Document of The World Bank FOR OFFICIAL USE ONLY Report No. 15527 IMPLEMENTATION COMPLETION REPORT TURKEY IGDIR-AKSU-EREGLI-ERCIS (IAEE) IRRIGATION PROJECT LOAN 2433-TU March 28, 1996 Agriculture and Environment Operations Division Country Department I Europe and Central Asia Region 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 EOUIVALENTS Currency Unit = Turkish Lira (TL) Value of US$ 1.00 in TL 1987 = 1,021 1988 = 1,815 1989 = 2,314 1990 = 2,930 1991 = 5,080 1992 = 8,564 1993 = 14,473 1994 = 38,726 March 1995 US$ 1.00 TL 42,000 TL 1,000 = US$ 0.0238 TL 1,000,000 = US$ 23.8 WEIGHTS AND MEASURES I kilogram (kg) = 2.20 pounds I metric ton 1,000 kilograms, 0.98 long ton I hectare (ha) = 2.47 acres I decare = 0.1 ha I square kilometre (kiM2) = 0.386 square mile FISCAL YEAR OF BORROWER Government of Turkey January I to December 31 ABBREVIATIONS AND ACRONYMS AIA Actual Irrigated Area DOFDP Drainage and On-Farm Development Project DSI General Directorate of State Hydraulic Works FAO Food and Agriculture Organization of the UN GDAPD General Directorate of Agricultural Production and Development GDRS General Directorate of Rural Services GOT Government of Turkey GIA Gross Irrigable Area IAEE Igdir-Aksu-Eregli-Ercis IR Irrigation Ratio I&D Irrigation and Drainage LB Left Bank MAVA Ministry of Agriculture and Village Affairs MPWS Ministry of Public Works and Settlement NIA Net Irrigable Area OFD On-Farm Developments OFWM On-Farm Water Management O&M Operation and Maintenance RB Right Bank SAR Staff Appraisal Report SMS Subject Matter Specialists TCZB Agricultural Bank of Turkey VGC Village Group Centre WUO Water Users Organization FOR OFFICIAL USE ONLY IMPLEMENTATION COMPLETION REPORT TURKEY IGDIR-AKSU-EREGLI-ERCIS (IAEE) IRRIGATION PROJECT LOAN 2433-TU Table of Contents Preface Evaluation Summary . ....................................... i-iv PART I: PROJECT IMPLEMENTATION ASSESSMENT ............... 1 A. Statement/Evaluation of Objectives ............................ 1 B. Achievement of Objectives ........... ...................... 1 Igdir Subproject ....................................... 2 Aksu Subproject ....................................... 3 Eregli Subproject . .................................... 4 Ercis Subproject ....................................... 5 Equipment and Vehicles ........... ...................... 6 Extension .......................................... 6 Training .......................................... 6 Irrigation Investment Master Plan (IMP) Study ................... 7 Agricultural Credit ..................................... 7 Economic and Financial Objectives .......................... 7 C. Major Factors Affecting the Project ............................ 8 Factors Not Generally Subject to Government Control ............... 8 Factors GeneraUy Subject to Government Control ................. 9 Factors Generally Subject to Implementing Agency Control .... ....... 9 D. Project Sustainability ..................... 9 E. Bank Performance ....................................... 11 F. Borrower's Performance . .................................. 12 G. Assessment of Outcome .............. .. ................... 12 H. Future Operation ....................................... 13 I. Key Lessons Learnt . ..................................... 13 dWs 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. Table of Contents (cont'd) Table 1 Summary of Assessments ............................ 14 Table 2: Related Bank Loans/Credits .......................... 15 Table 3: Project Timetable ................................ 16 Table 4: Loan/Credit Disbursements: Cumulative Estimated and Actual ..... 17 Table 5: Key Indicators for Project Implementation ............... 18-20 Table 6: Key Indicators for Project Operation .................... 21 Table 7: Studies Included in Project .......................... 21 Table 8A: Project Costs ................................... 22 Table 8B: Project Financing ................................ 22 Table 9: Economic Costs and Benefits ......................... 23 Table 10: Status of Legal Covenants ......................... 24-27 Table 11: Compliance with Operational Manual Statements ............. 28 Table 12: Bank Resources: Staff Inputs ......................... 28 Table 13: Bank Resources: Missions .......................... 29 APPENDICES A. Mission's Aide Memoire B. Borrower's Contribution to the ICR C. Economic Re-evaluation D. Borrower's Comments on Draft ICR E. Maps I to 5 IMPLEMENTATION COMPLETION REPORT TURKEY IGDIR-AKSU-EREGLI-ERCIS (IAEE) IRRIGATION PROJECT Preface This is the Implementation Completion Report (ICR) for the IAEE Irrigation Project in Turkey, for which Loan 2433-TU in the amount of US$115.3 million equivalent was approved on June 5, 1984 and made effective on October 29, 1984. The loan was closed on June 30, 1992, three years after the original closing date of June 30, 1989. Final disbursement took place on August 18, 1992. Due to discrepancies in the Special Account, the undisbursed balance of US$4.9 million was cancelled in two steps: US$4.8 million on October 31, 1992 and US$0.1 million on September 29, 1994. The loan account was finally closed on September 30, 1994. Funding from Loan 2663-TU, amounting to US$56.9 million, was provided to complete the balance of the works remaining at loan closing. This ICR was prepared by a mission from the FAO/World Bank Cooperative Programme1 on behalf of the Agriculture and Environment Operations Division, Country Department I of the Europe and Central Asia Region of the World Bank. Preparation of this ICR started with the mission's visit to Turkey from March 27 to April 12, 1995. The report is based on material gathered from the project files, supervision reports, as well as on findings from field investigations and discussions with Bank and Government of Turkey staff associated with the project. The Borrower contributed to the preparation of the ICR by arranging field visits and meetings, providing implementation data, and providing substantive comments during the preparation of the mission's Aide Memoire. 1/ Messrs. R. Suppa (Economist, Mission Leader), H. Laeyendecker (Irrigation Engineer, Consultant, part-time), and R. Hasan (Irrigation Engineer, Consultant). e*.- IMPLEMENTATION COMPLETION REPORT TURKEY IGDIR-AKSU-EREGLI-ERCIS (IAEE) IRRIGATION PROJECT (Loan 2433-TU) Evaluation Summary Introduction i. The LkEE project was appraised in September 1982 and approved by the Bank's Board on June 5, 1984. The project was estimated to cost US$292.0 million towards which the Bank provided a loan of US$115.3 million equivalent. The Borrower was the Republic of Turkey. The main implementing agencies were the General Directorate of State Hydraulic Works (DSI), the General Directorate of Rural Services (GDRS) and the General Directorate of Agricultural Production and Development (GDAPD). The original closing date was June 30, 1989, about five years after the date of effectiveness of October 29, 1984. The closing date was exteinded three times, one year at a time, to June 30, 1992. To help Turkey overcome the negative balance of payments caused by the Gulf crisis, the disbursement percentages were increased (on average from 50% to 80%) in FY91. An amount of US$110.4 million, or 96% of the total, was disbursed as of August 18, 1992. Out of the undisbursed balance of US$4.9 million, US$4.8 million was cancelled on October 31, 1992. The remaining US$0.1 million was only cancelled on September 29, 1994, after reconciliation of discrepancies in the project special account, which took time. The loan account was finally closed on September 30, 1994. Beginning October 1992, with Bank agreement to the Borrower's request, the completion of remaining works was funded under the Bank-financed Drainage and On-farm Development (DOFD) project (Loan 2663-TU). Disbursement under Loan 2663 amounted to US$56.9 million. Total Bank disbursement for the IAEE works thus amounted to US$167.3 million, against which the actual implementation cost was US$270.3 million (US$189.1 million till loan closing and US$81.2 million for completion of balance of the works). ii. The main objectives of the project were to increase agricultural production and incomes, expand rural employment opportunities, and to prepare a rational long-term investment program for irrigation development in Turkey. These objectives were to be achieved by implementing four subprojects for completing the infrastructure in the area remaining to be irrigated and upgrading the works completed earlier at four existing irrigation schemes (Igdir, Aksu, Eregli and Ercis), benefiting about 25,400 farm families. The infrastructure component of the project included: (i) construction of additional irrigation and drainage (I&D) systems; (ii) rehabilitation and improvement of existing I&D systems; (iii) provision of on-farm developments (OFD) for land levelling, surface and sub-surface drainage, correction of salinity and alkalinity problems and construction or upgrading of - ii - feeder roads. The project also included an extension component as well as the preparation of an Irrigation Investment Master Plan (IMP). The IMP preparation was subsequently, with Bank concurrence, transferred to and implemented under the DOFD project (loan 2663-TU). Implementation Experience and Results iii. Project Preparation and Appraisal: The project was designed to complete work in four existing large irrigation schemes, covering a total of about 119,000 ha gross (112,700 ha net). The project was developed on the basis of information provided on individual suDprojects' feasibility reports prepared by DSI; it included constructing new and rehabilitating existing irrigation and drainage systems, promoting on-farm development works, strengthening extension services, and establishing a program of institutional development. Based on the implementing agencies further survey of the project sites and cost scrutiny after Board approval, the project scope and cost were modified in mid-1984. Under the modified situation, the project scope was enlarged to a gross area of 135,506 ha and a net area of 125,041; details are shown in Appendix C, Table 1. iv. Implementation record: The progress on the implementation of works was affected by various adverse factors. Problems arose in the selection and award of works, including the cancellation of contracts and replacement of one main contractor at Igdir. Unexpected geotechnical problems were encountered at Ercis. Delays also occurred in procurement of machinery and equipment for land reclamation. By the end of March 1995, about 20% of the works in Part IV of Igdir subproject and the entire OFD at Ercis still remained to be completed. Both DSI, which implements the irrigation component, and GDRS, which implements the OFD component, have plans to complete the remaining works at Igdir and Ercis by the end of 1996 and 1997 respectively. Despite these problems, project implementation can be considered satisfactory in terms of achieving the appraisal's physical targets. Up to Loan closing date, under the four subprojects, the gross irrigated area reached 135,506 ha (14% more than appraisal target), and the net irrigated area reached 103,200 ha (about 8% lower than appraisal target). Other project components such as extension, training and procurement of equipment and vehicles were implemented satisfactorily, although delays were experienced in the selection of machinery to lay drainage pipes. v. Project results: At loan closing, the net irrigable area (NIA) and the actual irrigated area (AIA) under the four subprojects were 103,200 ha and 63,700 ha respectively. In 1983, without project, the corresponding figures were 81,500 ha and 47,400 ha. The project thus achieved (by loan closing) an increase of 27% in NIA and, more significant, an increase of 34% in AIA. The completion of the remaining works (after loan closing) under GOT funding and disbursements under loan 2663-TU (which closed on June 30, 1995) will raise NIA to 125,000 ha; but AIA (due to time lag in full development of irrigation) might reach about 90,000 ha only, still an increase of about 90% over the 'without project' situation. As regards the individual subprojects, Ercis has achieved the maximum project impact, followed by Igdir. The performance at Eregli, where only OFD works were carried out, is currently affected by water shortage, and will improve significantly when sufficient ground water - iii - becomes available to supplement surface water for the entire NIA of about 32,300 ha. The development of benefits at Aksu, where less than 50% of the irrigation infrastructure is being used because of socioeconomic changes (para 9), will remain uncertain till economically viable alternatives are found to use the available infrastructure. The training component was implemented satisfactorily with 60 DSI staff and 35 GDRS staff having participated in two- to four-week study and training courses abroad. The extension component was successfully implemented by GDAPD and achieved all its targets for training and strengthening with buildings, equipment and vehicles. Economic returns, although generally satisfactory, are below Staff Appraisal Report (SAR) estimates. The project as a whole generated an Economic Rate of Return of about 10% (SAR 20.3%). Overall, about 28,000 farm families have benefitted under the project, well above the appraisal estimate of 25,400. This has probably helped in reducing the migration of people from rural areas to cities. vi. Key