China - Northern Irrigation Project

 ICRR 10129 Report Number : ICRR10129 ICR Review Operations Evaluation Department 1. Project Data : OEDID : OEDID: C1885 Project ID : P003474 Project Name : Northern Irrigation Project Country : China Sector : Irrigation & Drainage L/C Number : C1885 Partners involved : None Prepared by : George T. K. Pitman, OEDST Reviewed by : Hernan Levy Group Manager : Roger Slade Date Posted : 08/13/1998 2. Project Objectives, Financing, Costs and Components : The credit was approved in FY 98 and closed in April 1998, two years later than scheduled at which time it was fully disbursed. Objectives To increase the efficiency and profitability of agricultural production in the Inner Mongolia Autonomous Region and alleviate absolute poverty in the Ningxia Hui Autonomous Region . Components : Rehabilitation of irrigation and drainage over an area of 210,000 ha complemented by agricultural support and extension services in the Hatao Irrigation Area of Inner Mongolia; Upgrading and completing irrigation and drainage works on 22,000 ha and developing new irrigation over 14,200 ha at Yinnan in Ningxia; Voluntary resettlement of 11,000 families below the poverty line on the newly developed land, complete with infrastructure and basic social services; Staff and farmer training with a focus on women farmers and technicians; and Technical assistance for the feasibility study of 130,000 ha of existing cultivated area and 100,000 of potentially irrigable land at Yinnan . Financing and Costs : Total project cost at appraisal was US$ 234.3 million for which an IDA credit of US$103 million was approved in March 1988. Actual total project costs were US$ 212.7 million. 3. Achievement of Relevant Objectives : All relevant objectives were achieved and in most cases exceeded SAR targets . 4. Significant Achievements : 14, 14 ,350 ha of desert wasteland has been converted to productive irrigated cropland; 11 ,278 voluntary resettled families increased by between 27 and 56 percent more than the SAR Incomes of 11, estimate and has removed them from absolute poverty; Land resources in the area vacated by the resettlers has improved the conditions for those families remaining ; 111 ,800 families in existing irrigated areas increased by about 25 percent more than SAR Incomes of 111, targets; 150 ,000 female farmers were trained and 25, Over 150, 25 ,800 females were trained in household economics; Cultural identity has been enhanced among the resettled Islamic Hui majority who can now afford Mosques and community facilities; Farmer -owned agromachinery has increased by 32 percent in Hatao and 60 percent in Yinnan; Crop yields have improved significantly and waterlogging /salinity reduced; ERR ) was 29 percent compared with the SAR estimate of 20 percent . The economic rate of return (ERR) 5. Significant Shortcomings : Environmental externalities : The SAR predicted that improved drainage of irrigated areas would degrade the  29,000 ha Wulianghsuhai Lake (an important fishery and reed production (for paper) area) and put in place a mitigation program. Unfortunately, local authorities unconnected with the project have discharged industrial and urban effluents into the improved drains thus making the situation much worse than expected . Government is seriously addressing this problem . Procurement of technical assistance caused a two year delay in project completion but the hiatus proved beneficial as it enabled improved procurement of services and equipment . 6. Ratings : ICR OED Review Reason for Disagreement /Comments Outcome : Satisfactory Highly Satisfactory Exceeded SAR physical targets, high ERR and very significant institutional and social benefits, particularly resettlement . Institutional Dev .: Partial Substantial This was not rated in the draft ICR prepared by the Resident Mission and the "partial" (added later) does not give due credit to the project's achievements . Sustainability : Likely Likely Bank Performance : Satisfactory Satisfactory Borrower Perf .: Satisfactory Satisfactory Quality of ICR : Satisfactory 7. Lessons of Broad Applicability : Well-planned voluntary resettlement projects based on newly irrigation land is effective in reducing rural poverty . 8. Audit Recommended? Yes No Why? To determine the sustainability of the poverty alleviation /resettlement component that has been replicated in a follow-on project, the effectiveness of O&M, and mitigation of the lake pollution problem affecting an internationally important wetland. 9. Comments on Quality of ICR : Household income improvements are grossly exaggerated because the effects of inflation are ignored because the Region questions the applicability of the Chinese retail price index as a deflator in poor rural areas . The plan for future operations appears to be only a list of intent but this may be because of translation problems with the tenses .