India - Narmada River Development - Gujarat : Water Delivery and Drainage Project

Document of The World Bank FOR OMCIAL USE ONLY c /t)3 -,A Report No. 5108-IN STAFF APPRAISAL REPORT INDIA NARMADA RIVER DEVELOPMENT - GUJARAT WATER DELIVERY AND DRAINAGE PROJECT February 12, 1985 South Asia Projects Department Irrigation II Division This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENCY EQUIVALENTS L'S$1.00 = Rupees (Rs) 12.00 1 WEIGHTS AND MEASURES (METRIC SYSTEM) ] I meter (m) = 3.28 feet (ft) 1 kilometer (km) = 0.62 miles (mi) I hectare (ha) = 2.47 acres (ac) 1 million cubic meters (ym3) = 810 acre-feet (ac-ft) 1 cubic foot per second (cusec or cfs) = 0.028 cubic meters per second (m3Is) 1 kilogram (kg) = 2.2 pounds (lb) 1 metric ton (mt) = 2,205 pounds (lb) 1 million acre-feet (MAF) = 1,235 1X cubic meters (Mm3) 1 cubic meter per second (cumec) = 35.3 cusecs 1 metric ton = 1,000 kilograms (kg) 1 gigawatt hour (GWh) = 1 million kilow tt hours (kWh) 1 kV = 1,000 volts (l0 V) 1 megawatt (MW) = 1,U0O kilowatts I kilocalorie per kilogram (kcal/kg) = 1,800 British thermal units per pound (Btu/lb) 1 kiloliter (kl) 1,000 liters (1) FISCAL YEAR GOI; GOG; GOM; GOMP; GOR April 1 - March 31 j/ The US Dollar/Rupee exchange rate is subject to change. Conversions in this report have been made at US41.UO to Rs 12.00, except the economic analysis which was made at a rate of US$1.00 to Rs 11.00. O/ The metric system has been used in most cases. However, India is still in the process of transition to the metric system; non-metric units are still widely used and have been used in this report where a conversion to the metric system may confuse the reader.  FOR OFFICIAL USE ONLY ABBREVIATIONS AND ACRONYMS AD - Agricultural Department CAC - Sardar Sarovar Construction and Advisory Comuittee CAD - Coumand Area Development CEU - Central Electricity Authority OCA - Cultivable Command Area CEPR - Canalhead Powerhouse CPU - Centralized Procurement Unit CWPC - Central Water and Power Commission CWPRS - Central Water and Power Research Station CWC - Central Water Commission DRP - Dam Review Panel ERR - Economic Rate of Return EL - Elevation FRL - Full Reservoir Level FSL - Full Supply Level GAU - Gujarat Agricultural University GEB - Gujarat Electricity Board 6OG - Goverment of Gujarat GOI - Government of India GOMP - Government of Madhya Pradesh COB - Government of HNabarashtra GOR - Government of Rajasthan GSCHF - Gujarat State Cooperative Marketing Federation HYV - High Yielding Variety ICB - International Competitive Bidding ID - Irrigation Department of the GOG ImD - Indian Meteorological Department lIWRB - Inter-Departmental Water Rates Review Board LCB - Local Competitive Bidding MDDL - Minimum Drawdown Level MISC - Management Information Systems Cell M&I - Municipal and Industrial BP _ Madhya Pradesh NWL - Maximum Water Level NCA - Narmada Control Authority NDD - Narmada Development Department of the GOG MHPC - Narmada High Power Committee NPDDC - Narmada Project Dam and Design Circle NPG - Narmada Planning Group NRC - Narmada Review Committee NRD - Narmada River Development NTPC - National Thermal Power Corporation NWDT - Narmada Water Disputes Tribunal PDD - Power and Dams Division PME - Probable Maximum Flood RBPE - Riverbed Powerhouse REB - Regional Electricity Board REC - Rural Electrification Corporation SA - Service Area SEB - State Electricity Board SLDB - State Land Development Bank SmS - Subject Matter Specialist SSP - Sardar Sarovar Project T&V - Training and Visit System of Extension VEW - Village Extension Worker WALMI - Water and Land Management Institute I This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  GLOSSARY kharif - Wet season; June - October rabi - Dry season; November - March chak - Irrigation delivery unit of about 40 ha in size taluka - Subdivision of a district  INDIA NABMADA RIVER DEVELOPMENT - GUJARAT WATER DELIVERY AND DRAINAGE PROJECT Table of Contents Page No. I. BACKGROUND ....... *..............*...**...*.**....* *.. *...... 1 Introduction ............... .................................. 1 Agriculture and Irrigation in India .......................... . 2 The State of Gujarat ....... ...... .......... ....... ... 2 The Narmada Basin Development .. .............. ................. 3 Past Bank Group Support for Irrigation and Power Development in Gujarat .......................... 5 II. TEE SARDAR SAROVAR PROJECT .................................... 6 General ............ ........................................... 6 Project Formulation, Preparation, and Objectives .............. 