factors affecting project achievements: The most important factors which affected implementation were: (i) at Ercis, inadequate site investigation at Kockopru dam (not funded under the project), which supplies water to the subproject; (ii) major changes in socioeconomic conditions at Aksu, located near a center of major growth of tourism; (iii) overestimation of water availability at Eregli; (iv) over-optimistic appraisal of project implementation capacities of DSI and GDRS; and (v) lack of coordination between the three implementing agencies -- DSI, GDRS and the GDAPD. Other factors which affected project progress were: (a) delays in obtaining agreement with Iran about the use of international river waters for the Igdir subproject; (b) delays at the start of the project in arriving at a mutually acceptable LCB document by Bank and DSI, resulting in late award of local contracts; (c) rescinding of the main contractor's contract and replacement by two new contractors at Igdir, the biggest of the four subprojects; and (d) late arrival of OFD machinery and equipment. vii. Sustainability: The project's sustainability is uncertain. Although the farmers accepted and welcomed the O&M transfer, the sustainability will depend on how far the new Water User Organizations (WUOs) will succeed in scheme management, including O&M, monitoring of water use, and O&M cost recovery (the present average recovery rate of 63% at three subprojects is higher than the national average of 57%). Eregli is facing scarcity of water, however, initiatives have been taken to mitigate this problem through ground water development. The sustainability of Aksu subproject, however, is in question due to a variety of socioeconomic factors, irrigated agriculture is being abandoned, leaving over 50% of the irrigation infrastructure unused (para 9). The project sustainability seems to be improving in view of DSI strong commitment to the transfer of I&D schemes management to the WUOs, operation and maintenance of the irrigation would become the responsibility of the water users, except for the dams and the main canals of bigger schemes. viii. Bank and Borrower perfornance: The Bank's performance during project preparation and appraisal was poor. This is reflected in an overoptimistic implementation schedule, failure to address important institutional issues and failure to address the international waters problems which postponed Board presentation by one year. It was - iv - satisfactory in supervision, disbursement and in its liaison with the Borrower. The performance of the Borrower (DSI) was acceptable on the basis of the overall physical implementation despite several problems. However, closer coordination between the implementing agencies would have expedited project completion. Also, DSI and GDRS over-estimated their implementing capacities. Key Lemons Learned ix. The key lessons learnt are: - investment projects that are heavily focused on physical components, fail to address the root causes of the problems facing the sector. Greater focus on institutional and policy issues when these stand in the way of efficiency is warranted: - the use (now mandatory) of country and sector-specific disbursement profiles would result in a more realistic implementation period for any irrigation project; - the availability and reliability of water supply has to be critically assessed at appraisal and the command area sized acc&rdingly, to avoid situations similar to Eregli; - delays in project implementation can be curtailed by closer cooperation and coordination between participating agencies, but this requires developing appropriate arrangements during preparation; - establishment of WUOs and maldng them responsible for management, is a major positive step for assuring the sustainability of an irrigation project; - creation of a Monitoring and Evaluation (M&E) unit in DSI and expansion of its existing Environmental Unit would contribute substantially to a quality analysis of the impact and to the planning of irrigation schemes; the measurement of irrigation efficiencies is vital to assess the performance of irrigation schemes; there is need for a detailed, more formalized approach to project preparation and detailed design, implementation details, operation and maintenance plans and other mechanisms appropriate for the successful implementation of the project, including time-bound schedule of performance activities and management warning systems; in this regard the present practice of requiring Implementation Plans to be developed is a step in the right direction. IMPLEMENTATION COMPLETION REPORT TURKEY IGDIR-AKSU-EREGLI-ERCIS (AEE) IRRIGATION PROJECT LOAN 2433-TU PART I: PROJECT IMPLEMENTATION ASSESSMENT A. Statement/Evaluation of Objectives 1. The objectives of the project were to increase agricultural production and incomes, expand rural employment opportunities, and to prepare a rational long-term investment prog,am for irrigation development. These objectives were to be achieved through the construction of new and rehabilitation of the existing irrigation and drainage systems, the provision of on-farm development works, the strengthening of extension services, the establishment of a clear program of institutional development. The works were considered to be executed under the command area of four large existing irrigation schemes (Igdir, Aksu, Eregli, and Ercis) covering a total of about 119,00 ha gross (112,700 ha net) and benefiting about 25,400 farm families. The infrastructure under the subprojects included: (i) construction of additional irrigation and drainage (I&D) systems; (ii) rehabilitation and improvement of existing I&D systems; (iii) provision of on-farm development (OFD) in the form of land levelling, surface and sub-surface drainage, correction of salinity and alkalinity problems and construction or upgrading of feeder roads. The subprojects also included training of the beneficiaries and the staff and strengthening of the extension services through provision of equipment, vehicles, and buildings. An Irrigation Strategy Review component, which aimed at developing an Investment Master Plan (IMP) for irrigation was included in the project but was subsequently financed and implemented, with Bank concurrence, under the Bank-financed Drainage and On-Farm Development (DOFD) project (Ln. 2663-TU). 2. The Government of Turkey (GOT) was, at project formulation, giving emphasis to the completion of infrastructure works and rehabilitation of existing irrigation schemes and reducing the time lag in construction of on-farm works (OFD) in areas which were already served by major infrastructure. In this context, the project was relevant to the country and the sector. Although the project had ownership (DSI and GDRS) from its inception, a number of factors affected its implementation progress and achievements. B. Achievement of Objectives 3. The achievement of physical targets is considered satisfactory, despite the delays in the construction of the main irrigation and drainage infrastructure, mainly due to contractors' failure to meet construction schedules. The project had three extensions of the closing date, one year at a time. The Loan disbursement percentages for works were increased during the Gulf crisis (on average from 50% to 80%) to help Turkey overcome the negative balance of payments impact that the crisis caused. Disbursement against the Loan reached US$110.4 million, with the last payment on August 18, 1992, although some of the works were still - 2 - incomplete, specially at Igdir and Aksu subprojects. Out of the undisbursed balance of US$4.9 million, US$4.8 million was cancelled on October 31, 1992. The remaining US$0.1 million was cancelled on September 29, 1994, after a reconciliation of discrepancies in the project special account, which was inordinately delayed. The Loan account was only finally closed on September 30, 1994. Beginning October 1992, with Bank agreement to the Borrower's request, the completion of the remaining works at the two subprojects was funded under Loan 2663-TU. Disbursement under Loan 2663-TU amounted to US$56.9 million against an investment cost of US$81.2 million. Total Bank disbursement for IAEE project thus amounted to US$$167.3 million, the total implementation cost being US$270.3 million. The project was prepared on the basis of information provided on individual subproject's feasibility reports, prepared by DSI. The preparation report, however, was not based on detailed study and design of individual subprojects. Based on the implementing agencies further survey of the project sites and unit cost of work scrutiny, the project scope and cost was modified in mid-1984, after Board presentation. Under the modified situation, the project scope was enlarged to cover a gross area of 135,506 ha and a net area of 125,041 ha (details are shown in Appendix C, Table 1). 4. In 1983, without project, the net irrigable area (NIA) and the actual irrigated area (AIA) under the four schemes were 81,500 ha and 47,400 ha respectively. At loan closing, the corresponding figures were 103,200 ha and 63,700 ha -- an increase of 27% in NIA and, more importantly, 34% in AIA. After the loan closing, NIA and AIA increased further with execution of the balance works, with funding under loan 2663-TU. By 1996, when DSI and GDRS expect to complete the remaining works, NIA will reach the planned target of 125,000 ha. At the same time, AIA might reach only 90,000 ha due to the time lag between the development of irrigated crops and the completion of I&D works -- still an increase of about 90% over the 'without project' situation. As regards the outcome of the three subprojects involving major I&D works, Ercis has shown maximum project impact, followed by Igdir, where development of about 12,000 ha (Part IV) is scheduled to be completed by DSI in 1996. The development of benefits at Aksu, where less than 50% of the irrigation infrastructure is being used because of socio-economic changes in the area (para. 9), is unsatisfactory and will remain uncertain till economically viable alternatives are found to use the available facilities. The performance at Eregli, where only OFD works were carried out, is good and will improve further when irrigation water becomes available to serve the entire NIA of about 32,300 ha. The implementation of individual subprojects and other activities is described below. Igdir Subproject 5. Implementation status: Part I of the subproject (area already under irrigation in West Igdir), required only rehabilitation, which has been completed. Parts II, III and IV needed substantial improvement and upgrading, and new infrastructure. As of April 1995, the works in Parts II and III were fully implemented. The works in Part IV (new area) requiring most of the funding under DOFD, were also nearly complete. The progress achieved by GDRS on the main OFD components was 74% for sub-surface drainage, 84% for land levelling, - 3 - 100% for feeder roads, but only 20% for land reclamation, which was due to late delivery of machinery. GDRS expected to complete about 4,000 ha of gypsum treatment in 1995 and a further 4,000 ha in 1996. About 176,000 tonnes of gypsum were available in the subproject area for this purpose. Both DSI and GDRS have plans to complete the remaining I&D and OFD works from their own financial resources by 1996. Lack of adequate funds, however, could postpone their plan as during FY95 the Government provided only a fraction, less than 10%, of the actual need. 6. According to the SAR, pre-project GIA of 56,600 included 10,000 ha of government owned lands. It was part of the project's legal covenants (Table 10, section 3.05(b)), that the Government would make plans for distributing its land to the farmers in Igdir. Although some steps, such as making the General Directorate of Agrarian Reforms responsible for the distribution, have been taken, the Government has yet to privatize the land and comply with this legal covenant. 7. Project impact on irrigable area: As the project developed, NIA increased from 30,000, in the without project situation, to about 51,700 ha in 1994; however, AIA merely increased from 22,900 to about 31,000 ha, because about 8,000 still required land levelling and a further 6,000 ha remained to be treated for salinity and alkalinity problems. At full development, NIA and AIA are expected to be 66,920 ha and 63,750 ha respectively. The GIA, NA, and AIA under each part are given in Appendix C, Table 1, and shown on maps in Appendix E. Aksu Subproject 8. Implementation status: Except for the rehabilitation of 10 km of main canal, the irrigation components were fully implemented by 1992. The remaining works were completed by 1994 with funding under DOFD. The flood protection subcomponent was not implemented since the Bank agreed with DSI that the completion of the Karacaoran Dam in 1985 significantly reduced the risk of flooding from the upper Aksu basin and flood dikes and other river channel improvement works would not be necessary (Supervision Mission Report of June 1991). The land levelling component of the OFD works was revised from the SAR estimate of 17,000 ha to 5,000 ha but actual land levelling was carried out on 4,200 ha (84% of the revised target). The subsurface drainage and feeder roads were fully implemented. Cotton growers were reluctant to allow land levelling on their fields and demanded compensation for loss of crops and this was the main cause for reducing the area for land levelling. 