ASIAN DEVELOPMENT BANK PCR:PAK 20073
PROJECT COMPLETION REPORT
ON THE
SINDH FORESTRY DEVELOPMENT PROJECT (Loan 1076-PAK[SF])
IN
PAKISTAN
April 2003
CURRENCY EQUIVALENTS (as of 30 June 2001)
Currency Unit – Pakistan Rupees (PRe/PRs)
At Appraisal At Project Completion October 1990 June 2001 PRe1.00 = $0.0457 $.01586 $1.00 = PRs21.904 PRs63.05
ABBREVIATIONS
ADB – Asian Development Bank cft – cubic feet EA – executing agency EIRR – economic internal rate of return FIRR – financial internal rate of return FLMA – forest land management agreement FSMP – forestry sector master plan GIS – geographic information system GOS – Government of Sindh md – maund m3 – cubic meter MTR – midterm review PBME – project benefit monitoring and evaluation P&DD – Planning and Development Department PCR – project completion report PMO – Project Management Office PPAR – project performance audit report SDR – special drawing rights SFD – Sindh Forest Department SFDP – Sindh Forestry Development Project SFS – self financing system TA – technical assistance TCR – technical assistance completion report
NOTES
(i) The fiscal year (FY) of the Government and its agencies ends on 30 June. FY before a calendar year denotes the year in which the fiscal year ends, e.g., FY2000 ends on 30 June 2000.
(ii) In this report, "$" refers to US dollars.
CONTENTS
Page
BASIC DATA iii MAP ix
I. PROJECT DESCRIPTION 1 A. Background and Rationale 1 B. Objectives and Scope 1
II. EVALUATION OF DESIGN AND IMPLEMENTATION 2 A. Relevance of Design and Formulation 2 B. Project Outputs 3 C. Project Costs 5 D. Disbursements 6 E. Project Schedule 6 F. Implementation Arrangements 6 G. Conditions and Covenants 6 H. Consultant Recruitment and Procurement 7 I. Performance of Consultants, Contractors, and Suppliers 7 J. Performance of the Borrower and the Executing Agency 8 K. Performance of ADB 8
III. EVALUATION OF PERFORMANCE 9 A. Relevance 9 B. Efficacy in Achievement of Purpose 9 C. Efficiency in Achievement of Outputs and Purpose 9 D. Preliminary Assessment of Sustainability 10 E. Institutional Development and Other Impacts 10
IV. OVERALL ASSESSMENT AND RECOMMENDATIONS 12 A. Overall Assessment 12 B. Lessons Learned 12 C. Recommendations 13
APPENDIXES 1. Detailed Description of Project Components 16 2. Estimated Targets and Accomplishments for the Period of 1993 to 2003 Under the Sindh Forestry Sector Master Plan 20 3. Project Targets and Achievements 21 4. Vehicles and Equipment Procured 22 5. Training Courses and Study Tours for Personnel of the Sindh Forest Department and Sindh Farmers 23 6. Detailed Project Cost 28
7. ADB Annual Disbursement of Loan Proceeds 29 8. Implementation Schedule 30 9. Organizational Chart of the Sindh Forest Department at Provincial Level 32 10. Status of Compliance with Loan Covenants 33 11. Status of Consultant Recruitment 40 12. Technical Assistance Completion Report 41 13. Economic Reevaluation 43 14. Projected Harvests, Costs, and Income from the Sindh Forest Department’s Plantations Covered by the 14 Management Plans 54 15. Follow-Up Actions and Recommendations 55
