Document of TIhe World Bank FOR OFFICIAL USE ONLY C R e , t Report No. P-385 8-IN REPORT AND RECOMMEN-DATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED IDA CREDIT IN AN AMOUNT OF SDR 30.6 MILION TO INDIA FOR THE KERALA SOCIAL FORESTRY PROJECT July 11, 1984 This document bas a restricted distributio and may be used by recipients only in the performace of their oIcial duties. Its contents may not otherwise be disclosed withot World Rank authorintion. -ii- CURRENCY EQUIVALENTS (As of June 26, 1984) US$1.00 = Rs 11.205621 Rs 1.00 = US$0.089 Rs 1 million = US$89,000 The US Dollar/Rupee excbange rate is subject to change. Conversions in the Staff Appraisal Report were, except as otherwise noted, made at the rste of US$1 to Rs 11. FISCAL YEAR April 1 - March 31 ABBREVIATIONS CCF - Chief Conservator of Forests GOI - Government of India GOK - Government of Kerala LCB - Local Competitive Bidding MEG - Monitoring and Evaluation Office SAE - Secretariat for Agriculture and Forests SFW - Social Forestry Wing FOR OFFICIL USE ONLY KERALA SOCIAL FORESTRY PROJECT CREDIT AND PROJECT SDU1NAR Borrower: India, acting by its President. Beneficiary: Government of Kerala (GOK). Amount: SDR 30.6 million (US$31.8 million equivalent) Terms: Standard On-lending Terms: From the Goverument of India (GOI) to the Government of Kerala as part of Central assistance to States for development projects on terms and conditions applicable at the time. GOI would bear the foreign exchange risk. Proiect Description: The project would increase supplies of fuelvood, small tizber and poles through the establishment of about 85,000 ha of plantations. It would also execute a pilot program for producing medicinal plants and strengthen the institutional capabilities through provision for training of existing personnel; additional staff; investment in research and addi- tional vehicles and equipment. A wood balance study would also be undertaken. The project faces no major risks. However, wastage of seedlings could occur if the Social Forestry Wing's capacity for distribution is overstretched. The risk would be minimized by an undertaking that GOK would not expand the seedling distribution program without prior consultation with the Association. Since it is intended to use the existing agricultural extension service instead of expanding the extension service of the Department of Forestry, the new approach entails a risk regarding effective coordination. Bovever, GOK has finalized arrangements satisfactory to IDA to ensure effective coordination between the Department of Agriculture and Forestry Department with regard to providing forestry extension services. Furthermore, insect damage could occur on Ailanthus trees. However, effective insecticides are available and extension advice would focus on the potential problem. Thidocument has a resricted distribution and may be used by repents only in the performance of ofeixial duties. Its contents uay not otherwise be didowd without World Dank sutorizatzion -iv- Estimated Cost IJ: (USS millions) Local ForeiJn Total A. Organization and Management 14.4 0.8 15.2 B. Plautation Activities Seedling Production 12.9 1.5 14.4 Large Block Plantations 6.4 0.0 6.4 Small Block Plantations 0.4 - 0.4 Strip Plantations 0.8 - 0.8 Tribal Fuelvood Plantations 0.8 - 0.8 Tribal Medicinal Pilot Scheme 0.1 - 0.1 Plantation Protection 0.3 - 0.3 Sub-total Plantation Activities 21.7 1.5 23.2 C. Extension and Publicity 0.3 0.1 0.4 D. Training 2.1 0.4 2.5 E. Research and Studies 0.1 - 0.1 Total Baseline Costs 38.6 2.8 41.4 Physical Contingencies 2.4 0.2 2.6 Price Contingencies 9.8 0.7 10.5 Total Project Cost 50.8 3.7 54.5 Financina Plan: (USS millions) Local Foreifu Total GOIIGOK 22.7 - 22.7 IDA 28.1 3.7 31.8 Total 50.8 3.7 54.5 ~~== Estimated Disbursements (USS millions) FY85 FY86 FY87 FY88 FY89 FY90 FY91 Annual 2.6 4.6 4.7 5.8 6.0 6.3 1.8 Cumulative 2.6 7.2 11.9 17.7 23.7 30.0 31.8 Rate of Return: About 26%. Appraisal ReDort: No. 5036-IN, dated July 11, 1984. j1 Includes taxes and duties of US$1.5 million equivalent. INTERNATIOTAL DEVELOPMENT ASSOCIATION REPORT AND RECOMMENDAION OF THE PRESIDENT TO THE EXECUITrVE DIRECTORS ON A PROPOSED CREDIT TO MNDIA FOR THE KERALA SOCIAL FORESTRY PROJECT 1. I submit the following report and recommendation on a proposed IDA Credit to India for SDR 30.6 million (US$31.8 million equivalent) on standard IDA terms, to help finance a social forestry project in order to increase supplies of fuelvood, poles and timber to rural and semi-urban areas in the State of Kerala. The proceeds of the Credit would be channeled to the Government of Kerala in accordance with the Government of India's standard terms and arrangements for financing State development projects. The exchange risk would be borne by the Government of India. PART I - THE ECONOMY jJ 2. An economic report, "Situation and Prospects of the Indian Economy - A Medium Term Perspective" (4962-IN, dated April 16, 1984), was distributed to the Executive Directors on April 23, 1984. Country data sheets are attached as Annex 1. Backzround 3. India is a large and diverse country with a population of about 750 million (in mid-1984) and an snnual per capita income of US$260. The economy is dominated by agriculture which employs more than two-thirds of the labor force. However, the land base is not sufficient to provide an adequate livelihood to everyone engaged in agricultural activities, especially those who own little or no land. Growth of value-added in agriculture - 2.2Z since 1950151 - has been slower than growth of industrial value-added (5.3% per annum). As a result, there has been a gradual decline in the share of agriculture in GDP (at factor cost) from 52% in 1950/51 to about 33% in 1981/82, while the share of industry rose from 202 to around 26Z. But industrialization has not been rapid enough to absorb the growing labor force, or to bring about a rapid economic transformation, with significantly higher productivity and income levels. As a result economic grovth has been slow over the past three decades, averaging about 3.6Z per annum since 1950/51. 4. Nevertheless, there has been steady progress, with per capita income rising by about 1.4% per year in the period 1950 to 1980. Despite the large population base and its relatively rapid growth, India has been able to eliminate persistent dependence on foodgrain imports through significant improvements in agricultural production. Savings and investment have increased markedly since 1950/51: the gross national savings rate more than doubled from 10.8Z of GDP (at factor cost) to 22.7Z in 1983/84, while the gross domestic investment rate rose from 12.5% of GDP to 24.8% in 1983/84. Foreign savings (balance of payments deficit on current account) have never I/ Parts I and II of the report are similar to Parts I and II of the President's Report for the National Cooperative Development Corporation III Project (No. P-3833-IN), dated May 30, 1984. -2- financed a major portion of domestic investment: a peak of about 20% was reached during the early 1960s. Currently, foreign savings account for about 8Z of investment. External assistance has been low both as a percentage of GDP and in per capita terms, never rising above 3Z of GDP and averaging below 12 for the past five years. Net use of foreign savings has never risen above 3Z or GDP, and presently stands at 2.1%. 5. Before the 1970s, India placed relatively less emphasis on export promotion and more on import substitution. The volume grovth of exports between 1950/51 and 1969/70 averaged only 2.2% per annum, while the volume growth of imports over the same period was 4.3%. In the early to mid-1970s, however, India's terms of trade, which had remained roughly constant during the 1960s, deteriorated sharply. In response, the Government introduced various policy measures designed to stimulate exports. As a result, the volume of India's exports grew on average about 7.3% per annum for the 1970s as a whole, a performance which demonstrates that sustained rapid growth is possible. While expanding world markets, particularly in the nearby Middle East, contributed to this growth, liberalized access to imported inputs and more effective export incentives played a major role. 6. Moving into the second half of the 1970s, the Indian economy was buoyed by higher levels of investment and an expanding level of foodgrain output. As a result, growth in real GDP and in agricultural and industrial value-added substantially exceeded the historical 30-year trends (paragraph 3) averaging 5.3%, 3.3% and 8.1%, respectively, during the 1975/76 to 1978/79 period. In 1979/80, however, this momentum was broken when the worst drought in recent years, combined with a doubling of international oil prices and domestic supply shortages, led to a sharp fall in foodgrain production, a decline in GDP, and the opening up of a relatively large trade deficit. Severe inflationary pressures also emerged after several years of virtual price stability. These setbacks coincided with the preparation of the Sixth Five-Year Plan which laid down a program of adjustment that aimed at improving the trade deficit, removing infrastructural bottlenecks and ensuring price stability with an overall growth of the economy of 5.2% per annum. Recent Trends 7. Despite the effects of two severe droughts in 1979/80 and 1982/83, India's economy in the early 1980s continued to grow at the faster pace of the second half of the 1970s. Between the two droughts (from 1979/80 to 1982/83), GDP growth averaged almost 5% per annum, while between the two recovery years (from 198C!81 to 1983/84), it was 4.5% per annum -- substan- tially higher than India's long-term growth rate of 3.6%. Continued rapid economic growth has resulted from a development strategy which includes higher investment levels and liberalizee policies on imports, industrial 'icensing, prices, and commercial borrowing. These policies, by easing constraints on the supply of infrastructure and basic commodities, were 3 determining factor in the improved performance of the economy and the industrial sector. This overall improvement in performance, combined with a more restrictive monetary policy in 1981/82 anid 1982!83, resulted in a sharp decline in the rate of inflation. The growth rate of wholesale prices declined from over 18% in 1980/81 to only 2.6% in 1982/83, but rose to over -3- 9Z in 1983/84, mainly due to the effect of the 1982183 drq5zht on food prices. Further improvements in the policy envirouwent will be required to maintain these higher levels of economic growth and investment without put- ting undue pressure on the balance of payments or reviving inflationary expectations. 