9. Project impact on irrigable area: NIA at Aksu was 14,529 ha without project (GIA 15,457). With project, NIA has increased to 22,250 ha and GIA to 23,667 ha. The project's AIA, however, experienced reduction. In spite of its almost full completion in 1992, the project's AIA gradually reduced from its 10,552 ha, under the situation of without project, to 10,394, with project, in 1994. DSI attributed this steady decline to: (i) the demand for cotton, the dominant crop, having fallen in the area and the farmers generally - 4 - preferring rainfed to irrigated crops because of marketing problems; (ii) the number of greenhouses (units of 1,300 m3 each) in the area having increased from 700 in 1984 to 3,900 in 1994 attracting labor from the farm lands; and (iii) many young farmers takdng up jobs in the Antalya region's lucrative tourist industry in summer and some of them giving up farming altogether. DSI is unable to forecast if the socio-economic trends in the region would change in the short or long term. Also, GDAPD has observed that farmers are reluctant to adopt alternative cropping patterns, e.g. introducing rainfed wheat or winter fodder crops while waiting to go back to cotton if prices would adequately increase. However, with world market price for cotton higher than ever, these arguments make little sense. 10. It is doubtful that anybody could have anticipated at the time of appraisal the explosive growth of mass tourism in the Antalya region that started in the late 1980's. Tourism now provides well-paid work during the hot weather period when cheap labor is required for the proverbially disagreeable work in the cotton fields. Once the project in a traditional cotton growing area got underway, it was impossible for DSI to ascertain whether the decrease in cotton cultivation constituted a permanent trend rather than a short term fluctuation. The Bank supervision missions cannot be blamed either for not identifying the true socio-economic reasons until it was too late. Eregli Subproject 11. Implementation status: The subproject included only the OFD work, which was fully implemented by 1992, except for the subsurface drainage which was omitted in the final design. The Ivriz dam and appurtenant works and other irrigation infrastructure, which were under construction at the time of appraisal, continued to be implemented by DSI under their own funds, and did not form part of the subproject. 12. Project impact on irrigable area: Prior to the construction of Ivriz dam, GIA was 31,860 ha, NIA about 30,270 ha, AIA 14,000 ha. With the completion of the Ivriz dam and irrigation facilities in 1985, GIA increased to 37,649 ha, NIA to 32,294 ha and AIA to 26,004 ha. The distribution of the GIA and NIA along the Ivriz River is shown in the maps in Appendix E, and tabulated in Appendix C, Table 1. 13. The NAI and AIA are not likely to rise further due to shortage of water, in spite of Ivriz storage. With an active storage of 80 x 106 m3, a mean annual inflow of 234 x 106 m3 and a regulation ratio of 85%, the dam can irrigate 20,000-25,0000 ha, depending on the cropping pattern and the overall irrigation efficiency. In order to augment irrigation water supplies, DSI has installed 60 tubewells in the LB area and 15 tubewells (out of 40 planned) in the RB area. When all the 100 wells are in operation, yielding about 36 x 106 m3 per year, an additional area of 4,000-5,000 ha could be irrigated. With the combined supplies from the dam and the wells, a maximum of about 30,000 ha could be irrigated, for which irrigation infrastructure is available. In 1994, 160 x 106 m3 (dam 132 x 106 m3+wells 28 x - 5 - 106 m3) irrigated an area of about 25,000 ha. DSI practice for the design of the irrigation schemes is reported to assure water availability for at least 90% of NIA. 14. Apart from sinking additional wells in such a case of scarcity, it might have been useful to introduce different water saving technologies, such as (i) detailed monitoring of water use and its losses; (ii) introduction of automatic gates and night storage reservoirs to reduce operational losses; and (iii) introduction of sprinkler and localized irrigation to reduce field application losses. DSI did not explore these possibilities. The Bank missions also apparently did not suggest to DSI to pursue such an approach to mitigate the shortage problem. Ercis Subproject' 15 Layout changes: The Ercis scheme was initially designed to irrigate GIA of 7,500 ha (6,700 ha on the RB and 800 ha on the LB of the River Zilan) from the Kockopru dam (completed in 1991 instead of the original target of 1985). Owing to geotechnical problems encountered during filling of the reservoir, particularly along the alignment of the LB canal, the construction of the infrastructure for the LB area was deferred. A re-aligned LB canal is now being built by DSI and is expected to be completed by 1997. On the RB, GIA increased to 7,260 ha, having gravity irrigation from a 61 km long main canal. In addition, DSI constructed a high level pumped canal to the north of the main canal, under its own financing, for an additional GIA of 2,035 ha. The pumping station is located close to the main canal intake and the canal capacity was increased by 1.5 m3/second. The upper canal and the pumping station were part of the original feasibility study of the scheme submitted to the Bank but were excluded from the project at appraisal owing to the high cost of pumping. 16. Implementation status: The irrigation infrastructure was completed at the end of 1992. As much as 86% of the land levelling target was achieved. The remaining OFD works were not implemented due to geotechnical problems. Irrigation commenced in 1992 after completion of the Kockopru dam (not part of the project). 17. Project impact on wrrigable area: The GIA of the project, which is located only on the RB and commanded by the lower main canal, is 7,260 ha, with a corresponding NIA of about 6,900 ha (Appendix C, Table 1 and maps in Appendix E). AIA increased from about 2,500 ha in 1992 to 5,940 ha in 1994 and is likely to increase to 6,200 ha. Of the four subprojects, Ercis has the most effective impact. I/ DSI has re-named this subproject as Erds-Kockopru since there is an existing Eris project in close vicinity, located on the left bank of the Zilan river (Appendix E, Map 5). -6- Equipment and Vehicles 18. The procurement of equipment and vehicles intended for improving the O&M of the schemes by DSI, for implementing OFD by GDRS, and for strengthening extension by GDAPD, was delayed considerably, mainly due to the long time taken in the finalization of procurement documents meeting Bank guidelines, including the drafting of the final specifications for the goods. A Bank Procurement Mission assisted the implementing agencies in November 1987 in preparing specifications and tender documents. After the initial delays and changes, procurement went ahead smoothly. By June 1988, the bulk of DSI equipment was delivered and GDRS and GDAPD completed procurement in early 1989. The equipment was satisfactorily utilized for the implementation of works. Extension 19. Implementation status: The extension component of the project was implemented satisfactorily. The extension facilities in the subproject areas were adequately strengthened as envisaged at appraisal. A total of 42 Village Group Centres (VGC) were established and agiicultural equipment, vehicles and audio-visual aids were procured for each office. The 88 motorcycles for the agricultural technicians were procured under the Erzurum Rural Development Project and the Agricultural Extension and Applied Research Project. Overseas training under the project, for a total of 43 extension staff was successfully completed by the end of 1991. The Subject Matter Specialist (SMS) posts at provincial and district levels were created as envisaged at appraisal and the positions were filled by reallocation of existing staff. 20. Impact: The target of establishing one agricultural technician per 400 farm households was not achieved. This ratio is currently 1:830 in Igdir, 1:583 in Aksu, 1:442 in Eregli and 1:343 in Ercis. However, as compared to the 'without project' situation, the number of farmers visited by extension agents increased by about 35%. Training 21. Implementation status: DSI and GDRS have implemented their respective training components satisfactorily. In 1988, DSI sent on study tours of 2-3 weeks two groups of 12 engineers each to Germany, one group of 13 engineers to Romania and two engineers to USA. In 1992, it sent a group of 12 engineers for training to USA for nine weeks, while a second group of 10 staff undertook a one-month study tour. The subjects covered were: advanced test drilling techniques, O&M of dams and irrigation networks, computer hardware and software, dam safety, environmental impact assessment and water resources and irrigation systems management. GDRS training program consisted of one month's training of 20 professionals in Germany in land surveying techniques and I&D practices during 1985, and a one-month training of 15 staff in Holland in land reclamation during 1989. - 7 - 22. Impact: Overall, the overseas training program had a good impact on both DSI and GDRS trainees. The trainees have benefited from the study tours and training courses, increasing considerably the participants' knowledge in irrigation networks operation and maintenance, cost recovery, on-farm development and soil reclamation. It is important to note that DSI and GDRS staff, trained under the project, remained with their respective organizations upon completion of the training courses. Irrigation Investment Master Plan (IMP) Study 23. As pointed out in para. 1, the IMP study was implemented under the DOFD project. It has provided the GOT with a comprehensive portfolio of 585 ongoing and proposed projects. These projects were re-evaluated and ranked in order of their expected rates of return. The IMP also presents alternative strategies for irrigation development. Agricultural Credit 24. The availability of agricultural credit in the four irrigation schemes was assured in adequate amounts by GOT, primarily through the Agricultural Bank of Turkey (TCZB). GDAPD confirmed that the credit demand in the four schemes was adequately met by TCZB which, since 1984, received financial assistance by the World Bank through the two Agricultural Credit Projects (Ln. 2318-TU and Ln. 3090-TU). Economic and Flnancial Objectives 25. The actual cost of the project (till June 30, 1995 when Loan 2663-TU was closed) was US$270.3 million (SAR US$292.0 million) comprising US$189.1 million under this project and US$81.2 million under DOFD project. The foreign cost was US$113.0 million (SAR US$115.3 million) and the local cost US$157.3 million equivalent (SAR US$176.7 million). The cost is less than estimated in,the SAR, mainly due to partial completion of works, specially by GDRS. 26. At appraisal, both financial and economic analyses were carried out. Financial Rates of Return (FRR) were expected to be very high ranging from 53% to over 100%. Economic Rates of Return (ERR) were assessed as 16.6%, 21.4%, 29.6% and 15.2% for Igdir, Aksu, Eregli and Ercis schemes, respectively. The ERR for the project as a whole was estimated as 20.3%. 27. FRRs have not been calculated for this ICR, since adequate data for preparing farm budgets to represent the true situation at project completion could not be provided by the implementing agencies. However, average financial incomes, based on financial budgets calculated for each scheme (Appendix C, Table 10), increased by 195% in Igdir, 73% in Eregli and as high as 900% in Ercis. In Aksu, the financial income for the scheme as a whole decreased by 11%, reflecting ffie low AIA so far recorded (para. 12). ERRs are below SAR estimates. - 8 - 28. The economic re-evaluation has been carried out taking into account the total investment cost of the project, against which funding was provided both under loans 2433- TU and 2633-TU. Details given in Appendix C, pertain to the costs incurred till the closure of the loan 2433-TU. The investment costs for completion incurred (after the loan closure) are taken for economic analysis, as indicated in Appendix C, Table 11. The anticipated ERRs are about 9% for Igdir, negative for Aksu, 22.5% for Eregli and 17.0% for Ercis. The project as a whole would generate an ERR of about 10%. 