BASIC DATA
A. Loan Identification
1. Country Pakistan 2. Loan Number 1076 3. Project Title Sindh Forestry Development Project 4. Borrower Islamic Republic of Pakistan 5. Executing Agency Sindh Forest Department 6. Amount of Loan SDR 16.309 milliona 7. Project Completion Report Number PCR:PAK 739
B. Loan Data 1. Appraisal – Date Started 11 September 1990 – Date Completed 26 September 1990
2. Loan Negotiations – Date Started 19 November 1990 – Date Completed 20 November 1990
3. Date of Board Approval 24 January 1991
4. Date of Loan Agreement 02 April 1991
5. Date of Loan Effectiveness – In Loan Agreement 1 July 1991 – Actual 27 December 1991 – Number of Extensions 3
6. Closing Date – In Loan Agreement 30 June 1999 – Actual 31 January 2002 – Number of Extensions 2
7. Terms of Loan – Interest Rate 1% – Maturity (number of years) 35 years – Grace Period (number of years) 10 years
8. Terms of Relending – Interest Rate 6% – Maturity (number of years) 25 years – Grace Period (number of years) 10 years – Second-Step Borrower Agricultural Development Bank of Pakistan
a Original amount approved was SDR 28.755 million. iv
9. Disbursements
a. Dates Initial Disbursement Final Disbursement Time Interval 2 April 1992 31 January 2002 9 years, 9 months
Effective Date Original Closing Time Interval Date 27 December 1991 30 June 1999 7 years, 6 months
b. Amount (SDR‘000)
Net Undisbursed Category Original Last Revised Amount Balance Canceled Allocation Allocation Disbursed at Closing Date 01A CW – Plantations 12,401,000 9,067,133 8,768,664 298,469 01B CW – Project & 370,000 669,300 670,226 (926) Institutional Support 02 Equipment and Materials 609,000 859,850 827,950 31,900 03 Training and Study 325,000 331,320 292,493 38,827 04A Establishment and 1,959,000 2,155,000 2,163,264 (8,264) Maintenance – Social Forestry 04B Establishment and 5,186,000 2,311,350 1,888,096 423,254 Maintenance - Plantations 04C Establishment and 180,000 72,000 19,098 52,902 Maintenance – Project and Institutional Support 05 Consulting Services 1,361,000 1,051,100 1,025,352 25,748 06 ADBP Credit 1,598,000 0 0 0 08 Service Charge 776,000 776,000 656,536 119,464 09 Unallocated 3,990,000 0 0 0 99 Imprest Fund 0 0 (2,028) 2,028
28,755,000 17,293,053 16,309,651 983,402
ADBP = Agricultural Development Bank of Pakistan; CW = Civil Works.
10. Local Costs (ADB-Financed) - Amount ($’000) $9,350 - Percentage of Local Costs 74% - Percentage of Total Cost 36%
v
C. Project Data
1. Project Cost ($’000)
Cost Appraisal Estimate Actual
Foreign Exchange Cost 23,367 13,415 Local Currency Cost 28,633 12,774
Total 52,000 26,189
2. Financing Plan ($’000) Appraisal Estimate Actual Cost Foreign Local Total Foreign Local Total Implementation Costs: ADB-Financed 23,367 18,233 41,600 13,415 9,350 22,765 Borrower-Financed - 9,200 9,200 0 3,424 3,424 Private Sector - 1,200 1,200 0 0 0 Total 23,367 28,633 52,000 13,415 12,774 26,189
ADB = Asian Development Bank.