8. Economic growth in the' early 1980. has not been steady, reflecti'g the uneven rainfall during the period. In 1980/81 and 1981182, the economy substantially recovered from the 1979 drought, with real CDP growing by 7.6Z and 5.3X, respectively. While industrial output expanded by 41 in 1980181 and 8.6Z in 1981182, recovery was particularly robust in agriculture where normal weather helped output to rise by more than 15Z and 5.5Z, respectively. The supply of power, coal, and rail transport, already improved in 1980/81, was further expanded in 1981182, recording growth rates of about 101, 9.6Z and 12.5S, respectively. This overall improvement in the Indian economy was halted in 1982/83 by a severe drought in aid-1982 which reduced agricultural production by 4Z, brought down the GDP growth rate to 1.8Z, and put further strains on the already difficult balance of payments and domestic resource situation. The timely implementation of various economic policies relating to foodgrain imports, procurement and distribution, and the allocation of power to irrigation pumps mitigated the otherwise very distressing effects of the poor monsoon. The economy recovered ia 1983/84, led by a robust agricul- tural sector - GDP grew by about 6.51 to 7Z with agricultural production growth in the 91-10% rsage and industrial growth of 4.5x. The major factors- contributing to the good economic performance during 1983/84 were the excel- lent monsoon, combined with adequate agricultural policies and programs, and satisfactory performance of the coal and transport sectors. The power sector, however, emerged again as a constraint on higher growth, especially in industry. 9. Agricultural production rebounded strongly in 1983184 in response to the monsoon, improved use of inputs and continued expansion of irrigation. Overall fooagrain production rose by 10Z-121 over the previous year, reaching a new record of 142-144 million tons, a substantial increase over the pre- vious peak of 133 million tons in 1981/82. Corrected for weather variations, foodgrain production continues to grow at a trend of 2.6Z per annumr- sufficient to maintain a broad balance between supply and steadily increasing domestic demand. Nonetheless, the balance remains delicate, and the need for foodgrain imports to saintnin consumer supplies or adequate buffer stocks could arise from time to time. Thus, adequate management of foodgrain stocks and programs to expand irrigation, strengthen extension and encourage the efficient use of other agricultural inputs continue to receive high priority. 10. Basic infrastructure services had a mixzed performance in 1983184, partially because of sluggish demand from industry during the first half of the year but also due to a failure to maintain the productivity gains of 1980-82. Electricity generation grew only by about 3.7X due to low reservoir water levels during the first half of the year, delays in the commissioning of new capacity, and a deterioration of capacity utilization in thrrmal plants. As a result, power generation was about 11.5X below requirements and constituted a maior bottleneck in the economy. Key industries which were adversely affected by power constraints included steel, fertilizers, cement, and coal. To improve performance in the pover sector, the Government recently increased incentives for higher labor and managment productivity in thermal plants. Railway freight traffic, measured in ton-ims, grew by only -4- 0.5% in 1983/84, reflecting sluggish demand. Coal production increased by about 6.5Z in 1983/84 reaching 139 million tons. When combied with stocks already available this level of productiou was sufficient to meet the rela- tively slov demand growth. Infrastructural constraints would have emerged much more sharply had the pace of industriaj growth and demand been more rapid. It is therefore critically important that India maintain the pace of investment in these key sectors,,mobilize sufficient resources to do so, and implement programs to enhance productivity. 11. The Indian economy has reverted from a situation of resource surplus in the late 1970s to an aggregate resource deficit. The gap between gross investment and national savings increased from negligible levels during the late 1970s to an average equivalent to 2.1% of GDP in 1980-84. India's gross national savings rate, which averaged 22.6% of GDP in the last four years, is high by any standard, particularly considering India's low income and the large proportion of its population below the poverty line. The scope for a substantial increase in the savings rate is therefore quite limited. If India is to maintain investment at about 25% of GDP, a major effort will be required to raise additional domestic resources particularly in the public sector. Future increases in savings will depend heavily upon the enhanced profitability of public sector enterprises which would require better utilization of capacity, more efficient operations and adequate pricing policies. This would also allow a marginal decline in the use of foreign savings from the recent 2.1%-2.3Z of GDP to 1.5Z-l.8%, to ensure a sus- tainable external debt service burden. 12. India's external resource position has changed notably since the late 1970s. The current account balance, which recorded surpluses from 1976/77 to 1978/79, reverted to deficits averaging US$3.5 billion and 2.1X of GDP during 1980/81 to 1983/84. Several developments contributed to these relatively larger current account deficits. First, the terms of trade deteriorated sharply in 1979/80 due to the second round of oil price increases and con- tinued to move against India during the first three years of the 1980s. Second, a more liberal import policy towards industrial inputs was pursued. Third, net invisibles declined as travel receipts fell off, workers' remit- tances stagnated (reflecting slower development activity in the Middle East), and payment of interest on higher levels of foreign debt increased. Faced with severe infrastructural constraints and a deterioration in its balance of payments, India initiated an adjustment program in 1980/81 designed to raise the growth rate from its historical level of 3.6Z to 5.22 while adjusting the country's external balance to the adverse price developments in the world markets. The main elements of this strategy are export promotion, import substitution where economically justifiable, implementation of a coherent energy pqlicy designed to meet the energy needs of the economy while curbing the growth of oil imports, and continued movement toward a more liberal import policy aimed at providing producers with access to inputs for higher capacity utilization, greater efficiency, improved technology and capacity expansion. The program is being successfully implemented, and is leading to substantial improvements. 13. A positive development in India's balance of payments is the reduc- tion in the trade deficit from US$7.7 billion in 1980/81 to US$5.9 billion in 1983/84 despite unfavorable world market conditions and iuport -~~~~~~~~~~~ _ -5- liberalization. Export volume growth and import substitution of oil and petroleum products, metals and fertilizers more than offset the substantial increase in "other" imports. These "other" imports consist mainly of industrial imports and capital goods which historically have been in chronic short su'ply and which are of critical importance to capacity utilization, product quality, and plant mddernization and expansion. A major factor in the decline of the trade deficit was the lower net import bill for petroleum, which dropped from US$6.7 billion in 1980/81 to US$3.4 billion in 1983/84 in response to a successful oil development program that reduced import needs and allowed crude oil exports, which totalled about US$1.5 billion in 1983/84. These structural changes in the balance of payments are to a sig- nificant degree the result of India's development and adjustment efforts over the past three years. It is expected that the balance of payments vill continue to be under strain for the next several years, since the adjustment strategy vill continue to require high levels of imports. 14. Even assuming a favorable export performance, India will need exter- nal capital flows to augment its own resources for the foreseeable future, given the low per capita income level in the country, the already high savings rate, and the import requirement associated with improved growth rates. Faced with a growing need for external capital inflows and stagnation in the availability of concessional assistance, India decided at the start of the Sixth Plan to increase borrowings from the International Monetary Fund (IMF) and commercial banks to substantial levels. In the period covering the fiscal years 1981/82 to 1983184. India drew SDR 3.9 billion from the Extended Fund Facility of the IMF. In addition, India borrowed significant amounts on commercial terms from the Euro-dollar market and increased the use of suzppliers' and export credits. In the period 1980-84, India contracted commercial loans totalling over US$6,000 million and suppliers' credits of over US$1,000 million. The bulk of this borrowing has been used for specific development projects in the public and private sector (mostly for petroleum exploration and development, steel, power, aluminum and shipping). India's favorable debt service position and the nature of its borrowings, for project-related purposes instead of direct balance of payments support, enabled it to tap commercial capital markets at favorable spreads. This larger commercial borrowing and transfer of funds under the arrangement vith the IMF has stemmed the use of foreign exchange reserves which had fallen to less than four months of import coverage in 1981/82. Development Prospects 15. The experience of recent years illustrates that India has the capacity to grow and develop at a more rapid pace. Although the industrial sector is small compared to the size of the economy, it nevertheless is large in absolute terms and has a highly diversified structure, capable of manufac- turing a wide variety of consumer and capital goods. Basic infrastructure - irrigation, railways, telecommunications, power, roads and ports -- is exten- sive compared to many countries, although there is considerable need for additional capacity as well as improvement in the utilization of existing capacity. India also has a wide range of institutions capable of fostering development and is well-endowed with human resources. Finally, India has an extensive natural resource base in terms of land, vater, and minerals (primarily coal and ferrous ores, but also gas and oil). With good economic -6- policies and reasonable access to foreign savings, India has the capability for managing these considerable resources to accelerate its'1ong-term growth. 