C&Cs. A S d 5 -t7Document of

The World Bank

FOR OFCAL USE ONLY

MICROFICHE COPY

Report No. P- 5640-PAK Type: (PM)SADDINGTON/ X32262 / H5075/ EMlAG

MEMORANDUM AND RECOMMENDATION

OF THE

PRESIDENT OF THE

INTERNATIONAL DEVELOPMENT ASSOCIATION

TO THE

EXECUTIVE DIRECTORS

ON A

PROPOSED C-REDIT

OF SDR 21.4 MILLION

TO THE

ISLAMIC REPUBLIC OF PAKISTANl

FOR AN

ENVIRONMENTAL PROTECTION AND RESOURCE CONSERVATION PROJECT

MAY 14, 1992

This document bas a restricted distribution and may be used by recipients only in the performance oftheir official duties. Its contents may not otherwise be discosed witbhut World Bank authorizadon.

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CURRENCY EQUIVALENTS(March, 1992)

Pakistan Rupee 1.00 - US$0.04US$1.00 - Rs 24.98

WEIGHTS AND MEASURES(Metric System)

Metric Unit British/US Equivaleat

1 centiveter (cm) - 0.39 inch1 meter (m) 39.37 inches1 kilometer (km) 0.62 miles1 hectare (ha) 2.47 acres1 square kilometer (km2) ° 0.386 square miles1 cubic meter (m3 ) 33.33 cubic feet1 liter (1) - 0.264 US gallons1 kilogram (kg) - 2.205 pounds1 metric ton (ton) - 2,205 pounds

ABBREVIATIONS

CIDA - Canadian International Development AgencyDEPM - Department of Environmental Planning and NanagementEEC - European Economic CommunityElA - Environmental Impact AssessmentEPA - Provincial Environmental Protection AgencyEUAD - Environment and Urban Affairs DivisionGIS - Geographical Information SystemGOAJK - Government of Asad Jammu and KashmirGONWFP - Government of North-Vest Frontier ProvinceGOP - Government of PakistanGOProvinces - Government of the ProvincesGOPunjab - Government of PunjabGOSindh - Government of SindhNCS - National Conservation StrategyNGO - Non-Governmental OrganizationNWFP - North-West Frontler ProvinceP&D - Provincial Planning and Development DepartmentPEPA - PakLstan Environmental Protection AgencyThe Council - Pakistan Environmental Protection CouncilThe Ordinance Pakistan 1983 Environmental Protection Ordinance

FISCAL YEAR

July 1 to June 30

FOR OmFFCIL USE ONLY

PAKISTAN

ENVIRONMENTAL PROTECTION AND RESOURCE CONSERVATION PROJECT

Credit end Project Summery

Bonower Islamic Republic of Pakistan

BenefcIarIe: Environment and Urban Affairs Division of the MinLstry ofHousing and Works, University of Peshawar, and the

* Governments of Punjab, Sindh, North-Vest Frontier Proviucesand Azad Jammu and Kashmir.

Amount Credit: SDR 21.4 million (US$29.2 million equivalent)

Terms: Credit: Standard with 35 years maturity

Onlending Terms: Not applicable

FInancing Plan: Local Forelgn Total(US$ mlion)

GOP 1.9 - 1.9GOPunjab 2.0 - 2.0GOSindh 1.7 - 1.7GOWFP 0.8 - 0.8GOAJK 2.6 - 2.6Community Households 5.5 - 5.5EEC 11.7 1.8 13.5IDA 14.4 14.8 29.2

Total 40.6 16.6 57.2

Econonmi Raft Varies from 12X to 30X for different natural resourceof Return: rehabilitation subprojects

Staff Appraisal Report No. 9946-PAKReport:

Map: IBRD 23161R

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

MEMORANDUM AND RECOMMENDATION OF THE PRESIDENTOF THE INTERNAlIONAL DEVELOPMENT ASSOCIATION

0 THE EXECUTIVE DIRECTORSON A PROPOSED CREDIT

TO THE ISLAMIC REPUBUC OF PAKISTANFOR AN

ENVIRONMENTAL PROTECTION AND RESOURCE CONSERVATION PROJECT

1. I submit for your approval the following report and recommendation ona proposed development credit to the Islamic Republic of Pakistan for SDR 21.4million, the equivalent of US$29.2 million, on standard IDA terms with amaturity of 35 years to help finance a project for Environmental Protectionand Resource Conservation. The European Economic Community (EEC) wouldcofinance the project, and would provide a grant equivalent to US$13.5million. The project focuses on two main areas, the strengthening ofenvironmental protection institutions, and rehabilitation of agro-ecologicalresource degradation.

2. Background. Over the last 40 years Pakistan's environment hasdeteriorated greatly due to rapid population growth, mismanagement of naturalresources, lncreasing urbanization and, more recently, industrialization.

3. In the agricultural sector, there is widespread and continuingdegradation of Pakistan's natural resources from the watershbds and rangelandsof the north to the plains and coastline of the center and south. Excessiveand indiscriminate deforestation and grazing of mountains and hillsides isdenuding them of their protective vegetative cover, increasing the intensityof water ru-off and downstream flooding, accelerating sheet and gullyerosion, and intensifylng the silting-up of reservoirs and damage to humansettlements and agricultural production. On the plains mismanagement ofirrigation and drainage is increasing water logging and salinity. Overgrasingof arid and semi-arid rangelands is damaging fragile plant/soil relationshipsand leading to desertification. Indiscriminate development, natural habitatdestruction and unchecked hunting is endangering large numbers of species ofmammals, birds, reptiles and plants.