3. Cost Breakdown by Project Component ($‘000) Appraisal Estimate Actual Component Foreign Local Total Foreign Local Total 1. Social Forestry Community Forests 232 2,091 2,323 564 2,257 2,821 Shelterbelt 25 229 254 59 249 308 Hurries 13 120 133 33 121 154 Subtotal 270 2,440 2,710 656 2,627 3,283
2. Forest Plantations Riverine Forests 5,599 6,593 12,192 4,221 2,646 6,867 Inland Forests (New) 5,561 5,551 11,112 4,126 2,655 6,781 Inland Forests (Rehabilitation) 1,410 2,411 3,821 1,032 1,130 2,162 Subtotal 12,570 14,555 27,125 9,379 6,431 15,810
3. Institutional Support 2,133 2,577 4,710 2,491 3,716 6,207
4. Private Sector (Pilot) Credit Component 1,500 1,500 3,000 0 0 0
Total Base Cost 16,473 21,072 37,545 12,526 12,774 25,300
5. Contingencies Physical 1,647 2,107 3,754 0 0 0 Price 4,125 5,454 9,579 0 0 0 6. Service Charge 1,122 0 1,122 889 0 889 Total Project Cost 23,367 28,633 52,000 13,415 12,774 26,189
vi
4. Project Schedule
Item Appraisal Estimate Actual
Date of Contract with Consultants
International Consultants: Implementation Adviser July 1992 February 1993 Forestry Specialist September 1992 December 1992 Tree Improvement/Silviculturist January 1993 March 1994
Domestic Consultants: Civil Engineering January 1992 July 1993 Irrigation Advisor July 1992 August 1995 Rural Sociologist September 1992 July 1993 Forest Management Specialist - October 1999 Forest Economist - November 1999 Topograhic Survey Mapping January 1992 May 1993
Civil Works Contract
Date of Award January 1992 April 1992 Completion of Work July 1992 December 1993
Equipment and Supplies
Dates First Procurement May 1992 June 1992 Last Procurement June 1998 June 2001
Other Milestones Approval of the First Extension of Loan Closing Date 17 June 1999 First Partial Cancellation 23 February 1997 Second Partial Cancellation 21 August 1998 Third and Final Cancellation 31 January 2002
5. Project Performance Report Ratings Ratings Development Implementation Implementation Period Objectives Progress From 1 January to 31 December 1992 Satisfactory Satisfactory From 1 January to 31 December 1993 Satisfactory Satisfactory From 1 January to 31 December 1994 Satisfactory Satisfactory From 1 January to 31 December 1995 Satisfactory Satisfactory From 1 January to 31 December 1996 Satisfactory Satisfactory From 1 January to 31 December 1997 Satisfactory Satisfactory From 1 January to 31 December 1998 Satisfactory Satisfactory From 1 January to 31 December 1999 Satisfactory Satisfactory From 1 January to 31 December 2000 Satisfactory Satisfactory From 1 January to 31 December 2001 Satisfactory Satisfactory
vii
D. Data on Asian Development Bank Missions No. of No. of Specialization Name of Mission Date Persons Person-Days of Membersa Loan Fact Finding 14 November-3 December 1989 5 85 a, b, j, k,l, Appraisal Mission 11-26 September 1990 8 96 a,b,d,l,m,n,o,p Inception Mission 11-27 February 1992 3 17 a b, c Special Project Administration 18 June 1992 1 1 b Review Mission 1 17-30 November 1992 3 30 a, b, d Review Mission 2 7-15 September 1993 2 18 b,c Review Mission 3 16-18 May 1994 2 6 b, d Special Project Administration 1-4 August 1994 1 4 b Review Mission 4 4-13 March 1996 2 20 e, f Midterm Review 21 September – 10 October 1996 1 10 e Special Project Administration 1–10 December 1996 3 25 e,f, g Review Mission 5 9-14 July 1997 1 6 e Special Project Administration 19-21 January 1998 2 6 b, c Review Mission 6 25 February to 4 March 1999 1 8 h Review Mission 7 6-11 September 1999 2 12 c, I Review Mission 8 5-10 June 2000 1 6 I Review Mission 9 12-13 March 2001 1 2 I Project Completion Reviewb 22 January-6 February 2003 2 32 m, j
a a=Sr. Financial Analyst, b=Forestry Specialist, c=Assistant Project Analyst, d=Young Professional, e=Sr. Forestry Specialist, f=PRM Accounts Assistant, g=Social Forestry and Plantation Management/Staff Consultant, h=Sr. Environmental Specialist, i=Project Specialist (Natural Resources), j=Forest Economist/Staff Consultant, k=Hydrologist/Staff Consultant, l=Project Engineer (Irrigation), m=Project Economist, n=Programs Officer , o=Counsel, p=Mission Secretary. b The project completion report was prepared by Mr. Ahsan Tayyab, Project Economist.
ix
I. PROJECT DESCRIPTION
A. Background and Rationale
1. The Pakistan provinces with the lowest per capita forestland are Punjab (0.01 hectare [ha]) and Sindh (0.03 ha). The main productive forests in Sindh are under Government control. They are the riverine forests and the inland (irrigated) plantations, with a combined area of 320,000 ha— about 2.3% of the province’s total land area except for 835,000 ha of mangrove forests and rangelands. The riverine forests extend along both banks of the Indus River; their natural regeneration largely depends on the river’s annual inundation. The frequency of inundation has decreased considerably over time, causing large-scale drying. The inland plantations extend outside the river embankments and are generally low-productive lands that are not fit for agriculture. But with salt-tolerant tree species, those marginal lands have potential for highly productive fuelwood plantations.