16. The Government is currently preparing the Seventh Plan which will lay down the development strategy for 1985/86-1989/90. This strategy is expected to continue the emphasis of the Sixth Plan on agriculture, energy development, export promotion, domestic import substitution where economi- cally justifiable and the removal of infrastructural bottlenecks. Overall Sixth Plan performance has been encouraging, with aggregate real investment projected to be about 30X higher than in the period 1975-80-a creditable performance indeed. The Sixth Plan expenditure targets, however, will not be fulfilled as resource mobilization by the public sector will fall short of the financing requirements of planned public investment. Actual aggregate real investment is projected to be about 7Z below the original target for the period 1980-85, private investment being 5Z to 1OZ higher and public invest- ment about 20% lower in real terms than actually projected. In terms of meeting Plan expenditure targets, the performance of the Central Government is considerably better than that of the State Governments. The Central Government's Plan outlays are likely to reach about 80Z to 902 of the original Plan allocation in real terms, while the States' will probably achieve only about 50% of their targets. Bottlenecks in key sectors such as power, transport and irrigation are likely to persist as a consequence of real investment shortfalls relative to original Plan allocations. 17. Although Sixth Plan expenditure targets will not be met, India's capital formation rates have increased from 22.6Z in 1975-80 to 24.7Z of GDP in 1980-84. Recent higher capital formation rates are encouraging for future income growth, but returns to investment have so far been relatively low. Much of this phenomenon relates to India's stage of development, in which a large and groving proportion of investment has been needed to build up basic infrastructure services which have inherently high capital-output ratios. However, there is scope to reduce capital-output ratios through improvements in efficiency. As discussed in greater detail in our recent economic reports, performance in the basic service sectors can be improved through better planning and management, thus leading to higher productivity and capacity utilization throughout the economy. At the same time, programs to expand domestic capacity are vital. In the case of tradeable commodities like coal, steel and cement, this is justified on the grounds of comparative advantage. For sectors such as irrigation, power and transportation, expan- sion of planned capacity in accordance with the requirements of the rest of the economy will be vital for sustained growth. 18. Under the Sixth Plan, India has an ambitious oil development program backed by substantial financial comitment. Performance under the program -has been excellent with real investment and oil production levels running yell ahead of Plan Targets. In 1981, and again in early 1983, resources for exploration and development were raised by successive price increases for domestic crude and products. While the gap between domestic consumption of petroleum and production remains large, India's dependence on oil imports dropped from 63% of consumption in 1979/80 to about 41% in 1983/84 and is expected to decrease to about 33% of consumption by 1984/85. The rapidly expanding level of exploration activity, combined vith the possibilities for accelerated offtake from known fields, offers much encouragement for India's -7- longer-term energy prospects. At the same time, the increases in domestic petroleum prices have helped encourages conservation and slow demand growth. 19. India's development prospects over the next few years will hinge on the extent to which the economy can he brought into both internal and exter- nal balance, while at the same time achieving more rapid growth than in the past. This will require the continuation of the current development strategy which assigns high priority to export promotion, public finance discipline, improvement of economic efficiency, and investment in infrastructure, sup- ported by adequate flows of external borrowing and aid. In the short term, a relatively large level of external borrowing, including an increased emphasis on commercial borrowLing, will be necessary to cope with the balance of pay- ments consequences of such a growth strategy. However, an important element in providing India with the capacity to adjust flexibly will be adequate flows of concessional assistance since India is still a very poor country with a large rural sector and enormous investment requirements for human development and basic infrastructure. Although India is currently in a position to increase borrowing on commercial terms from the very low levels of the past, there are, of course, limits beyond which India will choose to sacrifice growth objectives rather than accept debt on unfavorable or unmanageable terms. The fact that India has been able over the past decade to maintain a rate of growth above the long term trend, despite the poor monsoons of 1979 and 1982, suggests that a more open trade policy and expanded efforts to remove constraints on the growth of productive capacity, supported by adequate mobilization of both foreign and domestic savings, can sustain a rate of growth closer to 5.0% per annum than to the long-run trend of 3.6Z per annum. If the rate of population growth can be brought to below 2.0% per annum, a 5.0% growth rate would mean a doubling of the trend rate of growth of per capita income of 1.4% per annum. Success in these efforts would make a significant difference to the prospects of easing poverty in India. 20. A large and growing population and severe poverty underline the need to accelerate Iadia's development efforts. The 1981 Census indicated there was no decline in the rate of population growth, which remained about 2.2% per annum in the 1970s despite a measurable decline in fertility rates. The population growth rate failed to decline in the past decade due to a reduc- tion in the infant mortality rate and an increase in life expectancy, reflecting larger availability of food and health services. While this is a welcome development, it implies a greater strain on the economy and re- emphasizes the need for continuing efforts to strengthen the health and family planning programs in a broad range of activities and services. These efforts are given high priority in the Sixth Plan, which aims at a rise in the proportion of protected couples in the reproductive age group from its estimated 1979/80 level of about 23% to over 35% by 1984/85. The Government is reviewing its population policy for the Seventh Plan, with indications of a determination to retain the emphasis on the implementation of family planning, health, education and literacy programs aim2d at reducing fertility rates. 21. Reduction of poverty remains the central goal of Indian economic and social policy. More than one-third of the world's poor live in India, and more than 80% of the Indian poor belong to the rural households of landless laborers and small farmers. About 51% of the rural population and 40% of the urban population subsist below the poverty line. Srgnificant reductious in poverty will depend primarily on an acceleration of economic growth, particularly in agriculture, combined with effective implementation of poverty alleviation programs. India's poverty alleviation strategy appropriately recognizes that production-oriented programs, which aim at accelerating the overall pacq of economic growth, and poverty alleviation programs, targetted at those least able to participate in the general growth of the economy, can be mutually reinforcing rather than substituting for each other. Major poverty programs operating on a nationwide basis at present include: the Minimum Needs Program (MNP), the Integrated Rural Development Program (MPDp), and the National Rural Employment Program (NREP). The IRDP and NREP are targeted programs aimed at increasing the incomes of the poor rapidly, either through the transfer of productive assets or direct employment. The MNP, aims at broadening the provision of social infrastruc- ture and basic services which enhance the human capital of the poor and improve living standards. Thes. programs represent a vitally important commitment of the Government to address the needs of the poorest. The scale of the poverty problem in India, combined with the inherent difficulties in implementing poverty programs in any country, imply the need for continued efforts to enhance the effectiveness of these programs. PART II - BANR GROUP OPERATIONS IN INDIA 22. Since 1949, the Bank Group has made 76 loans and 164 development credits to India totalling US$5,183 million and US$12,016 million (both net of cancellation), respectively. Of these amounts, US$1,452 million has been repaid, and US$5,723 million was still undisbursed as of March 31, 1984. Bank Group disbursements to India in the current fiscal year through March 31, 1984 totalled US$1,072 million, representing an increase of about 6 percent over the same period last year. Annes II contains a sumary state- ment of disbursements as of March 31, 1984. 23. Since 1959, IFC bas made 29 comuitments in India totalling US$224 maillion, of which US$32 million has been repaid, US$56 million sold and US$17 million cancelled. Of the balance of US$118 million, US$111 million repre- sents loans and US$7 million equity. A sumary statement of IFC disburse- ments as of March 31, 1984, is also included in Annex II (page 4). 24. The thrust of Bank Group assistance to India has been consistent with the country's development objectives in its support of agriculture, energy and infrastructure. Of particular importance have been investments in irrigation, extension and on-farm development designed to increase agricul- tural productivity, and efforts to improve the availability of basic agricul- tural inputs to farmers through credit, fertilizer, marketing, storage, and seed projects. Major elements of the lending program have also been directed at helping to meet the energy needs of the economy while curbing the grovth of oil imports, and to ease the infrastructure bottlenecks which have hampered economic growth in India, particularly through pover generation and distribution, and railways and telecommunications projects. The Bank Group has also provided financing for a broad range of medium- and small-scale industrial enterprises, primarily in the private sector, through its support of development finance institutions. Recognizing the importauce of improving -g- the ability to satisfy the essential needs of urban and rural populations, the Bank Group has supported nutrition and family planning programs, a rural roads project, as vell as water supply and sewerage and other urban infrastructure projects. 