Document of The World Bank FLE COPY

FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No. 1905b-IND

INDONESIA

IRRIGATION XI Public Disclosure Authorized

STAFF APPRAISAL REPORT Public Disclosure Authorized Public Disclosure Authorized Projects Department East Asia and Pacific Regional Office

This doeuennt has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENT

US$1.00 = Rupiahs (Rp) 415 Rp 100 = US$0.241 Rp 1 million = US$2,409.64

WEIGHTS AND MEASURES - METRIC SYSTEM

1 millimeter (mm) = 0.039 inches 1 meter (m) = 39.37 inches 1 kilometer (km) = 0.62 miles 1 square kilometer (sq m) = 0.386 square miles 1 hectare (ha) = 2.47 acres 1 cubic meter (cu m) = 35.31 cubic feet 1 million cubic meters (MCM) = 811 acre feet 1 liter (1) = 0.264 gallons (USA) 1 liter/second (1/sec) = 0.035 cubic feet per second 1 kilogram (kg) = 2.2 pounds 1 metric ton (ton) = 2,205 pounds

gO'NVERSION FACTORS FOR RICE

1 ton "dry srtalkpaddy" = 800 kg paddy ("paddy gabah") = 500 kg milled rice 1 ton paddy (gabah) = 630 kg milled rice

INDONESIA FISCAL YEAR

April 1-March 31 FOR OFFICIALUSE ONLY

ABBREVIATIONS

BIMAS - Bimbingan Massal Swa Sembada Bahan Makanan "Mass Guidance for Self-Sufficiency in Foodstuffs" a farm input-credit package program BRI - Bank Rakyat Indonesia - People's Bank of Indonesia BULOG/DOLOG - Badan Urusan Logistik - "National Logistics Body" - rice procurement agency/Depo Logistik - provincial branch of BULOG BUUD - Bahan Usaha Unit Desa - Forerunner of KUD as Village Unit Cooperative DGWRD - Director(ate)-General of Water Resources Development DGC - Directorate-General of Cooperatives DIP - Project Implementation Budget DOR - Directorate of Rivers DPMA - Directorate of Hydraulic Engineering GWh - Gigawatt hour (1 million kilowatt hours) GOI - Government of Indonesia HYV - High-Yielding Variety INMAS - Intensifikasi Massal - "Massive Intensification" - a farm input program INPRES - Instruksi Presiden - "Presidential Instruction" - a rural public works program IPEDA - Iuran Pembangunan Daerah - Land Tax KUD - Koperasi Unit Desa - Village Unit Cooperative MOA - Ministry of Agriculture MW - Megawatt (1,000 kilowatts) NFCE - National Food Crops Extension Project O&M - Operation and maintenance PLN - Perusahaan Umum Listrik Negara - National Power Company of Indonesia PROSIDA - Proyek Irigasi IDA - Agency of DGWRD created to execute IDA-assisted projects Proyek Cimanuk - Badan Pelaksana Proyek Pengembangan Wilayah Sungai Cimanuk, "Project Executive Body for Cimanuk River Basin Development" Proyek Hidrologi - Badan Pelaksana Proyek Hidrologi dengan bantuan Bank Dunia, "Project Executive Body for Hydrological Study with World Bank Assistance" REC - Rural Extension Center SEDEKU - Semarang-Demak-Kudus Irrigation System

This document hasa restricteddistribution and may be used by recipients only in the performance of their omcialduties. Its contents may not otherwisebe disclosedwithout World Bank authorization. I INDONESIA: APPRAISAL OF IRRIGATION XI

TABLE OF CONTENTS

Page No.

1. BACKGROUND ...... 1

General .1...... The Agricultural and Rural Sector...... 1 Development Strategies ...... 2 The Irrigation Subsector ...... 4 Project Formulation. 5

2. THE PROJECT AREAS. 7

Location ...... 7 Climate 7 soils. 8 Population, Farm Size and Land Tenure ...... 8 Agricultural Support Program ...... 9 Existing Works and Infrastructure ...... 10

3. THE PROJECT ...... 11

The Project Works .12 Water Supply, Demand and Quality ...... 14 Status of Engineering .15 Implementation Schedules ...... 15 Cost Estimates .16 Financing ...... 16 Procurement .17 Disbursements .18 Accounts and Audits ...... 18 Environmental Effects .18

4. ORGANIZATION AND MANAGEMENT ...... 21

Project Management .21 Consultants, Advisors and Training ...... 22 Agricultural Support Services ...... 24 Operation and Maintenance ...... 25 Monitoring ...... 26

5. AGRICULTURAL PRODUCTION .27

Present Cropping Patterns .27 Future Cropping Patterns .28 Future Yields with Project .29 Cropping Calendars .29 Drying, Storage and Processing ...... 30

This Report is based upon findings of an appraisal mission composed of Messrs. J.J. O'Brien, M. Saddington, W.P. Ting, N.D. Owens (Bank), L. Bartsch, M. Fireman, and E.B. Lipcomb (Consultants), which visited Indonesia in October 1977. - ii -

Page No.

6. MARKET PROSPECTS, PRICES, FARM INCOMES AND PROJECT CHARGES. . 32

Market Prospects ...... 32 Prices ...... 33 Farm Incomes ...... 33 Project Charges ...... 35

7. BENEFITS, JUSTIFICATION AND RISKS ...... 42

8. AGREEMENTS REACHED AND RECOMMENDATION ...... 50

List of Tables in Main Report

3.1 Cipamingkis Subproject Water Balance ...... 19 3.2 Summary Cost Estimate ...... o...... 20 4.1 Consulting Services and Training ...... 23 5.1 Cropping Patterns and Production ...... 31 6.1 Price Structure for Food Crops and Fertilizers ...... 38 6.2 Input and Output Price Summary ...... 39 6.3 Summary of Farm Budgets ...... 40 6.4 Rent Recovery ...... 41 7.1 Economic Analysis - Net Value of Production at Full Project Development ...... 47 7.2 Total Monthly Crop Labor Requirements ...... 48 7.3 Economic Costs and Benefits ...... 49

ANNEXES

1. Cost Estimates, Expenditures, Disbursements and Allocation of Loan Proceeds 2. Crop and Farm Budgets 3. Schedule of Early Events 4. Related Documents and Data Available in Project Files

List of Figures

3.1 Implementation Schedule 4.1 Organization Chart - Director General Water Resources Development 4.2 Organization Chart - PROSIDA 4.3 Organization Chart - DPMA 4.4 Organization Chart - DOR 4.5 Organization Chart - Jatiluhur Authority 5.1 Cipamingkis Subproject - Proposed Cropping Calendar 5.2 Jragung Subproject - Proposed Cropping Calendar

List of Maps

IBRD 13142 Irrigation Project XI IBRD 13144 Cipamingkis Subproject IBRD 13531 Jragung Dam Subproject INDONESIA

IRRIGATION XI

1. BACKGROUND

General

1.01 The Government of Indonesia (GOI) has requested Bank assistance for the construction of a weir and irrigation system for the 7,600 ha Cipamingkis area of West Java; the construction of the access road, diversion tunnel and base camp as the first stage of the Jragung Dam project in Central Java; the initiation of a water resource development oriented hydrologic measurement program throughout Indonesia; preparation of a master plan for the conserva- tion and development of the water and land resources of the Cimanuk River Basin in West Java; and the review and conduct of studies for irrigation development and review and completion of designs for flood control in the lower Cimanuk, Cipanas and Ciwaringin rivers.

1.02 The feasibiity studies for the Cipamingkis subproject was initially prepared with local consultant assistance (P.T. Indah Karya) and updated by the Jatiluhur Authority; for the Jragung Dam subproject, feasibility studies were prepared under PROSIDA with consultant assistance (ECI) from USAID. The Hydrologic Measurement Program was prepared by the Directorate of Hydraulic Engineering (DPMA) and the Cimanuk River Water Management Program by the Directorate of Rivers, with consultant assistance from Gadja Mada University.

The Agricultural and Rural Sector

1.03 Major Issues. The major issues facing the agricultural and rural sector in Indonesia are: the need to create productive employment oppor- tunities to raise the incomes of the rural poor; the need to increase domestic food supply to keep pace with rising demand; the need to expand production of agricultural exports, particularly smallholder tree crops; and the need to ensure productive, sustainable use of Indonesia's varied land, water and other natural resources. These issues are all interrelated. Their solution will necessarily involve complex and sometimes novel technical and organiza- tional approaches, along with attendant risks that must be recognized and accepted if programs are to be developed to deal with Indonesia's problems on the requisite scale. The risks of action must be weighed against the risks of inaction in the face of widespread poverty and underemployment, growing food import requirements, and ecological damage caused by insufficient control of deforestation in the most densely populated areas.

1.04 Role and Performance of the Sector. Although the contribution of agriculture to GDP and exports has declined during the last 15 years, the rural sector continues to be of overwhelming importance to the vast majority of the Indonesian people in terms of employment, incomes and food production. Some 80% of the country's 135.5 million people /1 live in rural areas. With the exception of oil palm and tea, agriculture is dominated by smallholder

/1 Estimate for mid-1978 based on Inter-Censal Population Survey of March 1976. -2-

production; there are some 14.4 million smallholdersproducing subsistence and cash crops on 14.2 million ha and 1,800 large estates occupying 2.2 million ha. Over the five years to 1976, the growth rate of agricultural production has been uneven, averaging 3.8% while total GDP grew at 7.9%. In 1977, agriculturalperformance was disappointing. For the second straight year, rice productionwas plagued by inadequate or untimely rainfall in many parts of Java, and by pest and disease damage to high yielding varieties. In view of the critical role of agricultureas the primary source of house- hold income for over half of all Indonesians,the slowdown in agricultural growth takes on considerablesocial significance.

1.05 Development Problems and Potentials. In Java, the cultivable land is almost fully utilized and in some areas, agriculturalland use already exceeds ecologicallysafe limits. In 1976 about 82 million people lived in Java which has 45% of the cropped area but only 7% of the country's total land area. About one-third of Java's rural population is landless and a large proportion cannot support themselves on incomes from their own farms. Outside Java there are large areas of unused cultivableland, although less fertile than in Java, and other natural resources to be exploited. While the inhabitants of these islands do not have high standards of living, they are generally better off than many in Java.

Development Strategies

1.06 Employment. Perhaps the single most important challenge facing the Indonesian Government is to guide and structure the development process in such a way that the creation of new opportunitiesfor gainful employment does at least keep pace with the growth of the labor force. The changes associated with modernization in rural Java are generally labor-saving,so that farming is increasinglybecoming a part-time activity. Modern manufacturing and services have been unable to absorb the incrementallabor force. Successful locally administeredpublic rural works programs (INPRES),may be difficult to expand due to limited budget and implementationcapacity. Future employ- ment strategy will therefore stress labor-intensiveexport industries and small-scalerural enterprisesproducing for the domestic market. There may also be potential for more productive agriculturalemployment through increased cropping intensity and a shift to higher value crops and livestock, including fruits and vegetables grown on house compounds.

1.07 Food Crops. Despite the heavy emphasis on rice production in the past, recent developmentssuggest a widening gap between domestic production and demand for food. The rate of growth of rice production appears to have declined in recent years and the principal non-rice food crqps have stagnated. There is no room for relaxing the national rice production effort. To keep rice imports below some reasonable fraction of world trade in rice, demand must be shifted to other domestic and imported staples and productionmust grow at around 4% per year. Improved water management and agriculturalsupporting services are essential for increasing rice yields and production. On Java there remains much scope for more efficient water use, through construction of additional tertiary and quater- nary canals. On-the other islands there is potential for new irrigation systems including tidal and swamp land development. Efforts to increase rice production must include an intensified research and extension effort to solve the pest and disease problem. Upland food crops also offer promising develop- ment prospects. There is much room for yield improvement through intensified research and supporting services, and tremendous scope for area expansion in the other islands if stable, long-term cropping systems can be developed. In addition, a food policy which emphasizes upland crop production as well as rice would serve the twin goals of growth and equity better than a policy aimed exclusively at rice, as many of the poorest parts of Java and the other islands are best suited to dry land farming.

1.08 Transmigration. Transmigration offers challenging opportunities for improving social equity and the economic use of Indonesia's two main underemployed resources: Javanese labor and land in the other islands. Transmigration has long been hampered by unrealistic expectations about its potential contribution to regional development and the solution of Java's population problems, overambitious targets and weak, uncoordinated implemen- tation. These problems are now being addressed. The present focus is on the organizational aspects of transmigration and the design of a least cost package of services needed to ensure successful, long-term settlement.

1.09 Tree Crops. The Government has embarked on a major effort to develop smallholder tree crops outside Java as part of its transmigration and national rubber and coconut replanting programs. The objective is to improve production on existing blocks while developing large areas of new land for settlement. One of the Government's main approaches has been to use public estate companies to plant tree crops on land to be settled by local landless families and transmigrants. The estate companies provide a range of services including planting material, land clearing and planting, inputs, processing and marketing facilities for the smallholders. This approach is well taken in view of Indonesia's scarce managerial and technical capabilities.

1.10 The Role of the Government. The capacity of the Indonesian Government to plan and implement agricultural and rural development programs has generally improved over the past decade. However, future programs responsive to the Government's stated objectives will necessarily be more complex than those which the Government has followed up to now. They will require closely coordinated "packages" of research, extension, inputs, credit, land development, transportation and marketing improvements. Multi- agency integrated area development programs in Java and land settlement schemes in the other islands will require stronger field organizations of Government line agencies and local governmental authorities, as well as new administrative arrangements. With the more complex organizational require- ments of future programs, implementation capacity is likely to become the limiting factor in Indonesia's economic and social development. It is therefore of utmost importance that the Government continue its efforts to strengthen the key rural development institutions. - 4-

1.11 Bank Lending Strategy. There is general agreement between the Bank and the Government on the overall objectives and strategies proposed for the rural sector. While views sometimes differ on the relative emphasis to be given to different investments and on the technical design of some projects, such differences are not profound and are likely to be resolved with further analysis and dialogue.

1.12 The Bank has been and should continue to be involved in a broad range of agricultural and rural activities in Indonesia. Since the first irrigation credit in 1968 the Bank has rapidly expanded its agricultural and rural lending to include support for estate and smallholder tree crops, fertilizer production and distribution, sugar estates, support services, transmigration, livestock and fisheries. An integrated rural development project is currently being appraised. Of the three credits closed within the last year (Estates I, Irrigation I and Pusri Fertilizer), all showed excellent rates of return ranging from 25% to 33%. Taking 1974 as base year, Bank financed projects will contribute almost 60% of the increase in palm oil output by 1980, about 16% of incremental sugar production and 6% of incremen- tal rice and rubber. Four continuing trends in Bank agricultural lending to Indonesia are: (a) a shift from rehabilitation to new development activities; (b) a shift from support of state enterprises to direct support of small- holders; (c) an increased emphasis on rainfed systems; and (d) greater emphasis on development of the other islands. All these trends are consis- tent with the Government's changing policies.

The Irrigation Subsector

1.13 Rice is the dominant irrigated crop in Indonesia. Of an estimated 8.4 million ha of rice harvested in 1976, 7.2 million ha were irrigated or grown under wet land conditions. Irrigation systems cover about 5 million ha, of which Java accounts for 60%. Average paddy yields on Java are about 3.3 ton/ha compared with 2.8 ton/ha in the other islands. Although irrigation has long been a major feature of Indonesian agriculture, by the late 1960s, the systems built during the colonial period were in a state of complete disrepair. Irrigation development during the first two develop- ment plan periods concentrated heavily on the rehabilitation of these systems. Construction of new systems, mainly to serve as the basis for transmigration projects outside Java, lagged behind.

1.14 With the rehabilitation of most existing irrigation systems either completed or under way, future irrigation development in Indonesia will shift to the construction of new gravity systems and swamp and tidal land development outside Java. This shift does not mean, however, that irrigation development on Java should stop. Many of the existing systems still need to be fully rehabilitated or upgraded at relatively low cost, and the limited potential for large storage and groundwater should be developed to expand dry season cropping as far as economically feasible. A recent Bank review of Indonesia's irrigation program concluded that to expand rice production along with demand at 4% per year, the level of investment in irrigation should be increased by about 20%. This in turn would require strengthening of the Directorate General of Water Resources Development (DGWRD), training and staff development, and an expansion of agricultural supporting services. The proposed project fits in well with these conclusions.

Project Formulation

1.15 Cipamingkis and Jragung are unrelated projects on the island of Java. While project works at Cipamingkis are for a single purpose, irriga- tion, those at Jragung are multipurpose and include irrigation, flood con- trol, municipal and industrial water supply, and hydroelectric power genera- tion. The construction of the works proposed under these two components has been combined with the hydrologic and water management programs to provide an appropriately sized loan package adaptable to normal supervision.

1.16 The proposed irrigation works at Cipamingkis and Jragung are a slight departure from the type of projects that GOI has undertaken with Bank assistance under the previous credits and loans. Irrigation Projects I through IX had as a major thrust, the rehabilitation of existing irrigation systems that had become severely deteriorated due to the lack of maintenance over a period of about 30 years following the advent of World War II. Cipamingkis would provide a new irrigation system in a predominantly rain- fed area; while Jragung by supplying dry-season water, would intensify irrigated cropping in a presently irrigated area. The last major irrigation system in Java needing improvement is being assisted under Irrigation VIII (Loan 1434-IND). Construction of new systems and intensification of existing systems is the next logical step to increase irrigated agricultural produc- tivity on Java, the most densely populated and developed area of the Indonesian archipelago. The proposed works support GOI's policy of improv- ing, extending, and intensifying agricultural production, and helping to meet a serious deficit in Indonesian foodgrain supply.

1.17 The Cipamingkis project would supply run-of-river irrigation water to a group of farmers near the Jatiluhur Irrigation Area (assisted by the Bank under Credits 195-IND and 514-IND). However, the proposed water supply for the Cipamingkis area is completely independent of those water sources which serve the Jatiluhur area.

1.18 Jragung Dam was identified in a major river basin study /1 GOI con- ducted to plan flood control and drainage works in the East Semarang area. The resulting master plan proposed several integrated works, including dams and reservoirs, drainage, flood channels and irrigation rehabilitation. The proposed Jragung Dam, and the ongoing SEDEKU drainage and irrigation works (Bank-assisted under Loan 1435-IND), are part of the proposed works. To

/1 The Jratunseluna River Basin, which is a group of five river basins, namely, Jragung, Tuntang, Serang, Lusi and Juana, studies for which were undertaken from 1970 to 1974 with consultant assistance (NEDECO) financed under bilateral aid from the Netherlands. -6-

fully utilize the potential of the Jragung site, in addition to flood con- trol, the proposed works would provide irrigation and municipal water sup- plies and hydroelectric power generation. Subsequently GOI, with consultant assistance (ECI) financed by United States bilateral assistance updated the NEDECO feasibility studies and undertook detailed design of the dam.

1.19 Besides providing flood control for 1,800 ha alongside the Jragung River's banks downstream of the proposed dam, the dam would also assist in the flood protection of the 30,000 ha SEDEKU area. The SEDEKU project works were designed assuming the construction of the Jragung Dam. Until the dam is constructed, the Jragung River 50-year flood would exceed the SEDEKU design flood by about 30%. Such a flood may breach or overtop some portions of the Jragung embankments designed to protect the SEDEKU area. Agricultural benefits from the dam would be limited to the 7,600 Jragung irrigation area, the 1,800 ha lying alongside the river and to the 1,100 ha near the coast that would benefit from return flows in the dry season.

1.20 GOI, with consultant assistance (Burns and McDonnell - Trans Asia Engineering Associates), has recently identified three alternative sources of municipal and industrial water supply for the city of Semarang, the Central Java provincial capital. These are Muncul Springs, Jragung Reservoir, and Penggaron Reservoir. Groundwater sources south of Semarang also appear promising, though probably in limited quantities. While, in terms of capital investment, Muncul Springs would be the least cost alter- native, the water from this source is already being used for irrigation and hydroelectric generation and only a limited quantity is available for municipal use. Development of groundwater is being studied with ADB assistance. Of the two reservoirs, GOI has chosen Jragung as the more economic, to supply some 63 MCM of water/year for Semarang. GOI considers this supply, in addition to the Muncul and groundwater sources also being developed, would meet Semerang's demand for water up to around 1990.

1.21 As presently formulated, the proposed works include a six megawatt (MW) capacity hydroelectric powerplant, which would produce 30 gigawatt hours (GWh) of energy annually; and a 17 km transmission line to tie the power produced into the main Central Java grid. The powerplant would be operated incidental to the other project functions, and no releases of water are proposed solely for power generation. However, the economic viability of the powerplant has yet to be fully established, and its inclusion in project works would be reviewed during detailed design.

