India - Inland Fisheries Project

Document of The World Bank FOR OFFICIAL USE ONLY FILE COPY Report No. 2496-IN INDIA INLAND FISHERIES PROJECT STAFF APPRAISAL REPORT November 16, 1979 Agriculture D Division South Asia Projects Department 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 1/ US$1.00 = Rs 8.60 Rs 1.00 = US$0.116 Rs 1,000,000 = US$116,279 WEIGHTS AND MEASURES 1 kilogram (kg) = 2.20 pounds 1,000 kg - 1 metric ton = 0.98 long ton 1 meter (m) = 1.09 yards 1 hectare (ha) = 2.47 acres (ac) ABBREVIATIONS ARDC - Agricultural Refinance and Development Corporation CMCC - Central Monitoring and Coordination Committee CPU - Central Project Unit CIFRI - Central Inland Fisheries Research Institute FFDA - Fish Farmer Development Agency FSDC - Fish Seed Development Corporation GOI - Government of India PB - Participating Bank SMCC - State Monitoring and Coordination Committee SPU - State Project Unit GLOSSARY Fish Seed - Fish from the stages of egg larvae to fingerling. Spawn - Fertilized eggs and hatchlings. Hatchling - Fish larvae after emergence from egg to about 0.8 cm size. Fry - Young fish from hatchling to about 2.5 cm size. Fingerling - Young fish of about 2.5 cm or longer; 5.0 cm is standard. Composite Fish - Growing two or more species of fish in a pond to optimize Culture productivity; often synonymous with polyculture or mixed fish culture. Fish Hatchery - Fish seed production unit with facilities for brood stock, artificial spawning and raising fingerlings. Fish Seed Farm - Fish seed unit with facilities for raising fingerlings from spawn, but no hatchery for producing spawn. Tank - A pond or a small reservoir of variable size, mostly for irrigation, general village use or fish farming. Bund Tank - Natural or man-made pond with an open side through which runoff water can enter. Bund Breeding - A system of natural breeding of carp in captivity; requires special natural conditions and has been used successfully with only two major Indian carp species. 1/ Until September 24, 1975, the Indian Rupee was officially valued at a fixed Pound Sterling rate. Since then it has been fixed against a "basket" of currencies. As these currencies are floating, the US Dollar/Rupee exchange rate is subject to change. Conversions in this report are based on the projected exchange rate during the project period.  FOR OFFICIAL USE ONLY INDIA INLAND FISHERIES PROJECT STAFF APPRAISAL REPORT Table of Contents Page No. I. THE INLAND FISHERIES SECTOR ........................... 1 Inland Fisheries in India ........... ..1........... Carp Consumption and Marketing . . 2 Fish Farming Development Policies and Programs ... 4 Carp Seed Technology ............................. 7 Potential for Fish Culture Development ........... 8 Constraints to Fish Farm Development ............. 9 1I. THE PROJECT ........................................... 9 Project Concept .................................. 9 Objectives and Major Features ................ 9 Project Area ................ .. ................... 10 Fish Hatcheries .................................. 11 Hatchery Approach Roads ........... .. ............. 12 Fish Farmer Development Agencies ........ ......... 12 Fish Pond Credit .............. .. ................. 13 Training Centers for Fisheries Extension ......... 13 Technical Assistance ............ .. ............... 14 III. PROJECT COSTS, FINANCING, IMPLEMENTATION AND DISBURSEMENT .................................... 15 Project Cost Estimates ........... .. .............. 15 Financing ....... ............. .................... 18 Lending Terms and Conditions ........ .. ........... 18 Project Implementation ........... .. .............. 20 Procurement ...... ............. ................... 21 Disbursements ................ .. .................. 22 Accounts and Audits ............. .. ............... 22 IV. ORGANIZATION AND MANAGEMENT ........................... 23 General ..................... ..................... 23 Coordination and Implementation ......... ......... 23 GOI Central Project Unit ......... .. ............ 23 GOI Central Monitoring and Coordination Committee .................................... 24 State Project Units ............................ 24 State Monitoring and Coordination Committees ... 25 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.  - ii - Table of Contents (continued) Page No. Fish Seed Development Corporations .... ......... 25 Fish Farmer Development Agencies .... ........... 27 Monitoring and Evaluation ........................ 28 Credit Organization .............................. 28 V. PROJECT PRODUCTION, MARKETING AND PRICES .... .......... 29 Carp Seed Production ............................. 29 Carp Production .................................. 30 14arketing ........................................ 31 Prices ........................................... 31 VI. FINANCIAL AND ECONOMIC ANALYSIS ....................... 31 Financial Analysis ............................... 31 Economic Analysis ................................ 32 Project Benefits and Beneficiaries .... ........... 32 Long Term Development Impact ..................... 33 Risks ............................................ 33 Environmental Impact ............................. 33 VII. RECOMMENDATIONS ....................................... 34 This report is based on the findings of an appraisal mission composed of Messrs. R. Reidinger, W. Schwermer, Y. Tang, L. Sprague, and Ms. N. Pinto (IBRD), and Messrs. B. Meeke (Consultant) and B. Shetty (ARDC) which visited India in January - February, 1979.  - iii~ - Table of Contents (continued) ANNEXES 1 - Project States and Districts and Hatchery Site Guidelines 2 - Project Cost Estimates 3 - Financial Analysis and Cash Flow Projections 4 - Economic Analysis 5 - Estimated Quarterly Schedule of Disbursements 6 - Related Documents and Data Available in Project File CHARTS GOI Inland Fisheries Organization Chart (20293) State Fisheries Departments Generalized Organization Chart (20310) Fish Seed Development Corporations Organization Chart (20294) Project Implementation Schedule (21012) Hiatchery and Approach Road Construction Implementation Schedule (20304) Plan of 25 Ha Hatchery Model (IBRD 14268) Plans of 5 and 10 Ha Hatchery Models (IBRD 14269) Plans of 10 Hia and 25 Ha Model Hatchery Building (20215) Hatchery Building Cross Section (20216) Central Channel and Perimeter Bund Cross Sections (20217) Pond Dividing Bunds (20218) Details of Subsidiary Gate (20219) Details of Division Box (20220) MAP Proposed Project Area (IBRD 14267R)   I. THE INLAND FISHERIES SECTOR Inland Fisheries in India i.01 Background. Inland fisheries in India is an important economic activity, which in 1977 produced some 875,000 tons of food fish, accounting for about 35% of India's total fish production of about 2.6 million tons. Inland fisheries comprises two types of activities, capture fisheries and fish farming. In terms of total production, capture fisheries is by far the more dominant at present, accounting for some 765,000 tons out of total inland fisheries production in 1977. Capture fisheries is practiced mostly in the major rivers, lakes, and reservoirs of both fresh and brackish waters. It involves various types of seining and gill-netting for a number of species of carp, catfish and miscellaneous fish in fresh waters, and hilsa and mullet in brackish waters. 1.02 Over the past ten years, capture fisheries production has not quite kept pace with total fish production, growing at an average annual rate of about 6% compared to 7% for total fish production and 8% for marine fish pro- duction. It appears that a significant further increase in capture fisheries production is highly unlikely because of the deterioration of the fish habitat due to proliferation of water control structures, industrial water use, and extensive overfishing in many of the traditional grounds where the most important commercial fresh water species are harvested. 