for purposesofcontract management. FOswould implementsmaller schemes costing less than $30,000 themselves (through "community contracts", in whch FOs would be the contractor), ifthey have the capacity to undertake the work. The AWBs would play the role o f "Engineer" inthese contracts as well. 2.21 Cost Sharing. As per current GOSindhPolicy, FOswouldnot berequiredto contribute to the capital cost of distributary improvement work. - 52 - BranchCanalsImprovement 2.22 RationaleandJustification. Likethe distributary canals, branch canals are also ina deteriorated state. Many are operating with inadequatefreeboard, erodedberms, inspection roadswith inadequate widths, deteriorated outsideembankments,severelyreducedcapacity due to sedimentation, andmany hydraulic structures inneedof repair. Improvements are imperative to deliverwater equitably amongst distributary canals. 2.23 Targets andNatureofWorks. The project provides for improvements of 25 branchcanals supplyingwater to distributaries managedbyFOs. Ingeneral, the cost ofthe works would not exceedRs 400 per ha o fthe area servedby these canals. Schemes with higherunit cost wouldbe undertakenonly if the ERRexceeds 12 percent. Such schemes would be submittedfor IDA'Sprior clearance. Improvement works would be similar to those envisagedfor distributary canals. Inaddition, the following type o fworks would be considered: (a) motorizationo f regulator gates, where necessary; (b) installationo f gauges andcontrol structures for measuring flows at the head o f the branchesand distributary off take points; and (c) installation o f a telecommunication systemfor monitoring andmanaging flows inbranch canals to improve water scheduling and safety of operations. 2.24 ImplementationArrangements. AWBs, assistedbyPIA Consultants, wouldbe the responsible for surveys, design, procurement and contract managementfor branch canal improvements. Inthe selectionof the branch canals for inclusioninthe project, preferencewould be givento branchcanals on whch distributaries/minors and watercourses are beingimprovedunder the Project. Project Component 3 US$ 5.42 million - ProductivityEnhancement 2.25 Despite the widespreadadoption o f green-revolution technology over the last three decades, major differences inproductivity exist across farms andregions inthe Sindh Province. Recent farm-level data from Sindh, for example, indicate that imgatedwheat output per hectarevaries from 0.5 to 5.4 tons per ha, highlightingthe large potential for improvingproductivity. This project component aims to improve productivity ina sustainable fashion by narrowingthe existingproductivity gaps, andenhancing resource use while advocating efficient andenvironment friendly agronomic practices (e.g. IPM,IPSNM). Specifically, the project will support simple, triedandtestedtechnologies andagronomic practices and implement some innovative pilots. PrecisionLand-LevelingWith Laser Technology 2.26 RationaleandJustification. Several studies inSin& andPunjab, includingone byIWMI, have demonstratedthat about 20% to 25% water is wastedduringfield applicationbecauseo fundulated and poorly leveled farms. Besideswaste o f scarce inigationwater, fertilizer use efficiency and crop yieldalso suffer due to over- andunder-irrigation indifferent parts of the same field. These losses can be avoided through precision landleveling (PLL). It is now well acceptedthat landleveling results insubstantial water savings and increasesproductivity, particularly ifcarried out with "laser guided" equipment. Besides water savings, PLL reduces the time farmers spendon irrigation, facilitates uniformseed germination, and increases fertilizer use efficiency. All together these factors increasecropping intensity and crop yields. - 53 - Laser technology for PLLhas beenintroduced in Sindhunder past On-Farm Water Management projects andthere is an increasing demandfor it. However, unlike other farm equipment this technology is notyet available with local equipmentrental outfits. The DGAEWMhadprocured 29 laser unitsunder past OFWMprojects for demonstration purpose. However, due to lack o f suitable arrangements for providing equitable access to farmers only a limitednumber of demonstrations couldbe made, andthese have generally targeted relatively large farms. 2.27 Targets andImplementationArrangements. The Project seeks to popularize and scale upuse of laser guided PLL technology inSindh by involving FOs inthe ownership and management o f leveling equipment. The Project envisages leveling about 100,000 acres (40,000 ha) of farm land. The annual output of one set o f levelingequipment, on average, is about 250 acres. About 150laser unitswith scrapers will be procured inphases and handedover to the FOs on a cost sharing (or matching grant basis) under aperformance basedagreement(see below). In the event that the demandfor PLL equipment exceeds the number of laser units procured, selection amongsteligible FOs will be made on the basis o f public ballots. Quotas willbe assignedfor various canal commands inproportion to the culturable commandedarea (CCA). Sixty percent o f PLL equipment will be reservedfor existingAWBs while 40% will be earmarkedfor other canal commands,with priority givento those canal commands where AWBs are to be establishedduringthe next four years. About 300 laser unit operators wouldbe trained. The project will provide the cost o f training. DGAEWM has training facilities and trainers at its various training institutes. FOs will provide the tractors required for runningthe scrappersandbear the full O&M cost. FOs will rent out the equipment to their members inatransparentandequitablemanner givingequalopportunity to small andlargeholders. The DGAEWM will provide technical assistance to the FOsand the Agriculture Department or private sectorworkshops, where available, will provide repair andmaintenancefacilities to the FOs, onpayment. 2.28 Cost SharingandMonitoring. FOswill contribute 50% ofthe cost of the laser unitand scrapper equipment. Initially the title of the equipment will be held inthejoint names o f GOSindh (representedby the DGAEWM)andthe concernedFOs. A modelperformance basedcontract agreementhasbeen developed(available inProject Files). Underthis contract, GOSindh's share inthe cost o fthe equipment will be gradually transferred to the FOs uponachievement ofphysical targets, specified inthe contract. A committee comprising of DGAEWM, Chairman of respectiveAWB andthe chairmen o f Farmer Organization Council (FOC) would supervise andmonitor the procurement, delivery andutilization of the equipment. The DGAEWM,onbehalfofthe committee, will monitor the targets and ensure that the equipmentis usedjudiciously andsmall farmers have access to the equipment. Criteria andmethodology for selectionand screeningFOs applications for investmentinlaser equipment are summarized inAnnex 2.1. DemonstrationCenters 2.29 The use o f efficient irrigation methods, farm desigdlayout, efficient and balanced use o f inputs, new technology as welljudicious and safe use o f fertilizer, pesticides and integratedplant and soil nutrient managementremains limited and is one of the key factors underlying low productivity inSindh. The Project will support establishmento f demonstration centersto disseminatea full range o f improvedwater managementand irrigationagronomy practicesltechniques; and training of FOs/WCAs inimprovedwater management, including a pilot for volumetric deliveryo fwater and assessment o f water charges on that basis, cultural practices, soil amendments for reclamation of saline andsodic soils, and new technology (land leveling, zero tillage, sprinkler anddrip systems, etc.); integratedpest management (IPM), and integratedplantand soil nutrient management(IPSNM). - 54 - 2.30 Targets. One demonstrationcentereach would be establishedinthejurisdiction o f about 90 FOs inAWBs, and 10innon-canalcommandedareas, to demonstratesustainablewater andsoil management practices. These centerswould be up to 2 ha insize, and locatednear villages for easy access and visibility. FOs will beconsulted insite selection. The Project will assist the FOsto operatethe centers for two years after which they would be transferredto FOs. The centerswill demonstratea fullrange ofwater managementpractices (improved farmdesignand layout, efficient on-farm water management(e.g. border irrigation, bedand furrow), new technology (e.g. minisprinklers, drip, bubblers)and irrigation agronomy techniques. The project would provide equipment andtechnical assistance for the planningand design of water management improvements, includingmaterials andprecision landleveling. Farmer Field Days wouldbe held at these demonstration centers duringeach crop season. 2.3 1 ImplementationArrangements. Staff o fDGAEWMand Training Institutes wouldbe responsible for demonstration o f improvedirrigation and on-farm water managementpractices while agriculture extension staff would be responsiblefor demonstrating improvedagronomic practices. These staff teams would be supportedby the PIA consultants' FarmManagement Specialistswho will also train staff and farmers associatedwith these centers insustainable agricultural practices and farm management aspects. Female extension personnelof government, NGOs, andconsultantswould encouragewomen's participation. IntegratedPest Management (EM) 2.32 Rationale. Improvement o f distributary canals andwatercourseswouldresult inthe availability of additional water leading to expansioninagricultural area and higher crop yields and corresponding higher use ofpesticides. Inappropriate use ofpesticideshas been instrumental inthe killing of non-targetedand friendly organisms, includingbirds, andhas also induced pestresurgences. The social costs ofpesticide use havebeen high. These include: occupational poisoning, pesticide residueson food, drinkingwater contamination, pest resistance, loss ofbiodiversity, cost ofpreventionandabatementmeasures, andthe cost o f awareness campaigns. A Pest ManagementPlan (PMP) has beenprepared (summary inAnnex 11). The mainmitigating measureis the promotionof IntegratedPestManagement (IPM) practices inthe project area. Along with IPM, the concept o f IPSNMwould also be introduced inthe project area to minimize the use o f chemical fertilizers. 2.33 The Government o f Pakistanthrough the NationalAgriculture ResearchCenter (NARC) is implementingan IPMProgramon country-wide basis.Under this Program, extension staffandthe growers are being practicallytrained inlearning and subsequentlyimplementingthe I P Mmethodology, whch essentially includes the proper identificationo fpestsandtheir natural enemies on various crops. The mode o ftraining would be that o f informal educationemphasizing fieldwork on the basis o f learning by doing, anddemonstration.Through these interventions the mainobjective o fthe project to ensure enhanced productivity without having adverseeffects on agricultural environment andbiodiversity is expectedto be achieved. 2.34 Targets. Even so, a sum or Rs. 33.1 million has beenset-aside under the Project for the following supplementaryIPMactivities in Sindh: (i) launching awareness raising programs anddissemination o f information on IPMand IPSNM; (ii) training of 150 extension staff and 10,500 farmers inIPMpractices; (iii) out25demonstrationplotstodemonstratethebenefitsofIPSNM;and(iv)monitoringof laying pesticide residue on agricultural crops. However, before embarking upon the above supplementarytraining programs, it is consideredappropriate to monitor the implementation andoutcomes of the recently approvedNational IPMtraining programfor one year. A decision whether or not to implement a supplementaryprovincialIPMtraining program would be taken one year after the start o f the project on - 55 - the basis o fthe performance of the national IPMproject. The activities listed as (i), and (iv) would, (iii) however, be undertakenfrom the first year o f the Project. Effects o fproject interventions would be regularly monitored. The key monitoring indicators would be: (i) quantity ofpesticide used; (ii) of number sprays andarea sprayedby crop; (iii) pesticide residues on fruits andvegetables; and (iv) use o fbanned pesticides. 2.35 ImplementationArrangements. At the provincial level, Director, Plant Protection (PP) locatedin the office o fthe Director General, Extensionwould be the overall in-charge ofthe program. Actual implementation would be done by Taluku levelAgriculture OfficersFieldAssistants who would report to and seek guidance from Director, PP through their district level superiors. Director, Agricultural Informationwould assist Director, PP inimplementing the awareness raisingldissemination o f information component. IntegratedPlant andSoilNutrientManagement(IPSMM) 2.36 Rationale. IPSNMpertainsto the combineduse of organic andinorganic fertilizers inproper proportion accompaniedby sound cultural management practices incrop production. It is an approachthat seeks to both increaseagricultural productionand safeguardthe environment for future generations. Researchhas provedthat neither inorganic fertilizers nor organic fertilizers alone can achieve a sustainable productivity o f soils as well as cropsunderhighly intensive cropping systems. Also, as water is becoming scarce, the application o f organic fertilizers needs to be encouragedto increasethe soil's water holding capacity. For the benefit o f farmers, plots would be laid out to demonstratethe use o f organic fertilizer, greenmanuring,mulching, weeding ,leguminous crops for nitrogen furing, composting, and wormi-culture. 2.37 Targets. A pilot scale operation, inconcertwith WCAs andFOs, wouldbeundertaken inthe project area to promote the use o f organic fertilizers/residues. Since the activity would initially affect farmer income and only benefit himinthe longer term, suitable financial incentives would be providedto the farmers under the project to compensate them for the losses incurred. About 25 demonstration plots would be laid out to promote IPSNM inthe project area and the results wouldbe monitored. As part of this pilot, the project would encouragefarmers to initiatemicro level enterprisesby WCAs/FOs for composting and earthworm culture to enhance soil productivity. 2.3 8 ImplementationArrangements. TulukalevelAgriculture OfficersFieldAssistants ofDistrict Governmentswould implement the program under the overall supervision of the Director General, Extension. InformationKiosks 2.39 Farmersgenerally do not have ready access to information on availability, adequacy and scheduling o f water inthe imgation system, and on markets (supplyldemand and prices o f crop inputs and outputs). Timely availability of this information would greatly help farmers to better plantheir agricultural production activities, includingprocurement of inputsand marketingo f outputs. The project would support establishing a simple systemto collect andmake accessibleto farmers, informationon canal water availability as well as input andoutputs (supply and demand) andprices. The AWB together with progressiveFOs would take the lead inestablishing one pilot information kiosk each in3 AWBs. The SIDA Meda Cell and PIA consultantswill help AWB andFOsdesign and initially managethese kiosks. Gradually the AWB or FOs would take them over. - 56 - Project Component4 US$1.73 million - MonitoringandEvaluation 2.40 Monitoringwould be designed to provide for continuous learningand adjustment of project approach and involve: (a) participatory monitoringbasedon self-defined indicators (byFOsandWCAs), (b) monitoring dataon inputs,outputs andimpacts/outcomesby DGAEWMthrough the M&E consultants, and(c) IDA supervision. The implementation of the recommendations of ISEA (Implementation Framework) would be monitoredas part of the overall arrangements for monitoringproject performance. Detaileddesign o f the M&E systemwould be completedwithin 3 months ofproject start. Baselinesurveys wouldbe carried out as sub-proiects for distributarv andminor canal rehabilitation and watercourse improvement are selected. Remote sensing wouldbe usedas appropriate. The monitoring framework including institutionalarrangementsand indicators wouldbe submitted to the Association by September 30, 2004. The key indicators for process, inputs, outputs and project outcomes/impact would, inter alia, include: OutcomeDmpact Indicators(At the endofProject-comparedto baseline): (i) Improved O&M and water distributionindistributary canalsmanagedby FOs (improved reliability andequity o f irrigationwater distribution) (ii) Improvement inwater conveyanceefficiency inimproved watercourses (iii) Increaseincroppingintensity (iv) Increaseincrop yields (v) Reduceduse ofpesticides (vi) increasedhouseholdincomes OutputIndictors(At the end ofproject) (i) WCAs and FOs establishedinaccordancewith SWMO 2002, are active, conducting business democratically, providing responsive, sustainableservicesto communities as measuredby indicators included inAnnex 1and summarizedbelow: Improvedbranch and distributary canalshave adequate capacity to carry full design discharge. Decreaseincanal breaches Increaseinwater supply at farm gate as comparedto baseline Increaseinwatercoursedeliveryefficiency farmers on 100 distributaries demonstrateknowledge o f improvedpractices farmers canyout PLL Timely feed back providedand taken into account inimprovingdesign andimplementation Project incentive framework for promotingparticipationof women and sharecropperstested and proposals for improvement made lessons learnedfor future operations Project implementedefficiently andin timely manner Quality of works and services completed is satisfactory Implementationo f the environmental managementplans andPMP - 57 - Process Monitoring Indicators (i) Formation and institutional developmento f FOs andWCAs (e.g. conformity with provisions o f SWMO 2002 and ImplementationFramework, selection of farmer representatives, decision malung within FOsiWCAs andtheir involvement insubprojectplanningand cost contribution); (ii) Capacity buildingo f FOs andWCAs for management o f O&M; (iii) Operation and maintenanceperformance (equity regardingtimely andadequate water supply throughout the system; inclusion o f small farmers; O&M performance); transparencyregarding decision making,resourcemobilizationandfinancial management; conflict resolution, basedon both self-evaluation and external assessmentby the M&E consultants; and (iv) Framework for O&M o f irrigation works through SIDA, AWBs, FOs, WCAs. 2.41 The DGAEWM, assistedby M&EConsultants, would be responsible for maintainingthe M&Edatabase. Itwould monitor physical and financial progress, analyze key performance indicators, and collate quarterly progress reports, for submission to the PSC and the Association. The M&EConsultantswill help DGAEWMestablish a spatial GIS database (with georeferencing). Progress o fvarious componentswould be monitoredas an integral part o fproject implementation. Eachimplementing agency would contribute to the M&Esystemmaintainedby theDGAEWM. 2.42 The M&Econsultantswould field amultidisciplinary team of senior, mid-and junior-level professional staff and support staff to provide services for M&EProgram. A core team will be assignedto work with DGAEWM, SIDA, AWBS and FOs at Hyderabad. The core team will have expertiseinM&EofWater ResourcesProjects, GISiInformation Management, Agricultural Economics, Agronomy, Irrigation, SociaWoverty Monitoringand Environmental Monitoring, etc. Two (2) fieldteams will be established. The M&Eactivities would focus inareas, where all componentsof the Project would be implemented. 2.43 The Bank would supervisethe project twice a year, on an average. Besides, staff with skills ininigation andwater management, the task team would include environmental, social development, GIS, IPM, and M&Especialists. 2.44 A mid-termreview (MTR) would becarried out duringthe secondyear ofproject implementation, at which time the governmentwould review the implementation of the project with IDA on the basiso f supervision andmonitoringprogram outcomes. The midtermreview would evaluatethe overallprogress, assess the needfor any mid-course corrections, adjustments indesign and scope, implementation approachand methodology, andrevisit policy aspects to ensure timely completion o fthe project's activities and satisfactory outcomes consistent with the development objective. An implementation completion report (ICR) would be preparedwithin six months afier the closing date. Project Component 5 US$3.47 million - Project Management Support 2.45 Project implementation assistance (PIA) consultants will provide DGAEWM, SIDA, AWBs and FOsiWCAs with project management support for project launch, engineering and quality assurance, procurement, training andcapacity building,productivity enhancement, andmanagementinformation system. The consultants wouldberequiredto fielda multidisciplinary team o f senior, mid-andjunior-level - 58 - professional staff and support staff. A core team will work with DGAEWM, SIDA, AWBs andFOs at Hyderabad, while four (4) field teams will be established. 