29. The lower ERR are mainly due to the delay in completion of the infrastructure by five to seven years, and the conservative assumption that AIA will not increase further from the level achieved in 1996, the year following the completion of the infrastructure. Also the cropping changes (conversion of land under cereals to vegetables and fruits) anticipated at appraisal have not come true, due to changes in the demands of agricultural products during the long project implementation. For the Igdir irrigation scheme, the lower ERR is also due to the 10,000 ha of Government land (para. 6) that have not so far been distributed to project beneficiaries despite satisfactory implementation of the I&D works (para. 5). Because of the risk of being moved from their current land holding to another location when land title is passed on to them, the landholders have not been willing to exploit these lands according to their production potential. With respect to Aksu, the negative ERR results from the drop (para. 9) in ALA in 1994 to about 80% of AIA in 1983, while NIA increased by 54% (Appendix C-4, Table 1). The ERR for the Eregli and Ercis schemes are only slightly lower than SAR estimates. Overall, about 28,000 farm-families benefitted under the project, well above the number of 25,400 estimated at appraisal. This has helped considerably in reducing the flow of people from rural areas to cities. C. Major Factors Affecting the Project Factors Not Generally Subject to Government Control 30. Considerable delays at the start of the project in arriving at a mutually acceptable LCB document, due to incompatibility of certain provisions of Turkey's State Bid Law 2886 with the Bank's procurement guidelines, resulted in late award of local contracts. Serious delays in implementation at Igdir, the biggest of the four subprojects, were caused by unsuccessful attempts to improve the contractor's performance during 1985-88. The contract was finally rescinded, the work split into two parts, and separate contracts awarded for each. Part IV of this scheme is still under construction and DSI expects to complete it with its own resources by June 1996. Implementation of the land levelling and reclamation components was delayed due to late arrival of machinery and equipment (para. 18). Unfortunately, the enormous mass tourism development around Antalya and its repercussions on the cultivation of the cotton crop in Aksu could not reasonably have been foreseen. - 9 - Factors Generally Subject to Government Control 31. The GOT could not complete the privatization of the 10,000 ha of the Government lands in Igdir as stipulated in SAR. It is GOT's intention to carry this out by 1998 (para. 6). As part of the GOT's ambitious plan to transfer the management and O&M of irrigation schemes to farmers through the establishment of Water User Organizations (WUOs), two WUOs have already been established in one subproject (Eregli) and negotiations between DSI and farmers to establish WUOs in other subprojects are well underway. The construction of the most important OFD works by a different agency, namely GDRS, in DSI schemes also caused delays in project implementation due to lack of synchronization in their activities. Such delays could have been avoided if one agency was responsible for both I&D and OFD works, or with better coordination between the agencies. Factors Generally Subject to Implementing Agency Control 32. Some of the problems faced during implementation at Ercis and those which still affect Eregli could have been avoided with more detailed investigations and analysis during the feasibility stage: (i) a more thorough geotechnical investigation at Kockopru dam site; (ii) a more reliable estimate of water availability and corresponding irrigable area at Eregli. Other factors that had a negative impact on the pace of implementation were (iii) lack of prior dialogue and concurrence of the beneficiaries for implementation of works, specially for land levelling and subsurface drainage; (iv) lack of a realistic project implementation schedule; and (iv) inadequate coordination between the three implementing agencies -- DSI, GDRS and GDAPD -- both at central and regional levels. D. Project Sustainability 33. The sustainability of irrigation projects depends on: (a) efficient operation and maintenance (O&M) of the irrigation system, with trained staff and adequate equipment; (b) ensuring that O&M funding is adequate; (c) availability of irrigation water and efficiency of water use; (d) mitigating the adverse effects of any environmental impacts; and (e) acceptance of the schemes by farmers. 34. O&M by WUOs: The O&M of the four I&D system is currently being carried out by the O&M sections of the Regional Directorates of DSI. At the same time, DSI O&M Department at Ankara headquarters is pursuing the transfer of O&M responsibilities to the farmers, who are organizing themselves for taking over by the establishment of WUOs. With the World Bank support through the DOFD Project, DSI staff at various levels got additional exposure to the accelerated transfer of irrigation systems in other countries such as Mexico. By the loan closing date, transfer of O&M responsibility in the four subprojects was as follows: though delays in completion at Igdir have affected the transfer, the farmers are in the process of taking over 20,500 ha. At Aksu, 20,000 ha were under transfer to five WUOs. At Eregli, 22,700 ha had already been transferred to two WUOs. The transfer had not yet started at Ercis. The farmers were keen to form these organizations and take over - 10- the O&M in their respective areas. The GOT has passed the necessary legislation for establishing the WUOs, although some issues such as financial and technical assistance to the WUOs have yet to be resolved. 35. Cost recovery (O&M): At present, the Ministry of Finance's tax collection system is responsible for recovering O&M costs from the farmers. Water charges to be collected in any year are computed on the basis of the actual O&M cost of the previous year and the actual collection extends to the next year. For the period 1983-1994, the average recovery ratios (gross cumulative receipts to total O&M expenses) at Igdir, Aksu, and Eregli were 68%, 47% and 74% respectively. However, the recovery occurs after about two years of DSI having incurred the expenditures, which reduces substantialy the recovery in real terms in an environment of very high inflation. Owing to late commissioning of the Ercis subproject, the water charges will be recovered from 1995 onwards. The national recovery ratio of all DSI schemes is presently estimated at 57%. The penalty for late payment is too low (10% above the outstanding charge) and no interest is applied to late payments. 36. Cost recovery (capital cost): The capital cost of an I&D project is recovered over a 50 year period. No costs are recovered for the first ten years. The irrigation projects have been divided into four groups and the recovery rate varies from TL 3,000/ha to TL 7,500/ha. Recovery of capital costs without indexation for inflation, over a recovery period of about 40 years yields, in real terms, less than its cost of administration and collection. GOT still considers that the agricultural sales tax (the SAR also mentions it) is an indirect investment cost recovery, which is not appropriate. 37. According to the Loan Agreement, GDRS should have taken action to recover the cost of the OFD works from the farmers (Section 4.06 of the Loan Agreement; see table 10). Although necessary legislation has been enacted and the regulation gazetted, so far no cost recovery has taken place. The legislation also needs to be amended to bring it in line with the Loan covenant (i.e. to reduce the repayment period to 20 years). 38. Water availability and water use efficiency: Water availability is a major constraint for the sustainability of the Eregli scheme. As pointed out in para. 13, DSI should develop the remaining 25 wells planned on the RB as a matter of priority since some farmers are not receiving irrigation water at all. DSI should also consider investments in water saving infrastructure besides further augmenting water. The impact of the rehabilitation and improvement of the irrigation network through an increased water-use or irrigation efficiency, is not being monitored at any of the four schemes, although provision has been made for measurement of supplies. The importance of monitoring irrigation efficiencies, however, is being brought to the attention of WUOs during handing over programs. 39. Environmental monitoring: Since both salinity and alkalinity affected parts of the four subprojects in the past, remedial measures such as subsurface drainage and gypsum treatment of soils were adopted under the project. Most of the affected areas had been reclaimed/remedied by December 1994, and GDRS planned to implement the remaining - 11 - works with its own resources. DSI, which has a small Environmental Unit attached to its Planning and Investigation Department, has not yet started environmental monitoring of the subprojects. Expansion of the existing unit is under active considemtion by DSI. 40. On the basis of criteria given in para. 33 and discussed above, the project's sustainability is uncertain. Although the farmers accepted and welcomed the transfer of M&O management, the sustainability will depend on how far DSI will succeed in achieving the transfer of management to the WUOs, and the efficiency with which they will be able to discharge their responsibilities. If successful, as in many other parts of Turkey, this would result in O&M cost recovery changing from the present ex-post system to an anticipatory collection system (to be introduced by WUOs). The sustainability of Aksu wiU remain uncertain until an economically viable alternative use of the irrigation facilities is found. The regular monitoring of environmental impacts, in particular salinity and alklinity, and of irrigation efficiencies in particular at Eregli, will contribute to project sustainability. E. Bank Performance 41. The Bank's performance during project preparation and appraisl was poor. Procurement issues that surfaced during implementation should have been sorted out earlier; the implementation schedule was overoptimistic; and institutional issues were not adequately addressed. In addition, the international waters issue with Iran that caused almost one year postponement of Board approval, was not properly identified. The subprojects were parts of much larger schemes which were already identified and prepared up to feasibility level and partly implemented or in the process of being implemented. Following the normal procedure, the Bank relied rather heavily on these feasibility studies when it selected subprojects. In hindsight, another critical look at the recommendations of the feasibility studies by specialists could have avoided the problems which arose at Aksu and Eregli. While the socio-economic changes in Aksu area could not have been anticipated during appraisal, at Eregli, however, the Bank should have emphasized exploring investments in water saving technologies once the scarcity became apparent. Given its experience with irrigation projects, the Bank should not have accepted a five year implementation period. The regional committees, expected at appraisal, could not be established, and as a result coordination between various agencies was not completely satisfactory. Although several supervision reports noted this shortcoming, Bank should have acted more forcefully to mitigate this problem. 42. To quantify the works for a rehabilitation or improvement project is normally a difficult task and is generaUy based on sample areas. The revision/updating of several key project indicators based on work quantities occurs frequently, and the project was no exception. However, some of the key indicators were amended frequently during implementation and major amendments were made as recorded in the supervision mission reports, which would have been avoided by more detailed preparation. - 12 - 43. With respect to the covenants on cost recovery of investment and of O&M, the Bank did not pursue enforcement effectively. The main implementing agency, DSI, does not collect any tariffs, although it carries out the O&M work. The non-collection is the fault of the tax collection system of the Ministry of Finance. All Bank efforts on the subject were never directed to the responsible party. The Bank could not possibly influence the performance of tax collectors under an irrigation project. However, the issue was resolved satisfactorily by the Bank in pushing for the formation of WUOs for taking over the schemes. F. Borrower's Performance 44. The Borrower was unable to comply with three important legal covenants: establishment of regional coordination committee (para. 41), distribution of state land in Igdir (para. 6), and cost recovery of on-farm development works (para. 37). Although it should be noted that DSI Headquarters in Ankara generally carried out the project's coordination responsibility, coordination at the regional level was not satisfactory and resulted in implementation delays and affected project results. It should be acknowledged that the Borrower has taken some preliminary steps to comply with cost recovery and distribution of state land which have serious implication on the project sustainability, but so far there is not an action timetable for dealing with these two issues. 