25. This pattern of assistance remains highly relevant, and consonant with Government priorities, as reflected in the Sixth Plan. The continued active involvement of the Bank Group in agriculture, energy and infrastruc- ture development will appropriately contribute to India's adjustment and growth prospects. Irrigation will need continuing support, with emphasis on improved efficiezcy in water conveyance systems to ensure reliable delivery to fazmers' fields. In addition, major investments to develop the large Narmada River basin will be vital to India-s efforts to increase agricultural production. Important complements to these efforts, such as fertilizer production and distribuzion, agricultural credit and extension, will continue to receive support. A continued program of investments aimed at rapidly increasing the domestic supply of energy will clearly be necessary if India is to curb the cost of oil imports and alleviate the critical pover shortages which constrain output in both the agricultural and industrial sectors. Exploitation of oil and gas resources is a central element of this program, which should be supplemented by investments in hydro and thermal power generation, and in the expansion of the transmission and distribution networks. Industrial projects to increase the domestic production of basic commodities, which have been in short supply and which India has a compara- tive advantage in producing, should also receive high priority. Finally, raising the e:ficiency and levels of transportation infrastructure would mitigate a key cons traint to achieving higher levels of economic growth so that further support of the railways and for ports development will be par- ticularly appropriate. 26. The need for a substantial net transfer of external resources in support of the development of India's economy has been a recurrent theme of Bank economic reports and of the discussions within the India Consortium. Thanks in part to the response of the aid co=zmmity, India successfully adjusted to the changed world price situation of the nid-1970s. However, India continues to require a substantial level of foreign assistance both to offset the overall deterioration in the world trade envirozment, and to sustain the relatively higher investment and growth rates achieved during the first four years of the Sixth Plan. As in the past, Bank Group assistance for projects in India should aim to include the financing of local expenditures. India imports relatively few capital goods because of the capacity and competitiveness of the domestic capital goods industry. Consequently, the foreign exchange component tends to be small in most projects. This is particularly the case in such high-priority sectors as agriculture and irrigation. 27. India-s poverty and needs are such that -whenever possible, external capital requirements should be provided on concessional terms. Accordingly, the bulk of the Bank Group assistance to India in the past was provided from IDA. However, IDA lending to India has declined from a peak of US$1.5 bil- lion in 1980 to below US$1 billion since that time, mostly due to funding constraints related to IDA 6. Lower IDA 7 replenishment and uncertainties about IDA 8, coupled with increasing claims for IDA funding from other -10- countries, indicate that the amount of IDA funds available to India is likely to continue declining, even in nominal terns, and will remain small in rela- tion to India's needs for external support. Thus, this requirement for additional assistance vill have to be met, in part, through larger Bank lending. Given its development prospects and policies, India is judged credit-worthy for Bank lending to supplement IDA assistance. A continuation of efforts already undervay to achieve growth in productive capacity, trade expansion, higher levels of savings, foodgrains self-sufficiency and a reduc- tion in the rate of population growth should rebult in continued economic growth and improvement in tue balance of payments. Despite recent setbacks, India's external payments position is still wanageable. The ratio of India-s debt service to the level of exports of goods and services and receipts of current transfers was about 12.9% in 1983/84. Over the next several years this ratio is projected to rise to around 20X and remain around that level through 1995196. As of March 31, 1984, outstanding loans to India held by the Bank totalled US$3,884 million, of which US$2,021 million remain to be disbursed, leaving a net amount outstanding of US$1,863 million. 28. Of the external assistance received by India, the proportion con- tributed by the Bank Group has grown significantly. In 1969170, the Bank Group accounted for 34Z of total commitments, 13Z of gross disbursements, and 12% of net disbursements as compared with 62%, 33Z and 37Z, respectively, in 1983184. On March 31, 1984, India-s outstanding and disbursed external public debt was estimated to be about US$26.9 billion, of which the Bank Group's share was US$9.6 b1llion or 36Z (IDA's US$7.8 billion and IBBD's US$1.8 billion). In 1983184, about 19.0Z of India-s total debt service payments were to the Bank Group. PART III - FORESTRY IN INDIA AND KERAILA Backaround 29. India's forest reserve land covers about 75 N ha, or 23% of total land area, but only about 50% of this designated land is tree covered. One of :he serious problems facing India is the degredation and depletion of its forests, which is causing considerable harm to the environment. Forests have been depleted through uncontrolled lopping and felling of treee for fuel and fodde&. Overgrazing has also taken its toll on young trees and grasslands, further removing the groundcover necessary to protect and replenish the topsoil. Unless the decline in forests and other tree resources is steened, the shortage of fuelvood, timber, poles a-d other forest products will become _ncreasingly critical. 30. A study by the National Council of Applied Economic Research estimated total fuelwood consumption in 1978/79 at 95 N tons (125 H m3) or 62 M tons of coal replacement equivalert. Of this, one-third was in the form of logs, the rest in twigs and branches. In addition, 71 M tons of cowdung were burnt (22 H tons coal rep.acement equivalent). The estimated demnd in the year 2000 would be 200 M m3 without considering any substitution of dung with fuelwood. If 502 of tLe energy consumed by dung burning was substituted by fuelwood, the total fuelwoci demand would be about 230 H m3. For industrial wood, the demand has been estimated at about 27 M m3 in 1980 and 65 M m3 in 2000. The total annual wood demand for the year 2000 is therefore likely to be nearly 300 X m3, equivalent to some 20-30 N ha of mature plantation. Government of India Policies and Social Forestry ProRrams 31. Over the years, GOI has taken an increasingly active role in forestry, which traditionally had been left to private interests and the commercial sector. To meet future fuelvood needs, a Fuelvood Commission Report of 1980 recorxmended a five-fold increase in the current level of social forestry planting. This is reflected in the country's Fifth (1974-79) and Sixth (1980-85) Five-Year Plans, which devoted respectively, 49% and 78% of forestry allccations to social forestry. It 8s expected that about 1.93 N ha of social forestry plantations would be established under the auspices of State forestry programs by the end of 1988, amounting to a total public investment of Rs 5,950 M (US$540 N). Forestry in Kerala 32. Kerala covers 38,663 km2 and is one of the cou atrys smallest States. The State generally enjoys good sunlight, has fertile soils, a plentiful network of water resources, and good rainfall from both the May-August south- west and September-October northeast monsoons. Agroforestry orientation in Kerala is strong. Besides commercially grown tree crops such as coconut and rubber, other trees, including those which provide support for pepper vines or shade for cocoa, cardamom and coffee, compleoent important agricultural crops. In addition, private farmers grow trees like Ailanthus for sale to matchbox/splint and packing case manufacturers, Casuarina for sale as poles, and other species for sale as small timber. 33. Forests cover about 11,239 km2, or 29Z of the Sta:Ces land. The growing stock comprises 167 K m3 of wood, expected to be utilized as follows: 53! fuelvood, 11% plywood, 2Z matchwood, 2 pulpwood and 32% other industrial wood. The increasing difficulty in satisfying local demand for firewood, as well as other uses such as timber and poles, is reflected in the recent rapid price increases for these prodicts. Moreover, the commercial market for vood does not fully reflect the current situation, since non-commercial consump- tion constitutes a major portion of total demand. 34. Decline of Forests. Forested areas have declined for several reasons, and have not been replanted at an adequate rate. Population pres- sures have led to deforestation. Landholdings are quite small (90X of them are under one ha), population density is the highest in India, and Kerala has a population growth rate of about 2.6% per annum. Natural sources of fuel including private trees and agricultural waste, have not increased at the same rate as the population. Formerly productive forest land has been encroached by farmers, submerged following hydro-electric and irrigation works, and redeEignated as wildlife sanctuaries and parks. Moreover, the growing stock available for annual harvesting will further decrease since the Govez-rment of Kerasa (GOK) recently decided, as an environmental measure, to stop clearfelling operations. 35. Fcrest Policy and Organization. GOK aims to protect the existing forests and establish new plantations, and expand the area for tree planta- tion throz_-g farm forestry. It has devoted increasing resouzces to social -12- forestry and has established regulations for protection. GOK's social forestry expenditure vas Rs 0.4 million and Rs 4.5 million under the Fourth Five-Year Plan (1969-74) and the Fifth Five-Year Plan (1974-79), respectively, and it is planned to be Rs 19.6 million under the current Sixth Five-Year Plan (1980-85). 36. Forestry Institutions. The Government Secretariat for Agriculture and Forests (SAF) administers both agriculture and forestry. The Forest Department has four Chief Conservators of Forests (CCF) and one Additional Chief Conservator, each of whom is directly responsible to the Secretary/Agriculture Production Commissioner of the SAF. Two Forestry Training Schools provide a basic training course for Foresters and Rangers. In 1982, GOK established a separate Social Forestry Wing (SFW) in the Forest Department. Currently, the SFW is staffed with a small headquarters staff and very limited field staff. 37. SFW distributed 103 M seedlings for farm forestry, and planted 4,418 ha (on degraded land, block plantations, strip plantations and plots in tribal areas) in 1982-83. SFW nov aims to strengthen its organization in order to improve the survival rates of seedlings, the quality of advice given to farmers and the impact of its programs. 