India - Maharashtra Water Utilization Project

Documenat Of The World Bank FOR OMCU USE ONLY Rept No. 12354 PROJECT CO1%LEIION REPORT I NDIAK WATER UTILIZATION PROJECT (CREDIT 1383-IN/LOAN 2308-IN) SEPTRIDER 28, 1993 MICROGRAPHICS Report No: 12354 Type: PCR Agriculture Operations Division Country Derartment II South Asia Regional Office Thi document has a resicted distribution and may be wed by rnpients only in tk performnce of their offiial duties. Its contents may not otherwise be disclosed without World Ban]k autorization.  PROJEC COMPLETION REPORT MAHARASHTRA WATR UTILIZATION PROJECF (Credit 1383-IN and Loan 2308-IN) CURRENCY EQUIVALENT At Appraisal (May 1983) US$1.00 = Rupees (Rs. 9.50) (For exchange rates during implementatont see Attachment 1, Table 1) FISCAL YEAR OF BORROWER Government of IndialGovernment of Maharashtra - April I-Mach 31 ABBREVIATIONS CADA Command Area Development Authority DOA Department of Agricuture ERR Economic Rate of Retum GOI Government India GOM Govenmment of Maharashtra IBRD Iteratonal Bank for Reconstruction and Development IDA lnerational Development Association MW II Mahamashtra Irigation Project II (Credit 954-IN) O&M Operation and Maintenance PCR Project Completion Report SAR Staff Appaisal Report SDR Special Drwing Right WALMI Water and Land Management lsitute. Aurangabad GLOSSARY Chak Irrigation service area below the outlet from the minor Cusec Cubic foot per second Distributary Irrigation canal with capacity greater than 700 Vs Feld Chamel Irrigation Channel from the oudet from the minor to the farm inthechak Hot Season March to June Kharif West Season (June to October) Minor Irrigation canal with capacity less than 700 Y/ and serving chaks Rabi Winter season (November to March) Shejpali Traditional system of operation of irrigation schemes in Maharashtra whereby farmers submit applications for irrigation for areas of crops. Ifrigation supplies to &amers are sanctioned after considering water avail- ability and other factors.  FOR OMCUL USE ONLY THE WORLD SANK Washigon. D.C. 20438 U.SA Off. of DmreodwGenew Operaon Evaluatfn September 28, 1993 M RX0AMP-4 TO THE EXECUTiE DIRECGMRS AND THE PRDENT SUBJECT: Ptoject Completion Report on India aharashtra Wat,er Utilization Projet (Credit 1383-INLan 2308IN) Attached is the Project Completion Report on India - Maharashtra Water Utilization Project (Credit 1383-IN/Loan 2308-IN) prepared by the South Asia Regional Office. Part II was prepared by the Borrower. the project was implemented in accordance with the original design. Savings were achieved because eiicles and equipment became available from non-prcject sources; drainage criteria were aiodified, demand for land shaping was lws than anticipated, and the value of the Rupee depreciated. These savings permitted expansion of the area benefitted by the project by 20 percent, and canceDlation of the unused Bank loan. Anticipated benefits failed to materalize, however. In spite of lower costs and a larger rehabilitated area, the project's internal rate of return is eesmated at 3 percent, and likely to be as low as zero (Government reestimate is higher, at 9.9 percent). ThI raises doubts on whether the problems the project attempted to address were acually technical in nature, and whether the project- supported techna desin was the appropriate solution to the real problem Accodigly, the outcome of the project i8 rated as unsatisfcoy, sustainability as uncertai, and istitutional development as partial The PCR is genally acceptable. No audit is planned. Attachment iTis dome has a restcd dsbutIon and may b3 used by cIplets onry In the pufonao of their offic dute kt cont may not othe be diosed who Wold Bank Ahorzao.  I* OR MCUAL US ONLY PROJECT COMPtLEION REPORr INDU MAUARASHTRA WATER UTnLIZATION PROJECT (CREDIT 138341N AND LOAN 2308-IN) TABLE OF CONTENTS PREFACE . .... ......***#@***a. ............... i EVALUATION SUMIMARY .... .......... ....... ........ i PARTL PROJECT REVIEW FROM BANK'S.ERSPE IVB........... 1 3. Project bentivty .......................... ..... ... ........ 1 2.oBackground ...............................*. ........... 1 7.ProjecSustaiObi t n o n . ......... ..................... 2 4.Pro jecdvesan "tiron ................ 2 5. x2nhnnon......... .... 3 7. stustaiaiibty ............................. 6 8. Bank'sPerformance . .................................... 6 9.LessonsLeamed ................................... 7 10.Borrower's Performance ....................................... 7 ;IojectRe....n.ps .. 7 12.Consdting Serices . - .i 7 13. Project nentionandl)at ......................... ...... 8 PART U PROJECr REVIEW FROM BORROWR'S PERSPC .......... 9 PART M STATISTCAL TABLES 1.RelatedBankCredits ....... ................................. 67 2. Projectduinetable ......................... ....... . 68 3.Creditloanlsbu ennt . ................. .... ... ... .... ... . 