2. The Government’s Seventh Five-Year Plan (FY1988–1989 to FY1992–1993) clearly recognized the extreme inadequacy of Pakistan’s forest cover, and emphasized the need for programs to support plantations for fuelwood production and farm forestry on marginal private lands. The Plan also outlined the need to develop a comprehensive long-term master plan for forestry and range management.1 Thus, the Sindh Forest Department (SFD) developed the Sindh Forestry Development Plan. Its two main strategies were (i) to maximize production within Government-managed forests through intensive management, to plant trees on denuded areas in riverine and inland forests, and to improve mangroves and rangelands; and (ii) to promote social forestry to increase wood production through massive plantations on private lands. To support the Sindh Forestry Development Plan, the Government requested assistance in the forestry sector from the Asian Development Bank (ADB). After an extended preparatory phase, ADB approved the Sindh Forestry Development Project on 24 January 1991.
B. Objectives and Scope
3. The Project’s main objectives were (i) to increase Sindh’s forest resources to partly meet its shortage of fuelwood and timber, and (ii) to improve environmental quality through afforestation. The Project planned to involve both the public and the private sectors to achieve those objectives.
4. Appendix 1 gives a detailed description of the main project components. A brief description follows:
(i) Social Forestry: This component would assist farmers by establishing 12,000 ha of private farm woodlots and tree plantations in shelterbelt2 areas on eroding embankments and along waterways. The three main activities envisaged were community forestry, shelterbelt planting, and establishing private woodlots or “hurries.”3 (ii) Rehabilitation of Government Reserved Forests: This component would rehabilitate 21,000 ha of selected Government reserved forests that have been seriously degraded because of water shortage and lack of silvicultural treatment. Extensive rehabilitation and reforestation in selected riverine and inland forests was envisaged. The riverine
1 The Pakistan Forest Sector Master Plan was prepared under TA No. 1170-PAK, approved for $1.25 million on 22 June 1989. The United Nations Development Programme and the governments of Germany, Netherlands, and Switzerland also contributed to the Plan, which was completed on 10 February 1993. 2 Single or multiple rows of trees planted along the farm boundaries. 3 “Hurries” are private tree plantations, from 1 to 4 ha each, of Acacia nilotica (locally called babul). The hurry system was formalized in 1858 by Sir Bartley Frere, Sindh commissioner, to meet local fuelwood and minor timber requirements. Hurry growth on private farms in Sindh began in 1859. 2
forests comprise 7,000 ha, that were identified for development into well-managed forest plantations. The selected inland forest plantations cover 14,000 ha; the program would reestablish 8,000 ha, and rehabilitate 6,000 ha. (iii) Institutional Support: The institutional capabilities of SFD would be strengthened by providing staff training, research facilities, and consultant services. Provisions were made for a modest increase in SFD’s administrative and field staff, consultant services, and training and research facilities to strengthen field studies on which tree species to plant. (iv) Private Sector Credit Component: Credit would be provided on a pilot basis for the private sector to participate in the development of about 3,000 ha of selected Government reserved forests in combination with the production of agricultural crops or industrial wood, or both.
5. An advisory technical assistance (TA) was also approved to provide institutional strengthening and support to SFD during implementation.4
II. EVALUATION OF DESIGN AND IMPLEMENTATION
A. Relevance of Design and Formulation
6. Although the Project was approved prior to the completion of the Forestry Sector Master Plan (FSMP), the Project Completion Review Mission finds the project design and formulation consistent with the FSMP which on completion emphasized the need to increase wood production by establishing new plantations, rehabilitating existing and degraded forests, and plantation and farmland plantings. As part of the strategy to accomplish specific FSMP objectives, the Project served as an instrument for its implementation. Appendix 2 shows targets of the Sindh FSMP and accomplishments to date, including through this Project.