4. In the urban and industrial sectors, the rapid growth of Pakistan'scities and industrial areas is poorly planned, and is outstripping localinstitutions' capabilities to supply necessary services, particularly potablewater supplies, and sewerage and other waste disposal services. Raw sewerageand urban solid waste are dumped in drainage channels, local streams andrivers, harbors and beach areas. Inadequate or poorly enforced controls allowmotor vehicle exhausts to excessively pollute the atmosphere, and factories todispose of their emissions and waste products witbout regard to their effecton Pakistan's air, water supplies and soil. Ongoing Bank Group projects areaddressing some of these problems, while the National Conservation Strategy(NCS) and Environmental Action Plan will consider further measures to rectifythem.

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S. Until now policy-makers and farmers have focused almost exclusivelyon questions related to agricultural production, and have given insufficientconsideration to developing sustainable resource use systems. Pakistanu's weakenvironmental protection institutions, inadequate legislation, low level ofpublic awareness, policy distortions and insufficiont short-term incentives toencourage resource poor farmers and livestock owners to adopt activities withlong-term benefits, all contribute to the mismanagement of its naturalresources.

6. PokyDOltorkons Due to the substantial divergence between privateand social costs, traditional land and resource use rights freqtently conflictwith government policies for sound management and preservation of forests andrsngelands. Local ommnunity access rights to protected foreqts for timber,firevood collection and grazing have severely degraded large areas of forest,and, because of Increased populations, in some areas these rights are now non-sustainable. Watershed protection for large dams has often been left to theprovincial authorities where the dam is situated, while the irrigationsupplies have gone to beneficiaries outside this area. Consequ4ntly,watershed protection has been inadequate, and potential dam life is beingreduced through excessive siltation. The beneficiaries of irrigation suppliesLn other provinces sbould pay their share of watershed protection costs.Pakistan does not have effective policies for rangeland development,management and preservation. Most rangeland improvement and managementprojects have ended in virtual failure because development policies do notdeal adequately with socio-economic constraints, particularly as they effectsustainable stockfing rates. Policies for the use of Indus river waterscontribute to the degradation of mangrove forests in the Indus delta, the mainfish and crustacean breeding area along the Pakistan coastline. Afterdiverting irrigation supplies, insufficient sweet freshwater is left in theriver for the survival and natural regeneration of mangroves. Irrigationwater is under-priced which contributes to farmers over-watering crops andthen to rising groundwater levels, soil waterlogging and salinity. Under-pricing of water remains a principal constraint to mobilizing the financialresources to invest in adequate drainage to contain waterlogging and salinity.

7. Legisison. Although in 1983 Pakistan passed major environmentalprotection legislation (the Environmental Protection Ordinance (theOrdinance)) providing for the control of pollution in the air, water and soil,and preservation of the living environment, little bas been done since then torectify eromental problems. This bas bappened because the Government ofPakistan (GOP) has not been committed to enforcing the Ordinance, theenvironmental protection agencies are weak, under-staffed and inadequatelyfunded, policy-makers and the public have little awareness of environmentalproblems, and the necessary trained staff are not available. Additionally,the 1983 Ordinance is incomplete and cannot be enforced until Its definitionsand operating regulations are written and gazetted.

8. nattufiensk The Environment and Urban Affairs Division (IUAD) of theMinistry of Housing and Works is the main federal line and policy makingagency dealing with the environment. The Ordinance established the Pakistan

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Environmental Protection Council (the Council) and the Pakistan EnvironmentalProtectlon Agency (PEPA). ZUAD acts as a secretariat for the Council, whoseresponsibilities include enforcing the Ordinance, establishing nationalenvironmental policy, incorporating environmental considerations into nationaldevelopment plans and policies, enforcing national environmental qualitystandards and promoting environmentally-related research. The Council, whichis chaired by Pakistan's President, has yet to meet, and PEPA has yet to bepermanently staffed. The incompleteness of the 1983 Ordinance, along with thecouncil not meetin8g is delaying the promulgation and enforcement of nationalenvironmental quality standards and other important actions such as theformulating of guidelines for environmental impact assessment (EIA)procedures.

9. At the provincial level, Punjab, 8indh and North-Vest Frontier (NVFP)provinces have established Environmental Protection Agencies (EPAs). Thesereceive their authority to act from the 1983 Ordinance, and theirresponsibilities include monitoring environmental pollution and enforcingenvironmental quality standards and regulations. Since the Council has yet toissue national environmental quality standards, EPAs cainnot yet act in thisarea. Punjab's EPA is the most developed, while Sindh and NWFP's EPAs arestill in the formative stage.

10. Stratgy. To counteract environmental degradation, GOP has recentlyfinalized an NCS. EUAD prepared it, assisted by a non-governmentaLorganization (NGO), the International Union for the Conservation of Nature andNatural Resources, and with financial support from the Canadian InternationalDevelopment Agency (CIDA) and the United Nations Development Program. The NCSwill be GOPs first step in preparing a National Environmental Action Plan.IDA, CIDA, and the Swedish International Development Agency will assist GOP todevelop this plan.