1.22 Detailed design of the dam itself will not be completed until March 1979. The appraisal revealed that while sufficient investigations have been carried out to establish the technical soundness and economic viability of the dam, the remaining work would result in a more reliable cost estimate. Pro- ceeding with the initial stages as proposed in this project would not impact on remaining studies, but would advance the time when project benefits can be - 7 -

achieved. It was therefore decided to proceed on a "time-slice" basis under which the entire project would be appraised at this time, but financing under the loan would be provided only for the construction of the access road, base camp and diversion tunnel. Assurances have been obtained from GOI, that it would proceed with the construction of the dam and its appurtenant facilities in accordance with a time schedule to be agreed between the borrower and the Bank. These latter works would be considered for financing under future Bank loans.

2. THE PROJECT AREAS

Location

2.01 The Cipamingkis subproject area lies about 30 km southeast of Jakarta in the uplands above the main Jatiluhur project area in West Java. It is an essentially rural agricultural area lying about 10 km off the main Jakarta-Bogor-Bandung Highway. The Jragung Dam is located on the Jragung River about 20 km southeast of Semarang. The Jragung River drains a part of the northeastern slopes of the extinct volcano Gunung Ungaran (peak elevation 2,050 m). Its headwater is at elevation 1,250 m on the side of the volcano and the river profile drops rapidly to the coastal plain, at slopes of up to 200 m/km. Only one small village of about 400 population is located in the reservoir area. There are two very small hamlets below the damsite which would be affected by the spillway. It is proposed that these communities be located to higher ground as a part of dam construction. There would be no relocations as a consequence of the initial stage work included in this project. The irrigation service area lies in the northwestern part of the basin, between the Tuntang River to the east and the Dolok River to the west. The proposed project area of some 7,600 ha would be directly irrigated, while about 1,100 ha farther downstream would benefit from return flows during the dry season. The Directorate of Irrigation using local funds, or PROSIDA under Loan 1435-IND, have either recently rehabilitated or are currently rehabilitating the irrigation systems that would be provided water supply from the project. The Cimanuk River has its origin at Mount Puncak Gede at an elevation of over 2,000 m. Initially, it traverses the mountainous region east of Bandung, debouches onto the coastal plain below the proposed Jatigede Dam and flows northward into the Java sea below the town of Indramayu. Its total length is about 180 km. Total drainage area is about 3,600 sq km.

Climate

2.02 There is little variation in the tropical, monsoonal climate of Java, with temperatures varying only a few degrees around the annual average of 260 C. Mean annual precipitation ranges from 1,500 to 3,000 mm except in the highest areas, where it often approaches 5,000 mm. Seasonal weather patterns prevail with the wet season (northwest monsoon) extending from November to May and the dry season (southeast monsoon) from June through October. - 8 -

2.03 In the Cipamingkis subproject area, mean annual temperature is 25.40 C. Mean annual precipitation for the area is about 4,700 mm upstream of the Cipamingkis river and about 2,600 mm in the downstream area. Mean annual relative humidity is 82%, percentage of possible sunshine about 74%, and wind velocity slightly under 4 km/hr. Dry season rainfall is slightly higher than on the north coast plains, averaging from about 120 to 230 mm/month. Rice cannot be grown during the dry season without supplemental irrigation and secondary crops frequently suffer severe moisture stresss. Although there is only minor variation in day lengths throughout the year, photosensitive rice varieties have different growth durations during the wet and dry seasons.

2.04 In the Jragung subproject area mean annual temperature is about 260 C, with only minor variations from month to month. Precipitation over the drainage area above the damsite averages about 2,700 mm annually. Relative humidity ranges from 45 to 100% on a daily basis, with a monthly average of 85% in the wet season and about 75% in the dry season.

Soils

2.05 Although very little definitive information on soils is available for the Cipamingkis subproject area, a Bank soils expert reviewed the data, conducted a field inspection of the project area, and found the soils ideal for sustained irrigated rice cultivation. The soils are alluvium of volcanic origin having very fine clayey to fine silty texture in the surface horizon and low percolation rates. The subsurface horizon is comprised of very fine to fine clayey texture. Water holding capacity of the surface horizon ranges from about 25% to 50% with a moderate to high acidity.

2.06 Soil surveys of the proposed Jragung Dam irrigation service area were conducted by the Agricultural Institute in Bogor (IPB). The soils are heavy textured gray or brownish gray. They have low permeability and generally poor nutrient status which will require supplementary nitrogen and phosphorus to obtain high yields. The soils are considered to be good rice soils.

Population, Farm Size and Land Tenure

2.07 The Cipamingkis project area has an estimated rural population of 103,000 made up of about 16,000 farm and 2,800 landless laborers families. At Jragung, flood control and irrigation works would benefit about 158,400 people, consisting of some 20,200 farm and 8,600 landless laborers families. The following table shows population statistics and average farm size for each project area. 9 -

Flood pro- Average No. of No. of Average tection Irrigated Total rural family farm landless farm Subproject area area population size families families size (ha) (ha) (ha)

Cipamingkis - 7,600 103,000 5.5 16,000 2,800 0.5 Jragung 1,800 8,700 158,400 5.5 20,200 8,600 0.5

2.08 Farm size and land tenure data are sketchy. Information from local officials suggest an average farm size of 0.5 ha in both project areas. The following is a rough estimate of farm size distribution.

Farm size No. of farms Cultivated area (ha) …------M(%) …------

Cipamingkis Less than 0.5 59 29 0.5-1.0 32 43 1.0-2.0 6 19 More than 2.0 2 9

Jragung Less than 0.5 58 30 0.5-1.0 28 34 1.0-2.0 13 31 More than 2.0 1 5

2.09 At Cipamingkis, some 77% of farmers are owner-operators, and 23% sharecroppers, while at Jragung some 60% are owner-operators and 40% are sharecroppers. In most sharecropping arrangments, the tenant and landowner equally share total production, and input and harvesting costs, the tenant and his family provide their labor, and the landowner pays the land tax. Landless laborers comprise some 15% of the rural population at Cipamingkis, and 30% at Jragung.

Agricultural Support Program

2.10 The BIMAS program provides farmers with subsidized credit, ferti- lizer, agrochemicals; allowances for HYV seed, spraying and cost of living; and extension advice for crop production. Under the BIMAS program the Bank Rakyat Indonesia (BRI) is the main source of production credit. For irri- gated rice production, a farmer can obtain up to Rp 37,000/ha to cover seed, - 10 -

fertilizer, insecticide, rodenticide, spraying, and cost of living expenses. The loan is for seven months at 1%/month interest rate. To be eligible for the loan, a farmer must demonstrate a reliable cropping history and not be more than two years overdue with his earlier BIMAS repayments. At Cipamingkis, the BIMAS program covers some 50% of the wet-season paddy crop, and 30% of the irrigated dry-season crop. At Jragung it covers 15% of the wet-season paddy area, but does not operate in the dry-season.

2.11 The National Seed Corporation at Sukamandi (Credit 246-IND) pro- duces limited supplies of certified paddy seed. This is distributed through BUUD/KUDs at Rp 150/kg. This seed would be available at both Cipamingkis and Jragung. In both subproject areas, seed growers who obtain their planting material from district seed farms of the provincial agricultural services, supply most or all available certified seed. The Directorate-General of Cooperatives (DGC) operates two BUUDs at Cipamingkis and four at Jragung. BUUDs are precooperatives which convert to farm cooperatives, or KUDs, when proven viable. The cooperatives distribute fertilizer and agrochemicals, and provide such processing services as paddy drying and cleaning, in addition to storage. At each BUUD/KUD, the BRI establishes an office to handle BIMAS loan applications and repayments.

2.12 In both project areas, staff of the Directorate of Food Crops Agriculture within the Ministry of Agriculture (MOA) provide extension ser- vices to farmers. Due to shortages of staff, the extension services are currently providing advice largely to farmers participating in the BIMAS program. The National Food Crops Extension Project (NFCE) (Loan 1267-IND) is correcting this deficiency. Presently extension services at Cipamingkis consist of one new rural extension center (REC), one middle-level extension worker (PPM), and seven field extension workers (PPLs). Jragung project area has only minimal services with some three PPLs stationed there.

Existing Works and Infrastructure

2.13 Cipamingkis. A semipermanent weir on the Cipamingkis River was constructed during the colonial period and rehabilitated by GOI in 1974. It serves as a headworks for the 500 ha existing semitechnical /1 irrigation system in the subproject area. The remaining area is rainfed or flooded from primitive village systems. The engineering and economic potential for incorporating the existing weir into the subproject scheme would be explored in the course of detailed design prior to construction.

2.14 Interior roads in the Cipamingkis area are neither extensive, of a high standard, nor well maintained. Many are passable to motorized vehicles only during the dry season. The poor condition of the roads adversely affects the ability to distribute agricultural inputs in a timely fashion as well as the marketing of agricultural production.

/1 Semitechnical irrigation refers to partially developed and controlled systems. - 11 -

2.15 Jragung. Water supplies are diverted from the Jragung River at Jragung weir for some 2,000 ha and from the Tuntang River at Glapan weir for 1,200 ha in the subproject area. During the wet season the remaining 4,400 ha grow rainfed crops, however no dry season irrigation supplies are available from either weir. With construction of Jragung Dam, water diverted at Jragung weir would irrigate 6,400 ha in the wet season and Glapan weir would continue to irrigate 1,200 ha. However, during the dry season, Jragung weir would supply water to both the 6,400 ha and 1,200 ha areas. The exist- ing irrigation infrastructure was constructed some 50 or more years ago. Glapan weir and the western main Glapan canal, were rehabilitated under Credit 127-IND. Silting and slides have reduced the capacity of the Jragung main canal, and secondary and tertiary canals throughout the service area are in poor repair and inadequate for intensive cropping. However, under Loan 1435-IND and locally funded works, money has already been allocated for the rehabilitation of the 3,200 ha service area and the construction of 4,400 ha of new service area. These works would be completed in time to use water from the proposed Jragung Dam.

3. THE PROJECT

3.01 The proposed project would include:

(a) construction of a weir, headworks and primary canal, improvement, enlargement and extension of secondary canals and construction of tertiary canals to serve about 7,600 ha in the Cipamingkis area of West Java (Map 13144);

(b) construction of an access road, base camp and diversion tunnel as the first stage of construction of Jragung Dam in Central Java (Map 13531);

(c) construction of measurement stations and provision of consulting services to improve and accelerate the existing hydrologic program in support of the planning, design and operation of water resource projects throughout Indonesia; and

(d) provision of consulting services to prepare a master plan and detailed designs for the conservation and development of the water resources of the Cimanuk River Basin, West Java (Map 13142).

The project would also include consulting services for design of the Cipamingkis system and supervision of construction for the Cipamingkis and Jragung subprojects; construction of a telecommunications system, offices and housing at Cipamingkis; procurement of essential vehicles and equipment and training of project staff, especially for the Cipamingkis subproject and the Hydrologic Measurement Program. - 12 -

The Project Works

3.02 The project works for each of the subprojects can be summarized as follows:

3.03 Cipamingkis. The proposed works include construction of a gated concrete overflow weir with a hydraulic height of 2 m and crest length of 48 m flanked by earthen embankment dams. Weir facilities would include gated headworks to serve the two main canals to be constructed on the left and the right banks. About 4.5 km of access road to the weir site would be constructed.

3.04 The irrigation system would involve construction of the unlined main canals with a total length of about 19 km; about 44 km of secondary canals; and about 215 km of tertiary canals serving about 50 blocks of land averaging about 150 ha each and totaling 7,600 ha. About 230 structures consisting of checks, drops, culverts, diversions and bridges would be con- structed as part of the irrigation system.

3.05 Because of the undulating character of the project area, significant drainage problems are not anticipated. However, the project would provide drainage for about 2,300 ha where natural drainage cannot accommodate the additional requirements from fully irrigated agriculture.

3.06 Jragung Dam. This subproject includes extension and improvement of an existing highway to serve as the main access road to the damsite; construc- tion of a 4.0 m inside diameter tunnel 400 m long and a connecting 400 m open channel to provide for diversion of the Jragung River during construction of the dam proper; and the construction of the base camp required for subsequent dam construction.

3.07 Road improvement and construction would require about 130,000 cu m of excavation and backfill, 200,000 cu m of macadam, 1,200 cu m of concrete and masonry for structures and drainage and acquisition of about 12 ha of land.

3.08 The base camp would include a motor pool compound, camp and staff housing and offices, mess halls and a generator housing building. About 26 ha of land would have to be acquired.

3.09 Hydrologic Measurement Program. The Hydrologic Measurement Program is designed to overcome a significant deficiency in historic planning, design and operation of water resource developments in Indonesia due to a lack of reliable streamflow data. The program is directed to the collection of such data for utilization in near- and mid-term planning and designs for identi- fied high priority potential developments. It would supplement a UNDP tech- nical assistance project directed to institutional development and implemen- tation of a national hydrologic network.

3.10 The work involved in this program includes the construction and equipping of 120 stream flow measuring stations, 20 climatological stations, - 13 -

and 40 rainfall stations. In addition, equipment would be provided to record water level fluctuations in about 20 observation wells and for about 18 crews to service, maintain and obtain records at the above-mentioned measurement network scattered throughout Indonesia.

3.11 Automatic data processing (ADP) and printing equipment will be furnished for the central office of the Directorate of Hydraulic Engineering (DPMA) in Bandung for the processing, compilation, analysis and publication of the data obtained through this and similar programs under DPMA.

3.12 Technical assistance in the fields of hydrometeorology, hydrology, sedimentation and ADP equipment utilization and operation would be provided to assure effective implementation of the program.

3.13 The number, type and location of hydrologic and climatologic measurement stations included in the program were determined from the coordi- nated needs of the individual agencies under the DGW7RD. The ADP and printing equipment are supplemental to existing equipment and represent requirements to eliminate a backlog of from 5 to 7 years in the compilation and publication of hydrologic data.

3.14 Cimanuk River Water Management Program. The Cimanuk River Water Management Program would be the first involvement by the Bank Group in Indonesia for the development of a master plan for the management of the land and water resources of an entire river basin. It would involve the review, analysis and coordination of all existing and largely unintegrated plans for water and land resource development in the basin and evolve an integrated and coordinated plan for the utilization, conservation and management of those resources.

3.15 A number of studies, ranging from reconnaissance through detailed design have been completed or are under way, covering specific potential water and land resource development. Principal among these is the Jatigede Dam, which would be a major multipurpose facility on the Cimanuk River, and is currently in the detailed design stage through Australian bilateral assistance.

3.16 A large number of additional studies for small developments in the basin have also been prepared by the DOI and Provincial Public Works, and a plan for management of the upper watershed has been proposed by the Directorate of Forestry and Land Rehabilitation in the Ministry of Agriculture. All of these plans, investigations and studies would be re- evaluated and blended into an integrated program for development under the Master Plan to evolve from this project.

3.17 The New Rentang Barrage on the Cimanuk River is being assisted uner Irrigation VI (Loan 1100-IND) and the contract for construction of the barrage is scheduled for award in May 1978. A plan for flood protection on the lower Cimanuk River below New Rentang Barrage has been completed, but - 14 -

designs require additional review before a final implementation plan can be adopted. In addition, plans for flood control on the Cipanas and Ciwaringin rivers adjacent to the lower Cimanuk River have also been completed but designs need to be reviewed.

3.18 Deferral of the power function from the proposed Jatigede Dam on the upper Cimanuk River will permit that facility to serve an additional irri- gation area of about 20,000 ha, and reconnaissance studies of a plan for that purpose will be undertaken.

3.19 The project includes technical assistance to develop the master plan, for the review and completion of designs for flood control for the lower Cimanuk, Cipanas and Ciwaringin rivers and for the irrigation recon- naissance and feasibility study of the 20,000 ha area. However, assurances have been received from GOI that completion of the flood control designs and initiation of the feasibility study would be contingent upon Bank approval, following completion of the review and reconnaissance activities respectively.

Water Supply, Demand and Quality

3.20 Cipamingkis. The subproject area will be supplied by direct diver- sion from the Cipamingkis River. As river runoff records at the diversion site are available for only a short period of time, the flows in the river have been determined by correlation with data from the adjacent Ciliwung River. Reliable precipitation and discharge records for this river estab- lished runoff coefficients for the region which, together with recent limited data for discharge and precipitation for the Cipamingkis basin, established estimated average monthly flows at the diversion site. Approximately 49 years of record were utilized to establish the average monthly flows. In computing water availability, average monthly flows with 80% reliability have been used.

3.21 The consumptive crop-water requirements for the proposed cropping pattern were determined by using the Hargreaves method which has been espe- cially adapted for use in Indonesia and adopted by the DGWRD for general use. The projected cropping calendar is shown in Figure 5.1. The effective rainfall has been established as the 80% probability of monthly precipitation at Cibarusa which is centrally located in the project area. An overall efficiency of 60% in water use has been assumed. The water balance compu- tation is presented in Table 3.1. Adequate water supplies are available in all months except September. However, deficiencies in that month are only 8% of the total water requirement. Planting of rice and other crops will be staggered to accomodate to the available water supply. During the dry season the paddy area will be limited to about 2,000 ha. Secondary (palawija) crops with low water requirements, short growing season and for which a ready market exists in Jakarta have a good potential as substitute crops for rice.

3.22 Because the project would not include storage, there will of course be years with more severe shortages than shown in Table 3.1. However, in - 15 -

4 out of 5 years, the water supply will be greater. Under the assumed cropping pattern, the maximum diversion requirement would occur in December when approximately 2.2 cu m/sec would have to be diverted from the available supply of about 5.4.

3.23 Jragung Dam. Water supply for this subproject would come from three sources: the Jragung River, transbasin diversion of up to 6.5 cu m/sec of surplus flow from the Tuntang River to Jragung Reservoir, and diversion of additional irrigation water in the wet season to the Jragung irrigation area through the Glapan weir. Diversion from the Tuntang River would be through a one kilometer concrete lited tunnel.

3.24 In addition to providing a full dry-season irrigation supply for 8,700 ha, the total project would also include the provision of 63 MCM of water annually to supplement the existing municipal water supply for Semarang.

3.25 Both the Jragung and the Cipamingkis rivers at the respective points of diversion have water of excellent quality for irrigation. For municipal and domestic purposes, the water from Jragung Dam would require only some continuous chemical treatment such as clorination and filtration to remove suspended sediments during flood periods.

Status of Engineering

3.26 Cipamingkis. Aerial surveys and topographic mapping of the area is currently underway and is scheduled for completion in 1978 with assistance provided under Loan 1268-IND. Detailed design of the Cipamingkis weir, and the primary and secondary canal system has been essentially completed by the Planning and Design Staff of the Authority. Field surveys have been com- pleted and were utilized for site specific design and quantity estimates. Foundation drilling and material investigations at the weir have also been concluded. Design of the tertiary system would be accomplished by the staff of the authority.

3.27 Jragung Dam. For the initial stage proposed for construction in this project, detailed designs and construction drawings for the diversion tunnel are essentially completed. The same documents for the access road and base camp are scheduled for completion in June 1978. Detailed design of the dam is scheduled for completion in March 1979. A number of geologic faults have been located and investigated at the damsite. None of them show any recent displacements. Extensive analyses have also been made of possible earthquake effects. Studies of these factors indicate that the dam and appurtenant structures are geotechnically feasible. The characteristics of the site will be taken into consideration in the preparation of final designs.

Implementation Schedules

3.28 The project would be implemented over a period of 4 years, during which the second stage of the Jragung Dam subproject would be initiated, - 16 -

possibly under a future loan. The schedules for each of the project construc- tion components are presented in Figure 3.1.

Cost Estimates

3.29 Total project cost is estimated to be US$47.4 million of which US$26.9 million (57%) is the foreign exchange component. Because of the tax exempt status of the implementing agencies, the costs do not include provi- sion for local, provincial and national taxes. Unit prices are based upon recent contract prices for similar works in Java. The base cost estimate is expressed in mid-1978 prices. Physical contingencies of 25% have been applied to the civil works and right-of-way costs for the Cipamingkis sub- project and the Hydrologic Measurement Program due to the amount of work that has not been carried to the detailed design stage. Although detailed design for the preliminary works at Jragung Dam have been completed, the uncertainty of tunneling dictated that a contingency factor of 40% be utilized for that work, and 15% for the access road and base camp. Contingencies of 10% and 20%, respectively have been applied to the costs of vehicles and equipment, and services. Expected price increases over the implementation period total about 26% of the base cost estimate plus contingencies assuming the following calendar year inflation rates:

Annual Inflation Rate (%) 1978 1979 1980 1981/82

Civil Works 14 12 10 8 Equipment and Services 8 8 8 7

Details of the cost estimates are contained in Annex 1 and are s-ummarized in Table 3.2. The total project cost for Jragung Dam, including the second stage and expected price increases, are also presented in Annex 1.