2.46 The consultantsCore Team will include specialistsinWater Management,Design o f Canals, Management Information System, Productivity Enhancement, Procurementand Contract Management, Environment, Social Mobilization, Gender, etc. and support staff. Responsibilities of the Core Team o f the Consultants will, inter alia, include: a. assisting DGAEWM, SIDA, AWB and FOs inproject launch, designinga dissemination program, familiarizing project staff with the Implementation Framework, screeningsub-projects, andpreparing annual work plans; b. assisting all implementing agencies inall aspects ofprocurement(preparing andupdating procurement plans, preparing biddocuments, evaluation reports, contract awards); c. preparation and assistance inimplementation o f a training and capacity buildingprogram for project staff, FOs and WCAs; d. designing andassistingwiththe implementationof productivity enhancementprogram; e. conducting training o f social mobilizers of field teams, and assistinginaspects concerning inclusion o fwomen andtenants inproject supportedactivities; f. assisting inestablishmentofaninformationsystemfor AWBs andFOsandhelpingto setup demonstration centers(including a pilot for volumetric water delivery and abianaassessment) andpilot informationkiosks; g. assistingthe DGAEWMwith preparation ofconsolidatedperiodic progressreports andthe implementation completion report; h. assistingmanagementinpreparingandprocessingwithdrawal applications; and i. ensuringthatAreaWaterBoards(AWBs)workcloselywithFOsinplanningrehabilitationof branchcanal, distributaries and minors canals. 2.47 The consultantsfieldteams will include multidisciplinary staffwith expertise inwatercourse improvement, canal improvement, productivity enhancement, farmmanagement and support staff and will be responsiblefor the following, inter alia: (i)assistAreaandFieldTeamsofDGAEWMandWCAsbyspotcheckingsurveys,design,and quality control o fwatercourseimprovements; (ii) AWBandFOsbyspotcheckingofsurvey,designsandqualitycontrolofbranchand assist distributary improvements; (iii) AWBsandFOsestablishinformationkiosk;and help (iv) assist DGAEWMandAgriculture Extension staff inestablishing demonstration centers, andIPM and IPSNMactivities - 59 - 2.48 Year-wise PhasingofWorks is summarizedinthe table below: Sr. 1 Description 1 Unit I Year-1 Year-2 Year-3 Year-4 1 I I 1Total I /(iii) Improvementof BranchCanals B. Training FOs, W A Sand Staff Nos. 3,50C 4,000 3,500 1,500 12,500 Training of Laser Operators Nos. 60 80 80 80 300 C. Integrated PestManagement IPMthrough TofFFS MRs. - 0.655 3.930 9.170 13.755 1 IIPNSM Demo. Plots I 0.50d 1.25d 0.75d 2.5001 2.49 AnnualPlans.Starting from the year 2004, GOSindhshall, not later thanMarch31of each year, prepare a consolidated Annual Plan (AP) for the next fiscal year, including procurement plans and budget for implementation of Project activities, and, taking into account the Association's recommendations finalize the AP not later than May 31, each year. The planfor FY05 is included inthe PIP. - 60 - Annex 2.1 SummaryofProjectImplementationFramework An ImplementationFramework (IF) has beenpreparedas a part o fthe ISEA, Part-1 ofthe IFoutlines the processandkey steps involvedinthe implementation of each project component, while Part-2 indicates the responsibilities for implementation, supervisionandmonitoring. A summary of the processes andkey steps i s presentedbelow. 1.1 Watercourse Improvement Fipure: 1Flow Chart of Activities for WatercourseImprovement. 1 Formation& Reaistrationof WCA I fI - f ExistinaWCA II l n i t i a l Screening/Eligibility I I Mobilization/ Building I Gap DetailedScreening/Ranking Selection/Approval ~ 5- Survey/Design/Estimates Agreement & Implementation/Mitigation I I 1 I 1 I Monitoring/Reporting Supervision - 61 - 1.1.1 Eligibility Criteria.Existingaswell asnewly formed WCAs wouldbe eligible for assistance. For WCAs the following eligibility criteria would apply: The WCA is registered. The recordofgeneralbody meetingsandManagementCommittee meetings is maintained. The WCA agrees on cost sharingarrangementsfor improvement of the watercourse. The WCA has openeda sub project bank account for improvement ofthe watercourse. Notes: 1. Ifthe WCA fails to qualify underany ofthe aboveeligibility criteria, theWCA willbeaskedto rectify the short falls within a givendate and then re-apply. Fullassistance / capacity building efforts will be extendedto the WCA by the fieldteams 2. Watercourses with direct outlet on mainandbranch canals and watercourses ownedby one or two farmers will not be eligible for financial support. Only technical assistance could be provided by the Project. 3. For watercourses outside AWBs the additional eligibility criteria summarized inPara 2.08 of Annex 2 would also apply. 1.1.2 ScreeningandRanking For WCAs who meet the eligibility criteria, their watercourseimprovement proposals will be screenedusingthe criteria describedbelow andwouldbe taken up for implementation ifit secures a minimumscore of40%. Incase the demandexceeds implementation capacity or project targets, then all the applicants will be screened as per following criteria and a priority-ranking list will be prepared. i) Location of the Watercourse on the Distributary (LS) Since the watercourses on the tail endusually face relatively more problem o fwater shortages, they will be givenpriority incomparison to the watercourses located at the head andmiddle. The location score (L.S) for eachwatercoursewill be computed as under:- L.S = = x 100, where T.L LWC is the R.D (1 RD = 1000ft) of the distributary from where the w/c module takes-off. T.L is the total lengthofthe distributary inRDs. This implies that the higher the score of location of the W/C, the higher the priority attachedin selection for improvement. Preference would be given to those watercourses, which are located on distributaries and minors that are to be rehabilitated under the Project. L.S for watercourses on distributaries and minors that are to be rehabilitated under the Project will be the same as calculated above. For watercourses on distributaries and minors that are not to be rehabilitatedunderthe Project, the Location Score will be reduced to 0.6xL.S. ii) PresenceofSmallFarmers. One o f the objectives o f the project is to help small farmers. For this purpose priority may be givento those watercourses where proportionof small farmers (i.e. owning less than 16 - 62 - acres each) are high. The smallfarmer score (SFS) will be computed as under:- SFS = = x 100, where C C A LSF =Total landonthe watercourse ownedby small farmers. CCA = culturable command area o fthe wlc. This implies that the greater the share o f land owned by small farmers on the watercourse, the higher the priority attached to it for selection for improvement. iii) ParticipationPercentageofFarmers The W C A could be formed and registered if 66% o f the farmers on a watercourse agree to form the WCA. However, agreement o f 100%farmers is desirable because WCA will be more cost effective andimprovement o f watercourse will be easier. Thus participation percentage criteria will be included inselection I rankingas under. PPS =No of farmer members ofWCA x 100 Total No. o f farmers on the wlc The higher number o fparticipating farmers, the higher will be its ranking score. iv) Groundwater Oualitv The quality o f ground water will also be used as one o f the screening criteria for selection of sub project because the loss o fwater insaline groundwater areas is irretrievable for imgation purposes and as such, liningwould help water conservation. The score o f saline groundwater will be 100andthat for fresh ground water will be 60. Depth to GroundWater Score Less than 5 feet 100 5 to 10 feet 60 More than 10 feet 40 vi) Women's Participation As proposed inthis framework, to ensure womenparticipation inthe sub project (provided that there are women landholders on the Watercourse), 5 grace points would be added to the total score for rankingpurpose, ifwomen are members o f the WCA. vii) Tenant Participation To promote tenantparticipation inthe sub projects, 5 grace points would be added to the - 63 - total score for rankingpurpose, ifa Tenant Organization exists on the Watercourse and the WCA agrees to give a labor contract for unskilledlabor, requiredfor watercourse improvement, to the Organization. 1.1.3 Weightage. The following Weightagewill be appliedfor the criteria describedabove. Location =0.20 Small fanners = 0.20 Participation%age =0.15 Ground water quality = 0.20 Groundwater depth =0.25 Total = 1.00 Total score (TS) =L S X 0.20 +SFS X 0.20 + PPS X 0.15 + GWQS X 0.2+ GWDS X 0.25 Add 5 points to the total score ifwomen (ifapplicable) aremember ofWCA Add 5 points to the total score if the WCA agrees to give a labor contract for unskilledlabor, requiredfor watercourseimprovement, to the Tenant Community Organization. The higher the total score, the higher will be its ranking for selection. The above Weightage will be reviewedandadjustedbasedon the experience gained inconsultation with the Association. 1.2 DistributarvImurovement 1.2.1 Eligibility Criteria Existing as well as newly formed FOs will be eligible for assistance for improvement of distributaqdminor canals. For the formation o f new and existing FOs, the following criteria will apply. FO Formation: The distributqhinor canals on which FO is to be formed, fall withm one ofthe notified AWs. 2/3rd o f the command area ofthe FOs is covered by WCAs. The informationrequiredbythe Regulatory Authority, including certified copy ofRegister of abiana payers and leaseholders,i s submitted as per Water Management Ordinance 2002. The flow chart of activities for improvement of distributary/minor canals is shown inFigure-2. The criteria similar to that describedunderwatercourse improvement will apply. DistributaryImprovement EligibilityCriteria: FO is registeredwith the Regulatory Authority. FOperformance is satisfactory as indicatedbyAbiana collection, performance inO&M and availability of a business plan. There is needfor improvement e.g. loss o f freeboard, absence ofberms, degradation o f channel, section and inspection path andreduction of discharges at the tail, damagedgates, structures, outlets. - 64 - . NOTE: IftheFOfailstoqualifyunderanyoftheaboveeligibilitycriteria, theFOwillbeaskedto rectify the short falls within a given date and then re-apply. Full assistance /capacity building efforts will be extended to the FO by the field team, OFWM. Fimre: 2 Flow ChartofActivitiesfor FO formation& DistributarvImprovement Demand Generation/AwarenessCamDaian I t Formation& Reaistrationof FO t * I Amlication from FO Existing FO I I I I I I f I InitialScreening/Eligibility Mobilization/ Capacity Building I Pass I I DetailedScreening/Ranking Selection/Approval Survey/Design/Estimates Bidding/Evaluation/Contract/Award - Implementation/Mitigation - 65 - 1.2.2 Ranking/ScreeningCriteria Ifthe subprojectpassesthe eligibilitycriteria, itwillbescreenedusingthecriteria describedbelow andwouldbe taken upfor implementation ifit securesa minimumscore of40%. Incasethe demand exceeds implementation capacity or project targets, then all the applicants will be screened as per following criteria anda priority-ranking list will be prepared. The rankingI screening criteria for distributary improvement is sub-divided into seven categories as described under watercourse improvement for calculating the score. Location o f the Distributaryhlinor on the maidbranch canal. Proportion o f Small Farmers at Distributaryhlinor. Participationproportion o f W C A inFO. Ground Water Quality. Ground Water Depth Women's participation. Huri (sharecropper) participation. Weightage similar to that described under watercourse improvement will be used. 1.3 BranchCanalImprovement There is provision o f improvement o f 25 branch canals feeding the distributaries on which FOs have been formed. The improvement o f the BranchCanals will be undertaken bythe AWB on purely technical and need grounds. Ingeneral, the cost o f the works would not exceed Rs 400 per ha o f the area served by these canals. Schemes with higher unit cost would be improved only iftechnical viability is assured andeconomic analysis done by the implementingagencies andverified by PIA consultants, and show an economic rate o f returngreater than 12 percent. Preference (a higher weightage inprioritizing criteria) would be given to Branch Canals on the basis O f Need for improvement Preference would be given to branch canals on which distributarieslminors andwatercourses are being improved under the Project. 1.4 PrecisionLandLeveling 1.4.1 EligibilityCriteria: The FOs must be registered. The FOs mustbe willing to appoint two laser unit operators for training The FOs deposit Rs 25,000 as advance inthe form o f a demand draft in favor o f the DGAEWM The FOsor the WCAs deposit demand drafts inthe name of the supplier as per following schedule: 10%o fthe cost at the time o f ordering the equipment. 40% o f the cost at the time o f delivery o f the equipment The FOs or the WCAs include their share o f cost intheir approved budgetshusiness. - 66 - 1.4.2 Screeninflanking Criteria: Preferencewould be given to: FOs inthe tail endareas FOs with largernumber ofmembers-- laser equipmentwill notbeprovidedto individual farmers. Institutional capacity of FOsas indicated by performance on abiana collection (applicable only to FOs within AWBs), andperformance inO&M. Figure:4 Flow Chart of Activitiesfor Precision Land Leveling Demand GeneratiodAwareness Campaign I Application from FO/(s) or group of WCAs with advance of Rs 25,000/- Detailed Screening/Ranking a Selection/Approval Agreement DGAEWM/FO And payment of Demand Draft for 10%cost Training of Tractor Operators a Supply of Equipment on payment of 40% cost I I - 67 - DemonstrationCenters A total of 100demonstrationcenters will be established. Onlyone demonstration center will be established inthejurisdiction of one FO. Eligibility Criteria: a. The FO must be registered with SIDA or approved for formation under the Sindh Water Management Ordinance 2002. b. The FOmust propose a W C A already registeredwith it for establishing the demonstration Center. C. The proposed W C A must be either on an improved watercourse or have the watercourse improvement scheme approved andmust be within the command o f a distributary/minor to be improvedunder the Project. d. The size o f the demonstration center should be about 2 hectares andWCA must agree to provide access to the land. e. The locationmustbe easily accessible to farmers f. The WCA must agree to provide water, labor and other inputsrequired for the demonstration. g. The W C A should c o n f i i to allow field days andvisits o f farmers o f the other WCAs on the FO as well as from other FOs. h. The soil type andwater availability should be generally typical o f the area. - 68 - Annex 3: Estimated Project Costs PAKISTAN: Sindh On-Farm Water Management Project A. Social MobilizationandCapacity Building 4.17 0.3 1 4.48 B.ImprovementofIrrigationFacilities 0.00 (i)ImprovementofWatercourses 48.67 2.44 51.11 (ii)ImprovementofDistributaries 8.01 0.58 8.59 (iii) Improvement o f Branch Canals 3.40 0.28 3.68 C. Productivity Enhancement 4.61 0.36 4.97 D.MonitoringandEvaluation 1.34 0.27 1.61 E.Project Management support 2.58 0.65 3.23 Total Baseline Cost 72.78 4.89 77.67 Physical Contingencies 0.00 0.00 0.00 Price Contingencies 6.79 0.31 7.10 Total ProjectCost; 79.57 5.20 84.77 Total Financing Required 79.57 5.20 84.77 I Local Foreign Total Project Cost By Category 1 US $million US $million US $million i Goods 3.96 1.32 5.28 Works 59.27 2.99 62.26 Services 2.22 0.67 2.89 Training 1.05 0.01 1.06 Incremental Staff 8.55 0.00 8.55 IncrementalAdministrationand Operating Cost 4.52 0.21 4.73 Total Project Cost; 79.57 5.20 84.77 I Total Financing Required 79.57 5.20 84.77 1Identifiable taxes andduties are 4.98 (US$m)and the total project cost, net oftaxes, is 79.79 (USSm). Therefore, the project cost sharing ratio is 76.62% of total project cost net oftaxes. - 69 - Annex 4: Cost BenefitAnalysis Summary PAKISTAN:Sindh On-FarmWater ManagementProject Summary ofBenefitsandCosts: The project will increaseagricultural productivity on a total area o f about 760,000 ha, as a result o f improvedavailability, reliability and equity o fwater deliveries, andadoption o f improved on-farm water management andagronomic practicesby farmers. Direct quantifiable project benefits would include annual incremental agricultural productionwith estimatedvalue o f Rs 1,486 million (June 2003 prices) and creation of additional 2.5 millionworkdays per year of farm labor at full development due to increased cropping intensityandyields. Indirect andnon-quantifiable benefits would includereduceddrainage requirements; reduced soil salinity risks; reducedincidence o f stagnant pools o f water anddecrease in mosquito-bome diseases; andreducednegative impact of waterlogging on buildings androads. The Economic Rate ofReturn(ERR)of the project is estimatedat 21percent. The ERRis robust and not very sensitive to variations inthe project costs or benefits. MainAssumptions: Benefitsof ProjectComponents EvaluationofPastExperience WatercourseImprovementsandWater Storage Tanks. Evaluations ofpastwatercourse improvement projects (e.g. Third On-Farm Water ManagementProject) show that watercourse improvement resulted ina 26% increaseon average inthe amount of water deliveredto farms. Increasedwater supplies ledto highercropping intensity andyields, as well as some shift towards hghervalue crops. InSindh cropping intensities increasedby 8% compared to control areas. There was a 9%-13% increaseinyield o f paddy; 4%-11% for wheat; 5%-12% for seed cotton; 14%-28% for sugarcane; 8% for fodder and4% for orchards. Since these pastprojects included primarily watercourse improvement with no investment inthe distributaries and productivity enhancement measures, the above benefits can be attributed to watercourseimprovement only. The ICR o fthe Third On-Farm Water Management Project estimated that farmers savedabout 50% o f the labor originally neededfor irrigation and as muchas 10 dayshdyear on maintenance. BranchCanal,DistributaryCanalsImprovements. Becauseofpoor O&M the irrigation systemhas deterioratedto the extent that the reliability andequity o f water delivery and distribution has been adversely affected. Monitoring o fpast Irrigation SystemRehabilitation Projects show that, without rehabilitation cropping intensities gradually decrease. Studies conducted by the Punjab Economic ResearchInstitute (monitoring o f the Venoi Distributary) indicated that there was a decrease o f about 7 percent in cropping intensity over a period of five years. There is also evidence that supplies to tail-ends o f distributaries improve whenever silt clearance is carried out. ProductivityEnhancement Landleveling. Several studies inSindh andPunjab, including one - carried out by the International Water Management Institute (IWMI), have demonstrated that about 20% to 25% water is wasted duringfield application because of undulated and poorly leveled farms. Besides waste o f scarce irrigation water, fertilizer use efficiency and crop yield suffer due to over- and under-irrigation indifferent parts o f the same field. These losses are avoided through precision land leveling(PLL). Iti s now also well acceptedthat landleveling results insubstantial increasesin - 70 - productivity, particularly ifcarried out with "laser guided" equipment. Besideswater savings, PLL reducesthe time that farmers spendon irrigation, facilitates uniform seed germination, andincreases fertilizer use efficiency. All together these factors increasecropping intensity and crop yields. ImprovedManagement. It has beenobservedinseveralpilots inPakistanand elsewherethat increasedparticipationof farmers inO&M results inreduced cost, improved quality o f O&M, and improved equity o fwater distribution both within watercourses and distributary canal commands. While there is insufficient informationto quantify the financial andeconomic benefits o f the change in management from apublic sector runsystemto one managedby farmers, it is clear that benefits do accrue. ProjectedBenefitsandRelatedAssumptions Area Benefitted. The physical interventions supportedbythe project includeimprovement of4,000 watercourses, 100 distributary canals and25 branch canals; construction o f 200 water storage tanks, and leveling of 40,000 ha of farm land. These interventions would lead to improvement inwater deliveryand application efficiency. The extent o f areas benefittingfrom these interventions is summarizedbelow: Project Investment Area (ha) Remarks 1. Watercourse Improvement inAWBs 328,800 2,400 watercourses with average command area o f 137 ha each 2. WatercourseImprovementoutside AWBs 191,800 1,400 watercourses with averagecommand area of 137 ha each 3. Watercourse Improvement and Storage 6,000 200 watercourses inbarani areas with Tanks inbarani Areas average command area o f 30 ha each Subtotal (Area servedby improved 526,600 watercourse) 4. 