I1. While IDA is currently reviewing NCS, IDA and other donors generallysupport Pakistan's environmental objectlves and strategies as annunciated inNCS. NCS proposes three broad strategies to promote effective naturalresource and environment management, that is, achieving greater publicpartnership hi development and environmental management; merging environmentand economics in decision-making; and focussing on durable improvements in thequality of life. To implement these strategies, however, substantialinstitutional development will be required. This project will initiate thisinstitutional development, and to improve natural resource manaSement, willundertake studies and operations to rehabilitate degraded watersheds,rangelands and natural habitats. The project concentrates on this area ofnatural resource degradation as IDA is already assisting to finance severallarge projects to combat Pakistan's other major agro-ecological problem,waterlogging and soil salinity. IDA is also currently assisting GOP undertakea sectoral environmental assessment of Pakistan's irrigation drainage programs(plus associated studies) to develop a comprehensive, efficient, andecologically sound approach to reducing waterlogging and soil salinity.

12. Lessons fom Pa IDA Involment The proposed project incorporatessuccesusful features, and lessons learned, frcmi earlier natural resourcerehabilitation and development projects in Pakistan and elsewhere in theworld. The main features include: (L) establisning programs to improve thedata base and knowledge concerning environmental pollution and naturalresource degradatiot., including measuring existing pollutlon and naturalresource degradation, and monitoring future changes in them; ('i) developingpolicies and programs to nror.,te the efficient use of resources and ensurethat natural resource prices reflect their true scarcity value iaenvironmental terms. This will require removing subsidles and clarifyingproperty rights; (ilL) using EIA procedures to push government line agenciestowards becoming more r nponsible for effectively managing natural resources;(iv) where uncertalnty exists as to the feasibility of a proposed program,using pilot p-ojects to develop appropriate site specific responses totechnical and socio-et-nomic problems; (v) involving project communities inproject design and Implementation, and obtaining their agreement beforeimplementing an intervention; and (vi) taking a multi-disciplinary approach indesigning project interventions, and in evaluating the possible consequencesof these interventions; (vii) providing for considerable adaptive/on-farmresearch to improve hill and dryland farming practices, and for the means todisseminate this new knowledge and practice to the local community.

13. Rationalef IDA InvovmentL The project forms an integral part of GOP'senvironmental protection and natural resource conservation strategies whichIDA supports. It focuses mainly on initiating the strengthening of federaland provincial environmental protection institutions, developing appropriatelegislation, policies and mass awareness programs and, through pilot and otheroperations, rehabilitating degraded watersheds and rangelands. Through boththe policy dialogue at the central level and the more technically orientedinvestments at the project level, IDA Is well placed to assist GOP tackle therange of policy, institutional and teebnical issues that relate to theonvironment and natural resource management projects. The development of aneffective and coherent national approach, supported by site-specificimplementation capacity, will be a long-term undertaking, which is suitablefor IDA support. Finally, there will be an important role of encouragingcoordination and cooperation between donors, particularly on key policy andinstitutional issues where IDA could make a major contribution.

14. Proec ObjectIvs.L The project's specific objectives are to:(1) Initiate the strengthening of key federal and provincial environmentalprotection institutions to enable them to deal with environmental protectionand resource conservation in a systematic and planned manner, and to Improvecoordination between them; (ii) strengthen environmental legislation, andinitiate environmental policies and programs; (iii) disseminate Informationconcerning damage to the environment and natural resources to policy makers,government officials, and the public; (iv) strengthen professional educationin environmental and natural resource management; (v) implement subprojects torehabilitate, protect, develop and manage agro-ecological resources which havebeen damaged or which are threatened with damage; and (vi) undertake policy

- 5 -

studies on natural resource management and preparation of future environmentalprotection and resource conservation projects/subprojects.

15. Projct Dserpton. The project would consist of two oroad crNiponents; aseries of actions to initiate the strengthening of environmental protectioninstiutions in Pakistan, and a series of operations, studies and pilotactivities to rectify or develop site-specific responses to repairing damagedone to natural resources such as watersh,ds. rangelands and natural habitats.The first component would provid. taff, training, teebnical assistance,vehicles, equipment and incremental operating funds to initiate thestrengthening of EUAD, PEPA, and inadh and NWFPs' EPAs; and establish anenvironmental section in Punjab's Planning and Development Department (P&D).It would assist develop operating regulations for the 1983 Ordinance;establish a geographical information system (GI8) based on remote sensing atthe Department of Environmental Planning and Management, Peshawar University(DEEN), to strengthen professional training and research in natural resourcemanagement; initiate mass awareness programs at the federal level and in Sindhand NMF to educate decision-makers and the public concerning environmentalissues; and undertake policy studies on natural resource management andfeasibility studies for future projects. It would also provide for a mid-termreview of project progress. Additionally, project institutions would developguidelines and introduce ZIA procedures; introduce and enforce environmentalquality standards for the discharge of pollutants into Pakistan's air, vaterand soil; measure and monitor environmental pollution including thedegradation of natural resources; and liaise and coordinate with line agenciesin introducing aconomically viable and ecologically sound natural resourcemanagement practices.

16. The second component would consist of: (i) three watershedrehabilitation and development subprojects; (ii) one rangeland rohabilitationand development subproject; and (iii) three reforestation/wildlife refuge areamaagement submrojects. The subprojects are linked to the institutional

development in that they are designed according to NCS strategies, will allowpolicymakers to monitor the effects of their policies, and will providevaluable site-specific learning exercises in implementing watershed andrangeland rehabilitation. Subproject monitoring and evaluation results willbe regularly sent to the environmental protection institutions, whose staffwill also be involved in the mid-term and final reviews of the subprojects.