6 Salient Features of SSP .W............***.e..*................ 7 SSF Implementation Period 9..................... .......... 9 W-ater Supply .............................................. ...... ... 10 Rationale for Bank Involvement in Sardar Sarovar Project ...... 11 III. SSP CONCEPTS AND POLICIES . ....................... .......... ... . 12 Design Concepts ........... .. .. .............................................. 12 Water Allocation Criteria .... ..... ......... .............. .. .. .. 13 Service to Farmers .........*................................ ...... .... .. 14 Operation Concepts ..* ........................... ..... ........... *.......... i5 Operation and Maintenance Organization ......... ................ 16 SSP and Gujarat Medium Irrigation II Project .................. 17 Planning, Design, Construction, Operating, ande Maintenance Principals ................. ..................... 18 Environmental Effects ... ............... ............. 18 This report is based on the findings of appraisal missions that visited India in March, June, and September 1983, and comprised Messrs: P. Ljung, G. Fauss, C. Diewald, R. Vick, R. Goodland, G. LeMoigne (IDA); D. D. Taneja (IDAINDO); M. Barber, E. Frederiksen, L. Shanan, A. Dolyniuk, L. D. James, A. Gibbs, J. Brown, N. Cessna (consultants). The essential contribution of P. Ljung during project planning, formulation, pre-appraisal and appraisal stages are hereby gratefully acknowledged. Editing done by Ms. S Fellows and vord processing by Mr. J. Maddix, Ns. C. Batara, Mra. S. Douglas and Mrs. S. Vanjani.  IV. THE SARDAR SAROVAR PROJECT AREA ...................... *........... . 19 Climate .................................. ................ 19 The Land ....... . 20 Regionalization .. .... 22 The People .......... ... ........................... 22 Crops and Yields ......... . 24 V. THE PROJECT o .......... .......... . . . . . 26 Scope and Objectives . ........ .......a............ * .... 26 Detailed Features ................o.......... 26 Material Planning .......................................... 31 Implementation Schedule .. ...... . 32 VI. COST ESTIMATES AND FINANCING ...... .. .... 33 Project Cost Estimates ........................ ..... ..... 33 Operation and Maintenance Cost Estimates ...... ................ 33 Cost Sharing ......... . .... *. ,. * ...... 34 Financing ....... ......................... ... 34 Procurement .. . . . .. ..... 35 Disbursements .......... ... .. .................. 37 Accounts and Audits .. ........ o........... .-... - ........ 37 VII. ORGANIZATION AND MANAGEMENT ........... ....... .- .... . ... 38 General .................................... 38 Interstate Agencies ......................... .............. 38 Gujarat State Agencies . ................................... 39 Training .....e............................. 41 Technical Assistance ..................... .............. 43 Centralized Procurement Unit .................................. 44 Evaluation and Monitoring ............................. .... . 45 Project Operation and Maintenance ............................. 45 Supporting Services ...................... . .. . ........... ............... 47 VIII. AGRICULTURAL PRODUCTION. FARM INCOMES. AND COST RECOVERY ...... 49 Agricultural Production ...... ... . .. . . .* . .. a a *3......... a a a a a ....a 49 Market Prospects ..................................a a . . .......... 51 Farm Incomes .................................................. 52 Cost Recovery .......*.......a................................ 52 IX. BENEFITS. RISK. AND JUSTIFICATION ............................. 55 General ............... ................................. .... . 55 Agricultural Benefits ......................................... 55 Benefits from M&I Water Supply ................. ........*... 56 Benefits from Power Generation ............*.. ................. 57 Other Project Benefits ........................... . ..................... *. 57 Assumptions for Economic Analysis ............................. 58 Buildup of Benefits Over Time .... . a . a . a ............................... . 60  -iii- Economic Rate of Return for SSP: 'The Ba3e Case ................ 62 Project Risk . ................. * ............................... 64 X. AGREEMENTS To BE REACUED AND RECOMMENDATIONS .... .............. 69 Government of India * *....... ***so*....... ......................... 69 Government of Gujarat ............................................ 69 Recommendations ..................................... 72 Conditions of Effectiveness . ........................ ... ....... 