38. Villages are grouped under panchayats, which undertake a vide variety of both compulsory and discretionary duties regarding forestry. In addition to Government agencies, voluntary organizations also are active in Kerala. Many of them have collaborated with the SFW in the distribution of seedlings and in advising farmers on planting. The Bank-s Involvement in Indian Forestry 39. The Bank Group, as well as other donors, including the United States Agency for International Development, the British Overseas Administration and the Swedish International Development Agency, have supported India's program for forestry development. The Bank has financed five social forestry projects in India, one of vhich includes two States: the Uttar Pradesh Social Forestry Project (Credit 925-IN; US$23 million; June 1979); the Gujarat Com0uuity Forestry Project (Credit 961-IN; US$37 million; April 1980); the West Bengal Social Forestry Project (Credit 1178-IN; US$29 million; February 1982); the Jamu and Kashmir and Haryana Social Forestry Project (Credit 1286-IN; US$33 million; September 1982) and the Karnataka Social Forestry (Cr. 1432-IU; US$27 million; February 1984). The recent mid-term reviews of the Uttar Pradesh and Gujarat Social Forestry Projects, and supervision of the social forestry projects generally, indicate good overall progress in implementation. 40. The relative emphasis on different types of plantation components has changed in social forestry projects. Focus is nv on farm forestry, which is less expensive than planting on Government land and it yields higher and more direct benefits to farmers, since farmers take all produce/revenues. Farm forestry performance has exceeded appraisal expectations. Other social forestry components are generally progressing well, except for the self-help village woodlots schemes in which performance is below expectations, mainly due to the inability of village administrations to mobilize adequate funds for development works. -13- PART IV - THE PROJECT Background 41. The project was appraised by a Bank mission which visited India in January/February 1984. Negotiations were held in Washington D.C. in June 1984 with an Indian delegation coordinated by Mr. P. Singh, of the Government of India's Department of Economic Affairs, Ministry of Finance. The Staff Appraisal Report, No 5036-fN, is being distributed to the Executive Directors separately. A Supplementary Data Sheet is attached as Annex III. Project Rationale 42. Kerala, like a number of other Indian States, is experiencing a severe deficit with regard to forest products, especially fuelvood, building poles, small timber and fodder. The deficit is creating social, economic and ecological problems. GOK has devoted substantial resources in order to overcome the problem. However, assistance is needed to (i) adequately expand resource availability for the subsector; (ii) improve project design; (iii) foster family operated nurseries; (iv) implement a pilot program for cultivating medicinal plants; and (v) introduce key institutional changes in order to launch and execute effective social forestry programs. Proiect Obiectives and Description 43. The project's primary objectives are to (i) increase production of fuelvood, small timber poles and fodder; (ii) increase farmers' incomes; (iii) reduce soil erosion and conserve soil moisture; and (iv) strengthen forestry institutions. The project would consist of: (a) forest planting of approximately 85,000 ha; (b) establisbmeut/improvement of nurseries; (c) extension and publicity; (d) training; (e) research and studies; and (f) institution building. Detailed Features Plantation Proaram 44. Farm Forestry (69.200 ha-81% of Total Planting Program Under the Proiect). The project would provide funds for establishing of 69,200 ha of forestry on private farm land through development of additional nurseries and provision of advisory services. For this purpose, GOK would raise and distribute, particularly to small farmers, about 340 million seedlings over a six year project period. A network of small family and school operated nurseries would support this effort. In line vith GOI's policy and in accordance with previous agreements betveen the Bsnk and GOI, only a limited -14- number of seedlings-3,500 Casuarina and 500 for other species, would be distributed to each farm fa;lly free of charge. This is the estimated number of trees required to meet the domestic needs, mainly for fuelvood, of an average family. Seedlings in excess of the free limit would be charged at the full financial cost of production including the cost of trausportation. Farm forestry, which would constitute the largest portion of the plantation program, is expected to be the most beneficial to farmers, and more flexible with regard to species mix and product utilization. 45. Block Plantations (12.000 bha-14Z of Total Planting Program). Funds would be provided under the project to finance establishment of 12,000 ha of block plantations on Government land; 11,000 ha would be in large blocks and 1,000 ha would be in small blocks. Block plantations would produce addi- tional fuelvood and poles on otherwise unproductive land. The pLantations would be established by the SFW. Laborers from nearby villages and some forest guards would be employed for establisbhent, maintenance and harvesting of the plantations. SFW would bear the cost of establishment and maintenance. Hovever, GOK would recover the direct costs by selling forestry produce at Government depots. GOK would finalize arrangements for sale of fuelwood by June 30, 1986 (paragraph 2 of Schedule 2 of the draft Project Agreement). 46. Strip Plantations (2.000 ha-2Z of Total Planting). Under the project SFW would establish plantations along coastal belts, roadsides, railway and canal strips. SFW's role would be the same as under block plantations. The design of strip plantations would take into account the existing land use patterns so as to avoid adverse conflicts between competing needs. 47. Involvement of Tribals (2.100 ha-3Z of Total Planting). Funds would oe provided to enable SFW to extend special assistance to tribals by (i) establishing 2,000 ha of plantations adjacent to tribal communities to produce fuelwood; (ii) establishing, on a pilot basis, 100 ha of medicinal plants to be cultivated by tribals who would market the plants, and increas- ingly assume responsibility for running the operation; and (iii) setting up a limited number of small nurseries to be run by tribals. In addition, tribals would be employed on GOK plantations, and after acquiring forestry skills, progressively take over responsibility for the plantations adjacent to them. 48. Nurseries and Seedlings. The project would provide funds for establishment/improvement of a large number of small nurseries on family holdings, and to a limited extent, on school grounds. SFW already has been operating about 100 small nurseries, and 472 such nurseries are planned for the first year of the project, increasing to 1,055 by the fifth year. Foresters would closely supervise and assist the operators of the small nurseries-contractor operators. SFW would take an agreed number and type of seedlings for distribution and planting from each operator each year. The seedlings would meet agreed quality standards. Farmers would have easier access to seedlings through these nurseries, which would reduce dis.ributiou costs. The nurseries would be a source of income to the families employed to operate them, and vould reduce SFW's costs. The nurseries would also be used as locations for extension advice to farmers. It is expected that SFW would -15- establish about 50 large nurseries of its own. Meanvhile, every August, GOI and GOK would reviev the small nurseries scheme and submit a report to IDA. 49. Extension and Publicity. Given the broad scope of the farm forestry component and the fact that farmers would be responsible for the planting and care of about 340 million seedlings, extension and publicity activities would play an important role in project success. On the field extension side, the Social Forestry Wing would have a relatively small but trained cadre of Rangers and Foresters to take responsibility for farm forestry promotion at key distribution and meeting points. As for follow-up with individual farmers, the existing agricultural extension system (vith nearly 2,000 Village Level Workers making fortnightly visits) would lend valuable assis- tance in reinforcing messages on tree planting to farmers. SFW and Agricultural Extension staff would coordinate social forestry activities, in line with similar trends in other States with Bank-financed projects in both social forestry and the Training and Visit system of agricultural extension. The project would also provide funds to enable SFW to sponsor a variety of extensiou and publicity activities including: Ci) a special promotion by voluntary organizations; (ii) extension and publicity publications and materials; (iii) radio announcements and dissemination of information through newspapers and other news media; (iv) talks and demonstrations at meetings and schools; (v) organizing farmers' rallies and meetings; (vi) tours by publicity vans, and (vii) hiring of a local consultant to prepare an informa- tion and publicity program. 50. Training. The project would provide funds for improving the capacity of the forestry training schools to conduct orientation, basic and inservice training for existing staff in social forestry techniques and extension. In addition, training programs would be developed for voluntary organizations, farmers and other interested parties. Training and accommodation facilities at Walayar and Arippa Forestry Training schools, would be expanded and exist- ing buildings would be renovated. Tender documents, including detailed plans for the first year civil works, would be submitted to IDA and contracts are expected to be let by November 30, 1984. 