7. The project’s design and formulation were consistent with ADB’s Sector Paper on Forestry of July 1989. The Sector Paper highlighted the growing importance of forestry in the region, and emphasized replenishment of the resource base by activities such as supporting industrial forest plantations and forest industries, environmental forestry, and the strengthening of forestry institutions. Similarly, the Project’s immediate objective was in conformity with the sector approach and called for the need to produce vitally needed wood for Sindh, and to improve environmental quality. The design and formulation also provided the necessary supporting system to strengthen SFD through training of key staff, and providing buildings, vehicles, equipment, and consultancies.
8. Project formulation. The Project was prepared over an extended period, because of issues in quality and acceptability. The first team of consultants for project preparation was fielded from July to September 1987. That team submitted its report, which proposed an agroforestry approach, in March 1988. A second team of consultants found the agroforestry approach technically infeasible in its report, submitted in September 1988. The first team’s proposed design was changed to accommodate the straightforward afforestation of forest reserves. Because of the heavy investments required for land preparation and establishing irrigation systems, the economic internal rate of return (EIRR) was about 11%, and was considered lower than acceptable. Therefore, a social forestry component was also included in the Project during appraisal in September 1990. Besides its contribution to enhancement of potential benefits, the social forestry component was considered an appropriate and cost-effective strategy for forest management and project implementation. The Project was approved on 24 January 1991, and the loan was declared
4 ADB. TA1468-PAK: Technical Assistance to Pakistan for Institutional Strengthening of Sindh Forest Department, for $560,000, approved on 24 January 1991. A TA Completion Report is in Appendix 12. 3 effective on 27 December 1991. Although the Project also intended to target the poor through greater availability of fuelwood and employment generation, its social forestry components appears to favor participants with land holdings. Also, in consonance with the approach taken in other projects in the early 1990s, the Project used an engineering approach in selecting subproject sites in riverine and inland forests, and SFD staff focused primarily on fulfillment of physical targets— thus excluding participation of the communities and, particularly, the landless poor.
9. Soundness of Project design and relevance of changes during implementation. The 1996 midterm review (MTR) gave an opportunity to incorporate revisions based on experiences in the first 4 years of project implementation, and on FSMP findings. The review resulted in the cancellation of the private sector credit component, and revisions of targets in social forestry and irrigated plantations. Social forestry was expanded from 12,120 ha to 18,600 ha to cover all of Sindh Province, while the target in the riverine forests was scaled down from 7,000 ha to 3,000 ha because of operational constraints such as availability of bulldozers and tractors, and the capacity of contractors. Appendix 3 shows targets of the different components at appraisal, and as revised during the MTR.
10. The cancellation of the private sector credit component became inevitable because the province banned the leasing of Government lands in 1994. There was no indication that the ban would be lifted within the Project’s life span, so there was no choice but to cancel the component.
11. The expansion of the social forestry component to cover the entire province was a welcome change in project implementation. It brought broader participation of local communities and enhanced the capacity of the forestry sector to meet shortfalls in wood supply by bringing more areas into forest production. It provided SFD an alternative strategy for increasing forest production and improving environmental quality. But more important, the expansion added a dimension to Project implementation by making social forestry practically a sector project. This provided the entire department a good training ground in forestry project implementation.
12. At completion, the Project is still relevant in light of the forestry sector’s strategy for development of forestry resources as embodied in the FSMP. Wood production to meet the increasing local demand still remains an important issue in the forestry sector. While the Project provided increased employment for the poor, it did not directly address poverty reduction. Thus, its impact on poverty reduction has remained limited.
B. Project Outputs
13. Appendix 3 shows the targets, as indicated at appraisal and later revised in the MTR and loan extension, and the actual accomplishments at Project completion on 30 June 2001. Almost all targets were met and in some cases, even exceeded.
14. Social forestry. All social forestry targets were achieved. At appraisal, social forestry was planned for five districts, but it was expanded to cover the entire province after the MTR. A total of 18,600 ha of forest plantations was developed; 16,000 ha for community forestry; 1,600 ha for shelter belts, and 1,000 ha for private woodlots or hurries. Social forestry also trained 800 farmers in the raising of nurseries and care of post plantations.