72 Schedule A: Standards and Criteria for Planning, Design, Construction and OM of the Irrigation and Drainage and X&I Water Supply Facilities of the SSP ....... 73 TABLES 1. Priority Listing of Work Plan Topics of the Narmada Planning Group 2. Design and Construction Scheciule for Irrigation and Drainage Systems 3. Implementation Goals and Objectives 4. Description of General Soil Classes 5. Regional Profiles for Development 6. Main Canal - Salient Technical Features 7. Cross-drainage Structure Design Flood Criteria, Methodologies and Procedures 8. Annual Cement Requirements 9. Annual Steel Requirements 10. Detailed Cost Table - Main Canal 11. Detailed Cost Table - Branch Canal Systems 12. Detailed Cost Table - Distribution and Drainage Systems 13. Detailed Cost Table - Training and Technical Assistance 14. Detailed Cost Table - Summary Account by Project Component 15. Detailed Cost Table - Sum-may Account by Year 16. Detailed Cost Table - Projent Component by Year (Schedule of Expenditures) 17. Estimated Recurrent Operation, Maintenance and Energy Costs 18. Estimated Disbursement Schedule 19. Credit Allocation 20. Projected Cropping Pattern for SSP Command 21. Present Cropping Pattern in SSP Command 22. Incremental Agricultural Production (By Volume and Value) 23. Regional Changes in Average Net Farm Income from Crop Production 24. Projected Changes in Average Incomes and Land Rent from Crop Production 25. Cost of SSP Components by Year (22-years) 26. Sardar Sarovar Dam and Power Project, Recurrent Operation and Maintenance Costs 27. Economic Costs and Benefits Streams 28. Economic Evaluation of SSP by Functions  -1v- FIGURES 1. SSP Implementation Schedules Sheet 1 - Dam and Power Complex Sheet 2 - Conveyance, Distribution, and Drainage Development 2. Project Organization Chart - Opcration and Maintenance 3. Composition of Each Unit and Area Under Its Jurisdiction for Irrigation Service 4. Boundaries of O&M Organizational Units Within the Command Area 5. Lines of Communication, Farmer and Agency Units (DiM) 6. Example Position Qualifications and Typical Sequence of Advancement 7. Procurement Schedule for Civil Works - Main Canal 8. Procurement Schedule for Civil Works - Branch Canals 9. Procurement Schedule for Civil Works - Distribution and Draina4e Systems 10. Index of Area Under Crop in Gujarat 11. Index of Area Crop Yields in Gujarat 12. Index of Agricultural Production in Gujarat 13. Phasing of Economic Project Cost 14. Projected Water Use in Gujarat from Different Sources 15. Buildup of Project Benefits 16. Total Benefits and Costs Over Time 17. Sample Distribution of Economic Rate of Return MAPS 1. Command Area (IEn 17691) 2. Basin Projects (IBRD 17694) 3. Sardar Sarovar Dam and Power Complex (IBRD 17692) 4. Initial Development Area (IBRD 17693) 5. Depth to Water Table (IBRD 17940) 6. Water Quality and Aquifer Type (IBRD 17939) 7. Agroclimatic Conditions (IBRD 17b11) 8. Regional Soil Types (IBRD 17941) SUPPLEMENTARY DATA VOLUME (SDV) ANNEXES 1. Planning the Sardar Sarovar Project 2. Narmada Water Disputes Tribunal Final Order and Decision 3. Surface Water Resources 4. Groundwater Resources 5. Agriculture 6. Project Criteria and Plan of Operation 7. Groundwater Drainage and Conjunctive Use 8. Framework for Operation and Maintenance 9. Dam and Power Complex 10. Economic Analysis 11. Documents in Project File  INDIA NARMADA RIVER DEVELOPMENT - GUJARAT WATER DELIVERY AND DRAINAGE PROJECT I. BACKGROUND I1 Introduction 1.01 The Narmada River Development (NRD) comprises a multistate program for development of hydropower and irrigation dams and their associated irrigation canal networks on India's largest west flowing river (map IBRD 17691). Elements of the basinwide program are planned for construction over the next 40-50 years. This development would bring an additional 4-5 N ha of potentially valuable agricultural land, now prone to dro:,ht and scarcity, under irrigation. The NRD would also secure municipal and industrial (M&I) water supplies and bolster electric generating capacity within India's western region transmission grid by at least 2,700 SW. Over- all, the NRD would uplift the lives of about 11 N people in the states of Gujarat, Madhya Pradesh (MP), Rajasthan, and Maharashtra. 1.02 The Govenment of India (GOI) has sought Bank assistance in financing the first stage of the NRD-Gujarat or Sardar Sarovar Project (SSP), which would be the first in a series of about 30 major projects that are planned for development within the Narmada Basin. The SSP would form the basis of Gujarat's water planning for a significant portion of the state north of the Narmada River. It would be the largest irrigation project ever planned and implemented as one unit. Development of the SSP would take place over the next 22 years. The cost of construction at present prices is estimated at US$5,8b9 M. The SSP would irrigate about 1.9 H ha in Gujarat State and create the potential for irrigation of about 70,000 ha and/or provide municipal and industrial water supplies in Rajasthan, install 1450 KW f hydroelectric power generation at two plants, and supply about 1300 Mm'/year of M&I water. The SSP consists of a large dam and power complex on the Narmada River near Navagam village in Gujarat, including a large storage reservoir extending upstream for about 210 km in Gujarat, Maharashtra, and MP, and a canal network serving an irrigation command area extending about 440 km on the right bank northwest to the Rajasthan state boundary. 1.03 The proposed Bank lending operation would assist two SSP elements simultaneously as follows: / This chapter is in large parts identical to the corresponding chapter in SAR No. 5107-IN, titled "Sardar Sarovar Dam and Power Complex."  -2- (a) an IBRD loan and IDA credit of USS200 X and US4100 M, respectively, towards the cost of constructing the dam and power complex during 19b4/85 through 1994/95; and (b) an IDA credit of US$150 M towards the cost of constructing the canal network during the years 1984/85 through 1988/89. The operation is described in two staff appraisal reports (SARs), "Sardar Sarovar Dam and Power Project," Report no. 5107-IN and "Water Delivery and Drainage Project", Report no. 5108-IN; a "Supplementary Data Volume." (SDV) comprising ten technical annexes; and a list of documents on file. 1.04 The IDA assisted project described in this SAR would finance a three year time slice of the SSP water delivery and drainage systems over the period 1984/85 through 1987/88 to be completed at an estimated cost of USS521 H. The proposed IDA credit of USS150 M would finance about 30% of the estimated project cost, net of taxes and duties. Financing would be provided by the states of Gujarat and Rajasthan to the extent the latter is obligated under the Narmada Water Disputes Tribunal (NWDT) decision. Agriculture and Irrigation in India 1/ 1.05 India. India is a large and diverse country with a population of over 700 M and an annual per capita income of about US0250. The economy is dominated by agriculture, which employs more than two-thirds of the labor force and accounts for about 40% of GDP. Sluggish agricultural growth (2.3Z a year since 1950) combined with temporary setbacks caused by poor monsoons have been factors retarding the economy. Despite intensive public investment having more than doubled to about 25% of GDP, India continues to suffer from inadequate infrastructure facilities, especially water distribution to drought prone areas, power, and shortages of key materials. As a result, the economic growth rate has averaged a moderate 3.6% a year since 1950. In attempts to raise levels of economic growth, GOI has devoted considerable resources to irrigation development. The State of Guiarat 2/ 1.06 General. The state of Gujarat covers an area of 19,600 kn2, and has a population of about 36 M (1983) growing at an annual rate of 2.5%. It is relatively urbanized and has a large and fast growing manufacturing sector. Between 1960 and 1982 the state's income grew at an annual rate of 3.7% and per capita income reached in 1983 a level of USS320, considerably higher than the all-India level (US$250). Agriculture accounts for more than one third of the state's income and fcFr more than 60% of the working population (1981). /J Detailed review is in *k.conomic Situation and Prospects of India,." IBRD Report No. 4962-IN, April, 1984. ]/ Greater details are in SDV, annex 1, "Planning the Sardar Sarovar Project.."  -3- Moreover, agriculture-based industries account for more than 50% of all factory employment. Agricultural production largely depends on weather conditions, since much of Gujarat is characterized "y low and highly variable rainfall. This, and the limited irrigation facilities, have made the state susceptible to drought and famine. Since 1900, severe food shortages due to drought have been experienced at least 25 times. Consequently, the Govern- ment of Gujarat (GOG) has given a high priority to irrigation development. 1.07 The Irrigation Subsector. The ultimate irrigation potential, and the potential created and utilized are sunmarized as follows: Ultimate Irrigation Potential Potential Created Potential Utilized