51. Research and Studies. Funds vould be provided for institutions and individual consultants to undertake research related to social forestry, including tree quality, effective extension and appropriate monitoring and evaluation procedures. Funds would also be provided to finance a wood supply and demand study to be completed by December 31, 1985. Organization and Management 52. The Secretary/Forests, Government Secretariat, would have the overall responsibility for all coordination. However, the CCF/Social Forestry, would have the primary responsibility for project implementation by the SFW. The SFW will include at headquarters, four support divisions: (i) training, extension and publicity; (ii) planning and programming; (iii) monitoring and evaluation; and (iv) finance. Two regional Social Forestry Circles each headed by a Regional Conservator, have been established and would be respon- sible for field operations. -16- 53. The SFW would be strengthened through improved organization, training additional staff and vehicles and equipment. The newly created position of the CCF/Social Forestry has been filled. The positions of Conservator for Training, Extension and Publicity, Conservator for Planning and Progra-ming, Deputy Conservator of Forests for Monitoring and Evaluation and Finance Officer have been sanctioned and filled. The two Regional Conservator posi- tions have been sanctioned and will be filled by December 31, 1984. In addition, 14 positions of District Divisional Conservators of Forests have also been sanctioned. Monitoring and Evaluation 54. The Monitoring anc Evaluation Office (MEO) would monitor progress of project implementation, and undertake an evaluation of the impact of the project, in accordance with the "Operational Guidelines to the Monitoring and Evaluation of Social Forestry in India" formulated by GOI, FAO and IDA. The HEO would carry out a mid-term review after the third year's planting season, and, by March 31, 1987, submit to IDA a report concerning the review (draft Project Agreement, Section 3.02). Cost Recovery 55. The primary objective of the project is to meet critical basic needs of rural and semi-urban people. The Govervment investment associated with the project is seen as part of a rrogram for the uplifting and welfare of the rural population, costs of which traditionally are not recovered from the beneficiaries. However, substantial cost recovery would be made for planta- tions on public lands, by selling the fuelwood and poles produced on such lands. In addition, the costs of seedlings in excess of the free limits would be fully recovered. Moreover, the project would aim at reducing GOK involvement in small nursery operations and thereby gradually divesting itself of a substantial fiscal burden associated with farm forestry development. Project Cost and Financing 56. Total project cost, based on January 1984 prices and projected to July 1984, is estimated at US$54.5 million equivalent, including taxes and duties estimated at US$1.5 million equivalent, or 2.8Z of total project cost. The foreign expenditure component is estimated at US$3.7 million equivalent or 6.8% of the total. Physical contingencies amount to about US$2.6 million or 6.2% or base costs, while price contingencies of about US$10.5 million are based on expected annual price increases for local expenditure of 8X, 7Z, 7Z, 7%, 62, 6Z for the Indian fiscal years 1984-90, and 5%, 8%, 9%, 9%, 9Z, 7%, for foreign expenditures for the same years. 57. The credit of US$31.8 million equivalent would cover about 60Z of total project costs net of duties and taxes. GOI and GOK would contribute the balance of US$22.7 million equivalent, or 40% of the total project cost. Retroactive financing not exceeding US$1.0 million would be provided to cover expenditures incurred after March 31, 1984, for nursery development, advance soilworks for plantations, civil works related to construction of training schools and Trivandrum and regional headquarters, essential vehicles and -17- equipment, incremental staff employed on the 1984 planting operation (paragraph 4 of Schedule 1 of the draft Credit Agreement) and consultancy services for the wood supply and demand study. Procurement 58. All items to be procured under the project would involve local com- petitive bidding (LCB) or force account procedures. Civil vorks (US$10.8 million) would be small and scattered geographically and over time, consisting mainly of simple housing, office and training facilities. Consequently, contracts would be let on the basis of LCB under GOI's proce- dures satisfactory to IDA. If no responsive bids are received due to the small size of the individual contracts, work would be done by force account. Contracts over US$150,000 would be subject to IDA's prior review. Vehicles (US$1.l million) comprising small numbers of several types, would be pur- chased over two years and, would require purchase of locally made vehicles of types already being used by Government departments. Procurement would be under LCB according to Government procedures acceptable to IDA. Imported research and other technical equipment (US$0.2 million) would be specialized, proprietory, required in small quantities, and therefore, would not be suitable for international competitive bidding. These items, together with other equipment, materials and furniture would be bulked wherever possible and purchased under LCB, except for contracts valued at less than US$20,000 which would be purchased through prudent shopping. Plantation activities (US$31.4 million) would be scattered throughout the State and would be car- ried out through force account according to Government procedures satisfac- tory to IDA. Consultant services would be procured in accordance with IDA guidelines. Disbursements 59. The proceeds of the credit would be disbursed as follows: (a) 50X of total costs for civil works; (b) 100% of CIF price of imported vehicles, equipment and furniture, or 70% if locally procured; (c) 60% of total planta- tion costs; (d) 100% of total costs for foreign and local study tours, and studies, including consultancies; and (e) 60% of incremental staff salaries. 60. Disbursements against expenditures for the following items would be against statements of expenditures certified by the CCF/Social Forestry, the documentation for which would not be submitted to IDA for review but would be retained by the project authorities and made available to IDA review missions for their inspection: (a) plantation costs, local and overseas training costs; (b) payments under civil works contracts not exceeding Rs 300,000 and those carried out under force account; (c) locally procured vehicles, equip- ment and furniture costing Rs 150,000 or less; (d) research, studies and local consultant costs. Disbursement against all other items would be con- tingent upon full and satisfactory documentation. The estimated disbursement schedule has been based on the disbursement record for the ongoing IDA financed Social Forestry projects in India. -18- Accounts and Audit 61. The Forest Department's Social Forestry Wing would maintain separate project accounts in a readily identifiable form to facilitate their being audited independently from overall accounts. Such accounts and statements of expenditure would be audited anuually by the Government or a private auditing firm satisfactory to IDA in accordance with general auditing principles consistently applied. Audited statements would be made available to IDA not later than six months after the end of each year (draft Project Agreement, Section 3.01). Benefits, Justification and Risks 62. The annual incremental production of forestry products comprising 11.9 million m3 of fuelvood, 13.9 million m3 of sawlogs, 8.0 million m3 of small poles and 16.0 million m3 of large poles would assist in reducing the groving shortage of these products. Most of the production would bec2fit the rural and semi-urban poor, particularly, the landless laborers and small marginal farmers. The farm forestry and small nurseries components would directly increase farmer incomes. Over the six years, the project would generate 530 semi-skilled jobs in the SFW. The small nurseries would provide employment for about 3,000 farmers and the plantation activities would gener- ate 9 million labor days of work on establishment and maintenance of the plantations. In addition, the project would strengthen the SFW and related institutions and enable them to provide effective social forestry guidance and extension services. The project would also help to improve the ecology, soil fertility and climatic conditions. 63. The economic rate of return is estimated at 26Z. The economic rates of return for the individual plantation components range from 15% for strip plantations, to 332 for farm forestry. The sensitivity analysis indicates that the benefits would have to go down by 73% or costs increase by 278%, for the project to be economically unattractive. 64. The project faces no major risks. Hovever, wastage of seedlings could occur if seedlings distribution programs exceeded SFW's capacity for efficient distribution. However, the risk would be minimized by an assurance that IDA would be consulted regarding the introduction of any new distribu- tion programs. It is planned to use the existing agricultural extension service to advise on proper tree planting and maintenance instead of expand- ing the existing extension staff employed by the Department of Forestry. To minimize the risk involved in the new approach, GOK has finalized arrange- ments satisfactory to the Association, to ensure effective coordination between the agricultural and social forestry extension services. It is also possible for insect damage to occur on Ailanthus trees included in the farm forestry planting program. However, effective insecticides are available and extension advice would focus on this problem. -19- PART V - LEGAL INSTRUMENTS AND AUTHORITY 65. The draft IDA Credit Agreement between India and the Association, the draft Project Agreement between the Association and the State of Kerala, and the Recommendation of the Coumittee provided for in Article V, Section l(d), of the Articles of Agreement of the Association are being distributed to the Executive Directors separately. 66. Special conditions of the project are listed in Section III of Annex III. 67. I am satisfied that the proposed credit would comply with the Articles of Agreement of the Association. PART VT - RECOMMENDATION 68. I recommend that the Executive Directors approve the proposed credit. A.W. Clausen President Attachment July 11, 1984 AMNE I Page 1 of 5 INDIA - SOCIAL INDICATORS DATA SHEET IDIA RUEERENCE aours (tE:lQ AV A {S) a MtOST (MST RCT ESrmA7t) /b I7galb b "T b LOW IM IDDLE INCCRE lb 1970.-ETMA&- ASIA & PACIFIC ASIA 6 PACIFIC 1960- t70 ESTmAT rs cso*-Ar A (T 9A SQ. 00 TOTAL 3287.6 32U7.6 3287.6 AURtICLTUL. 1760.7 1780.5 1811.3 cp MM CaPITA CUSB) 70.0 100.0 260.0 276.7 1028.6 a cums ar (KILORAMS OF COA.L FIVALERr) 114.0 165.0 210.0 398.4 792.8 PMATI0 AM WIl SDT;SCS POPULATION,MD-YEAR. (TIMOSA-MS) 434850.0 547569.0 690183.0 Ur" POP¶ILATIOM C2 OF TOTAL)- 18.0 19.8 23.7 21.5 32.9 POPOLATIO PROJECCION POPULATIO IN YEA 2000 (KMLL) 1001.3 STAXIOrAIR POPUATION (HILL) 1838.3 TEAR STATI0RtM P. REACtU 2140 POPULATION 0E1357 PER 9Q. 1. 132.3 166.6 205.3 161.7 260.7 m SQ. U. ACRt. LAND 247.0 307.5 372.7 363.1 1696.5 POPLATION AGE STRUCURE (2) 0-1 4TILS 40.9 42.7 39.7 36.6 39.4 15-64 IRS 5C..5 54.2 57.2 59.2 57.2 6 AID *AOW 4.6 3.1 3.0 4.2 3.3 POPILATONF CQtE RATE Ct) TOTAL 1.0 2.1 2.1 1.9 2.3 URBAN 2.5 3.3 3.7 4.0 3.9 CRUDE IRTI RATE CPER 5) 43.7 40.0 35.4 29.3 31.3 OuD DEKATH RJTE t I TDOUS) 21.8 16.7 13.3 10.9 9.6 CROSS REPROOUCrIOI RATE 2.9 2.7 2.4 2.0 2.0 FAI.Y PLANIC ACCETORS, ARNA. (TUOCS) 64.0 3782.0 6826.0 USEIS CE OF NRID VWO) .. 12.0 23.0 46.1 46.6 INDEX OF FOOD PROD. PER CAPITA C1969-71-100) 98.0 102.0 107.0 111.4 125.2 ER CAPITA SUFFLY OF CALORIES (2 Or IAUROMI ST's) 96.0 90.0 87.0 98.1 114.2 PROrEINS (CIMS PER DAT) 54.0 50.0 47.0 56.7 57.9 OF URQCH AIII!I AN1D PULSE 17.0 15 .0 13.0/c 13.9 14.1 CHILD CAGES 1-4) DEATH RATE 26.2 20.7 17.0 12.2 7.6 LSFE WECr. AT SIMTH (TEARS) 43.2 48.1 52.2 59.6 60.2 IWAMT HCRT. XATE (PER 3OU3) 165.0 139.0 121.2 96.6 68.1 ACCESS TO SAFE VATER (%PO0) TOTAL .. 17.0 33.0/d 32.9 37.1 URBAN .. 60.0 83.07rd 70.8 54.8 RAL .. 