1.03 Fish farming of carp, which in India is a highly preferred fish species and the only commercially farmed species, is the major source from which an increased supply of fresh water fish can be expected in the future. As a source of carp supply, fish farming is now nearly as important as capture fisheries and provides about 40% of the total annual carp production of about 290,000 tons. The area of fish ponds under carp culture in India currently totals about 450,000 ha. At present, however, fish seed supply to these ponds depends mainly on river collection of spawn and fingerlings. Like capture fisheries, river collections in some regions have been severely reduced by river habitat deterioration. In addition, wild spawn and fingerling collec- tions from rivers are highly variable from year to year and are of progres- sively lower quality, on the average containing about 40% undesirable and predator fish species. Growth in both area and productivity of cultured fish ponds is severely constrained by the lack of high quality fish seed. 1.04 India's fish farming history covers many centuries. Fish farming is practiced throughout India, but the five leading pond-culture states (West Bengal, Bihar, Orissa, Madhya Pradesh and Uttar Pradesh) accounted for some 100,000 tons of the total cultured carp production of 110,000 tons in 1977 and about 70% of the total water area for cultured fish ponds of 10 ha or less. The main species farmed are, in order of importance, catla, mrigal, and rohu (all Indian major carp). About 500,000 households are engaged in fish farming, and typically each of these households manages a small pond less than 1 ha in size. In general, it is the lower socioeconomic segments of the population which are engaged in both fish farming and the fish trade. Most Indian fish farmers are experienced and hardworking, but they need better quality seed, credit for fish pond improvements and inputs, and training and upgrading of practices to improve their productivity.  - 2 - 1.05 Fish Farms, Farming Practices and Yields. Indian fish ponds are typically rainfed and generally range in size from about 0.5 ha to about 2 ha, averaging about 1 ha. Where groundwater levels are high, as in the lower Gangetic delta regions and low lying areas of other large river basins, ponds are perennial and have sufficient water for fish culture all year round. Village ponds and tanks often have several uses, and competition for water for other uses is high, especially during the dry season. This competition can limit the intensity of management, particularly with regard to input use and fish stocking and harvesting. 1.06 Under traditional fish farming practices, ponds are usually stocked with wild carp seed which includes the species of Indian major carp. Stocking is done in June and July each year after the natural riverine spawning which occurs following the first monsoon rains. Marketable fish are harvested in the following March and April season when pond water levels are relatively low. The supply of seed is often inadequate and the quality poor, with high content of low value and predatory species. Little fertilizer and feed is used, except in West Bengal where fish farming is more highly developed. As a result, yields are low, ranging from about 100 kg/ha to about 600 kg/ha and averaging about 350 kg/ha. Where cultural practices are more advanced as in West Bengal, however, yields sometimes exceed 2,000 kg/ha. 1.07 Fish Pond Tenure. Most fish ponds in India are owned by government agencies such as State Revenue or Fisheries Departments or village panchayats. Only in West Bengal, Bihar and Orissa is private pond ownership substantial, accounting for about 94% of the fish pond area in West Bengal and about 40% in Bihar and Orissa. Government entities commonly lease fish ponds to private individuals or cooperative societies for fish production for a period of one or two years on the basis of public bidding or negotiations. Recently, State governments have been gradually shifting toward longer lease terms for small ponds because institutional finance for developing ponds is available only with leases for nine to ten years. Operators leasing ponds usually reside near the ponds. Private ponds are generally owner-operated; about 85% are owner oper- ated in West Bengal, for example. Individual fish farmers may operate several ponds. Carp Consumption and Marketing 1.08 Market Situation and Prices. In 1977, carp consumption including spoilage and losses totalled approximately 290,000 tons of which about 220,000 tons were Indian major carp. Among fresh water fish species, the various species of Indian major carp, particularly catla and rohu, are the most pre- ferred by Indian consumers. Although vegetarianism predominates in the upper social classes, about 70% of the Indian population is non-vegetarian, and surveys indicate that this percentage is rising, due mainly to the changing dietary habits of the younger generations. The value of fish as a source of animal protein is increasingly recognized, and fish along with unfertilized eggs constitute one of the most acceptable non-vegetable items of diet to many vegetarian households. Fish is widely consumed in most large Indian cities; for example, a recent study of fish consumption found that 88% of the house- holds in Calcutta, 59% in Bangalore and 45% in New Delhi consume fish. Annual  - 3 - fish consumption per capita in these cities is 12 kg, 9 kg and 7 kg, respec- tively. At present, the national average annual consumption is 4 kg per capita, compared to fish requirements of 10 kg per capita as estimated by GOI on the basis of nutritional standards. In some regions of the country, the proportion of fish consuming population is especially high; for example, 94% in West Bengal. 1.09 Over the last decade, total fish production and consumption has grown at nearly 7% annually, nearly three times the annual rate of population growth. During that period fish prices have maintained rough parity with competing animal protein sources and increased substantially faster than prices for food in general and all commodities together. Indian consumers show a marked pre- ference for carp compared to most other fish species. In view of the rela- tively high elasticity of demand for carp, it is considered that a 10% annual increase in carp supply could be absorbed by the market with no adverse impact on relative prices. Furthermore, while carp is generally preferred by high income consumers, greater supplies of carp should free more of the lower value fish species for low income consumers. An increase in carp supplies of 10% annually would call for a total annual supply of about 750,000 tons by 1987. Since capture fishery resources for carp are essentially fully exploited and in fact show signs of declining, most of the increase, some 460,000 addi- tional tons annually, would have to come from fish culture. Such an increase would require an average annual growth rate in cultured carp production of about 18% during the decade to 1987, a requirement very difficult to fulfill even with greatly intensified efforts. Market conditions are therefore not expected to constrain rapid development of carp farming. 1.10 The overall average retail price of fish in Calcutta, the most rep- resentative fish market in India, advanced from about Rs 6.10 per kilo in 1972 to Rs 12.75 per kilo in 1977, increasing at an average rate of about 16% annually. In recent years, carp has shown relatively strong prices compared to other fish varieties. Pond side prices for carp in 1978 averaged about Rs 4.00/kg compared to Rs 3.50/kg in 1977. 