3.30 Engineering and administration costs amount to about 5% of the base cost estimate. Costs of consulting services are based on recent contracts signed in Indonesia for similar services with local and foreign firms. The direct costs of foreign consultants (salaries, overseas allowance and company overhead and fee) amount to about US$6,500 per man-month. Including indirect costs (travel, housing, office and miscellaneous expenses), the total cost would be about US$8,000 per man-month. Total costs of local consultants would be about US$1,200 per man-month.

Financing

3.31 The proposed loan of US$31.0 million would finance about 65% of the total project cost and would cover the full foreign exchange costs (US$26.9 million), and US$4.1 million of local costs. GOI would provide the remaining Rp 6,810 million (US$16.4 million) to the executing agencies out of annual budget appropriations. - 17 -

Procurement /1

3.32 Of the 56 vehicles to be acquired under the project, a total of 27 will be required for use by consultants and will be procured by coirretitive means other than ICB (10 for start-up - to be purchased locally through the consultants services category - and 17 through international shopping). All the remaining vehicles, as well as equipment for construction and operational purposes (US$2.8 million), would be procured under international competitive bidding procedures in accordance with the Bank Group guidelines. A preference equal to 15% of the c.i.f. cost of the imported goods or the customs duty, whichever is lower, would be extended to qualified local manufacturers in the evaluation of bids. Vehicles for consultants and items of equipment costing less than US$10,000 each and limited to a total of US$400,000, which are not suitable for ICB, would be purchased through normal GOI procedures, which have been found acceptable to the Bank. There are sufficient suppliers of such goods to ensure adequate competition. All contracts for vehicles and equipment exceeding US$100,000 in estimated value would be submitted to the Bank before bidding and award.

3.33 Construction of the major works for the Cipamingkis subproject, including the weir, primary and secondary canals and structures, roads, and drainage systems (US$11.8 million), and the initial works for Jragung Dam (US$5.5 million) may be of interest to international contractors. Contracts for these works would be awarded on the basis of international competitive bidding in accordance with Bank guidelines. Civil works con- tracts at Cipamingkis would be packaged into about three contracts and for Jragung into about two contracts. Qualified local contractors would be given a preference of 7-1/2% in evaluation of bids.

3.34 The remaining civil works for Cipamingkis (US$4.8 million), involv- ing small-scale construction activities (tertiary development, offices and housing) scattered over a wide area, and the construction of measurement stations at almost 200 locations throughout Indonesia for the Hydrologic Measurement Program (US$2.0 million), would not be of interest to international contractors. These works would be carried out following local competitive bidding or, in the case of tertiary and quaternary canals and drains, through the INPRES rural works program. While local contracting procedures have been reviewed under earlier projects and are acceptable to the Bank, assurances have been obtained from GOI that: (a) to avoid late construction starts during the dry season, bids could be received and processed without waiting for the project implementation budget (DIP) to be signed, but contract award and execution would be deferred until after the DIP is approved; and (b) price escalation clauses which are not normally provided in local civil works contracts would be included in contracts extending beyond one year. For civil works contracts estimated to cost US$1 million and above, documents would be submitted to the Bank for review before tendering and award.

/1 All costs in this section of the report include contingencies. - 18 -

escalation clauses which are not normally provided in local civil works contracts would be included in contracts extending beyond one year. For civil works contracts estimated to cost US$1 million and above, documents would be submitted to the Bank for review before tendering and award.

Disbursements

3.35 Disbursements would be at the rate of 100% against the foreign exchange cost of training and directly imported vehicles and equipment, 95% of the ex-factory cost of locally manufactured equipment, 65% for locally procured imported equipment, excluding vehicles, and 40% of total expendi- tures for locally procured vehicles. Disbursements for both foreign and local consultants would be at 100% of total expenditures to encourage the use of local consultants and to enable the executing agencies to engage consul- tants expeditiously, since prior budgetary allocations would not be needed. For civil works contracts, excluding tertiary networks, disbursement would be made at a rate of 70% of total cost. For tertiary construction, disburse- ments would be made against 100% of the cost of structures, but no disburse- ments would be made for earthworks. Disbursement for tertiary structures would be made only if the withdrawal application is accompanied by a certif- icate from the site engineer stating that the tertiary and quaternary canals and drains in the tertiary block had been completed. The estimated schedules of expenditures, disbursements, and allocation of the loan proceeds are presented in Annex 1. It is proposed to provide US$500,000 of retroactive financing to provide for a review of plans for flood control on the Cimanuk, Gipanas and Ciwaringin Rivers to be accomplished prior to loan signing, and for the services of the expert on river control and management.

Accounts and Audits

3.36 Assurances have been obtained from the Government that the imple- menting agencies would: (a) maintain separate accounts for this project, (b) engage auditors acceptable to the Bank, and (c) submit audited financial statements, along with the auditors comments and opinions to the Bank within six months of the close of each fiscal year.

Environmental Effects

3.37 During construction of the proposed Cipamingkis irrigation system there would be a temporary disruption and scarring of the right-of-way of canals and the weir site. This would be short lived and not cause any major nonreversible impacts upon the environment. For the Jragung subproject the work proposed would have a similarly temporary environmental impact over a considerably smaller area. However, the second stage involving the contruction of the dam would permanently inundate about 600 ha of land.

3.38 There are no known unique environmental factors in any of the areas affected by the project. None of the project areas have endemic schistoso- miasis or malarial problems and none would be induced due to project activi- ties. The impact upon the human environment would be positive. In their use of pesticides farmers would have to exercise care not to contaminate fish or domestic water supply. Table 3.1: CIPAMINGKIS SUBPROJECT WATER BALANCE

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 31 28 31 30 31 30 31 31 30 31 30 31

Potential Evapotranspiration mm 66.5 62.7 72.4 83.7 84.4 95.6 96.9 114.6 108.2 110.0 90.5 74.0

Crop Coefficient (Rice) Area A 1.19 0.66 ------0.91 1.14 1.28 Area B 1.28 1.19 0.66 - - - - - 0.91 1.14 Area C 0.91 1.14 1.28 1.19 0.66 - - - - -

Consumptive Use mm Area A 79.1 41.4 - - - - - _ _ 100.1 103.2 94.7 Area B 85.1 74.6 65.9 ------82.4 84.4 Area C 65.9 95.5 108.0 113.8 64.0 - - - - -

Land Preparation & Nursery mm Area A ------52.5 127.5 - - Area B - - - - _ _ _ _ - 52.5 127.5 _ Area C 52.5 127.5 ------

Percolation mm Area A 31.0 28.0 - 90.0 62.0 60.0 62.0 Area B 62.0 28.0 31.0 ------93.0 60.0 62.0 Area C 84.0 62.0 60.0 62.0 30.0 31.0 - - - - -

Effective Rainfall mm 232.0 194.0 207.0 204.0 126.0 16.0 80.0 32.0 76.0 172.0 203.0 103.0

Irrigation Requirement mm Area A ------66.5 117.6 - 53.7 Area B ------66.9 43.4 Area C - _ 48.4 - 44.0 127.8 15.0 - - - - -

Water Requirement Area A MCM - - -_ - 1.928 3.410 - 1.551 Area B MCM - - -_- - - - 3.144 2.040 Area C MCM - - 0.968 - 0.880 2.556 0.300 - - - -

Total MCM - - 0.968 - 0.880 2.556 0.300 _ 1.928 3.410 3.144 3.597

Total /a cu m/sec - - 0.60 - 0.55 1.64 0.19 _ 1.24 2.12 2.02 2.24

Available Supply cu m/sec 8.00 8.37 8.28 9.09 5.00 2.09 1.77 0.73 1.14 2.64 4.50 5.41

Water Balance cu m/sec + + + + + + + + -0.10 + + +

Shortage (%) ------8 -

/a Conversion includes factor for 60% overall efficiency.

Note: Area A is early wet-season rice on 2,900 ha. Area B is late wet-season rice on 4,700 ha. Area C is dry-season rice on 2,000 ha. Secondary dry-season crops will be grown on 3,000 ha utilizing residual moisture. Table 3.2: SUMMARY COST ESTIMATE

Foreign Local Foreign Total Local Foreign Total exchange - --- (Rp million) ------(US$ million) ---- (%)

Cipamingkis Subproject 3,460 3,380 6,840 8.2 8.3 16.5 50

Jragung Subproject - 1st Stage 1,070 1,250 2,320 2.6 3.0 5.6 52

Hydrologic Measurement Program 620 1,580 2,200 1.4 3.9 5.3 74

Cimanuk River Water Management Program 370 1,240 1,610 0.9 3.0 3.9 79 o

Base cost estimate 5,520 7,450 12,970 13.1 18.2 31.3 58

Physical contingencies 1,260 1,470 2,730 3.0 3.6 6.6 55

Expected price increases 1,830 2,110 3,940 4.4 5.1 9.5 54

Total project cost 8,610 11,030 19,640 20.5 26.9 47.4 56 - 21 -

4. ORGANIZATION AND MANAGEMENT

Project Management

4.01 Four separate entities will be responsible for the implementation of the various parts of this project. As the Cipamingkis subproject area falls within the Jatiluhur Region, it would be implemented by the Jatiluhur Authority, a semi-autonomous Government corporation under the jurisdiction of the Ministry of Economy, Finance and Industry. The Jatiluhur Authority is presently entirely responsible for the execution of two Bank-assisted projects (Credits 195 and 514-IND) and for a portion of another (Loan 1268-IND). Works on Credit 195-IND will be completed this year; most of the main contracts under Credit 514-IND have been or will shortly be awarded; and works under Loan 1268-IND, mainly the construction of tertiary systems, are scheduled to be completed by mid-1979. The Authority is well managed and, based upon its success in implementing the ongoing projects, should have no difficulty in executing the works proposed under this project.

4.02 The Jragung dam subproject would be managed by PROSIDA, an executive body within the Directorate-General of Water Resources Development (DGWRD), which has been the executing agency for most components of the remaining Bank Group-assisted irrigation projects in Indonesia. Since its establishment in 1969, PROSIDA has demonstrated an increasing capability to plan and execute irrigation projects and has gained the reputation of being one of the most efficient construction agencies in the Indonesian government. The capability of PROSIDA to successfully carry out its responsibilities under this project has been established by prior performance.

4.03 A new executive body, Proyek Hidrologi, is in the process of being established to implement the Hydrologic Measurement Program. While organiza- tionally distinct from the existing Directorate of Hydraulic Engineering (DPMA), Proyek Hidrologi would share its management, facilities and most of its staff with DPMA. The Director of DPMA would become jointly General Manager of Proyek Hidrologi and the head of the Subdirectorate for Hydrologic Services in DPMA would become jointly the Deputy General Manager. DPMA is located in Bandung, West Java. Its headquarters and laboratory facilities are modern and efficient and it has been operationally and institutionally streng- thened by bilateral assistance as well as a UNDP-assisted project (para. 3.09). It is the principal hydraulic engineering organization under the DGWRD but funding constraints have limited its ability to establish and maintain measure- ment stations to provide adequate hydrologic data and to effectively analyze and publish the hydrologic data that it does collect. With the assistance of advisers, to be engaged under the project, the reorganized DPMA staff would be capable of implementing the project and operating the systems to be established in an efficient manner.

4.04 The creation of a new executive body to implement this component has been taken as the only practical solution to the constraints faced by the DGWRD in modifying its organizational structure to cope with an expanding program of work and in attracting and retaining staff of the necessary calibre. Executive bodies can be established by the Minister of Public Works (whereas establishment of a new Directorate or Subdirectorate would require the assent - 22 -

of the President, a very time-consumingprocedure). The Minister can also establish terms and conditions of employment within executive bodies above the level obtaining in the line agencies and thereby attract and retain the skilled staff needed for complex projects such as this. By the use of joint appointments,such as those described above for Proyek Hidrologi, the flow of informationand the coordinationof work assignments between the executive bodies and the line agencies can be maintained. The DGWRD recognizes that the establishmentof new executive bodies, in addition to those now existing, is not an optimal organizationalarrangement. Discussions are continuing within the Government and with the Bank on an organizationalstructure which would, among other things, provide for the greater integration of activities under Bank Group-assistedprojects with those of the DGWRD as a whole.

4.05 Execution of the Cimanuk River Management Program would also be entrusted to a new executive body, for the reasons that have just been discussed above. Proyek Cimanuk is being established using the same management and largely the same staff as the line agency, the Directorate of Rivers (DOR), which has been handling the planning and design of flood control works in the Cimanuk basin up to now. DOR is a well-established agency with respon- sibility for flood control and sediment control in natural and manmade channels throughout Indonesia. With the consultant and advisory assistance to be provided under the project, the reorganized DOR staff would be capable of implementing the Program.

4.06 Organization charts for the Directorate-General of Water Resources Development and the three implementing agencies under its jurisdiction are shown in Figures 4.1, 4.2, 4.3 and 4.4. The organization of the Jatiluhur Authority is presented in Figure 4.5. Assurances have been obtained that the Government would, before making any new appointment to the position of President Director of the Jatiluhur Authority or of the General Manager of PROSIDA, Proyek Hidrologi or Proyek Cimanuk, inform the Bank of the names, qualifications and experience of the persons considered for such appointment and would afford the Bank a reasonable opportunity to exchange views with the Government on the qualifications and experience of such persons; and also, that the Government would cause the above agencies to be adequately staffed at all times with competent and qualified personnel.

Consultants, Advisors and Training

4.07 The project includes assistance for the funding of consultants to complete detailed designs, prepare construction drawings and tender documents and to supervise construction for the Cipamingkis subproject. GOI has indicated that it intends to utilize Nippon Koei Co. (Japan), which is presently engaged by the Jatiluhur Authority for ongoing work related to Cipamingkis for the above-mentioned work. For the Jragung Dam, detailed designs will be completed by consultants financed by USAID. GOI intends to engage the same consultants (ECI) to supervise construction of the initial phase works included in this project. An additional adviser would be recruited to advise the Provincial Director of Public Works on the coordination of activities in the Jratunseluna area. - 23 -

4.08 For the Hydrologic Measurement Program, two hydrologistsand one hydrometeorologistwould be engaged as advisers for a three-yearperiod. An advisor on sedimentationlaboratory equipment and operation would be engaged for 18 months and one on hydrometric automatic data processing equipment operation for 6 months. For efficiency,cost effectivenessand coordination, these advisors would be recruited from a consulting firm with the capability to provide additional back-up assistance to the advisers.

4.09 For the Cimanuk River Water Management Program, consulting services are provided for the preparation of the master plan and for the review and completion of plans and designs for flood and sediment control on the lower Cimanuk River below New Rentang Barrage and for the Cipanas and Ciwaringin rivers. GOI has indicated that it intends to engage Snowy Mountains Engi- neering Corporation (Australia)for these activities. In addition, a long- term (two years) advisor on river control and management would be engaged

4.10 Engagement of all consultantsand advisors would be on terms and conditions acceptable to the Bank, and assurances have been obtained from GOI that consultants and advisors would be engaged by November 30, 1978. Con- sulting services and training to be provided under the project are shown below. Training would be provided through contractual arrangementswith the foreign consultants. It would include short-termacademic training on spe- cific project related activities and home office work-trainingassignments. Details of the training activities would be identified following the engage- ment of consultants.

4.11 An assurance has also been obtained that the Borrower would (a) cause DGWRD to appoint a panel of consultants,whose qualificationsand experience would be acceptable to the Bank, to review the planning, design and constructionof Jragung Dam (and any additional dams as may be agreed between the Borrower and the Bank) throughout the period of planning, design and constructionof such dams, to ensure the quality of their designs and safety; and (b) cause such panel to be consultedprior to the executionof all major changes in the design or constructionof any of the said dams.

Table 4.1: CONSULTING SERVICES AND TRAINING

Field Con- investi- Total sultants gations Training Foreign Local

- …------(US$ 000) ------(Man-months)

Cipamingkis 900 800 100 95 - Jragung Dam 600 400 200 - 65 - HydrologicMeasurement Program 1,500 1,200 300 140 15 Cimanuk River Water Management Program 2,900 2,900 - 280 300

Total 5,900 5,300 200 400 590 315 - 24 -

Agricultural Support Services

4.12 In order to attain the full future benefits of the proposed subproj- ects, agricultural support services need to be strengthened in the project areas. While this project does not contain assistance to any agricultural support program, GOI has several ongoing programs which it would expand at Cipamingkis and Jragung. The Bank is assisting GOI in upgrading some of these programs, such as the extension service through Loan 1267-IND, the Natonal Food Crops Extension Project (NFCE), and medium-term credit services through Credit 480-IND, and the proposed Rural Credit Project. The Bank is also discussing with GOI the introduction of several other programs to improve agricultural supporting services, such as building village fertilizer stores, upgrading the management and operation of farmer cooperatives, and a second agricultural research project. Domestic fertilizer production would continue to grow with assistance from the Bank Group (Credit 193-IND and Loan 1089-IND), and the fertilizer distribution project (Loan 1139-IND) would aid fertilizer distribution from the national to the district level.

4.13 The MOA, BRI and DGC would supply agricultural supporting services in the project areas. The recently introduced NFCE project would intensify and expand extension services by reorganizing and increasing the number of field extension workers (PPL) to provide one for each 1,700 farm families. The PPLs would be supervised by middle-level extension workers (PPMs), and subject matter specialists (PPSs) at the district level would support and train both the PPLs and PPMs. The PPSs would also conduct adaptive research at the district and subdistrict levels. The BIMAS Secretariat, within the MOA, would expand the BIMAS program (subsidized credit to cover seed, ferti- lizers, pesticides, crop spraying and cost of living expenses) at both project areas. BRI, which provides credit for the BIMAS program, would increase its field staff at existing village unit offices, and where necessary, build and staff new village unit offices. Besides providing farmers with production credit through the village unit, BRI would also supply longer term credit (three to five years) for the purchase of draft animals, ploughs and other required farm equipment. Where necessary, the DGC would establish BUUD/KUDs and village fertilizer stores (kiosks) to handle fertilizer and pesticide distribution at the retail level. The BUUD/KUDs would be equipped with paddy drying floors, grain warehouses, and rice milling facilities. By purchasing paddy from farmers, they would also undertake their usual task of maintaining GOI's paddy support price at the farm level.

4.14 At full development, demand for fertilizer would rise from its current level of some 1,000 tons to 2,700 tons/year at Cipamingkis; and from 1,600 tons to 4,400 tons/year at Jragung. At present, farmers use mainly urea (80%), and triple superphosphate (20%) and it is expected that this ratio would continue under the project. While the existing fertilizer supply channels could handle the increased demand, subdistrict roads would require repairing and upgrading to help improve the distribution efficiency at the village level. This would be done under the INPRES program. The annual demand for certified rice seed would be 100 tons at Cipamingkis and 200 tons - 25 -

at Jragung at full development. To meet these targets, the quality of local seed growers' production would be upgraded under the provincial agricultural service's ongoing work. After project completion, production credit require- ments would also rise. At Cipamingkis, the annual project area short-term production credit needs would be around Rp 350 million at Cipamingkis, and Rp 560 million at Jragung. At present farmers receive estimated annual BIMAS funds of Rp 160 million at Cipamingkis and Rp 25 million at Jragung. While BRI would be able to supply these additional funds, it would have to increase its field staff, and, particularly at Jragung, build and staff new village units to handle the increased credit flows and avoid delays in processing and issuing the credits. The BRI has been gradually improving its services to farmers, and it is expected to continue doing this, and provide the addi- tional field staff and facilities. To ensure that farmers' needs for advice, credit, and agricultural inputs would be provided in the project areas, assurances have been obtained that GOI would take the necessary steps to ensure adequate and timely credit and other agricultural inputs (including fertilizer, agricultural chemicals and certified seed) are made available at the village level in the Cipamingkis subproject area and assist in the provision of drying and storage facilities.

4.15 The extension service, in cooperation with the Provincial Irrigation Services and Ministry of Home Affairs, would form farmer groups (water-user associations) for extension, production planning, water management, and ter- tiary and quaternary unit construction in each tertiary unit. The quaternary unit, comprising some 20 to 40 farmers, would be the group's basic unit. As they have been vital in synchronizing crop calendars and water supplies, assurances have been obtained from GOI that a water-user association would be formed for each tertiary unit in the Cipamingkis area to participate in the unit's construction and to take over its operation and maintenance after project completion.

