India - Maharashtra Water Utilization Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 4349-IN STAFF APPRAISAL REPORT INDIA MAHARASHTRA WATER UTILIZATION PROJECT May 20, 1983 South Asia Project 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 US$ 1.00 = Rupees (Rs) 9.50 1/ WEIGHTS AND MEASURES (METRIC SYSTEM) 1 meter (m) = 3.28 feet (ft) 1 kilometer (km) = 0.62 miles (mi) 1 hectare (ha) = 2.47 acres (ac) I million cubic meters (Mm3) = 810 acre3feet (ac-ft) 1 thousand million cubic feet (TMC) = 28.32 Mm 1 cubic foot per second (cfs or cusec)= 0.028 cubic meters per second (m3/s) 1 ton = 1,000 kilograms (kg) 1 ton = 2,205 pounds (lb) I/ The US Dollar/Rupee exchange rate is subject to cnange. Conversions of cost estimates in this report have been made at US$ 1.00 to Rs 9.5, which represents the projected exchange rate over the disbursement period.  FOR OFFICIAL USE ONLY PRINCIPAL ABBREVIATIONS AND ACRONYMS USED AA - Agricultural Assistant (or Village Level Worker) AD - Agriculture Department AE - Assistant Engineer AO - Agricultural Officer ARDC - Agricultural Refinance and Development Corporation BC - Black Cotton CAC - Canal Advisory Committee CAD - Command Area Development CADA - Command Area Development Authority CCA - Cultivable Command Area CI - Canal Inspector DSCS - District Soil Conservation Service EE - Executive Engineer ERR - Economic Rate of Return GES - Guaranteed Employment Scheme GOI - Government of India GOM - Government of Maharashtra J{YV - High Yielding Varieties ICB - International Competitive Bidding ID - Irrigation Department JE - Junior Engineer LDA - Land Development Assistant M - Million MIP I - (first) Maharashtra Irrigation Project MIP II - Maharashtra Irrigation II Project MLDC - Maharashtra Land Development Corporation MWUP - Maharashtra Water Utilization Project NABARD - National Bank for Agriculture and Rural Development OC - Outlet Committee ODSD - On-Farm Development Structures Division OER - Official Exchange Rate O&M - Operation and Maintenance PWD - Public Works Department RWS - Rotational Water Supply SCS - Soil Conservation Service SE - Superintending Engineer SMS - Subject Matter Specialist T&V - Training and Visit (System of Agricultural Extension) TcD - Trial-cum-Demonstration VEW - Village Extension Worker WALMI - Water and Land Management Institute WMRD - Water Management Research Division WUC - Water Utilization Committee 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 Chak - Block or irrigation service area below the Government outlet. Kharif - Wet Season (June to October) Rabi - Winter Season (November to March) Taluk - Sub-division of a district Field irrigation channel - Irrigation channel from the Government outlet to individual farms Minor - Irrigation canal with capacity less than 0.7 m3/s and serving the chaks Zilla Parishad - District Level Authority Panchayat - Village Council Distributary - Irrigation canal with capacity more than 0.7 m3/s Field drainage channel - Drainage channel within the chak serving the individual farms. Murrum - Granular material derived from eroded basalt formations. FISCAL YEAR Government of Maharashtra and Agencies - April 1 - March 31 NABARD, Cooperatives - July 1 - June 30 Commercial Banks - January 1 - December 31   INDIA MAHARASHTRA WATER UTILIZATION PROJECT Staff Appraisal Report Table of Contents Page No. I. BACKGROUND .................................................. 1 Agriculture and Irrigation in India ...................... 1 Agriculture in Maharashtra .............................. 2 Irrigation in Maharashtra ............................... 3 Previous Bank Group Assistance in Irrigation .............. 4 Project Formulation ..................................... 7 II. THE PROJECT AREAS ........................................... 8 General ................................................. 8 Climate, Topography and Soils ........................... 8 Population and Land Ownership ........................... 9 Irrigation Development .................................. 10 Cropping Patterns and Yields ............................ 12 Farmers' Support Services ............................... 12 III. THE PROJECT ................................................ 14 Project Scope and Objectives .............................. 14 Infrastructure and Equipment ............................ 15 Survey, Design and Construction Standards .... ........... 17 Land Shaping ............................................ 17 Adaptive Agricultural Research and Extension . ........... 18 Improved System Operations .............................. 19 Training ........... ..................................... 20 Water Supply and Demand ................................. 22 Implementation Schedule ................................. 22 This report is based on the findings of a Bank Mission which visited India in November/December 1982, and comprised of: Messrs. W.A. van Tuijl, P. Dax and A. Seager (Bank), Y. Pret and R.K. Sabherwal (Bank, New Delhi Office, part-time), and Dr. Karmeli (Consultant, part-time). Mr. M. Herman assisted with the economic analysis. The word processing was done by Mrs. P. Waiter.  -ii- IV. COST ESTIMATES AND FINANCIAL ARRANGEMENTS ........ .......... 23 Financing ............................................... 24 Procurement ............................................. 24 Disbursements ........................................... 25 Accounts and Audits ..................................... 26 V. ORGANIZATION AND MANAGEMENT ............................. ... 26 General ................................................. 26 Command Area Development (CAD) Organization .... ......... 26 Design and Construction ................................. 27 Quality Control and Commissioning ....................... 28 Operation and Maintenance ............................... 28 Engineering Staff and Training ............................ 29 Land Shaping ............................................. 29 Farmers Organizations ................................... 30 Engineering Research, Monitoring and Evaluation .... ...... 31 VI. AGRICULTURAL PRODUCTION, FARM INCOMES AND PROJECT IMPACT AND COST RECOVERY .............................................. 33 Agricultural Production and Yields ...................... 33 Farm Incomes ............................................ 34 Project Impact .......................................... 35 Cost Recovery ........................................... 36 Watercharge Collection Performance ........................ 37 VII. ECONOMIC ANALYSIS, RISK AND SENSITIVITY ................... 38 General ................................................. 38 Prices and Economic Analysis ............................ 38 Sensitivity and Risk .................................... 39 VIII. AGREEMENTS REACHED AND RECOMMENDATIONS ........ .. ........... 40  -i ii- ANNEXES ANNEX 1 Supporting Tables and Charts T-1 Results from Pilot and Farmers Project T-2 Climatic Data T-3 Size Distribution of Holdings in the Project Areas T-4 Present and Expected Land and Stored Water Utilization:Jayakwadi T-5 Present and Expected Land and Stored Water Utilization:Purna T-6 Present and Expected Land and Stored Water Utilization:Girna T-7 Present and Expected Land and Stored Water Utilization:Mula T-8 Present and Expected Land and Stored Water Utilization: Khadakwasla T-9 Water Balance and Irrigable Areas with the Project T-10 Present and Future Irrigated Areas and Cropping Intensities in the Project Areas T-11 Present and Expected Future Yields T-12 Details of Present and Planned Systems Operations T-13-23 Cost Estimates T-24 Estimated Schedule of Disbursement T-25 Proposed Credit Allocation T-26 Quality Control T-27 Required Training at WALMI and Creation of Posts T-28 Staff Requirements for Implementation T-29 Agricultural Production T-30 Crop Budgets and Typical Farm Budget T-31 Price Estimates and Forecasts T-32 Costs and Benefits Streams for Economic Analysis CHARTS C-1 Typical CADA Organization at State and Regional Level C-2 Typical CADA Organization at Project Level C-3 Implementation Schedule ANNEX 2 Criteria for Survey, Planning, Design and Construction of Minors and Field Channels ANNEX 3 Scope of Work for Water Management Research Division and On-Farm Development Structures Division  -iv- ANNEX 4 Adaptive Research ANNEX 5 Training Centers and Training ANNEX 6 Related Documents and Data Available in Project File MAPS IBRD 17058 Project Location IBRD 16997 Jayakwadi and Purna Schemes IBRD 16996 Girna Scheme IBRD 16995 Mula Scheme IBRD 17057 Khadakwasla Scheme  INDIA MAHARASHTRA WATER UTILIZATION PROJECT I. BACKGROUND Agriculture and Irrigation in India 1.01 India has a population of about 684 M which is growing at an annual rate of about 2.1%. Since 1960, per capita income grew at an annual rate of 1.2% and reached US$240 in 1980. Although the average per capita income has increased and access to public services has improved, there has been, in general, little change in the incomes of the urban and rural poor, who com- prise about 50% of the total population. Accordingly, GOI's development plans give priority to alleviating poverty, increasing production and incomes, and creating productive employment, especially in rural areas. 1.02 Agriculture is the dominant sector of the Indian economy; it con- tributes about 40% of GNP. It engages about 70% of the labor force and provides the base for about 45% of India's exports. GOI has devoted con- siderable resources to agricultural development, especially irrigation. 1.03 Irrigation development had high priority since the beginning of the planning era in 1950. Some 57 M ha were developed by 1980/81, of which about 58% receive water from surface sources and 42% from groundwater. In recent years, the irrigated area has been expanding by about 2-3 M ha annually. It is estimated that increased production resulting from investment in irriga- tion has accounted for at least three-quarters of agricultural growth since 1960. Presently, irrigated agriculture accounts for about 60% of all agricultural output in India. However, for a number of reasons, production levels in much of the irrigated area, especially the area irrigated from surface sources, are considerably lower than the potential. 1.04 At Independence, Indian irrigation systems commanded some 23 M ha. Many were planned to provide famine protection, had limited or no storage and did not have sufficient water control structures. Water supply was largely unreliable. Irrigation projects built in the early 1960s typically involved a storage or diversion dlam and only the main conveyance system, leaving to the farmers the construction of the distribution system from canal outlets to individual fields. As some of these outlets served areas in excess of 100, or even 200 ha, conveyance of water to the farmgate required construction of minor channel networks that were often several kilometers long. In most projects, farmers were unable to finance or organize construction of the field channels without outside assistance, which was rarely available. This resulted in considerable delays in utilizing water from the irrigation potential created. 1.05 The concept of a Command Area Development Authority (CADA) evolved in the early 1970s. The main objectives of CADA were to coordinate the activities of the State Irrigation and Agriculture Departments, to assist farmers in obtaining institutional credit for the construction of field  -2- channels, and for land development. Achievements have been below expecta- tions: coordination was not entirely effective, and the attempt to finance on-farm development through institutional credit (generally refinanced through the Agricultural Refinance and Development Corporation, or ARDC 1/) was generally not successful because farmers had no confidence in the reliability of water supply and were therefore reluctant to undertake loan repayment obligations. Also, no facility or framework for effective group action had been developed in the irrigation sector to implement such projects. This experience indicates that: (a) more emphasis is required on improving the efficiency and reliability of the conveyance system from the water source to the irrigation outlets; (b) Government should assume greater responsibility for conveying water to an outlet closer to the farmgate, to facilitate construction of watercourses conveying water to each individual field; and (c) Government should promote the development of effective farmer involvement by providing the necessary mechanism, framework and support for efficient group action and cooperation among irrigators. There are clear indications that when the farmers are confident that thiey will receive a reliable water supply, they will take steps to make full use of the water supplied. These concepts have been used in the design of the proposed project. Agriculture in Maharasthra 1.06 Maharasthra covers an area of 30.8 M ha and has a population of 62.7 M (1981). Although, by Indian standards, the State is highly urbanized and industrialized, two-thirds of the labor force is employed in agriculture. Since the early 1960's agricultural growth has been sluggish (0.7% p.a.). Manufacturing has expanded more rapidly (4.8% p.a.) but the fastest-growing industrial activities (chemicals, engineering, etc.) have been capi- tal-intensive. Much of the industrial growth and related economic activities have been concentrated in Bombay and Pune--leading to urban congestion and widening regional income disparities. Thus, GOM views increased farm prodluc- tivity as a prerequisite to a more rapid and balanced overall economic development. 