1.11 Marketing System and Structure. About 70% of the carp produced moves to the larger towns and cities through well organized commercial marketing channels. Specific channels vary somewhat from place to place, but generally producers sell directly to a consigner who aggregates catches from adjacent areas, supplies local land transport, provides marketing capital and arranges transportation of the fish to a broker in a larger market like Calcutta. The broker sells to wholesale traders who in turn supply retailers. The remaining 30% of the carp produced is sold locally by the producers or sent to commis- sion agents and sold wholesale at auction to peddlers or retailers in rural and small towns. Present commercial channels appear adequate to handle anticipated growth in carp supply. 1.12 Transportation of inland fish is by rail and truck. If transporta- tion time from producer to consumer is more than 24 hours, ice packing is used. Fresh fish are commonly shipped in bamboo baskets covered and lined with burlap and holding 30 to 40 kg of fish and 20 kg of ice. The packages are re-iced on long hauls and re-icing facilities are available along rail  -4- routes. Compared to marine fish, inland fish require very different trans- portation, storage and warehouse facilities. Whereas marine fish are landed at relatively few sites in large, unpredictable batches, inland fishing grounds and ponds are widely dispersed and require many short hauls of rela- tively small volume to assembly points for transshipment. Fish from inland waters, particularly from fish ponds, can be netted when market demand and prices are right. Inland fish, therefore, generally require less storage facilities than marine fish, or most other crops for that matter, since the crop is essentially stored in the pond until needed. 1.13 The private fish trade appears to be reasonably efficient and com- petitive. The existing marketing network for fresh water fish is integrated at. the national level with the Calcutta regional market which is the leading market for inland fish in the country. Supply and demand conditions in that market set the general price level for carp throughout most of India at any given time or season. Calcutta is the largest consuming and trading center in the country for inland fish. Central Calcutta has nine wholesale and about 170 retail fish markets. The largest wholesale market serving the Calcutta city area is Howrah, which handles about 60% of the wholesale fish marketed in Calcutta city. Most of the fish marketed at Howrah arrives by rail from other states. Trade in the Calcutta wholesale fish markets is highly competitive. In Howrah market alone, there are 150 large brokers, 110 of which handle more than Rs 1 million in sales annually and ten of which handle sales of more than Rs 4 million annually. The value of sales in the Howrah market annually totals about Rs 160 million. Analysis of marketing costs and margins indicates that the Calcutta market price yields a producer price of about 35% of the consumer cost. In rural markets, the producer would get about 40% of the consumer price for whole fish. Marketing margins do not appear significantly different from comparable margins for similar fishery products in other countries. Fish Farming Development Policies and Programs 1.14 GOI policy aims at increasing fish farm production, raising fish farmers' net income and creating employment for the landless rural population. It is generally agreed that leasing patterns for public water bodies which discourage private investment, lack of quality seed and low use of inputs are key constraints to the development of fish farming in India, and GOI gives a high priority to lifting these constraints through a number of extension, training, research and credit activities. 1.15 Fish Farmer Development Agencies. In 1973, GOI began to organize Fish Farmer Development Agencies (FFDAs) on a pattern similar to the Small Farmer Development Agencies to spearhead implementation of GOI inland fish- eries policies and to provide a field mechanism for coordinating the agencies involved and integrating the various activities connected with fish farming development throughout the country. To date, 50 FFDAs completely funded by GOI have been set up at the district level in various States. According to recent governmental policy decisions, FFDAs in the future will remain as centrally sponsored schemes, but State governments will bear 50% of the FFDA costs. At the field level, FFDAs help arrange fish pond leases between government bodies and private individuals or cooperatives, promote fish farming, popularize improved techniques, provide training and extension services, assist in arranging financing and organize fish farmer cooperatives.  -5- FFDAs also provide a 25% subsidy to selected fish farmers for fish pond improvements and first-year inputs to help encourage expansion of fish farming and adoption of improved practices. FFDA staff are generally drawn from State Fishery Departments and coordinate closely with Fishery Department activities. In districts where they operate, FFDAs take over most extension responsibili- ties from the State Fisheries Departments, provide short-term training courses, and help secure fish seed and administer and supervise credit for fish pond production expenses. Although FFDA field operations have been underway for only three or four years, experience to date indicates that the FFDA pattern of organization can provide an effective vehicle for the proposed project to promote fish farming development. 1.16 State Fishery Departments. State Fisheries Departments have res- ponsibility for implementing State government policies and programs aimed at developing inland fisheries and, in maritime states, marine fisheries. They generally have responsibility for extension, research, training, development of fisheries cooperatives, operation of fish seed farms, and various special projects. Fish culture extension and development activities are primarily the responsibility of the State Fishery Departments. Most State Fishery Depart- ments have a staff which is competent but too small to provide the intensive extension support necessary for rapid development of fish culture, in addition to other responsibilities. Fishery Extension Officers are stationed at the district and sometimes block level. Fishery Departments also operate a variety of training programs for farmers and youths as a part of their extension programs. West Bengal, Orissa and Andhra Pradesh operate special training schools for fish farmers where educated, unemployed youths can take several weeks training to learn the basics of fish farming. These training programs are generally undertaken in conjunction with the extension activities. A recent GOI review of the State fish farming development programs under the Fifth Five-Year Plan emphasized the need for increased State Fishery Department involvement in development activities, particularly in expanding FFDA coverage to more districts, establishing carp hatcheries to increase fish seed produc- tion in support of increased FFDA operations, and developing and maintaining fisheries management programs for lakes and large reservoirs. 