Operation and Maintenance

4.16 The Jatiluhur Authority would be responsible for operation and maintenance (O&M) of the Cipamingkis subproject during construction. This responsibility would continue for the weir and primary and secondary canals following completion of construction, while the farmers would assume respon- sibility for the tertiary system. Tertiary O&M would be accomplished through the formation of water-user associations embracing tertiary blocks of about 150 ha each. Farmers would pay about 50 kg of paddy/ha to fund the full O&M costs of these systems. Operation of the Hydrologic Measurement Program would continue to be the responsibility of DPMA.

4.17 As noted in Figure 4.5, the Jatiluhur Authority has a Division of Operation and Maintenance. Field operations are divided into four geographic districts, each headed by an O&M engineer. The maintenance section of the O&M Division would be responsible for the upkeep of the weir and primary and secondary canals including structures and embankments. Major repairs would be carried out by contract. - 26 -

4.18 Although there have been considerable improvements in 0&M services in the completed and ongoing Bank-assisted irrigation projects in Indonesia, there is still a need for more trained staff, as well as an increase in O&M budgetary allocations. The amounts of O&M funds received in FY77/78 by the various irrigation subprojects were in line with those agreed upon during negotiations of Loans 1434/1435-IND, and at least half of the funds were released by August 15, 1977. For FY78/79, GOI has increased the O&M alloca- tion for rehabilitated systems from Rp 3,200 to Rp 3,500/ha, and is consider- ing the implementing agencies' request for additional staff. Assurances have been obtained from GOI that: (a) adequate O&M funds, adjusted to keep pace with inflation and actual needs, would be allocated in future years for all Bank-assisted irrigation projects; (b) GOI would take the necessary steps to ensure that at least half of the budgeted O&M funds would be released to the subprojects by August 15 of each year and the balance, in equal quarterly installments thereafter, until the total amounts are fully released; (c) to upgrade the standard of 0&M services and to effectively utilize the available funds, GOI would progressively increase the number of qualified O&M personnel in the Bank-assisted projects until the additional numbers to be established by GOI in consultation with the Bank are employed; (d) GOI would inform the Bank by December 31 of each year of the proposed number of O&M personnel and per hectare 0&M budget for each subproject; and (e) by June 1 of each follow- ing year, it would submit the approved 0&M budget and by October 1, the staffing provisions.

4.19 For the Hydrologic Measurement Program it is essential that the measurement stations and equipment are properly and continuously operated and maintained. Assurances have been obtained from GOI that adequate O&M staff and funds, adjusted to keep pace with inflation and actual needs, would be allocated in future years to continue the operation and maintenance of the measurement stations.

Monitoring

4.20 A program to monitor benefits accruing from Bank-assisted irriga- tion and drainage works, together with other social aspects, is currently being implemented under Loan 1100-IND. As that program is expanded it would include this project, with additional required funds provided under a subse- quent Bank-assisted project. An assurance has been obtained that the Govern- ment would ensure that the survey and evaluation of the economic and social benefits of the project would be carried out by the survey and evaluation services included in the Sixth Irrigation Project. - 27 -

5. AGRICULTURALPRODUCTION

5.01 The project would increase agriculturalproduction by providing and improving irrigationand drainage on 18,100 ha of paddy land. Secondary crops would also benefit from the project. The changes are discussed under the respectiveproject areas.

Present Cropping Patterns

5.02 Cipamingkis. Rice is the most important crop in the Cipamingkis area. During the wet season, farmers grow irrigatedpaddy on 5,600 ha and rainfed paddy on 2,000 ha. During the dry season they irrigate about 1,000 ha of paddy, and grow around 2,000 ha of secondary crop (palawijacrop) Lion residual moisture. Red peppers are the main palawija crop, grown on 1,500 ha. The remaining 500 ha consists of a variety of crops such as soybean, corn, groundnut and sweet potato, and in this report soybean has been used to represent the group. The overall project area cropping intensity is about 139% per annum. Of the irrigatedpaddy area, about 500 ha is served by a semitechnicalsystem, while the balance is irrigatedby small, nontechnical (village)irrigation systems.

5.03 Wet season rice is grown between November and June. Depending on the start of irrigationsupplies, farmers transplantover some 12 weeks between November and early February. They harvest over ten weeks between March and May. Farmers grow dry season paddy between April and September, transplantingin April-Mayand harvesting in August-September. All rice is transplantedfrom field nurseries onto previouslypuddled land. Palawija crops are grown between March and October on dry season rainfall and residual subsoil moisture from the preceding crop. While some small plots may be hand irrigated,practically all palawija crops suffer moisture stress.

5.04 Farmers sow 40% HYV rice in the wet season and 70% in the dry season. HYV are mainly Pelita 1/2 and some IR 20 and IR 26. Averagewet season rainfed paddy yields are 1.8 ton/ha, irrigated paddy 2.6 ton/ha,and dry season irrigated paddy 1.7 ton/ha. Paddy yields are affected by poor water management,inadequate dry-season water supplies and insufficientagricul- tural input services. Average red pepper yields are 1.2 ton/ha and soybean 0.4 ton/ha. Insufficientwater principallycauses the low yields.

5.05 Jragung. The Jragung project area is split between 7,600 ha the reservoirwould directly irrigate during the dry season; 1,100 ha, adjacent to the 7,600 ha, which return flows would irrigate;and 1,800 ha of rainfed land alongside the river banks which the reservoirwould protect from wet season flooding. During the wet season, farmers plant the entire 10,500 ha to rice, of which 6,100 ha is rainfed and 4,400 ha is irrigated. No irrigation water supplies are availableduring the dry season, and farmers grow about 4,500 ha of palawija crop on residual subsoil moisture. Tobacco, with

/1 Palawija crops are those other than rice, sugarcaneand estate crops; major ones are soybeans,corn, cassava, groundnuts,sweet potato, green beans and vegetables. - 28 -

2,500 ha planted, is the main palawija crop. The other 2,000 ha consists of corn, sorghum, soybean, groundnuts and other crops, and, for this report, corn has been used to represent them. Annual cropping intensities vary from 100% on the 1,800 ha rainfed area to 152% on the balance of the project area. The overall project area cropping intensity is 143%.

5.06 Wet season rice is grown from October to May and dry season from March to August. Because of flooding during December to February, farmers who occupy the 1,800 ha rainfed area may have to replant considerable portions of their wet season crop. Farmers on the remainder of the project area may also be flooded; however, works under Loan 1435-IND would alleviate this. All rice is transplanted from field nurseries onto previously puddled land.

5.07 Farmers plant only local varieties on the 1,800 ha that are subject to floods. On the remaining 8,700 ha they plant 40% HYV in the wet season and 50% HYV in the dry season. Average wet season rainfed paddy yields are 1.4 ton/ha on the 1,800 ha; and on the remaining area it averages 1.6 ton/ha while irrigated paddy averages 2.8 ton/ha. Average dry season tobacco yields are 0.2 ton/ha (cut and dried leaf), and corn 0.8 ton/ha (dry kernel).

Future Cropping Patterns

5.08 Cipamingkis. Without the project cropping patterns would change little. Varietal improvement and slightly better farming practices would increase paddy yields about 10% by 1987 so that wet season rainfed paddy would average 2.0 ton/ha; irrigated paddy 2.9 ton/ha; and dry season irrigated paddy 1.8 ton/ha. As palawija crops are grown in the dry season on residual moisture, their yields are not expected to increase.

5.09 Table 5.1 shows the expected changes in cropping patterns and pro- duction with the project. During the wet season the entire 7,600 ha would be irrigated paddy. The dry season irrigated paddy crop would increase from 1,000 to 2,000 ha, and the area of palawija crop from 2,000 ha to 3,000 ha, giving an overall annual cropping intensity of 166%.

5.10 Jragung. Under Loan 1435-IND, PROSIDA is currently rehabilitating and constructing the irrigation systems on the 7,600 ha served by the Jragung main canal and the 1,100 ha return flow area. Consequently, even without the project this area would be fully and efficiently irrigated during the wet season. Although no dry season irrigation supplies would be available, because of the larger wet season area irrigated, farmers would increase their area of palawija crop grown from 4,500 ha to 6,000 ha. Wet season irrigated paddy would average 4.0 ton/ha; dry season tobacco 0.25 ton/ha and corn 0.9 ton/ha. However, on the 1,800 ha currently flooded and growing rainfed paddy, no change is expected in the cropping pattern or yields without the project. The overall, annual project area cropping intensity would increase to 157%.

5.11 Table 5.1 shows the expected changes in cropping patterns and production with the project. Although obtaining higher yields, farmers would continue to grow rainfed rice on the 1,800 ha given flood protection. Dry-season irrigation water from the Jragung reservoir would allow farmers to - 29 -

irrigate a dry season paddy crop on the 8,700 ha service and return flow areas. Assuming that management problems may restrict the dry season crop to 95% of the area (8,300 ha), the annual cropping intensity for the 8,700 ha would be 195%, and for the overall project area 179%.

Future Yields With Project

5.12 With good water management, control and distribution,a strengthened and improved extension service, and adequate credit and input supplies, the estimated average future crop yields at full project developmentwould be as follows:

ESTIMATED FUTURE YIELDS WITH PROJECT

Wet season Dry season Rainfed Irrigated Irrigated Red paddy paddy paddy pepper Soybean ------(ton/ha) ------

Cipamingkis - 4.2 4.2 1.8 0.6

Jragung 1.9 4.0 4.3 - -

The projected yields would be achieved five years after the introductionof water or completion of construction, rehabilitationor drainage works. The improved yields would be contingent upon the use of HYV rice varieties, cer- tified seed, and heavier fertilizer and crop protection input in the project areas. The introductionof the National Food Crops Extension Project to the project areas would play a key role in the organizationof farmer groups for extension, crop production, and water management. The forming of the groups would help in synchronizingcropping patterns and calendarswith projected water deliveries, increasing contact between individual farmers and govern- ment programs, and ensuring better use of resources and inputs available to each farmer.

5.13 Present and future crop areas, yields and total production for each project area are shown in Table 5.1. At full project development,about six years after completion of project works, annual total paddy production would reach 114,200 tons compared to 41,700 tons at present.

Cropping Calendars

5.14 Figures 5.1 and 5.2 show the proposed cropping calendars for paddy and secondary crops in the project areas. With the improvementand extension of irrigation and drainage facilities,paddy and other crops can be planted at the correct time, avoiding yield reductions due to planting out of phase and interferencewith the following crop. Apart from climate, the proposed cropping calendarshave also taken into account the peak labor demands for each of the field operations. - 30 -

Drying, Storage and Processing

5.15 Farmers sun-dry paddy on the roadside and in house yards and store it in their houses. Insufficientconcrete drying floors makes drying of the wet-season crop difficult and losses from rainfall can be considerable. The DGC is helping to overcome this problem by providing loans to BUUD/KUDs to install drying floors (para. 4.13). The project areas have more than sufficient milling capacity to handle current production. Besides numerous private mills, farmer cooperatives (BUUD/KUDs)own three in Cipamingkisand six in Jragung. Future increases in demand for milling capacity can be readily met, either by private capital or the BUUD/KUDs. Most rice milled is medium grade, around 35% broken. - 31 -

Table 5.1: CROPPING PATTERNS AND PRODUCTION

Present _ Future without project At full project development /a Area Yield Production Area Yield Production Area Yield Production (ha) (ton/ha) ('000 ton) (ha) (ton/ha) ('000 ton) (ha) (ton/ha) ('000 ton)

------Cipamingkis ------

Wet season Rainfed rice 2,000 1.8 3.6 2,000 2.0 4.0 - - - Irrigated rice 5,600 2.6 14.7 5,600 2.9 16.2 7,600 4.2 31.9

Subtotal 7,600 7,600 7,600

Dry season Irrigated rice 1,000 1.7 1.7 1,000 1.8 1.8 2,000 4.2 8.4 Red pepper 1,500 1.2 1.8 1,500 1.2 1.8 2,000 1.8 3.6 Soybean /b 500 0.4 0.2 500 0.4 0.2 1,000 0.6 0.6

Subtotal 3.000 3,000 5,000

Annual summary Paddy 8,600 - 20.0 8,600 - 22.0 9,600 - 40.3 Red pepper 1,500 - 1.8 1,500 - 1.8 2,000 - 3.6 Soybean 500 - 0.2 500 - 0.2 1,000 - 0.6

Total cropped area 10,600 10,600 12,600 Cropping intensity (%) 139 139 166

------Jragung ------…

Wet season Rainfed rice I /c 1,800 1.4 2.5 1,800 1.4 2.5 1,800 1.9 3.4 Rainfed rice II 4,300 1.6 6.9 ------Irrigated rice 4,400 2.8 12.3 8,700 4.0 34.8 8,700 4.0 34.8

Subtotal 10.500 10,500 10,500

Dry season Irrigated rice ------8,300 4.3 35.7 Tobacco 2,500 0.2 0.5 2,500 0.25 0.6 - - - Corn /d 2,000 0.8 1.6 3,500 0.9 3.2 - - -

Subtotal 4,500 6.000 8,300

Annual summary Paddy 10,500 - 21.7 10,500 - 37.3 18,800 - 73.9 Tobacco 2,500 - 0.5 2,500 - 0.6 - - - Corn 2,000 - 1.6 3,500 - 3.2 - - -

Total cropped area 15,000 16,500 18,800 Cropping intensity (x) 143 157 179

/a In 1987 for Cipamingkis and 1988 for Jragung.

/b Represents a group of palawija crops, including soybean, corn, groundnut, sweet potato, other vegetables.

/c Rainfed rice I area presently flooded alongside Jragung river. Rainfed rice II - area within 7,600 ha served by the Jragung main canal.

/d Represents a group of palawija crops, including corn, sorghum, soybean, groundnut, vegetables. - 32 -

6. MARKET PROSPECTS, PRICES, FARM INCOMES AND PROJECT CHARGES

Market Prospects

6.01 Self-sufficiency in rice is a major Government goal. Indonesian rice production has been unable to satisfy demand for many decades. From 1969 to 1976, imports have ranged between 0.5 and 1.3 million tons. However, due to a poor domestic crop in 1977,/l recent dry weather, and a steadily increasing population, imports have risen dramatically to around 2.5 million tons for Indonesian FY77/78. While rice production grew by some 4.5% from 1969 to 1975 (from 11.7 to 15.5 million tons), production has stagnated around 15.5 million tons for the last three years. Although the Government's estimates of future demands suggest 0.6 million tons of rice imports would be required in 1978, it now appears this figure would be considerably higher, and substantial imports would continue to be required for many years. Thus no difficulties are foreseen in marketing the additional 72,500 tons of paddy from the project areas.

6.02 Much of the incremental rice production from Cipamingkis and Jragung would be consumed at the farm level, while the surplus to local requirements would be marketed in the Jakarta and Semarang urban areas respectively. Palawija crop production would be marketed locally.

6.03 Farmers mainly sell their surplus paddy production through private dealers and millers. The Government's rice procurement authority (BULOG/ DOLOG) maintains a floor price for paddy in the project areas, and the BUUD/KUD, its purchasing agent in the villages, buys a standard grade of paddy directly from farmers at a fixed price. The floor price is currently Rp 70 (US$0.17)/kg for 14% moist paddy at the village. Although during nonharvest periods, prices on the open market are usually higher than the floor price, farmers are often forced to sell their paddy below the floor price during the wet-season harvest. In some cases inadequate facilities prevent paddy from being dried to the required 14% moisture content standard. In other cases, BUUD/KUDs exhaust their credit lines from BULOG and are unable to obtain cash to pay the farmers, who need cash immediately to meet tax payments or to pay off the last season's debts so that they can purchase inputs for the new season, and are then forced to sell their paddy on the open market at a discount. Most farmers sell paddy with about 18-20% mois- ture content and up to 10% impurities. Practically all farmers have to sell some paddy immediately after harvest to meet their debts, even if later they have to repurchase paddy for consumption. BULOG, through its subsi- diary DOLOG, also maintains rice and paddy storages at the provincial level. Farmers sell their palawija crop production in village and subdistrict markets. Facilities at these markets are being upgraded where necessary under the INPRES program. Some BUUD/KUDs are disseminating information on market prices to their members.

/1 Dry-season harvest 1976, wet-season harvest 1976/77. - 33 -

Prices

6.04 For both the farm budget and economicanalysis, farm inputs and outputs have been valued in mid-1978 prices. For rice, soybean,corn and fertilizers,these prices were derived from the Bank's CommodityDivision's forecastsfor world market prices,and adjustedfor transportationcosts. The remainingcrops and inputs not traded on the internationalmarket have been expressedin terL. of actual farmgateprices averagedover three years (1975-77)and adjusted for inflation.Only an estimated10% of rice production from the project areas would be milled into high-graderice (5% brokens);60% would be medium-grade(25-35% brokens); and 30% would be low grade (42% brokens). Using this qualitymix and the world market price forecasts,the equivalenteconomic farm-gateprice for paddy would rise from US$146/tonin 1978 to US$187/ton in 1985 (in terms of mid-1978 constantdollars) in the project areas. Historically,the Governmenthas followeda policy of keeping consumer food prices low by selling importedrice below its cost and keeping domestic floor prices low. To mitigate the effect of this policy on farm income, GOI has simultaneouslysubsidized fertilizer and pesticide. In the last two years, however, GOI has substantiallyraised domesticpaddy prices to encouragerice production. This change in policy, combinedwith the fall of world prices from the record levels of 1973-74,has brought farm-gate prices fairly close to world market levels. Thus, the floor price for paddy is now Rp 70/kg, as comparedwith an imputed economicprice of Rp 76/kg. Althoughwith some fluctuations,GOI has similarlygradually reduced the subsidiesfor fertilizers. GOI is expected to continue its efforts to align domesticand world market prices, and consequentlyat full development, economic and financialprices for inputs and outputs are assumed to coincide at the Bank's forecastedworld market prices.

6.05 Price structuresfor food crops and fertilizersare shown in Table 6.1. Table 6.2 shows all prices used for the financialand economic analyses.

Farm Incomes

6.06 For farm income analysis,farm models have been prepared for three typicalfarm sizes (0.2, 0.5 and 1.2 ha) at Cipamingkis,and one farm size (0.5 ha) at Jragung. Details are presentedin Table 6.3. Although benefits would not be generatedat Jragung until constructionof the dam, a farm model has been constructedto show the expected benefits for the averagesize farm. Land use and croppingpatterns for the presentconditions broadly reflect averages for cultivatedlands in the project areas. For the analyses, soybean representsa compositegrouping of secondary(palawija) crops such as soybean, groundnut,corn, green beans and sorghum at Cipamingkis,while corn representsthe areas of a similar grouping of crops at Jragung. Farm budgets are calculatedaccording to cash flows. Labor costs includeonly hired and harvest labor, not farm family labor, and were determinedfor non-harvestperiods by calculatingthe excess of total monthly labor require- ments over an estimated40 man-days of family labor per farm per month. Hired farm labor is costed at Rp 350/day at Cipamingkisand Rp 300/dayat Jragung. Average annual land taxes (IPEDA)at present are Rp 7,000/haat - 34 -

Cipamingkisand Rp 4,000 at Jragung. Without the project they would remain at the same level at Cipamingkis,but because of ongoingwork at Jragung under Loan 1435-IND they are expected to reach about Rp 10,000/ha. At full development they would reach an estimatedRp 13,000/haat Cipamingkisand Rp 14,000/ha at Jragung. With the project, farmerswould also contribute Rp 4,000/ha (some 50 kg of paddy/ha) for O&M of the tertiaryand quaternary irrigation units. Sharecroppingis extensive in both subprojects,and farm incomes have been calculated for both owner-operatorsand sharecroppers. Except for the landlord paying the land tax, and the sharecropperand his family providing the labor, the landlord and sharecropperequally divide gross production less harvesting and other productioncosts. Farm families in all areas also earn considerableoff-farm income from either skilled (carpentry, stone masonry, local public official)or unskilledwork, and from roadside trading. Based on farmer interviewsin the project areas, off-farm family earnings have been estimated for the present and for the future with the project.

6.07 At Cipamingkis,the smallest farm (0.2 ha) is assumed already entirely irrigatedduring the wet season and 20% of its area irrigatedin the dry season. The two larger farms are about 65% irrigatedin the wet season, but receive no irrigationwater in the dry season. Annual cropping intensities,which increase with the project, are highest on the 0.2 ha farm, and progressivelyfall for the other two farms. At Jragung the model farm is assumed half irrigatedand half rainfed at present, but due to works under Loan 1435-IND,becomes fully irrigatedduring the wet season in the without project situation.The proposed project would supply dry season water, thus considerablyincreasing the annual cropping intensity.