45. At present, the most important task of on-farm water management (OFWM) is shared by three different agencies, namely, DSI, GDRS and GDAPD. DSI delivers the water to the farm, GDRS carries out physical OFD and GDAPD trains farmers in OFWM through its regional Extension Directorates. The present arrangements are not effective since farmers have to deal with three different organizations for OFWM. 46. The O&M department of DSI collects not only the O&M data such as actual and net irrigated areas but also agro-economic data such as cropping patterns, yields and prices, in order to determine water charges. Its monitoring work thus gets very little importance and priority. If a Monitoring and Evaluation (M&E) unit was created in the O&M or in the Planning and Investigation Department of DSI, it could have better analyzed and evaluated project performance. G. Assessment of Outcome 47. Notwithstanding the delays in implementation, the project's outcome can be rated as satisfactory. Considering the total area brought under irrigation and the concomitant rise in agricultural production and incomes, the project achieved most of its objectives and realized satisfactory development results in spite of the negative ERR generated at Aksu. Particularly important is the successful establishment of WUOs at Aksu and Eregli. DSI has made great progress in transferring irrigation systems to users (para. 34). In addition to enabling a substantial reduction in government subsidy, such tr4nsfer should contribute to a more efficient and equitable use of water. - 13 - H. Future Operation 48. Since DSI is committed to the transfer of I&D scheme management to the WUOs, operation and maintenance of the irrigation networks would become the responsibility of the water users, except for the dams and main canals of the bigger schemes. Detailed future operation plans have, therefore, not been prepared. I. Key Lessons Learnt 49. The key lessons learnt from the project are: investment projects that are heavily focused on physical components, fail to address in a substantive way the root causes of the problems facing the sector. Greater focus on institutional and policy issues when these stand in the way of efficiency is warranted; - the use (now mandatory) of country and sector specific disbursement profiles would result in a more realistic implementation period of any irrigation project; - the availability and reliability of water supply has to be critically assessed at appraisal and the command area sized accordingly, to avoid situations similar to Eregli; - delays in project implementation can be curtailed by closer cooperation and coordination between implementing agencies, but this requires developing appropriate arrangements during project preparation; - establishment of WUOs and making them responsible for management, is a major positive step for assuring the sustainability of an irrigation project; - creation of a Monitoring and Evaluation (M&E) unit in DSI and expansion of its existing Environmental Unit would contribute substantially to a quality analysis of the impact and to the planning of irrigation schemes; - the measurement of irrigation efficiencies is vital to assess the performance of irrigation schemes; - there is need for a detailed, more formalized approach to project preparation and detailed design, implementation details, operation and maintenance plans and other mechanisms appropriate for the successful implementation of the project, including time-bound schedule of performance activities and management warning systems; in this regard the present practice of requiring Implementation Plans to be developed is a step in the right direction. - 14 - Table 1: Summary of Assesnents A. Acheien<tof Obiecive SubOAntl Pahl Nealfidbt Not Awticab () (1) (V) (V) Macro policies I I E E Sector policica E E E O Finail objectives 7 EJ [O Institutional development O O E J Physical objectives [J ] I J Poverty reduction OI I J Gender issues E EJ E] Other ocial objectives J j [ O Environmental objectives j O O U Public sector management I ] EJ Private sector development O] Other (specify) 0 ] 0 0 B. P>rosect gatsfibaui -I!5el Unlikely Uncen (A (A (A Hiel C. Bank Performance atisfactory Satisfactory ne6cie (A (A (A Identification I1 0 [ Prepartion assistance E Z Appraisal E O Supervision El HiW D. Borrower Perfonrace satisfactory Satisfactory Defiient (A) (A (A) Preparation E El Implementation 0 CI E Covenant compliance E El Operation Cif applicable) I E E Hiishl Hiehle E. Asesuneat of Outcome utisfactor Satisfactory Untjsfator ustisa6tor (A (A (4 (A Ol U] El El - 15 - Table 2: Rdated Bank LIA/Credit Loon/credit Title Purpose Year of Status Approval 1. Corum-Cankiri Rural Rural development including irrigation to 1975 Closed Development Project, increase agicultural production and incomos La. 1130-TU and expand rurd employment opporunities. 2. Erzurum Rurd Irrigation development, soil conservation, 1982 Closed Development Project, roads plant protection and veternary services UL. 2094-TU components. 3. Second Agricultural Supported credit for on-farm development to Credit Project, increase agricultural production, rase 1984 Closed Ln. 2318-TU farmers' productivity and incomes, and various other free-standing agricultural projects, and an action plan for institutional development. 4. Agricultural Extension Development and dissemination of improved 1984 Closed and Applied Research agricultural technology to foster increased Project, LU. 2405-TU productivity and agricultural incomes. 5. Agriculturd Sector Deepen, broaden and refine agriculturd 1985 Closed Adjustment, adjustment programme through agreed policy Ln. 2585-TU reforms. 6. Drinage and On-farm Rehabilitation and improvement of drainage 1986 To be closed on Development Project, systems to increase agricultual production, 30 June 1995 Ln. 2663-TU productivity and incomes. 7. Agroindustry Project, Expansion and modernization of agroindustry 1989 Under Ln. 3077-TU sector, improve capacity utilization, various implementation fisheries surveys, pilot marketing training programme. 8. Agriculture Credit m, Strengthen the Agricultural Bank of Turkeys' 1989 Closed Ln. 3090-TU (TCZB) financial position through increase in its equity, settling claims of TCZB to Govermment and improving its ratio of networth to total assets. 9. Agricultural Extension Increased productivity and income through 1990 Under II Project, La. 3177-TU improving the flow of information and the implementation transmission of relevant technology. 10. Agricultural earchosea Project, Ln. 3472-T 11. Eastern Anatolia Watershed Project, = = = = = = La. 3567-TU _ - 16 - Table 3: Projet Thnetable Steps in Project Cycle Date Planned Dae Atua Identification July 1980" Prepation May 1982 Aug/Sept. 19822 Appisl September 1982 September 1982 Negotiations March 1983 May 4, 1983 Board presentation May 19, 1983 June 5, 1984 Signing June 15, 1984 Effoctivenews September 17, 1984 October 29, 1984 Midterm review (if applicable) n.a. n.a Project completion December 31, 1988 June 30, 1995- Lo)an closing June 30, 1989 Septmber 30, 1994" Te project originated with the GOT's request to the June 1980 Agricultural Sector Identification Mision for Bank financing to assist completion of irrigation schemes under construction: July 1980 for project concept and in July 1981 for specific subprojects. : FAO/CP assisted DSI in final preparation of the project. Feasibility studies prepred by DSI. Board presentation was delayed by one year due to riparian isues between Iran and Turkey, relative to tbh IGDIR irrigation scheme. i' At this time, some works remained to be completed which DSI and GDRS will be completing by 1996 and 1997 respectively. The loan was finally closed on December 31, 1994 due to delay in reconciliation of the discrqancies in the special account. T te 4: LOan/Credit Dislahwr nits: Cumtlative Estited *nd Actual (C # illion) . ......... . . . . . . . ............. FiscalYear) .............................. (18 Fiscal Ynr) 1983/84 1964/85 1985/86 1986/87 1987/88 1988/89 1989/90 1990/91 1991/92 1992/93 1993/94 1994/95 Appraisal 9.5 21.0 61.8 85.4 104.0 115.0 - - - - estiate Actual" 5.9 9.0 14.0 32.8 U6.7 61.9 77.6 107.9 110.7 110.4 - - Actuat as X of 62 43 23 38 45 54 67 94 96 96 - - esti_te Date of Fina. Dilshuraait: 18 Auswit 1992 (US$ 718,219) In ddition, disbursemnt under loan 2663-TU was made amounting to US#56.9 million; the distribution being USS14.1 million In 1992-93, USS17.0 million in 1993-94, _ US#7.0 million in 1994-95, and USS18.8 million in 1995-96. Total Bank dibursrmnt against the project thus amounted to US$167.3 million. A total of USS 4,888,603 wrem cancelled as follows: USS 4,766,222 on 31 October 1992 and USS 122,381 on 29 September 1994. - 18 - Table 5: Key Indicators for Project Implementation Page 1 Estimate Key Implementation Indicators in Unit SAR Revised Actual SAR/President's Report IGDIR.: Headworks - Intake structure No. 1 2 2 - Settling basin No. 2 2 2 - Feeder canal km 31 26 26 - Feeder tunnel m 665 314 314 Irrigation Networks - Main canal (new) km 144 210 146 - Main canal (rehabilitation) km 8 8 8 - Secondary canal (new) km 237 332 265 - Secondary canal (rehabilitation) kam 120 106 90 - Tertiary canal (new) km 381 588 421 - Tertiary canal (rehabilitation) km 208 170 136 Drainage Networks - Main & secondary drains (new) km 327 445 408 - Main & secondary drains (rehabilitation) km 121 10 3 - Tertiary drains (new) km 385 572 551 - Tertiary drains (rehabilitation) km 264 188 146 On-farm Works - Land levelling ha 38,000 38,000 38,000 - Subsurface drains ha 12,500 30,000 25,000 - Soil amendment (gypsum) tons 157,000 230,000 180,000 - Soil reclamation ha 14,000 22,000 4,200 - Surface drains ha 38,000 38,000 38,000 - Feeder roads km 190 232 232 AKSU: Headworks - Diversion weir (Kargi) No. 1 1 1 - Remodelling of weir No. 1 0 0 - Intake structure No. 1 1 1 Irrigation Networks - Main canal (new) kum 69 87 87 - Main canal (rehab) km 30 10 0 - Main tunnel m 1,250 1.520 1.520 - Main Syphon m 1,500 6.259 6.259 - Secondary canal (new) km 55 208 208 - Secondary canal (rehab) km 10 19.5 19.5 - Tertiary canal (new) km 453 208 289 - Tertiary canal (rehab) km 19 49 49 Drainage Networks - Main & secondary drains (new) km 45 28 22.5 - Tertiary drains (new) km 20 7 4.5 Flood Protection Works - Flood dikes km 70 0 0 - River channel improvement 10m3 2 0 0 - . = I = - 19 - Table 5 Page 2 Estimate Key Implementation Indicators in Unit SAR Revised Actual SAR/President's Report l On-farm Works - Land levelling ha 17,000 5,000 4,180 - Subsurface drains ha 7,000 7,000 5,000 - Surface drains klm 400 400 400 - Feeder roads km 200 200 200 EREGU: On-farm Works - Land levelling ha 17,000 17,300 17,300 - Subsurface drains ha 9,000 0 0 - Soil amendment (gypsum) tons 22,500 7,650 7,650 - Soil reclamation ha 4,000 1,500 1,500 - Surface drains ha 300 300 300 - Feeder roads km 150 150 150 ERCIS: Irrigation Networks - Main canal Ikm 51 61.156 61.156 - Main Syphon m 400 595 595 - Secondary canal Ikm 65 61.92 61.92 - Tertiary canal km 108 80.365 80.365 Drainage Networks - Secondary drains Ikm 33 32 32 - Tertiary drains kan 99 84 84 - Division ditches km 0 12.5 12.5 On-farm Works - Land levelling ha 7,100 2,000 1,725 - Subsurface drains ha 500 500 0 - Surface drains ha 5,300 5,300 0 - Feeder roads km 30 30 0 Equipment and Vehicles (4 subprojects) DSI: - Excavators, Tracked No. 14 15 - Excavator, Wheel No. 16 16 - Excavator, Gradall . No. 15 15 - Tractor, Tracked No. 20 30 - Loader, Tracked No. 14 0 - Grader, 125-HP No. 11 15 - Tractor, Wheel No. 11 0 - Trailer Unit No. 10 10 - Dump Truck IfT No. 40 41 - Truck 8-1OT No. 16 0 - Station Wagon No. 35 35 - Generator 90-100 KVA No. 4 0 - Motorcycle 150-250 cc No. 41 0 - Wireless (Radio) No. 45 41 - 20 - Table 5 Page 3 Estimate Key Implementation Indicators in Unit SAR Revised Actual SAR/President's Report GDRS: - Motorscraper No. 28 28 - Trencher 100-HP No. 21 25 - Loader Wheel 130-HP No. 7 10 - Dozer 120-HP No. 5 0 - Excavator, Tracked No. 5 10 - Bulldozer with Ripper No. 9 0 - Trailer Unit 30T No. 5 0 - Trailer, Low Bed IOT No. 6 0 - Vehicles 4-WD No. 26 11 - Mobile Repair Shop No. 6 10 - Mobile Lubricant Units No. 6 0 Training Person- 170 month DSI: Abroad (I&D) p-m n.a. 85 GDRS: Abroad (OFD/OFWM) p-m n.a. 35 GDAPD: Abroad (Extension) p-m n.a. 22 Total: 142 Extension - Buildings (County Office) No. 0 1 - Buildings (VGC Office) No. 23 42 - Agricultural equipment Sets 79 200 - Audio-visual equipment Sets 19 19 - Vehicles 4-WD No. 16 16 - Machinery set No. 7 0 - Motorcycles No. 88 0 Note: Actual figures are up to June 30, 1995. - 21 - Table 6: Key Indicators for Project Opwation No key indicators for project operation were defined in the SAR. Key indicators for future operation are as follows: 1. Government (=Hazine=Treasury) land (10,000 ha) remains to be distributed. Privatization would be carried out by 1998. 2. DSI to continue the establishment of WUOs to futher implement the on-going national program of management transfer of inigation schemes to farmers. 3. DSI to promote O&M cost recovery rate in not yet transferred schemes. Table 7: Studies Included in Project Purpose as defined Study at appraisal/redefined Status Impact of study Master Plan for Establish priority for The study was It has provided the GOT Investment in completion of many implemented under DOFD with a comprehensive Irrigation irrigation schemes in project (La. 2663-TU). portfolio of 585 on-going Development (IMP) various stages of and proposed projects construction and develop which have been criteria for future examined and ranked in investment choices and order of their priority establish a programme of and expected returns. institutional support as required. - 22 - Table 8A: Project Costs Appraisal Estimae (UJSSM) Actual (US$M) Li Loc Foreign Local Foreign Item Costs Costs Total Costs Costs Total 1. Main irrigation and drinage works 71.8 47.8 119.6 112.6 75.1 187.7 2. On-farm development works 46.5 26.3 72.8 20.5 11.9 32.4 3. Machinery and equipment 8.7 33.5 42.2 - 23.7 23.7 4. Engineering 19.2 - 19.2 .... .... ..... 