1.17 Fisheries Training and Education. The Central Institute for Fishery Education (CIFE) at Bombay provides most of the fisheries training in India, and with its subordinate institutions, has trained a large number of fisheries officers in fish culture techniques and extension. CIFE was established in 1961 under the GOI Department of Agriculture and Rural Development to train gov- ernment fishery officers for service in the various States, and has a staff of some 211 members. It has developed a comprehensive program aimed at providing technical skills for implementing development projects for both inland and marine fisheries. Most students come from the government service, although a few candidates are nominees from private industry and foreign countries. CIFE has adequate laboratory, library and training vessel facilities and maintains a high standard of training. It offers a two-year post-graduate diploma course in fishery science, with a syllabus covering fishery biology, fish processing technology, fisheries administration, economics, fisheries sta- tistics, marketing and cooperatives. Students receive extensive theoretical training and practical work. Intake capacity is about 40 candidates per year, and to date CIFE has trained a total of about 400 students.  -6 1.18 CIFE also conducts lover level training courses at several subordi- nate establishments. The Inland Fisheries Training Unit at Barrackpore in West Bengal gives a one-year certificate course in inland fisheries develop- ment and administration for about 40 candidates a year, and has trained almost 1,000 students in total. hle Regional Training Center for Inland Fisheries at Agra in Uttar Pradesh provides training in inland fish farming practices with a nine-month certificate course for about 80 candidates per year, having trained to date about 350 students. At Hyderabad in Andhra Pradesh, the Central Fishery Extension Training Center gives specialized in-service training in fish farming extension techniques, methods and practices at the post-graduate level, mainly for State Fishery Department Extension Officers. These centrally-sponsored training programs are effective but provide only a fraction of the trained extension personnel needed at the State level for rapid development of inland fisheries. The proposed project will build on existing training activities and strengthen State-level training capabilities. 1.19 Fisheries Research. Research on inland fisheries is primarily the responsibility of the Central Inland Fisheries Research Institute (CIFRI) which has made a major contribution to fish culture development in India through its research on induced breeding of carp and composite fish culture. CIFRI was established in 1947 and is now part of the Indian Council of Agricultural Research (ICAR). Headquartered at Barrackpore, CIFRI has several central substations and 11 research units in other parts of India, with a total staff of 652 members. Also based at CIFRI are four all-Indian coordinated research projects involving cooperative programs with State governments. The principle objective of CIFRI is to study the application of scientific principles to maximize fish production from inland waters. CIFRI has adapted induced breed- ing techniques and developed carp culture practices for optimum fry, fingerling and fish production in various parts of India. Related research includes investigations of riverine fish population structure and spawn behavior and the development of riverine and estuarine fish catch statistics. Virtually all the highly-trained scientific personnel presently working on fresh water fisheries development in India have been directly or indirectly associated with the work of CIFRI, and CIFRI research has provided the technological basis for most of the current programs aimed at expanding fish farm production in India including the proposed project. 1.20 Institutional Credit. As of June 30, 1978, the Agricultural Refinance and Development Corporation (ARDC) had approved 42 inland fisheries schemes in various States financed through commercial banks and Land Development Banks for a total of about Rs 64 million in lending; disbursements under the schemes totalled only about Rs 8 million. The total for these schemes is small, less than 1% of total ARDC commitments, and credit demand under the schemes has been limited by shortages of high quality fish seed, inadequate fishery extension services and unfavorable lease terms for publicly-owned fish ponds. The new ARDC III IDA-supported line of credit includes an indicative total for lending to the inland fisheries subsector totalling about Rs 260 million. In its schemes, ARDC currently classifies sub-borrowers into low, medium and high income categories depending on net annual fish farm income (based on 1972 prices). Low income borrowers receive concessionary terms with interest rates of 9.5% compared to the standard 10.5% rate, and margin money requirements as  low as 5%. Until recently, ARDC loans to fish farmers of all sizes carried a uniform interest rate of 11%. ARDC also refinances fish pond credit require- ments under FFDA programs which provide a 25% subsidy as margin money. Carp Seed Technology 1.21 Carp Seed Industry. The all-India supply of carp fingerlings or fingerling equivalents including fry currently totals about 290 million. About 140 million of the 290 million are wild seed collected and used by private operators, and 150 million are fingerlings produced by 152 State fish seed farms mostly from spawn collected from rivers. Only a few of these farms have hatcheries for artificial breeding, accounting for about 8% of the total spawn supply, and most farms simply raise riverine spawn to marketable size fingerlings. Of the total fingerling supply, about 200 million fingerlings are stocked in some 450,000 ha of fish ponds, and about 90 million fingerlings, mostly from State fish seed farms, are used by State governments for stocking large lakes and reservoirs which are not included with fish ponds in this report. 1.22 Most of the supply of fish seed in India originates in the rivers of the Gangetic basin, particularly in West Bengal and Bihar, largely in the form of spawn collected by private producers. Of the wild-caught spawn, about 60% is used by small, private fish seed producers, particularly in West Bengal, and about 25% is distributed to State-owned fish seed farms. Generally operated by State Fisheries Departments, State fish seed farms are a principal source of the fish seed supply used by Fisheries Departments and FFDAs to promote fish farming. Seed produced by State seed farms is also sold locally to private users, often at subsidized prices. 1.23 A major share of the spawn sold commercially moves through the Calcutta fish seed market. About 15% of the total spawn supply is bought by the Calcutta-based Fish Seed Syndicate Ltd., which was established as a coop- erative in 1950 to promote the development of the fish seed industry and is the only commercial operation supplying fish seed on a large scale in the country. The Fish Seed Syndicate buys spawn and produces marketable size fish fry. It sells to fish farmers and government entities throughout the country, in some cases shipping by air for distances over 500 km. In recent years, shipping of fingerlings oxygen-packed in polyethelene bags has enabled trans- portation times of up to 48 hours with very low mortalities. 1.24 Overall, the fish seed industry in India is at present almost entirely dependent on river collection of wild seed. The quantity of spawn supplied from hatcheries by artificial breeding is small. In recent years, both quantity and quality of wild capture seed has steadily declined due to deterioration of natural river habitat caused by water control structures and industrial growth. Since the mid-1960s, annual spawn collection has fallen by about 30%, and currently collections contain at best only about 60% carp, the remainder being undesirable species and predators. In addition, river collections vary widely from year to year, and collection periods under natural conditions are short. Although the development of intermediate technologies, primarily bund breeding, has cushioned the impact of this decline and to some extent filled the gap between natural seed supplies and demand, the scope for further expansion of  -8- such techniques is limited. Bund breeding is a system of natural breeding of carp in captivity which requires special natural conditions which are uncon- trollable and, unlike fish hatcheries, is not independent of the monsoon season. Future fish farming development will depend heavily on the development of a modern fish seed industry based on hatcheries using artificial breeding under controlled conditions to produce adequate quantities of improved quality seed, which is a major objective of the proposed project. 