1.07 Agriculture contributes 30-35% to the State's income and employs some 62% of the landless labor force. About 43% of the agricultural labor force is landless. 18.2 M ha (59% of the area) is under cultivation and there is little scope for increasing the net sown area. The cropping intensity is among the lowest in India (110%) and cannot be increased substantially 1/ ARDC ceased to exist as of July 12, 1982. The refinance functions and obligations of ARDC were assumed by the National Bank for Agriculture and Rural Development (NABARD), a GOI undertaking which was formally con- stituted on the above date.  -3- without irrigation. The average farm size is 3.7 ha, with significant varia- tions from district to district. About 92% of the holdings are owner-occupied, 5% are partly owned and partly rented and 3% are wholly rented. Even in a normal year, about 50% of the rural population has incomes below the poverty line (US$ 90). Cereals (sorghum, millets, paddy, wheat and pulses) account for about 60% of the gross cropped area. Yields are low and the State is deficient in food-grains. The rate of agricultural growth has picked up in the first half of the seventies, following a succession of favorable monsoons, and in response to GOM's agricultural development programs. In particular, high yielding varieties of kharif sorghum, paddy and wheat have gained wide acceptance. Other dynamic aspects of agricultural performance have been the growth of irrigated sugarcane and horticultural crops and the rapid increase in fertilizer consumption, at an annual rate of about 8%. However, foodcrop production did not show a discernible growth in the five year period 1976/77 to 1980/81. 1.08 Present irrigation standards reflect the main objective of past Government irrigation policy: to provide drought protection over extensive areas planted to foodgrains. Improved, high-yielding crop varieties, the spread of modern agricultural practices and the introduction of more complex and diversified cropping patterns are putting new demands on irrigation systems. Better irrigation design and operation standards have become neces- sary to meet the need for more reliable water supplies. Irrigation in Maharashtra 1.09 The water resources potential of MaharashLra is limited by the seasonality of the major rivers, and by topography. Out of a gross cropped area of 20.0 M ha, only 2.5 M ha is now irrigated, of which 1.1 M ha is from wells. This amounts to 12.5% of the gross cropped area, less than half the national average. The present irrigation potential is estimated at 6.3 M ha. Assuming improvements in irrigation efficiencies, the ultimate potential could be as high as 8.9 M ha, including 2.7 M ha from groundwater sources 1/. In turn, this calls for distribution systems reaching the farm outlets, for improved operation of conveyance systems and for the systematic introduction of rotational water supply to provide equitable access to water for farmers in the command areas. 1.10 Groundwater resources are substantial, but easy opportunities for well development have already been utilized. At Independence, some 0.5 M ha was irrigated from wells. Groundwater development increased rapidly (4.2% p.a.) during the 1950's. During the 1960s and early 1970s the well-irrigated area increased further, partly because of replacement of traditional 1/ This would require increases in irrigation efficiencies from the present average 25-30% to about 50%.  -4- animal-operated water lifts by electric and diesel pumps. Individual and cooperative river lift irrigation schemes have also spread. These invest- ments--largely carried out by the private sector--have been a major engine of agricultural growth. IDA has contributed to these developments through financing rural electrification and agricultural credit projects 1/. 1.11 Between Independence and the late seventies GOM has invested the equivalent of US$1.3 billion in major and medium surface irrigation schemes, adding 870,000 ha to the irrigation potential of the State. This implies a cost of US$1,500 per ha, a reasonable level by international standards, but 40% higher than the all-India average. Seasonality of river flows, lack of major storage possibilities, difficult soil conditions and the GOM policy of spreading irrigation benefits over wide areas helps explain the relatively high costs. Returns on this capital could be substantially enhanced by correcting deficiencies in planning, design, construction and operating standards. Previous Bank Group Assistance in Irrigation 1.12 IDA's first credit for irrigation in Maharashtra for the Purna Irrigation Project (Credit 23-IN for US$ 13 M), was approved in July 1962. The main works included a dam at Yeldari, a re-regulating reservoir at Sid- heshwar, about 86 kms of main canal and 400 kms of distributaries, to irrigate some 61,000 ha. This scheme was completed in the early 1970s. 2/ However, agricultural production in the project area increased only slowly due to, inter alia, an inadequately constructed irrigation conveyance systema, lack of coordinated crop and water planning, and drainage deficiencies. 1.13 A US$70 M credit (Credit 736-IN) was approved in October 1977 for the (first) Maharashtra Irrigation Project (MIP I) which included completion of on-going construction of irrigation infrastructure to serve 95,000 ha in the Jayakwadi Scheme, land shaping and field channels over 45,000 ha, as well as rehabilitation of the irrigation distribution system and drainage con- struction in the Purna Scheme over 30,000 ha. Approximately 84% of this credit has been disbursed; the scheme is scheduled for compLetion by 1984. The main problem with the project has been the initial poor quality of con- struction. However, the Irrigation Department has since improved its techni- cal standards and is making the necessary repairs. 1.14 IDA approved in October 1979 a US$210 M credit (Credit 954-IN) for the Maharashtra Irrigation II Project (MIP II). This credit finances a five 1/ Credits 911-IN, 572-IN, 540-IN, 715-IN and 293-IN. 2/ Bank's Operations Evaluations Department had not yet been set up, so Project Performance Audit was not undertaken.  year time slice of a composite project consisting of five new irrigatior. schemes (Upper Wardha, Upper Penganga, Kukadi, Krishna and Warna), and priority work in two existing schemes, Mula and Girna, all located in the drought-prone Deccan plateau.l/ MIP II would bring some 147,000 ha of land under irrigation. The total area commanded by the six new schemes would ultimately comprise about 620,000 ha. The project aims to increase water use efficiency and to guarantee a timely and reliable water supply at the farm outlet. For the six new projects, this is proposed to be achieved through better planning criteria, improved design standards (including addi- tional cross regulators and canal lining down to the 8 ha units), and better construction standards and operational procedures, including rotational water supply. Improvement works are still on-going in the Girna and Mula schemes and mainly aim at the removal of major bottlenecks in the existing conveyance system, selective lining and additional water control structures. Two spe- cial features of the MIP II will be highlighted as they are closely related to the proposed project (i) the Pilot and Farmers Project and (ii) the Water and Land Management Institute (WALMI). 1.15 Pilot and Farmers Project. The MIP II includes a component for pilot water management, to identify appropriate conveyance technologies for the minor water distribution system. Pilot schemes were started in 1979; by the end of 1982 approximately 4,000 ha had been furnished with fully lined minores and field channels to the individual farms. As this type of development was found to be rather expensive (Rs 4,000 per ha) another type of pilot effort was initiated in 1980, which became known as the "Farmers Project". It differed mainly in the extent of lining provided which was reduced to 10-15% of total length, and costs to about Rs 2,000 per ha. By the end of Decem- ber 1982 about 6,000 ha had been completed under the Farmers Project, mostly in the Jayakwadi Scheme, in areas that had not been included in MIP I (para 1.13). In these areas the utilization of irrigation water had been very low mainly due to lack of proper terminal irrigation facilities. The works carried out consisted of reshaping and, where necessary, extending existing minors and field channels; reducing the size of tertiary units (chaks) sometimes commanding more than 100 ha, to more manageable 20-25 ha units; constructing a measuring device at the head of the chak; selective lining of field channels and minors; construction of additicnal control structures such as drops, turnouts etc.; construction of service roads along minors; and the introduction of better system operation and irrigation scheduling. The impact of the Pilot and Farmers Project on the agricultural production has been quite remarkable (Annex 1, T-1). 1.16 Water and Land Management Institute (WALMI). Actual utilization of the irrigation potential, which has been created since Independence 1/ One additional new scheme, Bhima, also appraised by IDA, is being financed by IFAD.  -6- (para 1.11), has not been up to expectations, mainly because of inadequate development of the minor canal commands and lack of good canal system manage- ment. An important finding of the MIP II preparation was that few of CADA's personnel had the necessary specialized skills in water management and land development. To overcome this bottleneck, it was agreed that under MIP II GOM would train the irrigation engineers within CADA organizations in these subjects, and they would then gradually take over management of all public- sector major and medium irrigation projects in the State. It was agreed that, as a first step in the long-term program, GOM would commence vocational training in water management and land development. For this purpose IDA agreed to finance the establishment and operating costs (up to October 1984) of WALMI, involving IDA financing of US$3.8 M out of an estimated total of US$5.7 M. 1.17 WALMI has a 65 ha campus near Aurargabad. It is being provided with appropriate training facilities, accommodation for the trainees, a library, a 40 ha demonstration farm and computer facilities. The buildings have been completed to the extent that the training programs can proceed on schedule. The 20-man teaching cadre of the faculty is now at full strength. The Direc- tor of the Institute is a Chief Engineer on deputation from the Irrigation Department (ID). There are three faculties: agriculture, engineering and science. The WALMI conducts four different types of courses: (a) There is a course each year for degree holders, lasting 12 months, and another for diploma holders, lasting 10 months. Plant science, soil science, soil-water-plant relationships, irrigation engineering, land development, drainage engineering, hydraulics, statistics, social science, agricultural extension, economics and computer programming are taught. A special feature of the course is that it includes a four-month practical exercise when the trainee does actual survey, planning and design work. By May 1983, 108 Junior Engineers (JEs) will have been trained. (b) Four short-term courses of eight weeks duration are being conducted each year for senior officers like Assistant Engineers (AEs) and Executive Engineers (EEs). The course imparts a working knowledge of various aspects of irrigated agriculture. One of the four courses is specially designed for agricultural officers. So far 200 officers have been trained. (c) Special courses of about 1-2 weeks are conducted on special subjects for senior officers; Superintending Engineers (SEs), CADA Administrators and EEs. Also, a special eight-week course has been conducted for 30 JEs working on the Farmers Project. (d) Trainers courses are planned for the trainers of Canal Inspectors (CIs), Agricultural Assistants (AAs), etc.  -7- Project Formulation 1.18 The project is the direct result of GOM's wish to extend the success- ful Farmers Project (para 1.15) to other areas where the absence of properly designed and constructed irrigation facilities (particularly below the minor outlet) has proven to be a major constraint in irrigation development and has led to under-utilization of irrigation water. The emphasis is therefore on improving the irrigation system within the command of the minor. These improvements would be undertaken according to design criteria that have evoled from experience gained in the Farmers Project. Some other necessary improvements in the infrastructure would also be included, such as improve- ments to distributaries, drainage, and for better operation, the provision of canal service roads. An important aspect of the project is that, to ensure quality of design and construction, all engineers working on the project would be WALMI trained. 1.19 In addition to the construction of infrastructure, the project would include a number of other features which aim to induce the farmers to make more intensive use of the available water supply: (i) improved system opera- tions, to provide a more reliable water supply to chak outlets and individual farms (including training of canal operating staff); (ii) the setting-up of farmers organizations for a more systematic involvement of farmers in the design of the project and its subsequent operation and maintenance, and to improve communication between project management and farmers; (iii) an adap- tive research program aimed at finding appropriate recommendations for suitable on-farm irrigation practices, cropping sequences and farming sys- tems, and input levels suited to the farmers financial resources; (iv) promo- tion of land shaping through the farmers own efforts, with assistance from staff of the Maharashtra Land Development Corporation (MLDC); (v) farmer training in irrigated agriculture, and; (vi) an attitude survey to monitor farmers reaction to, and utilization of, the improved irrigation system. 1.20 The size of the project (about 95,000 ha to be implemented in five years) was determined by the output of trained engineering staff from WALMI to undertake the design and implementation of the irrigation facilities, without hampering on-going efforts in the MIP I and MIP II. 1.21 Location of project areas within the scheme command areas were deter- mined (i) to ensure adequate water supply from major conveyance channels, (ii) to minimize overlap with other IDA financed activities, and (iii) to select areas with lower than average water utilization rates. 1.22 The project is the outcome of the first large scale venture in India for carrying out a full well-tried (on 10,000 ha) package of closely linked water management improvements (organizational, manpower training, upgrading commissioning of the minor distribution network, the spread of RWS) aimed specifically at more rapid utilization of existing irrigation systems. It is  -8- intended to pioneer long overdue initiatives, in a program of mutually sup- portive components, to make better use of existing irrigation facilities. The project would be replicable in most other existing irrigation schemes in the State. II. THE PROJECT AREAS General 2.01 The project areas, totalling about 95,000 ha, are located in five existing irrigation schemes commanding more than 0.5 M ha: the Jayakwadi, Purna, Mula, Girna and Khadakwasla Schemes. The schemes are located on the drought-prone Deccan plateau, in the central and eastern parts of Maharashtra (Map 17058). They were started in the 1960s to overcome agricultural produc- tion constraints brought about by the low and uncertain rainfall. 2.02 The scheme areas are served by main road and rail links, which are part of the Statewide network and the all-India system. The main roads link the project areas to the industrial and commercial centers of Bombay, Pune, Nagpur, Aurangabad and Nasik, and to Delhi, Calcutta, Hyderabad and Ban- galore, beyond the State bondaries. Market centers are promoted under an ongoing GOM program to meet expected levels of marketable surplus, resulting from planned irrigation development. Electric power is available in all the scheme areas, and GOM has an ongoing program of rural electrification. Domestic water supplies are largely restricted to urban areas. Public health services are backed by a network of health centers and hospitals. Public administration is structured around the elective district level authority (Zilla Parishad) and the village council (Panchayat). Climate, Topography and Soils 2.03 Climate. The plateau east of the north-south mountain range (the Ghats) is about 500-700m above sea level, slopes eastward and is sheltered from maritime influences by the Ghats. This gives rise to a moderate winter (November-March), the rabi, a dry hot season (April-June), and monsoon rains (July-October), the kharif. Temperature (Annex 1, T-2), with few exceptions, does not impose any constraint on continuous cropping. The exceptions are maize, which may suffer from pollen sterility in the dry hot season; wheat, which requires cool weather for tillering and ear initiation and therefore yields well only when winters are exceptionally cool; gram (chickpea), which only flowers when daylight hours are diminishing and is therefore always a winter crop. All other major crops - sorghum, cotton, millet, sugarcane, bananas - thrive throughout the year, constrained only by availability of water, be it rainfall or irrigation.  -9- 2.04 Past the eastern foothills of the Ghats rainfall increases from west to east. The rainfall zones with range of rainfall, and location of the project areas, is as follows: Rainfall Zone Rainfall (mm) Project Area scarcity 600-750 Girna (part); Mula; Khadakwasla assured 750-1000 Girna (part); Jayakwadi (part) moderate 1000-1300 Jayakwadi (part); Purna high over 1300 Since the rainy season is only 3-3 1/2 month long, irrigation is necessary for the remainder of the year and even in the rainy season, when there may be prolonged periods without precipitation. 2.05 Topography. The plateau area is gently rolling anid generally not deeply incised, except for the valleys of major rivers. Slopes are steep enough to make basin irrigation a difiicult process and therefore land shap- ing, adoption of more sophisticated border or furrow irrigation, and growing crops on ridges or raised beds is necessary to attain potential yields. For parts of the project areas rough landshaping had been carried out in the past and would need further improvement. Also, natural drainage is not adequate to deal with the at times intensive rainfall (100 mm in 24 hours). 2.06 Soils. Black swelling heavy clay soils (locally called black cotton (BC) soils) cover most of the project areas. In parts of the Mula project area somewhat lighter soils can be found. The soils are all of basaltic origin, formed in situ and therefore of varying depth. The major mineral is a shrinking, self-mulching, montmorillitic clay which, when wet, tends to be plastic, structureless and of low bearing capacity. The soils are difficult to work during the rainy season and also difficult to irrigate. Therefore traditional, non-irrigated agriculture relies heavily on cropping early in the winter season, using residual soil moisture. Population and Land Ownership 2.07 The total number of farm holdings in the project areas is estimated between 20,000 and 25,000. The population which depends on agriculture as their main source of income is estimated at around 200,000. The average size of landholdings is relatively large by Indian standards: more than 60% of the holdings are over 4 ha (except in Girna, where the proportion is only 35-40%). The proportion of holdings less than I ha is under 15% (except Girna, where this proportion is 20%) (see Annex 1, T-3). 2.08 A decade ago the average farm size was still about 6.5 ha. The decrease in farm size reflects in part the sub-division of holdings as population increases, and may also be a response to the Land Ceilings Act of  1971, which imposed limitations on the size of holding: (i) 7 ha for peren- nially irrigated land; (ii) 11 ha for land with seasonally assured water supply; (iii) 14 ha for irrigated land without assured water supply; (iv) 22 ha for unirrigated land. Irrigation Development 2.09 Most of the main infrastructure in the scheme areas, such as dams and reservoirs, main canals and branch channels, has been completed and, within the project areas, also the minor irrigation networks. IDA is already assisting the financing of irrigation works in the Jayakwadi, Purna, Girna and Mula Schemes (paras 1.13 and 1.14). The Khadakwasla Scheme is the only one in which IDA has not been involved before. Within this scheme, the proposed project area (8,600 ha) is only a small portion of a much larger development. The Mutha River, which supplies water to the Khadakwasla com- mand area, is regulated by two storage dams. A third storage dam, the Varas- gaon Dam is presently under construction and scheduled for completion by 1986. This additional storage facility would extend the present scheme from 41,210 ha to 101,600 ha. 2.10 The general condition of the main and branch canals that would convey the required supplies to the project areas is satisfactory. Repairs are being made to the lining of the two main canals in Jayakwadi. There were some bottlenecks in the Girna and Mula branch canals but these are currently being rectified under MIP II. For the Khadalkwasla project area water would be supplied through the new Mutha right bank canal which is fully lined and completed up to the Bhigwan Branch Canal (Map 17057). 2.11 Present water utilization in the project areas is :Low, particularly in the kharif season. The Farmers Project demonstrated that the major con- straints are deficiencies in the irrigation distribution system, espcially in the minors and field channels, which makes good system operations virtually impossible and results in an inadequate and unreliable water supply at the farm level (para 1.15). Other constraints are (i) lack of farmers experience in irrigating the difficult BC soils, (ii) absence of, or inadequate, land shaping (para 2.05) and (iii) the fact that no suitable recommendations on irrigation practices have yet been developed for the BC soils. The present rate of water utilization in the project areas may be summarized as follows:  Command Areas (ha) MWUP Irrigation Intensities (%) I/ Scheme Areas Project Areas Present 2/ Potential 3/ Jayakwadi 183,000 42,350 31 113 Purna 78,500 10,500 51 84 Girna 79,300 11,030 26 49 Mula 118,200 21,970 26 61 Khadakwasla 101,600 8,600 10 64 560,600 94,450 1/ for canal irrigation only; excludes groundwater (para 2.16) 2/ in project area 3/ at full development, assuming uniform water use in each scheme area. (see also Annex 1, T-9). 2.12 The main problems with the minor irrigation and field channel network are: (a) deficiencies in layout of the minors, resulting in chaks that are too large to be handled by the number of farmers served; improper alignment of field channels resulting in unirrigable areas; field channels that are too long, creating problems for the farmers at the tail end, and a field channel layout that does not serve all farms; (b) deficiencies in canal cross sections (which may be either insufficient, eroded, show excessive leakage or obstruct flow because of excessive vegetationa); (c) improper canal bed slope, either too steep, causing erosion, or too flat, causing siltation; (d) serious deficiencies in structures: deterioration or collapse (especially in BC soils), abseace of structures (particularly water measuring devices) and improper location of structures. 2.13 Field drainage channels for draining the individual farms are lack- ing, as are the link drains to connect the field drainage channels to the major natural drainage system. The major drainage system also needs improve- ment; mostly removal of weeds and local bottlenecks. 