17. The project has an estimated total cost of US$57.2 million equivalentwith a foreign exchange component of US$16.6 million (292). IDA's proposedcredit of SDR 21.4 million (US$29.2 million equivalent) would finance 512 ofproject costs. The remaining project costs would be financed by EEC (24X),community farmers and households (102), and GOP, GOProvinces and GOAJK (162).Schedule A shows a breakdown of project costs and the financing plan, whileSchedule B shows amounts and methods of procurement and disbursements, and thedisbursement schedule. Schedules C and D respectively, give a timetable ofkey project processing events, and the status of Bank ¢:.oup operations inPakistan. The attached map shows the location of the natural resource

subprojects which the project vould rehabilitate, while the Staff AppraisalReport, No. 9946-PAR, dated Kay 8, 1992, is being circulated separately.

18. Project Impeen taton. UAD would be the main implementing andcoordinating agency for the first project component, that is, strengthening ofenvironmental protection institutions. The provincial Forestry Departments,with assistance from Provincial Agriculture. Livestock and Communications andWorks Departments whore necessary, would mainly be responsible forimplementing the natural resource rehabilitation subprojects. EUAD wouldmonitor the provinces' imp.ementation of the subprojects, and would reporthalf-yearly on impLementatLon progress to IDA. When introducing ZIAprocedures and regulation of lndustrles emissions, GOP will develop incentivepackages to encourage and assist Lidustry to accept and meet the emissionstandards. GOP will give industry time to fully conform with standards toensure growth and employment do not fall.

19. Proect Sustainabilty. This project is the first in what will need to be along-term program of donor asslstance for developing and strengtheningenvironmental protection institutions, policies, and educational and trainingprograms in Pakistan. Recent GOP action to finalize and projectize NCSindicates a desire to go forward and adequately support such a program.Project staff have adopted a multL-disciplinary approach to the designing ofthe natural resource rehabilitation subprojects. This, and including thelocal commnities in subproject design and implementation, plus obtainingtheir agreement to proposed subproject interventions, will help ensuresubproject sustainability.

20. Acons Agreed. At negotiatlons agreement was reached with GOP on thefollowing: (i) EUAD would establlsh and staff three sections by December 31,1992; (ii) PEPA would recruit and place one Director and three DeputyDirectors by December 31, 1992, a second Director and three Deputy Directorsby December 31, 1993 and the third Director by December 31, 1994; (iii) SindhEPA would recruit and fill at least four of its seven sanctioned AssistantDirector positions by December 31, 1992, the remaining three AssistantDirector positions by June 30, 1994, and the four Deputy Director positions,together wlth the necessary support staff positions by June 30, 1995;(iv) NWmP EPA would recruit and fill two Deputy Director, five AssistantDirector and two administrative staff positions, together with the necessarysupport staff positions, by June 30, 1994; (v) Punjab's P&D would establishand staff i.ts environmental section by December 31, 1992; (vi) DEPI would hireat least two additional full-time teachLig staff to work wLth GI8 by December31, 1992; (vii) federal and provlncial agencies would finalize arrangementsgad sign contracts for engaging consultants, with qualifications and underconditions acceptable to IDA by March 31, 1993; (vill) BUAD, Sindh and oPrEPAs, and P&Ds of Punjab, Sindh, NWFr and Azad Jammu Kashmir (AJ1) would:(a) submit proposals for studies to IDA for review and approval beforecommencing the studies, and (b) engage consultan.s with qualifications andunder conditions acceptable to IDA for undertaking the studies; (ix) theCouncil would hold its initial meeting by December 31, 1992, and thereaftermeet regularly at least twice a year; (x) environmental sections in the

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federal Planning Commission and Punjab's P&D, and the provincial ZPAs, by July1, 1993, would: (a) cemmence screening all public development expenditures;and (b) require government agencies to undertake ZIA procedures for all publicinvestments considered likely to ad. ersely affect the ervironment;(xi) government staff would inform t1s AgrLcultural Development Bank ofPakistan (ADBP) and/or the branch of the commercial bank in the area of anyproposed subproject development, and would invite them to join projectimpleventation discussions with local communities when appriopriate; (xiL) in

* accordance witn terms of reference acceptable to IDA, KUAD and P&Ds of Punjab,Sindh, NWFP and AJK, plus appropriate NGOs, jointly with IDA, and withobservers from PEPA and provincial EPAs as appropriate would undertake: (a) amid-term review of the overall project and individual subprojects, by no laterthan September 30, 1995, and would produce a report identifying any reqairedchanges in project implementation with which the project agencies wouldcomply, and (b) a final-year evaluation of the individual subprojects duringthe project's last year of implementation. The IDA credit would not becomeeffective until the Executive Committee of the National Economic Council, orthe Central Development Working Party, or Provincial Development WorkingParty, as the case may be, bas approved the project's Planning CommissionForms No. 1 and sanctioned project expenditures.

21. BenefiL Project benefits are expected to include: (i) improvedcapability of institutions to deal with environmental protection and conserv-ation of natural resources in a systematic and planned manner; (il) increasedshrimp and fish production from rehabilltation of m.igroves along the Sindhcoastline; (iii) stabilization of hillsides and rediction of soil erosion,improved water infiltration of soil, and increased irewood, timber, crop andlivestock production from upland farming and rangeland rehabilitation anddevelopment; and (iv) preservation of wildlife from improved wildlife manage-ment. Subprojects which would rehabilitate natural resources are estimated tohave internal economic rates of return ranging from 12 to 30%.

22. Risks. The main risks to the project include: (i) the possibility ofinsufficient, sustained governmental support, funding and implementatton ofenvironmental institutions and policies; (ii) local communities may rejectgovernment initia..ives to introduce a regulated use of range and forest lands;and (ii) individual farmers may not be able to finance some of the proposedfarm improvements such as orchard production. To ensure adequate governmentsupport for maintaining and implementing environmental institutions andpolicies, the project design adheres closely to proposed NCS strategies;incremental staff recruited under the project would become permanent govern-mental employees at the project's conclusion; and environmental issues wouldbe introduced into GOP's formal economic planning and review process ofinvestment decisions, particularly through the use of ZIA procedures. Theinal design program for the natural resource subprojects should help ia

obtaining local community agreement to regulated land use in watersheds andrangelands. It allovs local communlties and NGOs to be involved in projectdesign through diagnostic studies of farming systems and communLty resourcesto discover and prioritize production constraints and community problems, andthen through roundtable dlscussions between the implementing agencies and

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local communities avd NGOs, to agree on a dselopmert plan. Finally, toensure farmers can obtain sufflelent credlt to undertake farm development,assurances were obtained from the government that the local branches of theAgricultural Development Bank of Pakistan, or the commercial bank in theproject areas, ,wl be lnfozued of any proposed project development and beinvited to join project lmplementation discussions with local communitlea whenappropriate. 1

23. Part of the proposed project (about 20X of the total expenditures)would be carried out ln hJK, an area over which India and Pakistan hbve beenin dispute since 1947. By including ftnance for this component in theproposed Credit, IDA does not intend thereby to prsjudice the determination ofthe claims of the parties.

24. RcoPmmendatIon. I am satisfied that the proposed credit would complywlth the Articles of Agreement of the Association and recommend that theExecutive Directors approve it.

Levis PrestonPresident

AttachmentsWashington, D.C.Nay 14, 1992

-9

PAKISTAN

ENVIRONMENTAL PROTECTION AND RESOURCE CONSERVATION PROJECT

E"_mated Costs and RFnncin Plan

EsUmated Costs:

Local Foreign Total-------- (1(Us$ million)----

Institutional Development 6.9 9.1 16.0Watershed Rhabilitation 21.3 3.0 24.3Rangeland Rehabilitation 0.7 0.4 1.1Forestation/wildlife 5.0 1.4 6.4

Total Baseline Coats 33.9 13.9 47.8

Physical Comtitgencies 2.9 1.4 4.3Price Contingencies 3.8 1.3 5.1

Total Project Costs 40.6 16.6 57.2W

FInanclnt Plan:

local Foreign Total---------(US$ mlllion)-^-____

GOP 1.9 - 1.9GOPunjab 2.0 - 2.0GOSindh 1.7 - 1.7GommP 0.8 - 0.8GoAJI 2.6 - 2.6Housebolds 5.5 - 5.5IEC 11.7 1.8 13.5IDA 14.4 14.8 29.2

Total 40.6 16.6 57.2

Av lucludes US$5.0 million tazes and duties.

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SCHEDULE B

PAKISTAN

ENVIRONMENTAL PROTECTION AND RESOURCE CONSERVATION PROJECT

Procwement Arrangements(US$ million)'1

Procurement MethodProject Element ICB LCB Other NBF/ Total

Civil Works - 2.1 - 0.7 2.8(1.9) (1.9)

Community Develop. - 0.4 - 1.2 1.6(0.2) (0.2)

Reforestation - - 5.7 8.0 13.7(5.1) (5.1)

Fieldwork - - 1.8 4.5 6.3(1.6) (1.6)

Vehicles 1.1 - 0.1 0.4 1.6(0.7) (0.1) (0.8)

Machinery, Equipmentand Xaterials 0.7 - 2.2 0.6 3.5

(0.6) (1.7) (2.3)Technical Assistance - - 4.5 1.2 5.7

(3.6) (3.6)Studies - - 7.6 - 7.6

(6.1) (6.1)Training - - 2.0 0.4 2.4

(2.0) (2.0)Mass Awareness - - 2.0 - 2.0

(2.0) (2.0)Incremental Salaries - - 4.2 1.4 5.6

(2.5) (2.5)Increm. Oper. Costs - - 4.091 0.4 4.4

(1.1) (1.1)

Total 1.8 2.5 34.1 18.8 57.2(1.3) (2.1) (25.8) (29.2)

71 Includes taxes, duties, and contingencies. Figures in parentheses arethe respective amounts financed by the IDA Credit.

/k Not Bank-Group financed./£ Bank financing would be limitee to operation and maintenance expenditures

on vehicles, equipment and civil works.

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SCHEDULE BPage 2

Proposed Disbursements

Category Amount X Disbursed(US$ million)

1. Civil Works, Reforestation 90X of expendituresand Field Works

(i) Punjab 1.4(ii) Sindh 1.5(iii) AJK 4.8

Subtotal 7.7

2. Community Development 60X of expenditures

AJK 0.2

Subtotal 0.2

3. Vehicles, Motorcycles, 1002 for foreign exchangeEquipment expenditures, 1002 of ex-

factory prices of locally(i) GOP 0.5 manufactured items, 702(i) Punjab 0.6 of local costs for(iii) Sindh 0.5 imported items purchased(iv) WFP 0.4 locally(v) AJK 0.8

Subtotal 2.8

4. Technical Assistance 802 of expendituresand Studies

(i) GOP 1.4(ii) Punjab 1.3(iii) Sindh 2.8(iv) NEFP 1.7(v) AJK 1.3

Subtotal 8.5

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WRO BPage 3

Category Amount X Disbursed(US$ ulUon)

5. Training and Nass Awareness 100l of expenditures

(i) GOP 0.9(ii) Punjab 0.2(iii) Sindh 1.2(iv) NMF 1.0(v) AJK 0.4

Subtotal 3.7

6. Incremental Staff Salaries 80X of expenditures untiland Operating Costs US$1.6 million disbursed,

then 60X until US$2.8Mi) OP 0.6 million disbursed, then

(ii) Punjab 0.8 401 thereafter(iii) Sindh 0.5(iv) MW? 0.2(v) AJK 1.1

Subtotal 3.2

7. Unallocated

(i) GOP 0.5(ii) Punjab 0.5(iii) Sindh 0.7

(iv) NWFP 0.4(v) AK 1.0

Subtotal 3.1

Total 29.2

E_d Dh u_d

IDA Fiscal Year93 94 95 96 97 98 99 00

---------------- (US$ million)-----------------

Annual 2.0 1.5 2.0 4.0 6.0 6.0 7.0 0.7Cumulative 2.0 3.5 5.5 9.5 15.5 21.5 28.5 29.2

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SCHEDMLB C

PAKISTAN

ENVIRONMENTAL PROTECIION AND RESOURCE CONSERVATION PROJECT

Tietable for Key Pro oesi Event

(a) Time to Prepare: Two years excluding identificationwork.

(b) Prepared by: GOP, in collaboration with the BankGroup and with financial supportfrom the Royal Norwegian Government.The Bank, while acting as executingagency of a project preparationTrust Fund which the Bank andNorwegian Government established,engaged and managed a consultantteam which assisted GOP prepare theproject.

(c) First IDA Mission: July, 1989

(d) Appraisal Mission Departure: April 16, 1991

(e) Negotiations: April 13-16, 1992

(f) Planned Date of Effectiveness: October 1992

(g) List of Relevant PCRs and PPARs: lasra Forestry Pre-investmentProject, Cr. 755-PAR (PCR No. 6202);Hill Farming Technical DevelopmentProject, Cr. 751-PAK (PPAR No.6577); Kandi watershed and AreaDevelopment Project, India (PCR No.8366); Upper Nagdalena PilotVatershed Nanagement Project,Colombia (PCR No. 8481); and CentralRangelands Development Project,Somalia (PCR No. 7804).

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Page 1

THE STATUS OF BANK GROUP OPERATIONS IN PAKISTANA. STATEMENT OF BANK LOANS AND IDA CREDITS

(As of September30, 1991)

Amount (Smillion)Fiscal t(esa cancellations)

Loan No. Year Borrower Purpose 8ank IDA Undisbursed

Fifty-three loans and eighty-two credits have been fully disbursed. 1730.71 1583.12

of which SECALs. SALs and Program Loans: a/

Ln. 2186-PA 1982 RepublIc of Pakistan Structural Adjustment 60.00Cr. 1286-PA 1982 Republic of Pakistan Structural AdJustment 80.00