1.25 Induced Breeding and Composite Fish Culture. India has a large and well-organized body of highly competent aquacultural scientists who have achieved major breakthroughs in several important technical aspects of fish culture. Since about 1957, Indian scientists have succeeded in artificially breeding Asiatic carp, including both major Indian and Chinese carp species, by applying pituitary hormone injection techniques known as hypophysation, and have refined and adapted to Indian conditions these techniques for the reproduction of carp in captivity. This has been an important contribution to the potential for modernization of carp farming by providing a foundation for modern carp hatchery development. All Indian major carp species spawn in rivers and only during the monsoon. Induced breeding makes possible the production of large quantities of high quality carp seed independently of the monsoon under controlled conditions, extending the breeding season to about six months (March through August) compared to the natural spawning season (June and July). Building on these developments, Indian scientists carried out large scale research on fish pond management and developed what is now called "composite fish culture" using the proper combination of carp species to optimize fish pond productivity. Development of induced breeding has enabled the production of seed with the optimum combination of desirable carp species to exploit fish pond productive capabilities more fully and pro- duce high yields of the most financially attractive mixture of carp species. Potential for Fish Culture Development 1.26 India has all the conditions necessary for rapid development of fish farming. It has 1.6 million ha of water bodies potentially suitable for inten- sive fish farming, and a very large number of fish farmers experienced in fish farm management. It also has a large number of aquacultural scientists and technicians specialized in artificial production of carp seed to support a well planned program of research and development activities. In addition, a large market exists for carp, as well as a clear need for supplying additional protein to a large population. 1.27 At present, only about 450,000 ha out of the estimated 1.6 million ha of potentially suitable water bodies are used for fish farming. Provided appropriate measures are taken, particularly with respect to tenure practices, roughly 1.2 million ha remaining unused can be brought under fish farming over the next 10 to 20 years. In addition, with good pond management and adequate supplies of high quality seed and complementary inputs, it appears that a high level of average yields can be achieved for both the existing fish ponds and the new ponds to be brought under culture, raising yields from an estimated annual average of 350 kg per ha at present to over 1,200 kg per ha during the coming decade. This increase in productivity and expansion of fish pond area  -9- can be accomplished on the basis of a well known and proven technology already practiced in some parts of India, especially in West Bengal. Constraints to Fish Farm Development 1.28 Four principle constraints limit rapid development of carp farming in India: (i) a shortage of carp seed in general and of high quality seed in particular; (ii) fish pond tenure arrangements which generally permit only short-term leases and thus discourage farmers from making long-term commit- ments and investments for improvement of fish ponds; (iii) inadequacy of extension services at the fish farm level designed to guide farmers in improving water level control and optimizing the practices of stocking and applying fertilizer and supplementary feed inputs; and (iv) lack of long- term credit for fish pond improvements and short-term credit for fish seed, fertilizer and supplementary inputs. The proposed project would help remove these constraints. II. THE PROJECT Project Concept 2.01 India has most of the necessary elements and a great potential for rapid expansion of fish farming -- an improved technology, extensive domes- tic markets, trained personnel, experienced fish farmers and substantial under- utilized fish pond resources. Lacking, however, are the high quality fish seed in large quantities and the broad institutional and organizational base needed to unlock this potential. The situation is analogous to that of food grain production in the mid-1960s when the introduction of high yielding seed for wheat and rice triggered a green revolution in agriculture. The proposed project would provide these missing key elements through construction of modern fish hatcheries to produce high quality fish seed, and support of substantial institutional development and strengthening in the inland fisheries subsector. Objectives and Major Features 2.02 The project would assist GOI and five participating States in their efforts to implement fish farming development programs. The main objectives of the project would be to (i) increase carp production in West Bengal, Bihar, Orissa, Madhya Pradesh and Uttar Pradesh, and (ii) provide a basis for the future commercial development of the carp seed industry in India, which is essential to increase production of inland fish in the future. The project would provide: (i) credit to State Fish Seed Development Corporations for construction of about 27 modern fish hatcheries to be used to produce carp fingerlings; (ii) credit to fish farmers for improvement of fish farms; and (iii) funds for strengthening fisheries extension, establishing training centers and technical assistance.  - 10 - Project Area 2.03 The project would cover a total of 58 districts in the five project States of West Bengal, Bihar, Orissa, Madhya Pradesh and Uttar Pradesh (see project districts listed in Annex 1). The area of fish ponds of 5 ha size or less in the project districts totals about 258,000 ha, of which about 117,000 ha would be included in the project. The project districts were selected to be contiguous areas where fish farming is generally practiced and where marketing and transportation facilities are available. 