Announcement of IDA Assists Irrigation and Cashewnut Production in India on May 1, 1980

FOR IMMEDIATE RELEASE eWorldBank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. •Telephone: (202) 477-1234 IDA NEWS RELEASE NO. 80/56 May 1, 1980 IDA ASSISTS IRRIGATION AND CASHEWNUT PRODUCTION IN INDIA The International Development Association (IDA), an affiliate of the World Bank, today announced the approval of two credits totaling $197 mill ion to help finance development of irrigation in India's Gujarat State and of increasing cashewnut production in Andhra Pradesh, Karnataka, Kerala and Orissa states. Second Gujarat Irrigation A c~edit of $175 mill ion wi 11 be devoted to a $360 mill ion project designed to increase irrigation in the State of Gujarat and to achieve better use of scarce surface water resources and to ensure a reliable and equitable supply to individual farmers. It includes the continuation of construction • of three major irrigation schemes and the improvement of village-to-market roads networks in their command areas; modernization of parts of Gujarat's largest irrigation scheme, the Ukai-Kakrapar project; and operational and management improvements. At full development, the project will help increase annual foodgrain production by 200,000 tons and other crops by about 200,000 tons. Cashewnut Project The other credit of $22 mill ion will help finance a $45.7 mill ion project to improve cashewnut production in the states of Andhra Pradesh, Karnataka, Kerala and Orissa. It includes new plantings on 53,775 hectares and improvements on 7,500 hectares. The project will also strengthen cashew research and implement a training program. At full development, the project will help increase annu2l production of about 53,000 tons of raw nuts valued at $51 mill ion (in terms of 1979 prices). The income of about 40,000 small- holders, the majority of whom are subsistence farmers, will be increased. The project will also generate additional employment opportunities in the rural sector and will secure about 35,000 labor-years of employment in the cashew processing industry. Both credits to India are for 50 years. They are interest free, except for a service charge of 3/4 of 1% per annum to meet IDA's administra- tive costs . • NOTE: Money figures are expressed in U.S. dollar equivalents. FORM NO. 1121 (5·-76) T E C HN I CAL DA T A PROJECT: COUNTRY: TOTAL COST: Second Gujarat Irrigation India $360 million • IDA FINANCING: $175 million, standard IDA terms OTHER FINANCING: Government of Gujarat IMPLEMENTING ORGANIZATION: Irrigation Department Government of Gujarat Gandhinagar Gujarat, India PROJECT DESCRIPTION: It consists of a five-year slice (April 1980-85) of part of Gujarat's investment program for irrigation. It includes the continuation of construction of three major irrigation schemes and improving the • village-to-market roads network in their command areas; modernization of parts of Gujarat's largest existing irrigation scheme (Ukai-Kakrapar); operational and management improvements of irrigation projects; establishment of an institute for training of land development and water management specialists; and project monitoring and evaluation. PROCUREMENT: The project includes about $174 million for civi 1 works. Of these, contracts totaling $40 million for dams and main canals in excess of $6 million per contract would be let on the basis of inter- national competitive bidding (ICB). For bid evaluation a preference of 7.5% will be granted to Indian contractors. Equipment valued at $20 million ··ill be procured under ICB. A preference 1 imited to 15% of the c. i .f. price or prevai 1,,19 customs duty if lower will be extended to local manufacturers. ECONOMIC RATE OF RETURN: 18% • ESTIMATED COMPLETION DATE: 1986 - 0 - FORM NO. 1121 (5-76) T ECH N I CA L DAT A • PROJECT: COUNTRY: TOTAL COST: Cashewnut India $45.7 million IDA FINANCING: $22 million, standard IDA terms OTHER FINANCING: Government of India; Governments of Kerala; Karnataka; Andhra Pradesh and Orissa; Agricultural Refinance and Development Corporation; participating banks and growers IMPLEMENTING ORGANIZATIONS: Department of Agriculture Government of Kerala . Trivandrum, · Ker a 1a , I nd i a . Department of Agriculture Government O( Andhra Pradesh Hyderabad, India. Horticultural Department • Government of Karnataka Bangalore, India . Soil Conservation Department Government of Orissa Bhubaneswa r Orissa, India. PROJECT DESCRIPTION: It wi 11 help finance a cashew production program in the states of Kerala, Karnataka, Andhra Pradesh and Orissa, partly by smallholders and partly by ~tate ~cvernment corporations. It includes new plantings on 53,775 hectares and improvements on 7,500 ha, and strengthening cashew de- velopment units in each state and implementing a program of research and training. PROCUREMENT: Civil works ($4.3 million) will be carried out over scat- tered sites in four states over four years. Contracts for such works will not attract foreign bidders. Hence these will be awarded on the basis of local competitive bidding. About 30 motor vehicles ($0.S million) and equip- ment will also be procured through local competitive bidding. • ECONOMIC RATE OF RETURN: ESTIMATED COMPLETION DATE: 25% 1984 - 0 -