2.14 The distributaries in the project areas generally have insufficient cross regulators; gates are missing, aad structures need repair or complete replacement. The Purna Tail Distributary lacks service road bridges over  -1.2- major drainage channels. Some canal sections have inadequate capacity because of weed growth and siltation. On the distributaries in BC soils in Mula and Khadakwasla many of the structures are broken beyond repair because of inadequate foundation design. 2.15 Access along the canals is difficult. Service roads are generally poor, or have not been provided along the smaller canals. This makes proper supervision and operation of the canal network impossible. 2.16 Except in Jayakwadi, groundwater is being pumped from dug wells which tap the low yielding Deccan trap aquifers. It is mainly used for the profitable sugarcane and banana crops. Groundwater is used more where canal water is more intensively utilized, probably because such farmers can afford to invest in wells. Statistics on the use of groundwater are inadequate. In the Mula Scheme, however, they show that in the head reach 16% of the CCA (or 2,400 ha) is being irrigated from wells. Cropping Patterns and Yields 2.17 The field crops are sorghum in both the rabi and kharif season, pearl millet and pulses in kharif, short-stapled (desi) cotton in the kharif long-stapled, usually hybrid, cotton, which either starts in the hot season and finishes in the kharif or starts in the kharif and finishes in the rabi. Groundnuts are grown either in the hot season or in the kharif; yields of the former are usually higher. Other rabi crops are wheat and gram (chickpeas), although wheat is at its ecological limit because of the usually warm weather in December and January and the rapid rise of temperature in March,when the wheat ripens. Other important crops are chillies and onions and, in some areas, leaf and other vegetables, grown more or less continuously on canal or well water. The presenat somewhat rigid water allocation system does not allow canal water to be used in well irrigated areas. In Mula and Khadak- wasla this system is changing and the conjunctive use of canal and well water is gaining in importance. Annex 1, T-4 to T-8 show the cropping pattern on the canal irrigated areas; T-ll, the yields. Farmers Support Services 2.18 Agricultural Extension. Agricuiltural Extension in the State is being organized to the "T&V" (Training and Visit) system under the IDA-support-ed Maharashtra Agricultural Extension Project (Cr. 1135-IN). Staff are being built up to provide one Agricultural Assistant (AA) (the term used for Vil- lage Extension Workers in Maharashtra) for every 6-800 farm families. A more recent development is to assign AA-s eLther to irrigated or non-irrigated areas, to enable them, and, as far as 13ossible also their supervisors, to focus either on the problems of irrigated or non-irrigated agriculture. This is a most welcome development which, if properly supported with well-designed adaptive research, will go a long way rowards providing relevant advice to irrigating farmers.  -13- 2.19 Agricultural Research. Agricultural research, which has a long and distinguished history in the State, is currently supported by IDA under the National Agricultural Research Project (Cr. 855-IN). The two lead univer- sities for the project areas are the Rahuri (for Mula, Girna, Khadakwasla) and Parbhani University (for Jayakwadi, Purna). Assisted to varying degrees by the Universities, the CADA's and DA are operating Trial-cum-Demonstration (TcD) Farms and Taluka Seed Farms. The TcD Farms develop and demonstrate irrigated farming technology; the Seed Farms produce stock seed for multiply- ing into certified seed, and planting material for producing hybrid seed. The Seed Farms also demonstrate irrigated farming practices. Recently attempts have been made to initiate adaptive research on the demonstration and seed farms but, to date, this program has not been fully developed. 2.20 Agricultural Inputs. (a) Fertilizers are marketed by the private as well as the public sector. The business is well organized and has been functioning effectively for several years. Adequate competition between private traders, and between the public (Fertilizer Corporation of India) and private sector ensures prompt service to farmers and prevents unauthorized prices being charged. Legislation ensures fertilizer quality and truth in labelling. (b) Pesticides are manufactured and formulated locally and are sold principally by the private sector. The range and quantity is adequate; quality and shelflife notification are controlled by legislation. A product technical service is available from most of the larger distributors, the manufacturers and formulators representatives, and the extension service. (c) Seeds are produced and marketed by the Maharashtra Seed Corporation and by private growers and merchants. Much of the sorghum and an increasing amount of the pearl millet are hybrids; practically all the long-stapled cotton is the well known and well liked H-4 hybrid. Seeds of the non-hybrid crops (wheat, pulses) are produced and tested according to legislation modelled on the International Seed Testing Association standards and has been supported by the Bank Grouip (Ln. 1273-IN). (d) Credit. M4aharashtra has one of the better developed credit systems in India. Farmers in general have adequate access to institutional credit. Credit is provided through Land Development Banks, commercial banks and cooperative banks. Refinancing of long-term credit was provided by ARDC, (assisted by IDA) and will continue to be provided by NABARD, which has replaced ARDC. Loan recovery performance of ARDC-refinanced loans, though inadequat:e in the recent past, has improved substantially during the last year and GOM is exerting a strong effort fur- ther to enhance recoveries. Loan recovery rates of short-term production credit (60-70%) are also showing an improving trend in the project areas. 2.21 Marketing, Storage Processing and Prices. The project area is ade- quately served by marketing, storage, distribution and prinary processing facilities. Prices are competitive. Government-supported procurement prices help even out disruptive price fluctuations and are chiefly effective after harvest when prices tend to be depressed.  -14- III. THE PROJECT Project Scope and Objectives 3.01 The project would upgrade, over a five-year period, the irrigation distribution network of selected areas on an aggregate total of 94,450 ha, in five existing irrigation schemes: Jayakwadi 42,350 ha Purna 10,500 Mula 21,970 Girna 11,030 Khadakwasla 8,600 Total 94,450 ha 3.02 The main objective would be to increase the effective utilization of available irrigation water supplies, thereby to increase agricultural produc- tion and farm incomes, and promote rural development. This would be achieved through a number of measures of which the most important would be the upgrad- ing of the irrigation distribution network, with emphasis on the minors and field channels, to ensure a reliable water supply at the farm level. To remove other existing constraints, the following complementary activities would be undertaken: (i) improving surface drainage and providing access along canals, (ii) improving system operations, (iii) promotion of land shaping, (iv) identification of suitabLe on-farm irrigation practices and viable cropping systems through adaptive research, and; (v) the training of farmers, canal inspectors, and land development assistants.l/ 3.03 The main components of the project would be: (a) Upgrading of the existing irrigation and drainage systems (with emphasis on minors and field channels) and construction of canal surface roads; (b) construction of buildings for engineering staff and training centers; (c) procurement of equipment for construction, operation and maintenance, survey, landshaping, training and research; (d) improving the operation of the irrigation distribution systems; 1/ A generic term adopted for CADA's technical assistants, agricultural assistants and civil engineering assistants, all of whom are field super- visors of land development works.  -15- (e) an adaptive research program; (f) training of farmers, canal inspectors, and land development assistants (LDAs), and study tours for senior staff; (g) research in water management and small structures; and (h) monitoring and evaluation, including a farmers attitude survey. Infrastructure and Equipment 3.04 The project would finance the following: (a) Improvements to Distributaries. Improvements would be made to ensure a reliable water supply to the head of the minor. Distributaries would be improved in the project areas of Jayakwadi, Purna, Mula, (distributaries Nos. 3, 4 and 5 only) and Khadakwasla. 1/ In conformity with a recent GOM decision, carrying capacities would be increased in Khadakwasla (as in Girna under MIP II) to allow for a seven days on/off operation in kharif and rabi. In case of Jayakwadi and Purna the canials original capacities would be restored. Upgrading the distribu- taries would mainly involve the construction of additional cross regulators, repair of structures and gates, drainage channel crossings, the replacement of structures where they are beyond repair, and reshaping of canal sections or repsir to embankments where necessary. (b) Upgrading of Minors. Minors would be improved in Jayakwadi, Purna, Mula (under Distributaries Nos. 3, 4 and 5 only) and Khadakwasla.2/ Work would include (i) clearing, silt removal and resectioning; (ii) construction of additional structures where required, in particular cross regulators and tail escapes; existing falls would be converted into cross regulators where-- ever possible; (iii) the provision of a water measuring device (standing wave flume) at t:he head of each minor; (iv) necessar.y repairs to existing structures; (v) extension of minors to reduce chak size to a 25 ha maximum, including construction I/ Distributaries Nos. I and 2 in Mula and distributaries in Girna are being improved under MIP II. 2/ Minors under distributaries No. 1 and 2 in Mula and minors in Girna are being improved under MIP II.  -16- of additional chak outlets, and; (vi) lining at critical locations such as in high fills and in sharp curves. (c) Upgrading of Field Irrigation Channels. These channels take off from minors through gated (one cusec capacity) outlets and convey irrigation water within the chak to individual farms. Work on field channels would include (i) clearance and resectioning of the channels to one cusec capacity and their extension where necessary to reach all farms, (ii) provision of additional structures where required including drops, division boxes, tail escapes, a water measuring device (Parshall flume) just down-stream of the chak outlet and crossings of farm tracks, (iii) selective lining (not more than 15% of the total length): 5 m upstream and downstream of structures, in stretches where channels run in high fill, along curves etc. (d) Drainage Improvements. Field drainage channels would be constructed within every chak to assure drainage for every farm. The field drains would be cornected to link drains to convey the drainage water to existing natural drainage channels. Improvement to the latter channels would be limited to major bottlenecks, mostly removal of excess weeds and channel widening at critical spots. (e) Canal Service Roads. The existing canal service roads would be improved concurrently with the construction or reshaping of the canal embankments along the distributaries and minors, or, where not available, they would be provided according to the present GOM criterion that every canal with a capacity of more than 5 cusecs will be provided with a canal service road on its embankment. These roads would have a width of 3.0 m and, where in BC soils, pro-vided with a 20 cm murrum topping applied in two stages. (f) Buildings. Buildings to be constructed under the project would include six training centers (two in Jayakwadi and one in the other schemes) for farmers, Cls and LDAs, and the necessary additional offices and quarters for construction and operation and maintenance staff. (g) Equipment. Additional equipment would be provided for construc- tion, operation and maintenance. This would include vehicles, trucks, surveying equipment, construction equipment, extrusion machines (for the pre-fabrica:ion of concrete field channel sections), mini-computers, communication equipment, and equipment for monitoring, training and research.  -17- Survey, Design and Construction Standards 3.05 Appropriate survey and design standards for the upgrading of the minors and field channels have been developed during the design and construc- tion of the Farmers Project. The most relevant design criteria are presented in Annex 2. A detailed design manual has been prepared by COM and would be made available to all concerned CADA staff. Ar. important step in designing chak improvements is the "problem survey" to identify existing irrigation problems. This survey, together with the topographical survey, helps to decide where improvements are needed, particularly the extent of channel improvement, repair of strumctures, need for new strutures, extension of field channels to irrigate until now uncommanded areas and, most importantly, to decide on the need for selective lining, since this is the most costly item. 3.06 Design standards used prior to the Farmers Project have been rather poor, as evidenced by the many structural failures in the field. An album with improved typical designs for various structures to be used in the project has been prepared. For this purpose the best designs available with the CADA's have been selected - for minors and field channel structures mostly the designs used in the Farmers ]?roject; particular attention has been given to foundation details in BC soils.. In addition, an assurance has been obtained from GOM that it would plan, design, construct, operate and maintain the irrigation, drainage and road network in accordance with standards and criteria satisfactory to the Bank Group. 3.07 Cross regulators in distributaries would be designed and constructed to allow for the diversion of the design flow into the minor when the canal flows only half-full. The need for cross regulators on the minors would be determined on the basis of the rotation schedule for the flows to be diverted into the chaks located on each minor. Canal embankments would be properly compacted. After completion of construction, levels would be taken of the irrigated fields and farm turnout to check irrigability; any deficiencies would be corrected prior to commissioning. 3.08 In Jayakwadi, design work for 5,000 ha to be implemented in 1983/84 is on-going. Survey work for 2,500 ha has been completed. Design of build- ings is on-going in all project areas and their construction is to start as soon as possible. Land Shaping 3.09 One of the major constraints to maximizing crop yields under irriga- tion in the project area is the uneven water distribution in the fields. To some extent, this can be mitigated by the proper orientation of the fields relative to the inlet and the contours (para 3.11) but, for maximum efficiency, it must be combined with land shaping. This is well recognized by the State, and land shaping has been a feature of irrigation development for many years. The work was typically executed with heavy machinery,  -18-- bulldozers and scrapers, operated by the District Soil Conservation Service (DSCS) or by manual labor provided under the Guaranteed Employment Scheme (GES). The Maharashtra Land Development: Corporation (MLDC) has been provid- ing technical guidance to DSCS and arrarnged interim finance according to NABARD guidelines. Small and marginal farmers were given a 25%-33% subsidy. More recently, a DSCS Cell has been set up within the CADAs. The landowners usually received a loan for the work, the size of which was determined by the number of cubic meters of soil that had to be moved. The funds were passed to DSCS and the landowner had to repay the loan either directly to the Bank, or as arrears of land revenue if the loan came from the special fund set up to assist farmers not eligible to borrow from commercial banks. The fact that farmers could only use DSCS or CADA has limited the extent of land shaping to what those agencies could achieve; the fact that no assistance by surveyors in marking out the fields for land shaping was available prevented the landowners from doing landshaping themselves or to call upon other individuals or agencies to assist them. 3.10 Under the project, the loan for land shaping would continue to be based on the number of cubic meters of earth to be moved. However, the landowner would be free either to execute the earthmoving with his own resources, or to invite any private or public agency to assist him. Land- owners who would want to arrange their own land shaping would be assisted by a free technical advisory service, the costs of which have been included in the project cost estimate. Small contractors undertaking the work for the landowner would be paid at agreed intervals for completed sections of work, which would be checked by CADA whether it meets specified standards. After the initial land grading operation the farmer may have to undertake light land shaping at regular intervals to maintain a uniform grade. For further details see paras 5.12 to 5.16. Adaptive Agricultural Research and Extension 3.11 Adaptive research would principally focus on developing and demon- strating: (a) irrigation practices suitable for farmers fields as they are, i.e. before land shaping; (b) cropping sequences and farming systems suitable to the physical environment and the various farming skills and risk-taking ability of the farmers, and; (c) farming with purchased input levels that fall short of the optimum usually recommended by research stations. 3.12 Adaptive research would be integrated into the ongoing agricultural extension project (para 2.18) and develop recommendations that the extension organization would disseminate. The program would be developed by Rahuri and Parbhani Universities and would be designed to serve the commands of the project areas. It would be reviewed by the Agricultural Extension Direc- torate and their regional officers responsible for the command areas, and implemented by officers seconded to CADA from the agricultural extension service and the participating Universities, in accordance with the concept of CADA's charter (para 5.04). To strengthen implementation, the extension  -19- services' Subject Matter Specialists (SMSs) would receive additional training in irrigated agriculture in WALMI (para 5.11). The Universities' Directors of Research would be in overall charge oE execution which would be the responsibility of the Regional Research Stations or sub-stations. They would thus be in a position to become familiar with the problems faced by the farmers and integrate them into the program for the following year. The venue would be six selected groups of outlet comands (two in Jayawakdi and one in each of the other scheme areas) where farmers owning at least two thirds of the land agree to participate. While farmers in the selected outlet commands would, along with all other farmers, be actively encouraged to shape their land to meet CADA's standards (paras 3.09-3.10); once over two thirds of the area has been shaped, the adaptive research venue would move to another outlet command, to serve better those farmers whose land is not yet shaped (para 3.11). The coordinating body would be the Directorate of Irrigation Research and Development. For details see Annex 4. An assurance has been obtained from GOM that, commencing March 1, 1984, it would submit for the Bank Group's review and comments., an annual program for the adaptive agricultural research activities to be carried out during the following farming seasons, and, thereafter, taking into account the Bank Group's com- ments, carry out such program. Improved System Operations 3.13 Under the "Shajpali" system of operation traditic,nally practised in Maharashtra, farmers have to submit applications for the supply of irrigation water for one or more seasons, or several years (i.e. sugarcane), depending on the type of crop. Supplies to the individual farmers may then be sanc- tioned after considering water availability, crops planned tc, be grown, drainage conditions in the area etc. Flows of one cusec are rotated among the farmers of a chak but the time of supply to each farm varies according to the perceived need of the farmer. At present, water applications are still being received after the irrigation season has started, so that irriga- tion schedules have to be revised (by hand) two or three times each seasons a difficult process, considering the large number of farm units. The combined effect has been unreliable and inefficient water supply to chaks and individual farms. 3.14 In the Mula scheme rotational water supply (RWS) within the chak and with a fixed duration of supply per ha has recently been introduced as a pilot operation on 3,000 ha, together with rigid water scheduling among the chaks on the minor. This new system has been very well received by the farmers and would now also be introduced in the project areas. The Maharashtra Irrigation Act (1976) allows the CADA to make this change. The present and intended mode of operation in the schemes have been shown in Annex 1, T-12. The rehabilitation of the irrigation networks would make it possible to reduce irrigation intervals and meet crop water requirements better. Minors would generally be operated on a 7 days on/off basis except in the hot weather season when irrigation intervals would be less than 14  -20- days. Efforts would be made gradually to introduce, for the first time in India, mini-computers to prepare the irrigation schedules; this would also facilitate keeping flows more or less constant in minors and distributaries. 3.15 At present water allocations do noit depend on crop and actual soil moisture conditions. To match more closely allocations with requirements, reference fields would be set up in each lproject area on typical soils and crops, to monitor soil moisture conditions under irrigation. This informa- tion would be used, firstly, to evaluate and improve irrigation scheduling and, secondly, when water becomes scarce, to reduce the water supply to farms. The second objective could be ach:ieved by eliminat:ing or delaying certain irrigations in the kharif after rainfall or during droughts, by reducing the flow duration per ha and/or 'by applying water only at critical growth stages. 3.16 Operation and maintenance (O&M) manuals, which do not exist at present, would be prepared under the project. They would provide detailed rules and procedures, including aspects oi' timing and freqcuency of water applications, flow measurement (instantaneous and in volume), water account- ing, standard forms for reporting, operat:ional policies fcor droughts and periods with more than expected rainfall and emergency situations, response to variations in local demand, information on closing periods, communications with farmers and farmers organizations andl within the pro-ject organization, detailed job descriptions for O&M personnel and sanctions. 3.17 In conformity with the above, assurances have been obtained from GOM that, to the extent the irrigation system has been completed, it would prepare and apply for completed works (i) improved plans f'or water distribu- tion and allocation for each distributary canal, minor and. chak; (ii) RWS within each chak, based on pre-determined water flow durations for each farm; (iii) data from reference fields for typical soils and crops to improve irrigation scheduling. In addition, an assurance has been obtained from GON that it would furnish to the World Bank Group for its review and commients, not later than June 1, 1984, a revised draft of its operation and maintenance procedures for canal irrigation distribution systems in the project area, and, by December 1, 1987, develop and introduce an operation and maintenance manual, taking into account the Bank Group's comments and the experience gained through the adoption of the revised operation and maintenance proce- dures. Training 3.18 To ensure successful implementation and operation of the project training programs would be arranged for farmers, CIs, and LDAs. (a) Training of Farmers. In addition to the unreliabiLity of supply, the uptake of irrigation water has been slow because many farmers do not have the tradition, and therefore the experience, in its  -21- use. The difficult topography of many holdings contrilbutes to this. Land shaping, which will eventually modify the t:opography, is an expensive and necessarily slow process (para 3.09). Therefore, it is essential to train farmers to make maximum use of their water under the topographic and soil conditions of their farms. Such training cannot take place on an operating farm which is under crops: no farmer can be expected to use his land and water for learning instead of income generation. I'herefore suitable Training Centers would be established under the project where farmers could themselves practise different fieldL layouts, observe the results and learn how to adlapt them to their own lands. The training would be extended to the total scheme areas. There would be one Training Center in each scheime area attached to the TcD farm. In Jayakwadi, at present, there is only one TcD farm. For this large diverse scheme two Training Centers would be established; the secornd one would be on one of the Taluka Seed Farms. Each Training Center would have suitable staff housing, and classroom and hostel facilities for about 35-40 participants. The staff training the farmers would consist of an irrigation agronomist and an agriculturist; courses would last for three days, to enable the staff to visit their former pupils on their farm, to follow up on their progress. The Centers would first train the contact farmers of the farmer groups organized under the T&V system, and then others as time and opportunity permits. Since training all farmers will take time, the objective would be to have as wide a spread o:J trained farmers in the command areas as possible and practicable. The facilities of the Centers would also be used to impart Initial training to the AAs, for their pre-season and fortnightly training sessions under the T&V project, and also to train LDAs. Under the Civil Service Commission rules of Maharashtra, all recruits have to undergo a mandatory four-month period of induction training. Since suitable facilities for this are inadequate in the State, the Training Centers would havet to be used also for this purpose. Participants would be the newly recruited CIs and LDAs. For details, and expected utilization of the Training Centers, see Annex 5. (b) Training of Canal Inspectors. The introduction of improved system operatlions would require the training of the CIs in the new disciplines (the Cls form the lower field staff in canal opera- tioa and are responsible for areas of approximately 500 ha). All of about 1100 CIs in the scheme areas would undergo training, but priority would be given to the about 200 working in the project areas. The training would 'be for eight weeks in the first year; additional two-- week courses would be held in subsequent years. The training wouild concentrate on system operations, irrigation scheduling, water management, water accounting, maintenance and communfcations with farmers., The classes would be held in the same Training Centers as used for farmer training (para 3.18 (a)). A brief outline of the training program is given in Annex 5. The trainers would be WALMI--trained JEs.  -22- (c) Training of Land Development Assistants. One WALMI trained JE would normally be assisted by two LDAs in the design and rehabilitation of minors and field channels. The traiLning would focus on survey methods, planning and design of project works, preparation of cost estimates, construction methods and quality control. About 300 LDAs would be trained for a period of one month; the instructors would the JEs. 3.19 Study Tour. A three weeks study tour would be organized for six senior project engineers and agriculturists to visit the Sudan and Egypt to observe engineering and agricultural practices developed in these two countries on soil types similar to those in Maharashtra. 3.20 GOM has already furnished the Bank Group with a detailed training program and syllabus, which are very similar the training program presented in Annex 5. An assurance has been obtained from GOM that, taking into account the Bank Group's comments, it would carry out the agreed training program. Water Supply and Demand 3.21 Irrigation water is underutilized at present. As a result of the project, irrigation intensities are expected to more than double (Annex 1, T-10), with the main increase in the rabi and hot weather seasons. The projected irrigation intensities with the project during these seasons have been estimated on the basis of the expected average reservoir storage capacity at the beginning of the dry season (Annex 1, T-9) and projected cropping patterns (T-4 to T-8). Water availability during the kharif would not be a constraint; projected irrigation intensities during this season are not expected to increase much. Implementation Schedule 3.22 The project would be implemented in five years from November 1983 to November 30, 1988 (Annex 1, C-3). Initially, high priority would be given to the design and construction of alditional offices, quarters and training centers, the procurement of equipment, the positioning of staff and the preparation of detailed plans for subsequent years. Small village contrac- tors would carry out the work. One contractor would generally have a con- tract for construction work in twgo chaks, with exception of the drains which would be constructed by another contractor. Careful construction planning would have to be undertaken by the engineer in charge to synchronize the construction schedule with the irrigation schedule. 3.23 Implementation targets folr the project areas would be kept flexible. To meet the overall target of 95,000 ha, the itargets for one or more areas may be increased in case implementation in another area is slow.  -23- IV. COST ESTIMATES AND FINANCIAL ARRANCEMENTS 4.01 Total project cost would be about Rs 742 M (US$78.1 M). Taxes and duties included in this estimate are only applicable to a few items or: equipment and are, in aggregate, negligible. The foreign exchange component is estimated at Rs 100.4 M (US$10.6 M) which is about 13 % of the total cost. Estimates are based on expected May 1983 prices. Physical contingencies which were estimated separately for each item range from 10% to 20% and average 12.5% of the base cost. Price contingencies, which amount to about 25% of the base cost are based on expected inflation rates of 8.0 % in 1983/84, 7.5% in 1984/85, 7.0% in 1985/86 and 6% thereafter. The cost estimates are detailed in Annex 1, T-13-T-23 and sum- marized in the following table: % of Foreign Total Exchange Base Local Foreign Total 1/ Local Foreign Total 1/ % Cost ----Rs Million ------ -----US Million------ Land Acquisition 1.4 - 1.4 0.14 - 0.14 - 0.3 Distributaries 30.8 2.7 33.5 3.24 0.28 3.52 8.0 6.2 Minors 61.3 3.2 64.5 6.45 0.34 6.79 5.0 11.9 Field Channels 131.0 6.9 137.9 13.79 0.73 14.51 5.0 25.4 Link and Main Drains 23.1 1.2 24.3 2.43 0.13 2.56 5.0 4.5 Offices and Quarters 46.7 11.7 58.3 4.91 1.23 6.14 20.0 10.7 Vehicles and Equipment2/ 13.8 36.1 49.9 1.45 3.79 5.25 72.3 9.2 Training 3/ 19.3 6.0 25.3 2.02 0.63 2.66 22.8 4.7 Adaptive Research 3/ 12.1 3.0 15.0 1.27 0.31 1.58 19.7 2.8 Engineering Research, Monitoring and Evaluation 3/ 11.0 4.7 15.7 1.16 0.49 1.65 29.7 2.9 Engineering, Supervision and Administration 116.8 0.5 117.3 12.29 0.05 12.35 0.4 21.6 Total Base Costs 467.0 75.9 542.9 49.16 7.99 57.15 14.0 100.0 Physical Contingencies 57.3 10.2 67.6 6.04 1.08 7.11 15.1 12.4 Price Contingencies 116.8 13.7 130.5 12.29 1.45 13.74 10.5 24.0 Total Project Costs 641.2 99.8 741.0 67.49 10.51 78.00 13.5 136.5 Front-end Fee on Bank Loan - 0.6 0.6 - 0.06 0.06 Total Financing Required 641.2 100.4 741.6 67.49 10.57 78.06 1/ Discrepancies due to rounding. 2/ For construction and O&M. 3/ Includes required equipment.  -24- Financing 4.02 The proposed IDA credit of US$32.0 M and Bank Loan of US$22.7 M would finance about 70% of the total cost including the foreign exchange component (US$10.6 M), about 65% of local costs and a capitalized front-end fee of US$0.6 M. The Bank Group's financing of a high percentage of the total cost is justified, given GOM's constrained budgetary situation, and because the project specifically aims to improve the distribution system closest to the farmers- fields, most of whom are small subsistence farmers who cannot afford to execute improvements out of their own resources. Its other aims are better irrigation water utilization, improved systems operations, training programs for farmers and CIs, advice to farmers on land shaping and adaptive research. All expenditures would be met by GOM from its development budget, which includes a GOI contribution. The credit would be made to GOI on stand- ard IDA terms. The Bank Loan would be for 20 years, including five years of grace, at the prevailing interest rate. An assurance has been obtained from GOI that it would make the proceeds of the credit and loan available to GOM on GOI's standard terms and arrangements for development assistance to the States. In addition, an assurance has been obtained from GOM that it would promptly provide the funds to implement the project in accordance with the five year project implementation program. To ensure an early start of the project, the Bank Group would agree to GOM's request to finance retroactively after project appraisal (January 1, 1983) items such as buildings and equip- ment, and costs related to the attitude survey, adaptive and engineering research, and training programs. The amount of retroactive financing would not exceed US$1.0 M and procurement would be in accordance with procedures satisfactory to the Bank Group. Procurement 4.03 Civil works financed under the project would cost approximately US$35.0 M, excluding physical contingencies, price increases and engineering and administration costs. The works would be carried out in five different project areas and constructed over a five year period i.e. an average volume of work per year per project area of only US$1.4 M. Most of it would be, small rehabilitation on minor canals and field channels adjacent to farmers fields, involving earthwork and repairs to, or construction of, small struc- tures. The work would be highly labor intensive and spread out over large areas. During the kharif season practically no work would be done: construc- tion would be mainly during the rabi and hot weather season, but the work would be scheduled intermittently to avoid disruption of on-going irrigation. This requires great flexibility on the part of contractors. International and larger local contractors do not have this flexibility; moreover, because of the seasonal nature of the work, their overhead costs would be very high. Consequently the works are not suitable for international competitive bidding (ICB). The work would therefore be carried out by local village contractors on the basis of small piecework type contracts. Such contracts are awarded under local procurement procedures which are satisfactory to the World Bank Group. Some departmental work may be carried out for types of work in which  -25- local contractors would experience difficulties, or for quality considera- tions (such as compaction); such works would be limited to 25% of all works. 4.04 Equipment and Vehicles financed under the project would cost about US$5.25 M, excluding physical and price contingencies. They would be procured according to LCB procedures. Suitable items would be grouped together to promote efficiency in tendering and attract competition; however, awards will also be accepted on individual schedules to attract small manufacturers. Adequate competition can be solicited among Indian firms for this equipment. Because of existing servicing and spare part supply, there are considerable benefits to be derived from procuring local models. The CWC has developed standard bid documents and procedures for equipment, materials and supplies which have been approved by the Bank Group and would be used in the project. Contracts of equipment estimated to cost US$ 50,000 equivalent or less may be procured by prudent shopping through normal trade channels (i.e. off-the-shelf) subject to a ceiling amount of US$250,000. Contracts for bidding packages for goods costing US$300,000 equivalent or more would be subject to prior review by the Bank Group. Remaining contracts would be subject to post-review by the Bank Group. Disbursements 4.05 Disbursements under the credit would be made against: (a) Civil works--85% (b) Vehicles and equipment: (i) directly imported--l00% of foreign expenditures; (ii) locally manufactured--100% of ex-factory cost; (iii) other locally procured--70%; (c) Incremental staff costs for training, adaptive and engineering research, monitoring and evaluation--70%; (d) Special surveys and study tours--100%. Disbursement requests for civil works would be made against certificates of expenditure submitted by GOM separately for each project and itemized by project component. Disbursements for work within a chak would only be made upon full completion of the work. Disbursement requests for such work would be submitted together with a completion certificate duly signed by the AE in charge, stating that all works in the chak have been