2.04 Fish Pond Models. Within the project area, three general fish pond models (types A, B and C representing typical conditions for project analysis and cost estimation purposes) would be developed. Details by State are as follows: ----- Project Districts ------- --- Production Models ---- Project Number of Cultivable Project Low Medium High States Districts Pond Area Pond Area Type A Type B Type C (area in '000 ha) West Bengal 11 137 34 0 3 31 Bihar 17 33 26 10 8 8 Orissa 7 22 16 3 6 7 Madhya Pradesh 6 34 25 16 6 3 Uttar Pradesh 17 32 16 9 4.5 2.5 Total 58 258 117 38 27.5 51.5 The different pond models A, B and C represent respectively low, medium and high production capabilities. West Bengal is expected to have by far the largest share of the Type C high-production fish ponds largely due to the high concentration of private fish ponds, which account for about 97% of the fish ponds and 94% of the fish pond area in the project districts in the State. Differences in production capability under average levels of management are due, for example, to soil type and fertility, degree of competing water use, pond water depth and social factors. Fish pond models would require corres- pondingly low, medium and high stocking rates for fingerlings, intensity of input used and investment in improvements. Hatchery and fish pond investment requirements under the project for both fish ponds and hatcheries are derived from these three models. Fish pond models A, B and C represent average conditions for the entire project area, and actual fish pond improvement and input requirements in specific areas may differ from the models, details for which are given below: Financed Fish Pond Fish Pond Fingerling Year 1 Annual Investment Production Yields Stocking Rate Inputs Input Cost Cost Model Kg/Ha Nos./Ha Rs/Ha Rs/Ha Rs/Ha Type A 800 2,500 524 1,154 940 Type B 1,500 3,800 792 2,022 2,772 Type C 2,500 5,000 1,020 6,920 6,202  - 11 - Fish Hatcheries 2.05 Investments in hatcheries would be designed to remove the constraints to increased fish farm production in the project area due to inadequate supply and poor quality of fingerlings for stocking fish ponds. Except for very limited supplies available from research institutions, the combination of species for composite culture is unavailable to fish farmers. Project hatch- eries would produce high quality seed of the carp species required by individual fish farmers. 2.06 The project would finance in the project States about 27 hatcheries in 10 ha and 25 ha model sizes, measured in terms of hatchery pond water area. Project hatcheries would be constructed on a contract basis and operated by a State-owned Fish Seed Development Corporation to be established in each State, which would employ suitably qualified engineers for engineering design and supervision during the construction period. At full development, the hatcher- ies would produce a total of nearly 460 million carp fingerlings. Details are given below: Number of Hatcheries Million 10 Ha 25 Ha Total Fingerlings West Bengal 5 4 9 158 Bihar 4 2 6 94 Orissa 2 2 4 74 Madhya Pradesh 2 2 4 74 Uttar Pradesh 3 1 4 57 Total 16 11 27 457 2.07 All hatcheries would be of conventional design suitable for large- scale commercial production of Asiatic carp seed and would include an indoor hatchery unit, earthen ponds, watergates and channels, tubewells (see para 2.08 for iMadhya Pradesh), administrative buildings, staff residences, storage buildings, perimeter fencing and internal roads (see Maps IBRD 14268 and 14269, and Charts 20215 through 20220). Each hatchery complex would provide adequate controlled environment facilities for artificial spawning (hypophysation) of carp, egg hatching and larval nursing in indoor hatcheries under controlled water temperature conditions, as well as earthen ponds (approximately 18 and 32 ponds, respectively, for 10 ha and 25 ha hatcheries) for husbanding of brood stock and rearing of carp fingerlings. About 25% of hatchery pond area would be used for brood stock, approximately one-third of which would be replaced each year. Provision would also be made for communications and for electric power, with auxiliary power facilities to meet critical minimum needs, if necessary. At full operation, the two model sizes of hatcheries would be capable of producing 10 million and 27 million fingerlings respectively of 5.0 cm size. In addition, about an equal number of 2.5 cm carp fry could also be produced to supply fish farmers who are operatiag carp nurseries or raising fry to marketable size table Eish. The hatcheries could, if necessary, produce twice as many 2.5 cm fry as compared to 5.0 cm fingerlings. 2.08 Selection of each hatchery site would be based on the results of soil testing for engineering and fertility analysis, availability of suffi- cient land for all facilities of the hatchery complex (14 ha for a 10 ha  - 12 - hatchery and 33 ha for a 25 ha hatchery), demand for fingerlings, availability of electricity and communications, avoidance of social displacement, and avail- ability of assured water supplies (see Annex 1, page 2). Details of specific criteria for selection of hatchery sites were discussed at negotiations and these will be incorporated in the project banking plan (see para 4.15). An independent secure source of water supply at the hatchery would be essential to the comamercial viability of project hatcheries, since they would be expected to produce fingerlings during the dry season. In all States except Madhya Pradesh, ground water supplies appear to be adequate. In Madhya Pradesh, project hatcheries would have to depend on surface water supplies. The Madhya Pradesh Irrigation Department has indicated that adequate surface water sup- plies would be available as needed provided hatcheries are located near the sluice gates of minor tanks commanded by major tanks. Alternatively, water could be pumped from reservoir dead storage for the hatchery. Water requije- ments during the critical April to J ne period are estimated at about 2 ft /sec for each 10 ha hatchery and and 4 ft /sec for each 25 ha hatchery. The Govern- ment of Madhya Pradesh has assured that adequate surface water supplies will be made available, and has identified a number of sites for which water sUp- plies can be assured. Hatchery Approach Roads 2.09 The project would provide for construction of approach roads linking project hatcheries with existing communications. Road requirements are esti- mated to average about three kilometers per hatchery. Road construction would include design, base formation, metalling, and black topping adequate to pro- vide an all-weather communication link for the hatchery. Width of the roads would be about 3.0 meters of bituminous carpet on stone metal over a formation six meters wide. Road construction in West Bengal would include, where neces- sary, timber piling bulkheads due to the particularly high watertable condi- tions prevailing in the project area in that State. Road constructiorn would be executed by local contractors selected t'hrough local competitive bidding and supervised by the State PWD. Arrangements for road maintenance would be trhe responsibility of PWD. Fish Farmer Development Agencies 2.10 Under the project, 15 existing Fish Farmer Developmaerit Agericies (FFDAs) serving 16 districts would be strengt'hened in districts where GOI- sponsored FFDAs are already operating, and new FFDAs would be established with State sponsorship to serve the remaining 42 districts. FFDAs would provide extension services, and assistance to fish farmers in obtaining fish pond leases on improved terms and credit under the project. FFDAs would pro- vide a subsidy of up to 25% for fish pond improvement plus first year cash input costs, depending on budgetary provisions made by GOI and project states. The subsidy and FFDA establishment costs would be borne by GOI for existing FFDAs and by the States for new FFDAs. IDA financing of FFDA incremental costs for staff and equipment, excluding the subsidy, would be provided to GOI on standard terms and to the States in accordance with established GOI procedures for development assistance to States. FFDA staff and equipment requirements would be based on an average norm of about 100 ha of fish pond area to be served by each fisheries extension worker. This norm wou-ld be  - 13 - modified by project States according to local conditions, including geograph- ical location, ownership patterns for fish ponds and fish pond density. FFDAs would also organize short fish farmer training programs to give practical training on improved fish culture techniques. Under the current FFDA pattern, a deputation allowance of up to 20% is provided for personriel assigned to FFDAs, and this pattern would be continued under the project. FFDAs would be under the overall direction of the State Director of Fisheries and would assume complete responsibility for fisheries extension work in