Document of

The World Bank

FOR OFFICIAL USE ONLYL

Report No. 5075

PROJECT COMPLETION REPORT

BANGLADESH

SHALLOW TUBEWELLS PROJECT

Credit 724-BD

May 9, 1984

Irrigation I DivisionSouth Asia Projects Department

This document has a restricted distribution and may be used by recipients only in the performance oftheir official duties. Its contents may not otherwise be disclosed without World Bank authorization.

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FOR OFFICIAL USE ONLY

TABLE OF CONTENTSPage No.

PREFACE ..............................------------------ iBASIC DATA SHEET ........................................... iiHIGHLIGHTS ........................--------------------- iii

I. SUtMIARY AND CONCLUSIONS ..................................... 1

II. BACKGROUND ........... ....................................... 3

III. IDENTIFICATION, PREPARATION AND APPRAISAL. 5

IV. THE APPRAISED PROJECT ...................................... . 7

Project Description ....... ............... . 7Cost and Financing .................... .............. 7Management and Organization ................................ 9Benefits ......................... .......................... 10

V. THE IMPLE4ENTED PROJECT ...... ............................... 11

Project Start-up ........................................... 11Procurement and Sales of STWs ..... ......................... 11Preparation of Thana Irrigation Maps ......... .. ............ 13Construction of Workshops ............... .. ................. 13Procurement of Machinery and Equipment ......... .. .......... 13Repair and Maintenance .................. ................... 14Vehicles and Office Equipment ............. .. ............... 14Project Evaluation Studies .............. .. ................. 14Technical Assistance ......... .............................. 14Costs and Financing ........................................ 15

VI. AGRICULTURAL LIPACT ....... .................................. 16

Irrigated Area ...................... ....................... 16Cropping Patterns ..................... ..................... 17Yields .......................... ........................... 18Production ................................................. 19

VII. FINANCIAL kND ECONCMIC RESULTS . . . .20

Impact on Farm Income and Employment . .20

Socio-economic Impact .. 20Appraisal Economic Estimates .. 21Current Estimates .. 21

VIII. BORROWER AND IDA PERFORMANCE . . . .23

| 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.

ANNEXES

ANNEX 1 - Implementation Schedule (Appraisal Estimatesand Actual Results) .... ....... .. . see .......... .... 25

ANNEX 2 - Actual Schedule of Expenditures by BADC ........... s..... 26ANNEX 3 - Distribution of STWs and Irrigated Area ............... 27ANNEX 4 - Appraisal Estimates of Cropping Patterns

by Ecological Zones ... . .............. ..s..... s 28ANNEX 5 - Actual Cropping Patterns by Ecological

Zones in 1982-83 ...... ..... ...................... . * * *.. 29ANNEX 6 - PCR Estimates of Cropping Patterns by Ecological

Zones at Full Development in 1988-89 .se................. 30ANNEX 7 - Appraisal Estimates of Cropping Patterns,

Yields and Production ................... . . .......... ... . 31ANNEX 8 - Actual Cropping Patterns, Yields and

Production (1982-83) . ................ ....... ................ . , 32ANNEX 9 - PCR Estimates of Cropping Patterns, Yields and

Production at Full Development (1988-89) .............. 33ANNEX 10 - Crop Input Requirements ............................... 34ANNEX 11A- Economic Prices of Agricultural Inputs and Outputs .... 35

11B- Economic Real Flow ..* *........ * ... *................... *. 36ANNEX 12 - Summary Paragraphs in Supervision Reports ............. 38ANNEX - Borrower Comments .43

ABBREVIATIONS AND ACRONYMS

ADB - Asian Development BankBADC - Bangladesh Agricultural Development CorporationBIDS - Bangladesh Institute of Development StudiesBKB - Bangladesh krishi BankDTW - Deep TubewellERR - Economic Rate of ReturnGOB - Government of BangladeshHTW - Hand TubewellHYV - High Yielding VarietyICB - International Competitive BiddingIDA - International Development AssociationIMP - Irrigation Management ProgramIRDP 1/ - Integrated Rural Development Program

1! IRDP in reorganized form is now called Bangladesh Rural Development Board(BRDB), but is referred to by its former name in this report.

KSS - Krishi Samabaya Sn.iyv (Farmers' Cooperative Societv)MRGRD & C - Ministry of Local Government, Rural Development and

CooperativesLLP - Low Lift PumoM - MillionMd - Maund (37.3 kg)

M&P - Mechanized Cultivation and Power PumpDivision of BADC

NCB - Nationalized Commercial BankN'PW - Net Present Worth

PCC - Project Coordination CommitteePP - Project ProformaRD - Rural DevelopmentRMB - World Bank Resident Mission in BangladeshSTW - Shallow TubewellTCCA - Thana Central Cooperative AssociationW - With Project CaseW - Without Project Case

Fiscal Year

July 1 - June 30

- (i) -

PROJECT COMPLETION REPORT

BANGLADESH

SHALLOW TUBEWELLS PROJECT (Cr. 724-BD)

Preface

This is a Completion Report of the Bangladesh Shallow TubewellsProject for which Credit 724-BD was approved June 16, 1977, in the sum ofUS$16.0 million equivalent. The Development Credit Agreements were signedJuly 1, 1977. The Credit became effective December 9, 1977.

The PCR was prepared by the Agriculture Division I of the SouthAsia Region on the basis of the Staff Appraisal Report (724-BD), theDevelopment Credit Agreements dated July 1, 1977, supervision reports,progress reports, correspondence with the Borrower and internal Bankmemoranda on project issues as contained in relevant Bank files.

This report has not been subjected to an audit by the OperationsEvaluation Department.

A copy of the draft report was sent to the Borrower on November 1,1983 for comments. Borrower's comments are attached as Annex to thisrepo rt.

(ii)BANGLADE SH

SHALLOW TUBEWELLS PROJECT (CR. 724-BD)

Project Completion Report

Basic Data Sheet

Appraisal Actual or Actual es x ofKey Project Data Estimate Current Estimate Appraisal Estimate

Total Project cost (US$ M) 25.4 21.5 85Overrun (Underrun (x)

Credit Amount (US$ M) 16.0 14.16 (up to 0S/83) 88Date Board Approval 06/16/77Date Effectiveness 12/09/77Date for Completion of Physical Components 06/81 12/82 -Purchase, Install. and Sale of STWs-number 10,000 11,000 110Completion Construction of

1 Regional Workshop Number 1 1 1005 Zonal Workshop Number 5 4 100

100 Thana Workshop Number 100 80 80Purchase of Workshop Equipment and Tools % 100 50 50Incremental Economic Rate of Return x 48 46 96Financial Performance - Satisfactory -'Institutional Performance Satisfactory-

Cu-ulative DisbursementsFY 77-78 78-79 79-80 80-81 81-82 82-83

Semester 1st 2nd 1st 2nd 1st 2nd 1st 2nd Ist 2nd 1st 2nd

Appraisal Estimate (US$ M) 0.30 1.50 3.00 5.00 /.50 10.00 12.50 15.00 16.00 - - -Actual (US$ M) - - 0.01 0.0/ 0.25 2.40 9.89 12.16 12.12 13.31 13.5/ 14.20Date of Final Disbursement

Special-Date No. of Mandays ization 1/ Status/ Types of

Mission Data Ho/Yr Persons in Field Represented Trend Problema

Identification 06/722- Preparation _ _ _Appraisal I 02/03/76 5 100 2/ A, 8, D -

II (Follow-up) 05/09/76 2 30 2/ B, D -

Sub-total 130

Supervision 1 10/77 1 5 D 2/1 M 4/Supervision 2 10/11/78 4 32 2/ 0 2/2 MSupervision 3 05/79 2 25 2/ B, C 2/1 MSupervision 4 10/11/79 1 12 2/ C 2/1 MSupervision 5 07/08/80 2 16 2/ A, C 2/1 MSupervision 6 04/05/81 1 5 2 C 2/1 HSupervision / 04/05/82 1 9 2/ C 2/1Supervision 8 PCR I GOB 3/ 02/83 1 28 B - -

Supervision 9 PCR II H.Q. 06 83 1 11 A - -

Sub-total 143

Total 2/3Ot1her Project Data

Borrower People's Bank of BangladeshExecuting Agencies BADC, IRDP & NCBs (The Sonali and Janata Banks)Fiscal Year July 1 to June 30Country Exchange RateName of Currency Taka (Tk)Appraisal Year Average US$1 - Tk 15Intervening Year Average US$1 - Tk 16.771Completion Year Average US$1 - Tk 23.745

1/ A - Agriculturist; B - Economist; C - Agri-Industry Specialist; D - Engineer.2/ Estimated mandays in field utilized for this project.3/ A consultant from the Rajehahi University was engaged by GOB for preparation of a draft

PCR which was submitted to IDA in May 1983. BADC comments were submitted in June 1983.4/ Managerial.

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PROJECT COMPLETION REPORT

BANGLADESH SHALLOW TUBEWELLS PROJECT(CREDIT 724-BD)

HIGHLIGHTS

The project was a direct product of the 1972 Bank Group-sponsored Landand Water Resources Sector Study that emphasized, inter alia, groundwater develop-ment in Bangladesh where surface water resources were seasonally scarce. The mainobjectives of the project were to increase foodgrain production and farm incomes,rationalize and strengthen rural institutions, and improve utilization of existingirrigation facilities. These goals were to be met through sale, installation andutilization of about 10,000 shallow tubewells (STWs) to enable dry season irriga-tion, credit facilities through the nationalized commercial banking system,upgrading repair and maintenance facilities for all irrigation equipment in theNW region, and evaluation studies assessing project impact and the effectivenessof repair and maintenance services.

The project was generally well conceived andJcan be considered a success.Government's performance in carrying out its obligations under the project wasgenerally satisfactory. Due mainly to initial procurement problems, implementationtook 1.5 years longer than originally expected. Nevertheless, appraisal targets ofSTWs sold were eventually exceeded by 10%. Cash sales did not meet expectations,but credit sales to individuals were about double appraisal estimates. Civilwork targets were met except for thana-level workshops and storage tanks.However, only about 50% of expected tools and equipment for various workshopswas obtained. Socio-economic studies were conducted, and various technicalreports on equipment maintenance were prepared. Reflecting mainly taka devalua-tion during implementation and some reductions in project scope, total projectcost proved about 15% less than appraisal estimates, and IDA Credit savingstotalled US$1.8 M (11%). The project resulted in an estimated 102,000 tons ofincremental foodgrains by 1982-83, which are expected to increase to about120,000 tons by full development in 1988-89. The project's economic rate ofreturn is estimated at 46%, compared with an appraisal estimate of 48%. About118,000 farm families have received irrigation capability through the project,and to date about 6.4 M mandays of annual incremental employment have resulted.

Other points of interest are:

- Elimination of the public hire-purchase system for STWs and establishmentof commercial banks as creditors for STW purchases proved important insti-tutional successes of the project (paras 3.03(b), 5.06, and 8.01).

- Benefiting farmers to date have generally not cultivated wheat with dryseason STW irrigation, as expected at appraisal, but have opted for paddy(paras 6.01-6.08).

- After initial STW procurement problems, incorporation of farmers' choiceprocedures in such procurement was satisfactory and expediting (paras 5.02-5.04).

- Further exploitation of groundwater, especially in the NW region, should bepreceded by establishment of an integrated system for its regulation, includ-ing necessary legislation, legal sanctions, and regular monitoring (paras1.06 and 8.01).

I. SUMMARY AND CONCLUSIONS 1/

Identification, Preparation and Appraisal

1.01 The Project was identified in 1972, prepared in early 1975, appraisedin 1976, and completed on December 31, 1982. 2/ Credit 724-BD was signed onJuly 1, 1972, became effective on December 9, 1977, and closed December 31,1982. 3/ The main objectives of the Project were to increase foodgrainproduction in Northwest Bangladesh and to strengthen institutional servicescomplementary to this goal. The Project had four components carried out overfour years: (a) sale and installation of 10,000 STWs on cash and credit, (b)credit facilities through nationalized commercial banks (NCBs) to eligibleIRDP groups and individuals, (c) upgrading repair and maintenance facilitiesfor all irrigation equipment in the NW, and (d) evaluation studies forassessment of project benefits and effectiveness of repair and maintenancefacilities. The Project was to be carried out principally by three agencies:BADC, IRDP, and two NCBs (Sonali and Janata). For effective coordination,the Project's organizational structure was to include three executivecommittees at Project, district and thana levels, as well as a coordinationcommittee at ministerial level.

Implementation

1.02 Due mainly to initial procurement problems, implementation took over1.5 years longer than originally expected. However, appraisal targets ofSTWs sold were eventually exceeded by 10% with installation of 11,000 wells.This was made possible by developing and following a farmers' choice proce-dure (paras 5.02-5.03). However, due to difficulties in organizing eligibleIRDP groups, sale to IRDP groups fell short of the appraisal estimate (39%vs. 60%). Cash sales also did not meet expectations, but NCB credit sales toindividuals were about double that of appraisal estimates (58% vs. 30%).Although implemented behind schedule, civil works of the regional workshop atBogra, five zonal workshops and 80 thana workshops were completed by December1982. However, only about 50% of expected tools and equipment for variousworkshops was obtained. Evaluation studies for assessment of Projectbenefits and socio-economic characteristics of beneficiaries have also beencompleted, but behind original schedules due to change of consultants.Various reports of a workshop management consultant have also been finished.Reflecting (a) changes in Project content with respect to workshops,machinery and equipment, as well as (b) GOB's restrictions on import of

1/ This report incorporates comments received from GOB on an earlier draft.

2/ Actual Project completion was about 18 months later than appraisalestimate (June 1981).

3/ Credit closing was extended (telex, December 23, 1981) by one year fromits original date of December 31, 1981. GOB has recently advised IDAthat the undisbursed balance in the Credit (US$ 1.8 M) may be cancelled.

vehicles, and (c) taka devaluation over the course of implementation, totalProject cost (US$21.5 M) was 15% less (in US$) than appraisal expectation(US$25.4 M), and Credit disbursements up to May 16, 1983 were US$ 14.2 M, outof the original allocation of US$ 16.0 M.

1.03 Agricultural Impact. Compared with an appraisal estimate of 10,000STWs irrigating 150,000 ac @ 15 ac/well, 11,000 STWs were actually installedby 1982-83, irrigating about 118,000 ac @ 10.73 ac/well on average. At fulldevelopment, expected in 1988-89, these 11,000 STWs are anticipated toirrigate a minimum of 140,000 ac @ 12.73 ac/STW on average. Cropping inten-sities increased from 133% (without-project) to 176% (-ith-project) by1982-83, against appraisal expectation of 144% to 176%; by fual developmentit is expected to reach 180%. Incremental foodgrain optduction of 92,000metric tons, comprising 40,000 tons of rice and 52,000 tons of wheat, wasprojected at appraisal. By 1982-83 this reached about 102,000 tons, compris-ing only rice. At full development, some reduction in rice is now expectedwith a corresponding increase in wheat, and incremental foodgrains of 120,000tons are anticipated consisting of 80,000 tons of rice and 40,000 tons ofwheat. Farmers in the Project area are expected by full development torealize about 95% increase in farm incomes on average. In addition, about6.4 M mandays of employment is currently being generated with the Project,which is anticipated to rise to 7.8 M mandays by full development.

1.04 Economic Impact. The Bangladesh economy is projected to realize a46% ERR on Project investments, in contrast to 48% estimated at appraisal.Economic returns are expected to remain highly attractive even with no fur-ther cropping pattern changes into the future. These results confirm themerit of GOB's emphasis on STWs for irrigation sector development.

1.05 Borrower and IDA Performance. GOB's performance in carrying out itsobligations under the Project generally was satisfactory. IDA supervisionwas regular and done with a high degree of staffing continuity.

1.06 Lessons Learned. The STW Project was well conceived and is con-sidered generally a success. The Project would be suitable for replicationwith the following suggested modifications, some of which were introducedduring implementation: (a) allowing farmers' choice of equipment; (b)streamlining procedures for processing STW applications; (c) providingsimpler application procedures for credit from NCBs; and (d) encouraging moreprivate sector participation in repair and maintenance activities. Grouppurchase has been less successful under the Project; on equity grounds,therefore, it would be desirable to give increased attention to design of afuture project to ensure group purchase and equitable and productive use ofshared equipment. The Rural Development (RD) I Project (Cr.631-BD) and the

DTW II Project (Cr. 1287-BD) with their IrrigatieLr Manageu.ent erogramapproach 1/ could provide some guidance for such design adjustments. Howeverpractical problems involving, inter alia, socioeconomic power imbalances atvillage-level and the difficulties in group formation and cooperation, in itstrue sense, are definite constraints to rapid expansion of IMP or similarprograms. These grassroots constraints should be recognized and well under-stood. The Project's revolving fund, initially established by GOB at Tk 4.5M, was an asset to the Project but should be enlarged in any future project;such enhancement, however, may prove difficult in view of GOB resourcelimitations. The possibility of avoiding proliferation of project-specificadministrative committees should be examined, and the feasibility ofstrengthening existing, more general agricultural and rural institutions forimplementation should be explored. Lastly, and perhaps most importantly,a future STW project should be implemented with prerequisite regulation ofgroundwater development, supported by necessary legislation, legal sanctions,and regular monitoring of groundwater exploitation. The need for suchregulation is recognized within GOB as evidenced by some very recent prelimi-nary codification of groundwater development regulations.

II. BACKGROUND

2.01 The Bangladesh economy depends heavily on agriculture. The agricul-tural sector accounts for about 55% of GDP, 70% of the labor force, and over80% of all exports. Moreover, much of its industrial output comes fromprocessing agricultural produce or producing inputs for use in agriculture.Rice is by far its most important crop, accounting for about 78% of croppedarea, followed by jute (6%) and a variety of other crops such as pulses,oilseeds, wheat, sugarcane and vegetables (16%).

1/ One of the main reasons for underutilization of minor irrigation equip-ment is the poor organization and management of user groups. To remedythis problem, the Irrigation Management Program (IMP) was introducedfirst under the RD-1 Project in 1979-80. BADC, IRDP, and Department ofAgriculture (Extension) officers at district and thana levels are jointlyresponsible for implementing IMP which aims at increasing the commandarea per unit of irrigation equipment and thus reducing irrigation costs.The essential features of IMP are, inter alia: (a) preparation of actionplans; (b) organization of KSS meetings to explain the utility of watermanagement; (c) training of managers, model farmers and chairpersons ofKSSs, TCCA inspectors, village accountants, block leaders, fieldmen, andtubewell operators; (d) laying of proper irrigation channels; and (e)preparation of irrigation budgets. IMP proved very successful when firstimplemented on a limited scale under close supervision, and is intendedfor gradual replication nationwide, currently underway for DTWs and LLPs.Limited cooperative spirit and disputes involving compensation for fieldchannel realignments (land and labor), however, have slowed progress incertain areas.

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2.02 During the 1960s, agricultural production grew at an annual rate ofabout 2.5% and foodgrain production at 2.4%, both lagging behind populationgrowth of about 3% p.a. As a result, foodgrain imports increased from 0.6 Mtons in 1960-61 to 1.5 M tons in 1969-70. Severe drought coupled with thedisruptions caused by the 1971 liberation war resulted in sharply reducedproduction in 1972-73 necessitating food imports of 2.8 M tons. Despitesubstantial recovery over the next decade, Bangladesh still has had to importon average about 1.6 M tons of foodgrains annually.

2.03 Agricultural development in Bangladesh is constrained by scarcity ofcultivable land, limited potential on a large part of cultivable land, a longdry season from November to March, the small and fragmented nature of farmholdings and climatic vagaries. On the positive side, Bangladesh has largeareas of highly fertile deltaic soils, a tropical climate suitable foryear-round cropping, some surface water and abundant groundwater resourcesfor dry season irrigation. The need to maintain minimum flows in riversduring the dry season limits the potential for surface water irrigation, butconsiderable groundwater potential still remains to be developed. Two kindsof tubewells are used in Bangladesh--deep tubewells (DTWs) and shallowtubewells (STWs). In 1978-79 only about 9,000 DTWs and 7,000 STWs were inoperation, irrigating about 0.37 M ac. In contrast, by 1980-81 about 11,500DTWs and 24,000 STWs were in operation, irrigating about 0.91 M ac. Comparedto DTWs, STWs are simpler to install and maintain, require much smallerfarmer groups for optimal utilization, and are considerably less expensive.Accordingly, GOB has shifted priority to STWs wherever possible. GOB's majoragricultural development objectives are to achieve self-sufficiency infoodgrains, create employment for the rural poor, and to increase exportearnings. The strategy adopted emphasizes strengthening rural institutions,better utilization of existing irrigation facilities and further expansion ofirrigation through low-cost, short gestation, minor irrigation schemes. TheShallow Tubewells Project was designed in consonance with these objectives.

2.04 Bangladesh has received IDA assistance for various agriculturaldevelopment projects, several of which relate to water resource development.Prior to independence, two IDA-financed water control projects were com-pleted. Since independence more water development projects have beencompleted--e.g., Chandpur II Irrigation Project (Cr. 340-BD), NorthwestTubewells Project (Cr. 341-BD), and the Shallow Tubewells Project(Cr. 724-BD). In addition to the latter projects, six additional irrigationprojects are currently being implemented that include distribution of minorirrigation facilities: Low Lift Pump Project (Cr. 990-BD), Hand TubewellsProject (Cr. 1140-BD), Deep Tubewells II Project (Cr. 1287-BD), BarisalIrrigation Project (Cr. 542-BD), Karnafuli Irrigation Project (Cr. 605-BD),and Muhuri Irrigation Project (Cr. 725-BD). Also, the RD-I Project (Cr.631-BD) and the Agricultural Credit I Project (Cr. 1147-BD) provide financefor small-scale schemes.

2.05 This report is based on a draft completion report prepared by theEconomics Department of the Rajashahi University under contract with BADC,the findings of a limited follow-up IDA mission in 1983, and a review of IDAfiles.

III. IDENTIFICATION, PREPARATION AND APPRAISAL

3.01 The Project was identified as part of the 1972 Land and WaterResources Survey ("Nine-Volume Study") conducted by IDA and was preparedby BADC in 1975. Following the priority given to STWs, by 1976 GOB hadapproved, or was considering, proposals for installation of an additional35,000 STWs over the next 4-5 years--2,500 under the IDA-financed RD-1Project, 5,500 under the ADB-financed Agricultural Credit Project, 17,000under bilateral assistance from Japan, Germany and India, and 10,000 underthe IDA STW Project. An IDA mission visited Bangladesh in February 1976 toappraise a proposed STW project, and a follow-up mission, in August-September1976.

3.02 The major objectives of the Project were to (a) increase foodgrainproduction, (b) improve farm income levels, (c) rationalize and strengthenrural institutions, and (d) improve utilization of existing investments inirrigation facilities. The Project was in consonance with the strategy setforth in the Bangladesh Land and Water Resources Sector Study by the BankGroup in 1972 that emphasized the advisability of groundwater developmentwhere surface water resources were not readily available.

3.03 In view of the concurrent operations of other projects involvinggroundwater development (e.g., BADC's on-going program of "hire purchase"for sale of tubewells on credit, IDA's RD-1 Project, and ADB's AgriculturalCredit Project through Bangladesh Krishi Bank (BKB)), issues that aroseduring appraisal were (a) appropriate geographical areas to be covered underthe Project, (b) institutional arrangements for sale of STWs and provision ofcredit to farmers, (c) feasibility and consistency of GOB's overall programfor STW development, (d) scope of the project, and (e) cost recovery forirrigation. The following formulations were agreed to during appraisal andnegotiations by GOB and IDA:

(a) To benefit relatively poorer zones and to increase foodproduction in food-deficit areas in the NW, the Projectwould cover all areas with technically acceptable groundwaterpotential rather than be limited only to areas with optimalpotential;

(b) To strike a balance between the objectives of growth, equity,and institution building, distribution of Project-financedtubewells would be through three channels: (i) cash sales byBADC, (ii) sales to IRDP groups with credit from nationalizedcommercial banks (NCBs), and (iii) sales to individuals onCB credit with larger downpayments and stricter securityarrangements than for IRDP groups. All three channels were tooperate in parallel. To ensure participation by small farmers,5,000 STWs would be reserved initially for IRDP groups. It wasagreed further that institutional arrangements and terms and

conditions for sale of Project-financed STWs would be satis-factory to IDA and that by end-December 1977, BADC would phaseout its hire-purchase system for STWs on a countrywide basis;

(c) After reviewing the feasibility and consistency of the overallprogram for the total proposed 35,000 incremental STWs, itwas agreed that uniform pricing principles should be followedfor all STWs installed in the Project area, irrespective offinancing source and procurement method. GOB also agreedto establish an expert committee to review the issue ofgroundwater development in Bangladesh, and submit to IDA forreview not later than December 31, 1979 its proposals forregulation of groundwater development; 1/

(d) Since an Extension and Research Project was anticipatedfor the NW, 2/ the Project would include only servicesessential for the successful operation of Project STWs,i.e., strengthening of repair and maintenance facilitiesfor irrigation equipment in the NW; and

(e) While there were no subsidies on STWs, other modes ofirrigation (low lift pumps, deep tubewells, and gravityirrigation), often existing side-by-side with STWs, werestill heavily subsidized. Therefore during Credit nego-tiations, the IDA delegation emphasized concern aboutlack of a consistent GOB policy for cost recovery undervarious irrigation schemes currently under implementation,and proposed an additional covenant requiring GOB byDecember 31, 1978 to submit to IDA a comprehensive plan torecover O&M costs and as much capital costs as possible forall irrigation facilities, and a timetable for implementa-tion of this plan. However, it was agreed eventually thatGOB would only prepare and submit to IDA for comment a costrecovery plan with respect to irrigation facilities and

1/ While no such expert committee was ever established, the covenant waspartially met for the NW by extension of the groundwater model preparedby Sir M. MacDonald and Partners Ltd. originally prepared under theNorthwest Tubewells Project. In the original exercise, the extent ofgroundwater in the aquifers was analyzed, a groundwater model developed,and exploitation potential determined. Later, to incorporate STWs, themodel was modified by refining hydrologic units into smaller areas. GOBauthorities unfortunately have failed to utilize the study results toregulate groundwater exploitation or to formulate legislation for thispurpose. Similarly, model results have not been updated since requisitethana irrigation maps have not been kept current.

2/ Two such projects were established (Cr. 729-BD and Cr. 828-BD). Thefirst was concentrated in NW; the second had nationwide scope.

schemes under BADC purview. 1/ Regarding those carried outby other agencies, the GOB delegation agreed to convey IDA'sconcern to higher authorities.

3.04 The project was approved by the IDA Board of Directors on June16, 1977. The Credit was signed on July 1, 1977 and became effective onDecember 9, 1977.

IV. THE APPRAISED PROJECT

4.01 Project Description. The Project was designed to provide irrigationto about 150,000 acres, and repair and maintenance facilities for irrigationfacilities in NW Bangladesh. It included four basic components:

(a) Installation of STWs. Provision of equipment, materials andspare parts for installation of 10,000 power-driven STWs andabout 500 standby pumpsets, and preparation of thana irrigationmaps, including groundwater investigation where necessary;

(b) Credit Facilities. Provision of credit through two NCBs,Sonali and Janata, to eligible IRDP groups and individualsfor financing purchase of about 9,000 STWs--an estimated 6,000by IRDP groups and the balance by individuals; provision ofvehicles and office equipment for IRDP, TCCAs, and the NCBs;completion of an inventory of all overdue and outstandinginstitutional debt owed by members of KSSs; and preparationof land registers for KSSs;

(c) Repair and Maintenance Facilities. Servicing infrastructurefor existing and proposed irrigation equipment in the NW,including construction and equipping one regional workshop(Bogra), five zonal workshops and about 100 thana workshops;provision of a workshop management expert; equipment forprivate workshops; and vehicles for BADC field staff;

(d) Monitoring and Evaluation. Carrying out Project evaluationstudies to assess (i) direct and indirect economic and financialbenefits derived from Project-financed STWs, (ii) socio-economiccharacteristics of beneficiaries, and (iii) effectiveness ofimproved repair and maintenance facilities.

4.02 Cost and Financing. Total Project cost was estimated at US$ 25.4 M(Tk 381 M at an exchange rate of US$1 = Tk 15), including about US$ 4.6 M inimport duties and taxes but excluding any incremental administration and

1/ No such report was ever submitted. However, BADC has agreed underImports Program Credits to phase out all rentals by end-FY84 (exceptDTWs) and to institute full-cost pricing (except DTWs).

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supervision costs. Foreign exchange costs were estimated at US$ 14.6 M, orabout 57% of total costs. Cost estimates were based on March 1977 pricelevels. Originally estimated Project costs and financing plan are summarizedbelow:

ORIGINAL PROJECT COST ESTIMATE AND FINANCING PLAN(US$ M)

Local Foreign Total

Base Cost

1. Equipment and Materials 5.84 8.54 14.38for STWs, including standbypumpsets and spares

2. Vehicles and Office 0.14 0.22 0.36Equipment for IRDP and CBs

3. Civil Works for 0.89 0.30 1.19Workshop Facilities

4. Machinery and Handtools 1.49 2.65 4.14for Workshops, andVehicles for BADC

5. Technical Assistance 1.49 0.26 0.73

Total Base Cost 8.83 11.97 20.80

Physical Contingencies 0.40 0.45 0.85

Price Contingencies 1.57 2.18 3.75

Total Project Cost 10.80 14.60 25.40

Project Financing (US$ M Equivalent)

Domestic Financing(a) Buyers of STWs 5.3(b) Janata & Sonali Banks 2.6(c) IRDP-TCCAs 0.1(d) Private Sector Workshops 0.4(e) GOB 1.0

9.4IDA 16.0

Total 25.4

4.03 The IDA Credit of US$ 16.0 M was to cover full foreign exchange costsand a portion of local costs, or about 77% of the total net of taxes andduties. The balance (US$ 9.4 M) was to be financed from domestic sources.

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To ensure availability of funds for prompt payment of local expenditures, itwas agreed that GOB would establish and maintain a Project Revolving Fundwith an initial contribution of Tk 4.5 M (US$ 0.3 M). The fund would bereplenished from: (a) IDA reimbursements against project expenditures, (b)BADC receipts from cash sales of STWs and spare parts and rental of standbypumpsets, (c) payments from IRDP-TCCAs and NCBs for purchase of vehicles andoffice equipment, (d) contributions by NCBs for financing their share ofcredit STW purchase, and (e) downpayments and installation payments (net ofrepayments to NCBs) by farmers for tubewells purchased on credit.

4.04 Conditions of Credit effectiveness were that GOB approve a con-solidated Project Proforma (PP) and that it establish the revolving fund andmake an initial contribution of Tk 4.5 M.

4.05 Management and Organization. Project implementation was to involvethree principal agencies:

(a) BADC would have responsibility for procurement, installationand after-sales servicing of Project-financed STWs, and enhancedrepair and maintenance facilities for all irrigation equipmentin the NW. For regional and zonal workshops, BADC was to beresponsible for design finalization, tender document preparation,contract awards, construction supervision and workshop equipmentprocurement;

(b) IRDP would have charge of organizing farmer cooperatives forcredit sales to groups, and administering and supervising creditto TCCA-KSSs; and

(c) Janata and Sonali Banks would provide credit to individual andgroup buyers. These NCBs were also to have sole responsibilityfor administering and supervising lending to individuals and tohelp IRDP in this regard for group credit. In addition, theMinistry of Land Administration, Local Government and RuralDevelopment and Co-operatives (MLGRD&C) was to participatein project implementation by supervising construction/comple-tion of thana workshops, helping to verify of credit recordsof borrowers under the Project and providing project coordi-nation through local governments in the field.

4.06 GOB provided assurances that an adequate number of additional staffwould be assigned to the various implementing agencies. It also gaveassurances that it would make adequate budgetary allocations to BADC andIRDP for proper O&M of buildings, vehicles, and equipment used in the Projectand for importation of spare parts necessary for maintenance of irrigationequipment.

4.07 Successful project implementation necessitated close coordinationamong BADC, IRDP, and the NCBs. The organizational structure to achievethis was modelled after that used in the RD-1 Project. The Project proposedto have three levels of executive committees--thana, district and the

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Project--each with defined composition and functions. In addition, a ProjectCoordination Committee (PCC) was proposed at ministerial level.

4.08 Benefits. It was expected that the Project would enable increasedcropping intensity and a shift from low-yielding, risky rainfed crops torelatively low-risk, high-yielding irrigated crops. Three land use patternswere distinguished according to ecological zones based on flood depths:

(a) Zone I: Deep flooded area, dominated by Broadcast Aman paddy.

(b) Zone II: Shallow flooded area, well suited for transplantedAman, but poorly suited for jute and Aus.

(c) Zone III: Medium shallow flooded area well-suited for T. Amanas well as for jute and Aus.

In Zone I cropping intensity was expected to decline from 135% to 120%reflecting an anticipated shift from Aus/B. Aman and pulses to Boro paddy.In the other two cases, it was to increase significantly: from 110% to 200%and 160% to 200%. Paddy would continue to dominate the cropping patterns;however, there would be considerable change in the relative weights of dif-ferent crops. Wheat production was to increase significantly, and irrigatedHYV Boro would become the main paddy crop. Boro paddy was expected atappraisal either to replace B. Aman or Aus, or to be an additional crop onformerly dry season fallow land. With relatively cooler climate and morepermeable soils in the NW, the Project was also expected to induce a substan-tial increase in irrigated wheat. Pulses and oilseeds grown as catch-cropsusing residual moisture in the dry season were expected to be replaced byvegetable crops, e.g., chillies, potatoes, brinjals and tomatoes. Supplemen-tary irrigation during the wet season was also expected to cause a shift fromlocal to HYV T. Aman. The Project was expected to bring under irrigation anadditional 150,000 ac formerly producing mainly a single crop under rainfedconditions. This irrigation expansion was projected to generate an addi-tional 40,000 tons of rice and 52,000 tons of wheat.

4.09 The more intensive land use with-project would create incrementalfarm labor demand of about 7.5 M mandays p.a., an increase of about 60% overthe pre-project level. With secondary employment effects, total employmentwas projected to increase by 10-11 M mandays. Landless laborers wereexpected to benefit most significantly. Emphasis was also given to institu-tional development to assist small-medium farmers as well as farmer-groups.Overall, about 40% of land expected to receive irrigation with-project wasanticipated to be operated by farmers then below subsistence levels, andtwo-thirds of farm families directly benefitting to then have incomes belowsubsistence levels.

4.10 The economic rate of return (ERR) to Project investments wasestimated at about 48%. Separate analyses with different cropping patternsand ownership arrangements indicated that all such cases would be economi-cally viable, the lowest return being about 35%. Sensitivity tests carriedout under a variety of unfavorable assumptions resulted in ERRs of over 30%.

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Thus, the Project was found to be feasible technically and highly attractivefinancially and economically. High expected returns were expected essen-tially because of two factors: a low unit investment cost and short gestationperiod. High economic returns, coupled with large unexploited groundwaterresources, made STWs among top priority investments for agriculturaldevelopment.

V. THE IMPLEMENTED PROJECT

5.01 Project Start-Up. There was some delay in GOB approval of BADC'sProject Proforma (PP), one of the Credit effectiveness conditions. Accord-ingly, the Credit was declared effective only on December 9, 1977 instead ofon September 30, 1977 as originally intended. The Project had a fairlysatisfactory start with respect to tender document preparation for STWengines, pumps, and accessories and to preparation of thana irrigation maps.ICB STW tenders were floated in March 1978; however, due to procurementproblems discussed below, actual procurement and installation of STWs startedonly from 1979-80, instead of from 1977-78, and was completed in 1981-82instead of 1980-81 as per the appraisal plan.

5.02 Procurement and Sales of STWs. Procurement and sales of STWs laggedfar behind the original implementation schedule. However, total sales even-tually exceeded original targets as shown below:

Procurement and Sales of STWs

1977-78 1978-79 1979-80 1980-81 1981-82 Total

Procurement

Appraisal estimate 1,000 3,000 3,000 3,000 - 10,500 /aActual - - 2,000 8,500 550 11,050 7a

Sales

Appraisal estimate 1,000 3,000 3,000 3,000 - 10,000Actual - - 829 4,810 5,361 11,000

/a Includes standby pumpsets: appraisal, 500 and actual, 50.

STW procurement delays were caused by failure of the ICB floated in March1978 when none of the 62 engine/pump combinations offered by 47 bidders wereconsidered responsive by either BADC or IDA. To accelerate implementation,IDA subsequently suggested, and BADC accepted, a procedure whereby BADC wouldprocure through prudent shopping an initial 1,500 STWs (later raised to3,000) with spares and accessories, provided that these purchases (a) con-sisted of 4-5 makes of STWs then operating satisfactorily in Bangladesh and(b) encompassed a sufficiently wide price range to give farmers a choicebetween lower cost/higher maintenance and higher cost/lower maintenancepumpsets.

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5.04 To procure the remainder, GOB set up a committee chaired by theSecretary, MLGRD&C, that ranked STW sets already in operation as well as newsets deemed technically suitable. This ranking was based on tested perfor-mances of different pumps, taking into account comparative investment andoperating costs of different pump/engine combinations then operating inBangladesh as well as of new ones considered technically satisfactory. IDAsubsequently endorsed the selection committee's approach, and types andnumbers were agreed upon. A farmers' choice procedure was then developedunder which BADC first would obtain firm quotations for selected types sixmonths ahead of delivery and then immediately prepare and distributebrochures containing descriptions and prices and inviting applications fromfarmers. Farmers were then to indicate three preferences with applicationsand to include downpayments of Tk 2,000/STW from groups and Tk 4,000 fromindividuals. Based on farmer choice survey results, BADC placed orders, andthereafter procurement progress was satisfactory.

5.05 In total, 11,050 sets were finally procured and 11,000 sold andinstalled, leaving 50 standby pumpsets, as against an appraisal estimate of10,500 procured, 10,000 sold, and 500 for standby.

5.06 Actual distributions of STWs by sales mode and district were asfollows:

Cash Credit from NCBs TotalIndividuals Individuals IRDP Groups

DistrictRajshahi 5 4,198 - 4,203Pabna 114 773 1,940 2,827Bogra 78 873 1,042 1,993Rangpur 39 463 945 1,447Dinajpur 66 115 349 530

Total 302 6,422 4,276 11,000

Percent 3 58 39 100

Appraisal Estimate a/ 1,000 3,000 6,000 10,000

Percent 10 30 60 100

/a No district breakdown was given at appraisal.

While cash sales to individuals and credit sales to IRDP groups ultimatelyfell short of appraisal estimates, NCB credit sales to individuals far sur-passed expectations. It should be noted, however, that the appraisal didnot make any firm allocations between the three sales channels (para 3.03(b)), allowing them to operate in parallel with actual allocations determinedby actual demand. IRDP group sales were disappointing due mainly to dif-ficulties in organizing required groups within the limited time. Moreover,many "groups" acquiring STWs proved in fact to be individuals and extendedfamilies. On the whole, however, the overall program of STW sales, although

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behind schedule, must be considered generally satisfactory. The Projectsuccessfully introduced NCBs as creditors for STW purchase and, judging fromthe larger sales percentage to individuals with credit, it is likely that infuture more farmers will come to NCBs for similar credit requirements. Thismust be reviewed as a major institutional achievement of the Project.Through November 1982, 8,760 applications had been received by NCBs for loanstotalling Tk 182.2 M, almost all of which were eventually sanctioned.However, reports of lengthy and complicated procedures for obtaining creditfrom NCBs, and of lack of sufficient experience on the part of bank loanofficers merit attention and correction in future, if valid. Unfortunately,preliminary indications are as well that overdues are developing, in linewith the general, chronic problem in the rural credit sector.

5.07 Preparation of Thana Irrigation Maps. All necessary boring andtesting were done expeditiously and results incorporated into the maps usedto facilitate site selections. All 69 thana irrigation maps were completedas planned, but now these need updating with additional recordings of LLPs,DTWs, as well as STWs.

5.08 Construction of Workshops. The Project was to enable completion ofconstruction of the partially completed regional workshop at Bogra and con-struction/development of five zonal workshops by May 1979. However, duechiefly to lack of coordination among different BADC Irrigation Directoratedivisions this Project component stagnated for some time. All workshops wereadministered by the M4echanization and Pumps (M&P) Division, also responsiblefor LLPs but not STWs or DTWs, whereas the STW Division was responsiblefor Project implementation. Delays were also caused by initialnon-availabilities of estimates for repair and renovations, problems in siteselection (Dinajpur), and temporary occupancy of the Bogra regional complexby army personnel. Progress was made only after decisions were taken that(a) M&P would continue to operate workshops and (b) funds would move from STWto M&P to complete civil works and equipment purchases. Although behindschedule, civil works on the regional workshop, five zonal workshops, and 80of the 100 thana workshops were completed by December 1982. Out of 19planned fuel storage tanks, civil works on 13 were completed; however,because of high costs involved, construction of the remaining six fuel tanksand 20 thana workshops was dropped ultimately from the Project.

5.09 Procurement of Machinery and Equipment. To strengthen repair andmaintenance facilities for all irrigation equipment (LLPs, DTWs and STWs) inthe NW, the Project was to provide incremental machinery, equipment and handtool requirements for the Bogra Regional Workshop, five zonal workshops, andabout 100 thana workshops. A lump sum provision was also made for import ofmachinery and hand tools for sale to private sector workshops. ReflectingGOB's increased emphasis on privatization, the Project was later revised toprovide incremental machiaery, equipment and handtool requirements only forthe Bogra Regional Workshop, and incremental equipment for the zonalworkshops was dropped. In addition, zonal workshops proved not to haveenough skilled manpower to effect repair and maintenance since many staffleft for Middle East jobs. Procurement for tools and equipment for privatesector workshops for six district and 12 sub-divisional units was started,but progress was slow due to procedural changes by BADC. Some suppliers

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refused to deliver goods ordered. Out of 18 private workshopowner-applicants, eight took back downpayments due to delay in equipmentprocurement. The remaining ten private workshops owners are now gettingloans for equipment under the Agricultural Credit Project (1147-BD) directlyfrom the Bangladesh Bank/NCBs. About 250 toolboxes were to be sold totrained mechanics. About 200 toolboxes were procured, but coula not bedistributed due to high prices and to inability to arrange credit with NCBs.Therefore, these toolboxes were retained by BADC for use by its ownmechanics. On balance, about 50% of the original workshop machinery,equipment and tools has been procured and put in use.

5.10 Repair and Maintenance. To strengthen repair and maintenance serv-ices, BADC planned to employ an additional 125 mechanics and 375 assistantmechanics during the Project period; but due to GOB restrictions on newappointments up to end-December 1982, none could be hired. However, BADCreports that after retraction of this hiring embargo for "Core Projects,"most remaining positions were filled. About 250 private practicing mechanicshave also been trained in BADC zonal workshops. Of the total trained, morethan 50% (131) were recruited through IRDP and the rest, through BADC.

5.11 Vehicles and Office Equipment. Procurement of office equipment forBADC has been completed, but due to delay in indent processing and subsequentGOB embargo on purchase of vehicles, the vehicle procurement target could notbe fully achieved. Out of 31 pickups proposed, none could be procured andonly some jeeps and 3-ton trucks were purchased. In total, 24 vehicles, 80motorcycles and 500 bicycles were procured, against an appraisal estimateof 74 vehicles, 135 motorcycles and 800 bicycles. Out of these totals, twovehicles, 40 motorcycles, and 320 bicycles were supplied to IRDP. GOB'sgeneral restriction on procurement of vehicles was a principal cause ofprocurement shortfalls. However, vehicles and equipment provided from otherassistance, e.g., RD-1 Project, compensated to some extent for these short-falls, and implementing agencies seemed to experience minimal hindrance totheir operations under the Project.

5.12 Project Evaluation Studies. Monitoring and evaluation were con-sidered an integral part of the Project. Initially, Bangladesh Instituteof Development Studies (BIDS) was selected to undertake Project evaluationstudies assessing direct and indirect economic and financial benefitsderived from Project-financed STWs and socio-economic characteristics ofbeneficiaries. BIDS agreed to submit its report by December 1981. Unfor-tunately, after a lapse of one year, they informed of their inability to dothe work and later an offer was obtained from Rajshahi University. With IDAapproval, detailed TORs were prepared, and it was agreed that the finalevaluation report would be submitted by end-December 1982. A consultant fromthe University submitted his report within this deadline.

5.13 Technical Assistance. To help in implementation of the repair andmaintenance improvement program in the NW, a Workshop Management Expert wasto be hired for two years. Accordingly, a consultant was appointed asWorkshop Management Consultant in March 1978, initially for 24 months andwith later extension to 58 months (upto December 1982). His assignments wereto: (a) check existing layouts of completed workshops, (b) review sites and

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layouts for proposed regional and zonal workshops, (c) prepare a detailedwork program for construction completion of various workshops, procurementsand installation of workshop equipment, recruitment of additional staff,etc., (d) delineate responsibilities for workshops at thana, zonal andregional levels, and (e) advise on keeping of stores and inventories. Theconsultant performed his assigned duties satisfactorily and submitted regulardetailed reports with useful suggestions.

5.14 Costs and Financing. Chiefly as a result of changes in Projectcontent as described above, total cost decreased from the appraisal estimateof Tk 381 M (US$ 25 M equivalent @ US$1 = Tk 15) to Tk 368.4 M (US$ 21.49 Mequivalent at a weighted average exchange rate of US$1 = Tk 17.145). IDAdisbursement up to June 1983 was US$ 14.2 M, against the Credit allocation ofUS$ 16.0 M. Local contribution was US$7.3 M equivalent, against an appraisalestimate of US$9.40 M. Both appraisal estimates and actual expendituresshown below exclude incremental administration and supervision costs borne byGOB, equivalent to about US$ 2.24 M. A summary table is given below; detailsof public expenditures are in Annex 2.

Estimated and Actual Project Cost & Financing

Taka M- US$ M Equivalent /aAppraisal Actual/b Overrun Appraisal Actual/b Overrun

1. STWs 267.9 294.9 27.0 17.86 17.20 -0.662. Machinery, handtools

for workshops andvehicles 76.3 49.5 -26.8 5.09 2.89 -2.20

3. Civil works forworkshops 24.0 17.1 -6.9 1.60 1.00 -0.60

4. Technical assistance 12.8 6.9 -5.9 0.85 0.40 -0.45

Total 381.0 368.4 -12.6 25.40 21.49 -3.91

Foreign Exchange Cost 219.0 175.6 -43.4 14.6 10.24 -4.36

Local Cost 162.0 192.8 30.4 10.8 11.25 0.45

IDA Financing 16.0 14.16 -1.84

Local Financing 9.4 7.33 -2.07

/a Exchange Rates: Appraisal: US$1 = Tk 15Actual Average: US$1 = Tk 17.145

/b Includes an estimated US$2.09 M equivalent for STW downpayments andUS$ 0.58 M equivalent for STW sinking, both borne by private sector.This largely accounts for the difference between the Actual Cost ofTk 368.4 M given in this table and that reported by GOB and presentedin Annex 2. The former has been based on credit disbursements in US$converted into taka at prevailing exchange rates.

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5.15 Disbursements from Credit proceeds by category were as follows:

Estimated and Actual Disbursements(US$ M)

Appraisal Actual % of Appraisal

1. STWs 9.0 11.60 1292. Equipment & Vehicles for 0.2 - -

IRDP & CBs3. Machinery & Handtools for 2.8 1.68 60

Workshops & Vehicles for BADC4. Workshop Construction 0.8 0.70 875. Technical Assistance 0.4 0.18 456. Unallocated 2.8

Total 16.0 14.16 88

VI. AGRICULTURAL IMPACT

6.01 Appraisal estimates of agricultural impacts, actuals in 1982-83, andcurrent estimates for full development in about 1988-89 are discussed below:

6.02 Irrigated Area. Appraisal estimates of STW distribution andirrigated area in different ecological zones, compared with actuals in1982-83 and current estimates for full development, are shown in detail inAnnex 3 and are summarized as follows:

STWs and Irrigated Area

Number of STWs Irrigated Area (ac)Installed Average Area/STW Total

Appraisal 10,000 15 150,0001982-83 11,000 10.73 118,000Full Development 11,000 12.73 140,000

Compared with the appraisal estimate of 10,000 STWs eventually irrigating150,000 ac @ 15 ac/unit, the 1982-83 Rajshahi University evaluation studyfound about 11,000 STWs installed and irrigating about 118,000 ac in 1982-83@ 10.73 ac/unit on average. This lower average rate of STW coverage wasmainly due to a large shortfall in Zone III (9.52 ac vs. 20 ac/STW estimatedat appraisal). At appraisal this zone was expected to experience increasedcultivation of irrigated wheat requiring much less water than Boro paddy;however, this wheat production did not materialize.

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Average Irrigated Area per STW by Ecological Zone (ac)

WeightedZone I Zone II Zone III average

Appraisal 13 10 20 151982-83 (Actual) 12.96 10.68 9.52 10.73Current Estimate forFull Development 12.96 13.11 12.52 12.73

In view of the rapid increase in irrigated wheat cultivation in adjacentareas and based on discussions with area farmers, at full development the11,000 STWs are now expected to irrigate a minimum of 140,000 ac @ 12.73 acper STW on average.

6.03 Cropping Patterns. At appraisal the Project was expected to increasecropping intensities and cause a shift from low-yielding, risky rainfed cropsto relatively low-risk and HYV irrigated crops. Paddy was expected to con-tinue to dominate cropping patterns, but there was to be considerable changein the relative importance of the various paddy crops. With the Project,irrigated HYV Boro would dominate and would be cultivated either as areplacement to B. Aman or Aus crops, or as an additional crop on landsformerly left fallow during the dry season. There was expected to be asubstantial increase in wheat cultivation with irrigation. The area underoilseeds and pulses, however, was to decrease considerably. Appraisalestimates of cropping patterns by ecological zone and for the whole projectarea are shown in Annex 4, actuals in 1982-83 in Annex 5, and currentestimates at full development in Annex 6. Comparisons are summarized below:

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Comparison of Cropping Patterns With- and Without-Project'000 Ac

Current FullActual Development

Appraisal (1982-83) Estimate

W/a W /a W W W W

Paddy

Aus (local) 19.0 - 50.7 32.2 59.5 35.2

Aus (HYV) 8.0 - 0.4 - 2.3 4.5B. Aman 40.5 9.0 23.9 7.5 23.9 7.5T. Aman (local) 79.0 73.5 28.8 31.6 39.0 30.7T. Aman (HYV) 26.0 31.5 3.7 6.2 11.4 20.2Boro (HYV) - 56.0 - 115.0 - 90.4

Subtotal 172.5 170.0 107.5 192.8 136.1 188.5

Other Crops

Jute 16.0 16.0 8.1 5.4 8.6 7.0Wheat 8.0 54.0 7.2 4.5 8.4 49.9Pulses & Oilseeds 19.5 9.0 22.7 5.1 26.0 5.5Vegetables - 15.0 12.0 0.6 7.4 2.0

Subtotal 43.5 94.0 50.0 15.6 50.4 64.4

Total Cropped Area 216.0 264.0 157.5 208.4 186.5 252.9

Net Area 150.0 150.0 118.0 118.0 140.0 140.0

Cropping Intensity 144% 176% 133% 176% 133% 180%

/a W = Without Project; W = With Project.

6.04 As envisaged at appraisal and based on comparisons ofProject-benefitted areas and adjacent areas not serviced by irrigation, Boro

paddy in fact replaced a large portion of Aus and B. Aman by 1982-83;however, wheat cultivation declined. As projected at appraisal, the area

under pulses and oilseeds also dropped, but cultivation of vegetableslikewise failed to develop, in large measure due to marketing constraints.Judging from the current trend of wheat cultivation in the NW, however, andin view of the fact that irrigation water requirements for wheat are halfthose of Boro paddy, is likely that at full development there will be somereduction of the present (1982-83) Boro paddy area and corresponding increase,in wheat. Accordingly at full development, Boro paddy is now expected tocover about 90,400 ac and wheat, 49,900 ac, while the relative importance of

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the other varieties of paddy and other crops would remain the same as in

1982-83.

6.05 Yields. Appraisal and current yields estimates (in m tons/ac) for

future with- and without-Project are shown below:

Crops Appraisal Current

_ W _ WPaddyAus (local) 0.45 0.45 0.45 0.49

Aus (HYV) 0.82 0.82 0.75 0.80

Broadcast Aman 0.45 0.52 0.45 0.49

T. Aman (local) 0.67 0.75 0.60 0.67

T. Aman (HYV) 0.97 1.12 0.95 1.10

Boro (HYV) 1.38 1.38 - 1.40

Other CropsJute 0.52 0.60 0.52 0.60

Wheat 0.56 1.04 0.65 0.90

Pulses & Oilseeds 0.22 0.22 0.30 0.30

Vegetables 2.61 2.61 2.60 3.00

6.06 Production. Incremental rice production of 40,000 tons (60,000 tons

of paddy) and 52,000 tons of wheat, totalling about 92,000 tons of foodgrains

were projected at appraisal (see Annex 7). In 1982-83 incremental production

amounted to about 103,000 tons of rice and -600 tons of wheat, totalling

102,000 net tons (see Annex 8). Current estimates for 1988-89 (full develop-

ment.) are specified in Annex 9 and are summarized below:

Current Estimates for Production at Full Development ('000 tons)

Incremental

w w (W- W)

PaddyAus (local) 26.8 17.2 -9.6

Aus (HYV) 1.7 3.6 1.9

B. Aman 10.7 3.7 -7.0

T. Aman (local) 23.4 20.6 -2.8

T. Aman (HYV) 10.8 22.2 11.4

Boro (HYV) - 126.6 126.6

Total Paddy 73.4 193.9 120.5

Other CropsJute 4.5 4.2 -0.3

Wheat 5.5 44.9 39.4

Pulses & Oilseeds 7.8 1.7 -6.1

Vegetables 19.2 6.0 -13.2

6.08 At full development incremental foodgrain production will reach about

120,000 tons, comprising about 80,000 tons of rice and about 40,000 tons of

wheat. Jute production should remain constant, while oilseeds and pulses

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should decline, as anticipated at appraisal; but in contrast to appraisalexpectations, vegetable production will decline.

VII. FINANCIAL AND ECONOMIC RESULTS

7.01 Impact on Farm Income and Employment. STW investments enabled areafarmers to switch from relatively low-yielding, risky rainfed crops to lowerrisk and HYV irrigated crops, as discussed above. These changes in croppingpatterns resulted in significant changes to farm incomes. Estimates of thesechanges are summarized below by ecological zone (para 4.08) for repre-sentative one-acre farms:

Without Project With Project Change----------------(Taka)…---------- …(%)-

Zone I 2,000 3,505 + 75Zone II 2,240 4,605 +105Zone III 2,035 4,240 +108

Lower estimated with-project returns for the representative Zone I farmerreflect the limited cropping possibilities in his deep flooded area duringthe monsoon season. To take full advantage of the Boro season for paddycultivation, he must forego most of his monsoonal paddy crops. Farmers inZones II and III are utilizing irrigation for cultivation of both Boro paddyand wheat as substitutes for less profitable oilseeds and pulses. Anestimated 118,000 farm families to-date have received irrigation capabilitythrough the Project; by full development this is expected to increase byabout 20%. Incremental annual employment estimated at 6.4 M mandays hasresulted thus far with the Project, which is expected to reach about 7.8 Mmandays by full development. This contrasts with 7.5 M mandays p.a.estimated at appraisal.

7.02 Socio-economic Impact. Several initial conclusions can be drawnabout the socio-economic impact of the Project and the characteristics ofProject beneficiaries. These are considered tentative and best presented asa qualitative summary, each meriting future investigation toward fullerunderstanding of grassroots dynamics:

(a) Based on the Rajshahi University evaluation study, it appears thatirrigating farmers consistently own and operate more land on averagethan non-irrigators, and try to acquire more land through leasingto take more advantage of STW technology.

(b) Group sales under the Project seemed to have failed, with mostownership "groups" either fictitiously formed or deterioratedbecause of intra-group friction.

(c) While the degree and impact of power concentration with STWmanager/owners remain somewhat unclear, these manager/owners tendto have higher literacy, larger holdings and significantly higher

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proportion of their holdings under STW schemes, relative to othergroup participants.

(d) Higher farm incomes from STW access have reduced the financialpressure on small and medium farmers to sell land, but, inaccordance with traditional patterns of increasing concentrationof wealth, large farmers are observed stll buying a largeramount of land.

(e) The price of irrigated land has traditionally been increasing more

rapidly than non-irrigated land in Bangladesh; however, such pricesrose dramatically in the first year of STW operation, only to haveslowed down in later years.

(f) While recent reports from NW STW groups under the AgriculturalCredit I Project indicate otherwise, no serious complaints ofgroundwater shortage attributable to STW installation werereceived in the evaluation study; a few isolated cases wereobserved, however, of HTWs and dugwells going dry due to STWinterference.

7.03 Appraisal Economic Estimates. The following assumptions, inter alia,were made at appraisal in estimating the Project's economic impact:

(a) STWs would have a useful life of seven years and no scrap value.

With a four-year implementation period, Project life would be11 years;

(b) All costs except price contingencies, taxes, and duties wereincluded in the economic analysis. Full maintenance facilitycosts to service all irrigation equipment in the NW wereincluded. A SCF of 0.75 was used to shadow local costs;

(c) Estimated annual economic costs of administration and supervisionof the credit program by CBs, IRDP, TCCAs and KSSs were included;

(d) Annual incremental crop production costs included irrigation O&M

costs; and

(e) Only increased production in the directly benefitted areas wasconsidered. Even though at the farm-level tubewell benefitswould start within six months of installation, to allow for time

taken for installation of equipment, a one-year lag was assumedbetween investment expenditures on tubewells and start ofbenefits. Conservatively, a one year lag was also assumedbetween expenses on crop inputs and benefits from farmproduction.

On the basis of assumptions described above, the Project's ERR was estimated

at about 48%. Separate analyses with different cropping patterns and owner-ship arrangements were also conducted, and all cases were found viable withthe minimum at about 35%.

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7.04 Current Economic Estimates. The recalculation of the Project'seconomic impact essentially follows appraisal report assumptions. Main dif-ferences are:

(a) The re-analysis more realistically assumes a useful life of sevenyears for an STW engine, ten years for a pump, and 20 years for atubewell. With two replacements of an engine and one replacement ofa pump, a STW unit would have a useful life of 20 years. As aresult of these and the above assumptions, the Project period wasredefined at 24 years; and

(b) Prices and Exchange Rates. All costs and benefits were expressedin constant 1983 US$. For the historical period, local and foreigncosts (excluding taxes and duties) were adjusted by an internationalprice index 1/ with local costs first adjusted to border basis byyear-specific standard conversion factors. 2/ Costs and benefitsexpressed in taka were converted to US$ at exchange rates prevail-ing. Projections of future commodity prices were based on latestBank forecasts 3/ to 1995 expressed in constant 1983 values. Annex11-A provides a summary of economic prices used in the recalcula-tions.

7.05 The Bangladesh economy is expected to realize a 46% ERR on Projectinvestments, based on re-analysis. This ERR estimate approximates well thatmade at appraisal. Assuming an Opportunity Cost of Capital of 12%, netincremental benefits of US$66.9 H equivalent in present worth (PW) terms areexpected from the entire Project period, or US$8.6 M on an annualized basis.The updated economic real flow for the Project is presented in Annex 11-B,with further detail of underlying assumptions.

7.06 As discussed in paras 6.03-6.04, current projections for fulldevelopment (1988-89) include reduction in paddy cultivated area, par-ticularly Boro, and concomitant increase in wheat. Water savings from thisprojected 25,000 ac reduction in HYV Boro paddy cultivation over currentwith-project levels are anticipated to enable additional cultivation of about50,000 ac of wheat. Two analyses were performed to test the sensitivity ofthe estimated economic impact of the Project to variation in this expecta-tion. First, actual (1982-83) with- and without-project cropping patternswere maintained into the future, and secondly, a full developmentwithout-project case and actual with-project case were assumed. In thelatter scenario, without Project investments Aus (local) and T. Aman areexpected to increase over current 1982-83 estimates (see para 6.03). Resultsare summarized below:

1/ Unit Value Index of Manufactured Exports (MUV).

2/ 1978/79-1981/82 SCF = 0.75; 1982/83-2001/02 = 0.83.

3/ July 1983.

- 23 -

NPW Annual:'.zed NPWERR (US$ M) (US~ M)

Base Case 46.1 66.9 8.6Current Estimates _ 46.7 65.2 8.4Current W, Future W 45.8 57.6 7.4

Should the current cropping pattern remain into the future, returns oninvestments would remain highly attractive, even allowing for increased paddycultivation without the Project. Substitution of wheat for Boro paddy,however, would lead to a slightly increased return of US$1.7 M (NPW), orabout 3%, reflecting an expansion of the total command area from 118,000 to140,000 as a result of lower water requirements for wheat.

VIII. BORROWER AND IDA PERFORMANCE

8.01 Given the relatively complex organization of the Project, involving anumber of different loosely coordinated agencies (BADC, IRDP, CBs), theBorrower's performance in carrying out its obligations under the Project wasnot unsatisfactory. While a STW-specific, inter-agency executive committeewas in fact formed at the Project-level, no such specific committees wereformed at thana and district levels. Project officials maintain that forma-tion of these originally proposed new committees would have been duplicationsof other, more general agricultural and rural development committees alreadyin existence at thana and district levels. STW Project matters were handledby these, and Project-related agency representatives were called upon toattend as required. Therefore, the fact that once procurement difficultieswere overcome, progress with STW distributions was satisfactory indicatesreasonable success with working within the existing system. Should theProject be replicated in future, the option to use such existing institutionsshould be explored. Lack of coordination among the various BADC divisions,however, was seen as problematical since each tended to operate independ-ently. This was exemplified by the failure to comply with the Creditcovenant requiring merger of BADC's LLP, DTW, and STW Divisions in the NW.BADC subsequently agreed to such a merger on a nationwide basis in the con-text of the joint GOB/IDA minor irrigation sector review. By end-1979, theSTW hire-purchase system had been discontinued. IRDP had fair to excellentsuccess in completing debt inventories in the five Project districts, but washampered in this activity by Cooperative Department issuance of new loans tofarmer groups without notification to IRDP. Lastly, GOB regrettably hasfailed to regulate exploitation of groundwater resources and to draft legis-lation toward this end. As a result, exploitation continues in a rathernon-rationalized manner. Relatedly, it has neglected the updating of thanairrigation maps, a necessary input into the MacDonald groundwater model thatpotentially forms a sound technical basis for regulated development of NWaquifers.

8.02 Progress reporting was regular and timely, although report qualitywas sometimes less than satisfactory. BADC maintained Project accounts of

- 24 -

receipts and expenditures but in a manner criticized by IDA. To improveaccounting procedures, BADC engaged an accounting consultant to prepare anaccounting manual. Two drafts were submitted to IDA for comment, and IDAfound both unacceptable. Despite indications from BADC that account auditingwas in fact done in a timely manner, such audit reports were not sent to IDAfor review. Evaluation studies to assess (a) the direct and indirecteconomic and financial benefi s and the socio-economic characteristics ofbenieficiaries, and (b) effect veness of the improved repair and maintenancefa ilities nave been prepared The former included a satisfactory analysisof the agri ultiral impact of the Project, but contained insufficient quan-titative anElys.is of financia and e,:onomic impacts.

8.03 IDA project supervision was regular and carried out with staffingcontinuity (one person was on five of seven missions between October 1977 andApril 1982). In addition, RMB was in continuous touch with Project-levelstaff and made regular field visits. HQ mission data are recorded in theBasic Data Sheet. Summary Project evaluations from HQ supervision reportsare in Annex 12.

PIANGLADENSI

SHALLOW TUBEWELI.S PROJECT

Cr. 724-BD

ImplementacioR Schedule

1977-78 1978-79 1979-80 1980-81 1981-82 1982-83

ST'Js Procurement

Apptalsal (10,500) . *..................... ... e.........**........

Actual (11,050)

Sni Sale

Appraisal (10,000) ....... ....... ....................

Actual (11,000) ... . ................................... _ _

Ci.vil. Works - Workshops

Apprais:al ...............................

A(-Lua'l

Procurement of Machinery

rquipmentt and Tools

Appraisal ..........................

Actual

Technical t.ssistance

a) Evaluation Study

AppraLsal ...................Act ual

b) Workshonp 1anagementconsultant

Appraisal x

- 26 - ANNEX 2

BANGLADESH

SHALLOW TUBEWELLS PROJECT

Credit 724-BD

Actual Schedule Of Expenditures Reported By BADC 1/

1982-83up to

1977-78 1978-79 1979-80 1980-81 1981-82 June 83 Total

…Taka Millon -------- -- ---------PROJECT COSTS

1. Transport, Vehicles and - 0.417 2.874 1.162 1.078 - 5.531Equipment

2. Pump Engines and Workshop - - 28.565 150.113 21.296 12.067 212.041Equipment

3. Construction - - 0.261 2.704 4.64 6.523 14.228

4. Taxes and Duties - - - 75.800 12.444 5.810 94.054

5. STW Sinking - - 0.211 1.536 3.172 - 4.919

6. Training and Consultants 0.729 1.242 1.425 1.918 1.27 0.674 7.258

Service

Subtotal 0.729 1.659 33.336 233.233 43.90 25.174 338.031

ADMINISTRATION AND SUPERVISIONCOSTS

7. Pay and Allowances - 0.175 0.275 0.523 0.888 1.622 3.483

8. Other Expenditures - 0.36 1.065 8.836 14.368 1.399 26.028

9. Administrative Overhead 1.103 0.407 2.134 6.050 1.200 0.564 11.458

Subtotal 1.103 0.942 3.474 15.409 16.456 3.585 40.969

Total 1.832 2.601 36.810 248.642 60.356 28.759 379.000

Average Exchange Rate US$l - Taka 15.196 15.223 15.477 16.344 20.04 23.745 17.145 3/

US$ Million Equivalent -- -

Total 0.121 0.171 2.378 15.213 3.012 1.211 22.106

1/ Source: BADC2/ Source: Monthly IMF Financial Statements -y Weighted Average

BAIRGLADESH

Shallov Tubewells Pro-lect

Credit 724-BD

Distribution oE Sn4s and Irrigated Area

APPRAISAL ESTIMATES Actual PCR ESTIMATeS OF IRRIGATED AREASTW Irrigated Araa Distribu- 1982-83 Ar Full DevelopmentNumber Ac/STW Total tion STWa Ac/STW Total Ac/STW Total

(1000 Ad) (1000 Ac) (1000 Ac)ZONE I-IPUP Cruups 2100 14.0 29.5 1326 13.01 17.2 13.01 17.2Individuals 1400 11.0 15.5 2084 12.95 27.0 12.95 27.0Sub-total 3500 12.9 45.0 3410 12.96 44.2 12.96 44.2

ZO:E 11L/IRDP Groups 1500 10.6 16.0 513 14.75 7.6 14.75 7.6Individuals 1000 9.0 9.0 807 8.05 6.5 12.00 9.7Sub-total 2500 10.0 25.0 1320 10.68 14.1 13.11 17.3

Z0'.E 1T-I/LiDP Groups 2400 20.8 50.0 2437 10.34 25.2 13.75 33.5Individuals 1600 18.7 30.0 3832 9.00 34.5 11.75 45.0Sub-total 4000 20.0 80.0 6270 9.52 59.7 12.52 78.5

WHOLE PnOJECTIRLP GroLps 6000 15.9 95.5 4276 11.69 50.0 13.63 58.3Indivlduals 4000 13.6 54.5 6724 10.11 68.0 12.15 81.7Tctal 10000 15.0 150.0 11000 10.73 118.0 12.73 140.0

/ Ecological zones(called cropping patterns at appraisal)

Zone I - Deep flooded area suitable for Broadcast AmanZona II - Shallowly flooded area well-auited for T. Amsn but poorly &uited for Jute and AusZone III -Nedeium shallowly flooded area well-suited for T. Aman a& well as for Jute and Aus

BANGLADESH

SHALLOW TUBEWELLS PROJECT

Credit 724-BD

4/Appraisal Estimates of Cropping Patterns by Ecological Zone,-

Zne I gone II Zono III TotaleArea ('OOOac) Area ('OOOae) Area ('OOOac) Area ('OO0ac)

BYI g / W / Bo'_ W U B _W B' U W

PADDY

Aus (local) 11.25 11.25 - - - - 16.0 8.0 27.0 19.0 -

Aus (HYV) - - - - - - - 8.0 - - 8.0

B. Actn 40.5 40.5 9.0 - - - - - - 40.5 40.5 9.0

T. Aman (local - - - 21.25 18.75 17.5 68.0 60.0 56.0 89.0 79.0 73.5

T. Anan (IWV) - - - 3.75 6.25 7.5 12.0 20.0 24.0 16.0 26.0 31.5

Boro (HYV) - - 22.5 - - 17.5 - - 16.0 - - 56.0

Subtotal Paddy 51.75 51.75 31.5 25.0 25.0 42.5 96.0 96.0 96.0 172.5 172.5 170.0

OTHER CROPS I

Jute - - - - - - 16.0 16.0 16.0 16.0 16.0 16.0

WheaL - - 9.0 - - 5.0 8.0 8.0 40.0 8.0 8.0 54.0

Pulses and Oilseeds 9.0 9.0 9.0 2.5 2.5 - 8.0 8.0 - 19.5 19.5 9.0Vegetables - - 4.5 - - 2.5 - - 8.0 - - 15.0

Subtotai Other Crops 9.0 9.0 22.5 2.5 2.5 7.5 32.0 32.0 64.0 43.5 43.5 94.0

lotal Cropped Area 60.75 60.75 54.0 27.5 27.5 50.0 128.0 128.0 160.0 216.0 216.0 264.0

Net Area 45 45 45.0 25 25 25 80.0 80.0 80.0 150.0 150.0 150.0

Cropping Intensity Z 135% 1352 120% 1102 110Z 200X 160% 160% 200X 144X 144Z 176%

1/ 11 - Base Year (1976)2/ U - Future Without Project3/ w - Future Witih Project4/ Ecological Zunat:

Zor,e T Deep flooded area presently dominated by Broadcast Amau paddy during the rainy season

Zone 11 - Shallow flooded area well suited for T. Amoan, but poorly suited for Jute and Aus

Zone III- MeJium Shallowly flooded area wall suited for T. Aman as well as for Jute and Aus

/usr I 2/asnad/frenem/BANC/ahal . tube/7-6-R3Wyoon/rec

BANCLADESH

S8ALLOW TUMMLLS PROJECT (CR. 724-ED2

Actual Cropping Patterns by Ecological Zones In 1982-83 4/

ZONFP - I ZONF - Il ZONE - III TOTALCROPS AREA U0'3 aC) ARFA nnoT de) AREA ('0O0 ac) AREA ('ioo SC)

Bi1 P21 W3/ Hi/ 12/ 1U3/ A1/ 10/ W3/ B1/ W2 W U3/

A ?AT1DY1 AU-S(local) 14.1 14.1 1.8 4.8 444 6.5 32.2 32.2 23.9 51.1 5o.7 32.22 AUs (HYV) - - - - n.4 - - - - - n.4 -3 B. Anan 23.9 23.9 7.5 - - - - - - 23.9 23.9 7.54 T. Aran (local) - - - 13.0 12.7 7.1 16.5 16.1 24.5 2*.5 28.- 31.65 T. Anan (1YV) - - - 1.0 1.3 1.4 2.0 2.4 4.R 3.0 3.7 4.26 Aoro (IUYV) - - 44.2 - - 13.8 - - 57.3 - - 115.3

7 S 1b-total Paddy 38.0 38.0 53.5 18.8 18.8 M2A. 50.7 50.7 110.4 107.5 107.5 192.8 NJ

B orilFR rRIPS8 Jute 2.6 2.6 - - - - 5.4 5.4 - 8.0 8.0 -0 Wheat 3.5 3.5 - 0.1 0.1 0.3 3.6 3.6 4.2 7.2 7.2 4.510 Pulses and Oilseeds 12.4 12.4 3.5 0.2 0.2 0.4 10.1 10.1 1.2 22.7 22.7 5.111 Vegetables 1.8 1.8 - 0.1 0.1 0.6 8.4 8.4 - 12.1 12.1 0.6

12 Sbih-total Other Crops 22.1 22.1 3.5 0.4 0.4 1.3 27.5 27.5 5.4 50.0 50.0 10.2

Totfl Cropped Area 60.1 60.1 57.0 19.2 19.2 30.1 78.2 781.2 115.8 157.5 157.5 203.0Net Area 44.2 44.2 44.2 14.1 14.1 14.1 59.7 59.7 59.7 118.0 118.0 118.0Cropping Intensity 1362 136Z 1242 1362 136% 213X 1312 131Z 194% 133% 1332 172X

1/ R - %aas Year2/ V - Future Without Project3/ U! - Furure lith Project4/ Ecologfcsl 7ones

ZOne I - Deep flooded area, presently dorminated by Broadcast Man paddy during the rainy season.Znne TT - .itvallowly flooded area. well suited for T. hAn, hut poorly suited for Jure & Aue.Zune III - MieJium shallowly flooded area well eulted for T. Amon an well as for Jute & Aus.

LI'

BANCLADESH

Shallow TubewellS ProieCt

Credit 724-BD

PCR stimates of CropptnR Patterns by Ecological Zone.4/ at Full Dbvelopment

ZONE - I ZONE - I_ ZONE -,IIIICROPS Area -2 Area ( 000 nC) Area ( 000 ac) Area ( 000 ac)

U _ B V U B W W B W VA. PADDY1. Aus(local) 14.1 14.1 1.6 5.3 3.0 2.0 42.4 42.4 31.4 61.8 59.5 35.22. Aun(HYV) - - - 2.3 4.5 - - - - 2.3 4.53. B.Aman 23.9 23.9 7.5 - - - - - - 23.9 23.9 7.54. T.Am3n(10Cal) - - - 15.5 15.5 7.1 2918 23.5 23.6 45.3 39.0 30.75. T.Aman(HYV) - - - 2.0 2.0 1.4 3.1 9.4 18.8 5.1 11.4 20.26. BOre - - 44.2 - - 7.0 - - 39.2 - - .90.47. Sub-total Paddy 38.0 38.0 53.5 22.8 22.8 22.0 75.3 75.3 113.0 136.1 136.1 188.5

B. OTHER CROPS8. Juto 2.7 2.7 - - - - 6.0 6.0 7.0 8.6 8.6 7.09. Wheat 3.5 3.5 - 0,2 0.2 13.9 4.7 4.7 36.0 8.4 8.4 49.9 110. Pulses and 12.4 12.4 3.5 0.3 0.3 0.4 13.3 13.3 1.6 26.0 26.0 5.5

Oilseeds .11. Vegetables 3.5 3.5 - 0.2 0.2 0.6 3.7 3.7 1.4 7.4 7.4 2.012. Sub-total of the 22.1 22.1 3.5 0.7 0.7 14.9 27.7 27.7 46.0 50.4 50.4 64.4

Croaps

Total Cropped 60.1 60.1 57.0 23.5 23.5 36.9 103.0 103.0 159.0 186.5 186.5 252.9AreaNet Area *44.2 44.2 44.2 17.3 17.3 17.3 78.5 78.5 78.5 140.0 140.0 140.0Cropping Intens- 1362 1361 129S 136% 136Z 213Z 131X 131X 203% 133Z 133S 180Zity

1/ B - Base Year2/ U - Future WLthout Project3/ W - Future Wiith Project4/ Ecological Zones

Zone I - DUep flooded area, presently domlnated by Broadcast Aman paddy during che rainy season.Zone rr - ShalloWIly flooded area, well suited for T. Aman, but poorly sUited for Jute & AuS.Zone III - Medium shallowly flooded area well suited for T. Aman as well as for Jute & Aus.

CxY

MBNGLADRSH

SHALLOW TUBEWELLS PROJECT

Credit 724-ED

Appraisal Estimates of CroppIng Patterns, Yields and Production

Cropped Area ('OOOac) Yields (Ton/Ac) &uctrionc Tons) IrmefteaiPrlducwion

CROPS Bi-/ f2/ WY/ B W W B W W U-M

PADDY

Aus (local) 27.0 19.0 _ 0.45 0.45 0.45 - 12.2 8.5 - - 8.5Aus (WYV) - 8.0 - 0.75 0.82 0.82 - 6.7 - - 6.7Lroadcast Aman 40.5 40.5 9.0 0.45 0.45 0.52 18.2 18.2 4.7 -13.9T. A"ran (local 89.0 79.0 73.5 0.60 0.67 0.75 53.4 52.9 55.1 2.2T. Aran (HYV) 16.0 26.0 31.5 0.90 0.97 1.12 14.4 25.2 35.3 10.1Boro (IfYV) - - - 56.0 1.31 1.38 1.38 - - 77.3 77.3

'Subtotal Paddy 172.5 172.5 170.0 98.2 111.5 172.4 60.5

Other Crops

Jute 16.0 16.0 16.0 0.49 0.52 0.60 7.8 8.3 9.6 1.3Ulleat 8.0 8.0 54.0 0.45 0.56 1.04 3.6 4.5 56.2 51.7Pulses & Oilseed 19.5 19.5 9.0 0.22, 0.22 0.22 4.3 4.3 2.0 - 2.3Vegetdbles - - 15.0 2.61 2.61 2.61 - - 39.2 39.2

Subtotal Other Crops 43.5 43.5 94.0

Total Cropped Area 216.0 216.0 264.0Eet area 150.0 150.0 150.0Cropping Intensity % 144% 1441 176%

1I Base Year (1976)2/ Y'C Fruture Witliout Project31 Wh Future with Project

BANGLADIESHt

SIIALTOW TUr.EWEII,S PROJECT

Credit 724-ltD

Actual Cropping Patterns, Yields aid Production (1982-83)

Production IncrementalCropped Area ('000 ac) Yields (Ton/Ac) ('000 Metrie Tons) Production

CDOO0 Metric Tans)PADDY El/ W2/ W3/ B W W B W W -

Aus (local) 50.7 50.7 32.2 0.45 0.45 0.49 22.8 22.8 15.8 -7.0

Aus (IIYV) 0.4 0.4 - 0.75 0.75 - 0.3 0.3 - -3.0

Broadcast Aman 23.9 23.9 7.5 0.45 0.45 0.49 10.8 10.8 3.7 -7.1

T. Auan (local) 28.8 28.8 31.6 0.60 0.60 0.67 17.3 17.3 21.2 3.9

T. Aman (HYV) 3.7 3.7 6.2 0.90 0.95 1.10 3.3 3.5 6.8 3.3

Boro (HYV) - 115.3 - - 1.40 - - 161.4 161.4

Sub Total 107.5 107.5 192.8 54.5 54.7 208.9 154.2

OTHER CROPS

Jute 8.1 8.1 5.4 0.50 0.52 0.60 4.0 4.2 3.3 -1.0

Wheat 7.2 7.2 4.5 0.60 0.65 0.90 4.3 4.7 4.1 -0.6

Pulses & Ollseeds 22.7 22.7 5.1 0.3 0.3 0.3 6.8 6.8 !.5 -5.3

Vegetables 12.0 12.0 0.6 2.6 2.6 3.0 31.2 31.2 1.8 -29.4

Sub :ota1 50.0 50.1 15.6

Tota1 Cropped Area 157.5 157.5 2n8.14

Net Area 118.0 118.0 118.0

Cropping lntcnsity 1332 133X 176Z

I/ B - Bjse year (before project)21 W1 - Future without project3/ W - Future with proJect (full development) X

BANCLADESH

SHALLOW TUREWFELLS PROJECT

Credit 724-BD

PCR Estimates of Cropping Pattern, Yeilds and Production at Full Development (1988-89)

CROPPED AREA (1000 ac) YIELDS (TON/AC) PRODUCTION ('000 TONS ) INCREMFNTALPRODUCT T ON

Bi/ W2/ W3| B W W B W W W -1W

PADDY

Aus (local) 61.8 59.5 35.2 0.45 0.45 0.49 27.8 26.8 17.2 -9.6Aus (HYV) - 2.3 4.5 0.75 0.75 0.80 - 1.7 3.6 1.9B. Aman 23.9 23.9 7.5 0.45 0.45 0.49 10.7 10.7 3.7 -7.0T. Aman (local) 45.3 39.0 30.7 0.60 0.60 0.67 27.2 23.4 20.6 -2.RT. Anan (HYV) 5.1 11.4 20.2 0.90 0.95 1.10 4.6 10.8 22.2 11.4Boro (HYV) - - 90.4 - - 1.40 - - 126.6 126.6

Sub total Paddy 136.1 136.1 188.5 70.3 73.4 193.9 120.5

OTiIER CROPS

Jute 8.6 8.6 7.0 0.50 0.52 0.50 4.3 4.5 4.2 -0.3Wheat 8.4 8.4 49.9 0.60 0.65 0.90 5.0 5.5 44.9 39.4Pulses & Oilseeds 26.0 26.0 5.5 0.30 0.30 0.3 7.8 7.8 1.7 -6.1Vegetables 7.4 7.4 2.0 2.60 2.60 3.0 19.2 19.2 6.0 -13.2

Sub total Other Crops 50.4 50.4 64.4

Total Cropped Area 186.5 186.5 252.9

Net Area 140.0 140.0 140.0

Cropping Intensity X 133Z 133% 180%

1/ B - Base Year2/ W Future without project_/ W = Future with project

BAK:I ADFESH

Shallow ?u wel?s Prolect

Credit 724-BO

Crop Input Requ 1ire nt&

T.Aman T.Aaan Boro Pulses 2/Aua(local) Aua(HYV) B.Aman (local) (WVV) (h2YV) Juta Vheat Oilse.d Vegetables 2/

w i w O w y Q w u w Q w w u wFERTIltIZERS

tres (Mds/.c) - - 0.5 1.0 - - 0.3 0.4 1.2 1.5 1.6 I.8 0.8 0.8 0.8 1.4 - - ?.0 2.0

.sP (HJeIac) - - 0.3 0.5 - - 0.2 0.2 0.6 0.8 0.8 1.0 0.5 0.5 0.3 0.7 - - 1.0 l.0

(M:J:/ac) - - 0.1 0.1 - - - 0.1 0.1 Q.3 0.4 0.5 0.1 0.1 - 0.3 - 1 I.0 1.0

Pr,paratlon (Manddy/ac) 17 17 18 19 15 IS 21 22 22 22 22 22 16 16 20 21 1S IS 30 '0

°l1,nning and Nursing (M.nd.y/Ic) 2 2 2 2 2 2 18 18 18 18 18 18 1 1 2 2 I 1 20 20

Crop 4anaFement (U-d/aL) 6 6 10 11 3 3 11 12 12 13 12 IS 20 20 14 16 2 2 2) 25

Harvesting and Tra.hing (m-I/.ic) 20 20 22 23 20 20 23 24 27 28 30 31 S0 50 26 31 17 17 17 0 L O

Sub-tatal (-dJ/..:) 45 45 52 55 40 40 73 76 79 81 82 8n M7 87 62 70 35 35 1'0 hIO

orm-ER 1.P-t7rs

Ac..r-l Power (YdIrday/ac) IS 15 17 17 IS 15 17 17 17 17 17 17 16 16 24 16 15 1S iS IS

S.! Ib"j/.l;; 1.0 1.0 1.0 1.0 1.0 1.0 0.4 0.4 0.4 0.4 0.4 0.4 0.! 0.2 1.0 1.0 0.3 CG31 10 1.0

)s.,cilaneous 3/ (Tk/as.) 1S IS 60 80 IS IS 20 25 90 100 90 100 15 Is 6. 75 15 15 70 70

- Q - Future vithout Praject. W - Future witb Project

2/ cor?.site Cro.ps. Inp.,t RequireMentE are notional.

31 Ir.clu!as pcstl.ides

-35- ANNFX 1 I-A

BANGLADESH

SHALLOW TUBEWELLS PROJECT

Prices Used in Financial and Economic Analyses(In Constant 1983 Currency Values)

Financial Economic (USS)Unit (TkCT)1/ 1979-80 1984-85 1994-95

Outputs

Paddy TK/ton 3,966 237.0 205.0 263.0Wheat Tk/ton 4,342 231.0 213.0 244.0Jute Tk/ton 4,049 181.0 148.0 156.0Oilseeds Tk/ton 8,040 439.0 419.0 503.0Vegetables 2/ Tk/ton 2,144 116.0 73.0 73.0

Inputs

Paddy 3/ Tk/maund 160 9.4 8.0 10.3Wheat Seed 3/ Tk/maund 170 9.1 8.4 9.6Jute Seed Tk/maund 557 27.0 18.9 18.9Oilseed Seed 3/ Tk/maund 300 17.2 16.4 19.7Vegetable Seed Tk/maund 80 4.3 2.7 2.7

Human Labor Tk/manday 18 0.43 0.52 0.52Bullock Labor 4/ Tk/pairday 25 0.75 0.81 0.81

Diesel Tk/gallon 38 1.2 1.5 2.0Lubricating Oil Tk/gallon 198 6.2 7.7 10.7

Urea Tk/maund 148 11.9 10.5 17.0TSP Tk/maund 140 9.8 9.4 12.1MP Tk/maund 110 6.5 5.9 7.5

1/ 1983 prices.

2/ Potato used as representative vegetable crop.

3/ For economic prices, 5% premium placed on output priceto derive seed prices.

4/ Includes driver.

BATNLAESIH

SItLLOW TbIEYSL6S PR[CT

1Nonam.c R,?gl Flou 1

(in UtS Axiliorn)

TErR 2/ 1979 1980 1981 1982 1903 1984 198M 1986 1987 1988 19 IM 1990 1991 1M 1993 194 1995 1996?7-1799 20eo 2001 2002~~~~~~~~~~~~- -- -- _-- ------ - - -- ----_ -- - -- _ - --- ---_- -_-- -_ --_,____-- _- - -- -_- _-_- -_

BEfNEFITS 3'

Paddi - .29 19.44 28.90 30.23' 30.24 29.58 29.71 J0.21 30.74 31.32 32.14 32.07 31.92 31.05 31.70 31.70 31.70 31.70 29.31 15.45.hty - - 0.02 0.09 -0.02 - 0.06 0.11 0.19 0.45 0.38 0.46 0.4 0.47 0.45 0.43 0.41 0.41 0.41 0.41 0.18 0.20L122 - - - -0.05 -0.,7 -0.23 0.21 0.85 1.86 3.52 6.17 10.38 10.67 10.64 10.5S 10.56 10.50 10.50 10.50 10.50 9.71 5.123.1ieeds _ - -0.19 -1.21 -2.30 -2.39 -2.60 -2.77 -2.?1 -3.08 -3.25 -3.46 -3.52 -3.51 -3.50 -3.49 -3. 0 -3.49 -3.49 -3.49 -3.23 1.70Vaget.bls. - - 0-22 -1.21 -2.03 -1.94 -1.66 -1.39 -1.08 -0.73 -0.32 0.05 0.19 0.19 0.18 0.18 0.17 0.17 0.17 0.17 0.14 0.0o~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~- --_- - -- -- --- - --- _- --- .-- __-__- - - - -_._------.

Total - - 2.S9 17.05 24.29 25.69 26.25 26.38 27.78 30.37 33.60 38.86 39.98 39.86 39.64 39.53 39,20 39.30 39.30 39.30 36-33 19.85

COSTS

C,'IT3! COSTS 41

q.S Imp TufoeOlls - 1.14 6.18 5.B2 - - - - - - - - - - - - - - - -stV Installatior - 0.1O 0.90 0.93 - - - - - - - - - -

Civil Vaiks - 0.02 0.13 0.24 0.44 - - - - - - - -EramI I J.iaitcs 0.18 1.10 0.45 0.44 0.14 -trMining I TA 0.10 0.07 o011 0.11 0.08 - - - - - - - - - - - - - - - * -E£ti.e Pvlac-aents 51 _ - - - - - 0.24 .41 8.5- - - - - 0.24 1.41 1.57T..: 'lz4wts 6 - - - - -- - - - - 0.15 0.88 0.9 - - - - - - -

Subtctal 0.27 2.51 7.86 7.54 0.59 - - - 0.24 1.41 1.57 0.15 0.88 o.se - 0.24 1.41 8.57 - - -

RECUlMEN1 COSTS

AD6lIl Lt0TS

Nic.S 0.05 O.IS 0.72 0.75 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02I .P- - 0.081 0 .0 - - - - - .SGnal 8a.k - - 0.01 0.01 0.0o 0.0! 0.01 0.01 0.01 0.01 0.01 0.01 0.01 8.01 0.01 0.01 0.01 0.01 0.01 0.01 0.01 0.01.Ianta Boan 7/ - - - -- - - - - - - - - - - - - - - - - -

Subtatil 0.05 0.20 0.75 0.79 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04 0.04

DIRECT DIl MI

Cle-Wl - 0.20 1.43 3.04 3.27 3.54 3.29 3.46 3.36 3.67 3.73 3.89 4,03 4.18 4.35 4.52 4.73 4.70 4.70 4.32 2.301.1bricar.ts - 0.03 0.18 0.38 0.41 0.44 0.42 0.43 0.45 0.46 0.47 0.47 0.50 0.52 0.54 0.57 0.59 0.59 0.59 0.54 0.290,erator Salann - 0.05 0.37 0.75 0.04 0.84 0.84 0.84 0.84 0.84 0.84 0.84 0.04 0.84 0.84 0.84 0.84 0.84 0.84 0.78 041 -Sares - 0.06 0.36 0.59 0.50 0.48 0.48 0.48 0.48 0.48 01.48 0.48 0.48 0.48 0.48 0.48 0.48 0.48 0.48 0.44 0.23

SuItu'atl - 0.34 2.34 4.76 5.02 5.31 5.12 5.21 5.33 S.S $.SR 5.70 5.85 6.03 6.42 6.41 6.61 6.61 6.61 6.09 3.23

8ncr Crop Costs 3/ - 0.54 3.93 7.31 7.19 6.92 7.19 7.67 8.23 9.16 10.67 11.01 01.21 11.23 11.27 81.30 l.3l 11.31 11.31 10.46 5.51

Total 0.31 3.5M 14.88 20.40 12.04 12.27 12.35 12.82 11.84 16.06 17.6 86.91 17.98 18.29 17.53 37.99 19.37 19.53 7.6 8d.59 1.79 - .04nl:c.. - - -m-: -- z- - ... r.. nt:t:- , s-- :... -nl,,. -r: ... =.t::t:lI z.t.t . ttgt- - .:.s. .:.=... .es t:-

Mt 1rc, SIfa -0.33 -3.59 -11.99 -3.35 11.45 14.41 ;3.S9 I.44 13J.4 14.31 15-83 21. r 22.00 21.53 22.11 21.54 19.92 19.76 21.33 22.71 27.55 19.11

-37-

ANNEX 11-BPage 2

BANGLADESH

SHALLOW TUBEWELL PROJECT

Economic Real Flow: Footnotes

1/ Expressed in constant 1983 currency values.

2/ Bangladeshi Fiscal Year: 1979 July 1, 1978-June 30, 1979.

3/ Reference ANNEX 11-A for input and output prices. A oneyear lag is assumed between costs and benefits. Benefitsand costs are expressed in incremental terms over Without-Project levels.

4/ Based on actual expenditures during implementation period.

5/ STW engines assumed replaced after seven years.

6/ STW pumps assumed replaced after ten years.

7/ Values less than US$ 0.01 M.

8/ Based on an assumed operation of each STW of 700 hours p.a.Fuel requirements p.a.: 210 gallons of diesel and fivegallons of lubricating oil. Spares cost p.a. equivalent to5% of STW capital cost (engine, pump, accessories). Laborrequirements equivalent to 87.5 mandays.

-38-

ANNEX 12Page 1

BANGLADESH

SHALLOW TUBEW4ELLS PROJECT

Credit 724-BD

SUlMMARY PARAGRAPHS IN SUPERVISION REPORTS

First Supervision Report, October 1977

Due to delays in approval of the Project Proforma by the Govern-ment, the Credit could not be declared effective by September 30, 1977.At Government's request, a two-month extension has been granted for ful-filling the conditions of effectiveness. After some initial delays,tender documents for procuremient of equipment and materials for thetubewells have now been finalized. Tender doc'nents for procurement ofother equipment and materials are under preparation and are expected to beready by December 1977. Preparation of Thana Irrigation Maps is progress-ing satisfactorily. Delays in locating and hiring a suitable WorkshopM4anagement Consultant may delay implementation of the workshop improvementprogram.

Second Supervision Report, October 1978

After a satisfactory start progress has slowed down. IDA concur-rence has been given to GOB's decision on first 1,500 Shallow Tubewells.Equipment procurement has been initiated but going rather slow. BADC'sengineering consultant is assisting with preparation of BADC's list ofworkshop spares in conjunction with an ILO consultant. Trend is likely toimprove. Regional Workshop at Bogra is not yet released to BADC(MIN/ERD). Construction of LGRD workshops is delayed due to delays inresolving funding process (BADC/LGRD). Purchase of accessories by freshtender cannot be done in time for Boro 1979 installation. Means must befound to salvage old tender. A detailed program has been prepared forconstruction of workshops, procurement and installation of workshop equip-ment for Thana and Zonal workshops.

Third Supervision Report, May 1979

The project had been at a standstill due to management constraintsin procurement, but progress has recently been made as orders tlave nowbeen issued by BADC for engines and pump sets, tools and equipment, office

-39-

ANNEX 12Page 2

equipment and transport. Preparatory steps for implementing the workshopcomponent have also begun.

Trend is likely to improve.

Problems.

(i) Implementation of farmers' choice procedures for the procure-ment of pumpsets (even number and fair exposure of allmakes);

(ii) Organization of maintenance and repairs;

(iii) Zonal workshops are overcrowded with obsolete equipment whichis taking valuable space in and outside of existing build-ings; and

(iv) IRDP has not completed the 'debt inventory' and 'land inven-tory' for farmers groups in the project area, because theCooperative Department has recently issued fresh loans tofarmers groups without notifying IRDP.

Fourth Supervision Report, November 1979

Status. The recommendations of the last supervision mission onthe procedures to be followed to develop a farmer's choice system of pumpprocurement have been carried out. Phase 1 has been completed and arran-gements are now going ahead for Phase 2. The project's procurement ofshallow tubewell pumpsets, although beh4nd schedule, is proceeding as2,050 pumpsets would be distributed on or about mid January 1980. For thesecond order of 5,000 STWs, BADC has agreed to obtain quotations forAugust 1980 delivery from those manufacturers/suppliers who were selectedto supply STW units under the first project procurement and other manufac-turers whose equipment has been satisfactorily tested and shown to besuitable for Bangladesh conditions, and approved by GOB and IDA. Pricequotations will be obtained by the end of February 1980. The constructionof workshops is proceeding with only a few delays (See Annex 7).

Trend is improving. BADC assured the mission that a new Implemen-tation Schedule would be prepared by December 1, 1979 (DCA 4.06 (b)).

Problems

(i) The purchase of accessories required for the pumping unitshas been delayed;

-40-

ANNEX 12Page 3

(ii) Field management responsibility of the STWl program is not yetformalized;

(iii) Vehicle purchase for the field staff has been held up; and

(iv) BID's benchmark study that was to be started in June has notyet started.

Fifth Supervision Report, July 1980

Status. Earlier procurenent problems have been overcome; the

project is now progressing satisfactorily. Phase I of pump set procure-ment has been delivered and most units sold. Farmers' choice sur-vev iscomplete, and orders based on this have been placed.

Progress on workshop construction and renovation is slow. Themechanic training program is yet to start.

Trend. The project shows marked improvement. Procurement will becompleted ahead of schedule.

Problems.

(i) Progress on workshop construction is slow. Regionalworkshops have not been cleared of unserviceable equipment.

(ii) Training of mechanics has been delayed by BADC's lack ofresponse to consultants' proposals and delays in procurementof training tools.