completed in accordance with the agreed planning and design criteria. Disbursements for departmental works,for Rs 150,000 or less for equipment, vehicles and incremental staff costs for training, adaptive and engineering research, monitoring and evalua- tion and the costs for the special surveys and study tour would be made against certificates of expenditures itemized by type of work. Documentation for these works would be retained by GOM and made available for inspection by the Bank Group during review missions. Full documentation would be required for all other disbursements. The disbursement schedule and proposed alloca- tion of the credit by category are shown in Annex 1, T-24 and T-25. Expected disbursement rates are somewhat higher than experienced disbursement rates in the irrigation sector. This appears realistic as five separate CADA  -26- organizations will carry out a relatively small program. It is expected that disbursements would be completed by August 31, 1989. Accounts and Audits 4.06 The CADAs would be subject to normal Government control and auditing procedures which are satisfactory to the Bank Group. Agreements have been obtained from GOM that it would (i) maintain separate records and accounts to reflect, in accordance with sound accounting principles and procedures, its resources, expenditures and operations related to the project; (ii) furnish to the Bank Group copies of accounts and financial statements for each fiscal year, certified as to their accuracy and authenticity by an independent auditor acceptable to the Bank Group, not later than nine months after the end of each fiscal year; (iii) have accounts and financial statements for each fiscal year audited by independent auditors acceptable to the Bank Group; (iv) furnish to the Bank Group immediately following its finalization, the report of such audit in such detail as the Bank Group shall reasonably request; (v) furnish to the Bank Group any other information as it shall reasonably request; and (vi) establish within CADA separate accounts and maintain separate records to reflect expenditures in each of the sub-project areas (para 4.06). V. ORGANIZATION AND MANAGEMENT General 5.01 Irrigation Development in Maharashtra is the responsibility of the Department of Irrigation. This Department is sub-divided into two Wings: the Irrigation Wing headed by a Secretary and the Command Area Development (CAD) Wing, headed by a Commissioner and Secretary (Annex 1, C-1). The Irrigation Wing is responsible for all new construction; the CAD organization is respon- sible for all construction below the chak outlets, all modernization work and O&M. The implementation of the project would be the responsibility of the CAD Wing through its CAD Authorities (CADAs). 5.02 Overall responsibility for the project would rest with the Commis- sioner and Secretary, CAD. Ianagement responsibility for coordination and monitoring of project activities would be shared between the Water Management Research Division in Pune and the CAD Administrator for Jayakwadi. The Water Management and Research Division would be responsible for coordinating activities contributing to improvements in system operation, agricultural research, training, special surveys, etc., including monitoring and evalua- tion (paras 5.19 - 5.21). The CAD Administrator for Jayakwadi would be responsible for coordinating the monitoring of all physical worlcs, procure- ment and accounting under the project.  -27- Command Area Development (CAD) Organization 5.03 Construction of the project works and subsequent management and operation would be the responsibility of five CADAs. The first CADAs were created in the early 1970s, to coordinate the work of the various State agencies and departments involved (the ID, the Agriculture Department (AD), the Public Works Department (PWD) and the MLDC) in the development of major irrigation schemes. CADAs have been established for the Jayakwadi, Purna, Mula and Girna Schemes and have generally performed well. A CADA for the Khadakwasla Scheme is still to be set up. However, as the CAD activities in the Khadakwasla Scheme would be limited for the time being to the project area, it would not be justified to set up a separate CADA. It has been agreed that the Khadakwasla Project area would come under control of the CADA for the Bhima project, which has its offices in Pune. 5.04 The CADA's principal executive is the Administrator, who is respon- sible to an Executive Committee (EC) comprised of Regional Heads of Depart- ments, Members of the Legislative Assembly and cultivators. The EC, through its composition, permits the participation of elected officials in planning and policy making. The CADA falls within the purview of a Regional CAD Board which is chaired by a State Minister and composed of elected and appointed officials. The Regional Board acts as a filter between the Regional CADA and the State Cabinet Subcommittee, which directs CAD policy. The Cabinet Sub- committee is chaired by the Chief Minister of the State and includes the Ministers of Agriculture, Irrigation, Power and Finance. The chain of com- mand reflects both GOM's desire to involve the peoples' representatives in planning and decision-making at Regional and scheme levels and the substan- tial powers that it has provided to the Authority's Administrator who, unlike even the heads of line Departments, has, through the Subcommittee, a very close link with the State's Chief Executive. The Secretary of the Subcommit- tee is the CAD Commissioner and he is responsible for preparing annual development and financial plans for each CAD scheme. Such plans are prepared in conjunction with the Secretaries for Finance, Agriculture, Irrigation, Public Works and other Ministries involved in CAD schemes. 5.05 The CADA Administrator directs the work of a Deputy Administrator (Engineering), Deputy Director of Agriculture, Assistant Administrator of the Revenue Department, Accountant Officers of the Finance Department, Deputy Registrar of the Cooperative Department and a Statistician of the Economics Statistics Department (Annex 1, C-2). A Technical Cell provides technical support for the scheme areas. Monitoring Cells would monitor the project activities in each sub-project (para 5.21). Design and Construction 5.06 All survey, design, planning, procurement and construction activities would be carried out by engineers assigned to the respective CADA head- quarters, Divisions, Sub-Divisions and Sections under the overall supervision of the Deputy Administrator (engineering). Specific Divisions will be set up, solely for the purpose of working on the MWUP, with their own offices and  -28- quarters. Experience with the Farmers Project has indicated that one JE can handle 200 ha per year of rehabilitation work on minors and field channels, including all survey, design and construction work. During the implementa- tion period, the Sub-Divisions would still have to operate the system and establish farmers organizations. Also more time would be spent on quality control by the AEs and EEs (para 5.07). To keep the AE-s and EE's workload reasonable GOM has agreed to limit the number of JEs dealing with the con- struction of minors and field channels to four per Sub-Division and the number of AEs to three per Division. Quality Control and Commissloning 5.07 An assurance has been obtained from GOM that it would take all action, as shall be necessary, to ensure adequate quality control by the CADA's of surveys, planning, design, construction and O&M activities. Specific duties of EEs and AEs have been agreed upon (Annex 1, T-26). Inspection books and chak registers would be maintained to report and monitor observations. Also the Technical Cells would carry out occasional spot checks. 5.08 To ensure that the works will be properly completed, assurances have been obtained from GOM that it would (i) cause the CADAs to test and certify in writing that the field irrigation and drainage channels within a chak have been upgraded in accordance with the agreed planning and design criteria, before entrusting the concerned Outlet Committee (OC) with the responsibility for O&M; (ii) within a period of two years from the commissioning of any distributary canal, minor canal or chak, and based on the experience obtained during operation of the system, cause the CADAs to carry out promptly any required improvements and modifications in the upgraded irrigation distribu- tion system; and (iii) make promptly the necessary funds available for that purpose. Operation and Maintenance 5.09 Responsibility for the day-to-day operation of the canal system up to the chak outlets also rests with CADA. Traditionally, one Section handles about 4,000 ha, but because of the increased workload resulting from the introduction of RWS each Section would only handle 2,500 ha upon completion of the rehabilitation work. Until recently a typical O&M budget: in Maharashtra provided an allocation of Rs 20 per ha per year. Recently this has been increased to Rs 80 per ha, which is found to be satisfactory. Assurances have been obtained from GOM that it would (i) operate and maintain adequately the distributaries, minors, drainage channels, link drains, canal service roads and buildings under the project and provide sufficient funds to carry out such operaticn and maintenance; and (ii) for purposes of adequately operating the irrigation systems under the project, cause each CADA, not later than thirty days after the ending of the rainy season of each year, commencing in 1984, to carry out a survey of the required repairs in each irrigation system and cause the CADAs to carry out the repairs promptly.  -29- 5.10 O&M within the chaks will be the responsibility of OCs (para 5.17). Strong efforts would have to be made by GOM to ensure that the OCs will adequately maintain the field channels. An assurance has been obtained from GOM that it would promptly repair and maintain the field irrigation and drainage channels, at farmers costs in case such works are not carried out by the OCs, and provide the CADAs with the necessary facilities for that purpose. Engineering Staff and Training 5.11 To ensure the implementation of the works to the agreed standards it would be essential that the engineering staff working on the upgrading of minors and field channels be WALMI-trained. The WALMI was primarily set up to provide the necessary staff for the MIP II and the Jayakwadi Scheme. Allocation of staff for these projects would have priority over the needs of the MWUP. It has been ascertained that WALMI can meet the overall demand for JEs for MIP II, the Jayakwadi Scheme and MWUP, with the exception of a small shortfall in 1985. This can be overcome through some special short training courses. It was agreed that the 30 JEs who followed an eight-week experimen- tal course in 1982 - which was found to be too short - would be retained and that 30 additional JEs would be trained in 1983 in a ten-week course. Also, 30 AEs and 30 AOs would be trained at WALMI in early 1984. Of the latter, 15 would work as farmer trainers in the Training Centers and 15 would work as SMS (Irrigation Agronomy) in the extension service organization. GOM would train engineering staff and create positions for these staff as shown in Annex 1, T-27 and meet the engineering staff requirements during actual implementation, as shown in Annex 1, T-28. In view of the importance of meeting these staffing and training schedules, an assurance has been obtained from GOM that it would train concerned CADA staff in WALMI in accordance with project implementation, staffing and training schedules which have been agreed between the Bank Group and GOM. Land Shaping 5.12 One pre-requisite of the proposed land shaping activities is the availability of sufficient trained staff for survey, marking-out and quality control work. At present, such staff are only available with SCS and CADA. Therefore, field surveyors would have to be trained to prepare a contour map related to a common benchmark; typically, the chak outlet. From these data a civil engineer, trained by SCS, would be able to calculate the necessary cut and fill to achieve the desired grades and the amount of soil to be moved. Field surveyors would peg out the field and, later, determine whether land shaping has been carried out as planned. Payment to the landowner would be made upon the surveyor's certification of good workmaiiship and proper finish. 