Sub-Tota 0.00 80.00

Cr. 0754-PA 1978 Republic of Pakistan Salinity Control and Reolmation 70.00 17.93Cr. 0877-PA 1979 Republic of Paidstan Salinity Control and Recl. (Mardan) 80.00 8.57Ln.2247-PA 1983 Republic of Pakistan Reservoir Maintenance Facilities 10.20 0.34Cr. 1243-PA b/ 1982 Republic of Pakistan 3aluchietan Minorrrig. & Agr. 14.00 5.37Cr. 1348-PA b/ 19a3 Republic of Pakistan Lahore Urban Development 16.00 9.32Cr. 1374-PA bl 1983 Republic of PakIstan Karachi Water Supply 25.00 3.65Cr. 1376-PA bW 1983 Republic of Pakistan Fourth Drainage 66.00 19.52Cr. 1461-FA b/ 1984 Republic of Pakistan Integrated Hill Farming Dev. 21.00 4.76Cr. 1487-PA bl 1984 Republic of Pakistan Command Water Management 46.50 21.33Cr. 1499-PA b/ 1984 Republic of Pakistan Second Small Industries 60.00 4.08Cr. 1832-PAb 1985 Republic of Pakistan Left Bank Outfall Drain -Stage 1 180.00 180.11Cr. 1833-PA bI 1985 Republic of Pakistan Baluchistan Agricultural Extension 8.30 3.21Ln. 2499-PA 1985 Republic of Pakistan Fourth WAPDA Power 100.00 11.03Cr. 1602-PA b/ 1985 Republic of Pakistan Second Primary Education 52.60 42.25in. 258-PA 1985 Republic of Pakisan Fifth WAPDA Power 100.00 14.45Ln. 2648-PA 1986 Repubilc of Paistan Industrial Investment Credit 148.00 0.99Cr. 1648-PAb/ 1986 Republic of Pakdstan industrial Investment Credit 2.00 0.98Cr. 1662-PA 1986 Republic of Pakistan Karachi Special Development 70.00 47.11Cr. 170-PAbl 1986 Republic of Paldstan Second Vocational Training 40.20 28.36Cr. 1693-PA b/ 1986 Republic of Pakistan SCARP Transion Pilot 10.00 6.18Cr. 1699-PA b/ 1986 Republic of Pakdstan Agric. Dev. Bank of Pakistan Vi 86.00 3.22Ln. 2698-PA 1986 WaterlPower Auth. Kot Addu Combined Cycle 90.00 16.78Ln. 2743-PA 1987 Republic of Pakistan Telecommunications V 100.00 12.33Cr. 1756-PA bl 1987 Republic of Pakistan Third Technical Assitance 7.00 5.35Cr. 1i62-PA bl 1987 Republic of Pakistan Ag. Extension IV 42.10- 30.10Cr. 1821-PAbl 1987 Republic of Pakistan Third Primary EducatIon 145.00 124.76Lt.2792-PA 1987 Water/Power Auth. Power Plant Efficiency 70.00 44.34Ln. 2814-PA 1987 Republic of Pakistan Fourth Highways 152.00 9610Lin. 2839-PA 1987 Republic of Pakistan Industries III 54.00 43.96Ln. 2842-PA 1987 State Petr. Petroch. Refinery Energy Coneervation 21.00 17.75Ln. 2884-PA 1988 Republic of Pakistan Cement Industry Modemization 98.00 68.80Ln. 2884-1-PA cl 1991 Republic of Pakistan Cement Suppi. 56.40 56.40Cr. 1888-PA bl 1988 Republic of Pakistan Second Irrigation Systems Rehab. 79.50 66.48Cr. 1895-PA 1988 Republic of PakIstan Punjab Urban Development 90.00 70.46Cr. 1936-PA bl 1988 Republic of Pakistan National Oilseed Development 20.00 16.76Ln. 2973-PA 1988 Republic of Pakistan National Oilseed Development 31.40 31.40Lin. 2982-PA 1988 Republic of Pakistan Private Sector Energy Development 180.00 149.79Cr. 1982-PA bJ 1989 Republic of Pakistan Industrial Investment Credit III 2.00 1.04Ln. 3019-PA 1989 Republic of Pakistan Industrial Investment Credit III 148.00 107.66Cr. 1987-PAb 1989 Republic of Pakistan Karachi Water Supply 125.00 110.74i Ln. 3029-PA 1989 Republic of Pakistan Financial Sector Ln. It 180.00 75.00

* Ln. 3107-PA 1989 Republic of Pakistan Energy Sector Loan II 250.00 118.78* Ln. 3107-1-PA el 1991 Republic of Pakistan Energy Sector Loan II Suppl. 28.00 28.00Cr. 2003-PA b/ 1989 Republic of Pakistan Flood Restoration 40.00 14.41Cr. 2004-PA b/ 1989 Repubic of Pakistan Private Tubewell 34.40 17.18Ln. 3147-PA 1990 Water/Power Auth. Power Transmisson & Extension 162.00 155.3SCr. 2078-PA b/ 1990 Republic of Pakistan Rural Eiectrification 37.00 39.59

- 15 - SCHEDULE DPage 2

THE STATU8 OF BANK GROUP OPERATIONS IN PAICSTANA. STATEMENT OF SANK LOANS AND IDA CREDITS

(Asof September 30, 1001)

DAnount(*1ElonFial logsenohon)

Loan No. Year Bonower Purpose Eank IDA Undbured

Ln. 3148-PA 1090 RepublIc of Paldaan Rural lectrlficalion 12300 1*00Cr. 2102-PA bl 1990 Republic of Paldaan Sindh Primary Education 112.0 10.84Cr.2163-PAbi 1000 Republic of Paiddan Aarloultu Credit 1.0 1*4Cr. 3226-PA 1090 Republic of Paiddean Agrulture Credit 14840 137.08Cr. 215PA bi 190 Repubflo of Paidetan Agricultural Resrch 6730 60.40Ln. 3241-PA 1090 Republic of Paidetan Trauport Sector Invetments 184.00 170.3Ln. 3233-PA 1001 RApublic of Paidetan Corp. Restructuring 130.00 123.14Ln. 3262-1-PA d 1991 Republic of Pakdn Corp. rueturing uppl. e0.00 00.00Cr. 2228-PA bAt 1001 Republic of Paidsan Rural Waler Supply & 8nitation 136.70 131.13Ln. 3318-PAWt 1991 Republic of aistan M bsrenterprls 26.00 26.00Cr. 2240-PA blel 1991 Republic of Paldken Famly HeaN h 4&00 43.26Cr. 2246-PA b/c/ 1991 Republic of Pakistan Third On-Fam Management 47.30 4543Ln. 3327-PA d 1001 Republic of Paldstan Third On-Farm Management 36. 3Cr. 2267-PA bc l 1001 Republic of Pakidtan Second SCARP Transon 20.00 20.13Ln. 3335-PAct 1001 Republic of Pakistan Karahl Port Modernization 01.40 01.40

Total 4446.91 30.02 3104.60of which has been repaid 770.93 136.41

Tota now outstandxn1 36.8 3245.51Amounts sold 33.46 12.00of which has been repaid 32.61 12.00

Total now held by the Sank and IDA 8.2 2S351Total undisbureed 3104.00

al Approved during or after FY80.bt IDACredit.beginningwith the6thReplenishmentare denominatedInSDRe,andare hown

In US$ equivalents at the Ume of negotiations. Disbursed mount are computed at teexchange rate applicabe on the date of this stement

d Not effetie at th fme of this statementS SAL. SECALor Program Loan.