(iii) Thana irrigation maps have been completed but are not beingkept up-to-date.

(iv) An unsatisfactory accounting manual has been submitted byconsultants.

(v) No evaluation studies have started.

(vi) There is lack of coordination at field level in the workshopprogram.

Sixth Supervision Report, June 1981

Status. Procurement and delivery of STW have been completed.Sales of STW have been delayed by late arrival of pumpsets from suppliersand early rains which discouraged farmers fron tying up their money. Themechanic training program has begun and will continue through December

-41-

ANNEX 12Page 4

1981. The consultant who will conduct the monitoring and evaluationstudy, and prepare data for the draft completion report, has beenappointed and the studies will begin by July. Progress on workshop civilworks (especiallv zonal workshop) is satisfactory. Equipment for theworkshops will'be ordered before June 1, 1981 but may not be delivereduntil December 1981.

Trend. The project's progress has shown improvement, particularlywith procurement. As most of the public sector (BADC) workshops have nowbeen dropped, total disbursements and estimated cost will be much lowerthan estimated at appraisal.

Problems.

(i) Progress on sales of STW is slow.

(ii) BADC's field staff and credit institutions are not recordingsurface and groundwater pumpsets (except HTW) on the thanairrigation maps.

(iii) The second draft of accounting manual is completed but mustbe approved by BADC and

(iv) BADC is slow to procure workshop equipment and BADC is delay-ing the purchase of inexpensive mechanic's tool boxes.

(v) Delay of the mQnitoring and evaluation study and data gather-ing for the draft completion report.

(vi) Project completion will be delayed due to slow sale of STWand delays in delivery of machine shop equipment. Therefore,it will be necessary to extend closing date to December 31,1982.

Sevevth Supervision Report, June 1982

All STW (including an extra 550 above appraisal estimates) havebeen procured and sold to farmers and farmers groups. The mechanic train-ing program is proceeding and will continue through December 1982. Theconsultant will complete the final monitoring and evaluation report byJuly 1, 1982. Progress on the regional workshop is proceeding and will becompleted by November 1982. All equipment and tools, too, will be orderedby that date.

-42-

ANINEX 12Pago 5

The project's progress has improved, particuiarly sal.es and opera-tions of tubewells. It is ex?ected thac as most of the public sector'sworkshops have been dropped, total disbursements and estinaced cost willbe lower than estimated at appraisal.

(i) Thana Irrigation maps are not being updated with recording ofLLPs, DTWs and STWs;

(ii) IDA/STW office is redundant and upkeep is costing valuablefunds; and the same objective could be achieved by closinigthis office and having the Project Manager in Headquarters -BADC for easy access to resolve remaining problems;

(iii) Consolidation of field activities of LLP, DTIl, and STW hasnot taken place and ib further fragmented by ne! separaL,2warehouses, separate stores and little cooperation betweenDTW, STW and LLP for equipnent znd tools for workshops;

(iv) Defective engines from several manufacturers of the pumpsetshave been reported to BADC; and

(v) Completion Report has not been started.

-43-ANNEX

ANNEX - Borrower's Comments Page 1

The original letter of the Covernment could not be reproduced in fullbecause of copying difficulties of some pages at the Bank's print shop.

Government of the People's Republic of BangladeshPlanning CommissionAgriculture Division(Irrigation Wing)Dhaka, Bangladesh

No. PC/WR-131/76/22 (4) February 8, 1984

Mr. Shiv S. Kapur,Director,Operations Evaluation Department,The World Bank,1818 H Street N.W.Washington, D. C. 20433,U.S.A.

Subject: Project Completion Report on BangladeshShallow Tubewells Project (Credit 724-BD)

Ref.: Your D.O. letter dated November 1, 1983on the above subject.

Irrigation wing of the Planning Commission Government of the

People's Republic of Bangladesh examined the report referred above

and have the following comments to offer:

1. The report shows that the approved targets for procurement

and sale of STWs under the project have been exceeded by 5% and

10% respectively. But the reported STW coverage i.e. 10.73

acres/unit on average is less than the estimate of 15 acres/unit

in the approved PP. The unit coverage could have been much

higher in such a project where concerted efforts were envisaged.

The report did not mention as to the measures taken, at all, for

increasing the command area under the STWs of this project. It

seems that emphasis was mainly on selling STWs rather than on

increasing coverage.

2. Although the overall sale of STWs was satisfactory, STW

sale to irrigation groups fell short of the target. It could be

appreciated if more than target could be sold to the groups than

to individuals.

contd....p/2

-44-ANNEXPage 2

3. Non-availability of water by STWs and sinking of STWs in excess

of feasible numoer were reported from some Thanas in the project area.

This report is silent about that problem. The problem of proper siting

and spacing of STWs should also have been touched in the report.

4. The report shows that 24 vehicles, 80 motor cycles and 500 bicycles

were procured against the appraisal estimate of 74 vehicles, 135 motor

cycles and 800 bicycles respectively. But, as per approved procurement

were 50, 114 and 2040 respectively.

5. It is observed that construction of 20 Thana Workshops out of 100

and 6 fuel storage tanks out of 19 were dropped because of enhanced

cost. Planning Commission has not been reported earlier of such

revision of the target. Reduction of targets of any other item except

that of vehicles is not in the knowledge of Planning Commission. Number

of vehicles was reduced from 50 to 28 in the cost rationalisation

exercise made in the Planning Commission.

It will be highly appreciated if our views are given due consideration

in formulating the final conclusions of the project completion report.

.A h ) ./2./2uJoint ChieX

@0 * 1) r¶tary icultare Por4lat Divisiontt= rO 1i>. 36# , hhnhnrF-49 '3on1ndeeh 3eo'ret arint,

2) Seoretazv , XterAal Goioureaeg DtvLgion, iA±istry ofbsee Plnnn-rl.

hJoht A. fLl1, Actinat Held of Agriculture,World Bauk, G. P.C. 3ow 97, 1hn'aa '%n,;1.ndesh.

-45- AMW

C,nxents *f AitDO on Pro.ject cnmpletion repr 3(IDA Credit No.724 ND. )

I SumM & gLncluseon

Para NO. Paut CoMments of JADC

1.01 1 Ne Cement

1.02 1 The total pro.ect cost upt June'8Jwas Tk.338.03M. which is less than11.27% against the appraisel targetTk. 381 M.

1.03 2 As per *ur record 10826 nos of STVswere operated covering an area 128968acres giving per STV wvoerage at 11,91acrs. As per consultant'a survey itreveals that cropping intensity inc-reased from 135% to 1641 .

1.04 2 No cocmt

1.05 2 No comet

1.06 2 No comment

II Jack zrouai

2.01 5 No comment

2.02 4 No e.msernt

2.03 4 N. comment

2.04 4 No coment

2.05 4 No cement

III X dentiM.cti9n.f peawEtiu -Mrei 4a_

3.01 5 Ng oqm.ut

3.02 5 No coinot

30.3 5 meoNe t

-46- ANNEX

Page 4

IV AwPr1aJe Prt.oect

Ps Ne _h. Ceuta of MDC

4.01 7 N caneut

4.02 7 N14 comment

4.03 8 No cmment

4.04 9 No comment

4.05 9 No comment

406 9 No comment

4.07 9 N. comment

4.08 20 Me, consent

4.09 10 No eosent

4.10 10 lo Coent

V. The ImJlMnted P134eot

5.01 11 so comment

5.02 11 Precurersent of pumping set was delayeddue to change ln the policy of procure-ment. A Interational Tender for proeu-reuent of p ane engine wabs floatedin the month of Plarch 1978 which wasaubsequently rejected by the World lankon the ground that the study of thetemdorers was base& on subjective su*dg

enat which was nOt accPtalle to them(eorld Bank),

5.o4 12 Ve oemSeAt

5.05 12 We mext

5.06 12 No amment-

5.07 12 e comaent

-47-ANNEXPage 5

rag& No Pa,;e Comments o' SADC

13 The con3tructI.n *1 Thaia.Zone& Regional Workshop was delpy*to following rea3nzs sa) NOI availability of current

estimate for repair & renevat.ionof incomplete Wiarkshop frr* LCRDDivision.

b) Druping of programme *f cin_truc-tion of 20 new thana workshop underPublic^ Sector.

c) Delay in selection of si tes i orZonal Workshop at DinaZipur.

A) Delay in vacating the Ra,;ienal Work-sho- Cemplex at boera 'y .:an;,lacdeshArmy which they occ.upied during LiV-oration War.

5.09 No comment

5.10 14 No continent

5.11 14 in total 24 vehicles,80 Motor 'tycjeand 50O Ui-cycles were pr9cured. Outs vlich 2 4e0L eLes, 40 V*to-cycleand 3520 0t-etycle wvere rupplied to IRDPand rertaininr 22 vehicles, 4 0 Motorcyc-le & 18C s.i-cycle retained wy BV-DC.

5.12 14 No conrenrt

5,13 14 N.. conm,em;

5.14 15 The total cest ecr*ased fiom the81praisal estimate of Tk.3814 toTk.338.031 ( excluding staff cost).The detail expenditure in Tak skownin aaaeemwe 2 may be changed as perexpenditure incurred shov in appen.dix - I.

5.15 16 No commet.

-48- AMNEX

Page 6

VI Azricultural Ima3ct

Para No baee Comments of 1MADC

6.01 16 No comment

6.o2 16 No comment

6.03 17 No comnt

6.04 18 No coment

6.05 19 No comment

6.06 19 No comment

6.08 19 No comment

tVII FIancial & ScenomAc Reault

7.01 20 N. c¢wnt

7.02 20 No comment

7.03 21 N. eemnent

7.04 21 No coent

7.05 22 No cement

7.0C6 22 No cement

YIII berrower & IDA Performance

e.01 23 Integration of all the Division underIrrigatieu wing of IADC is unier precess.

8.02 23 No ceOMet

8,03 24 No commJ8t

SHALLOW TUBEWELLS PROJECTCREDIT 724-BD

ACTUAL SCHEDULE OF EXPENDITURES BY BADC (Taka - Million)

1977-78 1978-79 1979-80 1980-81 1981-82 1982-83 Totalup to June '83

PROJECT COSTS

1. Transport vehicles and - 0.417 2.874 1.162 1.078 - 5.531equipment

2. Pump, Engines and Workshop - - 28.565 150.113 21.296 12.067 212.041equipment

3. Construction - - 0.261 2.704 4.64 6.623 14.228

4. Taxes & Duties - - - 75.800 12.444 5.810 94.054

5. STW Sinking - - 0.211 1.536 3.172 - 4.919

6. Training & Consultants 0.729 1.242 1.425 1.918 1.27 0.674 7.258Service

Sub-total 0.729 1.659 33.336 233.233 43.90 25.174 338.031

Administrative & Supervision Costs

7. Pay & allowances - 0.175 0.275 0.523 0.888 1.622 3.483

8. Other expenditures - 0.36 1.065 8.836 14.368 1.399 26.028

9. Administrative overhead 1.103 0.407 2.134 0.050 1.200 0.564 11.458

Sub-total 1.103 0.942 3.474 15.409 16.456 3.585 40.969

Total 1.832 2.601 36.810 248.642 60.356 28.759 379.00 xA

IBRD 12391 PCRSS°0 LOB° Eg° FEBRUARY 19U

BANGLADESH

ttamoh &d" f4tbvfy SHALLOW TUBEWELLS PROJECTtmsld.0at rUh F 'n [jZ2<IjC2L EXISTING IROP THANAS RAILWAYS

C,OTnOrl,00 Tho OOnshOlatUtS '' In \\ \ I PROPOSED IROP THANAI EMBANKMENT

"If t Thd 31dd B40 all0 thEd IDA RD I PROJECT THANAS THANA BOUNDARIES

any tdgo,ttOn 0 WlI' pstaInS I * LEf - I PROPOSED ADS RD PROJECT DISTRICT BOUNDARIES.t -oy tetr -I MAtI THAN ASI 04, _. -Or- 1 OR , PRA IBETERNATIONAL BOUNDARIES

M:,JOR ROADS VNDER PROJECT AREA

280~~~~~~~~~~~~~~

AREA'OP MAP ~~~~~~~~~~~~~~~ KU T I ~ ~ ~ ~ ~ ~ A

INDIA \ )~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~-a

THI MP S ASD N ER 139. OVMBR 97 SMEPOUL

-25- 250-~~~~~~~~~LCNME N DINSRTVEBUDRESHV EE AE

IBRD 12392 PCS8° 9°8ANGLADEH 00 FEBRUARY 1984

BANGLADESH

SHALLOW TUBEWELLS PROJECTThe r thS 08,0onstaff LhCAND USt9 Ense -he rs Tt Ketenpe CROPPING PATTERN I MAJOR ROADS

CotOte,e The denn -teto,tteesIt nbthe o.at,8leo - --- MAJOR ROADS UNDER CONSTRUCTION

pSetSe rb Th. Woddf0 5 the (M.nmly Transplant A..., Fallowl , RAILWAYSStere,nlFS.e, C -teoetn sh utbn en M.- 222 tOO CROlPPING PATTERN,III TH-ANA BOUNDARIES

St -OY f rte , r e o (M-mly Tr-nsplant Amnt

, A IsSd,se,t Do n nept St / q - DISTRICT BOUNDARIES

6. - INTERNATIONAL BOUNDARIES

260 260-

-250 51

INDIA ~ ~ ~~IDI

- ~~~~~ 724- 4

NDIA 1H 0 2 00 40 69 0 an

\g|)Xt 2 9<,,3/oW < KILOMETERS < \ ~~~~LKIOM-ETER_ts_-> O ~ ~~~ ~ ~~~~~ ~ ~~~~ ~~~~~ 10 a 20 3|0 4|0 S,0 >

MILESBAYOF BENGA 1. THIS MAP IS BASED ON IBRD 12392, NOVEMBER 1976 SOME POP

PLACENAMES AND ADMINISTRATIVE BOUNDARIES HAVE BEEN DATED