5.13 It is expected that one engineer, assisted by drawing office staff, would be able to prepare field plans for five field teams, and possibly many more with the help of a mini-computer. Initially, therefore, the land shap- ing team would consist of one field crew in each of the five project areas and one engineer. One team would be able to survey, mark out and check the  -30- completed work on a total of about 1,400 to 1,500 ha per annum. Build-up and ultimate numbers would be determined by the demand for their services; com- pared to the potential benefits, the cost of the survey teams is insig- nificant. It is expected that landshaping operations could cover approximately 15,000 ha during the project period. 5.14 Fields would be marked out also for landowners who do not propose to borrow for levelling. This marking-out would be part of a free technical advisory service for small and marginal farmers. 5.15 Land shaping operations for eligible landowners would be financed from regular institutional sources. However, one obstacle to granting credit for land shaping is the large number of farmers who are not eligible to borrow from institutional sources because of previous defaults. These non-eligibles would be financed from a Special Fund, already set up to help such would-be borrowers. Total funding requirements would be approximately RS 40 M for the 15,000 ha. The administering agency would be the Maharashtra Land Development Corporation. 5.16 An assurance has been obtained from GOM that it would take all neces- sary action to promote land shaping in the project area. Farmers Organizations 5.17 Farmers organizations would be set up in the project areas at three levels (at the chak, minor and main or branch channel level) to improve maintenance, promote farmers involvement during the design stage, and improve water distribution and communications between farmers and CADA irrigation staff during project operation. GOM has provided the Bank Group with a detailed organization plan which is acceptable. COM and the Bank Group would also exchange views from time to time on how to improve the functioning of the organizations. Through these organizations the farmers would be able to convey compla!nts, requests and suggestions to the CADAs. Coordination between the three levels is assured as each comprises both farmers leaders and CADA officials. The CADA Boards (para 5.04) which also include farmers representatives would oversee the working of the committees. (a) Outlet Committees (OCs) would be organized for each chak to maintain field channels, distribute water according to RWS schedules, and prevent unauthorized irrigation. The irrigation schedules would be prepared by the O&M Section and displayed on signboards near the chak outlet well in advance of actual water delivery. Each OC would have five to seven members: two farmers on each field channel, one tail ender on each field channel, and the responsible CI and AA. A farmers leader would be elected from among the rnon- official members and the CI would be secretary. The OCs would be formed as soon as the chak boundaries have been determined and would be consulted on  -31- the most appropriate layout of field channels, location of farm outlets and crossings, and constraints in the present system. (b) Water Utilization Committees (WUCs) 1/ would be organized for each minor. WUC membership would comprise of five farmer leaders (out of which two would be small land holders and/or tail enders), the CI, and the JE. Initially, the WUC would only monitor the irrigation schedules prepared by the O&M Section, process complaints and seek appropriate solutions. However, GOM-s final aim is that the WUCs should become fully responsible for water distribution among the chaks on a minor since the many outlets on a minor are a heavy burden for CADA-s O&M organization. The irrigation schedules for the chaks would be displayed at the head of the minor (vide (a) above, for within the chak). (c) Canal Advisory Committees (CACs) would be set up for areas under the jurisdiction of the EE covering 40,000 ha or less. Five to ten members of the WUC would be elected on the CAC. The EE would be President of the CAC; the Agricultural Development Officer, the Assistant Engineer, Planning Officer of the Zilla Parishad and a representative of the local sugar factories would also be members. The CAC would develop the irrigation programs, monitor the perfor- mance of the main system, identify deficiencies and make suggestions for improvements. 5.18 An assurance has been obtained from GOM that it would take all neces- sary action to establish the farmers organizations in the project area in accordance with its prepared plan. Engineering Research, Monitoring and Evaluation 5.19 Water Management and Engineering Research. Responding to suggestions from Bank Group missions, in November, 1982 GOM sanctioned the establishment of two research divisions under the Directorate of Irrigation Research and Development in Pune: the Water Management Research Division (WMRD) and the On-Farm Development Structures Division (ODSD). Costs for necessary build- ings, equipment and incremental staff costs over the project period are included in the project cost estimate. The WMRD would evaluate and develop new modes of system operation, irrigation scheduling and irrigation prac- tices. WMRD would also evaluate the operation under local conditions of a 1,000 ha pilot scheme on two minors in Mula where irrigated chak outlets would be constructed of the adjustable proportional module (APM) and/or open flume outlet type, as used in north India. The ODSD would concentrate on developing cost effective designs for structures and lining, with emphasis on the development of precast structures, and guidelines for foundation design in BC soils; WMRD staff would include an economist to undertake required 1/ Locally known as Water Panchayat Committee.  -32- economic evaluations. As much of the actual field work required for the research would be undertaken by the respective CADAs, the two divisions will have access to their field staff. The scope of work is described in Annex 3. An assurance has been obtained from GOM that it would (i) not later than December 31, 1983, prepare and furnish to the Bank Group for its review and comments, a detailed work plan covering the activities to be undertaken by the Water Management Research Division and the On-Farm Development Structures Division during the period 1984 through 1989, inclusive, and, not later than April 1, 1984, taking into account the Bank Group's comments, implement the work plan. 5.20 Farmers Attitude Survey. The demand for irrigation water has only developed slowly in the command areas, and particularly so in Jayakwadi. This delays the realization of irrigation benefits, and underutilizes major infrastructural investments. Since the prime objective of the project is to remove the main constraint perceived - unreliable and inadequate water supply - it is essential to learn whether the farmers have additional reasons for not making more use of the water, and to endeavour to remove also these constraints. A farmers attitude survey would therefore be contracted to agricultural universities. It would be started in August 1983 and repeated at two-yearly intervals, at least until all project works are completed and commissioned. They would also indicate progress made by the respondents in water utilization between surveys. GOM and the Bank Group have mutually agreed on the questionnaire for the survey 1/. 5.21 Other Monitoring Activities. The CADAs would monitor a number of aspects critical to the success of the project: (i) training and positioning of staff; (ii) progress in survey, design and construction, and costs; (iii) extent of land shaping; (iv) seasonal cropping patterns, yields and produc- tion; (v) weekly water deliveries by distributary, minor and chak and com- parison with planned allocations to identify deficiencies in water distribu- tion or potential improvements in system operation; (vi) reference fields (para 3.15); (vii) groundwater levels and extraction; and (viii) collection of water charges. An assurance has been obtained from GOM that it would (a) prepare by December 31, 1983 for comment by the Bank Group and subsequently implement, a detailed plan for monitoring and (b) furnish the Bank Group, commencing June 30, 1985, annual reports with analyses and conclusions of the monitoring and evaluation activities. In addition, an assurance has been obtained from GOM that a sociological survey would be completed before Decem- ber 31, 1987 to evaluate the impact of the OCs, WUCs and CACs on the O&M of the upgraded systems. 5.22 Organization. The CAD Administrator for Jayakwadi would be respon- sible for coordinating the monitoring of all physical works, procurement and 1/ To include farmers without canal water at present, the survey would also extend to farmers in the Bhima and Kukadi Schemes (included in MIP II).  -33- accounting. Assurances have been obtained from GOM that it would (i) main- tain the Water Management Research Division under the Directorate of Irriga- tion Research and Development with adequate staffing and funds, to coordinate and develop improvements in irrigation systems operation and monitor and evaluate activities with respect to adaptive agricultural research and spe- cial surveys; and (ii) establish and maintain within each CADA a Monitoring Cell with adequate funds and staffing to carry out the monitoring activities under the project. 5.23 Reporting. GOM would submit to the Bank Group quarterly and annual progress Reports within three months after the end of each reporting period. Formats for reporting by each CADA would be standardized in consultation with the Bank Group. An agreement has been reached with GOM that it would submit to the Bank Group a project completion report not later than six months after the Credites closing date. VI. AGRICULTURAL PRODUCTION, FARM INCOMES, PROJECT IMPACT AND COST RECOVERY Agricultural Production and Yields 6.01 The principal impact of the project on agricultural production would be increased canal irrigation intensity (Annex 1, T-10); practically all of this would be at the expense of seasonal fallows which are now a major fea- ture of the farming pattern. Most benefits would be obtained from increased irrigation in the rabi and hot weather season through increased use of stored reservoir water. Lesser benefits are expected from increased irrigation in the kharif season, from surplus river flows, as the rabi is expected to remain the main cropping season (para 2.06). The more assured water supply under the project would not only induce farmers to plan for a larger area of irrigated crops but also help increase yields. However, proper land shaping, and its resultant better water distribution in the field would be the major factor in yield increases. Since extensive land shaping is unlikely to be carried out during the project implementation period (para 5.12), benefits from yield increases, certainly during the early stages of project life, would be marginal. 6.02 The increase in farming standards, the developing markets in the Middle East and the Gulf countries, along with improved investigations into the agronomy of many high-value crops, notably bananas, may well cause a shift in the cropping pattern to such high-value crops (including year-round vegetable production), and away from foodgrains. This development, too, would be affected by the project but since its extent is difficult to quan- tify, benefits would not be attributed to project works. 6.03 The general increases in farming standards would accelerate the development of dug wells (para 2.16). While the additional water reaching the fields would undoubtedly increase acquifer recharge, there is no evidence  -34- at present that wells, except for a few in isolated instances, run dry. Consequently, it cannot be assumed with any degree of assurance that, ini- tially at least, accelerated well development would be a function of the proposed project works. Consequently, increased production due to wells will not be attributed to the project. 6.04 Projected production in the five project areas is detailed in Annex 1, T-29. The most important production increments are expected to be: ('000 tons) Sugarcane 301.3 Banana 32.9 Foodgrains 44.1 Groundnuts 14.1 Farm Incomes 6.05 The project's effect on farm incomes has been estimated through an analysis of crop budgets (Annex 1, T-30) and typical cropping patterns. Net farm incomes in Jayakwadi are expected to increase from an average Rs 730/ha to Rs 4,960/ha at full development, summarized as fo'llows: Future Without Present Project Future With Project