100Distributary/Minor Canals 568,500 Based on total CCA and total number o f Improvement inAWBs distributary canals in3 AWBs 5. Laser LandLeveling 40,000 Total Area Benefitted(2+4) 760,300 Area under 100 distys. plus area under watercourses improvedoutside AWBs Since the coverage o f different project interventions overlap, the benefitting areas would fall in the following broad categories: (i) Areas where all interventions (watercourse improvement, distributary andbranch canal improvement, and landleveling) would be carried out. (ii) Areas where only watercourseswould be implemented. (iii) Areas where only distributary improvements would take place. While the extent o f area falling ineacho f the above categories cannot be estimated accurately, for purposes o f financial and economic analysis a conservative estimate o fthe area benefitted has beenmadeby taking into account only the area servedby improvedwatercourses (526,600 ha, including items 1,2, and 3 in above table). The areabenefittedby distributary improvement alone has not been taken into account. -71 - CroppingIntensities.Data on landutilization statistics (Agricultural Statistics ofPakistan 2001-2002, published by the Ministryof Food and Agriculture, Government ofPakistan) has been usedto estimate present cropping intensities based on the average of last 15 years. Based on these estimates the average pre-project cropping intensity is estimated at 66% inirrigated areas and 52% inbarani areas. As indicated above, past watercourse improvements inSin& have resulted inan 8% increase incropping intensity on average. Increase incropping intensity inareas that receive distributaryandother improvements as well, would be more than 8%. As indicated above the extent of areasbenefitting from various project interventions or a combination thereof cannot be estimated precisely. Therefore, a conservative assumption has beenmade that there would be an overall increase of 10%incropping intensity inproject area. Based on this assumption, with the project, the cropping intensity would increase from 66% to 73% inirrigated areas, and from 52% to 51% inbarani areas served by water tanks and improvedwatercourses. CropYields. Published statistics (Crop Area and Production byDistricts 1999-2000to 2001-2002, MinistryofFoodandAgriculture Government ofPakistan), have beenusedto estimate pre-project crop yields. The estimates of future yields with the project are based on the average yield increases achieved under the ThirdOn FarmWater Management Project as mentioned above. The table below summarizes the projected yields. ProjectedYields FullDevelopment Crops Baseline (Kg/Ac) %Increase Yr 2001-02 WOP I wp FWOP~FWP KharifCrops Cotton 348 355 378 2.0% 8.5% Rice 1,149 1,160 1,275 1.0% 11.0% Sugarcane 21,457 22,530 26,392 5.0% 23.0% KFodders 7,216 7,360 7,793 2.0% 8.0% KVegetables 2,645 2,671 2,840 1.0% 7.4% KOrchards 1,588 1,620 1,652 2.0% 4.0% RabiCrops Wheat 1,048 1,069 1,127 2.0% 7.5% RFodder 12,560 12,811 13,565 2.0% 8.0% RVegetables 3,601 3,637 3,867 1.0% 7.4% R Orchards 1,656 1,689 1,722 2.0% 4.0% FWOP:Futurewithout project: FWP: Futurewith project (over aperiodof ten years) - 72 - Agricultural Production Based on the above the estimated incremental production as a result o f the project is summarized below: Crops I Annual Production(000 tons) Baseline I FWOP I FW P IIncremental Kharif Crops Cotton 64.36 65.64 76.81 11.17 Rice 168.29 169.98 205.49 35.51 Sugarcane 1,490.38 1,564.90 2,016.49 451.59 K.Fodders 3 14.56 320.85 373.69 52.85 K.Vegetables 46.91 47.38 55.42 8.04 K.Orchards 33.47 34.14 38.29 4.15 RabiCrops Wheat 295.69 301.60 349.65 48.05 R. Fodders 665.65 678.96 790.82 111.86 R.Vegetables 79.04 79.83 93.38 13.55 R. Orchards 30.54 31.15 34.93 3.79 FWOP Futurewithout project: FWP: Futurewith project (at full development) Prices. For the financial andeconomic analysis, prices of inputsand outputs have been expressed inJune 2003 constant values. Farmbudget analysis is based on prevailing market prices. Economic evaluation is done usingeconomic prices. Financial and economic prices used inthe analysis are given inTable 4.1. FarmIncome The project would benefit about 178,500 farm families with an average family size o f 6.8 persons per family. Of these, approximately 160,000 would be families operating small farms ( less than 7 Ha). The estimated change infarm incomes (infinancial prices) for large, medium and small farm models is summarized below. It is evident that the project will result inhigher benefits to small farms (17 Acres--7 Ha), who would have an average o f about 27% increase infarm incomes compared to 16% for large farms (50 Acres - 20 Ha). - 73 - AverageFarmIncome(Rupees) FarmSize /Baseline IFWOP /FWP IIncremental SmallFarm(17 Acre-7Ha) - Gross Revenue 112,972 115,616 141,323 25,707 - Gross Costs 64,276 66,570 79,556 12,986 Net Revenue 48,696 49,047 61,767 12,721 Increasefrom Baseline (%) 0.7 26.8 I I I 1 MediumFarm(32.5 Acre- 13 Ha) - Gross Revenue 180,292 184,116 216,838 32,722 - Gross Costs 101,637 105,316 122,024 16,708 Net Revenue 78,655 78,800 94,814 16,014 Increase from Baseline (Yo) 0.2 20.5 LargeFarm(50 Acre- 20 Ha) - GrossRevenue 253,965 259,512 293,941 34,429 - Gross Costs 145,412 150,865 167,877 17,012 Net Revenue 108,553 108,647 126,064 17,417 Increasefrom Baseline (%) 0.1 16.1 Baseline cropping intensity has been estimatedat 72 percent for small farms (17 acres), 63 percent for medium farms (32.5 acres) and 56 percent for large farms (50 acres). Under with project conditions, an increase inintensity is assumed as 13 percent for small farms, 10percent for medium farms and 6 percent for large farms, resulting in 10% on an overall basis. EconomicAnalysis MethodologyandAssumptions. The economic value ofproject benefits hasbeencalculatedby estimating incremental outputs and inputsat parity prices. For non-traded commodities economic prices have been calculated by applying a standardconversion factor (SCF) of 0.9. Economic project cost have been calculatedby applyingthe SCF and excluding taxes and duties. Cost o f all project componentshas been takeninto account. Economic price derivations are includedinTable 4.2. The projectlife is assumedto be 20 years. - 74 - Economic Rate of Return The project's economic rate o f return (ERR) is estimated as 20.8% (or 21%), and financial rate o freturn (FRR) at 18.7% (or 19%). Details are includedinTable 4.3. Sensitivity analysis/ Switchingvalues of critical items: The project ERRis robust andnot very sensitive to variations inthe project costs or benefits. Switching values have been computed to determine the effects o f increase incosts anddecrease inbenefits. The analysis shows that the ERRis more sensitive to reduction inbenefits than increase incosts. The results indicate that the ERRfor the project would fall to 10 percent ifthe cost increasedby more than 85 percent or the benefits decreasedby more than 46 percent as summarized below: SwitchingValues (Rs. Million) Total Costs Total Benefits Description Base Value Switching YO Base Value Switching Yo Value Increase Value Decrease Overall Project 3,127 5,788 85.0 5,788 3,127 46.0 The impact o f cost over runs and reduction inbenefits is summarized below. Scenario Overall Project Base Case 20.8% IncrementalBenefits lag by two Years 14.8% 10%cost overrun 16.8% 20% cost overrun 13.2% 20% reduction inincrementalbenefits 16.4% 10% increase incosts and 20% decrease inbenefits 12.5% 20% increase incosts and 20% decrease inbenefits 11.1% The above results show that the ERRremains satisfactory, even ifthe costs increase by 20 percent and benefits decrease by 20 percent. - 75 - Table 4.1 :PricesUsedinFinancialand EconomicAnalysis (Farm-gate PricesJune 2003 PriceLevel) IDescription unit Financial Economic AOutputs KharifCrops Cotton Rslkg 17.50 13.49 Rice Rsikg 7.25 4.76 Sugarcane Rsikg 1.05 1.29 KFodders Rslkg 0.82 0.74 K Vegetables Rslkg 3.50 3.15 KOrchards Rsikg 5.50 4.95 RabiCrops Wheat Rsikg 7.13 8.32 R Fodder Rskg 0.55 0.50 R Vegetables Rslkg 3.00 2.70 R Orchards Rskg 5.40 4.86 2 By-products Cotton Rslkg 0.72 0.65 Rice Rsikg 0.83 0.75 Wheat Rsikg 1.33 1.20 B.Inputs 3 Seed Cotton Rsikg 75.56 68.00 Rice Rsikg 16.67 15.00 Sugarcane Rsikg 2.10 1.89 KFodders Rsikg 22.22 20.00 KVegetables Rsikg 36.00 32.40 Wheat Rsikg 10.51 9.46 R Fodder Rsikg 68.00 68.00 R Vegetables Rslkg 25.00 22.50 Orchards RsiPlant 25.00 22.50 4 Fertilizers Nitrogen (N) RsJNkg 19.48 21.94 Phosphorus(P) RsMkg 31.74 29.52 Potash(K) RsMkg 18.67 19.89 FarmYardManure 1000 Kg 300.00 270.00 - 76 - Table 4.1 continued: 5 Pesticides Cotton RslSpray 600 540 Rice RslSpray 500 450 Sugarcane RslSpray 300 270 Wheat RslSpray 300 270 Orchards RslSpray 600 540 Vegetables RslSpray 300 270 6Bullock Labor RslPlough 130 117 7Tractor Labor RslHour 200 180 8 ManualLabor Rs/Day 80 72 9PurchasedGroundwater RslHour 80 80 10CanalWater Rates(abiana) Cotton RslAcre 93.09 93.09 Rice RslAcre 88.78 88.78 Sugarcane RslAcre 181.87 181.87 KFodders RslAcre 53.30 53.30 KVegetables RslAcre 142.14 142.14 Wheat RslAcre 53.30 53.30 RFodder RslAcre 53.30 53.30 R Vegetables RdAcre 130.00 130.00 Orchards RslAcre 165.00 165.00 - 77 - Pakistan Sindh On-FarmWater ManagementProject Table 4.2 :Derivation of Parity Prices ParityPriceBasis(1) (E) (1) (1) (1) (1) Wheat Wheat Sugarcane DAP(4) TSP(5) ProjectedPrice inCurrentDollars $/mt (2) 180.0 180.0 150.0 1,102 210.0 108.6 168.0 140 MW Factors% * 99.33 99.33 99.33 99.33 99.33 99.33 99.33 99.33 InConstant2003 Dollars 178.8 178.8 149.0 1,094.6 208.6 107.9 166.9 139.1 Quality Adjustment Factor 0.85 0.85 0.97 0.97 0.97 1.00 1.00 1.00 World Market Equivalent $/mt 152.0 152.0 144.5 1,061.8 202.3 107.9 166.9 139.1 Transport andInsurance 47 47 47 235 47 47 47 47 cif, Karachi 105 199 192 827 155 155 214 186 ExchangeRate RslzTS$ 58 58 58 58 58 58 58 58 cif, Karachi (Rs/t) 6,089 11,541 11,108 47,953 9,009 8,983 12,405 10,792 Portcharges 312 312 312 1,560 312 312 312 312 Storage andhandling 494 494 494 2,470 494 494 494 494 Value at Karachi market 5,283 12,347 11,914 43,923 8,203 9,789 13,211 11,598 Transport to Project Area (Mill) 104 104 104 624 104 104 104 104 ProcessedValue 5,179 12,451 12,018 43,299 8,099 9,893 13,315 11,702 ProcessingRatio % 93.6 93.6 8.5 33 62 100 100 100 ProcessingCharges 259 259 2,700 1,587 302 WholesaleValue 4,604 11,896 1,251 13,765 4,834 9,893 13,315 11,702 Localagent's commission 92 238 38 275 97 198 266 234 Value at farm-gate 4,512 12,134 1,289 13,490 4,737 10,090 13,581 11,936 EconomicValue at farm-gate(Rsi4Okg) 180 485 52 540 189 Fertilizer: EconomicValue of 50kg bag 505 679 597 Fertilizer: Financial Priceof 50kgbag 448 730 560 Localfarm-gate price (Rd4Okg) 285 285 42 700 290 Ratio ofborderto local farm-gateprice 0.63 1.70 1.23 0.71 0.65 FinancialPriceper Kg 7.13 7.13 1.05 17.50 7.25 EconomicPriceper Kg 4.51 12.13 1.29 13.49 4.74 Averageof Import + Export Parity Price 8.32 Value of NinCase ofFertilizers Fin 19.5 31.7 18.7 Eco 21.9 29.5 19.9 (1) Parity : [I]Import [E] Export (2) Tabel A2.13 Commodity prices andprice projections incurrent dollars Prospects - 2003 - Global Economic World Bank (3) 46% nitrogen (4) 18%nitrogen and46% phosphorous(5) 60% potassium - 78 - Pakistan Sindh On-Farm Water Management Project Table 4.3 :Financial and Economic Analysis A. Financial Analysis B.Economic Analysis Investment Incremental Total Incremental Net Investment Incremental Total Incremental Net Costs O&M Costs Agriculture Incremental Costs O&M Costs Agriculture Incremental Benefits Benefits Benefits Benefits Year-1 696.72 (39.33) 657.39 (657.39) 605.20 (35.39) 569.81 (569.8 1) Year-2 1,170.47 (104.78) 1,065.68 84.59 (981.10) 1,048.16 (94.30) 953.85 85.79 (868.07) Year-3 1,296.02 (178.69) 1,117.33 172.12 (945.21) 1,171.97 (160.82) l,o 11.15 174.42 (836.73) Year-4 1,341.95 (255.81) 1,086.14 261.94 (824.20) 1,214.74 (230.23) 984.51 265.42 (719.10) Year-5 (255.81) (255.81) 354.10 609.91 (230.23) (230.23) 358.82 589.05 Year-6 (255.81) (255.81) 449.47 705.28 (230.23) (230.23) 454.71 684.94 Year-7 (255.81) (255.81) 546.11 801.91 (230.23) (230.23) 553.13 783.36 Year-8 (255.81) (255.81) 645.26 901.07 (230.23) (230.23) 654.16 884.39 Year-9 (255.81) (255.81) 746.97 1,002.78 (230.23) (230.23) 790.58 1,020.81 Year-10 (255.81) (255.81) 806.57 1,062.37 (230.23) (230.23) 864.94 1,095.17 Year-11 (255.81) (255.81) 806.57 1,062.37 (230.23) (230.23) 864.94 1,095.17 Year-12 (255.81) (255.81) 806.57 1,062.37 (230.23) (230.23) 864.94 1,095.17 Year-13 (255.81) (255.81) 806.57 1,062.37 (230.23) (230.23) 864.94 1,095.17 Year-14 (255.81) (255.81) 806.57 1,062.37 (230.23) (230.23) 864.94 1,095.17 Year-15 (255.81) (255.81) 806.57 1,062.37 (230.23) (230.23) 864.94 1,095.17 Year- 16 (255.81) (255.81) 806.57 1,062.37 (230.23) (230.23) 864.94 1,095.17 Year-17 (255.81) (255.81) 806.57 1,062.37 (230.23) (230.23) 864.94 1,095.17 Year-18 (255.8 1) (255.81) 806.57 1,062.37 (230.23) (230.23) 864.94 1,095.17 Year-19 (255.81) (255.81) 806.57 1,062.37 (230.23) (230.23) 864.94 1,095.17 Year-20 (255.81) (255.81) 806.57 1,062.37 (230.23) (230.23) 864.94 1,095. I7 ERR= 18.7% ERR= 20.8% - 79 - Annex 5: Financial Summary PAKISTAN:Sindh On-Farm Water Management Project US$ Million Year4 Year-2 Year-3 Year4 Total Total Financing Required Project Costs Investment Costs 10.236 18.068 20.896 22.328 71.528 Recurrent Costs 2.163 3.445 3.705 3.930 13.242 Total ProjectCosts 12.399 21.513 24.601 26.258 84.770 Total Financing 12.399 21.513 24.601 26.258 84.770 Financing IBRDllDA 9.313 15.754 17.421 18.656 61.I44 Government 1.119 1.590 1.627 1.787 6.124 Central Provincial Co-financiers User FeeslBeneficiaries 1.967 4.169 5.552 5.815 17.502 Others Total Project Financing 12.399 21.513 24.601 26.258 84.770 The Projectwill be implementedduringFY05-FY08 - 80 - Annex 6(A): Procurement Arrangements PAKISTAN: Sindh On-FarmWater Management Project Procurement ProcurementCapacity An assessment o fthe ImplementingAgencies' procurement capacity was carried out by a Procurement Accredited Staff (PAS). The main findings were as follows: Organization The Agriculture Department (DGAEWM, Director OFWM, DGAER), SIDA, AWBs and FOs will be responsible andaccountable for implementing project components, including carrying out procurement, within each agency's respective jurisdction. The Agriculture Department and SIDA have been involved inpast Bank financed projects, such as the ThirdOn-Farm Water Management Project, (Cr. 2245-PAK) and the National Drainage ProgramProject (Cr. 2999-PAK). Key staff members have also attended basic procurement training conducted by the Bank. However, the implementing agencies' existing procurement capacity remains generally weak due to various reasons. Contributingfactors include the recent devolution o f the Agriculture Department's organization from the provincial to the local government level. SIDA on the other handis a relatively young andleanorganization with a limited number of staff drawn from the irrigation department andthe private sector. AWBs andFOs are also newly establishedentities that have very little prior experience incarrying out competitive procurement ingeneral, andalmost no exposure to the Bank's procurement procedures. None o f the agencies have staff dedicated exclusively for procurement andthere is a general lack o f expertise inthe Bank's procurement procedures, particularlyprocurement o f goods and consultants' services. The implementing agencies will, therefore, require assistance and additional support for adequately managing procurement under the project. The following capacity strengthening measures have been agreed with the implementing agencies: (a) Procurement support (including preparation o f bidding documents, evaluation o f bids, and contract award procedures) will be providedto all implementing agencies by the Project Implementation Assistance (PIA) Consultants that are being engaged under the project. (b) Each ImplementingAgency will assign at least one qualified staff member dedicated exclusively to procurement work under the Project. (c) Each ImplementingAgency will nominate a focal point for interaction with the Bank on their respective project procurement matters. (d) The Bank will assist incapacity buildingby conducting procurement training workshops for key procurement staff o f the ImplementingAgencies, before the start and during implementation o f the project, inorder to improve andupdate their knowledge o f the Bank's procurement procedures. Procurement Procedures The existing procurement procedures o f the implementing agencies' were reviewedandfound to be -81 - broadly basedon competitive methodsofprocurement,with systems for intemal reviewlclearances. It was notedthat some differencesexist betweenthe procurementprocedures of these agencies and the Bank, such as inthe use o fpre-qualificatiordpost qualificationprocedures, the Bank's open eligibility requirementsvs the govemment's practice o f enlisting/pre-registeringbidders, which the Bankfinds restrictive, andthe practiceofnegotiationswith bidders. These differences willbe removedthrough application ofthe Bank's ProcurementGuidelines which will govem all procurement of Goods and Works to be financed under the Project. Consultants' services will be procured inaccordancewith the Bank's Consultant Guidelines. The specific procurement arrangements describedbelow are designedto ensure conformity with the Bank'sprocurement procedures. ProcurementMethods Goods and Works to be financed underthe project shall beprocured inaccordancewith the Guidelines for ProcurementunderIBRDLoans and IDA Credits, January 1995, revisedJanuary 1999. Consultants Services financed underthe project shall be procured inaccordance with the Bank's Guidelines for SelectionandEmployment of ConsultantsbyWorld BankBorrowers, January 1997, revisedMay 2002. The Bank's standardbiddingdocuments for procurement under IntemationalCompetitive Bidding(ICB), andsample biddingdocuments for procurement under National Competitive Bidding(NCB) which are already beingused on other Bank financed projects inPakistan,willbeusedfor procurementofGoodsandWorksundertheproject. Themodelform o f community construction agreement that has been developed, with the Bank's concurrence, under the NDP project will be usedfor the works to be carried out through community participationunder the Project. The Bank's StandardRequestfor Proposal document will be used inthe selection o f Consulting f m s . All expectedprocurement ofgoods, works andconsultants' serviceswillbelistedinthe project's General ProcurementNotice (GPN). The GPNhas already beenpublished inthe UnitedNations Development Business (UNDB) andwill be updatedannually. Civil Works Civil works generally comprise: (i) Watercourseimprovementandconstructionofwaterstoragetanks- Approximately4000 watercourses and 200 water storagetanks are expected to be constructed at different locations over the life ofthe project. The cost of eachschemewill bevery small rangingbetween US$2,000 to US$13,000. (ii) Distributary and Minor Canals improvement. About 100 distributaries/minor canals are expectedto be constructedunder the project. The costs o f these schemes are estimated to range between US$20,000 and US$160,000. (iii) Branch canals improvement. About 25 branchcanals will be rehabilitatedimproved under the project. These schemes are ofrelatively higher value but their costs are still not expectedto exceedUS$200,000 each. Due to the relatively small value and dispersednature o fthe civil works under the project, foreign biddersare not expectedto be attractedandICB will not be appropriate. Civil works estimatedto - 82 - cost more than $30,000 per contract shall beprocured through NationalCompetitive Bidding (NCB) procedures acceptableto the Bank. However, ifforeign firms wish to participate inthese contracts, they will be permitted. Civil works estimatedto cost less than $30,000 per contract may be procuredthrough community participation, under lump-sumoutput/deliverable basedcontracts, awarded directly to the concernedWCAs and FO. Goods International Competitive Bidding(ICB) procedures shall be followed for each Goods contract estimated to cost more than US$200,000 equivalent. Domestic Preferencewill be allowedto local manufacturers on ICB contracts. Goods estimatedto cost betweenUS$25,000 equivalent and US$200,000 per contract up to an aggregateamount of US$900,000 may be procuredthrough National Competitive Bidding(NCB) proceduresacceptableto the Bank. Small value off-the-shelf goods estimated to cost US$25,000 equivalent or less per contract up to an aggregate amount of US$600,000 would be procured following NationaMnternational Shopping proceduresin accordancewith the Procurement Guidelines. ImprovementofBiddingProcedures underNationalCompetitiveBidding The following improvements inbiddingprocedureswill apply to all procurement of Goods and Works under National Competitive Bidding, inorder to ensure economy, efficiency, transparency andbroadconsistencywith the provisions of Section 1ofthe Guidelines: 0 Invitation to bidshall be advertisedinat least one nationalnewspaperwith a wide circulation, at least 30 days prior to the deadline for the submission of bids; 0 biddocumentsshall be madeavailable, bymail or inperson, to all who are willing to pay the requiredfee; 0 foreign bidders shall not be precluded from bidding andno preferenceo f any kindshall be given to national bidders inthe biddingprocess; 0 biddingshall not be restrictedto pre-registeredfirms; 0 qualification criteria shall be statedinthe biddingdocuments; 0 bids shall be openedinpublic, immediately after the deadline for submission ofbids; 0 bids shall not be rejectedmerely onthe basis ofa comparison with an officialestimate without the prior concurrence of the Association; 0 before rejecting all bids and soliciting new bids, the Association's prior concurrenceshall be obtained; 0 bids shall be solicited andcontracts shall be awardedon the basisofunitprices andnot on the basis o f a composite scheduleof rates; 0 contracts shall not be awarded on the basis o fnationally negotiated rates; 0 contracts shall be awarded to the lowest evaluatedand qualifiedbidder; and 0 post-bidding negotiations shall not be allowed with the lowest evaluated or any other