the project areas. Fish Pond Credit 2.11 The project would provide credit through participating banks (PBs) re- financed by ARDC to individual fish farmers, groups or cooperatives to finance investments in fish pond improvements and first year cash inputs. Fish pond improvement would include earth work for levelling, deepening and shaping the fish ponds as needed, inlet and outlet structures, and bamboo screens. First year cash inputs to be financed would generally include fingerlings, oil cake and fertilizers. Improvements and inputs would be financed together as a minimum package loan of up to seven years including a grace period of up to two year. FFDAs would assist borrowers in applying for loans, and where neces- sary to obtain fish pond improvement loans, would assist borrowers in obtaining leases for government-owned ponds of at least 10 years. Project States would determine the specific norms for selection of lease-holders considering both project promotion requirements and equity, but in general lease-holders would be members of the communities which have traditionally engaged in fishing and would fit the Small Farmer Development Agency definition of a small or marginal farmer. To help promote improved fish culture practices and to assist small fishermen, FFDAs would also provide to selected borrowers, a subsidy of up to 25% for fish pond improvements plus inputs, which would be channelled through PBs and disbursed in proportion to the loan. Low-income borrowers selected to receive the subsidy would be chosen on the basis of procedures determined by each State government, generally following the pattern of the Small Farmer Development Agency. All borrowers would be pond owners, or operators with a pond under a lease of at least 10 years length with specified terms during the lease period which would ensure adequate incentives to the fish farmer. PBs would disburse progress payments to the borrower for fish pond improvements, and directly to suppliers for first year cash inputs when practicable. PBs in conjunction with FFDAs would certify actual work completed and delivery of inputs financed. Earthworks would be executed by local labor contracted by the fish pond operator. Approximately 100,000 fish ponds comprising 117,000 ha would be improved in the project area. Fish ponds included in the project would generally be perennial ponds. About 75% of the fish farmers in the project area are expected to seek credit for fish pond improvement and inputs from institutional sources. Training Centers for Fisheries Extension 2.12 The project would finance training centers to train extension workers for FFDAs. New training centers would be established in West Bengal, Bihar and Uttar Pradesh, while in Madhya Pradesh the existing training center at Raipur would be strengthened. Orissa would not require a training center because of the new composite fish culture substation of CIFRI which is being  - 14 - established at Dhauli under the sponsorship of the Indian Council of Agricul- tural Research. The substation at Dhauli should be completed by the end of 1980, and along with the existing State training center at Koshala Ganga near Dhauli, would provide training as needed in Orissa. Training centers would train primarily extension workers in fish pond culture, providing both basic and refresher courses and practical applications of fish culture and exten- sion principles. Interested farmer-demonstrators would also be trained as needed. Training center investments would include a main building for class- rooms and offices, quarters for staff and trainees, a guest hostel, vehicles, audio visual equipment, extension kits and laboratory equipment. State Fish- ery Departments will appoint suitable qualified staff and operate the training centers, which will be established by December 31, 1981 during the first two years of the project, and assurances to that effect were given at negotiations. Technical Assistance 2.13 Hatchery Engineer and Hatchery Management Specialist. Technical assistance under the project would provide for a hatchery engineer consultant and a hatchery management specialist. To date, most fish hatchery operations in India have been done on an experimental basis and on a very limited scale, although commercial fish hatcheries are common in other Asian countries such as China, Japan and Taiwan. The hatchery engineer would be an individual with extensive experience in the practical design and construction of carp hatcheries of the general type envisaged for the project. He would be employed by GOI and would assist all project States during the early stages of site selection, detailed hatchery design and development and adapting of designs to local conditions and sites. He would also review hatchery tender documents, speci- fications and bid evaluations, and help supervise construction of the hatch- eries, particularly the first hatcheries in each State, to ensure that hatchery design and construction is cost-effective and operationally sound. During the project period, he would be available at the request of project States or GOI for consultation on hatchery construction problems which may arise during the course of implementation. The hatchery management specialist would be an individual with extensive experience in commercial fish hatchery operations. He would help train hatchery operating staff for the first one or two hatcheries in each state prior to their completion, and he would assist with break-in operations of these early hatcheries. He would be employed by GOI and would be available as needed for consultation on special operational problems during the project period at the request of the project States. Each consultant would be available during the project period for a total of about nine man-months on an intermittent basis and would be internationally recruited at an estimated cost of about US$8,000 per man-month, including subsistence and travel. 2.14 Project Preparation. The project also includes project preparation for a possible reservoir management project. Composite fish culture based on high quality carp fingerlings is a proven technology suitable for exploit- ing India's fish pond resources of some 1.6 million ha. However, an addi- tional 2.7 million ha of small reservoir and lake resources also exist, for which no technology for substantially raising yields has yet been proven. Under the project, a number of small reservoirs which could be controlled for  - 15 - aquacultural purposes would be selected and a 5 ha carp seed hatchery con- structed. Predatory fish would be eliminated and the reservoirs sto(ke.1 4ith high quality carp fingerlings. Fingerlinigs, inputs and outputs would be scientifically monitored to determine the optimum stocking levels and to provide the basic technical and cost-benefit data needed to determine the technical and economic feasibility of a possible reservoir management project. Hatchery and reservoir management operations and data collection would be undertaken by the Department of Fisheries in the State concerned under tthe supervision of GOI. If successful, these operations would provide the basis for compiling a preparation report by GOI in conjunction with the relevant Department of Fisheries in the State (not one of the project States) where the hatchery and reservoir project is located. 