5. Land acquisition 17.6 - 17.6 15.4 - 15.4 6. Training and consultants 1.2 1.1 2.3 - 1.1 1.1 7. Extension services 0.7 1.9 2.6 1.3 1.2 2.5 8. O&M 11.0 4.7 15.7 7.5 - 7.5 TOTAL PROJECT COSTS 176.7 115.3 292.0 157.3 113.0 270.3 Notes: The distribution of actual total coat into foreign and local costs is approximate. Engineering costs and front end fees are included in the actual cost of civil works. Actual costa are until June 30, 1995, when funding under loan 2663-TU was closod. The costs of completion of the balance of works after loan closure was US$81.2 million (I&D works US$77.3 million and OFD works US$3.9 million). Table 8B: Project Flnandng Appraisal Estimate (US$M) Actual (US$M) Local Foreign Local Foreign Source Costs Costa Total Costs Costs Total IBRD Funds - 115.3 115.3 54.3 113.0 167.3 Government Funds 176.7 - 176.7 103.0 - 103.0 TOTAL 176.7 115.3 292.0 157.3 113.0 270.3 Note: IBRD Funds include disbursements both under this loan and under loan 2663-TU till its closing on June 30, 1995. - 23 - Table 9: Economic Costs and Benefits Total project costs for economic analysis in constant 1994 prices are given in detail in Appendix C. These have been calculated from the actual yearly costs incurred, both under this project and under DOFD ptoject, and applying the deflators (Appendix C). For the crops grown in the area, the economic prices were estimated from the Bank's commodity forecasts for tradeable goods. For the others, the financial price was used as the economic price. The conversion factor has been taken as 1.0, and shadow pricing for labor is not applied as labor is short in the area. Both financial and economic analyses were carried out at appraisal. Financial Rates of Return (FRR) were very high, ranging from 53% to over 100%. Economic Rates of Return (ERR) were assessed at 16.6%, 21.4%, 29.6% and 15.2% for Egdir, Aksu, Eregli and Ercis schemes respectively, and for the project as a whole 20.3 %. Although FRRs were not calculated for this ICR, average financial incomes, based on financial budgets calculated for each scheme for 2 ha farm (Appendix C), increased by 195% in Igdir, 73% in Eregli and as high as 900% in Ercis. In Aksu, the financial income for the scheme as a whole decreased by 11 % over the without project situation, reflecting the low AIA so far recorded. Economic results, although generally satisfactory, are below SAR estimates. The ex-post economic re-evaluation, as detailed in Appendix C, indicated ERRs of 9% for Igdir, negative for Aksu, 22.5% for Eregli and 17.0% for Ercis. The project as a whole generated an ERR of 10%. - 24 - T"be 10 Page l TURKEY: IGDIR-AKSU-EREGLI-ERCIS (IAEE) Irrigation Project Table 10: Status of Legal Covenants A- Prc cnt Original Revised Description of cor nb | ment Section Status Fulfillment Fulfillment Covenant Date Date Loan 3.01(b) C Complete in timely manner all Only in Eregli subproject dams and other facilities area there has been shortage required to provide water to of surface water, thdt being the project. mitigated through I ______ ________ ________ _________ ___________________________ groundwater developm ent. 3.01(c) C 9/80 Yearly allocate funds for the project in the budget, and submit, for every fiscal year, the project's financial and implementation plan to the Bank. 3.02 C Employ consultant for training Consultants were employed and preparation of Irrigation under ASAL Loan 2585- Master Plan and Strategy TU. Review. 3.03(a) C Provide adequate provision for the insurance of the project financed imported goods to the i______ place of use or installation. 3.03(b) C All goods and services financed out of the proceeds of the Loan to be used exclusively for the purposes of the project. 3.04(a) C Furnish to the Bank, upon their preparation, the plans, specifications, contract documents and work and procurement schedules for the project. C = Complied with CD = Complied with after delay CP = Complied with partially NC = Not complied with. -25 - Table 10 Page 2 Agree- Present Original Revised Description of Comments ment Section Status Fulfillment Fulfillment Covenant Date Date 3.04(b) C Maintain the project benefit and cost records, enable the Bank's representatives to visit the project sites to examine the goods financed out of the proceeds of the Loan and any relevant records and documents, and furnish to the Bank all information that the Bank shall reasonably request conceming the project. 3.04(c) The Bank may publish the name and nationality of the contractor, and the contract price. 3.04(d) C Furnish to the Bank a report concerning the Project's implementation performance not later than six months after the closing date or such later I date as may be agreed. 3.05(a) C Acquire land required for the construction and operation of facilities for the project. 3.05(b) NC 7/85 2/90 Plan for distribution of state In 1987 MAFRA decided land in lgdir and offer of such that GDRS would be land to farmers responsible for leasing of land to farmers. In February 1990 responsibility for distributing land was vested in the General Directorate of Agrarian Reforms, which is now considering carrying out necessary survey work. However, funds are not yet available. 3.06 C Provision of extension services, including buildings and provision of vehicles. 3.07(a) C Provide overseas staff training in irrigation and agricultural techniques. C = Complied with CD = Complied with after delay CP = Complied with partially NC = Not complied with. - 26 - Table 10 Page 3 Algree Present Original Revised Description of Comments ment Section Status Fulfillment Fulfillment Covenant Date Date 3.07(b) C Carry out a training need assessment survey for extension staff, submit plan to the Bank, and execute the resulting training plan. l 3.08(a) NC 12/31/84 Formation of regional There has been reluctance coordinating committee. by agencies concerned, especially DSI and GDRS, to form this committee. However, cooperation between agencies has improved even in its absence. 3.08(b) C 12/03/84 12/85 Establishment of GDRS ._____ ________ ________ _________ regional office in Igdir. 4.0 C Provision of credit to farmers. 4.02(a) C Maintenance of project administrative entities. 4.02(a) C 9/80 ea. Audits. yr. 4.03(a) C Works, facilities and equipment are properly maintained. 4.03(b) C Annually Inspection of Karacaoren, Ivriz Karacaoren and Ivriz dams and Kockopru dams. inspected in 1988. Repairs at Kockopru dam have been completed satisfactorily with the assistance of 'NITRO NOBEL' of Sweden. Bank staff have inspected the dam three times. 4.04 C 7/31/85 5/88 Irrigation Master Plan Draft Master Plan received in early 1992 and reviewed _____ ______ ______ _______ _______ _____________________by the Bank. C = Complied with CD = Complied with after delay CP = Complied with partially NC = Not complied with. - 27 - Table 10 Page 4 Agme- Sti Pes le lt Original Revised Decption of Comments iet Scin Sau Fuflmn Furlment Covenant Date Date 4.05 CP DSI's irrigation cost recovery. (a) DSI has increased water charges to 100% of previous year's O&M expenditure; (b) recovery of capital cost has been negligible; (c) DSI has made proposal to GOT to impose 7% per month penalty for non-payment of _______ ________ irrigation charges. 4.06 NC GDRS's on-farm development Legislation enacted and cost recovery. regulations gazetted. However, regulations require amendments to bring it in line with loan covenant (i.e. reduce repayment period to 20 years). So far, no cost recovery has taken place. 4.07 C Provide credit to farmers in amounts sufficient to effectively utilise the expanded irrigation facilities created by the project. C = Complied with CD = Complied with after delay CP = Complied with partially NC = Not complied with. - 28 - Table 11: Compliance with Operational Manual Statements Statement number and title I Describe and comment on lack of compliance Basically, there was compliance with the applicable Bank Operational Manual Statements. Table 12: Bank Resources: Staff Inputs Planned Revised Actual Stage of Weeks US$ Weeks US$ Weeks US$ project cycle Through appraisal n.a n.a n.a 129.0 n.a Negotiation n.a n.a n.a n.a 14.3 n.a Supervision n.a n.a n.a n.a 247.7 n.a Completion" n.a n.a n.a n.a 12.0 n.a TOTAL n.a n.a n.a n.a 403.0 n.a Carried out by FAO/CP. - 29 - Table 13: Bank Resources: Missions Perfonrance rating Specialized Stage of Month/ Number Days in staff skills Implementation Development Types of project cycle year of persons field represented" status objectives probleme' Identification July 1980 n.a n.a n.a Preparation' Aug./Sept. 1982 3 A, E, EE Appraisal Sept. 1982 4 - A, E, IE, A - Supervision July 1984 1 18 E I _ 0 Supervision Sept./Oct. 1984 1 18 JE I I T, P, 0 Supervision Sept. 1985 3 20 IE, E, A 3 3 T, M, F Supervision April/May 1986 3 16 EE, E, A 1 2 T Supervision Nov./Dec. 1986 1 12 lE 3 2 T Supervision July 1987 1 5 A n.a n.a n.a Supervision Oct./Nov. 1987 1 it A 3 2 M, T, 0 Procuremente' Nov. 1987 1 6 IF, n.a n.a n.a Supervision June 1988 3 16 A, XE, E 2 2 M, 0 Supervision Oct./Nov. 1988 2 30 XE, DS 3 2 M, 0 Supervision AprilMsy 1989 3 25 IE, A, E 3 2 M Supervision Sept./Oct. 1989 1 14 IE 3 2 M Supervision May 1990 3 16 XE, A, E 2 2 Supervision June 1991 1 11 EE 2 2 Supervision Mar. 1992 2 20 IE 2 1 Completione March/April 1995 2 15 E, XE n.a n.a IE = Irrigation Engineer; DS = Dam Specialist; A = Agronomist; E Economist; FA = Financial Analyst; CS = Credit Specialist. F = Financial; M = Management; T = Technical; P = Political; 0 = Other. " Carried out by FAO/CP. V For both IAEE and Agricultural Sector Adjustment Loan. TURKEY IGDIR-AKSU-EREGLI-ERCIS (IAEE) IRRIGATION PROJECT APPENDIX A MISSION'S AIDE MEMOIRE TURKEY IGDIR-AKSU-EREGLI-ERCIS aAEE) IRRIGATION PROJECT (Ln. 2433-TlI) Implementation Completion Report (ICR) FAO/CP Mission AIDE MEMOIRE A. Introduction 1. An FAO/WB Cooperative Programme mission comprising Messrs R. Suppa (Economist/Mission Leader) and M. Riaz Hasan (Irrigation Engineer/Consultant) visited Turkey from 27 March to 12 April 1995 for the preparation of the ICR of the IAEE Irrigation Project. The mission held meetings with the concerned officials of the Treasury, the State Planning Organization (SPO), the General Directorate of State Hydraulic Works (DSI), the General Directorate for the Rural Services (GDRS), the General Directorate of Agricultural Production and Development (GDAPD) and the General Directorate of Agrarian Reforms (GDAR). Respective field officers of the DSI, GDRS and GDAPD dealing with project implementation, were met either in Ankara or in the regional offices. During its field trips to Aksu and Eregli subproject areas, the mission had fruitful discussions with Water Users Associations (WUA)1 and met with several project beneficiaries. The mission also met the Deputy Task Manager of the project in the Resident World Bank Mission in Ankara. The Acting FAOR was kept informed of the mission's activities. 2. The mission acknowledges the cooperation and courtesy extended by the Government of Turkey (GOT) and its agencies, in particular the DSI for organizing the mission's field visits. The mission's findings and recommendations, as indicated below, are subject to review and confirmation by the WB management. B. Background 3. The project was appraised in 1983; the Loan Agreement was signed on 15 June 1984 and became effective on 29 October 1984. The main objectives of the project were to increase agricultural production and incomes, expand rural employment opportunities and help towards the rationalization of a long term investment programme for irrigation development in Turkey. The project consisted of four subprojects (IGDIR, AKSU, EREGLI and ERCIS) and project components included: (a) the irrigation and drainage (a&D) infrastructure works; 1/ To cover various types of water user organizations that exist in Turkey, the term "Water User Associations (WUA)" will be changed to "Water Users Organization (WUO) in all subsequent documents regarding irrigation and drainage sector of Turkish agriculture, including all other parts and appendices of this ICR. - 2 - (b) the on-farm development (OFD), including land levelling, surface and sub- surface drainage, improvement of saline and alkaline soils and feeder roads; (c) the agricultural extension and training; and (d) the preparation of an irrigation investment master plan (IMP). 4. The project cost was estimated at US$292.0 million, to be financed by a WB loan of US$115.3 million and GOT contribution amounting to US$176.7 million. Project implementation as foreseen at appraisal was expected to be completed in five years, from 1983 to 1987. The IMP component (d) above was subsequently transferred to and implemented under the Drainage and On-Farm Development (DOFD) project (Ln 2663-TU). C. Project Implementation and Impact General 5. In terms of achieving the physical targets, the project implementation can be considered satisfactory and, at closure of project after three extensions on 31.12.1992, almost the entire financial resources were disbursed. In order to implement some outstanding activities at two subproject (Igdir and Aksu), US$38.0 million were diverted from the DOFD project to this project. Also, following detailed design of some project sub-components by the DSI and GDRS, the quantities and unit costs of relevant works and equipment were revised/ updated with the Bank's agreement. lgdir Subproject 6. Irrigable area: According to the SAR, the gross irrigable area (GIA) at Igdir was estimated to reach 56,300 ha at full development. The net irrigable (NIA) was estimated at 52,900 ha. However, the GIA at full development was later revised as 66,920 ha, corresponding to an NIA of 63,570 ha. As the subproject was implemented in four parts, the GIA/NIA under each part and the corresponding year of completion are shown below: .. .. .. .. .. ..)..... .. .. f . .. . ..X 0: f S -0 , : ; 7 .... . i! .C i': - . 7 .' . .. .. . .-' . . . .. .. : .00 . 0,t. 0f3''j. -S ......'-'S;.; .."' t ". . ....... WetPwtart 1) 34,900 70-:z: 33, 155t i3X155 -10 1 33n.i.. Part :IV: jj2 j:Q;: )0 \:l i;; ;:00009000000i ;i; 0 i;j... . ... ...... ... : :To i 1-tal: tif 66,920-|-f 4: :: :Zz nsn id ::C:::Ei:#:i :E:: i1,74A S0 :i. .1, 66.. . . .... 0 6., .7. . . . ........ . ..0 i; . .. ... .. .. . .. .. .. .. . .. . .. .... E..i E.i. .. .. E.. E. ..... .. ....E..EE.E E i Eg v a EFiS i fEF ! E sw E - 3 - 7. Inplementation status: Part I of the Igdir subproject consisted of old irrigation areas in West Igdir and needed some rehabilitation. Parts II, III and IV (described as Units 2 and 3 in SAR) are new areas requiring irrigation infrastructure and included some 10,000 ha of GOT lands (Hazine). As regards the distribution of this land, no further development has taken place since the review of the situation by the WB supervision mission of June 1991. In 1994 no funds were made available by the GOT because of budgetary constraints. The amount of TL 500 million provided in 1995 was not even enough to cover the 10% down payment requested by the contractor. The total cost of operation is presently estimated at TL 125 billion for a total area of 36,000 ha which includes the 10,000 ha of Hazine. It is the GDAR intention to cover the total 36,000 ha in one single operation by 1998. 8. The irrigation improvement and rehabilitation component has been fully implemented by the DSI in Parts II and III, although irrigation in Part HI does not start until 1995. Construction of irrigation infrastructure in Part IV is in progress and it will be completed by June 1996. The status of OFD component, implemented by the GDRS, is as follows (% completed): Land Levelling 84%, Sub-surface Drainage 74%; Feeder Roads and Surface Drainage 100%, and Land Reclamation 20%. The main reason for the low implementation level of land reclamation sub-component was the delay in the delivery of the machinery for this purpose. The GDRS expects to complete some 4,000 ha of gypsum treatment in 1995 and another 4,000 ha in 1996. For this purpose, about 176,000 tonnes of gypsum has been stacked in the subproject area. 9. Project impact: The irrigation ratio (IR) or the ratio of actual irrigated area (AIA) to net irrigable area (NIA) is often used in Turkey as an index to measure the impact of an irrigation project. In 1983 (without project situation), the IR was 86% with an NIA of 26,600 ha and the AIA of 22,925 ha. As the project developed, the NIA increased to 45,000 ha in 1994, including some 3,260 ha of Part III, but the AIA increased only to some 25,000 ha despite the improved irrigation facilities and OFD works . The IR declined to 56% in 1994 because some 8,000 ha still require land levelling and a further 6,000 ha have salinity and sodicity problems. It appears that the full project benefits may not be achieved until 1996-97 when the IR would also reach a satisfactory level. Aksu Subproject 10. Irrigable area: The NIA at Aksu was about 13,745 ha without project (GIA 15,457 ha). With project, the NIA has increased to 22,250 ha and the GIA to 23,667 ha. The GIA and NIA are distributed along the Aksu River as follows: -4- 30 i -- ; -; - i0---il ; GIA I -02 i40gNLKIA 0 00 R ig...... . .. . . .. 7 6 9 5 .. ..... . :tLeflt BPanklggi00 ;:i(Phse I)::-:. 7 ;i;;--7,762: ::00l:;;j:::i0t- 0:::::7,2960; : :0: K a rg ...... ... ..... Total: 23,6..67..... 22,.2.3.0... ... . .. 11. Implementation status: Except for the rehabilitation of 10 km of main canal, the irrigation components have been implemented in full. The land levelling component of the OFD works was revised from the SAR estimate of 17,000 ha to 5,000 ha and out of this land levelling was carried out on 4,677 ha (93.5% of the target). The sub-surface drainage and feeder roads sub-components were fully implemented. The mission was told that several c;otton growers were reluctant to allow land levelling on their fields and this was the main cause for revising the land levelling sub-component. 12. Project impact: Without project, the IR was about 77% with a NIA of 13,745 ha and an AIA of 10,522 ha. When project was fully implemented in 1992, the IR had fallen to 5-2% with the NIA increasing to 22,350 ha and the AIA decreasing to 11,604 ha. During 1993 and 1994 the IR fell further to 47% and 39% respectively with the NIA of 21,950 ha (full development) and AIA decreasing to 10,394 ha in 1993 and 8,685 ha in 1994. The DSI at the central and regional levels gave the following reasons for this steady decline: (i) the demand for cotton, the dominant crop, had fallen in the area in recent years and the farmers seem to prefer rain-fed to irrigated crops because of the marketing problems with the latter; (ii) the number of green houses in the area have increase from 700 in 1984 to 3,900 in 1994; and (iii) many young farmers are taking up jobs in the region's lucrative tourist industry in summer and some of them are giving up farming altogether. Eregli Subproject 13. Irrigable area: Prior to the project, the GIA was 31,860 ha and the MIA was about 30,270 ha. The AIA, according to the SAR, was not more than 14,000 ha and the IR was estimated as 46%. With the completion of the Ivriz dam in 1985, the GIA increased to 37,649 ha and the NIA to 32,294 ha. On implementation completion in 1992, the distribution of the GIA and MIA along the Ivriz River is shown below: 5 GIA NMA - , --- - - -): ................ Right Bank 21,166 18,200 Loft Bank - - . . -10,270 8,832 Akhuluk-Ciller 5,570 .4,709 Yildizli ' 643 553 Totak - - . . . .37,649 32,294 14. Implementation status: The Ivriz dam and the appurtenant works were under construction at the time of the project appraisal and these or any other irrigation infrastructure at Eregli do not form part of the project. Only the OFD component was implemented under the project and its entire physical targets were achieved by the closure of the project in 1992. 15. Project impact: As pointed out in para. 13 above, the pre-project IR was about 46%. During the 1992-94 period, the IR averaged about 75%. The project had an overall positive impact on irrigated agriculture in the area. 16. Both the DSI and the farmers pointed out that the main cause of not being able to irrigate the entire NIA is the inadequate capacity of the Ivriz dam. With an active storage of 80x106 m3, a mean annual inflow of 234x106 m3 and a regulation ratio of 85%, the dam can irrigate 20,000-25,0000 ha depending on the cropping pattern and the overall irrigation efficiency. In order to augment irrigation water supplies, the DSI drilled 60 tube wells in the left bank (LB) area and 15 tube wells in the right bank (RB) area and a further 25 wells are planned in this area. When all 100 wells are drilled, their combined yield would be about 36x106 m3 and they would be able to irrigate an additional area of 4,000-5,000 ha. Therefore, the dam and the wells can, at best, irrigate a total area of 30,000 ha, which still falls short of the NIA of 32,294 ha for which irrigation infrastructure is available. In 1994, for example, the total water resources available for irrigation were 160X106 m3 (dam 132x106 m3 + wells 28x 106 m3) and these together irrigated an area of about 25,000 ha. The DSI informed the mission that irrigation schemes in Turkey are normally designed to supply water only to 90% of the total command area (or NIA). Other factors which have contributed to the above were: (i) leakages from the main canal in the Akhuluk-Ciller area in a 7 km length where the canal passes through gypsum area, and (ii) inadequate capacity of the RB canal. However, the DSI has taken prompt remedial measures and the 7-km length of the canal has been appropriately re-lined and the RB canal has been raised by about 0.3 m. -6- Ercis Subproject2 17. Irrigable area and modified irrigation layout: The Ercis subproject was primarily designed to irrigate a combined GIA of 7500 ha (RB: 6700 ha; LB: 800 ha) of River Zilan. Owing to the serious geotechnical problems encountered in the construction of the Kockopru dam - which was completed in 1991 instead of 1985 - and the LB canal, the subproject design was amended in the initial stages. Emphasis was placed on the RB development and the LB area was taken out of the Bank funding. A re-aligned LB canal is now being built by the DSI and it is expected to be completed by 1997. On the RB, a GIA of 7,260 is commanded by a 61-km long main canal. In addition, a high level canal was built to the north of the main canal by the DSI with its own financial resources to command an additional GIA of 2,035 ha. Water to this canal is pumped from a pumping station close to the main canal intake built by the DSI. As a result, the capacity of the main canal at intake was increased by 1.5 m3/second. The DSI informed the mission that the upper canal and the pumping station were part of the original project feasibility submitted to the Bank but these were excluded from the project at appraisal owing the high operating cost for pumping. 18. The modified gross and net irrigable areas on the RB are as follows: ~......... ..(ha. L tower: mami can- 7,260 6,90Q0. ; Total: ..92.9...5 8 830 19. Implementation status: The irrigation infrastructure was completed by the DSI at the end of 1992. Only 86% of the land levelling target was achieved by the GDRS. The remaining sub-components were not implemented due to the geotechnical problems. Irrigation commenced in 1992 on the completion of the Kockopru dam (not part of the project). 20. Project impact: The project impact has been significant and the area brought under irrigation has increased from about 2,500 ha in 1992 to 7,600 ha in 1994. The IR in 1994 was 86% and it is likely to increase in 1995 as the GDRS carries out further OFD with its own resources. Of the four subprojects, the Ercis seems to be most effective. Extension 21. The extension component of the project was also implemented satisfactorily and the extension HQs in the subproject areas were adequately strengthened as envisaged at 2/ The DSI have re-named this sub-project as Ercis-Kockopru since there is an existing Ercis project in close vicinity, located on the left bank of Zilan river. - 7 - appraisal. A total of 42 Village Group Centres (VGC) were established and agricultural equipment, vehicles and audio-visual aids were procured for each office. Overseas training for a total of 43 extension staff was successfully completed by the end of 1991. Training 22. The DSI, GDRS and GDAPD have implemented their respective training components within Turkey and abroad satisfactorily. Irrigation Master Plan (IMP) Study 23. As pointed out in para 4, the IMP study was implemented under the DOFD project. It has provided the GOT with a comprehensive portfolio of 585 ongoing and proposed projects. These projects have been examined and ranked in order of their priority and expected returns. The IMP has also presents alternative strategies for irrigation development. D. Actual Project Costs and Disbursements 24. Total final disbursement, as of July 1992, amounts to US$110.4 million representing about 95 % of the total loan amount made available by the WB (Loan 2433-TU). However, despite this good disbursement performance, some important civil works and OFD activities at Aksu and Igdir subprojects remained to be completed. These were finally implemented using US$38.0 million made available from the Drainage and OFD project (Loan 2663-TU). Total project costs, including GOT contribution, will be estimated during the course of the preparation of ICR in Rome. E. Institutional Performance 25. The individual performance of the three main institutions involved in project implementation - DSI, GDRS and GDAPD - was satisfactory on the basis of the physical implementation achieved (Section C). The SAR stipulated that the DSI Headquarters in Ankara will coordinate the tasks and contributions of other agencies involved. In addition, a coordinating committee at regional level comprising the main agencies and chaired by the provincial governor was expected to monitor progress. Although the SAR recommendations with respect to coordinating project activities have been followed, the mission noted that closer cooperation and coordination between various agencies would have expedited project implementation. The GDRS, for example, did not seem to know of the modified project layout at Ercis for the implementation of the outstanding OFD works (para 17). 26. The most important task of on-farm water management (OFWM) is shared by three different agencies, namely, DSI, GDRS and GDAPD. The DSI delivers the water to the farm, the GDRS carries out physical OFD and the GDAPD trains farmers in OFWM through its regional Extension Directorates. The feedback from farmers, interviewed by the mission, - 8 - indicates that the present arrangements are not very effective since farmers have to deal with three different organizations for OFWM. 27. The Operation and Maintenance (O&M) department of the DSI collects not only the O&M data such as actual and net irrigated areas but also agro-economic data as cropping patterns, yields and prices in order to determine water charges. It is the mission's view that these activities should be carried out by a Monitoring and Evaluation (M&E) unit which does not exist in the DSI at present. This unit could also be responsible for evaluating project performance. However, a small Environmental Unit is attached to the Planning and Investigation Division of the DSI. F. Project Sustainability and Future Outlook 28. Existing situation: The sustainability of irrigation projects depends on (a) prolonging the project life through efficient O&M of the irrigation system, and (b) mitigating the adverse effects of water-logging, salinity, siltation and soil-plant-water reactions under irrigation. Since both salinity and sodicity have affected parts of the four subprojects, remedial measures such as sub-surface drainage and gypsum treatment of soils have been adopted under the project. Although not all the affected areas have been reclaimed/remedied by December 1994, the GDRS indicated that it will complete its remaining tasks with its own financial resources. The O&M of the irrigation infrastructure is being carried out by the O&M sections of the Regional Directorates of the DSI. At the same time, the O&M department in Ankara has started the transfer of O&M responsibilities to the farmers through the establishment of the Water Users Association (WUA). 29. Cost recovery (O&M): At present, the DSI is attempting to recover the full annual O&M cost for irrigation infrastructure from the farmers. Water charges for the current year are computed on the basis of the actual O&M cost of the previous year. On the basis of data supplied by the DSI for the period 1983-1994, the average recovery rates at Igdir, Aksu and Eregli were 68%, 47% and 74% respectively. Owing to late commissioning of the Ercis subproject, the water charges will be recovered from 1995. The overall recovery rate is presently estimated at 57%. The penalty for late payment is rather low (10% above the outstanding charge) and no interest is applied to late payments. 30. According to Covenant 4.06 of the Loan Agreement, the GDRS agreed to recover O&M cost of the OFD works from the farmers. The necessary legislation has been enacted and the regulations gazetted. Some of the regulations need to be amended to bring them in line wit the Loan Agreement. The GDRS has not started cost recovery yet. 31. Cost recovery (capital cost): The DSI normally recovers the capital cost of a project over a 50 year period. No costs are recovered for the first ten years ("grace period"). The irrigation projects have been divided into four groups for this purpose and the recovery rate varies from TL 300/decare (1 decare=0. 1 hectare) to TL 750/decare. Recovery of capital - 9 - cost without interest over a long recovery period of about 40 years yields in real terms only a small fraction of the actual project cost. 32. Future outlook: The transfer of irrigation schemes and their O&M to the WUAs has gained momentum and, as of 1 April 1995, a total irrigated area of about 486,000 ha was under the control of WUAs in different regions of Turkey. The DSI is planning to transfer a total area of 800,000 ha to WUAs by the end of 1995. The situation in the four subprojects is as follows: the delay in completion of Igdir subproject has affected the transfer but the farmers are in the process of taking over 20,500 ha of the total subproject area of about 67,000 ha; at Aksu 20,000 ha are under transfer to five WUAs; 22,700 ha have already been transferred at Eregli to two WUAs; transfer has not yet started at Ercis. In view of the highly positive results of transfer, both the DSI and the GDRS have expressed strong desire for continuation of Bank's assistance under a new project. The mission was informed by the DSI that the establishment of a M&E unit and the strengthening of the existing Environmental unit are under consideration. G. Key Lessons Learnt 33. The key lessons learnt from the project are: The long-term socio-economic trends in a development area should be fully assessed in order to avoid the experience of the Aksu subproject, where changes in socio-economic conditions since 1983 seems to have made a large part of the upgraded scheme redundant. Also, plans to diversify crops in those years when the demand for certain crops falls should be available to farmers. - The availability of water from different sources should be critically assessed under different cropping patters and irrigation efficiencies at the feasibility stage of a project in order to determine the area to be irrigated. If the developed water resources are found to be inadequate -as in the case of Eregli - immediate action should be taken to augment these resources either from surface or underground sources. The current DSI practice of designing irrigation schemes to satisfy only 90% of the total scheme water requirements is not compatible with internationally acceptable criteria. Delays in project implementation could have been curtailed by closer cooperation and coordination between DSI, GDRS and GDAPD. At present, the farmer has to deal with three different organizations - DSI, GDRS and GDAPD - to seek advice and assistance in OFWM activities. It would immensely help the farmer if the same agency which delivers water to the farm also carries out the OFD works. - 10- It is important to recognise that members of the WUA will, in future, not only bear the costs but also share the benefits of irrigation and this is a major step towards an effective and sustainable system of irrigation water management. Recovery of capital cost without interest over a long recovery period of 40 years yields in real terms only a small fraction of the actual project cost and needs to be reviewed as a matter of priority. Project performance evaluation and environmental impact assessment is indispensable to an organization like the DSI. The establishment of a Monitoring and Evaluation (M&E) unit and the strengthening of the existing Environmental unit would go a long way in planning and monitoring sustainable irrigation schemes. The measurement of irrigation efficiencies is vital to assess the performance of an upgraded or rehabilitated irrigation scheme. This most useful task could be carried out by the Regional Directorates of the DSI in charge of the subprojects. F. Follow-Up 34. The mission will return to Rome on 12 April 1995. During the following three weeks it will prepare the draft ICR which will be transmitted to the WB by early May 1995. It is recommended that the DSI should also finalize its implementation completion report and send it to the WB by early May 1995. TURKEY IGDIR-AKSU-EREGLI-ERCIS (IAEE) IRRIGATION PROJECT APPENDIX B BORROWER'S CONTRIBUTION TO THE ICR DSI's inplementation Completion Report on the Igdir-Aksu-Eregli-Ercis (IAEE) Irrigation Project (Loan 2433-TU) The loan agreement of IAEE project was signed on June 15, 1984 between the Republic of Turkey and the World Bank. This project was carried out by the General Directorate of State Hydraulic Works (DSI), General Directorate of Land and Water Conservation (TOPRAKSU), and the Provincial Extension Services Arm of the General Directorate of Agricultural Affairs of the Ministry of Agriculture and Forestry (TZ). The project is intended to increase agricultural production and incomes, expand rural employment opportunities and provide assistance for preparation of a long-term program for irrigation development. The IAEE Irrigation Project includes Igdir, Aksu, Eregli and Ercis subprojects and project components included: (a) the irrigation and drainage works; (b) provision of equipment for construction, operation and maintenance for the subprojects of the project; (c) improving agricultural extension services in the project areas including provision of buildings, equipment and vehicles therefor and training, (d) improving the on-farm development; and (e) the preparation of an Irrigation Investment Master Plan. Project Implementation A. Civil Works The project became effective on October 29, 1984 and the loan closed, after three extensions, on June 30, 1992; the unfinished works have been transferred to Loan 2663-TU. 1. lgdir Subproject The lgdir subproject was implemented in four parts: Part I (the gross irrigable area [GIA] is 34,900 ha); Part II (GIA is 34,900 ha); Part III (GIA is 10,445 ha); and Part IV (GIA is 12,539 ha). Part I of the project consisted of old irrigation areas in West igdir and needed rehabilitation works. Parts II, III and IV are new areas requiring the irrigation and drainage works and included some 10,000 ha of GOT lands. 1 The irrigation and drainage improvement and rehabilitation works have been. implemented by DSI in Parts I, 11 and III. The construction of irrigation and drainage network system in Part IV is going on. 2. Aksu Subproject The Aksu subproject was implemented in three parts: The irrigation facilities in Phase I (Right Bank GIA: 7,990 ha, Left Bank: 8,060 ha). Phase II (Right Bank GIA: 2,620 ha, Left Bank: 2,290 ha) and Kargi Weir (GIA: 2,240 ha) except for the rehabilitation of 10 km of the main canal have been implemented. 3. Eregli Subproject The Ivriz dam and the irrigation and drainage system were under construction at the time of the project appraisal. Therefore, this project was not included in the loan, 4. Ercis-Kockopru Subproject Ercis project contains Kockopru dam, lower main canal and upper canal. The construction of the Kockopru dam was completed in 1991 instead of 1985 because of the serious geotechnical problems. The right bank development and left bank area were taken out of Bank funding. A realigned left bank canal is now being built by DSI. On the right bank, the lower main canal was completed. In addition, the upper canal was constructed to the north of the main canal by DSI with its own financial resources. Water to the upper canal is pumped from a pumping station close to the main canal intake constructed by DSI. The upper canal and the pumping station were part of the original project but these were taken out from the project at appraisal because of the high operating cost for pumping. The irrigation infrastructure was completed by DSI in 1992. DSI has spent US$67,735,358 from the loan for civil works. Civil works implementation performance has been quite high. B. Machinery and Equipment Procurement DSI has implemented its training program under this loan through sending its engineers of headquarters and project sites to Europe and USA. These training programs have been completed satisfactorily. 2 DSI's Comments and Conclusions on the IAEE Project Implementation The above-cited projects, namely, Igdir, Aksu, Eregli and Ercis, have been selected from different locations of Turkey with having different characteristics and varied potential economical and social impacts. First of all, this typical selection of four different irrigation schemes under a World Bank loan has led to different experiences. The following are viewed as major benefits of the project: * acceleration of project implementation * increased quality of civil works due to better control * increased coordination among concerned institutions * visible outcome compared to conceptual or policy oriented projects. The deficiency of funding which initially occurred due to shortage of counterpart local funding in civil works, had later been solved and foreign funding rate has been increased during the Gulf Crisis. This change in the rate had substantially accelerated the implementation performance in IAEE projects (increased rate has highly helped completion of Aksu project and elevated the completion rate of Igdir project to 90% under the Drainage and On-Farm Development Project (another World Bank project), of which funds were used for the remaining IAEE subprojects). Therefore, a high foreign funding rate has been found to be more convenient for upcoming projects. Conclusively, the IAEE project has been implemented in a satisfying manner. Individual projects are proven to be far more practical and technically sound projects. Taking this opportunity, DSI wishes to commend the staff of the World Bank for their very encouraging and supportive cooperation. 3 GDRS's Implementation Completion Report on the Igdir-Aksu-Ereeli-Ercis (IAEE) Irrigation Project (Loan 2433-TU) The loan agreement undersigned in 1984 provided a project loan of US$115,300,000.00 for four individual irrigation projects, namely Igdir, Aksu, Eregli, Ercis (IAEE Irrigation Project Loan 2433-TU). This loan closed on June 30, 1992 (Table I: implementation and disbursement IAEE projects in 2433-TU) and Table [1: training components in IAEE projects in 2433-TU). Since there had been uncompleted civil works component in the project at loan closing, an agreement was reached between the Government and the Bank for inclusion of the remaining IAEE works in the Drainage and On-farm Development project (Loan 2663- TU) in order to facilitate completion of the IAEE components and finalize remaining disbursements. Total expenditure made from Loan 2663-TU for IAEE project US$2,896,769.00 (Table III). 1 TABLE I * Bi~~~~~~~~~L2Ei 6Y~~~~~~~~t 59 ~ -A 1,1 IFIIELPik, Of-7 09 OTAL ML AS~~~~~~~~~~~~~~~~~~1KCDTAFA LO 2705T 0307*9 AN DI510U518EhT C00E0)T A' . . .. A: P~~~~~~"7AS : 2:U:~~~~~; ~~Mt11N 72) 3 9r703 ~~-I,)"!O 7: (1210 Ti 3) (6ifTAi (MILLION TLI (MILLION TL) ($ ,,A4'? ''.-r ':3;~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~9 320 I1 32165 41823 F4- S ~~~~rrC9 134:0471 -' ~~~~~~~~~~~~~~~~~~~ 7:55 ~~~~~~~~'Z4 4 :83 22,205 3)813 42479 S3P96 . ...... - ~~~~~~~~~~~~~~~~~4180 2784 6522 83 RSAS ' 641 23 - - - 222/4I6F4 225 641 ''' 007 7~~~~~~~~~~~~~~~~~~~f - - - ~~~~~~~~~~~~~5991 87R7 JANM 17.001L7N',. 4 27 4 - 4180 640 1214 327 .Tn2iqr *:m FA : 1' - - 5000 2197 407592 Rn A[ 7 '7 0/0 1 74 )74 .45 821'S 7%1i452 296(2 --- 17300, 1313 2636 K25 MO: 707IANATISl1 I5~~~~~~~~~~~~~~~~~0 5'$ 4 3 - - - - 1500 4 9 6~~~~~~~~~~~~~~~~50 49 .903:01 6542 : t4~~~~~~~~* A'7 %. 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Группа Всемирного банка · Implementation Completion and Results Report
Turkey - Igdir-Aksu-Eregli-Ercis (IAEE) Irrigation Project
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