bidders. Consultants' Services Contracts with consulting f m s estimatedto cost more than $100,000 per contract will be procured inaccordancewith Quality andCost Based(QCBS) Selectionprocedures. Contracts estimatedto cost less than $100,000 per contract may be procured through the methodo f Selection Basedon - 83 - Consultants' Qualifications. For contractswith consulting f m s estimatedto cost less than $500,000 equivalent per contract, the shortlist ofconsultantsmay comprise entirelynational consultants inaccordance with the provisions o fparagraph2.7 and footnote 8 o f the Consultant Guidelines. Contractswith individual consultants will be procured inaccordancewith the provisions o f paragraphs5.1 to 5.4 inSection V o f the Consultants Guidelines. ProcurementPlanning The Procurement Planfor the key contractsfor goods, works andconsultants' services expected under the Project have beenprovided to the Bank andare available inBankfiles andthe PIP. Procurement under the project will be carried out inaccordancewith this procurement plan. Procurement planswill be closely monitored and updated on a quarterly basis. Review of Procurementby the Bank(see Table B) Prior Review: The first NCB contract for Goods, irrespective of value, awardedby each implementing agency and thereafter each contract for Goods estimatedto cost US$200,000 equivalent or more. The first NCB contract for works, irrespective o fvalue, awardedby each implementing agency, andthereaftereach contract for Works estimated to cost US$200,000 equivalent or more. The first Consultants' Services contract with consulting f m s , irrespective o fvalue, awarded by eachimplementingagency, the first consulting services contract with individual consultants, irrespective of value, awardedby each implementing agency and thereafter all contracts with f m s estimatedto cost US$lOO,OOO equivalent or more, andwith individuals estimated to cost US$ 50,000 equivalent or more. All other contractswill be subject to Post-Review by the Bank. Eachimplementingagency will sendto the Bankon a quarterly basis, a list of all contracts subject to post-review. ProcurementInformationandDocumentation Procurementinformationwill be recordedandreported as follows by each implementingagency: (a) Complete procurement documentation for eachcontract, including biddingdocuments, advertisements,bids received, bidevaluations, letters of acceptance, contract agreements, securities, relatedcorrespondenceetc., will be maintained inan orderly manner so as to be readily available for audit. (b) Contract awardinformation will bepromptly recordedandcontract rostersmaintained inthe Bank's sample format. (c) Comprehensivequarterlyreports indicating: (i)revisedcostestimates,whereapplicable,foreachcontract; (ii)statusofon-goingprocurement,includingacomparisonoforiginallyplannedandactual dates o f the procurement actions, includingpreparation of biddingdocuments, advertising, bidding, evaluation, contract award andcompletiontime for eachcontract; and (iii) procurementplans,includingreviseddates,whereapplicable,fortheprocurement updated actions. - 84 - Procurementmethods (Table A) Table A: ProjectCosts by ProcurementArrangements (US$ million equivalent) 1. Works 0.00 8.90 53.60 0.00 62.50 (0.00) (8.01) (33.11) (0.00) (41.12) 2. Goods 3.75 0.86 0.51 0.00 5.12 (2.62) (0.68) (0.37) (0.00) (3.67) 3. Services 0.00 0.00 2.87 0.00 2.87 (0.00) (0.00) (2.78) (0.00) (2.78) 4. Miscellaneous 0.00 0.00 14.28 0.00 14.28 Training, incremental (0.00) (0.00) (13.57) (0.00) (13.57) administrativeand operating costs Total 3.75 9.76 71.26 0.00 84.77 (2.62) (8.69) (49.83) (0.00) (61.14) - a5 - Table A I: Consultant Selection Arrangements (optional) (US$ million equivalent) I\Including contingencies Note:QCBS = Quality- and Cost-BasedSelection QBS = Quality-based Selection SFB = Selection under a Fixed Budget LCS = Least-CostSelection CQ = SelectionBasedon Consultants' Qualifications Other = Selectionof individual consultants (per SectionV of ConsultantsGuidelines), Commercial Practices, etc. N.B.F. = Not Bank-financed Figures in parenthesesare the amounts to be financed by the Bank Credit. Prior reviewthresholds (Table B) Table B: Thresholds for Procurement Methods and Prior Review' Contract Value Contracts Subject to Threshold Procurement Prior Review Expenditure Category (USSthousands) Method (US$ millions) 1. Works >200,000 NCB All 30,000 200,000 - NCB Firstcontract <30,000 Community Participation None 2. Goods >200,000 ICB All 25,000 200,000 - NCB Firstcontract <25,000 Isms None 3. Services Consulting Firms >100,000 QCBS All <100,000 SBCQ First Contract IndividualConsultants >50,000 Section V CG - All <50,000 SectionV - CG FirstContract 4. Miscellaneous 5. Miscellaneous 6. Miscellaneous Total value of contracts subject to prior review: US$ 7.5 Millionequivalent Overall Procurement Risk Assessment: High Frequencyof procurementsupervision missionsproposed: One every 6 months (includes special procurement supervision for post-review/audits) "Thresholds generally differ by country andproject. Consult "AssessmentofAgency's Capacityto Implement Procurement"and contact the RegionalProcurement Adviser for guidance. - 87 - Annex 6(B): Financial Managementand DisbursementArrangements PAKISTAN:Sindh On-FarmWater ManagementProject FinancialManagement 1. Summaryofthe FinancialManagementAssessment 1.OverallSummary Financial management arrangements for the Project are acceptable. The following action plan was completed by the project implementing agencies. Based on the experiences o f similar 'On Farm Water Management'projects, the riskratingo f this project is assessed as 'Medium'. Action Plan(completed) No. I Agreed Action Responsibility ICompletionDate 1. I Recruitment o f qualified IIDGAEWM, IFMStaffto be inpositionby project startup. incremental FMStaff (see staffing MD SIDA, . . . (Shortlisting o f candidatesis inprogress). above) CFC 2. FMManualto be revisedby CFC, CFC MD SIDA ManualRevised :31Oct. 2003 (completed) reviewed by Bank, and approvedby BankReview: 15Nov. 2003 (completed) AG Sindh AG's commentsreceivedandincorporatedin the FMManual. 3. SIDA Audited Accounts: 0FY2002 MD,CFC 0 31 Oct. 2003 (received) 0FY 2003 0 30 Nov. 2003 (received) 4. Obtain Permission from AG DGAgricultural Action completed- Imprest account established. Sindh to Open Imprest Bank Extension 2. Country / ProvincialIssues Draft Sindh ProvincialFinancial Accountability Assessment recognizesthe issue that there are inadequate mechanisms for accounting and reconciliations of project accounts with those o f SBP and Economic Affairs Division. The Accountant General records only that part of expenditure which i s directly incurred from the provincial budget mostly in the form of counterpart contribution. The entire liability o f such loans is affixed to the provincial / federal government without any disclosure in the annual finance accounts. Efforts are made to add to the Government chart o f accounts which can enable provision of periodical reports requiredby the Bank. The Draft Sin& PFAA and CFAA recognize that the intemal audit is dormant inthe government agencies. Therefore, establishment o f an intemal audit function for the project as an integral component o f good financial governance is proposed. The detailed rationale is given under the heading "Auditing Arrangements". The Government o f Sindh should ensure that intemal auditing becomes institutionalized intheDGAEWMevenafter the projectisclosed. 3. Strengths& Weaknesses Most of the implementing agencies have prior experience o f managing Bank-fundedprojects and therefore have devised the FM concept / design for the project which is quite comprehensive. The detailed procedures to be implemented through professional staff would ensure sound financial controls and submission o f financial statements on timely basis. SIDA is a critical agency from the project standpoint and for the implementation o f spirit o f Sindh Water Management Ordinance, 2002. The GM (Finance) - 88 - being a senior FCMA has initiated the FM reforms in the organization, the benefits o f which will be impartedto this project. As the ChiefFinancial Coordinator (CFC) of this project, the project would avail itself o f goodprofessional accountancy support for enrichment of the designedaccountability framework. 4. ImplementingEntities P&D Department of GOSindh would be the overseer of the project operating through the PSC. Under the supervision o f the PSC, the lead implementingagency will be Director General Agncultural Engineering & Water Management (DGAEWM), Department of Agriculture ofthe GOSindh. The Director On-Farm Water Management will actively take part through the field teams. Other major implementation agency would be Sindh Irrigation & Drainage Authority (SIDA). Director General Agricultural Extension will also be involved inthe productivity enhancement andpest managementcomponento fthe project. The project also envisages the execution through newly formed WCAs and FOs - the participating agencies. These institutions have little experience,particularly infinancial management. FOs have a legal status o f corporate bodies underthe Sindh Water Management Ordinance, 2002 and are requiredunder the Ordinance to produce their own accounts for audit. The implementing agencies would be entering into out-put based contracts with these organizations; therefore the internal financial management of these organizations is not o f direct concern. However, the financial management capacity inthese organizations i s crucial for their sustainability and implementation o f the spirit o f decentralized, participative and sustaining irrigationmanagement. The design of the arrangementsfor capacity buildingof the WCAs and FOs in accounting and financial management to be carried out by FM Support Teams as part o f the project is two-fold. First it would attempt to develop policies andprocedures for FM activities inthe FOs and WCAs and roll out of these through orientation trainings. Second, and as a consequence o f the former, the establishment of FM Support Teams for rendering related services to FOs and WCAs for the four-year project term would strengthen their capacity to become more financially independent and properly accountable to their members. The concept o f the support teams has been designed keeping in view the existing low level of expertise inthe area o f financial management, the unsatisfactory results of short-term training programs and the degree to which the sustainability o f these institutions depend upon their FM expertise. The financial management support to be provided under the project for these organizations under the 'social mobilization and capacity buildingcomponent' is a relevant extra to build up on their own internal mechanismsas organizations independentofthe core institutions (DGAEWMand SIDA) managing the project. It has to be stressed however that the fiduciary risk o f the project has nothing to do with the existing internal accountability framework in FOs and WCAs. This is essentially because these institutions, under the auspices of the out-put based arrangements, will serve merely as "contractors". Their individual accounting processes and financial management requisites, therefore, fall outside the strict scope o f the assessment criteria for the determination o f areas of fiduciary risk for the project. As a prerequisite of accessing financial resources from the project, however, these institutions must be registered as distinct bodies with which output-based contracts will be signed and for which training inFMshall be given. 5. FundsFlow The project will be budgeted in the Annual Development Plan o f the Government o f Sindh as an identifiable single headbudget itemeach year showing both the local andforeign resources o f funding ina lump-summanner. The following flowchart shows the flow o f funds from the Government and Bank to the two major implementation entities and within the project to the various agencies and the corresponding accounting information flow for the purposes of project accounting and consolidated financial reporting. It does not, however, show the internal flow of funds to the participating agencies through the mechanism of imprest - 89 - accounts but these issueshave been detailed inthe design o f the detailed operational arrangements with the implementing agencies as relating to the payment of miscellaneous and emergency expenditures at the diverse project sites: c Periodical ,/) Funds c - - - Disbursementof Implementation /-Funds andFinancial Partners ,/--" Management I l-My E- I *** The GeneralManager (Finance) of SIDA will be the Chief FinancialCoordinator (CFC) *** InternalAuditor will be housedat the DGAEWMbut reportto the Project Coordinator FMSupportTeams will work under the supervision of a Senior FinanceProfessionalwho shall reportto the CFC 6. Staffing Both the implementing agencies have acute shortage o f FM skilled staff. In accordance with the FM concept Paper proposal andbased on the requirements as identified during appraisal, hiringo f incremental professional staff for DGAEWM and SIDA, specifically, is supported in order to instill improved financial management and control for this specific project. The FM assessment supports hiring of - 90 - incremental staff to the extent DGAEWM: (5) - - One adequately qualified and experienced, One partly qualified Accountant and Three Assistants; SIDA: (3) - One qualified and experienced Accountant, One partlyqualified andOne Assistant. The ChiefFinancial Coordinator (CFC) nominated to serve the project i s already inposition with SIDA and funded under the NDP project. Since the NDP project will close in December 2004, the Sindh On FarmWater Management Project shall take over the retention costs of the CFC. To buildFMcapacity at participating agencies (FOs and AWBs), the project shall incur incremental costs for this activity. For this, FM Support Teams shall be established. These FM Support Teams (6 distinct teams) will be supervised by an adequately qualified and experienced accountant housed in DGAEWM but report, through this qualified accountant, to the CFC ofthe Project. The Teams will initially organize financial accounting and reporting induction workshops and training for groups o f FO and WCA organizations, and thereafter visit each FO and related WCA at least once every six to eight weeks in a year to provide the necessary support by mainly compiling the raw data into presentable shape and giving guidance in book-keeping and reporting. The idea is to build up FM capacity gradually over time and initially let them concentrate on the core expertise relating to the operation & maintenance of watercourses and channels inan organizational framework. Each support team will have one leadAccountant and one Assistant preferably recruited from withinthe project area. The team will be givena motor cycle so as to render services at the doorstepsof the beneficiary institutions. Again, it is reiteratedherethat FMsupport to these organizations is a stand-alone FM capacity buildingactivity for project contractor-type agencies under the output-based arrangement to be put in place, and does not therefore impact on the FM deliverable for safeguardingBank funds. 7. AccountingPolicies& Procedures The implementing agencies have different legal structures and, therefore, their applicable rules and procedures also differ. DGAEWM follows the provincial regulations including Government Financial Regulations (GFR), Account Codes, and Budget Manual. SIDA has its own Financial Regulations & Powers, 2002. This necessitatedthe need for an FMManual for the project, which has beenprepared by the GM (Finance), SIDA, the CFC o fthe project and clearedby the Accountant General Sindh. The funds once receivedby the provincial governmentwill be budgetedon the basis ofthe NAMChart of Accounts. The project implementingagencies shall each submit monthlv civil accounts to the Accountant General of Sindh o f all expenditures from the Assignment and Special Accounts in accordance with the detailed functional and object classifications of the new COA in order for the project expenditures to be captured inthe aggregate GOSindh accounts. As a by-product o f this, FMRs requiredfor reporting to the Bank should also be provided on a quarterly basis. The fact that incremental professional staff will be hired for project financial management will ensure the accuracy and timeliness of reporting to both the Bankandthe Government. To avert any possibility of accruing reconciliation problems, the Project Implementing Agencies shall individually carry out monthly reconciliations of disbursements as per monthly government accounts and quarterly FMRs with the funds transferred to the Special Accounts held with the NBP to agree the balances inthe assignment and special accountsat each reporting period. They will provide a copy of the reconciled monthly civil accounts submitted to the AG together with the quarterly FMRs (per implementing agency and consolidated) to the Bankwithin 4 weeks o f the end o f each quarter. Recognizing the fact that the government accountsare maintained on cashbasis which i s no different from the Bank's requirements, the project accounts shall be maintained on a cash basis. However, for purposes of additional comprehensiveness, `notes' to the quarterly and annual financial reporting to the Bank should - 91 - adequately disclose the commitments and obligations outstanding at that date. From the developmental perspective as well as for capturing total project costs, the FMRs will include accounting o f notional contributions by the beneficiaries' organizations under the out-put based agreements inproportion to the works completed. An important issue that needed resolution was the manner inwhich the salaries and related remuneration will be paidout to the project incremental fieldstaff operating inthe districts. Since these staff will not be on the Government o f Sindh civil service payroll, the following procedure for payment o f their salariesand the accounting thereof shall be observed: The DGAEWM will, by the 20th day o f each month, send a detailed listing o f incremental staff assignedto each district together with the amount o f salary payable to each staff, to the Accountant General of Sindh. This will constitute a Payment Request, and will be accompanied by a check for the whole amount, drawn from the Special Account and the Assignment Account as the case may be. The Accountant General shall deposit the check inthe Provincial Account No. 1 under a separate Public Account Head from where the payments to the incremental field staff will be made. The Accountant General will sanction the DAOs ineach district to pay the salarieso fthe named staff during the normal `pay days'. The DAOs will send a retum of the consolidated list o f actualized payments to the Accountant General immediately after the payments are made. The Accountant General shall then supply to the DGAEWM actual details o fpayments made for each month" 8. MonitoringandReporting Since many participating agencies would take part in the project activities but only two agencies will be operating the special accounts, andthus provide quarterly Financial Monitoring Reports (FMRs), there is an unavoidable need for a consolidation workbench. This would be achieved by designating the GM (Finance) SIDA, as the CFC o f the overall project to receive monthly as well as copies o f quarterly FMRs from each implementing agency and providing a consolidation thereof for submission to the Bank. He (the CFC) will reconcile and consolidate the information and submit the reconciled and consolidated statement(s) to the Bank within 5 weeks after the end o f the quarter. By this means, the intemal controls at the level of the core project implementingagencieswould be better assured. 9. InformationSystem With the recruitment of adequately qualified staff, and based on the need to use the core government accounting classification for reporting consistent with the new requirements under item 4 (Funds Flow) above, a combination o f manual and spread sheet based financial accounting system shall be set up to allow for delivery o f accurate and reliable financial reports to both the Government and the Bank. The Bank'sreporting requirements shall be a by-product ofthe government accounting system. The Financial Information System (FIS) shall also be implemented to produce monthly, quarterly and annual reports which will include, but not limited to, the periodic financial statements, sources and application of funds, budget versus actual expenses, financial versus physical progress. 10. SupervisionPlan With the implementation of sound financial management andmonitoring systemby a cadre of professional staff proposed for the project, Bank's normal supervision procedures will suffice. Closer supervision would, however, be required initially to ensure compliance with the proposed systems and staffing improvemend enhancement as outlined. 2. Audit Arrangements 1.InternalAudit None o f the two core project implementing agencies has any effective intemal audt framework in - 92 - place. DGAEWM is a Government Department, whereas SIDA is an autonomous body, thus making the project structure even more complex. An intemal audit unit shall, therefore, be established to service the project entities. This intemal auditing initiative will serve as a catalyst for establishing sustainable internal audit units in each o f the project implementation agencies and departments and hence, reinforce accountability. A staff o f three auditors (a senior auditor supported by two junior auditors) has been proposed. Internal audit must be seen as an activity for continuous improvement and performance appraisal. It will also complement the work o f the M&E consultants. The intemal auditor will report to the Project Coordinator, who shall take necessary action on the recommendations. The reports o f the intemal audit shall be copied to the PSC, MD SIDA, DGAEWMand CFC for enhanced operational transparency. 2. ExternalAudit The extemal audit of all implementing agencies shall be done by the Auditor-General's Department in as far as the civil accounts are concemed. Also, extemal audits o f the implementing agencies' project accounts shall be carried out by the Auditor General's Department. These project audits are expected to be timely. Specific requirements o f the Bank inrespect o f these project audits will be conveyed to the implementing agencies, and will include the auditors' expressing o f opinions on the consolidated reports o f the implementing agencies which would have been separately audited as subsets o f the overall project accounts. SIDA and AWBs are also required under the law to be audited by a firm o f Chartered Accountants. These audits have historically been long delayed. Recently the audits o f SIDA accounts for the years ended June 30, 1998 to 2003 were received after delays. Due to the recruitment o f a qualified accountant as GM Finance in SIDA, organization's entity audited accounts are now expected to be delivered on time. The Auditor-General has also reserved observations inthe form of audit paras for DGAEWM as far as civil accounts are concemed but these observations were later resolved in the D A C. It may be emphasized that AWBs and FOs are corporate bodies under the law and are therefore required to get their accounts audited by a Chartered Accountant. The project funds will only be disbursed under the output-based agreements to these agencies; therefore submission o f audited accounts to the Bank by these agencies is not mandatory and shall not be required. But as a good practice, these organizations would be encouraged to get their accounts audited. 3. DisbursementArrangements Disbursement would be made using traditional transaction based disbursement procedures. IDA Credit o f US$ 61.14 million would be disbursed over a period o f four years. Allocation o f Credit proceeds by disbursement category andpercentage to be financed are shown inTable C: - 93 - Allocation of credit proceeds(Table C) Table C: Allocation of Credit Proceeds I II Expenditure Category I Amount in USdmillion 1I I Financing Percentage I I I. Works: Civil (i) Improvementof Watercourses (Materials) 27.450 81% (ii) Improvementof Distributaries 6.980 90% (iii) improvement of BranchCanals 3.100 90% 100%of foreign expenditures, 100%of local expenditures(ex-factorycost) and 80% of localexpendituresfor other items 2. Goods: procuredlocally. (i) DGAEWM and DGAER 2.200 (ii) SIDA and AWE 1.310 88% for foreign firms and individualsand 3. Consultants Services: 98% for localfirms and individuals (i) DGAEWM and DGAER I,980 (ii) SIDNAWB 0.590 Use of statements of expenditures (SOEs): The Credit proceedswouldbe lsbursed against certified Statemento fExpenditures for (a) civil works and goods contracts costing less than US$200,000 equivalent, (b) consultants contracts less thanUS$lOO,OOO incase off m s andcontractslessthanUS$50,000 equivalent incase ofindividual consultants; and(c) training; and (d) incremental administrative andoperating costs. All other contracts would be fully documented. Supporting documents would be retained by the project managementandmade available to IDA staffduringsupervision missions. Special account: To facilitate disbursements,two special accounts (one for DGAEWMofthe Government of Sin& andthe other for SIDA) would be openedwith the National Bank of Palustan. All eligible expenditureswouldbe financed through these special accounts. All funds transfer from the World Bank shall, however, be - 94 - channeledthrough the State Bank of Pakistan(SBP) to the nominated Special Accounts establishedwith the NBP. The initial deposit into the specialaccountswould be US$2.5 million for DGAEWMand US$ 1.O millionfor SIDA. Similar correspondingRupeeaccounts will be openedwith the NBP for making disbursements from the Government counterpart funds. Payments for the canal works carried out by the FOs I AWBs, under output basedagreements, wouldbe made by SIDA to the contractors appointedby FOsIAWBs on the basis o f their certificationby the project engineers. Special Accounts will be maintained andoperatedby the two implementingagencies (DGAEWMand SIDA). Each o f these two agencies will separatelysubmit statement of disbursements to the World Bank, with a copy to the CFC, for processingWithdrawal Applications underStatementofExpenditure (SOE) arrangements. Fundsfrom the World Bank will bereleasedagainst Withdrawal Applications accompanied bythe SOEs. Original documentationinsupport ofthe expenditures wouldbe keptinthe two major implementation agencies. The CFC will use the FMRspreparedby the two disbursing entities to prepare a consolidated FMR for the project on a quarterly basis for reporting to the Bank. GOSindh shall make the necessary budget provisions on a timely basis to the assignment accounts intheir budget estimates for the project, and will advance funds through the Treasury releasing quarterly requirements as a minimum. Latest instructions (Dated November 25, 2002) regarding the maintenance and operation of revolving fund accounts opened for IDA, IBRD and ADB credits/ loans would be observedby each ofthe two implementingagencies. Retroactive Financing: Retroactive financing would be providedto cover all eligible expendituresup to an amount o fUS$0.5 millionequivalent, incurred after May 31,2003 andbefore Credit signing. - 95 - Annex 7: Project Processing Schedule PAKISTAN: Sindh On-Farm Water Management Project Project Schedule Planned Actual /Timetaken to prepare the project (months) 9 12 /FirstBank mission (identification) 11I1812002 11/21/2002 w s s i o n departure III 08/25/2003 III 09/29/2003 III Negotiations 10/22/2003 02/16/2004 Planned Date of Effectiveness 05/01/2004 Prepared by: The Department o fAgriculture, Government o f Sindh and Sindh Irrigation andDrainage Authority Preparation assistance: GOSindh's Budget Name Speciality Ahsan AliMasan Masood Mirza Senior Procurement SpecialistKonsultant Riaz Mahmood, Anwar Bhatti Disbursement Analysts FurqanAhmad Saleem Financial Management (Consultant) M.AslamRasheed Water Resources Specialist (Consultant) Altaf Iqbal Agricultural Economist (Consultant) GhulamAli Team Assistant A. Qaiyum Shiekh Pest Management (Consultant) Paul MartinNaqar Zakaria Senior Environmental SpecialistlConsultant Nagaraja Harshadeep Senior Water Resources and Environmental Specialist Walter A. Garvey Senior Water Resources Adviser Lilac Thomas Team Assistant Akhtar Hamid Lead Counsel Tekola Dejene Senior Agricultural Economist Manuel Contijoch Senior Water Resources Specialist Ismaila Ceesay Senior Financial Management Specialist Altaf Ahmed Team Assistant Abdelaziz Lagnaoui Senior Pest Management Specialist Aziz Bouzaher Senior Environmental Economist Qazi Azmat Isa Senior Community Development Specialist ArifYaqub Financial Management Specialist Ali Awais Senior Counsel UsmanQamar Senior Irrigation Specialist (Task Team Leader) - 96 - Annex 8: Documentsin the ProjectFile* PAKISTAN:Sindh On-FarmWater ManagementProject A. Project ImplementationPlan Prepared by the Project implementing agencies on the basis of the Implementation Framework andP A D 6. Bank StaffAssessments Watercourse cost estimates C. Other Integrated Social andEnvironmental Assessment Report Sindh Water Management Ordinance 2002 Sample Irrigation and Drainage Transfer Management Agreement between SIDNAWBs and FOs Sample Output Based Agreement (between WCAs and DGAEWM) for watercourse improvements Sample Agreement (between WCAs andDGAEWM) for Transfer o f LandLeveling Equipment to FOsNVCAs 0 Procurement Plans 0 Financial Management Manual e Manuals for survey anddesign o f Watercourses, Storage Tanks, and landleveling issuedby the GOP MinistryofAgriculture 0 Pest Management Plan *Includingelectronicfiles - 97 - Annex 9: Statementof Loans and Credits PAKISTAN: Sindh On-Farm Water Management Project 03-Feb-2004 Differencebetween expected and actual OriginalAmount in US$ Millions disbursements' Project ID FY Purpose IBRD IDA GEF Cancel. Undisb. Orig Frm Rev'd Po82977 2004 SecondPovertyAlleviation Fund Project 0.00 238.00 0.00 0.00 243.24 0.00 0.00 PO10556 2004 HIGHWAYSREHAB 50.00 150.00 0.00 0.00 210.37 0.00 0.00 PO71454 2003 AJK CommunityInfrastructure8 Sewices 0.00 20.00 0.00 0.00 21.06 4.53 0.00 PO74797 2003 BankingSectorTechnicalAssistance 0.00 26.50 0.00 0.00 27.33 12.88 0.00 PO74856 2003 HIWAIDSPreventionProject 0.00 27.83 0.00 0.00 38.48 5.98 0.00 PO77288 2003 National EducationAssessment System 0.00 3.63 0.00 0.00 3.86 0.05 0.00 PO81909 2003 Partnershipfor Polio Eradication 0.00 20.00 0.00 0.00 0.90 -1.89 0.00 P055292 2002 BSRPP 0.00 300.00 0.00 0.00 111.37 -204.62 0.00 PO71092 2001 NWFP ON-FARMWATER MANAGEMENTPROJECT 0.00 21.35 0.00 0.00 22.35 -1.97 0.00 PO56213 2001 TRADE8 TRANSPORT 0.00 3.00 0.00 0.00 0.95 0.53 0.00 P035823 2001 GEF-ProtectedAreas ManagementProject 0.00 0.00 10.08 0.00 11.12 0.94 0.00 PO49791 1999 POVERTYALLEVIATIONFUND 0.00 90.00 0.00 0.00 18.99 -17.72 0.00 PO10500 1998 NATIONALDRAINAGEPR 0.00 285.00 0.00 0.24 88.99 89.43 25.70 PO36015 1997 IMPR FINREP 8 AUDiT - 0.00 28.80 0.00 0.00 15.45 15.45 8.90 ~ Total: 50.00 1214.11 10.08 0.24 814.46 -96.40 34.60 - 98 - PAKISTAN STATEMENT OF IFC's HeldandDisbursedPortfolio June 30 - 2003 InMillions US Dollars Committed Disbursed IFC FY Approval Company Loan Equity Quasi Partic Loan Equity Quasi -Partic 1995 FirstUDL 0.00 0.00 6.67 0.00 0.00 0.00 6.67 0.00 1996 GulAhmed 14.85 4.10 0.00 14.84 14.85 4.10 0.00 14.84 1991/95 IHFL 0.00 0.40 0.00 0.00 0.00 0.40 0.00 0.00 1992196 JSCL 0.00 0.27 0.00 0.00 0.00 0.27 0.00 0.00 2003 KCT 9.25 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1995 Kohinoor 12.50 6.30 0.00 12.20 12.50 6.30 0.00 12.20 2001 LasmoPakistan 30.00 0.00 0.00 0.00 30.00 0.00 0.00 0.00 0194l95197100 MapleLeaf 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2002 Micro Bank 0.00 2.71 0.00 0.00 0.00 2.71 0.00 0.00 1994196 Orix Finance 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1994 Orix Leasing 0.70 0.00 0.00 0.00 0.70 0.00 0.00 0.00 1994 PI&CL 0.31 0.00 0.00 0.00 0.31 0.00 0.00 0.00 1983/84/94/95102 PPL 0.00 6.63 0.00 0.00 0.00 6.63 0.00 0.00 51965/80/82/87/9119419 RegentKnitwear Packages 0.00 0.26 0.00 0.00 0.00 0.26 0.00 0.00 7.86 0.00 0.00 2.80 7.86 0.00 0.00 2.80 1994 Rupafab 0.92 0.00 0.00 0.00 0.92 0.00 0.00 0.00 1995 SarahTextiles 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1993196101 UchPower 32.92 0.00 0.00 61.56 27.95 0.00 0.00 46.52 1996 A E S La1Pir 25.64 9.50 0.00 0.00 25.64 9.50 0.00 0.00 1995 AES Pak Gen 13.46 9.50 0.00 18.78 13.46 9.50 0.00 18.78 1996 AbamcoMgmt 0.00 0.29 0.00 0.00 0.00 0.29 0.00 0.00 1995 Atlas Inv Bank 0.60 0.00 0.00 0.00 0.60 0.00 0.00 0.00 1996 BRRIL 0.00 0.24 0.00 0.00 0.00 0.24 0.00 0.00 0 BRRIM 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1991194195 BSJS Fund 0.00 0.50 0.00 0.00 0.00 0.50 0.00 0.00 1995 CDCPL 0.00 0.16 0.00 0.00 0.00 0.16 0.00 0.00 1993 CrescentBahuman 2.50 0.00 0.00 1.50 2.40 0.00 0.00 1.50 1993197101 DewanSalman 34.00 1.oo 0.00 0.00 30.00 0.00 0.00 0.00 2003 EngroAsahi 5.14 0.00 0.00 0.00 5.14 0.00 0.00 0.00 1998 EngroChemical 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1991195197 EngroVopak 4.68 0.00 0.00 2.32 4.68 0.00 0.00 2.32 1996 FIIB 0.96 0.00 0.00 0.00 0.96 0.00 0.00 0.00 1990192196 FaujiCement 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1993194102 First Leasing 0.00 0.69 0.00 0.00 0.00 0.69 0.00 0.00 1994196 Total Portfolio: 196.29 42.55 6.67 114.00 177.97 41.55 6.67 98.96 Approvals PendingCommitment FY Approval Company Loan Equity Quasi Partic TotalPendingCommitment: 0.00 0.00 0.00 0.00 - 99 - Annex I O : Country at a Glance PAKISTAN:Sindh On-Farm Water Management Project POVERNand SOCIAL South Low- Pakistan Asia income 2002 Population,mid-year(millions) 144.9 1,401 2,495 Lifeexpectancy GNI per capita (Atlas method,US$) 420 460 430 GNI (Atlas method, US5billions) 60.9 640 1,072 Averageannual growth, 1996-02 T Population(%) 2.4 1.8 1.9 Laborforce (%) 3.1 2.3 2.3 SNI Gross 3er primary Most recent estimate (latest yearavailable, 1996-02) :apita enrollment Poverty (% ofpopulationbelownationalpovedvline) 33 Urbanpopulation(% oftotalpopulation) 34 28 30 Life expectancyat birth (years) 64 63 59 L Infantmortality(per 1,000livebirths) 80 71 81 Childmalnutrition(% of childrenunder5) Access to improvedwater source Access to an improvedwater source (% ofpopulation) 90 84 76 Illiteracy(% ofpopulationage 15+) 55 44 37 Gross primary enrollment (% ofschool-agepopulation) 74 97 95 -Pakistan Male 93 108 103 Low-incomeO ~ U D Female 54 89 87 KEY ECONOMICRATIOSand LONG-TERMTRENDS 1982 I992 2001 2002 Economicratios' GDP (US$ billions) 30.7 48.6 58.6 59.1 Gross domestic investmentlGDP 19.3 20.2 15.5 14.7 Exportsof goods and services/GDP 9.9 17.4 18.0 18.7 Trade Gross domestic savingslGDP 7.4 17.1 14.2 14.4 Gross nationalsavingslGDP 14.3 25.5 18.3 22.9 T Current account balance/GDP -3.6 -1.8 -1.9 2.7 Domestic Interestpayments/GDP 0.8 1.4 1.3 1.5 savings Investment Total debtlGDP 38.1 51.2 54.7 59.4 Total debt service/exports 16.2 23.6 25.7 21.4 i Presentvalue of debVGDP 43.5 Presentvalue of debtlexports 221.7 Indebtedness 1982-92 1992-02 2001 2002 2002-06 (average annualgrowth) GDP 6.0 3.3 2.6 2.8 5.3 GDP Der canita 3.3 0.8 0.1 0.4 2.8 Low-incomearouo STRUCTUREof the ECONOMY 1982 1992 2001 2002 Growthof investmentandGDP(%) (% of GDP) .n Agriculture 31.6 26.3 25.3 23.2 l ' " T Industry 22.3 25.0 22.8 23.3 5 Manufacturing 15.1 16.9 15.9 16.1 0 Services 46.2 48.6 51.9 53.5 5 Privateconsumption 82.2 70.0 75.6 74.4 .lo Generalgovernmentconsumption 10.3 12.9 10.2 11.3 I Importsof goods and services 21.8 20.5 19.3 19.0 -GDI *GDP 1982-92 1992-02 2o02 1 (average annualgrowth) Growthof exports and imports(%) I Agriculture 4.5 3.6 -2.8 -0.1 Industry 7.2 3.5 3.8 5.4 Manufacturing 6.9 3.8 8.3 5.0 ' O Services 6.1 4.1 4.1 4.1 Privateconsumption 4.4 4.0 General governmentconsumption 7.8 1.0 Gross domestic investment 4.7 0.6 3.1 -3.0 -Exports +Imports Importsof goods and setvices 2.7 -0.2 -100 - PRICESand GOVERNMENT FINANCE 1982 1992 2001 2002 Domesticprices ("A change) 15 Consumerprices 10.6 4.4 3.5 implicit GDPdeflator 9.4 10.1 6.1 3.1 10 Government finance 5 ,I (% of GDP, includes current grants) Current revenue 19.2 16.2 17.2 97 98 99 00 01 Current budget balance 0.1 -2.7 -2.1 Overall surplus/deflcit -7.5 -5.2 -6.7 "`GDP deflator - 0 I C P I TRADE 1982 1992 2001 2002 (US$millions) Exportand import levels (US$ mill.) Total exports (fob) 2,464 6,762 8,934 9,140 15,000 Cotton 518 139 18 Rice 416 525 448 Manufactures 1,600 3,618 5,820 5,366 Total imports (ci9 8,998 10,202 9,432 Food 978 579 413 Fuel and energy 1,377 3,327 2,664 I Capital goods 2,985 2,687 2,594 Exportprice index (1995-100) 89 82 80 96 97 98 99 00 01 Importpriceindex (1995=100) 95 92 90 Expolts m Imports Terms of trade (1995=100) O2 94 69 89 BALANCEof PAYMENTS 1982 1992 2001 2002 (US$ millions) 1 Currentaccount balanceto GDP (Oh) I Exportsof goods and services 3,055 8,274 10,284 11,056 I Importsof goods and services 6,686 11,468 12,535 11,646 Resourcebalance -3,631 -3,194 -2,251 -590 Net income -321 -1,266 -2,160 -2,319 Net currenttransfers 2,835 3,564 3,299 4,500 Current accountbalance -1,117 -896 -1,112 1,591 Financingitems(net) 1,026 2,200 1,491 Changesin net reserves -130 -1,088 -3,062 Memo: Reservesincludinggold (US$ millions) 1,730 3,810 4,610 Conversionrate (DEC,/oca//US$) 10.6 24.8 58.5 61.4 EXTERNAL DEBT and RESOURCEFLOWS 1982 1992 2001 2002 (US$ millions) :omposition of 2002 debt (US$ mill.) Total debtoutstandingand disbursed 11,704 24,918 32,028 35,113 IBRD 340 2,384 2,796 2,749 IDA 1,051 2,457 4,245 5,394 0:1,540 A 2.749 Total debt service 677 2,318 2,949 2,903 IBRD 53 296 390 367 IDA 11 41 96 111 Compositionof net resourceflows Officialgrants 419 450 839 1,495 Officialcreditors 648 1,009 1,080 758 Private creditors 445 625 -560 -389 Foreigndirect investment 122 335 286 366 Portfolioequity 0 219 -142 -491 World Bankprogram Commitments 359 378 674 1,382 4 IBRD - E Biiateral ~ Disbursements 205 609 669 961 3 D Other multilateral - - ~ F Private ~ Principalrepayments 32 150 300 318 >- IDA IMF G Short-term Net flows 172 460 369 643 Interestpayments 32 188 187 160 Net transfers 141 272 163 483 - 101- Additional Annex 11: PEST MANAGEMENT PLAN (PMP) PAKISTAN: Sindh On-Farm Water Management Project SUMMARY (fullPMP available in Projectfiler and PIP) Background 1. The pestproblemcame into prominence with the introductiono f highyielding andfertilizer responsivecrop varieties inthe country. First import of formulatedpesticide, about 250 metric tons (MT), was done in 1954. Pesticideuse increasedenormously inthe decades o f the 1980sand 1990swhen pesticide business was privatizedandimport o f cheap pesticides, by their generic names, was allowed. Consumption soaredto about 20 thousandMT by 1991and further to 48 thousand MT by 2001. 2. The increaseduse o fpesticideshas disturbed the agro-ecosystemsinthe region. Pesticideshave beeninstrumental inthe killing o f non-targetedandfriendly organisms, including birds, andhave also induced pest resurgences. On the other hand,the social costs o fpesticide use have beenhgh. These include: occupational poisoning, pesticide residues on food, drinkingwater contamination, pest resistance, loss o fbiodiversity, cost o fprevention and abatement measures, and the cost o f awareness campaigns. A scientist's assessmentmade in2000 shows that the extemal costs o fpesticide use inPakistan amounts to about Rs. 12 billion annually. Biological control is seldompracticed except for Trichogramma spp (an egg parasite) that is multipliedinthe laboratories o f sugar millsto control the sugarcanestem borer. Chrysopa spp is a generalpredator which is also usedinsmall quantities inthe cottonareas. Other biologicalcontrol methods, such as male annihilation techniques, use ofpheromones, cultural methods, development of resistantcrop varieties, bio-pesticides such is neem products, planting trap crops etc. are scarcely used. 3. Three types o fpesticide applicators are inuse: knapsack sprayers, ultra low volume applicators, and tractor mounted boom sprayers. Majorityuses the f r s t mentioned while the latter two are usedby large framers only. The knapsack sprayersare manufacturedlocally and are quite cheapbut they start lealungafter a little use and cause great discomfort to the spraying persons. Protective gear is seldomused by farmers, which generally consists ofgloves, respirator or simple mask, apron, goggles, andhelmet. Multinational companiesprovide protective gear free of cost iftheir product is purchasedinsufficient quantities. Since number o f farmers purchasing large quantities o f pesticides is small, use o fprotective gear is minimal. However, its use is slowly increasing as farmers are becomingmore andmore aware o f the harmfbl effects o fpesticides. Cheap protective gear is now available inthe market and its sales are picking up. 4. There is no single methodo fpest control that canbe applied inall situations. I t is, therefore, essentialthat an integrated approach should be adoptedfor effective andeconomical pest control. Integrated Pest Management (IPM) is the best available alternative, which assures sustainableand environment-friendly control o fpests. IPMhas no standarddefinition. It is commonly referred as a diverse mix o fapproaches to managepests andkeep them below damaging levels, usingcontrol options that range from culturalpractices to chemicals. 5. Researchanddevelopment on IPMwas initiated inPakistan in 1971. It, however, got a boost with the inclusioninAgenda 21 ofthe 1992Rio EarthSummit of arecommendationon IPM. The National Agricultural ResearchCenter (NARC) is the focal point o f all I P Mactivities inPakistan. Itis currently implementingthree pilot-scale donor-funded projects and has prepareda national IPMproject estimatedto cost Rs. 197 million over a periodo f 5 years, which has beenapproved by the federal govemment recently. The main objective ofthe project is expandedand sustainableimplementation ofIPMinPakistan, - 102- rationalizing the use o fpesticides while maintaining production levels, and increasing farmers' profit while the main outcome o f the project would be the training o f 500 extension staff and 55,000 fanners in participatory IPMthrough 20 Training o f Facilitator (ToFs) facilities and 840 Farmer Field Schools (FFSs) 6. There i s no government pesticide policy inexistence yet. The recently approved National I P M Project provides for the formulation and review o f national policies on IPM. Therefore, it is hoped that a comprehensive national policy on I P Mwould be preparedsoon. SOFWMP provides funds for the preparation o f a provincial policy and for the review o f the existing law, rules and regulations at the provincial level. The existing pesticide law, titled "The Agricultural Pesticide Ordinance" was promulgated in 1971andAgricultural Pesticide Rulesunder the law were framed in 1973. The 1971Ordinance is a comprehensive law for regulating imports, formulation, sale, distribution, and use, and establishing o f institutions, ensuring quality control, and prescribing penalties for offenses. Implementationo f the laws is, however, generally poor. There are manymalpractices invogue: import o f sub-standardproducts, formulation o f pesticides using less active ingredient, adulteration by distributors duringre-packing, adulteration by pesticide dealers, and preparation o f totally spurious material and labeling them as pesticides. In 1994,23 pesticides were deregistered andtheir use was banned inthe country. 