6.08 Table 6.3 shows the results of the farm budget analysis. Between now and full agriculturaldevelopment of the project, net crop incomeswould grow at 10-12%/yearat Cipamingkis and 5-6%/year at Jragung. Even allowing for the additionalcosts of family farm labor and management (Table 6.4), this indicates farmerswould have sufficient financial incentiveto achieve the projected yields and cropping intensities.

6.09 Although comparisonsof farm incomesbased on farm budgets with income data based on national accounts aggregatesmust be interpretedwith caution, they do present an approximationof the relative position of project beneficiaries. Present per capita farm incomes in the project areas are between US$35 and US$85, about 15-30% of the estimated 1978 per capita GNP of US$275. Thus an estimated90-95% of these families presentlyhave annual per capita incomes at or below the estimated absolute poverty level of US$95 (1975 prices). Providing the farm population remains constant, at full project development in 1987 the projectedper capita farm income is estimated to range from US$55 to US$175, some 15-45% of the then per capita GNP. The project would enable beneficiariesto slightly improve their income levels throughout the economy. It would also raise some 30-35% of the farmers above the absolute poverty level. - 35 -

6.10 No reliable income data are available for the landless laborers who live in the project areas. However, assuming two full-time workers per family; an average wage rate of Rp 200/day; and 200 work days/year/worker, the annual income of a landless family can be no more than Rp 80,000 or US$195. bince employment opportunitiesare limited, many families probably earn less. Benefits to accrue to landless laborers under the project are discussed in para. 7.01.

Project Charges

6.11 Irrigators in Indonesia pay a land tax (IPEDA) and, depending on the intensity of on-farm irrigation development,water charges for the operation and maintenance of the irrigation system below the secondary turn-out. IPEDA is collected by village heads, and turned over to local and provincial adminis- trations for use in public services. However, it can be considereda direct project tax which contributes towards the operation and maintenance,plus capital repayments,of the main irrigation system. Since IPEDA is assessed as a percentage of the value of production, the amounts collected would increase as crop yields rise in response to the project. A GOI interministerial committee has recommended that part of this increase in IPEDA should be used to cover annual operating and maintenance costs of the irrigationworks that were rehabilitatedor constructed. Additionally,as a result of a recent GOI decision to tie disbursementsunder its local infrastructuredevelopment program (INPRES) to IPEDA collection performance,IPEDA collection rates have improved markedly. At present up to 10% of the IPEDA collection is used for O&M of the main and secondary systems. The Central Government,however, provides the balance of funds, 90% or more, required for O&M of the main systems.

6.12 Water-user associationsat the tertiary canal level in Indonesia have traditionallycontributed a portion of their crop to the water master (ulu-ulu),or he has received the use of an area of village rice land, in payment for his services. As tertiary and quaternary canal and drain develop- ment has occurred under Bank-assistedirrigation projects, the irrigators have increased their contributionsto cover all operation and maintenance costs of the teriary/quaternaryunit. The amount of this water charge varies according to the degree of developmentof the tertiary unit. Present and expected future levels of IPEDA and water charges are as follows in the two subproject areas (in constant mid-1978 prices): - 36 -

PROJECT CHARGES AVERAGED OVER SUBPROJECT AREAS

Present /a With project /b Increment -…------(Rp/ha)/c ------

Cipamingkis

IPEDA 7,000 13,000 6,000 Water charges 500 4,000 3,500

Total 7,500 17,000 9,500

Jragung

IPEDA 10,000 14,000 4,000 Water charges 3,000 4,000 1,000

Total 13,000 18,000 5,000

/a At Jragung these are the estimated IPEDA and water charges after full development of Loan 1435-IND project works. At Cipamingkis, present and future "without project" charges would remain the same.

/b With project refers to full agricultural development in 1986 at Cipamingkis, 1987 at Jragung.

Ic In terms of constant mid-1978 rupiahs.

6.13 Assurances have been obtained that, following completion of the Cipamingkis subproject, GOI would collect, in accordance with its laws and regulations, the adjusted IPEDA based on the increased productivity of all irrigated land rehabilitated and constructed under the project; amounts to be collected would be sufficient to ensure sound O&M practices and to recover a reasonable portion of the capital costs during the project's useful life, taking into account farmers' incentives and capability to pay; and it would submit to the Bank for review every two years the IPEDA rates collected for different land classes.

6.14 In determining the extent of cost recovery and the relation of project charges to benefits under the project, cost and rent recovery indices have been calculated. The cost recovery indices are 7% for Cipamingkis and 53% for Jragung. Rent recovery indices were calculated for owner-operators and share croppers on 0.2, 0.5 and 1.2 ha farms at Cipamingkis, and on a 0.5 ha farm at Jragung. They indicate that at Cipamingkis owner-operators would pay from 27% to 84% of their project rent in incremental project charges, and share croppers from 9% to 31%; while at Jragung owner-operators on the average size farm would pay 27% and share croppers 2%. Table 6.4 lists the assumptions used in calculating the rent recovery indices. - 37 -

6.15 Project charges are considered satisfactoryin both the subproject areas. Even though most owner-operatorswould have rent recovery indices less than 50%, no increase is proposed in the projected land tax rate and water charges farmers would pay under the project as some 90% of the project area farmers would have per capita incomes below the critical consumption level /1 at full project development. All farmers pay heavy local taxes. Besides paying substantial total direct project charges (land taxes and tertiary/ quaternary block O&M charges of Rp 17,000-18,000/ha),they would pay at least 10% of their gross value of production in village taxes, as well as contributingto the social life of the village through religious taxes, compulsory feasts, and allowing all village members, if they wish, to partake in the harvest of the farmer's paddy crop. The harvesters retain up to one fifth of the crop as payment, a wage rate considerablyhigher than the average market rate. Since even at full project developmentpractically all share cropper families would have per capita incomes below the critical con- sumption level, the low rent recovery indices for this group are appropriate.

/1 Critical consumption level (CCL) is defined as the consumption level at which the social value of an extra unit of consumption equals the social value of an extra unit of public revenue. In Indonesia the CCL is estimated to be at least two thirds of national GNP per capita. - 38 -

Table 6.1: PRICE STRUCTURE FOR FOOD CROPS AND FERTILIZERS

Food crop & 1 9 7 8 1 9 8 5 fertilizer prices '000 Rp/ton US$/ton '000 Rp/ton US$/ton

Rice Export price, Thai 5-42% broken mix, /a f.o.b. Bangkok 122.3 235 156.0 300 Ocean freight & insurance 10.4 20 10.4 20 Port handling, storage, transport to wholesaler 4.2 8 4.2 8 Handling, transport mill to wholesaler -2.6 -5 -2.6 -5 Rice price, ex-mill, project area 134.3 258 168.0 323 Paddy equivalent price (63% recovery) 84.5 163 105.5 203 Milling costs less value of by-product -2.0 -4 -1.0 -2 Drying & cleaning -1.5 -3 -1.5 -3 Handling, transport farm to mill -1.0 -2 -1.0 -2 Farm-gate paddy price /b 80.0 154 102.0 196 (Financial farm-gate price) /c (65.0)/d (157) (81.0) (196)/e

Soybean Export price, f.o.b. US Gulf port 143.0 275 180.4 347 Ocean freight & insurance 15.6 30 15.9 30 Port handling at Semarang 3.6 7 3.7 7 Soybean price on trucks, Semarang 162.2 312 200.0 384 Transport wholesalers to wharf -4.2 -8 -4.0 -8 Transport farm to wholesaler -3.0 -6 -3.0 -6 Farm-gate price /b 155.0 298 193.0 371 (Financial farm-gate price) /c (130.0) (313) (154.0) (371)/e

Corn Export price, f.o.b. US Gulf port 44.7 86 62.0 119 Ocean freight & insurance 8.3 16 8.3 16 Port handling at Semarang 3.1 6 3.1 6 Corn price on trucks, Semarang 56.1 108 73.4 141 Transport wholesalers to wharf -3.9 -7 -3.4 -7 Transport farm to wholesaler -2.2 -4 -2.0 -4 Farm-gate price /b 50.0 96 68.0 131 (Financial farm-gate price) /c (40.0) (96) (54.0) (131)/e

Urea World export price, f.o.b. /f 85.8 165 114.4 220 Ocean freight & insurance 3.1 6 3.2 6 Handling, distribution to retail level 21.0 40 21.4 41 Transport BUUD/KUD kiosk to farm 1.1 2 1.0 2 Farm-gate price /b 111.0 213 140.0 269 (Financial farm-gate price) /c (71.0) (171) (112.0) (269)/e

TSP World export price, f.o.b. Florida 61.4 118 90.0 173 Ocean freight & insurance 11.4 22 11.2 22 Handling, distribution to retail level 21.1 41 20.8 40 Transport BUUD/KUD kiosk to farm 1.1 2 1.0 2 Farm-gate price /b 95.0 183 123.0 237 (Financial farm-gate price) /c (71.0) (171) (98.0) (237)/e

/a Assumed rice quality: 10% of production, 5% brokens; 60% medium grade, 25-35% brokens; 30% lower grade, 42% brokens. Assumed prices in 1985 (in constant mid-1978 prices); 5% brokens, US$422/ton; 25-35 brokens, US$290/ton; 42% brokens, US$275/ton.

/b At a shadow-priced exchange rate of Rp 520 = US$1.00.

/c At the official exchange rate of Rp 415 = US$1.00.

/d Present financial price calculated as follows: floor price at BUUD/KUD for 14% moisture content paddy Rp 70/kg; less Rp 1.5/kg drying and cleaning; Rp 1/kg transport farm to BUUD/KUD; Rp 2.5/kg for market imperfections.

/e In the future, distortions are assumed eliminated between internal and world market prices.

/f Urea is valued at ex-PUSRI factory, Palembang, IBRD world market price projections for bagged urea f.o.b. Europe have been adjusted for South-East Asia markets. - 39 -

Table 6.2: INPUT AND OUTPUT PRICE SUMMARY (Rp'000/ton)

1 9 7 8 1 9 8 5 Financial Economic Financial Economic

Crops Rice 65.0 80.0 81.0 102.0 Soybean 130.0 155.0 154.0 193.0 Corn 40.0 50.0 54.0 68.0 Red pepper 300.0 300.0 300.0 300.0 Tobacco 800.0 800.0 800.0 800.0

Fertilizer Urea 71.0 111.0 112.0 140.0 TSP 71.0 95.0 98.0 123.0

Seeds Rice - local 65.0 80.0 81.0 102.0 HYV 150.0 160.0 160.0 200.0 R.edpepper 300.0 300.0 300.0 300.0 Tobacco 216.0 216.0 216.0 216.0 Soybeans 130.0 155.0 170.0 220.0 Corn 40.0 50.0 54.0 68.0

Other Zinc phosphide 2,300.0 2,700.0 2,300.0 2,700.0 Agrochemicals /a 900.0 4,100.0 900.0 4,100.0

/a Rp/liter. Table 6.3: SUMMARY OF FARM BUDGETS

Family Crop income Off-Farm income Total farm income /a Per capita income Farm size size Present Future /b Present Future Present Future Present Future (ha) (no.) ------…-_-__--_-_-_-____--(Rp'000) ---- …-___U_------(US$)…

Cipamingkis

0.2 5.5/c 35 95 70 70 105 165 45 70 5.5 15 50 70 70 85 120 35 55

0.5 5.5 95 235 60 50 155 285 70 125 5.5 50 120 60 50 110 170 50 75

1.2 5.5 155 380 40 20 195 400 85 175 5.5 80 190 40 20 120 210 55 90

Jragung

0.5 5.5 130/d 220 50 40 180 260 80 115 5.5 65/d 115 50 40 115 155 50 70

/a All income data is rounded to nearest Rp 5,000 and US$5.00.

/b Future represents at full project development in 1987 for Cipamingkis, and 1988 for Jragung.

/c For each farm size the top data line refers to owner-operators, and the second to share-croppers.

/d This figure refers to future without project, as due to an earlier Bank project (Loan 1435-IND), present income would increase substantially. Table 6.4: RENT RECOVERY (Rp'000)

C I P A M I N G K I S J R A G U N G 0.2 ha farm 0.5 ha farm 1.2 ha farm 0.5 ha farm Owner-op. Share-crop. Owner-op. Share-crop. Owner-op. Share-crop. Owner-op. Share-crop.

A. At Full Project Development

1. Incremental gross value of farm production /a 66 33 152 76 259 130 127 64 2. - Less cash production costs /a 13 7 31 16 74 44 36 18 3. - Equals net cash income 53 26 121 60 185 86 91 46 4. - Less imputed family labor costs /b 6 6 16 16 25 25 6 6 5. - Less imputed farmer's management /c 3 2 8 4 13 7 6 3 6. - Less imputed return on own capital /d 13 - 26 - 42 - 25 7. - Less allowance for risk/uncertainty /e 13 7 30 15 52 26 25 13 8. - Less general taxes /f 7 3 15 8 26 13 13 6 9. - Less miscellaneous TR 3 2 8 4 13 7 6 3 10. Equals project rent 8 6 18 13 14 8 10 15

11. Incremental - Water charges (O&M) 1 0.5 2 1 4 2 0.5 0.25 12. - Land tax (IPEDA) I - 3 - 7 - 2

13. - Total direct charges 2 0.5 5 1 11 2 2.5 0.25 4

B. Discounted Cash Flows Over Project Life /h

14. Project rent 62 1.7 140 101 109 62 78 117 15. Water charges 9 5 19 9 38 19 5 2 16. Land taxes 8 - 23 - 54 - 16

17. Total direct charges 17 5 42 9 92 19 21 2 18. Rent recovery (%) 27 11 30 9 84 31 27 2

Farm income per capita at full development (1987)(US$) 70 55 125 75 175 90 115 70 Absolute poverty (1975): US$95 GNP per capita (1978): US$275/i

/a From Annex 2, Table 5. /b Wage rate Rp 350/day at Cipamingkis; Rp 300/day at Jragung. /c At 5% of incremental gross value of farm production. /d At 10% of farmer's own incremental capital. /e At 20% of incremental gross value of farm production. /f Village taxes, at 10% of incremental gross value of farm production. /g Storage losses, at 5% of incremental gross value of farm production. /h Net present value of project rent and incremental charges, which are discounted at 10% per year over the project life (30 years). /i GNP per capita for 1977 of US$260 inflated by 6%. - 42 -

7. BENEFITS, JUSTIFICATIONAND RISKS

7.01 By providing improved water control, distributionand drainage, the proposed project would increase crop yields and production on 7,600 ha at Cipamingkis. The project would directly benefit some 16,000 farm families or some 88,000 people; and by providing additional employment opportunities, indirectly benefit some 2,800 landless laborers' families, or 63,000 people. By increasing crop production and the dry-season cropped area it would create a demand for an additional 0.6 million man-days of farm labor per year, equiv- alent to some 2,500 full-time jobs annually. Constructionof the second stage of the Jragung Dam would provide 63 MCM municipal and industrial water supply for the city of Semarang and 30 GWh of hydroelectricpower generation. It would also increase crop yields on 10,500 ha and directly benefit 20,200 farm families or some 112,000 people; and by providing additional employment opportunitiesof 0.9 million man-days of farm labor per year, indirectly benefit 8,600 landless laborer families, or 48,600 people. The reservoir would also reduce the rivers silt load by some 540,000 cu m annually, thus reducing O&M costs in the irrigation area served by the Jragung main canal, and the dredging of floodways at the river's mouth. Although not included in the economic benefits, the project would considerablyimprove village water supplies for domestic purposes throughout the project areas. It would also support the Government'spolicies of reducing food grain imports and attain- ing self-sufficiencyin rice production.

7.02 Economic rates of return are presented for the proposed works at Cipamingkis,and for the completed reservoir at Jragung, including the hydropower generating facilities and urban water supply offtake, treatment and distributionworks. Although the project provides only for the construc- tion of the access road and diversion tunnel at Jragung, the economic rate of return has been calculated for the entire subproject to demonstrateits economic feasibility. The proposed phasing of project works at Jragung results from financial considerations,not from any logical physical separation of project works into various stages.

7.03 Benefits. Expected future crop yields and production with and without the project are discussed in Chapter 5. Chapter 6 presents the farm- gate prices for inputs and outputs, based on the Bank's commodityprice fore- casts for rice, soybean and chemical fertilizers,and domestic prices for other commodities. Annex 2, Table 3 gives the expected crop production costs and labor requirement/ha;Table 7.1 shows the expected gross and net crop returns/ha (without accounting for labor), the total expected agricultural benefits at full agriculturaldevelopment for the project areas, and sum- marizes net agriculturalbenefits for each project area.

7.04 The hydropower installationat Jragung would assist Perusahaan Umum Listrik Negara (PLN), the national power company of Indonesia,meet the existing demands of consumers in the city of Semerang,who at present exper- ience frequent power black-outs and brown-outs during the year. The avail- able supply of energy is already considerablyless than the present demand, the annual amount of power produced at Jragung is small compared to the total annual demand in Central Java, and because the existing system has sufficient capacity to handle the Jragung output, no investmenthas been allowed for - 43 -

additional distribution facilities at the retail consumer level. The energy has been valued at the estimated average consumer tariff of Rp 34.9/kWh /1 for 1978, less 10% transmission and 10% distribution losses, and the O&M costs of generation, transmission and distribution. Transmission O&M has been estimated at 1% of the capital cost of transmission, while the distri- bution O&M has been estimated at Rp 0.5/kWh supplied to retail consumers.

7.05 Following feasibility studies of the alternative sources of munici- pal and industrial water supply for Semerang, GOI has given priority to Jragung reservoir (together with the development of the Muncul Springs and groundwater sources) to meet increased demand up to around 1990. The reservoir would supply an additional 63 MCM of water annually, and this has been valued at Rp 91/cu m supplied to retail consumers. Although this is above the existing tariff (Rp 43 cu/m), it corresponds to the tariff levels suggested for new urban water supplies in the appraisal of the proposed Second Water Supply Project. Health benefits, which would be extensive, have not been quantified.

7.06 The reservoir would reduce silt deposition by an estimated 135,000 cu m per year in the floodways where the river enters the sea. Average dredging costs are Rp 700/cu m, and benefits from reduced dredging are estimated at Rp 94.5 million annually. Other benefits from reduced siltation are expressed in lower O&M costs for the Jragung main canal service area.

7.07 Foreign Exchange. Due to the existence of import taxes, quanti- tative restrictions and export subsidies, the official exchange rate of Rp 415 = US$1.00 does not represent the true value to the economy of foreign exchange used in carrying out the project, and savings through increased grain production. A standard conversion factor of 0.8 (Rp 520 = US$1.00) was, therefore, used in the economic analysis.

7.08 Labor Pricing. Because of the small average farm size (0.5 ha in both project areas), and the large number of landless families whose major income source is farm labor, considerable unemployment, and low productivity employment, exists in the project areas. Additionally, farm labor require- ments are distinctly seasonal, with major demands occurring during the wet season. Even at full project development during the month of peak labor requirement (wet-season harvesting, dry-season cultivation and transplant- ing of rice), total labor utilization in agriculture would be only 43% at Cipamingkis and 55% at Jragung. While the farm labor force tries to offset this situation by doing considerable off-farm work, much of this is of extremely low productivity. Thus farm labor was valued at a monthly shadow wage rate. This varies seasonally, and based on experience in other compar- able Bank-assisted irrigation projects in Indonesia, averages Rp 130/man-day at Cipamingkis and Rp 140/man-day at Jragung over the year under "with

/1 Annex 8, Report No. 1638a-IND; Indonesia, Appraisal of the Seventh Power Project. - 44 -

project" conditions at full agriculturaldevelopment, compared to a full employmentmarket wage of Rp 350/man-day at Cipamingkisand Rp 300/man-dayat Jragung. Table 7.2 shows the total monthly labor requirementsfor crops by project areas. Since project constructionwork would employ many local landless laborers, and to reflect the low productivityof much of their existing work, unskilled labor used in civil works was valued at 50% of its estimated actual cost for the economic analysis.