6.0 20.0rd 22.2 26.4 ACCESS TO EXCRETA DISPOSAL C: OF POPILMATION) TOTAL .. 18.0 20.0/. 18.1 41.4 URBAN .. 85.0 87.07 72.7 47.5 RURAL *- 1.0 2.67i 4.7 33.4 POPTLATION PER PHYSICIA '850.0 4890.0 3640.0/f 3506.0 7771.9 POP. PER ORSINTG PERSOY 109IO.0k 83O0.0 5380.077 6797.9 2462.6 POP. PER HOSPITAL BED TOtAL 2180.0 1650.0 1310.0/d 1100.6 1047.2 URBAN .. .. 37v0o7x 298.4 651.1 RURAL .. .. 1010.0 7d 5941.6 2591.9 ADtl;SS IONS PEU HOSPITAL ZED .. .. .. .. 27.0 AVERAE SIZE OF HDSEHMO TOTAL 5.2 5.6 5.2/. URBAN 5.2 5.6 *.87.. RURAL 5.2 5.6 5 . 37 AVRACE NO. OF PERSONS/ROOM TOTAL 2.6 2.8 URBAN 2.6 2.8 RURAL 2.6 2.8 ACCESS TO ELECT. (: OF DWELLINCS) TOTAL .. .. URUAM .. .. RURA .. .. . .. ANNEX I Page 2 of 5 Da - SOCIAL IIrATORS IDAA SHeE IDI R PS (E1iz AVIWS) 1a MOST (HOST RtECIT ESTMTE) lb 7 MCNTNI LO IrO IDDLE ICOut t9 0f- _ 1970b CzST;&A1T& ASIA & PACIFIC ASIA I PACIFIC ADJUSTEM EWlNU.HIf RATIOS FIKAXT: TOrAL 61.0 73.0 76.0/f 96.1 101.2 MLE 80.0 90.0 9o.o0 107.3 106.0 FENALE 40.0 56.0 61.07f 82.9 97.5 SECONDARTY: TOTAL 20.0 26.0 28.0/f 30.2 44.9 ALXE 30.0 36.0 37.07F 37.3 SO.O IOCALE 10.0 I5.0 i.o7F 22.2 44.6 VOCATIONaL (t Or SfOHRY) 2.8 1.0 0.71. 2.3 16.5 PPIJL-TACHIER RATIO PRnIt 46.0 41.0 43.0/f 34.4 32.7 SECONDARY 16.0 21.0 .. 18.4 23.4 ADILT LITEmCY RATE (Z) 27.8 33.4 36.0 53.5 72.9 a- r PASSEUCR CASTRWIAIU POP 0.6 1.1 1.31f 1.6 9.7 RADo R vI?ER s/TOus POP 4.9 21.5 44.4- 96.3 113.7 nT ROCCIVERS/TROUSAND POP 0.0 0.0 1.7 9.9 50.1 NEYPAPR (-AILY GENER INTEREsr) CIRCLMATTO *ER TIIIAID POPLATION 10.6 16.2 19.7 16.4 54.0 cINl AnIrAL ATTINDAICE/CAPITA 3.2 4.1 3.7/e 3.6 3.4 LABOR I TOTAL LABOR FORCE (TlOUS) 115951.0 219194.0 271179.0 FINALZ (P"MCE) 30.7 32.5 31.8 33.3 33.6 A=ULSURE (PERCENT) 74.0 74.0 69.3 69.0 50.9 IMUSTm (PERCENT) 11.0 11.0 13.2 15.8 19.2 PARTICIPATON RATE (PERCENT) TOM 42.8 40.0 39.3 42.5 38.6 KWE 57.0 52.4 51.9 54.4 50.7 FIALF. 27.3 26.9 25.9 29.6 26.6 EC-R IC DEFENDEDC RATIO 1.1 1.1 1.1 1.0 1.1 DEa IsUTDIO PERCEN OF PRIVATE DNCCIE tEcEIVED BT UIGAEST 52 OF NOUSERLOS 26.7 26.3/h 22.2/1 16.5 22.2 HIraSA 202 OF NOUSEUaLDS 51.7 4a.97F 49.47T 43.5 48.0 LOES 20U OF NOUSEHOLDS 4.1 6.776 7.07* 6.9 6.4 LOEST 402 OF HOUSECILDS 13.6 17.27C 16.27 11.5 15.5 P-vil!Y TANT aOm" ESTICATED ABSOLUTC POVERTY 1fC0 LEVM (USS PER CAPITA) URBAN .. .. 132.0 133.9 196.5 RUAL .. .. 114.0 111.6 155.0 E_STIMED RATIVE POVERTY INCON LEV CUSS PER CAPIrA) URA .. .. .. .. 178.0 RURUL .. .. .. .. 16'. ESTIDATED POP. BELOW ASSMUTE POVERTY INDC LEVEL (I) UAt .. .. 40.3 43.8 26.6 RauAL .. .. 50.7 51.7 41.1 NT AVArLABLE .OT APPLICAILE N O T E S - /s The group everqgu for each indicator are popu1attem-we1ghted arltimetic mea. Coverage of countrimn amorg the Indicator. depends on availabllty of data and is not umiforo. /b Unless otherwise noted. Data for 1960- refer to any year between 1959 and 1961; 'Date for 1970- between 1969 and 1971; and data for '!ost Recent Eatimte' betw"n 1979 and 1931. Ic 1977; /d 1976; to 1975; /f 1976: 1 1962; /b 1964-65. May 1963 Page 3 of 5 31314, 441045 I11 4314... 40- 4.31 -. a.1414LL? jod54d g331mo 4014thti1tatl .44"1.1,40..Iat 3041.1.. 44 -*l.a U.. it.,4 314 1-I4...33a5I 31404144s.=445 .4 Ch. 444 .4 .Pat40 A.d ..4 4.21.1- .4 a.. ... It 01134rI0 ro-allo 1. .3.41114 I- 3. A-.. 10.0 . ,.t I....0.13 f.tt4tba _.- .4. aaaafit * PA.141 1404.40- 'Noaamorla 313.14 Po141al 4113 ,1t.ova1 40 aoL9. low ml...... ,-'q, Pro (13 skI " v1043 gr-3 .1 331 100" 4 Pat.0.)). -.U" -w. .114 .woool 44440r 044 a~ ~1 h ..rp g- 4. l 9ab)1ct .0401? Iw.P. Ill 14050 Ottawas 413 304sq.41s 00 30. 1 %4344 Smoot 104 At""w oad 511644. Go.,1 * Paar3 h.-. .4 *44.-fta0r 14 h143.l1t.). 1.40. CONtraft14 41 4.15 a 31 mapa lt .0o .34416to ....ht4 -1411011 3140 t14 a40 PoOk.3.t 44 .01o, -.., -0 14241417* 30 -1311 L. 1 54- 0 4I.. 14. that I'maa..34.. Rhait l411a 1 raaaart1t4144 at sd30tr 4441.-..4, aa11 443 1.hbtaaap f 4 o . 4.444t4 ..lt. .40la Loot 4. 40 t 3 4o 4 73.414.31 4.14131 4*444t - Ft.3.th 44.140 by L.60w .3r Its W t or1t..130 113144 1 W,14 P~ar* aftal4'. 4.41113101. - .0 one .1 Peru ft aday~ ~~~ ~~~~~4.- e., .44 e4403 ..41..1.44 ""P "'Na 1443d 4t.133110 414 W 44 It. 31404 4.44. .c1. "Mto 0141. 4.II 3-.0I.a330041 hd 340.441s 40 4.1 .Gm pa Pty 41a aretaab1paco 44Iab-1. Pul 3141.4. S4t1U34t . morlm p4.tisl 441.Ipa.41 atdt 1341 40 1541 aPtiod P4".Fid 11440 14 ML. %-b. .3 .ltle t31. .314.1.. vov.".3 .4..3. atta.p.e 1.0144044 tafro also. JIM0. 40a in53 4.14.b - .441 114.1. 3311.4o. 440 13.tp.t1g.aa~t1 l40I.1*. 4. i44 aaharo ot.3t. 013 44 Rarl h10431.Il* ar 4003 1.4 0 4041l 1404. two. JS1t1"t 14011U11.Itl.drb soap'tat 1 - 4d "ft 1.4.4 311Woo,4 1.141a..a 4. , of4 .1aIy 1 14Sab. 1431. . .. 3I. IS Ao - b- 34111 -ha 44 aftl.todo 1. or 41.111.4. mil ',-.~ .tO 404 .4.4- OvIa'a P4ts j43314 411 I114 W 0 34 14.4 4.4.3134 W133..-Uim 41404431.44 W _4h,,.17.4 doe. 44 4PP aoatoog ISM. two. 4013121 4m.1.w.h3 400d14.0.hlaL- 0.00.441 7 - carroL po.3. 110 projo.tooo04 11444a - 1431 40a hPalf tagl ..l.. 4 4.314 - 144440? Par or? tat h.Saa 1.1 A1. toptica 444313, .4 U.d.. - mp4. an 141e. l- .Pa114t 14474 4.4 44 4m. 5-apm.11.0.. saa144. 40rs oo4 .44 311.4 4004.13..53 4414411 40 f.143L4t, L.404 ft, W.Jstgao s..rp.... of tSta. -aa..* o4d -0.3 4034 d- .. italy. 0tk 3. ti.4..- 3. 4.4ll.4.rw 411414410o 144 3.1t m.o.4 P3144. :m3 ht.3..414 104.1.lt. 40 I Pt. 14 9 14 ft. 4.131" a1444l4041 404- 1. - 3 1.4 AT1 .41.4r- I4.1t, 3444.e- gt 4.143. 31131 3,0.41 144. .4wIll141 .4444 134 441. 40 `1j.0.I- ..44341-4 - 44 e-.344444 40 4.3131331 I.3..L 1111.419 141 14.11.4. 7 V.44 0 ..413474.3 a37..404-4.13 ~4ha44 .31 111 a 1.43.. 4.T.444,.4449- 140.3 ~ o-141.140.4 343134 - l oth.a. , 4*44 4.4 f44 31. 0. tt4411141 3sm. -d 44.310 144 .544Soon41 340 4314413 .131.4. I?Fa r 4.Sy ham.. 4413 4 34ss . d....0kStI -d4~a..... aogsa... 4314444-4.10 t.. 45,41.11.. 10 11.11. -44..WC - a1444 0.4 ftnr 3. -I,445 II141 40 P134 -3. 1.11t * 41. 4440*11400 4T. 4.4.4431443 354. two.4. 3.0lo4dat. 143110 .0.4344.443444 - h*.1 * tta4444..41.1.43 403 31444.14 314390.44. 44orb. or -b3443. .14f 14 R34.-41..Sba a _" ,oar'Moatt 140tf 363.$dL14-. . P" 097*1o C." &-a to Co 4r 5- Aa41. 4.4511. p. O.-5d atl 0.4- 3. 4.3-"I-.3111.14. PO4111 t4.4; 34111 1317.-ragoo4 4.l31 L. 31"0. 1930. O". 144445 44334 11. p4410-4.r 9.9.1413..t; -31.6r*.. 1443t.A, -- . e f!R.1 nb214-ataaw. S.4 so44411 14401414 f -0It341 .0 4. 3.113t3.4 .1.44. 4401 910...b 111144. -S l LI,r 3414 141. 31, 4.Ia 4314; 4.34 444.1 313731041044141 11..4 414 . 1 3 4. 14.1 ~11-343.4.. 4.31..4 44143. Tv 1. --4.1 3 p14114..141 131 4441114. k4..43a .44.44144414 4 ha .31 I- 31_ p-.41 1 34...4...41.. L 44* 4314401. 41311.4... 4313.51.. 4.04.3134. , at." ao" mad. ft.s 14441.1 4d.111.4.44t p-. 4113 -. . t 10. 3 40444 141d t .444044" .41.3. 44. 4.d114 4 .0.1 p1133.1 P". 4-. *k1.4-- 144.-4 - 10 41m£1-434 .443.1 t44- 4. 43 4 404.40aa 114o ' OaVF1144). 4.1.54 3L14. ad44.A. .3..4.4 44047 tam3L433.01111. 40t.A dta-- ~ f&s -. f-b~ g . -I. "Y41. -4. 10.1 133..-m -"" oo 1 .13. I...131 3314. 4.4.3. 431414443.4134 464 344"392 4...p.& a. pa~.1 -41 1.4t 314 144k.1%I`43 40.14.. atid 414.1 14.3 -. . !jr4040)o. il 4144 3.0. 34-. I 44411 1113414 movair4La01t 544 3113444. FAD441014 l- pa".111.41141 ae .4w4. 31r40.1-WC 144 .s I .3404. rLo" 1131t4. 4 at'al1111? _4 %.1011 313144.113 t11-p4t.41 t31414.hdy aot14.. oarlp W34404.i146 4431.1 1404r N.,l; 140. 111 L 40331 ft.14 3114701.440 47 3-1.31431 43403144304also3tt341h 343. ( -.3 a- o.tI -f. r.13 .I L14..13t3141 44 4.13. wa.4.. 44 4.11 04...4 h 41111. aPCo P.,1414. 4. 140.1934 40d 1143 dot...7414444.30 4119144 11144"f014"I4.31 l314 144145.351 .44334.31W. I.WFP10 -94 P " 4.114 43 . -14413 404411 W.444p 45 -14 441.. 01411 435333U5p4331y PAt1. k.-S 4433 1...11 ata.t1 1f01461 33.4044) .3 -4 4.4.?. 447v .1 Ioad.4 C 44 11 .410 84).3134 1 40rl8. 4-o 4.4114 4.- 334. 1443. 3140. 397)4-a3313414. 0.1014 414111;I160 441 .4PM3 40. .4I.33 1111A W14114 11441.3 140131.I e "A44 "34.11. 4414 3i.4 04..44143 4 141.141 40.4r"LI.t44-44*l3.. 144 ...3.115 414. .4 I 41 441 p 4 4. 3140134. 33 Lra or640 34434 453a 414. 14434.4 31-114 4431-r141114 14-111413 3444 M4~4l .1 e4. 1140 .444. 14 ..~l~~f44 1314.l baroala. 40 1444 amr.43140443 V4411 I334.44. 1.44 4. 4I 10414 44 4312.) (411 ...0.*am of VW401 1114 posa04414."aa So 4.31 *4o3.l4.43.f. . troa. 401 1141.1 143114 at1 solos 14 .1 434 o-aa. Ctoo l4144.153too1443134144 33144111040 47.4 0431101414. 1154 3.4 3101 4414.14.041..6311 0101441. ,s3" "M M44 144 4 a.4144 4.4443 4 34443. t14 .a C. 410.P.. lesat rapa4t 411. P0 400 or. 444..4.4445.414 4143 140.. So * t.mas4 0. Fetly.4 1401r1 44d1.43.41 41711113141.3.ta414131. 1t1 14 e. 411. 3 Y0 S.p1.6 ch1.13 11_I aadaoo. S=037T4 31141I4- 317 34344 " 1A ... 33..41.14.144.30134. T....4SM.4 403. AM . ... c c v3mo=m 198ZAS bi _Ai am 0- Cc, ca. PricesJ 155/56-1959160 060/'6-196&/5 L95/66-1956/70 197071-I1974175 1975176-1979M uss &z_ 2 at g_c hm. 170.7I 10-0 3_7 3J6 3.7 2.9 41 aCos n Z nl 4_C99 256- cou Eomlm s_sa 33U12 2L.3 Caz CO ae.m - 3.37 - 2.3 .3 . tAw0 Wm nriuro 13 1961 1.1. aUai (at fato c rot) Il 1 _ P erMocke U -s s az - _ : hg aT. U-51.7 3.2 7L27 70.6 50 zmy 35.2 233 3 19 1M114 1l5 Servce 60.4 41.0 60.3 14.5 1I54 29 Cecal CGove ae o CiNtra Go.a_ 2. 3,_ . S f cup an. S3- I of CW 1162t3 1i2/63 -17`t-1M623 119623 1962/3 1913/29-I119=13 mica 333.34 23 £9.5 175_61 10.7 10.5 3G0.9 20.7 1.0 - IL59 U._S 10. e surpZuawfaf - G-75 - 0.4 0.5 - 9e - 0.8 - 04 C6 _ f 131.2 8L0 LL 95.l3 5.3 5.7 :.l saeatmm Ct) 19330 L2 1.0 .9w iyd= am mmi 1970M 1 19177 1977 3/79 2979130 1160/3 1361/3 1962/6 Pabruar-, 1963 VaeUar 16 30.. I9 Oado u 109.8 224.J 320.1 011 423 53_5 624.9 723. 711.7 845.7 =k CrM ato I C (na) 54.6 1063 137-3 15.3 200.1 257.2 309.1. 352.4 353.5 40. - 1z to Cmmtial Seto 64.6 156.2 212.2 255_3 31I0. 3a35 630.5 505 3-7 576.4 O7urec or laden par.) pr-fob 1962/33 erJ-Fab 1133" 3..., ma Q'Aai mumy as a I cc CDP 27.3 30.3 36.7 41.1 "-.1 436 42.0 64.0 Ua3lom. Price Inamu 1171 - I1 100.0 1.0 35.8 15 217.6 2S,73 201.4 M.6 203. 314. A1 p _ra dl_ 1a Mb2IAaa1. PritS 1Mftft 7.7 -L-I 5.2 - 17.1 13.2 9.4 2.6 2.3 9.3 -n a_r to 0r (Cme) 15.0 2Z_7 163 16.0 25.6 20.5 20.2 l4.0 21.0 sr 1s.9 hi _Cr2?to Caeit a Sector 19.4 2t.7 1M 20.2 21.5 17I2 18.4 17.2 13.5_5 17.9 if W CmW _C12 auti I& at m.tc pr . a1ln 3.w1 3m Ulm rboda1gy. beer period 19 1331. 41 e_ba ct19a to donea So this tlA- at Me ewurq uac a rat pem"as darius thu vauald Cw-a& i wick Notar ,. Crtnrl SctLt ical O19n,9. m c from L lisaf atW at facto couriam, Iac1dun oa o_eatin before fizuc eau .n usbar.atJn eftar Iat yw of ls dar W lbrId 3e rnlrnaa Ge dL*int se comeml_ml diJ ad 1. I m I Core sad StatS bKe ula emn6 Tf ul _ anOm. to Phin uca _e _em tt t. i _acerne Chd Ire _nd-th 132 to _-rabcom 1963. h/ .2aer cbae f£ ru_ -abcb 1163 to *-vabm7 1964. I Tal labor P a" p cr baum fr.m 1161 Cmman. cluid dets fow Aass. kw 5 C15 -m mS' WeUam Is er3.1mm - 7.60 / 6.*1n *.Ams - Simm lZ9 as (mc 1-.63 574 S0o am _ 573 7 ,~~~~~~~~~~~~~~ 1a.5 ?za 46 61St tomb etXtb 0 6 _hSe- 1.1mm - 6335 - *6.57 - 5. 3i50 .1.1 _ w 333 4 r am 30 0 5 1m c3ms (MC) fr/ 660 MG - 35 - 60 4 m 133 1.54 1., 6- I 3.5* 46 1.1m a. _zrmc - - 2,366 - a3.43 3.54 3 3 Gros 66ukrainc. 