7. An Integrated Social andEnvironment Assessment (ISEA) for the Sindh On-Farm Water Management (SOFWM) Project has been completed. An Environmental Management Plan (EMP), as part o f ISEA, would recommend measures to mitigate possible adverse impacts on the environment, including the potential induced impacts of increased pesticide use. Because o f the significant pest management issues, a Pest Management Plan (PMP) is required to be prepared incompliance o f the Bank's procedures (BP4.01 Annex C), and would form a part ofthe EMP. This PMP has beenprepared infulfillment o f - the Bank's mentioned procedural requirements. It is mentionedat the outset that the PMP does not recommendprocurementof any pestcontrolproductsor methodsunder the projectnor does the projectenvisage any suchprocurement. 8. The Agricultural Extension Department, Sindh has prepared a PC-1(PC-1 i s the abbreviation o f "Planning Commission Proforma 1" which embodies the Government's project document), titled "Integrated Pest Management Plan" for financing under the productivity enhancement component o f the SOFWM Project. The estimated cost o f the project is R.33.1 million and its primary objective is to train 10,500 fanners inpest andpesticide management, with particular emphasis on IPMpractices. Itneeds to be noted here that a National Integrated Pest Management Project, sponsored by the Ministryo f Food, Agriculture andLivestock andto be executedby NARC and aiming at training 55,000 farmers, has recently been approved by the federal government. Sindh will get its share from this national project also butwants to supplement & boost its IPMprogramwith financing available under this Project. The Plan presented here is designed on the lines o f the aforementioned Sindh PC-1. Objectives 9. The main objectives o f the Pest Management Plan are: (i). To increase the productivity o f agricultural crops through Integrated Pest Management (IPM) and IntegratedPlant and Soil Nutrient Management (IPSNM) practices, that includes the rational use o f chemical pesticides and nutrients; (ii). To raise awareness o f all stakeholders about the I P M approach to crop management, and train extension agents and farmers through ToFRFS system to become practitioners o f IPM; and (iii).Todeterminethelevelofpesticideresidueonagriculturalcropsinnormally-treatedand - 103 - IPM-treated areas and&seminate informationto stakeholders on the usefulness o f undertaking IPM practices. Strategy 10. The mainplank o f the strategy would be the promotion o f I P M practices inSindh, which do not exclude the use o fpesticides but at the same time promote an integrated approach to use all available options for controlling pest population for sustainable productivity with no adverse effect on humanbeings, animals andthe environment. I P Mpractices do not envision agricultural fields devoid o f insect life but instead they aim at increasing the complexity anddiversity o f the insects and animals within an agro-ecosystem to encourage its sustainability. Essentially, it is an eco-system based system o f crop management. 11. The traditional agricultural extension andresearch systems are not equipped to deal with the increasingly complex situations emerging inthe crop management area. Therefore, there is a dire needto innovate to meet the new challenges. Farmers must learn to become self-reliant by acquiring basic knowledge o f crop management while extension agents must transform themselves into facilitators o f change. Bothneedto learn new skills through a system o f trainingby which each trainee first practices the slulls under expert advice to reach a minimumlevel o f competency, and then practices further untilhe has mastered the skills. 12. The ToFFFS training system has been designed to achieve the above-stated purpose. Under this system, the experts train (ToF) extension agents (also researchers, members o f NGOs, women etc) to acquire knowledge about environmental conservation, public health, social participation, andorganization, and become facilitators o f change. Side by side, farmers are trained (FFS) by facilitators incomparing new techniques in systematic field evaluations. It is a kindo f field-based participatory training where extension agents and farmers work together for the duration o f a cropping season. The test o f successfultraining would lie indemonstrating that: (i) farmers have become more self-reliant and are able to evaluate new technologies by themselves; (ii) extension agents are able to facilitate the change processes anddialogues on farmer andpublic interest issues, including environmental conservation and health; and (iii) research institutions are able to provide technologies that can be tested inthe field by farmers. 13. Inthe project area, besides farmers andextensionagents ingeneral, members ofWater Course Associations (WCAs), Farmer Organizations (FOs) and Area Water Boards (AWBs) would also be trained. Women perform many functions inagricultural fields, the most important among them being cotton picking. They would be recognizedas an important target group inall training programs. 14. The objectives of the project will not be acheved ifthe decision makers andkey officials are not sensitized about the importance o f IPM, which includes the rationaluse o f pesticides. The project would provide for workshops, seminars, andprograms on electronic media. 15. Underthe project,the concept ofIntegratedPlantandSoil Nutrient Management(IPSNM) would also beintroduced. The concept underscores the management o fbothorganic andinorganic plant nutrients for optimalproduction o f the cultivated crop, forage, and tree species while conserving the natural resource base that is essential for the long-term sustainability o f the agro-ecosystems andthe environment. - 104- Organic fertilizers bringabout many useful changes inthe chemical, microbiological and physical properties o f soil that enhance soil fertility. The effect i s long-term andnot immediate, and, therefore, farmers hesitate to use organic fertilizers. Highlevels o f organic residue incorporation, especially infine textured soils, improves its structure: soil porosity, pore size distribution, bulk andparticle densities, aggregate stability, water holding capacity, aeration, infiltration, andhydraulic conductivity. The recycling of soil derived nutrients is also improved through proper organic residue management. The strategy for IPSNMwould include: (i) improving crop rotations by growing legumes as food crop or live mulch (cover crop); (ii)maximizingorganic matter production through green manure, cover crops and agro-forestry; (iii) enhancing naturalprocesses o fnutrient recyclingthrough managing plant-soil-pest-predatorinteractions; (iv) providing soil cover (mulch, cover crops) to supply nutrients, reduce weeds and labor, andenhance fimctions o f soil biota and plantroots; (v) selecting and breeding crops with higher nitrogenuse efficiency, resilience to deficiencies andnitrogen fxing capacity; and (vi) maximizing crop, soil andanimal biodiversity to reduce diseases and pest outbreaks. Activities to be Undertaken 16. Review of Policy and Laws. The Sindh province, based on the IPMexperience so far, would formulate its own pesticide policy. Itwould also seek amendments inthe Agncultural Pesticide Ordinance 1971inconsultation with federal and other provincial governments. These couldbe inthe areas which got prominence inrecent times, for example, adulteration o f pesticides, the environment related issues, use o f bannedpesticides, the definition o fpesticide itself, pesticide laboratories, appointment o fjudicial magistrates for tryingpesticide offenses, review o f fines and penalties etc. 17. Awareness Programs. All media would be used to disseminate awareness programs. These would include printandelectronic media, newspapers, agricultural department's monthly magazine, seminars, workshops, field demonstrations, etc. The main areas that would be covered would relate to human health, like pesticide handling, usage, storage and disposal, other health hazards, types o fpesticide application equipment, protective gears, eco-friendly alternatives, promotion o fbio-pesticides, and promotion o f IPMand IPSNM practices. Item of Training Year2 Year3 Year4 No. of ToFs 2 2 2 Trained Facilitators 50 100 Trainee Facilitators 5c 50 50 FFSby Trained Facilitators 4 104 200 FFSby Trainee Facilitators 2q 20/ 20 FFS by Trained Farmers 60 Total FFSs 20 120 280 FarmersTrained 50C 3.00C 7.000 19. Integrated Plant and Soil NutrientManagement (IPSNM). Integrated Plant and Soil Nutrient - 105- Management pertains to the combined use o f organic and inorganic fertilizers inproper proportion accompanied by sound cultural managementpracticesincrop production. It i s an approachthat seeks to both increaseagricultural production and safeguardthe environment for future generations. Researchhas provedthat neither inorganic fertilizers nor organic fertilizers alone can achieve a sustainable productivity o f soils as well as crops underhighly intensive cropping systems. Also, as water is becoming scarce, the application o f organic fertilizers needs to be encouragedto increase the soil water holding capacity and provide more available water to the plants. A pilot scale operation, inconcert with the Water Course Associations (WCAs)/Farmer Organizations (FOs), wouldbe undertakeninthe project area to promote the use o f organic fertilizedresidues, composting and wormi-culture. Since the activity would initially affect farmer income andonly benefit himinthe longer term, suitable financial incentives would be providedto the farmers under the project to compensate them for the losses incurred. About 25 one-hectare demonstration plots would be laidout to promote IPSNMinthe project area. Results would be monitored. 20. PesticideResidue. Underthe ToF/FFS systemoftraining, controlplots, where prevalent practices o fpesticide use are undertakenand experimental plots where farmers practice IPM, are laid out. Samples o fpesticide residueon crops, particularly cotton, rice, fruits andvegetables, would be collected from both kinds ofplots andthe quantity ofpesticideresidue determined. This would help establishthe usefulnessof adopting IPMpractices. The work ofpesticide residue determination wouldbe contracted out to existing researchlaboratories that possessthe desiredfacilities (Laboratories o f Pakistan Council o f Scientific and Industrial Researchand SouthernZone Agriculture ResearchCenter's Pesticide ResearchInstitute, Karachi). Monitoring o fpesticide residue would be carried out throughout the project period and information disseminatedwidely to helpbringdown the level o fresidue to below the MaximumResidue Limit(MRL). Post-harvestuse ofpesticides, particularlyonvegetableswould also be monitored. An analytical study on the work done wouldbe preparedinthe last year of the project period. 21. Information Dissemination. Informationmaterial wouldbe preparedand distributedwidely. This wouldbe inthe form of printedbrochures, pamphlets, andbooklets. The circulation o f the departmental agricultural magazinewouldbe increasedto reachmaximum number of stakeholders, which, among others, would include government officials, particularlyo fthe newly establisheddistrict governments andtheir lower tiers, WCAs, FOs, educational institutions, pesticide manufacturers and sellers, farmers, NGOs, and women. . 22. RewardingandRecognition. A systemofrewards andrecognition wouldbe constituted to encouragethe adoption o f IPMandIPNMpractices anduse o fbio-pesticides. District governments and their lower tiers wouldbe actively involvedso that it becomesa regular practice at local levels. Funds from ToF/FFS allocation would be used for this purpose. 23. StrengtheningInstitutionalCapacityonIPSNM. Short refresher coursesfor the officials ofthe Plant Protection Directorate of the Agricultural Extension Department and District Officers (Agriculture) would be arrangedthrough the Sindh Agricultural University. - 106- 24. The following matrixprovides a logicalframework for the implementationof the PMP: NarrativeSummary ExpectedResults PerformanceIndicators AssumptionslRisks Objective 1 0 Farmers start Evidence in 0 Government's Increase productivity o f adopting I P M and IPNM terms o f reduction inthe commitmentto using agricultural crops through practices. average use o f chemical IPMpracticesin rational use o f IPMand 0 Farmers reduce pesticides and fertilizers agricultureremains IPNM practices. the use o f chemical strong. pesticides. 0 The newly 0 Farmers approvedNational increase the use o f natural IntegratedPest fertilizers. ManagementProject 0 FOs and WCAs (NIPMP) is members participate in implementeddiligently. I P M and IPNM programs. Objective2 0 Members of Evidence of Raise awareness o f all AWBs, FOs andWCAs increase o f awareness stakeholders about the are sensitized about the among people about I P M I P Mapproach to crop efficacy of I P M and and IPNM practices. management, and train IPNMpractices. extension agents and 0 Other farmers through ToFiFFS stakeholders are educated system to become on I P M and IPNM practitioners o f IPM through workshops, seminars, printand electronic media, printed material, field demonstrations etc. ToFsiFFs are established. Objective 3 Evidence of Helpbringpesticide Pesticide increaseinstakeholders' residue on agricultural crops to below MRL crops is monitored. harmfulnessof pesticide -107 - Milestones Performance Indicators 4ssumptionsi Risks Activity 1 a Agricult a Provincial a Adulteration of b Governm Review o f ural pesticide pesticide policy is pesticides and use o f mt's commitment policy and policy and laws are framed. banned pesticides i s to using IPM laws implemented. a Agricultural curtailed. practices in Pesticide Ordinance a Judicial agriculture 1971is amended to magistrates for trying remainsstrong. take account o f Sindh's pesticide offences are concems. appointed. a Offenders are punished. Activity 2 a Stakehol a Print and a Incidence o f B AWBs, Awareness ders are better electronic media, accidents inhandling, FOs, andWCAs programs aware o f harmful newspapers, usage, storage and disposal are continuously effects o f agricultural o fpesticides is reduced. involved in pesticides and department's weekly a Use o f bio- information efficacy o f IPM magazine, seminars, pesticides is increased. dissemination practices. workshops, and field a IPMand IPSNM programs. demonstrations would practices are adopted. be suitably used for enhancing the awareness o f stakeholders inthe area o fpesticides. Activity 3 a If a Stakeholders a Two ToFs are GoSindh Establishment needed, on the are trained inI P M established every year is convinced of the o f ToFs and basis o f appraisal practices on farmers' starting from year 2. need to train more FFSs o f performance o f fields. a 420 FFSsare stakeholders than the NIPMP, .ToFs established. the number to be and FFSs would be a 10,500 farmers trained under the established. (would also include ongoing NIPMP. members o f WCAs, FOs, and NGOs, and women) would be trained. Activity 4 a Use o f a A pilot scale a 25 plots are laid a GoSindh Introduction o f organic fertilizers operation, in concert out to demonstrate the is convinced of the IPSNM and residues i s with the Water Course usefulness o f IPSNM. need to introduce promoted. Associations a Financial eco-friendly (WCAs)/Farmer incentives are provided to practices inthe Organizations (FOs), i s participating farmers. agriculture sector. launched to introduce a Results are IPSNM inthe project monitored. area. Activity 5 a Reductio a Samples a Evidence o f a GoSindh Pesticide ninlevels o f collected. increase instakeholders' commits to Residue pesticide residue a Pesticide awareness about provide adequate on agricultural residue on agricultural harmfulness o fpesticide funds for this crops. crops tested and residue on agricultural research activity, monitored. crops. which normally is a Information neglected. disseminated - 108- Activity 6 a Maximu a Information a Evidenceof a AWBs, Dissemination minformation material inprinted increaseddistribution of FOs,and WCAs of information reachesmaximum form, preparedbothby printedmaterial. are continuously people. extensionandresearch, a Evidenceof the involved in i s distributed widely. extent ofuse of database information andwebsite by dissemination stakeholders. programs. Activity 7 a Practitio a A systemof a Evidenceof a Newly Rewarding ners of IPMand rewardsand distribution of awards at established and IPSNh4 get recognition is instituted district levelsbecoming an District recognition recognition. to encourage the annual feature. Governments' adoptionof IPMand commitment to IPSNMpracticesand adoption of IPM use of bio-pesticides. and IPSNM. Activity 8 a Agricult a Short a Evidence of a GoSindh Strengthening ural officials at all refresher coursesfor enhanced knowledge of 's commitment by institutional levels are abreast the officials of the I P S N Min agricultural way of capacity in of developments Agricultural officials. encouraging and I P S N M inthe fields of Extension allowing officials IPSNM. Department and to attend refresher District Governments courses. are arranged to keep them abreast of the latest developments in IPSNM. ImplementationResponsibilityandInstitutionalArrangements 25. Responsibility for agricultural extension (relevant for IPSNM activities) and pest management (for I P Mactivities) rests with the Director General (DG), Extension. Hisstaff officer to help implement these activities i s the Director, Plant Protection (PP) who inturn is assisted inhis work by a Plant Protection Officer, and an Agricultural Officer (3). Inthe field, District Governments handle this work through a hierarchical setup: Executive District Officer/District Officer, Agricultural Extension at District level; Deputy District Officer at Taluka level; Agricultural Officer at Sector level; and FieldAssistant at the Union Council level. Thus the actual frontline workers who would implement the activities are Sector Agricultural Officers andUnion Council FieldAssistants. The District Governments, for donor-assisted projects such as this, report to and seek guidance from DG, ExtensiodDirector, PP. 26. Research inpest management is carried out at the following five research institutes: (i) AgriculturalResearchInstitute,Tandojam (ii) Sindh Horticulture Research Institute, MirpurKhas (iii) WheatResearchInstitute,Sakrand (iv) Rice Research Institute, Dokri (v) Quaid e Awam Research Institute, Larkana 27. The horizontal (between research and extension) andvertical (between DGExtension andDistrict Government) linkages inthe area o f pest management are not strong. There are two main reasons for this: firstly, the operational budget for pestmanagement, both for extension andresearch, is very small and there is little research or extension work that is needed to be shared; and secondly, Extension andResearch officials report directly to their superiors and collaborate horizontally only on a needs basis. Following devolution o f powers to districts inthe recent past, District Officers (Agriculture) report directly to their District superiors andhave little obligationto DGExtension. The advantage inrespect o f donor-funded - 109- projects, however, is that District Governmentsare requiredto report to and seek guidance from the Provincial Government. Insuch a situation, the role of the existing Research-ExtensionCoordination Committee and the Cotton Committee becomesmuch more important. It would be the endeavor of the government to ensure that the former meetsregularly on a monthly basis andthe latter, inthe cotton season, on a fortnightly basis. District Officers (Agriculture) would be actively associatedwith these committees. 