2.15 Marketing Study. An all-India fish marketing study is currently underway at the Indian Institute of Management at Ahmedabad, financed under the ongoing Gujarat Fisheries Project (Cr 695-IN, Ln 1394-IN). That study focuses on marine fish marketing, and under this project additional support would be provided to expand the study to cover inland fish marketing. The expanded study will collect data on and analyze both the current and expected domestic market situation for inland fish, and the facilities, structure, eco- nomics and channels of the inland fish marketing system in India, particularly in the project area. The study would be completed during the project period and the results integrated with the ongoing stuidy of marine fish marketing. III. PROJECT COSTS, FINANCING, IMPLEMENTATION AND DISBURSEMENTS Project Cost Estimates 3.01 Estimated project costs including duties and taxes would total Rs 350.5 million (US$40.8 million). Detailed cost estimates, including duties and taxes estimated at Rs 9.7 million (US$1.1 million), are given in Annex 2 and summarized below:  - 16 - Rs millions ----- ---- US$ million ---- % of Local Foreign Total Local Foreign Total Total Hatchery Credit West Bengal 26.3 1.0 27.2 3.1 0.1 3.2 8 Bihar 16.5 0.6 17.1 1.9 0.1 2.0 5 Orissa 12.2 0.5 12.7 1.4 0.1 1.5 4 Madhya Pradesh 13.6 0.5 14.1 1.5 0.1 1.6 4 Uttar Pradesh 10.5 0.4 10.9 1.2 - /a 1.3 3 Sub-total 79.1 3.0 82.0 9.2 0.3 9.5 23 Hatchery Roads West Bengal 11.9 0.5 12.4 1.4 0.1 1.4 3 Bihar 5.9 0.2 6.1 0.7 - /a 0.7 2 Orissa 3.9 0.2 4.1 0.5 - Ia 0.5 1 Madhya Pradesh 3.9 0.2 4.1 0.5 - /a 0.5 1 Uttar Pradesh 3.9 0.2 4.1 0.5 - /a 0.5 1 Sub-total 29.6 1.2 30.8 3.5 0.1 3.6 9 FFDAs West Bengal 8.6 0.4 9.0 1.0 0.1 1.1 3 Bihar 9.0 0.4 9.4 1.0 0.1 1.1 3 Orissa 4.5 0.2 4.7 0.5 - /a 0.5 1 Madhya Pradesh 5.9 0.3 6.2 0.7 - /a 0.7 2 Uttar Pradesh 8.0 0.3 8.3 0.9 0.1 1.0 2 Sub-total 36.0 1.6 37.7 4.1 0.3 4.4 11 Fish Pond Credit West Bengal 35.2 - 35.2 4.1 - 4.1 10 Bihar 15.1 - 15.1 1.8 - 1.8 4 Orissa 11.5 - 11.5 1.3 - 1.3 3 Madhya Pradesh 10.0 - 10.0 1.2 - 1.2 3 Uttar Pradesh 7.1 - 7.1 0.8 - 0.8 2 Sub-total 78.8 - 78.8 9.2 - 9.2 22 Training Centers West Bengal 3.4 0.2 3.6 0.4 - /a 0.4 1 Bihar 3.4 0.2 3.6 0.4 - Ia 0.4 1 Orissa - - - - - Ia - - Madhya Pradesh 1.6 0.1 1.7 0.2 - Ia 0.2 - /a Uttar Pradesh 3.4 0.2 3.6 0.4 - Ta 0.4 1 Sub-total 11.9 0.6 12.6 1.4 0.1 1.5 3 Technical Assistance Hatchery Engineer - 0.6 0.6 - 0.1 0.1 - /a Hatchery Manager - 0.6 0.6 - 0.1 0.1 - /a Project Preparation 1.8 - 1.9 0.2 - 0.2 - Ia Marketing Study 1.8 - 1.8 0.2 - 0.2 - /a Sub-total 3.6 1.3 4.9 0.4 0.2 0.6 1 Base Cost Estimate 239.2 7.7 246.9 27.8 1.0 28.8 70 Physical Contingencies 27.0 0.4 27.4 3.2 - 3.2 8 Expected Price Increases 73.6 2.5 76.1 8.5 0.3 8.8 22 Total Project Cost 339.8 10.7 350.5 39.5 1.3 40.8 100 /a Less than 0.05.  - 17 - 3.02 Cost estimates are based on January 1979 prices. A physical contin- gency rate of 20% has been applied to the civil works components of hatcheries and approach roads; a 15% physical contingency rate was used on civil works for fish pond improvement and training centers. Annual expected price increase rates used in estimating total project costs were 7% for civil works and 6% for equipment during the project period. Expected price increases during the project period total about 27.7% of total project cost for both local and foreign components of cost. 3.03 Costs for Fish Hatchery Models. Carp hatcheries are the most complex component of the proposed project. Cost estimates for the 10 ha and 25 ha model hatcheries in the project area and for the 5 ha model under tech- nical assistance are detailed in Annex 2, Tables 4, 5 and 6 and summarized below: --- Hatchery Models ------- 25 Ha 10 Ha 5 ha (Rs '000) Civil Works Earthwork 1,737 878 524 Watergates 386 235 156 Indoor Hatchery 94 67 49 Water Supply 393 208 146 Buildings 484 322 197 Engineering 309 171 107 Sub-total 3,403 1,881 1,179 Equipment 231 188 124 Land 330 144 78 Total Base Cost 3,964 2,213 1,381 Estimated water supply costs in Madhya Pradesh would include an additional Rs 340,000 for the 25 ha hatcheries and Rs 331,000 for the 10 ha hatcheries to provide water supplies from surface water sources, including construction of a channel averaging 3 km in length for each hatchery. 3.04 State-owned corporations in project States would operate project hatcheries, except for the 5 ha hatchery under technical assistance which would be operated by the Fisheries Department of the selected State. The estimated annual operating costs for project hatcheries at full development are detailed in Annex 3, Tables 1 and 2 and summarized below: 25 Ha 10 Ha (Rs '000) Management, Staff and Labor 144 114 Materials 58 23 Operation and Maintenance 99 70 Travel, Interest and Miscellaneous 49 31 Total 350 238  - 18 - 3.05 Costs for Project Fish Pond Credit. Estimated costs for fish pond improvements and first year cash inputs total Rs 722 million for the total project area of 117,000 ha. Since about 25% of the fish farmers involved in the project are expected to finance improvements and inputs from their own or non-institutional resources, investment requirements for fish farmers needing credit would total about Rs 541 million. The amount of fish pond investment included in the project, Rs 108 million, is calculated to provide a minimum level of base demand for project fingerlings and would meet only about 20% of the estimated credit demand. Project lending terms would be the same as exist- ing ARDC terms for similar types of diversified lending, and ARDC currently has available substantial resources earmarked for the subsector. Assurances were given at negotiations that after project funds for fish pond credit are fully utilized, ARDC would give priority to financing fish pond credit requirements in the project area from the IDA-supported general lines of credit. Financing 3.06 Estimated shares in the financing of project costs are as follows: Components Borrowers PB's ARDC GOI/States IDA Total (Rs millions) Hatcheries 36.3 16.9 30.5 - 37.3 121.0 Approach Roads - - - 10.0 36.5 46.5 Fish Pond Credit 16.9 19.3 34.7 - 42.4 113.3 FPDAs - - - 10.6 38.7 49.3 Training Centers - - - 3.3 12.2 15.5 Technical Assistance - - - 4.9 4.9 Total 53.2 36.2 65.2 23.9 172.0 350.5 (percent) (15%) (10%) (19%) (7%) (49%) (100%) 3.07 The proposed IDA credit of US$20.0 million would finance about 50% of the estimated total project cost net of duties and taxes. The credit would cover the estimated foreign exchange costs of US$1.3 million and about 49% of local costs. Lending Terms and Conditions 3.08 Subvention. IDA funds for hatchery approach roads (US$4.2 million), 717Dks (U3$4.5 million), extension training centers (US$1.4 million), and tech- nical assistance (US$0.6 million) would be provided by GOI to the project States together with GOI's contribution out of its own resources, in accordance with established GOI procedures for development assistance to the project States. 3.09 Subloans under the Credit Program. IDA funds for subloans to Fish Seed Development Corporations (FSDCs) for fish hatcheries (US$4.3 million), and to fish pond operators for fish pond improvements and first year cash inputs (US$4.9 million) would be on-lent by GOI to ARDC. Details of credit  - 19 - arrangements would be generally consistent with those applicable to other Bank/IDA financed credit programs administered by ARDC and would include: qualifying conditions for banks to operate as project participating banks (PBs); the requirement that FSDCs, PBs, and ARDC maintain separate accounts for the project; insurance arrangements; debt rescheduling procedures; and ARDC's obligation to ensure that financial commitments for hatcheries are made by FSDCs on the basis of IDA procurement guidelines and project provi- sions. Actions needed by project States to ensure full utilization of project and ARDC funds to meet credit demand for project hatcheries and fish pond improvements and inputs would be discussed at negotiations. 3.10 The contributions required from different categories of borrowers for various investment activities, the fractions to be refinanced and the annual interest rates chargeable would be in accordance with the following schedule: