Announcement of World Bank and IDA to Support First Irrigation Project in India Using Underground Plastic Pipes on June 28, 1982

. . . . FOR .IMMEDIATE . RELEASE . •World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 82/130 Contact: Hugh Blackman IDA NEWS RELEASE NO. 82/94 ( 202) 477-387 9 June 28, 1982 WORLD BANK AND IDA TO SUPPORT FIRST IRRIGATION PROJECT IN INDIA USING lJNDERGROUND PLASTIC PIPES Small landholders in the Kallada River area of Kerala State, southwest India, will be helped in their efforts to increase agricultural productivity through a combined loan and credit from the World Bank and the International Development Association (IDA) totaling $80.3 million. The Government of Kerala is providing half of the total costs of a $160.3 million project for year-round irrigation and more intensive cultivation of tree crops, primarily coconuts, on hillside lands and paddy crops in valley bottoms, in an area covering 37,600 hectares. The funds will go towards completion, by 1984, of the partially completed Kallada dam and the construction of two main canals and associated minor water conveyance systems, and the provision of appropriate support services. This will be the first major gravity irrigation project to be carried out in India using low-pressure underground plastic pipes to irrigate garden lands, where the topography does not permit the use of conventional open channel methods. The Kerala Department of Agriculture has established a special section to ensure that adequate support services are provided to farmers. As a result of increased yields from tree crops and paddy, incomes of small landholders are expected to increase. The number of households below the poverty line is expected to be reduced by one-third within the project area. Civil works construction will generate about 22,000 jobs for five years. The consortium of governments and institutions that met recently under the chairmanship of the World Bank to discuss development assista.nce to India had underscored, among other things, the government's intentions to sustain high levels of investment in irrigation. The World Bank loan of $20.3 million will have a repayment period of 20 years, including five years of grace, at 11.6% interest per annum, and a standard front-end fee of 1.5%. The IDA credit of SDR 52.3 million ($60 million) is ~:or 50 years, including 10 years of grace; it carries no interest, but bears a small annual service charge of 0.5% on the undisbursed balances of the credit, and 0.75% on the disbursed balances. IDA is the World Bank's affiliate for concessionary lending. NOTE: IDA credits are denominated in SDRs (Special Drawing Rights), which are valued on the basis of a "basket" of currencies. The -U.S. dollar equjvdleut of. the SDR amount of the IDA credit reflects the exchange rates ~xisting at the time of negotiation of the credit.