7.09 Investment Costs. As calculated for the economic analyses and expressed in mid-1978 prices, the total investmentcosts are Rp 9.40 bil- lion /1 for Cipamingkisand RP 55.22 billion /2 for Jragung. Investment costs are net of taxes and transfer payments. In determining their rupiah value, foreign exchange costs were converted to rupiah using a standard conversion factor of 0.8 (para. 7.07). Investment costs have been adjusted to reflect the economic value of unskilled labor used in construction(civil works reduced 10%, para. 7.08). Costs include physical contingencies,but exclude price contingencies. Other investmentcosts included are the infra- structure required for agriculturalsupporting services, such as paddy drying floors, paddy and fertilizer storages at village level, BRI and BUUD/KUD buildings, and BUUD/KUD equipment. Estimated incrementalannual O&M costs would vary from minus Rp 900 to Rp 3,500/ha for the main irrigation systems and from Rp 1,000 to Rp 3,500/ha at the farm level. Estimated O&M of the power generation is Rp 32 million per year /3, and estimated O&M of the municipal and industrialwater supply is Rp 1.45 billion per year /4.

7.10 Development Period. According to the project implementation schedules (Figure 3.1), developmentwould occur as follows:

Cipamingkis. The diversion weir would be completed in April 1982, and the 1982 dry-season crop would be the first grown under upgraded conditions. All the service area would be completed and ready for the 1982/83 wet season.

Jragung. Water storage would commence during the 1983/84 wet season, and the 1984 dry season crop would be the first grown under upgraded conditions. Power generation and urban water

/1 Includes Rp 0.05 billion for required infrastructurefor agricultural supporting services.

/2 This includes constructionof the reservoir, the hydroelectricpower plant and transmissionlines (Rp 26.37 billion); the municipal and industrialwater offtake, treatment, transmissionand distributionworks (Rp 28.78 billion); and infrastructurefor agriculturalsupporting services (Rp 0.07 billion).

/3 This includes the hydroplant operation, and transmissionand distri- bution of the power.

/4 This includes water treatment costs; pumping from the treatment plant to Semarang; and water distributionoperations. - 45 -

supply would also commence in 1984, with 50% of annual total power and water supply benefits being realized that year. Benefit flows would reach 100% for power in 1985; and for water supply 67% in 1985, 83% in 1986, and 100% in 1987.

Beginning with the first crop grown under upgraded conditions, farmers would achieve the projected yield levels over five years in equal installments. Cipamingkiswould reach full development in 1987 and Jragung in 1988.

7.11 Salvage Values. At Jragung the economic life of several of the structureswould be considerablylonger than the period over which the economic analysis has been conducted (35 years). Thus salvage values equal to 67% of the original cost of the dam, and 33% of the water treatmentplant were added to the flow of economic benefits in year 35.

7.12 Economic Rate of Return. Using the foregoing assumptions and dis- counting project costs and benefits over 35 years the economic rates of return are 13% for Cipamingkis,and 12% for Jragung (Table 7.3). The weighted average "rate of return" for the entire project would be 12%.

7.13 SensitivityAnalysis. During implementationthe most likely problems the project would encounter are constructiondelays and cost overruns. Thus the sensitivityof the rates of return were tested to these variables, including three and five year delays in the commencementof Jragung dam construction,plus a 25% reduction in total benefits should farmers not realize the projected commodity prices, cropping yields and/or intensities. The following table shows the results of the analysis:

Parametervaried Cipamingkis Jragung …____ _ …(%) …______

Base estimate 13 12 Constructioncost increasedby 20% 11 9 Commencementof dam construction and benefit flow delayed: three years - 11 five years - 10 Total benefits decreased 25% 10 8 Total benefits increased 25% 16 16

Under all adverse conditions tested, the economic rates of return fall below 12%, which demonstratesthe need to keep costs and benefits at or near present projections,and to keep to the proposed constructionschedule. The benefits estimated to flow from the proposed works at Jragung are contingent upon the dam being constructed. However, in none of the cases tested would the rate of return fall below 8%, while on the other hand, if the level of benefits are 25% higher than forecasted,the rates of return would be around 25-33% higher. - 46 -

7.14 Risks. No major management or organizationalproblems are expected in the implementationof the project. Rapid inflation over the last several years led to sizeable cost overruns on projects initiated in the early 1970s. Inflation is now more nearly under control, but provisions for price increases are greater for this project and other projects recently financed by the Bank than in earlier projects. Table 7.1: ECONOMIC ANALYSIS - NET VALUE OF AGRICULTURAL PRODUCTION AT FULL PROJECT DEVELOPMENT /a

Production Farm-gate Gross value Production Net value of net value in Imputed Net benefit in Area Yield price of production costs production project area labor cost project area ('000 ha) (ton/ha) (Rp'000/ton) ------(Rp'000/ha) ------(Rp million) ------

CipamingP is

Future Without Prolect Wet season - Rainfed rice 2.0 2.0 102 204 46 158 316 - Irrigated rice 5.6 2.9 102 296 64 232 1,299

Dry season - Irrigated rice 1.0 1.8 102 184 51 133 133 - Red pepper 1.5 1.2 300 360 29 331 497 - Soybean 0.5 0.4 193 77 13 64 32

Total 2.277 241 2.036

Cropping intensity: 139

Future With Project Wet season - Irrigated rice 7.6 4.2 102 428 84 344 2,614

Dry season - Irrigated rice 2.0 4.2 102 428 79 349 698 - Red pepper 2.0 1.8 300 540 45 495 990 - Soybean 1.0 0.6 193 116 21 95 95

Total 4.397 327 4.070

Cropping intensity: 166 X- Incremental Benefits from Project Area 2.120 86 2,034

jragung

Future Without Prolect Wet season - Rainfed rice I /b 1.8 1.4 102 143 31 112 202 - Irrigated rice 8.7 4.0 102 408 79 329 2,862

Dry season - Tobacco 2.5 0.25 800 200 74 126 315 - Corn 3.5 0.9 68 61 25 36 126

Total 3505 432 3.073

Cropping intensity: 157

Future With Project Wet season - Rainfed rice I 1.8 1.9 102 194 42 152 274 - Irrigated rice 8.7 4.0 102 408 79 329 2,862

Dry season - Irrigated rice 8.3 4.3 102 439 80 359 2,980

Total 6.116 569 5,547

Cropping intensity: 179

Incremental Benefits from Project Area 2.611 137 2.474

/a Full agricultural development occurs in 1987 at Cipamingkis, and 1988 at Jragung.

Rainfed rice I refers to the area which the project protects from floods. - 48 -

Table 7.2: TOTAL MONTHLY CROP LABOR REQUIREMENTS ('000 man-days)

Area Jan Feb Mar Apr May Jun Jul Aug Sep Oct NOv Dec Total ('000 ha)

Cipamingkis

Wet Season Rainfed rice P 2.0 64 56 18 40 38 20 - - - - 40 64 340 W 2.0 64 56 18 40 38 20 - - - - 40 64 340

Irrigated rice P 5.6 196 185 73 157 106 56 - - - - 112 179 1,064 W 5.6 207 196 84 168 118 56 - - - - 112 179 1,120 W 7.6 266 274 266 266 205 - - - - - 152 243 1,672

Dry Season Irrigated rice P 1.0 - - - 20 43 42 20 30 25 - - - 180 P 1.0 - - - 20 45 45 22 33 25 - - - 190 W 2.0 - - 20 84 110 60 60 106 - - - - 440

Red pepper P 1.5 - - - - - 45 30 30 45 45 - - 195 W 1.5 - - - - - 45 30 30 45 45 - - 195 W 2.0 - - - - - 60 50 40 60 70 - - 280

Soybean P 0.5 - - - 5 12 9 7 11 11 - - - 55 W 0.5 - - - 5 12 9 7 11 11 - - - 55 W 1.0 - - 10 25 21 16 25 23 - - - - 120

Total P 10.6 260 241 91 222 199 172 57 71 81 45 152 243 1,834 W 271 252 102 233 213 175 59 74 81 45 152 243 1,900 W 266 274 296 375 336 136 135 169 60 70 152 243 2,512

Jragung

Wet Season Rainfed rice I P 1.8 68 59 22 36 34 18 - - - - 40 65 342 W 1.8 68 59 22 36 34 18 - - - - 40 65 342 w 1.8 54 47 21 36 40 21 - - - - 40 65 324

Rainfed rice II P 4.3 129 103 39 86 82 43 - - - - 94 155 731

Irrigated rice P 4.4 145 132 57 119 84 44 - - - - 97 158 836 w 8.7 287 278 305 305 235 - - - - - 191 313 1,914 W 8.7 287 278 305 305 235 - - - - - 191 313 1,914

Dry Season Irrigated rice W 8.3 - - 83 349 456 249 249 440 - - - - 1,826

Tobacco P 2.5 - - - - 125 110 45 83 125 137 - - 625 W 2.5 - - - - 125 110 45 83 125 137 - - 625

Corn P 2.0 - - - 20 38 18 32 32 - - - - 140 W 3.5 - - - 35 66 32 56 56 - - - - 245

Total P 15.0 342 294 118 261 363 233 77 115 125 137 231 378 2,674 W 16.5 355 337 327 376 460 160 101 139 125 137 231 378 3,126 W 18.8 341 325 409 690 731 270 249 440 - - 231 378 4,064 Table 7.3: ECONOMICCOSTS AND BENEFITS (Rp billion)

_ Capitalcost _ O&M costs Total Incremental prolect benefits Year Dam Water supply Irrigation Power Water supply annual cost Irrigation Power Water supply Dredging Total

Jragung 1 (1978) 0.48 0 0 0 0 0.48 0 0 0 0 0 2 (1979) 1.01 0 0 0 0 1.01 0 0 0 0 0 3 (1980) 1.09 0 0 0 0 1.09 0 0 0 0 0 4 (1981) 2.86 4.02 0 0 0 6.88 0 0 0 0 0 5 (1982) 4.69 7.59 0 0 0 12.28 0 0 0 0 0 6 (1983) 7.14 8.14 0 0 0 15.28 0.01 0 0 0 0.01 7 (1984) 6.82 3.48 0.07 0.01 0.75 11.13 0.51 0.47 2.87 0.05 3.90 8 (1985) 2.35 2.78 0.07 0.03 1.00 6.23 1.00 0.94 3.83 0.10 5.87 9 (1986) 0 2.78 0.07 0.03 1.20 4.08 1.50 0.94 4.79 0.10 7.33 10 (1987) 0 0 0.07 0.03 1.45 1.55 1.99 0.94 5.74 0.10 8.77 11-34 (1988-2011) 0 0 0.07 0.03 1.45 1.55 2.47 0.94 5.74 0.10 9.25 35 (2012) 0 0 0.07 0.03 1.45 1.55 18.18 0.94 7.69 0.10 26.91 Economic rate of return: 12%

Incremental project Year Capital O&M Total benefits

Cipamingkis

1 (1978) 0.99 0 0.99 0 2 (1979) 2.25 0 2.25 0 3 (1980) 2.73 0 2.73 0 4 (1981) 2.42 0 2.42 0 5 (1982) 1.01 0.04 1.05 0.22 6 (1983) 0 0.05 0.05 0.63 7 (1984) 0 0.05 0.05 1.03 8 (1985) 0 0.05 0.05 1.44 9 (1986) 0 0.05 0.05 1.84 10-35 (1987-2012) 0 0.05 0.05 2.03

Economic rate of return: 13% - .50-

8. AGREEMENTS REACHED AND RECOMMENDATION

8.01 During negotiations, agreement has been reached with the Government on the following points:

(a) GOI would proceed with the construction of Jragung Dam in accord- ance with a time schedule to be agreed between the Borrower and the Bank to ensure the full realization of benefits contemplated by the inclusion of preliminary works in this project (para. 1.22);

(b) prior to the initiation of feasibility studies for the 20,000 ha irrigation area, and the detailed designs of flood control plans for the lower Cimanuk, Cipanas and Ciwaringin rivers, the Borrower shall obtain the approval of the Bank (para. 3.19);

(c) to minimize late construction starts requiring some financing by the GOI, invitations to bid would be issued as bid documents are completed, and bids would be received and processed without waiting for the project implementation budget (DIP) to be signed, but contracts would be awarded only after the DIP is approved; and price escalation clauses would be included in local civil works contracts extending beyond one year (para. 3.34);

(d) the Jatiluhur Authority, PROSIDA, Proyek Hidrologi and Proyek Cimanuk each would: (i) maintain separate accounts for the project; (ii) engage auditors aceptable to the Bank to audit these accounts; and (iii) submit to the Bank audited financial statements within six months of the end of each fiscal year, together with the auditor's comments and opinions (para. 3.36);

(e) GOI would consult with the Bank before appointing a replacement for the President Director of the Jatiluhur Authority; and the General M4anagers of PROSIDA, Proyek Hidrologi and Proyek Cimanuk and would cause the project implementing agencies to be adequately staffed at all times with competent and qualified personnel (para. 4.01);

(f) GOI would engage advisors to Proyek Hidrologi on: (i) hydro- meteorology; (ii) hydrology; (iii) sedimentation; (iv) hydrometric automatic data processing equipment; and to Proyek Cimanuk, (v) river management and control by November 30, 1978 (para. 4.09);

(g) All other consultants required for design and construction, devel- opment of a master plan, feasibility studies, and review and completion of plans and designs would be engaged by November 30, 1978 (para. 4.09);

(h) GOI shall cause the DGWRD to appoint a panel of consultants, whose qualifications and experience shall be acceptable to the Bank, to review the planning, design and construction of Jragung Dam (and any additional dams as may be agreed between the Borrower and the Bank) throughout the period of planning, design and con- - 51 -

struction of such dams, to ensure the quality of their designs and safety, and cause such panel to be consulted prior to the execu- tion of all major changes in the design or construction of any of the said dams (para. 4.10);

(i) GOI would take the necessary steps to ensure that adequate credit and agricultural inputs (including fertilizer, agricultural chem- icals and certified seed) are made available at the village level in the Cipamingkis subproject area and assist in the provision of drying and storage facilities (para. 4.13);

(j) a water-user association would be formed for each tertiary unit in the Cipamingkis subproject area to participate in the unit's construction and to take over its operation and maintenance after project completion (para. 4.14);

(k) adequate O&M funds, adjusted to keep pace with inflation and annual needs, would be allocated to all Bank-assisted irrigation systems in future years; GOI would take the necessary steps to ensure that at least half of the budgeted O&M funds would be released to subprojects by August 15 of each year and the balance, in equal quarterly installments thereafter, until the total amounts are fully released; to upgrade the standard of O&M services and to effec- tively utilize the available funds, GOI would progressively increase the number of qualified O&M personnel in the Bank-assisted projects until the additional numbers to be established by GOI in consultation with the Bank are employed; and GOI would inform the Bank by December 31 of each year of the proposed number of O&M personnel and per hectare O&M budget for each subproject; and by June 1 of each following year, it would submit the approved O&M budget and by October 1, the staffing provisions (para. 4.17);

(1) adequate staff and funds, adjusted to keep pace with inflation and actual needs, would be allocated to DPMA in future years to con- tinue the operation and maintenance of the hydrologic measurement stations (para. 4.18);

(m) GOI would ensure that the survey and evaluation of the economic and social benefits of the project would be carried out by the survey and evaluation services included in the Sixth Irrigation Project (para. 4.19); and

(n) following the completion of the Cipamingkis subproject, the Govern- ment would collect the adjusted IPEDA based on the increased productivity of irrigated land for which an irrigation system is rehabilitated or constructed following completion of the project; the amounts to be collected would be sufficient to ensure sound O&M practices and to recover a reasonable portion of the capital costs during the project's useful life, taking into account farmers' incentives and ability to pay; and it would submit to the Bank for review every two years the IPEDA rates collected for different land classes (para. 6.13). - 52 -

8.02 With the above assurances, the project would be suitable for a Bank loan of US$31.0 million, with a 20-year maturity including a grace period of 5 years. The Borrower would be the Republic of Indonesia. INDONESIA

IRRIGATION XI PROJECT

Cipamingkis Subproject

Cost Estimate

Foreign Base Local Foreign Total Local Foreign Total exchange cost ---- (Rp million) ------(US$ million) ------(%)

Civil works Weir 120 170 290 0.3 0.4 0.7 60 4 Primary and secondary canals 470 570 1,040 1.1 1.4 2.5 55 15 Canal structures 1,030 1,540 2,570 2.4 3.8 6.2 60 38 Tertiary canals 700 460 1,160 1.7 1.1 2.8 40 17 Drainage 60 60 120 0.1 0.2 0.3 50 2 Access and inspection roads 80 90 170 0.2 0.2 0.4 50 2 Office and housing 110 60 170 0.3 0.1 0.4 35 2

Subtotal civil works 2,570 2,950 5,520 6.1 7.2 13.3 54 80

Right-of-way 540 - 540 1.3 - 1.3 - 8

Vehicles and equipment 20 60 80 - 0.2 0.2 75 1

Consultants and training 70 300 370 0.2 0.7 0.9 80 6

Engineering and administration 260 70 330 0.6 0.2 0.8 20 5

Base cost estimate 3,460 3,380 6,840 8.2 8.3 16.5 50 100

Physical contingencies 890 890 1,780 2.1 2.2 4.3 50 25

Expected price increases 1,410 1,410 2,820 3.4 3.4 6.8 50 41

Total project cost 5,760 5,680 11,440 13.7 13.9 27.6 50 166

*__-P i INDONESIA

IRRIGATION XI PROJECT

Jragung Dam Project

Cost Estimate - Initial Stage

Foreign Base Local Foreign Total Local Foreign Total exchange cost ---- Rp million ------US$ million ------% ------

Civil works Access road 250 250 500 0.6 0.6 1.2 50 22 Diversion tunnel 340 410 750 0.8 1.0 1.8 55 33 Base camp 290 290 580 0.7 0.7 1.4 50 26

Subtotal civil works 880 950 1,830 2.1 2.3 4.4 52 81

Right-of-way 80 - 80 0.2 - 0.2 - 4

Vehicles and equipment - 80 80 - 0.2 0.2 90 4

Consultants 50 200 250 0.1 0.5 0.6 80 7

Engineering and administration 60 20 80 0.2 - 0.2 20 4

Base cost estimate 1,070 1,250 2,320 2.6 3.0 5.6 52 100

Physical contingencies 280 300 580 0.7 0.7 1.4 52 25

Expected price increases 300 320 620 0.7 0.8 1.5 52 32

Total project cost 1,650 1,870 3.520 4.0 4.5 8.5 52 157

.~~~~~~~~~~~~~~~~~., (D P M m >D INDONESIA

IRRIGATION XI PROJECT

Hydrologic Measurement Program

Cost Estimate

Foreign Base Local Foreign Total Local Foreign Total exchange cost --- (Rp million) ------(US$ million) ------% ------

Civil works Station construction 260 400 660 0.6 1.0 1.6 60 30

Subtotal civil works 260 400 660 0.6 1.0 1.6 60 30

Vehicles and equipment 70 640 710 0.1 1.6 1.7 90 32

Consultants and training 120 500 620 0.3 1.2 1.5 80 28

Engineering and administration 170 40 210 0.4 0.1 0.5 20 10

Base cost estimate 620 1,580 2,200 1.4 3.9 5.3 74 100

Contingencies 80 250 330 0.2 0.6 0.8 74 15

Expected price increases 120 380 500 0.3 0.9 1.2 74 23

Total project cost 820 2,210 3,030 1.9 5.4 7.3 74 138

HLTMD I ""-wXK INDONESIA

IRRIGATION XI PROJECT

Cimanuk River Water Management Program

Cost Estimate

Foreign Base Local Foreign Total Local Foreign Total exchange cost ------Rp million ------US$ million ------% ------

Consultants 240 960 1,200 0.6 2.3 2.9 80 76

Vehicles and equipment 30 260 290 0.1 0.6 0.7 90 16

Engineering and administration 100 20 120 0.2 0.1 0.3 20 8

Base cost estimate 370 1,240 1,610 0.9 3.0 3.9 79 100

Physical contingencies 10 30 40 - 0.1 0.1 79 3

Total project cost 380 1,270 1,650 0.9 3.1 4.0 79 103

I-Ptx1 X H m

m > INDONESIA

IRRIGATION XI

Jragung Dam Subprolect

Cost Estimate - Total Prolect

Foreign Base Local Foreign Total Local Foreign Total exchange cost - Rp million ------US$ million ------% ------

Civil works Jragung Dam Embankment 4,870 5,960 10,830 11.7 14.4 26.1 55 54 Spillway 490 590 1,080 1.2 1.4 2.6 55 5 Outlet works 170 250 420 0.4 0.6 1.0 55 2 Power plant 420 1,700 2,120 1.0 4.1 5.1 80 11 Transmission line 30 140 170 0.1 0.3 0.4 80 1 Tuntang diversion 170 250 420 0.4 0.6 1.0 55 2 Access road 250 250 500 0.6 0.6 1.2 50 2 Diversion tunnel 340 410 750 0.8 1.0 1.8 55 4 Construction camp 290 290 580 0.7 0.7 1.4 50 3 Road relocation 160 170 330 0.4 0.4 0.8 50 1 Coffer dam 20 20 40 - 0.1 0.1 55 -

