Announcement of IDA Approves One Hundred Million Forty Thousand Credit to India for Medium Irrigation Project in Madhya Pradesh State on March 19, 1981

! . ,,,,,. • • FOR IMMEDIATE RELEASE / .world Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 IDA NEWS RELEASE NO. 81/51 March 19, 1981 IDA APPROVES SOR 112.6 MILLION CREDIT TO IN~IA FOR MEDIUM IRRIGATION PROJECT IN. MADHYA PRADESH-SiATE The International Development Association (IDA) today announced approval of an SDR 112.6 million credit ($140 million) for a composite medium irrigation project in Madhya Pradesh State, India. IDA is the World Bank's affiliate for concessionary lending. -· Madhya Pradesh is India's largest state and, although richly endowed in natural resources, is one of the poorest states in India. Utilizing water re- sources of numerous small rivers located throughout Madhya Pradesh, the project will provide irrigation to areas where large-scale development is not feasible. This will involve construction of 25 to 30 medium irrigation projects with a combined service area of about 107,000 hectares over a period of five years, 1981 through 1986. Each of the project areas will be composed of a storage dam with spillway, a fully lined canal network, unlined field channels to the operat- ing unit, and a drainage network connecting to natural drains . • The project also includes provision of equipment to improve hydrological data base for the planning of future major and medium irrigation projects; monitor- ing and evaluation studies; a water management component; training of project management staff; technical services for the planning and design of the di~tribution systems; and demonstration farms for irrigated agriculture. The IDA credit, in assisting the expansion of the area under irrigation, will increase the production of foodgrains, oilseeds, spices, long ·staple cotton; and garden crops, and will provide additional year-round employment to landless laborers and small farmers. Net farm incomes are also expected to rise substantially for the average farm, 420% of what they would be without the project. The use of fertilizers and pesticides is not expected to have a significant environmental impact, since the project areas are relatively small and are spread throughout the state. Precautions have been taken to minimize the risk of malaria and other water-related diseases in the area. The IDA credit is for 50 years, including 10 years of graces The credit carries no interest but bears a service charge of 3/4 of 1% per annum to cover IDA's administrative expenses. NOTE: IDA credits are denominated in SDRs (Special Drawing Rights), which are valued on the basis of a "basket" of currencies. The U.S. do11ar equi- • valent of the SOR amount of the IDA credit reflects the exchange rates existing at the time of negotiation of the credit. FORM Nq. 1121 (5-76) T ECHN I CAL DA T A PROJECT: COUNTRY: TOTAL COST: Madhya Pradesh Medium Irrigation India $232.1 million • rnA FI NANC I NG : SOR 112.6 million ($140 million), standard IDA terms OTHER FINANCING: Government of India, $92.1 million IMPLEMENTING ORGANIZATION: Irrigation Department Government of Madhya Pradesh Chief Secretary Vallabh Bhavan, Bhopal, India 462006 PROJECT DESCRIPTION: The project will finance the construction, within a fiye-year period, of 25 to 30 medium irrigation projects, with a com- bined service area of about 107,000 hectares. The project also includes: a) provision of equipment to improve the hydrological data base for the planning of future major and medium irrigation projects; b) monitoring and eva1uation studies; c) .a water management compon~~ d) training of management staff; e) technical services for the planning and design o f t ~ distribution system; and f) demonstration farms for irrigated agriculture. . PROCUREMENT: As the dvil works will be labor-intensive and relatively small and scattered they will be carried out by indigenous contrac- tors. The dams and main canals will be packaged into contract parcels so as to attract competition from the larger domestic contractors, yet will allow bidding for individual contracts by small contractors. Tendering and bid evaluation will be based on standard competitive bidding procedures and guidelines recently developed by the Central Water Commission and approved by IDA. Some of the smaller works, not to exceed 40% of the total civiJ works, will be procured under small unit price or percentage rate contracts. Equip- ment and vehicles will be procured on the basis of local competitive bidding acceptable to IDA in order to benefit from existing servicing and spare part supply facilities. ECONOMIC RATE OF RETURN: ESTIMATED COMPLETION DATE: 18% 1986 - 0 - •