FS:M:-EM1CO1OTHER%PAKMSGSO.WK1November 19. 1091

- 16 SCHEDULE DPage 3

^TQ8OF IN^KGR MwT N8 PAtagM3. SIAUMNTOPIP ICNvSMENT

(As of September80. 188)

AmountM (Slons)a cancellattsio)

Daft borrw Purpo . L*4a Equity T0tal

Is" AdenJee Textflts 0.73 0.00 0.751987/89 Anlo-tuie Petrolem & a" 0.00 6.80 6.80195/81 Asbestos Cemnt Cemnt mnufecturing 4.02 0.51 4.531979/82/84 Attock Petroleum & CaS 1S.00 0.86 15.861965 Crescent Jute Ret & twine 1.95 0.11 2.061969/89 Cawood Fertilizer & Pesticide 18.30 2.92 21.221991 Engra CheucaL Fertilizet & Pesticides 41.06 0.00 41.061991 sxxon Chmcal PtlIlP r & Pesticides 0.00 8.50 8.501981 Pauji Plastie Manufaettwurn 1.78 0.00 1.781988 Facto Cmet Cemnt inufetwing 18.58 D.00 18.58190 File NortAge/hou /savings bank 0.00 0.68 0.681962/65 Sheribst Cement tmwfacturtno 5.25 0.42 5.671981 Habib Arkadv Grafn mill pro*Ats 3.15 0.16 3.311989 Kale Tatni Lt 3.26 0.66 3.921986 Mari gas Petrolem & Ga 46.53 0.00 46.531979/87 Nilkpek FoodUrevage/Tebaco 2.40 0.40 2.801988 Miltet Trectors grie. mah. & euipmet 4.90 0.00 4.901985 MDLC Leasing 5.49 0.37 5.861965/81 /827/8 Packge Container menufcturing 26.00 1.24 27.241980 Pak. itlfields Petroleu & Gas 14.00 1.19 15.191967 Pakistan aper Poor nufacturino 5.38 2.02 7.401990 Pak. Suzui motor vehicle meuacrng 1T.71 0.00 17.711963/5/89 PICIC DFC 0.00 0.63 0.631987 PICIC-AL Smll &medium enterprise 0.00 3.00 3.001991 PILCO Leaing 5.00 0.00 5.001983/IS PPL Petroleum prouct 104.50 .56 106.061980 Pruuium boar SaiLls qLannuin 2.70 0.00 2.701991 Prudential Scurfties Nkt. Finencing 0.00 0.41 0.411990 Rup li Resins & Plastfcs Wf. 22.38 2.00 24.381960 SCP alsc Metals 0.63 0.00 0.631989 Sham Textiles Textiles 2.76 0.00 2.761989 SurSJ Cotton Textiles 2.76 0.00 2.76

Totsl Gros Cid tmmnt 376.24 34.44 410.68

Las Cencallatiems, TenrInation EaneAdjustments. Praepsawet. n aeVritaofts a' sates 280.47 16.07 296.54

Total Ccmeitments now held by IFC 95.77 18.37 114.14

Total UNdisbiread IFC 47.54 5.79 53.33

FS,N:Eg1N0WOTNBlVPWMSIFC.WK1Moveebar 19 1991

MAP SECTION

.

T A J I K I S T A N ~, ECHINA

PAKISTANENVIRONMENTAL PROTECTION AND < (\ L S RESOURCE CONSERVATION PROJECT .2 .

2- ,ONI X

SUR rO JECTS. .

1. Murme Kohuta and KAi- S3Min UplandRehabiItation and Development

2. Dir Kohistan Upland Rehabilitotion and Development ,03. Shimber Upland Rehalbliation anJ Deveomen JAfAIUVA. Kohat Karak RarWndeac Rehabdiltafforn and Development5. AlpinelSub-Alpine Pate Study in Upper Neelum Valley AM06. WWtOife Surove and Managaemer*Plannmog o ~ K SHMI!7. Riveine Reffrton aloCg chenob and Rav48. Rehabaikon and Replnimg of Indus Delta Mangrove -mo '

~- ISOHYETS IN MM.* NATIONAL CAPrIAL

-32 < 0 POVNa CAMALS W 0 OTHER CMTESAND TOWNS.0

l.. ° RIVERSmEs s - ) Ke ,7RIVER\._ ~~PROVINCE BOUNDRIS c hl >),lxb.o5

INTERNATIONAL BOUhMES -' \ '. 50

4-'

A P N I N D I A 'BA A' H INDI

ISLA~k\ Cf . /RaP. OF IRA . U / //

r /('tA #{ k1_ 20°0rS i ) J ,, t% KILOMtETERS

( -> tb \i,Ahl,?SIN S H ' n ~ °S IS O o 200 250 N0 t035040I I o| 50 100 150 200 250

I 1 o0 htLES ''"

A R A B I A N 5 g A e I r;e _-s 24 j

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-1 K e { I . 11 ?|