68 4.PrQojectnplnlenon ..... .................. *..........69 5. Projec Cos iandinacing ................................... . 70 6.ProjectResults ...............*.............**e**......... 71 7. Status ofCovents. .......................................... 73 8. Use of Bank Resourcs ................ ....... ..... 74 A1TACllMErl: ADD1MIONAL DATA . .......................... . 75 Tables: 1.Actual PoectCosts ......... ......................... ...... . 75 2. Jayakwa - Irigated C ing Intiity ........................... 76 3.Purna- rdgatedCrppisnglntenidty ............. ........ ..... 77 This docwument has a utrl dlsu*buls oWa y be by yt Pfoanm. of thei al dutk& Its cntet my an othws be boe btd4sth Ms  4. Gima - Irigatd Cropping Itensity . ................... ..... 78 S.Mula- ITigatedCroppmi Inteity . ............................. 79 6. hadakwala - IrrigtedCropping Intensity ............................. 80 ATFACHMDENr 2: ECONOIC AND FINANCALL ANALYSIS ........ .... 81 Tables l(a)PiemofAgriculturProducts(costantl991piikes) ... .............. 84 lWDeriatonofEconomicPicsfor 1991 .......................... 85 1(c)Derivation ofEconomic Pcofor2000 . .......................... 86 2. hflation Factand Exchange Rates ............................ 87 3. EstimaFd Y8elds .................................. 88 4. Cropping Ptens ..................... .. 89 S. C.rop Budgets at Fancial Pris ............................. 90 6(a) Economic (1991) Crop Budgets for the Whole Project (With and Without tie Proect) . ... .............. 91 6(b) Ecnomic (2000) Cop Budges for the Whole Project (With and Without the Projeat) (1991 Rs) .. .......... .................. . ... 92 6(c) Economic(1991) Crop Budgets for Khadakwasla(With and Without the Project) 93 -d) 2conomic (2000) Crop Budgets for dawala(With and Without the Project) (1991 Rs) . .... . ... 94 7(a) Economic Analysisuthe WholPject (isBased on' Canals .Iigation lntitis) ....................... , .... 95 7(b) Economic Analysis/the Whole Ptoject (Based on Canals and Wels igaionItensit.es).................... 96 8. Economi Aysis/ayawai (Based on Canals and Welsb Irrigation Intesities) ........... . ....... 97 9. Economic AnalysiPuma (BasedonCanl snd WellsIrrgation 10. Ecnomic AnaysisnDKhakwasa (Basedon Canalsand WellsIrigation la aie) ....................... 99 1i(a) Cro t Iensities in (AnAiaOutside MWUP- With thel'rQject) .................. 100 11(b) Croppin ensities in hadawasa(An Aea nside MWUP- With thePoet ... ..........0..0...... . . 101 12. 3 H-Budget 3 FHi-nancial Prices (Without the Project) .......... ... 102 13. Fam Budget 3 Ha - Fancal Prices (With the Prqect) ............... 103 14. Farm Budget 3 Ha - Financial Pries (With the Project - Cropping Pattem Unchanged) .............................. ..... ..... 104 15. ImpactonFannBudget - SummaryBudget ....................... 105 MAPS IBRD 16997 IBRD 17058  i PRO 1 COMPLTION REPORT INOIA M AHARASHTRA WATER UTILIZAT1ON PROJECT (Credit 1383-IILoan 2308 IN) PREFACE Ibis is the Prject Completion Report (PCR) for the MaharaAtra Water Uiization Prot forwhih an IDA cradt of SDR29.6 million (Credit 1383-iN) and an IBRD Loan of US$22.7 million (Loan 2308-IN) were approved on June 9, 1983. At Government's request, the unutiliztd loan balance of US$22.6 million was cancelled on August 25,1989. The credit closed on August 31, 1991, two years behind schedule. The final disbursement from the credit was made on January 21, 1992. The undisbursed balance of SDRO.57 million was cancelled. Parts I (rject Review from the Bank's Perspective) and m (Statistical Information) were prpard by an FAOICP project completion mission which visited India in September 1991. Pat roject Review rom the Borroweres Perspective) was prepared by the Government of Maharashuo The prepaation of this PCR wa based inter alia on the Staff Apprs Report, the Legd documents, supervion reports, corresponence between the Bank and the Borrower, internal Bank memoranda, relevant Bank reports on the sector, and discussions with the Borrower's project staff and the Bank's project staff at Headquarters and in New Delhi.  m PROJBCT COMPLFION REPORT INDIA MAHARASHTPA WATER UT1ATION PROJECT (Credit i383-N/an= 2308-IN) EVALUATION SiMMARY 1. The main objective of the prject was to incas the ffciwve use of avaable iton watersuplies, in order to iase ic produc nand tam incomes and promoteru development. This was to be achieved by ugan the irgaton disibuon networks of seletd areas on 94,450 ha, in five esig irgatio schemes, t ensue a reliable water supply at the farm leveL The pwject was also to improve face drainage d provide roads along canals,improve systm operaion, promote land shaping, identi suitable on-fm irrigaton practices and viable cropping systems through adaptive research, and train farmers, caal mspetr, anld lanud development assistants. 