2.431 Z. 3. 1 3.64 . . W 31. 113 _ _mcSm - 760 - 64 - M - _ _. Fz 3W C-c) *.13 1.03 630 1.360 1.2 i.uewo1 " DAIbwumi 19.6 au Or USE o 367 - 1.31 12 331 1__ lI_I Ls Sm _ _ C-) 3 2.31 - 3 - 3 G C"um Cmi r) Al 4.461 4.9*, S. Mr 3CiSz 31 1162163 .1 104 W .. mot oe _ Cwmd YOM) *Bm 3.46 2., 1.49 D 253W 31 116 3 EMPOTo UC1M1WA aI 6.612 3.130 4. 613 3.US ra _~ Ka Ja I6_ a10 S ci dm I7 : 551.00 - ft 7.30 Be 1.60 - 60.13333 Sia-&Ecmw zmn co em-imm1, 2: SSLIS- - ft 7.379v ~~~_ s3. LU-504156 lb 1.10 - IO.13m1 sptae_ oww7r __ t n :tl.O - Sm UL 66 L WS*31-r-) =s~~~~~~T _ S . - MCAu out 0 oI.Ikrb 16 =$Iso so 10.715e $~~~~~~~~6 -A -5.03 k/ 13me ew a.1 Invetmen Zamm (met). 1.j. p.ymcm me 101tmt m 6 cst Isa1mm, ad cbmW 3ald1 3W. a" sdu vm1cs 6. I *atmat MeimanSm 6 cm_t_. 1 Sm - latf et ' _oLtm butl s.cl_d ffea _d9g z_em satoe%I to icle __l ecsx lam. ad g_o m _ of _wu_u_ Mt sw o f eg=_c fec-. a' cm.Uascl mg ~Mcw pswome a fameSW Loam anm pinmemtq of total cmgzmc gem.mps. o" Zac1ud.m - mm mijmse. to th v.1umtU. .e z0ewo an f10mLat of tmmcmI rapewe . ZI la1Um soi- s. ~~~~~~~~~~~~Pw I--of 4= A.SATNMT OF MX LANSA IDA CrEDIT (As of arch 31, 1984) US$ zilIion Loan or Fiscal (Set of Cgceliatwios) Credit Year of So. 1flAy-o-lan IDA af UndoisBkse 11 49 Loans/ 1,766.5 - 85 Credits fully disbursed - 4,858.4 - 482-IN 1974 Karnatka Dairy - 30.0 10.28 521-I1 1975 jasthan Dairy - 27.7 4.78 598-IN 1976 Fertilizer Industry - 105.0 0.21 604-IN 1976 Power Transmision nV - L50.0 0.13 610-1N 1976 Integrsted Cotton Developmet - 18.0 0.95 1251-IN 1976 Andhra Pradesh Irrigation 145.0 - 37.55 1273-1I 1976 National Seeds I 25.0 - 14.29 1335-U 1977 Bombay Urban Tranport 25.0 - - 2.84 680-U 1977 Kerala Agric. Development - 30.0 10.19 682-U 1977 Orissa Agric. Deelopment - 20.0 1.86 685-U 1977 singrauli Themi Power - 150.0 2.82 690-3 1977 West Bengal Agricultural Extenion & Resedar - 12.0 8.92 1394-N 1977 Gujarat Fisheries 14.0 - 4.08 712-i 1977 K.P. Agric. D celopmet - 10.0 0.29 720-U 1977 Periyar Vaigmi Irrigation - 23.0 4.00 72B-U 1977 Assa Agricultural Dev' ipet - 8.0 3.38 736-IU 1978 Nabarashtra Irrigatio - 70.0 1.91 747-UJ 1978 Second Foodgrain Storage - 107.0 56.87 756-IU 1978 Calcutta Urban Developmet rr - 87.0 1.88 761-U 1978 Bihar Agric. ztension & esearch - 8.0 5.22 1511-IU 1978 101 JointPublic Sector 25.0 - 1.97 1549-U 1978 Third Trambay Thermal Poer 105.0 - 4.20 788-U 1978 Karnataka Irrigation - 117.6 45.64 793-IN 1978 orba Thezaal Power - 200.0 33.59 806-UN 1978 J-Kssbmir Horticulture - 14.0 10.76 808-IU 1978 Gujarat Irrigation - 85.0 3.99 815-IU 1978 Andhra Pradesh Fisheries - 17.5 9.51 816-IU 1978 National Seeds II - 16.0 6.74 1592-U 1978 Tetec_nuications VII 120.0 - 20.61 824-IU 1978 Ratioal Dairy - 150.0 60.67 842-IU 1979 Bombay Water Supply 1I - 196.0 148.04 844-I 1979 ailway Nodernizatieu & Maintenance - 190.0 34.79 848-IN 1979 Ppnjab Water Supply & Sewerage - 38.0 6.88 855-I 1979 Rational Agricultursl Research - 27.0 15.87 862-U 1979 Composite Agricultural Extemion - 25.0 4.82 871-U 1979 National Cooperative Developmnt Corporation - 30.0 1.76 1648-IU 1979 Smsgundm Thermal Power 50.0 - 50.00 ANE II Page 2 of 4 US$ milo Ladn or Fiscal (set of Cancellations) Credit Ye"r of NIo. Approval Puzuose 1an Im. jj is 874-IN 1979 lamdam Therml Power - 200.0 18.95 889-IN 1979 Punjab Irrigation - 129.0 48.83 899-IN 1979 Nabarashtra Water Supply - 48.0 12.19 911-IN 1979 Rurl Electrification Corp. II - 175.0 16.16 925-IN 1979 Uttar Pradesh Social Forestry - 23.0 5.42 954-IN 1980 rabsraahtra Irrigation II - 210.0 58.97 961-IN 1980 Cajarat Comunity Forestry - 37.0 10.82 963-IN 1980 Inlad Fisheries - 20.0 16.86 981-IN 1980 Population II - 46.0 30.84 1003-IN 1980 Tmil Nadu Nutrition - 32.0 21.19 1011-in 1980 Gajaat Irrigation I- 175.0 111.93 1012-IN 1980 C"aewnut - 22.0 16.98 1027-IN 1980 Singrauli Thermal II - 300.0 172.64 1028-IN 1980 Kerala Agricultural xtiensxon - 10.0 8.08 1033-IN 1980 Calcutta Urban Transport - 56.0 21.32 1034-IN 1980 Karataka Sericulture 54.0 35.56 1046-IN 1980 Rajasthan Water Supply & Seerage - 80.0 57.17 1843-IN 1980 Industry D3FC XIII 100.0 - 7.71 1687-IN 1980 Farakka Thermal Power 25.0 - 25.00 1053-IN 1980 Farakka Thermal Power - 225.0 118.94 1897-IN 1981 Kandi Watershed and Area Development 30.0 - 22.73 1925-IN 1981 Bombay Nigh Offshore Development 400.0 - 2.92 1072-IN 1981 Biar Rural oads - 35.0 17.11 1078-IN 1981 Naba-di Barraes - 83.0 51.69 1082-IN 1981 Nadras Urban Development II - 42.0 20.91 1108-IN 1981 M.P. Iediu Irrigation - 140.0 9.94 1112-IN 1981 Telecommunications VIII - 314.0 111.50 1116-IN 1981 Karmataka Tank Irrigation - 54.0 41.97 1125-Il 1981 Razira Fertilizer Project - 400.0 165.74 1135-IN 1981 Nabarashtra Agricultural Ext. - 23.0 15.75 1137-IN 1981 TaIil Nadu Agricultural Ext. - 28.0 19.09 1138-IN 1981 M.P. Agricultural Ext. II - 37.0 30.42 1146-IN 1981 National Cooperative Development Corp. II - 125.0 80.24 1172-IN 1982 Korba Thermal Pover Project II - 400.0 297.60 1177-IN 1982 Iadhya Pradesh Major Irrigation - 220.0 175.64 2050-IN 1982 Tamil-Nadu Newsprint 100.0 - 28.41 1178-IN 1982 West Bengal Social Forestry - 29.0 22.42 1185-IN 1982 - upur Urban Development - 25.0 18.67 2051-IN 1982 ICICI xiv 150.0 - 81.49 2076-IN 1982 Rsagundam Thermal Power II 300.0 - 300.00 2095-IN 1982 ARDC IV 190.0 - 5.43 1219-IN 1982 Andhra Pradesh Agricultural Ext. - 6.0 5.05 2123-IN 1982 Refineries lationalization 200.0 - 123.52 2165-IN 1982 Rural Ilectrification III 304.5 - 290.68 2186-IN 1982 Kallads Irrigation 20.3 - 20.00 1269-IN 1982 Kallada Irrigation - 60.0 34.69 1280-IN 1983 Gujarat Water Supply 72.0 66.53 1286-IN 1983 Jamu/1Ksbmir and Page 3 of 4 Loan or Fiscal (Met of CancllatJi Credt Year of ,F 21 A,^Vrov pr e DEgoda " it laryan Social Forestry - 33.0 27.65 1288-I1 1983 C lbl adhya ftadh - - Irrigation UX - 31.0 22.87 1289-IN 1983 Subruawrekba Irrigation - 127.0 117.32 2205-IN 1983 KrisDbn-Godavari Exploration 165.5 - 148.22 2210-IN 1983 Railways Nodermizatiom & Na4itenauce 1I 200.0 - 197.04 1299-IN 1983 Rai-ways kodernizatimn & Nainetnauce II - 200.0 192.83 2241-IN 1983 South lass*ia Gas Developueet 222.3 - 133.71 1319-1N 1983 Naryan. Irrigation II - 150.0 129.18 1332-IN 1983 U.P. Public !ubewslls II - 101.0 96.62 1356-IN 1983 Upper indravati Kydro Power - 170.0 158.07 2278-IN 1983 upper Indravati Nydro rower 156.4 - 156.01 1369-IN 1983 Calcutta Urbai Deuelopa.t III - 147.0 145.05 1383-IN 1983 Mbaarashtra ater Utilition - 32.0 31.13 2308-IN 1983 Nharahtra Water Utilization 22W - 22.64 2283-IN 1983 Central Power Transmission 250.7 - 250.07 2295-IN 1983 imalayan Watersbed Man gement 46.2 - 46.08 2329-IN 1983 dbtaya Pradesh Urban 24.1 - 24.04 1397-IN 1984 Orissa Irrigation Ir - 105.0 97.97 1424-IN 1984 Rainfed Areas Watershed Dsv. - 3L.0 31.0 1426-IN 1984 Population III - 70.0 70.0 1432-IN 1984 Karuataka Social Forestry - 27.0 27.0 1454-IN 1984 TaLil Iadu Water Supply* - 36.5 36.5 Total 5,183.2 12.015.7 of which has been repaid 1.29L.8 153.5 Total now outstanding 3,684.4 11,862.2 Acount Sold 133.8 of which has been repaid 133.8 - - Total now held by lank and IDA j, 3,884.4 11,862.2 Total undisbarsed (excludin *) 2,021.25 3,701.25 jj IDA Credit iounts for SDR-denominated Credits are *zprssed in tor=s of their US dollar equivalents, as established at the tim of Credit negotiations gnd as subsequently presented to the Board. O Undisbursed mouncts for SDK-denouinated IMD Credits are derived from cw alative disbursemats converted to their VS dollar equivalents at the SIRIU dollar exchange rate in effect on March 31, 1954. ]/ Prior to exchange adjustment. * Not yet effective. ANEX II Page 4 of 4 B. STATEMENT OF IFC INVESSTKES (As of March 31, 1984) Amount (US$ million) Fiscal. 'year C-ompany Loan E3uity Total 1959 Republic Forge Company Ltd. 1.5 - 1.5 1959 Kirloskar Oil Engines Ltd. 0.8 - 0.8 1960 Assam Sillimanite Ltd. 1.4 - 1.4 1961 K.S.3. Pumps Ltd. 0.2 - 0.2 1963-66 Precision Bearings India Ltd. 0.6 0.4 1.0 1964 Fort Gloster industries Ltd. 0.8 0.4 1.2 1964-75-79 Mahindra Ugine Steel Co. Ltd. 11.8 1.3 13.1 1964 Laksabi Machine Works Ltd. 1.0 0.3 1.3 1S67 Jayshree Chemicals Ltd. 1.1 0.1 1.2 1967 Indian Explosives Ltd. 8.6 2.9 11.5 1969-70 Zuari Agro-Chemicals Ltd. 15.1 3.8 18.9 1976 Escorts Limited 6.6 - 6.6 1978 Housing Development Finance Corporation 4.0 1.2 5.2 1980 Deepak Fertilizer and Petrochemicals Corporation Ltd. 7.5 1.2 8.7 1981 Coromaudel Fertilizers Limited 15.9 15.9 1981 Tata Iron and Steel Company Ltd. 38.0 - 38.0 1981 Nahindra, Eshindra Limited 15.0 - 15.0 1981 Nagarjuna Coated Tubes Ltd. 2.9 0.3 3.2 i9gi Ragarjuns Signode Limited 2.3 - 2.3 1981 Nagarjuza Steels Limited 1.5 0.2 1.7 1982 Asbok Leyland Limited 28.0 - 28.0 1982 The Bombay Dyeing and Manufacturing Co. Ltd. 18.8 - 18.8 1982 Ibarat Forge Company Ltd. 15.8 - 15.8 1982 The Indian Rayon Corp. Ltd. 8.3 - 8.3 1984 The Owalior Rayon Silk Kanu- facturing (Weaving) Co. Ltd. 4.3 -43 TOTAL GROSS COMMlTMEN15 211.8 12.1 223.9 Less: Sold 53.0 3.4 56.4 Repaid 32.0 - 32.0 Cancelled 16 s 1.4 17.4 Now Held 110.8 7.3 118.1 _r _ _ Undisbursed 81.2 - 81.2 o _ - __ ANNEX III Page 1 of 2 INDIA KERAIA SOCIAL FORESTRY PtOJECT SUPPLEMENTARY PROJECT DATA SHEET Section I: Timetable of Key Events (a) Time taken by the countrY to prepare the proiect 15 months. (b) The azencl which has prepared the proiect The Government of Kerala, assisted by the Association. Cc) Date of first presentation to the Association and date of first mission to consider the proiect October 1983; January/February 1984. (d) Date of departure of appraisal mission January 1984. Ce) Date of completion of nenotiations June 1984. (f) Planned date of effectiveness October 1984. Section II: Special IDA Implementation Actions None. Section III: Snecial Couditions (a) The Government of Kerala would, within specified dates: Ci) finalize arrangements for sale of fuelvood by June 30, 1986 (paragraph 45); (ii) review the nurseries scheme annually and submit a report to IDA (paragraph 48); (iii) complete the wood supply and demand study by December 31, 1985 (paragraph 51); (iv) fill vacant positions (paragraphs 52 and 53); and (v) carry out a mid-term reviev (paragraph 54). ANNEX III Page 2 of 2 (b) GOK would consult IDA regardiug introduction of any new social forestry programs other than activities financed under the project (paragraph 64). IBRD 18106 r7° APRIL 1984 INDIA KERALA SOCIAL FORESTRY PROJECT _12e~~~~~ ~ ~~~~~~~~~~~~~~~~~ 120r \ NNANORE KARNATAKA -R>n t . t - o- _T. -, 0 ~ ~ ~ \ pm0w Regiona so1x TAMIL o o tr Hw 'RMs Cal NADU 19 Sod, _ Tyes --" T. Aw M I - Laterite Sod 300 . ---Blackc Satil . ..... IcaK )/ - -Peat Ka ri Sd355P L( K 8T " . II and Forest Soil tSandy Soil 3G .o50 /1 Red Soi I G w- ---Normal Rainfall (inceimeers) -RoodsG _ -10 (3 Store Copitcl 310 e District Capitols o Selected Towns * District Bons/naso d~~~~~~~~ ~ ~ ~ 'i a'0 - --55* > ~~300 ,. > 0,-0- go r~ ; U I To- 4ftj,'° INDIA~~~~ I N D I A |, ''S'Z' , J . ~~~~~~~0_ 25 50 75 100 ; KILOMETERS - ~~~~~~750 720