Subtotal civil works 7,210 10.030 17,240 17.3 24.2 41.5 58 85

Right-of-way 500 - 500 1.2 - 1.2 - 2

Vehicles and equipment - 120 120 - 0.3 0.3 100 1

Consultants 350 1,390 1,740 0.8 3.4 4.2 80 9

Engineering and administration 430 110 540 1.0 0.3 1.3 20 3

Base cost estimate 8,490 11.650 20,140 20.3 28.2 48.5 58 100

Physical contingencies 2,110 2,910 5,020 5.1 7.0 12.1 58 25

Expected price increases 7,220 9,960 17,180 17.4 24.0 41.4 58 85

Total prolect cost 17,820 24.520 42,340 42.8 59.2 102.0 58 210 ANNEX I Table 3

INDONESIA

IRRIGATION XI PROJECT

Expected Price Increases

Calendar Year 1978 1979 1980 1981 1982 Total

Expected Annual Inflation Rate (%)

Civil works 14 12 10 8 8 Equipment and services 8 8 8 7 7

Estimated Annual Expenditures ------US$ million ------

Civil works Cipamingkis 1.7 4.1 4.9 4.2 1.7 16.6 Jragung 0.9 1.9 2.0 0.7 - 5.5 Hydrological measurement program 0.3 0.6 0.6 0.5 - 2.0

Subtotal 2.9 6.6 7.5 5.4 1.7 24.1

Equipment and Services Cipamingkis 0.5 0.9 1.2 1.1 0.5 4.2 Jragung 0.2 0.5 0.6 0.2 - 1.5 Hydrological measurement program 0.6 1.2 1.2 1.1 - 4.1 Cimanuk river water management program 0.7 1.6 1.6 0.1 - 4.0

Subtotal 2.0 4.2 4.6 2.5 0.5 13.8

Expected Price Increases

Civil works 0.1 1.5 2.6 2.4 0.8 7.3 Equipment and services - 0.4 0.8 0.7 0.3 2.2

Total 0.1 1.9 3.3 3.1 1.1 9.5 ANNEX 1 Table 4

INDONESIA

IRRIGATION XI PROJECT

Estimated Schedule of Expenditures

Calendar Year Total 1978 1979 1980 1981 1982 ------(US$ million) ------

Civil Works Cipamingkis 13.3 1.4 3.4 3.9 3.3 1.3 Jragung 4.4 0.7 1.5 1.6 0.6 - Hydrological measurement program 1.6 0.3 0.4 0.5 0.4 -

Subtotal 19.3 2.4 5.3 6.0 4.3 1.3

Right-of-Way 1.5 0.3 0.7 0.3 0.2 -

Vehicles and Equipment 2.8 0.5 1.1 0.9 0.3 -

Consultants and Training 5.9 0.8 1.6 1.6 1.4 0.5

Engineering and Administration 1.8 0.3 0.5 0.5 0.4 0.1

Base cost estimate 31.3 4.3 9.2 9.3 6.6 1.9

Physical Contingencies 6.6 0.8 1.8 2.0 1.5 0.5

Excpected Price Increases 9.5 0.1 1.9 3.3 3.1 1.1

Total project cost 47.4 5.2 12.9 14.6 11.2 3.5 ANNEX I Table 5

INDONESIA

IRRIGATION XI PROJECT

Estimated Schedule of Disbursements

IBRD fiscal year Cumulative disbursements and semester (US$'000 equivalent)

FY79 First 500 Second 3,500

FY80 First 6,000 Second 9,000

FY81 First 12,500 Second 16,000

FY82 First 20,000 Second 24,000

FY83 First 27,000 Second 30,000

FY84 First 31,000 ANNEX 1 Table 6

INDONESIA

IRRIGATION XI PROJECT

Proposed Allocation of Proceeds of Loan

Cost Loan Total Foreign amount

… (US$ million) ------

I. Civil Works Jatiluhur Authority 13.3 7.2 13.1 PROSIDA 4.4 2.3 4.3 DPMA 1.6 1.0 1.6 Physical contingencies 2.4 1.3 - Expected price increases 5.4 2.9 -

Subtotal 27.1 14.7 19.0

II. Vehicles and Equipment Jatiluhur Authority 0.2 0.2 0.2 PROSIDA 0.2 0.2 0.2 DPMA 1.7 1.6 1.7 DOR 0.7 0.6 0.7

Subtotal 3.0 2.9 2.8

III. Consultants, Field Investigations and Start-Up Vehicles Jatiluhur Authority 0.8 0.6 0.9 PROSIDA 0.6 0.5 0.6 DPMA 1.2 1.0 1.3 DOR 2.9 2.3 3.1 Physical contingencies 0.4 0.2 -

Subtotal 5.9 4.6 5.9

IV. Training Jatiluhur Authority 0.1 0.1 0.1 DPMA 0.3 0.2 0.3

Subtotal 0.4 0.3 0.4

V. Unallocated Balance of physical contingencies 3.8 2.1 0.9 Balance of expected price increases 4.1 2.2 2.0 Right-of-way acquisition 1.5 - - Engineering and administration 1.8 0.4 -

Subtotal 11.2 4.7 2.9

Total 47.4 26.9 31.0 ANNEX 1 Table 7

INDONESIA

IRRIGATION XI PROJECT

Vehicles and Equipment

Item Quantity Unit cost Total cost - …____ (US$) --

l. Cipamingkis Vehicles Jeeps 12 7,000 84,000 Motorcycles 25 640 16,000 Bicycles 50 200 2,000 Subtotal 102,000

Equipment Soil laboratory equipment L.S. 30,000 30,000 Radio telecommunications equipment L.S. 48,000 48,000 Office equipment & supplies L.S. 20,000 20,000 Subtotal 98.000

Total 200,000

II. Jragung Vehicles Jeeps 6 7,000 42,000 Subtotal 42,000

Equipment Geologic equipment L.S. 120,000 120,000 Survey equipment L.S. 20,000 20,000 Office equipment & supplies L.S. 18,000 18, 000 Subtotal 158,000

Total 200.000

III. Hydrologic Measurement Program Vehicles Station wagons (4 Wh-dr) 21 13,000 275,000 Sedans 2 10,000 20,000 Subtotal 295.000

Equipment Hydrographic Screamflow measurement /a 18 sets 4,000 72,000 Water stage recorders 150 1,500 225,000 Water sampling /b 18 sets 2,500 45,000 Parts and supplies L.S. 88,000 88,000 Climatologic Climatologic stations Ic 20 sets 9,500 190,000 Recording rain gauges 40 1,250 50,000 Hydrogeometric Observation well /d 20 sets 2,500 50,000 Sore hole logger /e I set 50,000 50,000 Mobile water quality lab. 1 30,000 30,000 Computer equipment /f 1 set 240,000 240,000 Environmental quality equipment L.S. 200,000 200,000 Printing machine 1 85,000 85,000 Hi-speed copying machine 1 50,000 50,000 Workshop equipment L.S. 10,000 10,000 Office equipment & supplies L.S. 20,000 20,000 Subtotal 1.405,000

Total 1,700,000

IV. Cimanuk River Water Management Protram Vehicles Jeeps 6 7,000 42,000 Subtotal 42,000

Equipment Geologic equipment L.S. 250,000 250,000 Hydrographic equipment L.S. 75,000 75,000 Survey equipment L.S. 100,000 100,000 Soil laboratory L.S. 163,000 163,000 Office equipment & supplies L.S. 70,000 70,000 Subtotal 658,000

Total 700,000

/a Includes current meters, lines, reels, cranes, boats, etc., for wading and light hand line measurements as well as for heavy-duty measurement. /b Includes two hand samplers and one heavy-duty sampler in each set. Ic Includes equipment to obtain complete climatological data (precipitation, temperature, evaporation, wind speed and relative humidity). /d Includes water level sensor and recorder. Ie Includes electric resistivity, potential, nuclear and caliper logging and flow measurement. /f Includes (2)D-MAC pencil followers; (2)D-MAC control consoles; (2) IBM 029 cardpunch machines; (2) Datagrid digitizers; (5) IBM composers; and mis- cellaneous spare parts. INDONESIA

IRRIGATION XI PROJECT

Crop Production Costs: Physical Inputs

C I P A M I N K I S Inputs/ha J R A G V N G Wet Season Dry Season Wet Season Dry Season Rainfed rice Irrigated rice Irrigated rice Red pepper Soybeans Rainfed rice Irrigated rice Irrigated rice Tobacco Corn I II

Present Cultivation (animal days) 20 20 15 20 10 17 17 Seed (kg) 40 17 15 10 40 40 0.4 30 50 Fertilizer (kg) 40 50 50 60 Urea 50 125 75 100 100 25 TSP 40 100 125 10 25 25 20 Organic 10 10 25 compost 500 Agrochemicals (it) insecticides 1 1 2.5 0.5 0.5 2 (gr) zinc phosphide 50 50 Harvesting (Z crop yield/ha) 3 3 3 3 3 3 Interest (% month) /a 3 3 2 2 2 2 2 2 2 2 2 2 Future Without Project Cultivation (animal days) 20 20 20 20 10 17 17 Seed (kg) 40 15 10 40 40 0.4 30 50 Fertilizer (kg) 30 50 60 60 120 100 25 Urea 10 200 125 75 30 25 25 10 TSP 50 125 Organic compost 500 Agrochemicals (It) insecticides 1 1.5 1.5 2.5 0.5 1.5 (gr) zinc phosphide 50 2 1 50 50 Harvesting (% crop yield/ha) 3 3 3 3 Interest (% month) /a 3 3 3 2 1 1 2 2 2 1 2 2 Future With Project Cultivation (animal days) 20 20 20 10 Seed (kg) 17 17 17 30 30 0.4 30 40 Fertilizer (kg) 30 30 Urea 200 200 100 TSP 50 200 200 50 50 25 Agrochemicals 35 15 50 50 (It) insecticides 2.5 2.5 2.5 2 1 2.5 2.5 (gr) zinc phosphide 100 100 Harvesting 100 100 100 (% crop yield/ha) 3 3 Interest 3 3 3 (% month) /a 1 1 2 2 2 1 1

/a Rice - interest is charged on 90% (cash inputs - harvesting costs) for six months rainfed rice; Red pepper for seven months irrigated rice. & soybeans - interest is charged on 90% of cash inputs for three months. Tobacco - interest is charged on 90% (cash inputs - harvesting costs) for five monthsr Corn - interest Hi1 is charged on 90% (cash inputs - harvesting costs) for three months. ANNEX 2 Table 2

INDONESIA

IRRIGATION XI PROJECT

Monthly Crop Labor Requirements (man-day/ha)

Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec. Total

CIPAMINGKIS Wet Season Rainfed rice P /a 32 28 9 20 19 10 - - - - 20 32 170 w 32 28 9 20 19 10 - - - - 20 32 170

Irrigated rice P 35 33 13 28 19 10 - - - - 20 32 190 W 37 35 15 30 21 10 - - - - 20 32 200 W 35 36 35 35 27 - - - - - 20 32 220

Dry Season Irrigated rice P - - - 20 42 42 20 31 25 - - - 180 W - - - 20 45 45 22 33 25 - - - 190 W - - 10 42 55 30 30 53 - - - - 220

Red pepper P - - - - - 30 20 20 30 30 130 W - - - - - 30 20 20 30 30 130 W - - - - - 30 25 20 30 35 140

Soybeans P - - - 10 23 18 14 23 22 - - - 110 W - - - 10 23 18 14 23 22 - - - 110 w - - 10 25 21 16 25 23 - - - - 120

JRAGUNG Wet Season Rainfed P 38 33 12 20 19 10 - - - - 22 36 190 rice I W 38 33 12 20 19 10 - - - - 22 36 190 w 30 26 12 20 22 12 - - - - 22 36 180 Rainfed rice II P 30 24 9 20 19 10 - - - - 22 36 170 Irrigated rice P 33 30 13 27 19 10 - - - - 22 36 190 W 33 32 35 35 27 - - - - - 22 36 220 W 33 32 35 35 27 - - - - - 22 36 220 Dry Season Irrigated rice W - - 10 42 55 30 30 53 - - - - 220

Tobacco P - - - - 50 44 18 33 50 55 - - 250 W - - - - 50 44 18 33 55 60 - - 260 Corn P - - - 10 19 9 16 16 - - - - 70 W - - - 10 19 9 16 16 - - - - 70

/a P = Present W = Future without project W = Future with project INDONESIA ANNEX2 lRRICATION XI PROJECT Table 3

Crop Production Costs /a

C I P A M I N K I S J R A G U N G Wet Season _ - _Dry Season Wet Season Dry Season Rainfed rice Irrigated rice Irrigated rice Red pepper Soybeans I Rainfed rice It Irrigated rice Irrigated rice Tobacco Corn

PRESENT Cash Inputs (Pp'000/ha)/b Cultivation /c 20.0 (20.0) 20.0 (20.0) 15.0 (15.0) 12.0 (12.0) 0 0 15.3 (15.3) 15.3 (15.3) 15.3 (15.3) 13.5 (13.5) 9.5 (9.0) Seed 3.2 (2.6) 3.2 (2.6) 3.2 (2.6) 0.1 (0.1) 4.7 (3.9) 4.0 (3.3) 3.2 (2.6) 4.0 (3.3) 10.8 (10.8) 3.0 (2.4) Fertili-er 6.5 (4.3) 13.5 (8.9) 13.5 (8.9) 5.0 (5.0) 1.9 (1.4) 3.7 (2.5) 5.4 (3.6) 13.5 (8.9) 25.7 (17.8) 8.3 (5.3) Agrochenicals - - 4.2 (1.0) 4.2 (1.0) 10.3 (2.3) 2.1 (0.5) - - - (0) 2.1 (0.5) 8.2 (1.8) 0 (0) Harvesting 4.3 (3.5) 6.2 (5.1) 4.1 (3.3) - - - - 3.4 (2.7) 3.8 (3.1) 6.7 (5.5) 4.8 (4.8) 1.2 (1.0) Interest - (3.0) - (3.5) - (3.2) - (1.0) - (0.9) - (2.6) - (3.1) - (3.1) - (4.3) - (0.8) Other 1.1 (0.6) 1.9 (1.9) 2.0 (2.0) 1.6 (1.6) 2.3 (2.3) 1.6 (1.6) 2.3 (2.3) 1.4 (1.4) 2.0 (2.0) 2.4 (2.4)

Total cash inputs 35.0 (34.0) 49.0 (43.0) 42.0 (36.0) 29.0 (22.0) 11.0 (9.0) 28.0 (28.0) 30.0 (30.0) 43.0 (38.0) 65.0 (55.0) 24.0 (21.0)

Labor Inputs (nan-days/ha) Land preparation 40 40 40 25 25 45 45 45 60 10 Planting 40 40 40 10 35 50 40 40 25 13 Crop rnaagerent 50 60 55 35 20 55 45 55 45 25 Harvesting 40 50 45 60 30 40 40 50 120 20

Total labor inputs 170 190 180 130 110 190 170 190 250 70

FUTURE WITHOUT PROJECT Cash Inputs (Rp'000/ha)/b Cultivation /c 20.0 (20.0) 20.0 (20.0) 15.0 (15.0) 12.0 (12.0) 0 0 15.3 (15.3) 15.3 (15.3) 13.5 (13.5) 9.0 (9.0) Seed 4.1 (3.2) 5.3 (4.2) 5.3 (4.2) 0.1 (0.1) 5.8 (4.6) 5.1 (4.1) 4.0 (3.2) 10.8 (10.8) 4.1 (3.2) Fertili-er 9.6 (7.7) 20.5 (16.4) 17.1 (13.7) 5.0 (5.0) 3.1 (2.5) 4.7 (3.8) 34.2 (27.3) 32.9 (26.3) 10.5 (8.4) Agroche.ical. 4.1 (0.9) 6.3 (1.5) 6.3 (1.5) 10.3 (2.3) 2.1 (0.5) - - 10.5 (2.5) 8.2 (1.8) 0 (0) Harvesting 6.1 (4.9) 8.9 (7.0) 5.5 (4.4) - - - - 4.3 (3.4) 12.2 (9.7) 6.0 (6.0) 1.8 (1.5) Interest - (3.2) - (2.9) - (2.4) - (1.0) - (1.4) - (2.8) - (3.2) - (5.0) - (1.3) Other 2.1 (2.1) 3.0 (3.0) 1.8 (1.8) 1.6 (1.6) 2.0 (2.0) 1.6 (1.6) 2.8 (2.8) 2.6 (2.6) 1.6 (1.6)

Total cash inputs 46.0 (42.0) 64.0 (55.0) 51.0 (43.0) 29.0 (22.0) 13.0(11.0) 31.0 (31.0) 79.0 (64.0) 74.0 (66.0) 27.0 (25.0)

Labor Inputs (nan-days/ha) Land preparation 40 40 40 25 25 45 45 60 10 Planting 40 40 40 10 35 50 40 25 15 Crop tnaagement 50 65 65 35 20 55 75 45 25 Harvesting 40 55 45 60 30 40 60 130 20

Total labor inputs 170 200 190 130 110 190 220 260 70

FUTURE WIT0 PROJECT Cash Inputs (Rp'000/h.)/b Cultivation /c 20.0 (20.0) 15.0 (15.0) 12.0(12.0) 0 0 15.3 (15.3) 15.3 (15.3) 15.3 (15.3) Seed 4.0 (3.2) 4.0 (3.2) 0.1 (0.1) 6.6 (5.1) 4.7 (3.7) 4.0 (3.2) 4.0 (3.2) Fertlli-er 34.2 (27.3) 34.2 (27.3) 17.1(13.7) 4.3 (3.4) 8.8 (7.1) 34.2 (27.3) 34.2 (27.3) Agrochenicals 10.5 (2.5) 10.5 (2.5) 10.3 (2.3) 8.2 (1.8) 4.4 (1.1) 10.5 (2.5) 10.5 (2.5) harvesting 12.9 (10.2) 12.9 (10.2) - - - - 5.8 (4.6) 12.2 (9.7) 13.2 (10.4) Interest - (3.4) - (3.4) - (2.4) - (0.8) - (3.2) - (3.2) - (3.5) Other 2.4 (2.4) 2.4 (2.4) 5.5 (5.5) 1.9 (1.9) 3.0 (3.0) 2.8 (2.8) 2.8 (2.8)

Total cash inputs 84.0 (69.0) 79.0 (64.0) 45.0(36.0) 21.0 (13.0) 42.0 (38.0) 79.0 (64.0) 80.0 (65.0)

Labor Inputs (nan-days/ha) Land preparation 40 40 25 25 45 45 45 Planting 40 40 10 35 40 40 40 Crop nanag..emt 80 80 40 25 50 70 70 harvesting 60 60 65 35 45 65 65

Total labor inputs 220 220 140 120 180 220 220

/a Economic prices, based on current and projected world market prices for rice, soybeans, corn and fertilizers. Figures in parenthesis are financial prices. Prices used are shown in Chapter 6, Tables 6.1 and 6.2. All prices are at constant nid-1978 levels.

/b Physical inputs are given in Asses 2, Table 1.