2. The project was mplemented generally in accordance with th proposas in the Staff Apprsl Report (SAR). There wre savings in vehicles and ei ent, w ic w rgely obtaind from other project, and in the cost of adaptive ree -ompared with a l estimats There were also savgs in the costs of drains following revised d e critera g steeperslopes and few tuctums. Memse savings were pary ofetby increased wOrk on disruaries and mior and increased ovetead coss; overheads amouted to about 37% of other costs. The total project cost was about US$60,190,000 (JS$520 per ha upgraded). 3. Due to deprecatim in the value of the rupee in terms of the US dollar and SDR, expenditures in rupees corresponded to less in dollars and SDR otn estmated in the SAR. In order to use some of these savings, the scope of the project was cnaged to incase the amea to be upgrded from 94,450 ha to about 115,200 ha. Prject compleon and the crdit closing date were delayed by two years to enable the project works, including the additional wotk, to be com;leted and further use of the credi to be made. The loan was not used and was canceed in 1980 foHowing aors request 4. rTe project achieved its objective of upgading the irtiOn distibution nw and reducing the sines of chaks. estimed in the SAR ITh intesity of irrigationt from s increased from 30% to about 37% at prest (SAR estimated 86% at fldevelopment). Iigtion intnsit has oftn been gater outside e project V Itrigadon Intenity = Area of crop irfigafionlcultvable command area Crops grown over more than one season are only counted once.  iv area th within the project area (see Atachment 1). This is pardy due to growing more crops with heavy water demand in the project area and may also be affected by the way water Is alocaed and some disruption due to project works, but it casts doubts on the usefulness of the irigation intsty as a means of measurng poject results Te economic rate of return (ERR) was estmated on the busis of data provided by the Command Area Development Authotity (CADA) and found to be between about 3% and 13%, depending on assumptions made (see Atachment 2). S. Annual producdon of crops in the project are has been estimated to have increased by about 160,000 tons of sugarcane (SAR 301,300 tons), 16,000 tons of food grmis (44,100 tons) and about 4,600 tons of groundnuts (14,000 tons). These amounts are much lower than SAR estimates due to lower irrigation intensity and generally lower yields for food grains and proundnuts. Farm incomes are estimated to have increased by about 61% due to the project This IS much less thn the 228% incrase, esdmated in the SAR, due to lower incremental cropping intensity and reduction in avage farm size (3 ha instead of 4 ha - see Part I, para 17). 6. In general the responsibility for operation and maintenance (OM) froom headworks to the oudet into the field channels remains with the irgation Delpand the Command Aea Development Authority (CADA). The amount allocated for maintece is inadeqte to avoid deterioraion of the system. It is therefore likely that gradual progssirve deterioration of the sem wil continue (see Part I, pam 21). Maintance of field chanwls and drains is generAy left to farmers, which is reasonably successful. However, repairs to gates, concrete and masony stctu and cand lning are often left undone and gradual prosve deterioration of these is likely. Nevertheless, it is expected that famers will generally enswue dua the field chaes operative, but the quality of the irgation network is likely to decrease with time (see Part I, pam 22). Fndions and Lessons Leaxed 7. . Fmdings Improvements to system operation were disappoinrtin, partly because local Staff have incentives to leave subsantial scope for farmers to buy favours m an imperfect system (see Part I, paras 12 to 15). The policy for systm operation is not clear. The restriction on conjunctive use of canal water and groundwater should be removed (see Part IL para 15). Traning of farmers (ncluding those from outside the project area) and staff of CADA and the Department of Agriculture (DOA) at the training centres constructed in the subproject areas should continue. 8. Lessons &anad. The piot projects on which this project was based gave valuable :fln (swe Part L parm 7). It IS diffit to influence the Depam of Agriculture (DO-A) on Erigation project in which they have no component. In a project c ng almost entirely of local costs, devaluation of the local cunency is lbely to resut in underisbursement When available water is spread over too large an area, few benefits will be obained by improving teiy v Shpali isdiffultto ad i y,pariuly in areas whwater is scaice. Mo rg of projectbenefits should be supplemented by evaluaon of results.  1 PROJECT CONM=ON REPOR'T INDIA MAHARASHTRA WATER UTEILZATION PROJBCT (Credit 1383-IN/L0n 2308-IN) PART L PROJECT REVIEW FROM BANK'S PERSPE(