28. A donor-funded (ADB, EU,AGFUND)NationalIPMProgram isbeingexecutedbyFA0through NARC and the latter's provincial counterpart (Director PP) anddistrict level coordinators. A 5-year National IPMProject to train about 55,000 farmers inIPMpractices has also been recently approved by the federal govemment. Sincethis plan, under SOFWMproject, would supplementthe NARC-led National IPMProject activities inSindh, a strong linkage betweenNARC and Sindh Agnculture Extension Departmentwouldbe establishedso that the activities ofthe two are properlycoordinated. Forthis purpose, anI P MCoordination Committee wouldbe establishedat the provincial level, which wouldmeet quarterly andhave representationfromprovincial researchinstitutions, extension andNARC. Phasingof Activities 29. Annual phasing of activities andcosts wouldbe as follows: Activity -Amt. Y r 3 Awareness Raising/ Disseminationof 1.6 1.6 6.5 Information - Monitoring Sample ~ Pesticide 75 0.5 75 0.5 300 2.1 Residue lo** + IPNSMDemo. Plots 15*= Plots ---- - 25 1.2 15** 0.8 50 2.5 FarmersI ~ IPMthrough 3,000 3.9 7,000 9.2 10,500 13.8 TofiFFS 0.0°131 Training and Studies - Training in LS 0.1 IPSNM - PolicyiLaw 1 0.2 Study -- - Pest. Res. 1 0.2 1 0.2 Study - I - Vehicles - - - 4 6.0 Veh. Opr. Costs 0.5 0.5 LS 1.7 Total 4.0 8.5 - - - - - 7.8 12.8 33.1 Note on table inpara 29: * denotesnumber o fnew plots; ** denotesnumber o fplots maintained inyear 2. - 110- Particulars Costs (Rs.inmillions) Awareness Raising/Dissemination of Information 6.5 MonitoringPesticide Residue 2.1 1TPNSM DemonstrationPlots I 2.51 IPMthroughTofIFFS 13.8 Training and Studies Training inIPSNM 0.1 PolicviLaw Studv 0.2 I Pest. Res. Studv I 0.2 I IVehicles I 6.01 Vehicle OperatingCosts 1.7 Total 33.1 MonitoringandEvaluation 31. Monitoring would involve establishing a baseline of the current status and observing and measuring, over the project period, the impact ofproject interventions on cotton, fruits andvegetables. Mid-termandpost-project evaluationswouldalso becarried out. The followingkeymonitoring indicators are suggested: (i). quantityofpesticideused (ii). number of sprays and area sprayedby crop; (iii).pesticideresiduesonfruitsandvegetables;and (iv). Use o f bannedpesticides, ifany. Recommendations 32. IPMwork done so far inthe country hasbeenmainly donor drivenandon a pilot scale. The recently approvedNational IPMproject is going to be the first major indigenous endeavor funded through the public sector development program. Before hlly embarking upon an independent provincial IPM project, as envisagedinthe PC-1 referred inpara 7 above andthis pest managementplan, it would only be appropriateto watch the implementation of the recently approvedNational IPMProject for some time. Accordingly,except for the activities describedinpara32 below, a decisionwhether or notto implementthe remainingcomponentsofthe PC-lPMP(essentiallyfarmer trainingunderthe ToF/FFS concept), would be taken duringimplementationofthe project onthe basis of the performanceof the nationalIPMproject. 33. A sumor Rs. 33.1 million, as suggestedinearlier paragraphs,hasbeen set aside inthe SOFWM project for a series o f I P MandIPSNMrelated activities. Monitoring o f pesticide residues, IPSNMpilot operation, andawareness raising/dissemination of information, besides purchasing o f vehicles (part) and repair o f vehicles, which are o f immediate concem, would be started from the first year o fproject implementation. FOs andWCAs would be actively associatedwith the implementationo fthe IPMAPSNM activities envisagedunder this project. However, a decision whether or not to implement the farmer training activity (under the ToF/FFS concept) from the secondyear o fthe project would be takenon the basis of the performance of the national project and implementation capacity then available within the SindhAgncultural Extension Department. (i) MonitoringofPesticideResidue. The work oftesting pesticide residue on agriculturalcrops, - 111 - particularly fruits andvegetables, would be got done on payment basisby existing researchlaboratories. Samples would be collected from control and experimental plots of the on-going and future NARC sponsoredI P Mprograms under the ToF/FFS systemor from suchplots which may come into existence from year 2 o fthe project. Local FOs andWCAs would be associated. The test results would thus establishthe usefulness o f adopting IPMpractices. Monitoring o fpesticide residueswouldbe carried out throughout the project periodandefforts madeto bringdown the level o fresidueto below MRL. Post-harvest use o fpesticides, particularly on vegetableswould also be monitored; (ii) IntegratedPlantand Soil NutrientManagement. A pilot scale operation wouldbeundertakenin theproject area to promote the use oforganic fertilizers/residues inassociationwith WCAs and FOs. About 25 WCAs would be persuadedto establishan equal numbero f one hectaredemonstration plots to promote IPSNMintheir areas. Firstactivity inthe plots wouldbe soil testing, which would determine the physical and chemical properties andmacro andmicronutrients o f soil. The activities to be demonstrated would inter alia include: use of organic fertilizer, green manuring,mulching, weeding, leguminous crops for nitrogen fixing, composting, andwormi-culture. The plots wouldbe maintained for two years. Since the activity would initially affect farmer income andonly benefithiminthe longer term, suitable financial incentives would be providedto the farmers under the project to compensatethemfor the losses incurred. Results would be monitored. Prior to laying out plots, Agricultural Extension staffwould be imparted training inIPSNM, including composting andwormi-culture, at the Sindh Agricultural University; and (iii) Awareness Raisinflissemination of Information. Printedbrochures,pamphlets, andbooklets on various aspects o f IPM andIPSNMwould be prepared anddistributed widely through FOsand WCAs. The circulationo fthe departmentalagricultural magazinewouldbe increasedto reachmaximumnumberof stakeholders,which, among others, would include government officials, particularly of the newly establisheddistrict governments andtheir lower tiers, WCAs, FOs, educational institutions, pesticide manufacturers and sellers, farmers, NGOs, and women. Seminars at district andprovincial levels for discussingproject achievementswould also beheld. All media would be usedto disseminate awareness programs. These would include print and electronic media (radio and TV programs andvideo films), newspapers, agricultural department's monthly magazine, seminars, farmer field days, etc. The mainareas that would be covered wouldrelate to humanhealth, like pesticide handling,usage, storageanddisposal, other health hazards, types of pesticide application equipment, protective gears, eco-friendly altematives to pesticides including bio-pesticides, andpromotion o fI P Mand IPSNMpractices. - 112- AdditionalAnnex 12: DetailedCost Tables PAKISTAN:Sindh On-FarmWater Management Project - 113 - Components Project Cost Summary Summary Costs Table (a) YO O hTotal Rs uss Million Million Foreign Base Local Foreign Total Local Foreign Total Exchange Costs A. SocialM. andCapacityBuilding 241.77 17.76 259.53 4.17 0.31 4.47 7.35 5.76 B. Improvement of Irrigation Facilities (i)ImprovementofWatercourses 2,822.84 141.35 2,964.19 48.67 2.44 51.11 5.01 65.80 (ii)ImprovementofDistributaries 464.71 33.50 498.21 8.01 0.58 8.59 7.21 11.06 (iii) Improvementsof BranchCanals 197.12 16.50 213.62 3.40 0.28 3.68 8.37 4.74 C. Productivity Enhancement 267.24 21.15 288.38 4.61 0.36 4.97 7.91 6.40 D. Monitoring andEvaluation 77.85 15.64 93.49 1.34 0.27 1.61 20.10 2.08 E. ProjectManagementSupport 149.89 37.83 187.72 2.58 0.65 3.24 25.24 4.17 Total Basecosts 4,221.41 283.14 4,505.15 12.18 4.89 11.68 6.12 1oo.00 PriceContingencies 393.69 17.81 411.51 6.79 0.31 7.09 4.52 9.13 Total Project Costs 4,615.10 301.55 4,916.66 19.51 5.20 84.11 6.53 109.13 ExpendituresAccounts by Categories Total Including Contingencies - (Rs Million) Social 0) (ii) (iii) Categories, Components Mobilization Improvement Improvement Improvements Productivity Monitoring Project Total O f Management Project and ~ q a c i t yWate;;urses Building Distributarie ofCanals Branch Enhancement Evafiftion support costs S Investment Costs A. Civil Works -Materials 2,151.94 492.09 220.85 149.69 3,014.57 - Skilled Labor 339.26 339.26 270.66 270.66 ~Un Skilled Labor SubTotal 2,761.86 492.09 220.85 149.69 - 3,624.50 B.Incremental Staff 137.72 313.44 36.61 7.43 495.20 C. Vehicles & Motor cycles 50.56 63.82 2.48 4.95 10.06 11.21 17.86 160.93 D.Equipment 7.00 14.17 3.47 5.01 95.00 4.43 6.72 135.81 E.Training 15.07 45.59 60.66 F.ConsultingServices 61.27 105.43 166.70 G. ImplementingO&M Costs 70.25 87.39 9.47 4.49 6.38 23.46 71.40 272.85 Total Project Costs 280.61 3,240.69 544.12 235.31 314.16 100.37 201.41 4,916.66 - 114- Social (0 (ii) (iii) Categories/ Components Mobilization ImprovementImprovement Improvement Productivity Monitoring of Project and Capacity of of Branch Enhancement and Management Building Watey Distributaries Canals Evaluation Costs .Materials 37.10 8.48 3.81 2.58 51.98 .Skilled Labor 5.85 5.85 .UnSkilledLabor 4.67 4.61 47.62 8.48 3.81 2.58 62.49 B. Incremental Staff 2.37 5.40 0.63 0.13 8.54 C. Vehicles & Motorcycles 0.87 1.10 0.04 0.09 0.17 0.19 0.3 1 2.77 D. Equipment 0.12 0.24 0.06 0.09 1.64 0.08 0.12 2.34 E. Training 0.26 0.79 1.05 F. Consulting Services 1.06 1.82 2.87 G. ImplementingO&M Costs 1.21 1.51 0.16 0.08 0.11 0.40 1.23 4.70 rota1Project Costs 4.84 55.87 9.38 4.06 5.42 1.73 3.47 84.77 - 115- Table 1: Social Mobilization & Capacity Building Quantities Unit RupeesMillion For. Gross Uniti costs Exch Tax Staff Year-I Year-2 Year-3 Year-4 Total BPSRs Year-1 Year-2 Year-3 Year4 Totai % Rate% (a) Project Allowance for Existing District Teams 1/ DeputyDirector(F)/DO(WM) 4 48 48 48 48 192 BPS-18 0.132 0.135 0.138 0.142 0.547 Account Asst./Office Assistants 4 48 48 48 48 192 BPS-11 0.052 0.053 0.055 0.056 0.216 I/WMO(Agri) isplacedunder Productivity Enhancement Incremental Staff (District (b) Teams) DD(F)/DO (WM) 12 24 144 144 144 456 BPS18 0.406 2.519 2.604 2.688 8.216 Asst agronomist 12 24 144 144 144 456 BPS17 0.316 1.966 2.033 2.100 6.414 WMO (Social Mob Male) 16 72 192 192 192 648 BPS17 0.949 2.621 2.710 2.799 9.080 WMO (Social Mob Female) 16 72 192 192 192 648 BPS17 0.949 2.621 2.710 2.799 9.080 Asst Account Officer 16 72 192 192 192 648 BPS16 0.699 1.920 1.977 2.033 6.629 Computeroperator 16 72 72 72 192 408 BPS15 0.618 1.699 1,750 1.801 5.868 Office Assistants/AccountAssistant 12 24 144 144 144 456 BPSll 0,146 0.902 0.927 0,953 2.928 SeniorClerk 16 72 192 192 192 648 BPS07 0.333 0.910 0.933 0.956 3.132 Jr. Clerk 16 72 192 192 192 648 BPS05 0,295 0.806 0.826 0.845 2.772 Driver 16 72 192 192 192 648 BPS04 0.269 0.734 0.751 0.767 2.521 NaibQasid 16 72 192 192 192 648 BPSOl 0.214 0.581 0,591 0.602 1.988 Chowkidar 16 72 192 192 192 648 BPSOl 0.214 0.581 0.591 0.602 1.988 Regularand SpecialAllowances for District Teams 3.438 9.815 9.984 10.154 33.391 Sub total 9.030 27.864 28.580 29.296 94.770 (c) Salaries of Incremental Staff (FM,SDC, Media Cell) (i)FMSupportGroup(WCAs &FOs) 2.700 2.889 2.902 2.916 11.408 (ii)SocialMobilization Group(SD Cell) 3,828 4.067 4,083 4.101 16,079 (iii)SocialMobilizationGroup(Communication) 0.732 0.852 1.092 1.092 3.768 IncrementalSalaries (SM&CB) 16.290 35.672 36.657 37.405 126.025 ~ 5 (d) Training (i) CapacityBuildingat SkrandT I (ii) WCAsandStaff FOs, Nos 3,500 4,000 3,500 1,500 12,500 800 2.800 3.200 2.800 1.200 10,000 (iii)SocialMobilizationGroup(SDCell) 0.900 1.200 1.200 0.700 4.000 SubTotal (d) 3.700 4.400 4.000 1.900 14.000 3 ~ (e) Vehicles(For Skrand Institutes & District Teams) CoasterforT Institute Sakrand Nos 1 - - - 1 4,500,000 4.500 - - 4.500 Pick-Up Double Cabin 4 X 2 Loaded Nos 6 10 - - 16 2,125,000 12.750 21.250 - 34.000 ~ Motorcycles (70 cc) Nos 6 10 - - 16 60,000 0.360 0.600 - - 0.960 Sub Total (Vehicles) 17.610 21.850 - - 39.460 (i)FMSupportGroup(WCAs&FOs) 0.720 - - 0.720 (ii)SocialMobilization Group (SD Cell) 7.925 - - 7.925 (iii)SocialMobilizationGroup(Communication) 0.180 - 0.180 ~ Sub-Total (e) 26.435 21.850 - - 48.285 30 50 - 116- Table 1:Continued Quantities Unit Rupees Million For. Gross Unit/ costs Exch Tax Staff Year-1Year-2 Year-3 Year4 Total BPS/Rs Year-1 Year-2 Year-3 Year-4 Total % Rate% (0Equipmentfor DistrictTeams Computers(Pentium IV) Nos 6 I O 16 50,000 0.300 0.500 - - 0.800 Computer Software _ _ _- _- Lumpsum 0.026 - - 0.026 Computers(Pentium 111) Nos 6 I O - - 16 15,000 0.090 0.150 - - 0.240 Printer Ink Jet A4 Size Nos 6 I O - 16 10,000 0.060 0.100 - 0,160 ~ ~ Facsimile Machine Nos 6 10 - - 16 20,000 0.120 0.200 - . 0.320 Stabilizers Nos 12 20 - 32 8,000 0.096 0.160 - - 0.256 ~ Airconditionen(WindowTpej Nos 6 10 - - 16 25,000 0.150 0.250 - - 0.400 Furniture& Fixturefor: (i) Teams(16Nos)@Rs100,000perTeam Area Lump sum 0.600 1.000 - - 1,600 (ii)FMSuppoltGroup(WCAs&FOs) 0.510 0.510 ~ (iii)SocialMobilizationGroup(SDCell) 0.805 -- - 0.805 (iv) Social Mobilization Group (Communication) 1.594 - - 1.594 Sub-Total (0 4.351 2.360 - - 6.711 20 20 (9) RecurringCosts (i)RecurringCostsforDGAE&WM 6.181 10.002 10.653 11.854 38.690 (ii)FMSupportGroup(WCAs&FOsj 1.248 1.248 1.248 1.248 4.992 (ii)SocialMobilizationGroup(SDCell) 3.252 3.252 3.252 3.252 13.008 (iii)SocialMobilizationGroup(Communication) 1.784 1.856 2.036 2.144 7.820 Total RecurringCostsSM&CB 12.465 16.358 17.189 18.498 64.510 3 3 TOTAL COST(SM&CB) 63.242 80.639 57.847 57.803 259.531 - 117 - Table 2: Improvement of Watercourses Gross Quantities Unit Base Costs (Rupees Million) Foreign Tax UnitiStaf f Year-1 Year-2 Year-3 Year4 Total CostsRs Year-I Year-2 Year-3 Year-4 Total Exch %Rate % A Watercourse Improvements (i) Areas FGW Nos. 140 310 400 450 1300 WC Materials 338,813 47.434 105.032 135.525 152.466 440.457 6 5 ~ -- Un-skilled Skilled Labor 51,075 7.151 15.833 20.430 22.984 66.398 Labor 49,877 6.983 15.462 19.951 22.445 64.840 Sub total (i) 439,765 61.567 136.327 175.906 197.894 571.695 (ii)SGWAreas Nos. 320 630 750 800 2500 - WC Materials 583,272 186.647 367.461 437.454 466.618 1,458.180 - Skilled Labor 93,600 29.952 58.968 70.200 74.880 234.000 - Un-skilled Labor 71,153 22.769 44.826 53.365 56.922 177.883 Sub total (ii) 748,025 239.368 471.256 561.019 598.420 1,870.063 (iii) InBaraniAreas W/Cs Nos. 40 50 50 60 200 - WC Materials 205,872 8.235 10.294 10.294 12.352 41.174 - Skilled Labor 26,798 1.072 1.340 1.340 1.608 5.360 Un-skilled Labor 13,050 0.522 0.653 0.653 0.783 2.610 ~ Subtotal (ui) 245,720 9.829 12.286 12.286 14.743 49.144 (iv) Water storage Tanks Nos 10 40 70 80 200 - Civil Works/ Materials 126,391 1.264 5.056 8.847 10.111 25.278 6 5 - Skilled Labor 20,250 0.203 0.810 1.418 1.620 4.050 -Unskilled Labor 9,000 0.090 0,360 0.630 0.720 1.800 Sub Total (iv) 155,641 1.556 6.226 10.895 12.451 31.128 B FieldTeams (a) ProjectAllowance for ExistingFieldTeams Assistant Director (F) 20 240 240 240 240 960 BPS-17 0.500 0.512 0.524 0.537 2.073 WMO Eng 40 480 480 480 480 1,920 BPS-16/17 1.000 1.024 1.049 1.073 4.146 WMO Agr 20 240 240 240 240 960 BPS-17 0,500 0.512 0.524 0.537 2.073 Office Assistant 20 240 240 240 240 960 BPS-11 0.260 0.266 0.273 0.279 1.078 Jr. Clerk 24 288 288 288 288 1,152 BPS-05 0.208 0.213 0.218 0.223 0.862 Driver 24 288 288 288 288 1,152 BPS-04 0.189 0.193 0.198 0.202 0.782 Rodman 20 240 240 240 240 960 BPS-01 0.120 0.123 0,126 0.129 0.498 Naibqasid 24 288 288 288 288 1,152 BPS-01 0.144 0.148 0.151 0.155 0,597 Chowkidar 24 288 288 288 288 1,152 BPS-01- 0.144 0.148 0.151 0.155 0.597 Sub total -(a) 3.065 3.139 3.214 3.289 12.707 IncrementalStaff (b) Directorate Office DD(P&M) 1 12 12 12 12 48 BPS18 0.203 0.210 0.217 0.224 0.854 DD(Water Management)) 1 12 12 12 12 48 BPSl8 0.203 0.210 0.217 0.224 0.854 Computer operator 2 24 24 24 24 96 BPSl5 0,206 0.212 0.219 0.225 0.862 Regular and Special Allowances 0.391 0.397 0.403 0.409 1.601 SubTotal (b) 1.003 1.029 1.056 1.083 4.171 - 118- Table 2: Continued (e)Incremental Staff (Field Teams) ADF(F)/DDO( WM) 30 144 360 360 360 1,224 BPS17 1.899 4.914 5.081 5.249 17.143 WMO (Engr) 60 288 720 720 720 2,448 BPS16/17 3.529 9.158 9.493 9.828 32.009 WMO (Agri) 30 144 360 360 360 1,224 BPS17 1.899 4.914 5.081 5.249 17.143 ComputerOpp 50 384 600 600 600 2,184 BPS15 3.297 5.310 5.469 5.628 19.704 Steno typest 50 384 600 600 600 2,184 BPSl2 2.552 4.104 4.221 4.338 15.215 Sub Engineers 100 168 1,200 1,200 1,200 4,368 BPSll 4.677 7.518 7.728 7.938 27.861 Office assistants 30 144 360 360 360 1,224 BPSll 0.877 2.255 2.318 2.381 7.832 Junior Clerk 26 96 312 312 312 1,032 BPS05 0.394 1.310 1.342 1.373 4.418 Driver 26 96 312 312 312 1,032 BPSO4 0.359 1.193 1.220 1.246 4.019 Rodmen 180 1,296 2,160 2,160 2,160 7.776 BPSOl 3,849 6.534 6.653 6,772 23.808 Naib Qasid 26 96 312 312 312 1,032 BPSOl 0.285 0.944 0.961 0.978 3.168 Chowkidar 26 96 312 312 312 1,032 BPSOl 0.285 0.944 0.961 0.978 3.168 Regularand SpecialAllowances for FieldTeams 14.016 26.296 27.044 27.478 94.833 Sub total -(e) 31.911 15.395 11.573 19.436 270.320 Incremental Costs (a+b+c) 41.984 19.564 81.843 83.801 281.198 0 5 C Equipment Computers (Pentium IV) Nos 50,000 0.100 - 0.100 Laptops(Pentium IV) Nos 110,000 0.110 0.110 Computer Software Lump sum 0.044 -- 0.044 Computers (Pentium 111) Nos 2 - - - 2 15,000 0.030 0.030 ~ Laser Printers Nos 2 - - - 2 30,000 0.060 - 0.060 Printer Ink Ject A3 Size Nos 1 - I 18,000 0.018 - 0.018 Printer Ink Jet A4 Size Nos 1 - - - 1 10,000 0,010 - 0.010 Scanners Nos I - - - 1 10,000 0.010 - 0.010 UPS Nos 4 - - - 4 10,000 0.040 0.040 ~ PhotocopierMachine Nos 1 - - - 1 150,000 0.150 - 0.150 FacsimileMachine Nos 1 - - - 1 20,000 0.020 - 0.020 Stabilizers Nos 4 - - - 4 8,000 0.032 - 0.032 Air conditioners(Window Nos 4 - - - 4 25,000 0.100 0.100 Portable Generator Nos I - - - 1 32,000 0.032 -- 0.032 Spiral Binding Machine Nos 1 - - - 1 30,000 0.030 - 0.030 Auto Level (with Metallic Tripod Nos 38 28 - - 66 100,000 3.800 2.800 - 6.600 & 3 PieceAluminum StaffRod) RangePoles Nos 200 150 - - 350 400 0.080 0.060 - 0.140 Meas. Tape (Fiber Glass) 30 M Nos 48 18 - 66 500 0.024 0.009 - 0.033 Cut Throat Flumes Nos 34 18 -- - 52 15,000 0,510 0.270 0,780 ~ Furniture& Fixture Lump sum 2.250 2.250 ~ Area Teams (50 Nos) @ Rs60,000 per Team 1.920 1.080 Sub total C (Equipment) - 9.370 4.219 - 13.589 20 20 D Vehicles Pick-UpDCabin4 X 2 LoadedNos 3 - - 3 2,125,000 6.375 - 6.375 ~ Pick-Up S Cabin4 X 2 Standard Nos 30 16 - - 46 800,000 24.000 12.800 - 36.800 Pick-Up S Cabin4 X 4 Standard Nos 2 2 - 4 2,000,000 4.000 4.000 - 8.000 ~ Motorcycles for Directorate Office Nos 5 - - 5 60,000 0.300 - 0.300 Motorcycles for FieldTeams Nos 64 96 - -- 160 60,000 3.840 5.760 - 9.600 Sub Total - D (Vehicles) 38.515 22.560 - 61.075 30 50 E RecurringCosts (Director Office &Field Teams) 16.221 19,851 21.503 22.727 80.302 TOTAL COST A to E (WC Improvements) 418.41 152.29 863.45 930.04 2,964.193 -119 - Table 3 :Improvementof Distributaries Description Quantities Unit Base Costs (Rupees Million) For. Tax Unit Year-1 Year-2 Year-3 Year4 Total CostsRs Year-1 Year-2 Year-3 Year-4 Total Exch Rate A Distributary/Minor canal (FOs Managed) Yo % Nos 10 30 30 30 100 (a) restorationofoutlets, d-silting, restorationof weak sectionsof channel banks andberms (b) repair of regulator gates, cross regulatorsand diversion stnrctures, up-stream anddownstream protection of structures, channel side protection,cattle crossings andcattle ghats (c) Installation of gaugesand control stnrchlres Sub-Total (A) 45.000 135.000 135.000 135.000 450.000 7 5 B. Incremental Staff Equally Distributed in Three AWBs (NCAWB, LBCAWB andGFCAW) AssistantAccountants 6 72 72 72 72 288 10,000 0.720 0.720 0.720 0.720 2.880 Computer Operators 12 144 144 144 144 576 10,000 1.440 1.440 1.440 1.440 5.760 Sub-Engineer 9 108 108 108 108 432 10,000 1.080 1.080 1.080 1.080 4.320 Quantity Surveyors 9 108 108 108 108 432 10,000 1.080 1,080 1.080 1.080 4.320 Casual Labor 90 1080 1080 1080 1080 4,320 3,000 3.240 3.240 3.240 3.240 12.960 Driver 9 108 108 108 108 432 4,000 0.432 0.432 0.432 0.432 1.728 Provision for Annual Increments 0.559 0.599 1.799 Sub total - B(Incre --0.641 Staff AWBs) 7.992 8.551 8.591 8.633 33.767 0 5 C Equipment Computers (PentiumIV) Nos 12 - - 12 50,000 0.600 - 0.600 Laser Printers Nos 6 - - 6 30,000 0.180 - 0.180 Computers(Pentium 111) Nos 6 - - 6 15,000 0.090 -.- - 0.090 Computer Software Lump sum 0.050 0.050 Printer Ink Jet A4 Size 6 - - 6 10,000 0.060 . - 0.060 Printer Ink Jet A3 Size 1 - - 1 18,000 0.018 . - 0.018 ~ UPS Nos 12 - - 12 10,000 0.120 0.120 ~ Thiodolite with Metallic Tripod & 3 PieceAluminum StaffRod Nos 3 - - 3 200,000 0.600 - - 0.600 PhotocopierMachine Nos 6 - - 6 150,000 0.900 - - 0.900 Stabilizer Nos 6 - - 6 8,000 0.048 - - 0.048 Facsimile Machine Nos 6 - - 6 20,000 0.120 - - 0.120 Air conditioners (Window Type) Nos 3 - - 3 25,000 0.075 - 0.075 ~ RangePoles Nos 75 25 - - 100 400 0.030 0.010 - - 0.040 MeasuringTape (Fr Glass) 30 M Nos 19 - - 19 500 0.010 - - 0,010 Chain Rods Nos 16 - 16 - ~ 3,000 0.048 - 0,048 Furniture & Fixture Lumpsum 0.400 - 0.400 Sub total (Equipment Dist Imp) 3.349 0.010 - -- 3.359 20 20 - 120 - Table 3 :Continued D Vehicles S Cabin Stand4x2 for 3 AWBs Nos 3 - - 3 800,000 2.400 - 2.400 30 50 ~ E RecurringCosts 1 POL (4- Wheels) V Months 36 36 36 36 144 12,000 0.432 0.432 0.432 0.432 1.728 2 Stationary Lumpsum 0.050 0.050 0.050 0.050 0.200 3 ComputerSupplies Lumpsum 0.050 0.050 0.050 0.050 0.200 4 Travel Allowance Lumpsum 0,100 0.115 0,132 0.152 0.499 Provisionfor advertisements,walk through,photocopies, bindingetc. 