/c Cost of contracting a pair of bullocks aod as operator is Rp 1,000/animal day in Cipaingkis and Rp 900/anial day in Jragung. INDONESIA

IRRIGATION XI PROJECT

Crop Budgets /a

C I P A M I N K I S J R A G U N G Wet Season Dry Season Wet Season Dry Season Rainfed rice Irrigated rice Irrigated rice Red pepper Soybeans Rainfed rice Irrigated rice Irrigated rice Tobacco Corn I II

PRESENT

Yield (ton/ha) 1.8 2.6 1.7 1.2 0.4 1.4 1.6 2.8 0.2 0.8 Farm-gate price (Rp'000/ton) 65 65 65 300 130 65 65 65 800 40 Gross value of production (Rp'000/ha) 117.0 169.0 111.0 360.0 52.0 91.0 104.0 182.0 160.0 32.0 Production costs, excl. labor (Rp'OOO/ha) 34.0 43.0 36.0 22.0 9.0 28.0 30.0 38.0 55.0 21.0 Net value of production excl. labor (Rp'000/ha) 83.0 126.0 75.0 338.0 43.0 63.0 74.0 144.0 105.0 11.0 Labor requirements (man-days/ha) 170 190 180 130 110 190 170 190 250 70

FUTURE WITHOUT PROJECT

Yield (ton/ha) 2.0 2.9 1.8 1.2 0.4 1.4 4.0 0.25 0.9 Farm-gate price (Rp'000/ton) 81 81 81 300 154 81 81 800 54 Gross value of production (Rp'000/ha) 162.0 235.0 146.0 360.0 62.0 113.0 324.0 200.0 49.0 Production costs, excl. labor (Rp'000/ha) 42.0 55.0 43.0 22.0 11.0 31.0 64.0 66.0 25.0 Net value of production excl. labor (Rp'000/ha) 120.0 180.0 103.0 338.0 51.0 82.0 260.0 134.0 24.0 Labor requirements (man-days/ha) 170 200 190 130 110 190 220 260 70

FUTURE WITH PROJECT

Yield (ton/ha) 4.2 4.2 1.8 0.6 1.9 4.0 4.3 Farm-gate price (Rp'000/ton) 81 81 300 154 81 81 81 Gross value of production (Rp'000/ha) 340.0 340.0 540.0 92.0 154 324.0 348.0 Production costs, excl. labor (Rp'OO0/ha) 69.0 64.0 36.0 13.0 38 64.0 65.0 Net value of production excl. labor (Rp'000/ha) 271.0 276.0 504.0 79.0 116 260.0 283.0 Labor requirements (man-days/ha) 220 220 180 120 220 220

/a Calculated using financial prices and costs based on Annex 2, Table 3 and Table 6.2.

sz INDONESIA

IRRIGATION XI PROJECT

Farm Budgets

C I P A M I N K I S J R A G U N G 0.2 ha farm 0.5 ha farm 1.2 ha farm 0.5 ha Farm Present W project/a W project Present W project W project Present W project W project Present W project W project

Cropped area (ha) Wet season - rainfed rice - - - 0.17 0.17 0 0.42 0.42 - 0.25 - - - irrigated rice 0.20 0.20 0.20 0.33 0.33 0.50 0.78 0.78 1.20 0.25 0.50 0.50 Dry season - irrigated rice 0.10 0.10 0.11 - - 0.10 - - 0.12 - - 0.48 - soybeans - - 0.03 0.03 0.03 0.13 0.19 0.19 0.48 0.15 0.15 - (tobacco)L - red pepper 0.02 0.02 0.05 0.15 0.15 0.18 0.13 0.13 0.14 0.12 0.20 - (corn) Total cropped area 0.32 0.32 0.39 0.68 0.68 0.91 1.52 1.52 1.94 0.77 0.85 0.98 Cropping intensity (1) 160 160 195 136 136 182 127 127 162 154 170 195 Crop Production (kg) Paddy 690 760 1,300 1,160 1,300 2,520 2,780 3,100 5,540 1,050 2,000 4,060 Soybean - - 20 10 10 80 80 80 290 (t) 30 40 - Red pepper 20 20 90 180 180 320 160 160 250 (c) 100 180 - Farm Income (Rp'000) Gross value of production /b 52 69 135 131 161 313 238 310 569 96 202 329 Production costs, excl. labor /b 13 16 23 24 29 49 52 65 102 27 47 63 Hired labor cost - harvesting /c 5 7 13 9 13 24 22 30 54 8 19 39 - other /d ------1 1 14 - Net value of production 34 46 99 98 119 240 163 214 399 61 136 227 Land tax (IPEDA) /e 1 1 3 3 3 7 8 8 16 2 5 7 O&M costs, farm irrigation systems /f - - I - - 2 1 1 5 - 2 2

Payments to landlord 17 23 49 49 59 120 82 107 206 30 68 113 Net crop income - owner-operator 33 45 96 95 116 233 154 205 378 59 129 218 - sharecropper 17 23 49 49 60 119 80 106 190 31 67 113 Other income /h 70 70 70 60 60 50 40 40 20 50 50 40 Total net farm income - owner operator 103 115 166 155 176 283 194 245 398 109 179 258 - sharecropper 87 93 119 109 120 169 120 146 210 81 117 153 Total labor requirements (man-day) 57 62 81 117 124 180 25 270 373 141 163 216

/a U - Future without project; W - Future with project. /b Based on Table 4, Crop Budgets. /c Calculated at 12% of gross paddy production. /d Based on maximum 40 man-days/month farm of family labor; and at Cipamingkis an average wage of Rp 350/man-day. /e Average annual land tax rates/ha are Rp 7,000/ha now and Rp 13,000/ha with the project at Cipamingkis; and Rp 4,000 now, Rp 10,000 without the project, and Rp 14,000/ha with the project at Jragung. /f For tertiary and quaternary units, annual O&M/ha is estimated at Rp 500 now and Rp 4,000 with the project at Cipamingkis and Jragung. Rp 3,000 and Rp 4,000 at : ¢ z /g Landlord and sharecropper share equally gross production less harvesting and other production costs, except for the land tax which the landlord pays, fa x and l-bor hich the sharecropper provides. /h Based on interviews and Bank surveys. /i Tobacco and corn represent the secondary crops at Jragung. ANNEX 3

INDONESIA

IRRIGATION XI

Schedule of Early Events

Activity Target date

General

1. Appoint consultants

(a) Cipamingkis Subproject Nov. 1978 (b) Jragung Subproject " 1978 (c) Cimanuk River Water Management Program " 1978 (d) Hydrologic Measurement Program " 1978

2. Employ advisors

(a) Directorate of Rivers Nov. 1978 (b) Directorate of Hydraulic Engineering " 1978

Cipamingkis Subproject

1. Initial design of tertiary systems Oct. 1978 2. Complete review and detailed design of weir and primary and secondary canals Dec. 1978 3. Invite bids and award first constructioncontract Oct. 1978-July 1979

Jragung Subproiect

1. Complete detailed designs June 1978 2. Invite bids and award first constructioncontract July-Oct. 1978

Hydrologic MeasurementProgram

1. Civil works

(a) Prepare designs and specificationsfor typical measurement stations Oct.-Dec. 1978 (b) Invite bids and award contract for constructionof first group of measurement stations Jan.-Mar. 1979

2. Equipment

(a) Prepare specificationsfor measurement equipment Oct.-Dec. 1978 (b) Invite bids and award contracts for measurement equipment Jan.-Mar. 1979 ANNEX 4 Page 1

INDONESIA

IRRIGATIONXI

Related Documents and Data Available in the Project File

A. General reports and studies relating to the agricultureand irrigation sector.

A.1. World Bank, "IndonesiaDevelopment Prospects and Needs Basic Economic Report," Report No. 708-IND, April 15, 1975.

B. General reports and studies relating to the project.

B.l. Republic of Indonesia,Jatiluhur Authority, "Summary of 1972 Report on CipamingkisIrrigation Project by P. T. Indah Karya," Indonesia,September 1976.

B.2. Republic of Indonesia,Jatiluhur Authority, and P. T. Indah Karya, "Data on Hydrology for CipamingkisIrrigation Project," Indonesia,1972 (Extract from Report).

B.3. Republic of Indonesia,Jatiluhur Authority, "General Plan, CipamingkisIrrigation Area, Conclusionand Recommendations," (translatedfrom Indonesian),1972.

B.4. Republic of Indonesia,Jatiluhur Authority, Directorate of Irrigation,Sub-Directorate of AgriculturalDevelopment. "AgriculturalDeveloment of CipamingkisProject Area," Indonesia 1976, (Includingsupplement).

B.5. Republic of Indonesia,Jatiluhur Authority, "ConstructionCost Estimate for CipamingkisIrrigation Project, Renewed and Revised in August 1976."

B.6. Republic of Indonesia,Jatiluhur Authority, "Report on Cipamingkis IrrigationProject," July 1977.

B.7. Republic of Indonesia,Jatiluhur Authority, "Report on Cipamingkis IrrigationProject, Annexes, Tables and Drawings,"July 1977.

B.8. Republic of Indonesia,Jatiluhur Authority, "Hydrologyand Water Balance Computation,"December 1977. ANNEX 4 Page 2

B.9. Republic of Indonesia,Directorate General of Water Resources Development;Kingdom of Netherlands,Directorate of International Technical Assistance;and NEDECO, "JratunselunaBasin Development Project, ExplanatoryNote on the Rehabilitationof the Main Drainage Systems in the Plain of East Semarang, Part 1," May 1974.

B.10. Republic of Indonesia,Directorate General of Water Resources Development and Engineering Consultants Inc. (ECI), "Jragung Dam, Multi-PurposeIrrigation, Flood Control, Hydro Electric and Municipal and IndustrialWater Supply Project, Upgraded Feasibility Report," December 1976.

B.11. Republic of Indonesia,Directorate General of Water Resources Development and EngineeringConsultants Inc. (ECI), "Jragung Dam, Multi-Purpose Irrigation,Flood Control, Hydro Electric and Municipal and IndustrialWater Supply Project, Upgraded Feasibility Report, Executive Summary," December 1976.

B.12. Republic of Indonesia,Directorate General of Water Resources Development and EngineeringConsultants Inc. (ECI), "Jragung Dam, Multi-Purpose Irrigation,Flood Control, Hydro Electric and Municipal and IndustrialWater Supply Project, Upgraded Feasibility Report, Appendix 1, Economics," September 1976.

B.13. Republic of Indonesia,Directorate General of Water Resources Development and Engineering Consultants Inc. (ECI), "Jragung Dam, Multi-PurposeIrrigation, Flood Control, Hydro Electric and Municipal and IndustrialWater Supply Project, Upgraded Feasibility Report, River Diversion Works, Cost Estimate,"September 1977.

B.14. Republic of Indonesia,Directorate General of Water Resources Development and Engineering ConsultantsInc. (ECI), "Jragung Dam, Multi-Purpose Irrigation,Flood Control, Hydro Electric and Municipal and IndustrialWater Supply Project, Quarterly Progress Report No. 1," June 1977.

B.15. Republic of Indonesia,Directorate General of Water Resources Development and Engineering Consultants Inc. (ECI), "Jragung Dam, Multi-Purpose Irrigation,Flood Control, Hydro Electric and Municipal and IndustrialWater Supply Project, Quarterly Progress Report No. 2," September 1977.

B.16. Burns and McDonnell and Trans-Asia EngineeringAssociates, Inc., "Water Supply Master Plan for the City of Semarang,Indonesia," November 1976. ANNEX 4 Page 3

B.17. Republic of Indonesia, DirectorateGeneral of Water Resources Development and EngineeringConsultants Inc. (ECI), "First-Phase Water Supply Feasibility Study for the City of Semarang, Indonesia," November 1976.

B.18. Republic of Indonesia, Directorate General of Water Resources Development and Engineering Consultants Inc. (ECI), "Appendix - SupplementalInformation for the Water Supply Master Plan and the First-PhaseWater Supply Feasibility Study for the City of Semarang, Indonesia,"November 1976.

B.19. Republic of Indonesia, Directorate General of Water Resources Development,Institute of Hydraulic Engineering;and G. W. Caughran, "A Programme for Obtaining Accurate StreamflowRecords in Indonesia," September 1976.

B.20. Republic of Indonesia, Directorate General of Water Resources Development, Institute of Hydraulic Engineering;and G. W. Caughran, "A Programme for Obtaining Accurate Streamflow Records in Indonesia," "Appraisal and Recommendationsfor Hydrometry in Jawa Timor and Madura," March 1977.

B.21. Republic of Indonesia, Directorate General of Water Resources Development,Institute of Hydraulic Engineering,"Application for Assistance for the Improvementof Hydrologic Data Collection, Processing and Evaluation in Indonesia,"October 1977.

B.22. Republic of Indonesia, Director General of Water Resources, Directorate of Rivers, "Master Plan of Cimanuk River Basin Develop- ment," July 1977.

B.23. Republic of Indonesia, Director General of Water Resources, Directorate of Rivers, "Lower Cimanuk River Flood Control and River Improvement,"July 1977.

B.24 Republic of Indonesia, Director General of Water Resources, Directorate of Rivers and Gadjah Mada University, "Project Report on Lower Cimanuk Flood Control and River Improvement,"Main Report and Executive Summary, September 1977.

B.25. Republic of Indonesia, Director General of Water Resources, Directorate of Rivers, "Master Plan of Cimanuk River Basin Develop- ment," September 1977. ANNEX 4 Page 4

B.26. Republic of Indonesia,Director General of Water Resources, Directorate of Rivers, "FinancialProposal: ConstructionLower Cimanuk Flood Control and Master plan for Cimanuk River Basin," October 1977.

B.27. Republic of Indonesia,Director General of Water Resources, Directorateof Rivers, "Master Plan of Cimanuk River Basin Deve- lopment, AdditionalData/Explanation for IBRD Team," October 1977.

C. Selected Working Papers

C.l. Cost Estimates,Working Papers

C.2. Price Structure for Fertilizers and Soybeans

C.3. Economic Analysis - Net Value of Producton at Full Project Development,Economic Cost and Benefits. INDONESIA IRRIGATION Xi CIPAMINGKIS AND JRAGUNG SUBPROJECTS IMPLEMENTATION SCHEDULE

1978 1979 1980 1981 1982 1983 1984

Calender Years CIPAMINGKIS SUBPROJECT WEIR, PRIMARY & SECONDARY CANALS DETA I LED DESIGN .m, TENDER AND AWARD CONSTRUCTION -111 TERTIARY CANALS AND DRAINAGE DETAILED DESIGN TENDER AND AWARD CONSTRUCTION - -_ JRAGUNG DAM SUBPROJECT ~-LOAN1 INITIAL STAGE TENDER AND AWARD CONSTRUCTION JRAGUNG DAM DETAILED DESIGN TENDER AND AWARD _I i CONSTRUCTION C -- LOAN 2

World B3ank-18590 F INDONESIA IRRIGATION Xi WATER RESOURCESORGANIZATION

MINISTER OF PUBLIC WORKS AND ELECTRIC POWER

DIRECTOR-GENERAL OF WATER RESOURCES DEVELOPMENT

|DIRECTCORATEOF | | DIRECTORATE OF I |DIRECTORAT_EOF| PLANNING AND DIRECTORATE DIRECTORATE OF DIRECTORATE IR IGTO HYDRAULIC |PROGAMMINGAN| | OF RIVER l l SWAMPS OF IRRIGTIO IRRIGAT ION ENINERN

PROYEH |CIMANUK l l PROSIDA HIDROLOGI

Wordd Bank-18765 INDONESIAPROJECT XI PROSIDAMANAGEMENT ORGANIZATION

[DIR. GENERAL| WATER RESOURCES DEVELOP.

| EXPERTS |- * NNA. _ ORYROUP

CHIEF CHIEF CHE ENGINEERING OP. & MAIN. ADNMIIT

|ENG./COiNSTRUc.| |ENG.13uRV.-DES.

ASST.T O A ASST.SST. FOR FOR GEN.M SUPERV. CONST.SURVEY FOR . & M. NCE

ASST. FOR _ ASS,T.FOR | ASST. FOR | ASST. FOR BUILDING/FAC| DEIGN HYDROLOG. | GEN. AFFAIR

MECH. EQUIPM. | BUDGET/REP. | AGRICULT | LOGISTIC AFFAIR |~~ ~~~~~~~~~~~~~~~~~~~ST FOR.FO

BUDGET/REPORT.

sue.PROJECT SUB. PROJECTS SUB. PROJECTS SUB. PROJECT SUB. PROJECT (E-SERIES) A-SERIES M B-SERIES C-SERIES D-SERIES ->

World Bank-16008 INDONESIA IRRIGATION XI Directorate of Hydraulic EngineeringOrganization

Director of Hydraulic Engineering

r Sub-Di S-b-~~Division SbDv

[mX3~~~~~~~~~~~~~~~~~~~~~~~~~~~~~evc DimntoSerc

Hydrometrics General Hydrau- Technical Geology Documentation Section IlicSection Section Section

Groundwater River Hydraulic Soil MechanicDismnto Hydrology Section Sechan Section Section

Water Quality Estuary & Shore |. Data Collection (Chemistry) Section Hydraulic Ston Structure Section D Section

General Hydrology World Bank -18513 INDONESIA IRRIGATIONXi Directorateof RiversOrganization

Directorof Rivers

Proyek R Plnnn 1st. Construction r 2nd Construction Swamp Operation Cimanuk River Planning Development Development and Maintenance

1st Section of 4th Section of iver Rehabili- Survey Section Construction Dev. Construction Dev. Rive Rehaioi Section Section tation Section

River Fiehabili- ~~2ndSection of 5th Section of RvrTann River Rehabili- Construction Dev. Construction Dev. River Training tationSection ~ ~ ~ ~ Setin ecio tto Section Section Lt Se

RiverControl 3rd Section of |6th Section of River Operation Q DesignRverContrl ConstructionDev. Construction Dev. and Maintenance I -i DesignSection Section Section Section 0

World Bank - 18514 4 INDONESIA IRRIGATION Xi Jatiluhur Authority Organization

Minister of State for Economy, Finance and Industry

Ministers of Public Works and Electric Power, Finance, Home Affairs and Agriculture

Jatiluhur Authority Board of Director

President Director

Director, Electric Director, Director, Administration Power Department Irrigation Department Department

Deputy Director Deputy Director Deputy Director Agriculture Division Development and Construction Division Operation and Maintenance Division

World Bank-18515 INDONESIA IRRIGATION PROJECTXI CipamingkisSubproject ProposedCropping Calendar

J F M A M J J A S 0 N D

Wet Season Paddy N

7,600 ha

H

C__ Dry Season Paddy N

2.000 ha T111111111 in H

a. Palawija (a) M 1,000 ha H b. Red pepper C 2,000 ha N (b) T

HM

Notation: mm

C - Cultivation 400 N - Nursery T - Transplant 300 M - Management H - Harvest 200

>- Average Rainfall (mm) 100

00 J F M A M J J A S 0 N D

World Bank - 18307 INDONESIA IRRIGATION PROJECTXl JragungSubproject ProposedCropping Calendar

J F M A M J J A S 0 N D

Wet SeasonPaddy N

10,500 ha -mM M

Dry SeasonPaddy N T 8,300 hav -

|Palawija I = HO~~~

Palawija 11 mm~~~~~~~~ M

MlawaMana F M M Note:Hay Farmersgrves4 00

- AverageRainfall (mm) 0

J F M A M ,i J A S 0 N 0 Note: Farmersmay grow Palawija crops after rice, however,these crops have not been included in economic anaylysis; World Bank - 18306 J IBRD 13142

100* 0630 1000 1194 MALAYSIA (IH 'iA 5.~~~~ Ibogo *, ~~~~~~MALAYSIA

S1.dy A- 4--',~SINGAPORE 004 ,-, .l.o 7,000 ha R.. ~&.dy A,.. ~ 1,LQ( ~h ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~~~1,~~

So osg, Dbrsh K'A LI M AN TA N 1000qhoo,0 3,500 ho

0,005,501~ ~ ~~ ~ ~~ ~ ~ ~ ~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~1,0h

V., E A-5AT -

S U LAW ES I Ioo,00,Soy,o-- .' AA-- 5,000510'.,h5

th. 2t,0G0h. a..a.1w a~~~~~P-,0005 mis6,000 d.. 011 Nay OaSrkpnfl Oo10prs3t 80,90 Irs

54,600 h. W. 5,0005 rojj- - Cob

PMtl INPONESW Oly Ko,O,h-101 C8odbO al0 ,16010 '~~ M RIGA1ONM PROJECT ''XI l,osos 60~i0 m0585Ops BR16;~~~~1oliPoojkfT Xi M.6i..~~~~POo,oRsobCIOioOa~~ & ondolro-pjo ls Ol'a ssoloo4l 0000,,tabIl1o 9 Ilffl IGAIOOo1ISJOT 15 511-0 hodOorr.005# 1s0 7 6on h. B.6r0 .2OOhO0040~'posro oosd6o 0100 I 55800ATIONi REjOAPITATtON

oat1a1101 051 011,0,ss 00100 950A0 , v a6hdo~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~0'0 fa O 00~j0 WITVONATIONALOOCIC06A1SCoso 001 -CloO-ola,,- - ~so~~sorol1010000 0-o a Ia srroaOrO LOMBOK

229,000Ir. SLOMBAWA , .lUlJa. I,3AN D 0 N E S I 0 100 0 o o o

106.~ ~~ ~ ~ ~ ~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~31

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Proposed Cipamingkis KIOETR MILES

IBRD 13531 t/ Ar cipntih9tsVrA A orThismap d b MARCH 1978

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E. sting Man Conols . A AlMD 0 E ANExisi,ng Irrigation Areas . Eisitng Weirs or Drms Proposed Weirs or Darms Sedeku Drainoge Subproject Boundory J A V A Proposed Reservoirs i ' Rivers 5 L A Roads / ~~~~~~~~~~~Demak R,.y

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