0,638 1.808 1.808 1.808 6.060 Sub Total (Recurring Costs) 1.270 2.455 2.472 2.492 8.687 7 3 TOTAL COST (Dist Improvement) 60.010 146.016 146.062 146.124 498.212 -121 - Table4 :Improvementsof BranchCanals Description Quantities Unit Base Costs(Rupees Million) For. Gross Unit Year-I Year-2 Year-3 Year4 Total Costs Rs Year-1 Year-2 Year-3 Year-4 Total Exch Tax A Improvement o f Branch Canal % % (a) restorationof outlets, d- silting, restorationof weak sectionsof channel banks andberms (b) repair ofregulator gates, cross regulatorsanddiversion structures, upstream anddownstream protection of structures,channel side protection,cattle crossingsand cattle ghats (c) Installation o f gaugesand control Structures. (d) Motorizationof regular gates (e) Installation oftelecommunication System 0% 28% 32% 40% Sub Total (B CanalsImp) 0 7 8 I O 25 - 56.000 64.000 80.000 200.000 7 10 B Equipment Computers(Pentium IV) Nos 4 - - 4 50,000 0.200 - 0.200 ~ Laser Printers Nos 2 - - 2 30,000 0.060 - 0.060 Computers (Pentium 111) Nos 2 - 2 15,000 0.030 -- - 0,030 ~ ~ Printer Ink Jet A4 Size Nos 3 - - 3 10,000 0.030 - 0.030 PrinterInk Jet A3 Size Nos 1 - - I 18,000 0.018 - - 0.018 UPS Nos 4 - 4 10,000 0.040 - 0.040 ~ ~ ComputerSoftware Lsm Lsum 0.050 - - - 0.050 ~ Scanners Nos 1 - - 1 10,000 0.010 - 0.010 Tape/Rods/Chain Sets Nos 3 - - 3 3,000 0.009 - - 0.009 PhotocopierMachine Nos 2 - 150,000 0.300 - 0.300 ~ 2 ~ Stabilizer Nos 2 - - 2 8,000 0.016 - - 0.016 FacsimileMachine Nos 2 - - 2 20,000 0.040 - - 0.040 Air conditioners(W Type) Nos 5 - - 5 25,000 0.125 - - 0.125 Auto Level with Metallic Tripod & 3 PieceAluminum StaffRod Nos 5 5 6 - 16 100,000 0.500 0.500 0,600 1.600 ~ CommunicationSystemfor CanaUDsitibutaries Ls LS - - 2.000 - 2.000 Furniture& Fixture LS -- LS 0.140 - 0.140 Sub total 1.568 0.500 2.600 -- 4.668 20 20 D Vehicles S Cabin Std 4x2 for 3 AWBs Nos 6 6 800,000 4.800 4.800 30 50 ~ E RecurringCosts POL (4-Wheel) VMonths 72 72 72 72 288 12,000 0.864 0.864 0.864 0.864 3.456 Stationary LS 0.050 0.052 0.053 0.055 0.209 ComputerSupplies LS 0.041 0.042 0.043 0.044 0.169 Travel Allowance LS 0.075 0,077 0.080 0.082 0,314 Sub Total 1.030 1.034 1.040 1.045 4.148 3 3 TOTAL COST (Br Canal) 7.398 57.534 67.640 81.045 213.616 - 122 - Table 5: Productivity Enhancement Quantities Unit BaseCosts (RupeesMillion) Forgn. Gross Unit Year-1 Year-2 Year-3 Year4 Total CostsRs Year-1 Year-2 Year-3 Year-4 Total Exchh TaxRate% A Disseminationof Information DemonstrationCenters Nos. - 50 50 - 100 125,000 - 6.250 6.250 - 12.500 0 0 Distribution of Literature - Lumpsum 0.050 0.050 0.050 0.050 0.200 3 3 PrecisionLand Leveling Ha 3,000 8,000 14,000 15,000 40,000 3,400 9.900 27.150 47.550 50.950 135.550 0 1 Developmentof Web Site - Lumpsum 0.300 0.050 0,050 0.050 0.450 3 3 Pilots for Water Info Kiosks &Volumetric Delively - Lumpsum - 0.100 0.200 - 0.300 0 0 Sub Total (A) 10.250 33.600 54.100 51.050 149.000 B Project Allowance for Existing District Teams 1/ (a) Asst AgronomisWMO (Agri) 4 48 48 48 48 192 BPS-I7 0.100 0.102 0.105 0.107 0.415 li Restof the team membersare placedunder Social Mobilization (b) Incremental Staff SystemAnalyst for Kiosks 6 24 72 72 168 Contract - 0.528 1.695 1,814 4.036 ComputerOperatorsfor Kiosks 6 24 72 72 168 Contract 0.238 0.763 0.816 1.816 ~ Incremental Salaries (a+b) 0.100 0.868 2.562 2.737 6.267 0 5 C Training of Laser Operators Training of LaserOperators Nos 60 80 80 80 300 6,500 0.390 0.520 0.520 0.520 1.950 Up gradationof SkrandInsti& Refresher Courses Lump sum 3.777 3.777 Sub Total(C) 4.167 0.520 0.520 0.520 5.727 0 0 I) Integrated Pest & Nutrient Management IPMthrough TofffFS - 500 3,000 7,000 - 0.655 3.930 9.170 13.755 0 0 IPNSM Demo. Plots - 0.500 1.250 0.750 2.500 3 3 AwamnessRaisinflissemination of Information 1.632 1.632 1.632 1.632 6.528 3 3 Monitoring PesticideResidue 75 75 75 75 0.525 0.525 0,525 0.525 2.100 0 0 Vehicles 1 3 - - 4 1.500 4.500 - 6.000 30 50 Repairofvehicles and POL 0.200 0.500 0.500 0.500 1.700 7 5 Training and Studies 0.100 0.200 - 0.200 0.500 0 0 Sub total @) 3.957 8.512 7.837 12.777 33.083 E Equipment Computers(P-111) Nos 32 18 - 15,000 0.480 0.270 ~ 50 0.750 Manual Typewriters Nos 32 18 -- 50 15,000 0.480 0.270 0.750 Printer Ink Jet A4 Size Nos 32 18 - 50 10,000 0,320 0,180 0.500 Survey Kit (Consult) Nos 4 - - -- 4 100,000 0.400 ~ 0.400 Survey Kit (OFWM) Nos 38 28 - - 66 100,000 3,800 2.800 6.600 Flow MeasurementDevice Nos 8 10 - - 18 50,000 0.400 0.500 0.900 Current Meters Nos 2 - - 2 200,000 0.400 - 0.400 Flumes Nos 2 5 3 - 10 15,000 0.030 0.075 0.045 ~ 0.150 SprinkledDrip Equipment Nos 3 3 4 10 200,000 - 0,600 0.600 0.800 2.000 Laser Leveling Set for FOs Nos 30 50 70 150 500,000 15.000 25.000 35.000 - ~ 75.000 Laser Set for Training Nos 2 - - 2 500,000 1.000 - 1.000 Furniture & Fixture Lumpsum 0.200 - - 0.200 Sub total (E) 22.510 29.695 35.645 0.800 88.650 20 20 - 123- Table 5: Continued F Vehicles Pick-Up DCabin4 X 2 Loaded Nos 1 - 1 2,125,000 2.125 - 2,125 ~ Pick-Up S Cabin 4 X 2 Standard Nos 1 - 1 800,000 0.800 -- - 0.800 ~ Motorcycles(70 cc) for Kiosks Nos - 2 4 - 6 60,000 - 0.120 0,240 - 0.360 Motorcycles(70 cc) Nos 5 - - 5 60,000 0.300 - 0.300 Sub Total (F) 3.225 0.120 0.240 -- 3.585 30 50 G RecurringCosts Lumpsum 0.480 0.504 0.529 0.556 2.069 7 3 TOTAL COST(Productivity Enh) 44.689 73.819 101.434 68.440 288.381 -124 - Table 6 :Monitoring and Evaluation Description Quantities Unit BaseCosts (Rupees Million) Forgn Gross UniUNo Year-I Year-2 Year-3 Year4 Total Costs Rs Year-1 Year-2 Year-3 Year4 Total Exch Tax A.M&EConsultants -(Core Team) % % Team Leader(M&E) I 12 12 12 12 48 100,000 1.200 1.200 1.200 1.200 4.800 SocialiPoverty Monitg Sp 1 4 2 2 4 12 80,000 0.320 0.160 0.160 0.320 0.960 Ag. Economist I 3 3 3 3 12 80,000 0.240 0.240 0.240 0.240 0.960 Irrigation Engineer 1 6 6 6 6 24 80,000 0.480 0.480 0.480 0.480 1.920 Jr. Agronomist 1 12 12 12 12 48 30,000 0.360 0.360 0.360 0.360 1.440 Environ. Monitg. Specialist 1 2 2 2 2 8 900,000 1.800 1.800 1.800 1.800 7.200 Short Term Specialist 1 2 - - 2 4 90,000 0.180 - - 0.180 0.360 GIS andInfo Manag Sp 1 9 3 3 3 18 90,000 0.810 0.270 0.270 0.270 1.620 Other SupportStaff 0.809 0.677 0.677 0.728 2.889 Provision for Annual Increments 0.363 0.388 0,447 1.199 Remote Sensing(imageries & interpretation) 4.350 4.350 4.350 4.350 17.400 B. Field Teams - 4 Nos CiviliAgriculture Engineers 3 36 36 36 36 144 35,000 1.260 1.260 1.260 1.260 5.040 FieldInvestigators 6 72 72 72 72 288 30,000 2.160 2.160 2.160 2.160 8.640 Other Support Staff 0.34 0.34 0.34 0.34 1.368 Provision for Annual Increments 0.26 0.28 0.30 0,847 Total Staff Costs (A+B) 14.311 13.925 13.969 14.438 56.642 18 10 C. Equipment (Core +FieldTeam) Computers(Pentium IV) Nos 7 - - 7 50,000 0.350 - - 0.350 Laser Printers Nos 6 - 6 30,000 0.180 - - 0.180 ~ Scanners(A3) Nos 2 - - 2 22,000 0.044 - - 0.044 ComputerSoftware - Lumpsum 0.075 - 0.075 ~ GISEquipment & Software - Lumpsum 2.500 - - 2.500 PhotocopierMachine Nos 5 - 5 150,000 0.750 - 0.750 ~ Air conditioners (W Type) Nos 2 4 - - 6 25,000 0.050 0.100 - 0.150 FacsimileMachine Nos 5 - 5 20,000 0.100 - 0.100 Furniture &Fixture Lump sum 0.140 -- - 0.140 Sub total (C - Equipment for M&E) 4.189 0.100 - 4.289 20 20 D. Vehicles (Core Team +FieldTeam) Pick-Up S Cabin 4x2 - AC Nos 10 - - 10 850,000 8.500 - - 8.500 Pick-Up DCabin4x2 Loaded Nos 1 - 1 2,125,000 2.125 - - 2.125 Motorcycles (70 cc) Nos 4 - 4 60,000 0.240 - 0.240 Sub Total (D Vehicles for M&E) - 10.865 - -- 10.865 30 50 E. Recurring Costs (Core + Field Teams) Rental(Hyderabad& FieldOffices) 0.720 0.720 0.720 0.720 2.880 POL (4 Wheels) 1.800 1.800 1.800 1.800 7.200 POL (Motorcycles) 0.132 0.132 0.132 0.132 0.528 Repair & Maintenance 0.748 0.754 0.754 0.754 3.011 Stationary 0.603 0.575 0,577 0.600 2.355 Computer Supplies 0.497 0.476 0.478 0.496 1.948 Travel Allowance 0.286 0.278 0.279 0.289 1.133 Utilities (Elect, Tele, Gas Etc.) 0.660 -0.660-2.640 0.660 -0.660 Sub Total (ERec Costs-M&E) 5.446 5.397 5.401 5.451 21.695 7 3 TOTAL COST (M&E) 34.810 19.422 19.370 19.889 93.491 -125 - Table 7: Project ManagementSupport Description Quantities Unit BaseCosts (Rupees Million) Foreign Gross UnitNoYear-1 Year-2 Year-3 Year-4 Total RateRs Year-l Year-2 Year-3 Year4 Total Exch Tax 1 PIA Consultants (Core Team) % % (a) PIA Staff TeamLeader(PMSupp0rt) 1 12 12 12 12 48 100,000 1.200 1.200 1.200 1.200 4.800 Sr. EngineerDesign 1 12 12 9 - 33 80,000 0.960 0,960 0.720 - 2.640 Financial Management Specialist 1 12 12 12 12 48 90,000 1.080 1.080 1.080 1.080 4.320 Procurement andContract Engineer I 12 12 12 12 48 90,000 1.080 1.080 1.080 1.080 4.320 Jr. Engineercoordination 1 12 12 12 12 48 35,000 0.420 0.420 0.420 0.420 1.680 Environmental Specialist 1 6 3 3 3 15 900,000 5.400 2.700 2.700 2.700 13,500 Productivity Enhancement Special 1 6 6 6 6 24 90,000 0.540 0.540 0.540 0.540 2.160 Training Specialist 1 6 3 3 12 90,000 0.540 0.270 0.270 - 1.080 ~ S. MobiIizatiodGender Sp. (Lady Coordinator) 1 9 12 6 - 27 80,000 0.720 0.960 0.480 - 2.160 Other Suppolt Staff 1.791 1.382 1.274 1.053 5.499 Provision for Annual Increments - 0.741 0.731 0.647 2.120 SubTotal (PIA Staff) 13.731 11.333 10.495 8.720 44.279 (b) Field Teams 4 Nos FieldTeam In-charge 4 36 48 48 48 180 75,000 2.700 3.600 3.600 3,600 13.500 Junior EngineerIrrigation 4 24 48 48 48 168 35,000 0.840 1.680 1.680 1.680 5.880 Sr. Eng. Canals 2 12 24 24 24 84 75,000 0.900 1.800 1.800 1.800 6.300 Jr. Eng. Canals 3 18 30 36 36 120 35,000 0.630 1.050 1.260 1.260 4,200 FarmManagement Specialist 2 18 24 24 24 90 75,000 1.350 1.800 1.800 1.800 6.750 ComputerOperator 4 48 48 48 48 192 25,000 1,200 1.200 1.200 1.200 4.800 Other Support Staff 0.762 1.113 1.134 1.134 4.143 Provision for Annual Increments - 0.857 0.934 1.000 2.791 Sub Total (b) 8.382 13.100 13.408 13.474 48.364 Total Staff Costs (aib) 22.113 24.433 23.903 22.194 92.643 27 10 (c) Equipment (Core Staff + Field Stafr) Computers (Pentium 1V) Nos 8 - - 8 50,000 0.400 - - 0.400 Laser Printers Nos 8 - - 8 30,000 0.240 - - 0.240 ComputerSoftware Lumpsum 0.075 - 0.075 PhotocopierMachine Nos 2 - - 2 150,000 0.300 - -- 0.300 Scanners(A3) Nos I - - 1 22,000 0.022 - - 0.022 Facsimile Machine Nos 1 - - 1 20,000 0,020 - - 0.020 Survey Sets Nos 4 - - 4 100,000 0.400 - 0.400 TelephoneExchange Nos 1 - 1 22,000 0.022 -- - 0.022 Airconditioners(W Type) Nos 3 7 - -- 10 25,000 0.075 0.175 - - 0.250 Multimedia Projector Nos 1 - - 1 200,000 0.200 - 0.200 Fumiture & Fixture Lumpsum 0.500 - -- 0.500 SubTotal (Equipment for Consultants) 2.254 0.175 - - 2.429 20 20 -126- Table 7 :Continued (d) Vehiclesfor (Core + Field Teams) Pick-Up D Cabin 4x2 Loaded Nos 2 - - 2 2,125,000 4.250 - - 4.250 Pick-Up S Cabin 4x2 Standard Nos 1 - - - - 1 800,000 0.800 0.800 ~ Pick-Up S Cabin 4x2- AC Nos 5 - 5 850,000 4.250 - 4.250 Car 1300CC FullyLoaded Nos 1 - - I 1,000,000 1.000 -- 1.000 Motorcycles (70 cc) Nos 5 - - 5 60,000 0.300 -- - 0.300 Sub Total (Vehicles for PIA Consultants) 10.600 - - 10.600 30 50 (e) Recurring Costs for (Core + FieldTeams) Rental(Hyderabad& Field Offices) Months 60 60 60 60 240 1.080 1.080 1.080 1.080 4.320 POL(4-Wheels) 1.620 1.620 1.620 1.620 6.480 POL (Motor Cycles) 0,150 0.150 0.150 0.150 0.600 Repair& Maintenance 0.643 0.651 0.651 0.65 1 2,597 Stationary 0.115 0.089 0,086 0.077 0.368 ComputerSupplies 0.231 0.179 0.172 0.155 0.736 Travel Allowance 0.923 0.715 0.688 0.618 2.944 Utilities (Electricity, Telephone, Gas Etc.) 0,720 0.720 0.720 -2.880 0.720 Sub Total (Recurring CostsPIA Consultants) 5.482 5.205 5.167 5.072 20.926 3 3 TOTAL COST OF PIA CONSULTANTS 40.449 29.813 29.070 27.265 126.597 2Project Coordination Unit(PCU) IncrementalStaff 0.784 0.636 0.637 0.639 2.696 0 5 Equipment 1.391 - 1.391 20 20 Vehicles 4.000 -- - 4.000 30 50 RecurringCosts 1.413 1.060 1.060 1.060 4.593 3 3 Sub Total (PC Unit) 7.588 1.696 1.697 1.699 12.680 3 InternalAudit IncrementalStaff 1.260 1.156 1.161 1.167 4.743 0 5 Equipment 0,135 - 0.135 20 20 Vehicles 0.120 -- 0.120 30 50 ~ RecurringCosts 0.288 0.288 0.288 0.288 1.152 3 3 Sub Total (Internal Audit) 1.803 1.444 1.449 1.455 6.150 4DGAEWM Incremental Staff DeputyDirector(Coord) 1 12 12 12 12 48 BPS18 0.203 0.210 0.217 0.224 0.854 PlanningOfficer 1 12 12 12 12 48 BPS17 0.158 0.164 0.169 0.175 0.666 Account Officer I 12 12 12 12 48 BPS17 0.116 0.120 0.124 0.127 0.487 Computeroperator. 2 24 24 24 24 96 BPS15 0.206 0.212 0.219 0.225 0.862 Regular and SpecialAllowances 1.066 1.092 1.117 1.143 4.418 Sub-Total 1.749 1.798 1.846 1.894 7.288 0 5 - 127 - Table 7 :Continued Equipment for DGAEWM - Computers (Pentium1V) Nos 2 - 2 50,000 0.100 - 0.100 Laptops(Pentium IV) Nos 1 - 1 110,000 0.110 0.110 ~ ComputerSoftware LS - LS 0.018 - 0.018 Computers (Pentium111) Nos 2 - 2 15,000 0.030 - 0.030 LaserPrinters Nos 3 - 3 30,000 0.090 - 0.090 PrinterInk Ject A3 Size Nos I - 1 18,000 0.018 - 0,018 PrinterInkJet A4 Size Nos 2 - 2 10,000 0.020 - 0.020 Scanners Nos 1 - 1 10,000 0.010 0.010 ~ UPS Nos 4 - 4 10,000 0.040 0.040 ~ PhotocopierMachine Nos 1 - 1 150,000 0.150 - 0.150 FacsimileMachine Nos 1 - I 20,000 0.020 - 0.020 Audio Visual Equipment Nos 2 - 2 200,000 0.400 0.400 ~ Audio (Conference) Addressing System Nos 1 - 1 425,000 0.425 0.425 ~ Television Nos 1 - 1 20,000 0.020 -- 0.020 Stabilizers Nos 4 - 4 8,000 0.032 - 0.032 Air conditioners (W Type) Nos 2 - 2 25,000 0.050 --- 0.050 ~ Air conditioners Split Type Nos 2 - 2 42,000 0.084 - - 0.084 PortableGenerator Nos 1 - 1 32,000 0.032 - - 0.032 Spiral BindingMachine Nos 1 - 1 30,000 0.030 - - 0.030 Furniture& Fixture LS 0.400 - 0.400 Sub-Total (Equipment for DGAEWM) 2.079 - -- 2.079 20 20 Vehicles for DGAEWM Office Car 1300CC FullyLoaded Nos 1 - 1 1,000,000 1.000 - - 1.000 Jeep Diesel(2000 to 2200 cc) 4 x 4 Nos 1 - 1 1,600,000 1,600 1.600 30 50 Sub Total (Vehicles for DGAEWM) 2.600 -- -- 2.600 RecurringCosts for DGAE&WM 2.516 1.990 2.129 2.252 8.887 3 3 5 SIDA FMCosts Incremental Staff 1.874 2.247 2.257 2.268 8.647 0 5 Equipment 0.180 - - 0.180 20 20 RecurringCosts 0.240 0.240 0.240 0.240 0.960 3 3 Sub Total (SIDA FMCosts) 2.294 2.487 2.497 2.508 9.787 6 DGAE&WM FMCosts IncrementalStaff 1.330 1.220 1.225 1.231 5.007 0 5 Equipment 0.300 - - 0.300 20 20 RecurringCosts 0.300 0.300 0.300 0.300 1.200 3 3 Sub Total (DGAEWM FMCosts) 1.930 1.520 1.525 1.531 6.507 1Provisionfor OutsourcedContracts PreparationofFinancialManual 0.150 - - 0.150 0 5 Survey& DesignContracts 5.000 - - 5.000 0 5 Sub Total 5.150 - - 5.150 Grand Total P M Support 68.158 40.747 40.214 38.606 187.725 -128 - Table 8: FinancialManagementSupport Group MillionRupees S Personi Year-1 Year-2 Year-3 Year-4 TOTAL Unit Year-1 Year-2 Year-3 Year-4 Total Units costs Rs A. DGAEWM Incremental Staff Senior Accountant 1 14 12 12 12 50 45,000 0.630 0.540 0.540 0.540 2.250 Accountant 1 14 12 12 12 50 20,000 0.280 0.240 0.240 0.240 1.000 JuniorAccountants 3 42 36 36 36 150 10,000 0.420 0.360 0.360 0.360 1.500 Provision for Annual Increment - 0.080 0.085 0.091 0.257 Sub Total 1.330 1.220 1.225 1.231 5.007 Equipment Computerand Printers Nos 5 0 0 0 5 45000 0.225 0.225 ~ ~ FurnitureiFixtures 0 0 0 0 - Lumpsum 0.075 0 0 0 0.075 SubTotal 0.300 - - 0.300 RecurringCosts Operation& Maintenance 0 0 0 0 Lumpsum 0.3 0.3 0.3 0.3 1.200 Total (DGAEWM) 1.930 1.520 1.525 1.531 6.507 B INTERNAL AUDIT Senior Auditor (Internal Audit) 1 14 12 12 12 50 50,000 0.700 0.600 0.600 0.600 2.500 Auditors (Internal Audit) 2 28 24 24 24 100 20,000 0.560 0.480 0.480 0.480 2.000 Provisionfor Annual Increment . 0.076 0.081 0.087 0.243 Sub Total 1.260 1.156 1.161 1.167 4.743 Equipment ComputerandPrinten Nos/Sets 2 2 45,000 0.090 - 0.090 FurnitureBixtures - Lumpsum 0.045 - -- 0.045 SubTotal 0.135 - - 0.135 Vehicle Motorcycle (Internal Audit) Nos 2 2 60,000 0.120 0.120 ~ Sub Total 0.120 - -- 0.120 RecurringCosts Operation& Maintenance - Lumpsum 0.288 0.288 0.288 0.288 1.152 Sub Total 0.288 0.288 0.288 0.288 1.152 Total (Internal Audit) 1.803 1.444 1.449 1.455 6.150 C. InstitutionalCapacity Buildingfor WCAs and FOs IncrementalStaff Group Leader(FMS Team) 1 12 12 12 12 48 45,000 0.540 0.540 0.540 OS40 2.160 Accountants 6 72 72 72 72 288 20,000 1.440 1.440 1.440 1.440 5.760 Junior Accountants 6 72 72 72 72 288 10,000 0.720 0.720 0.720 0.720 2.880 Provisionfor Annual lncrement - 0.189 0.202 0.216 Sub Total 2.700 2.889 2.902 2.916 11.408 - 129- Table 8: Continued Equipment Computersand Printers Nodsets 7 7 45,000 0,315 - - 0.315 FumitureIFixtures Lumpsum 0.195 - 0.195 Sub Total 0.510 - -- 0.510 Vehicle Motorcycles Nos 12 12 60,000 0.720 - - 0.720 Sub Total 0.720 - - 0.720 Recurring Costs Operation& Maintenance Lump sum 1.248 1.248 1.248 1.248 4,992 Sub Total 1.248 1.248 1.248 1.248 4.992 Total 5.178 4.137 4.150 4.164 17.630 D. SIDA - IncludingCFC Incremental Staff ChiefFinancial Coordinator I 8 12 12 12 44 80,000 0.640 0.960 0.960 0.960 3.520 Senior Accountant 1 14 12 12 12 50 45,000 0.630 0.540 0.540 0.540 2.250 AccountingAssistant 1 14 12 12 12 50 15,000 0.210 0.180 0.180 0.180 0.750 Accounting Assistant I 14 12 12 12 50 10,000 0.140 0.120 0.120 0.120 0.500 Special Allowancefor ChiefFinancialCoordinator 0.128 0.192 0.192 0.192 0,704 Special Allowancefor Senior Accountant 0.126 0.108 0.108 0.108 0.450 Provisionfor Annual Increment - 0.147 0.157 0,168 0.473 Sub Total 1.874 2.247 2.257 2.268 8.647 Equipment Computer& Printers NodSets 3 3 45,000 0.135 - - 0.135 Furniture& Fixture Lumpsum 0.045 - 0.045 Sub Total 0.180 -- - 0.180 RecurringCosts Lumpsum 0.240 0.240 0.240 0.240 0.960 Sub Total 0.240 0.240 0.240 0.240 0.960 Total (SIDA) 2.294 2.487 2.497 2.508 9.787 Total Cost (Financial ManagementGroup) 11.205 9.587 9.622 9.659 40.073 - 130- Table 9 A: Social Mobilization Group Social DevelopmentCell RupeesMillion ir Description UnitMonth UnitCost Rs Year 1 Year 2 Year 3 Year 4 Total IncrementalStaff Group Leader SocialMobilization 1 60,000 0.720 0.720 0.720 0.720 2.880 TrainingCoordinator I 20,000 0.240 0.240 0.240 0.240 0.960 SocialOrganizers 30 16,000 0.480 0.480 0.480 0.480 1.920 Data base Assistants 2 10,000 0.240 0.240 0.240 0.240 0.960 FieldAssistants 6 10,000 0.720 0.720 0.720 0.720 2.880 Office Boys 6 4,000 0.288 0.288 0.288 0.288 1.152 Driven 10 6,000 0.720 0.720 0.720 0.720 2.880 Provisionfor Annual Increment - 0.239 0.255 0.273 0.767 Project Allowance 35,000 0.420 0.420 0.420 0.420 1.680 Sub Total 3.828 4.067 4.083 4.101 16.079 Training Basic Trainings for FOs 100 20,000 0.400 0.700 0.700 0.200 2.000 SpecializedTrainings, Business Plans, IO0 20,000 0.500 0.500 0.500 0.500 2.000 MaterialDevelopmentetc. Sub Total 0.900 1.200 1.200 0.700 4.000 Operational Cost PhoneCharges 5,000 0.060 0.060 0.060 0.060 0.240 Office Supplies 5,000 0,060 0.060 0.060 0.060 0,240 POL(@Rs 12000iMonth) 8 1,152,000 1,152 1.152 1.152 1.152 4.608 POL for Motorcycles 15 1,500 0.270 0.270 0.270 0.270 1.080 Documentation 10,000 0.120 0.120 0.120 0.120 0.480 Accommodatiodhotelcharges 150,000 0.150 0.150 0.150 0.150 0.600 FieldStationCost (Utilities+rent etc) 6 20,000 1,440 1,440 1,440 1.440 5.760 Sub Total 3.252 3.252 3.252 3.252 13.008 Equipment Computers with Printers 7 45,000 0.315 0.315 Laptop 1 110,000 0.110 0.110 Softwarefor FODatabase Lump sum 200,000 0,200 0,200 Computer Accessories Lumpsum 50,000 0.050 0.050 DigitaYStillCamera 7 50,000 0.050 0.050 SpiralBindingMachine 1 30,000 0.030 0.030 Furniture& Fixtures Lump sum 50,000 0.050 0.050 Sub Total 0.805 0.805 Vehicle DoubleCabin4x2 Loaded I 2,125,000 2.125 2.125 MediumFieldJeep 7 700,000 4.900 4.900 Motorcycles 15 60,000 0.900 0.900 Sub Total 7.925 7.925 Total Cost 16.710 8.519 8.535 8.053 41.817 - 131 - Table 9B: Social MobilizationGroup Communication, InformationDissemination& DemandPromotion Quantities Unit MillionRs Sr. Description Unit Year-1 Year-2 Year-3 Year4 TOTAL Cost Rs Year-1 Year-2 Year-3 Year-4 Total A CommunicationUnit SIDA- I IncrementalStaff CommunicationAdvisor I 12 12 12 12 48 50,000 0.600 0.600 0.600 0.600 2.400 InformationKiosk Assistants 3 - 12 36 36 84 10,000 - 0.120 0.360 0.360 0.840 Sub Total 0.600 0.720 0.960 0.960 3.240 I Equipment Computerswith Printers Nos I - - - 1 45,000 0.045 - - - 0.045 ComputerAccessories Lumpsum 0.03 0.030 Digital Camera Nos 1 - - 1 20,000 0.020 - - - -- 0.020 ~ Fax Machine Nos I - - - 1 25,000 0.025 - - 0.025 Sub Total 0.120 - - 0.120 I Vehicle MotorBikes Nos 3 - - - 3 60,000 0.180 - - - 0.180 I Recurring Costs InformationKiosks Nos - 1 3 3 36,000 - 0.036 0.108 0.108 0.252 Series ofawarenessworkshops Nos 12 12 12 12 48 5,000 0.060 0.060 0.060 0.060 0.240 Incentivesfor Columnist 3 3 3 3 3 12 5,000 0.045 0.045 0.045 0,045 0.180 Mobile PhonesCharges Months 12 12 12 12 48 1,500 0.018 0.018 0.018 0.018 0.072 POL for M.Bikes Months 36 36 36 36 144 1,500 0.054 0.054 0.054 0.054 0.216 Operationalcost for Kiosks Months 12 48 84 144 3,000 - 0.036 0.144 0.252 0.432 Sub Total 0.177 0.249 0.429 0.537 1.392 Total Cost (Communication) 1.077 0.969 1.389 1.497 4.932 B Communication Unit DGAgriculture Extension - IncrementalStaff Mobile Van Operator 1 12 12 12 12 48 7,000 0.084 0.084 0.084 0.084 0.336 Van Assistant 1 12 12 12 12 48 4,000 0.048 0.048 0.048 0.048 0.192 Sub Total 0.132 0.132 0.132 0.132 0.528 I Equipment Camcorder Sony DV 250 Nos 1 _ - _ 1 278,250 0.278 - 0.278 DVCamPlayer(Tab1eModel) DBR-45 Nos 1 - - - I 261,375 0.261 - - - 0.261 NonLinearEditing SystemRDX Cord Nos 1 199,500 0.200 - 0.200 CameraTripodwith Connector Plate Nos 99,750 0.100 - - - 0,100 Cordless Mike System(Sewnit) Nos 57,750 0.058 - - - 0.058 Video Studio Lights (SeWnit) Nos 21,000 0.02 1 - - - 0.021 BoomSystem(Sewnit) Nos 10,500 0.011 - - - 0.011 Monitor Nos 42,000 0.042 - - - 0.042 Batteries Nos 31,500 0.063 - 0.063 BatteryCharger Nos 73,500 0.074 - 0.074 MultimediaProjector Nos 367,500 -0.368 - 0.368 SubTotal 1.474 - - - 1.474 - 132 - Table 9B :Continued I Recurring Costs Handbills and Posters Lumpsum 0.425 0.425 0.425 0.425 1.700 Video FilmProduction Lumpsum 0.250 0.250 0.250 0.250 1.000 TV ProgrammedMessages Lumpsum 0.450 0,450 0.450 0.450 1.800 Radio ProgrammedMessages Lumpsum 0.338 0.338 0.338 0.338 1.352 POL for MobileUnits Months 12 12 12 12 48 12,000 0.144 0.144 0.144 0.144 0.576 SubTotal 1.607 1.607 1.607 1.607 6.428 Total Cost (CommunicationDG Extension) 3.213 1.139 1.739 1.739 8.430 -133- -134- MAP SECTION