15. Social forestry activities were initiated in 1993, and all targets were accomplished by 1998– 1999. Implementation was smooth, and in line with what was envisioned at appraisal. This was mainly because of the long-cherished Sindh tradition of growing trees on farmland, the minimal work required to prepare plantation sites, and the dedication of the Project and social forestry officials. Most of the farmlands had existing irrigation systems. Although implementation was in
4
accordance with the specifications set at appraisal, the status of these areas was not monitored, according to the 1998 timber inventory study and the 2000 benefit monitoring study. Key SFD officers say that any move to monitor these areas could turn off interest because participants would interpret it as too intrusive to their internal affairs and thus, defeat the purpose of social forestry. Because of the lack of monitoring, it is not known how much of the areas developed through this component are still maintained as tree plantations. The PCR mission’s discussions with SFD staff who are knowledgeable about conditions in the area indicate that 80―90% of the older plantation areas have already been cut or harvested because of drought or the lack of a viable market for eucalyptus, or both.
16. To help ensure the success of social forestry, participants were provided some incentives in addition to technical advice. For shelterbelt planting, PRs5,000 per kilometer (km) or PRs12,500 per ha were given to support the establishment and maintenance of plantations.5 For hurries, the Project provided PRs2,500 per ha.6 For community forestry, seedlings were provided at a subsidized rate. Actual cost was about PRs2 per seedling, but participants got them for PRs0.25. This subsidized rate was withdrawn in January 2000—but by then, the social forestry targets had already been accomplished. The incentives provided to participants may partly explain why the component started on time, and targets were achieved at the original loan closing date. On this basis, the incentives served their purpose well. But overall, social forestry participants were mostly landowners, so benefits did not accrue to the poor, the usual target beneficiaries in social forestry programs.
17. Irrigated plantations. For inland reserved forests, 12,000 ha of irrigated plantation were planted, and 7,000 ha were rehabilitated; in riverine forest reserves, 3,149 ha of irrigated plantation were planted. Although the Project started in 1991–1992, actual planting began only in 1995–1996. The delay was caused by the law and order situation in the initial stages, inadequate institutional expertise in operational aspects of implementation and the technical complexity of irrigated plantations. The delay in plantation development delayed the Project completion date from 1999 to 2001. The delay also set back the stream of project benefits by at least 2 years, and adversely affected the Project’s economic viability.
18. As part of the Project management’s monitoring, the “success rate,” which is based on visual inspection of the density or crown cover of an area, is used to determine if it should be replanted. Project data show that 34% of the area planted had a success rate of 10% or lower, 10% had a success rate of 11–30%; 13% had 31–60%, and 42% had 61–100%. The Project management considers success (or areas that do not need replanting) in plantation development as those areas with a success rate higher than 30%. This now constitutes about 56% of the area planted. Thus, by definition, the success rate is now 56%. On the other hand, 44% of the areas planted may be considered failures. SFD, using its own resources, is taking steps to replant some of the “failed” areas. Reestablishment activities are now in various stages: water courses are being cleaned, and land is being plowed, leveled, and planted. 19. Failures in plantation establishment may be attributed to soil salinity, improper land preparation, and drought over the last 3 to 4 years. But these failures could have been minimized by improving the selection process of sites to be included, and enforcing tighter quality control on land preparation by contractors.
20. Private sector credit component. Initial work on the private sector credit component was carried out with the support of a private sector consultant recruited through the advisory technical assistance. Of the 36 entrepreneurs who indicated interest in forest plantations, 19 were shortlisted
5 The amount fully covered the estimated cost of establishment and maintenance of the shelterbed plantings. 6 This amount covered 30–40% of the cost of establishment and maintenance of hurries. 5 to submit feasibility reports on the prospective sites, and 16 potential sites were identified. Experience during implementation highlighted that private sector involvement in developing reserved forests would require a policy that allows the utilization of Government-owned land. To facilitate the process, ADB also provided details on forest land management agreements in place in other countries. The key concept of the forest land management agreements was to promote partnership between Government and private entrepreneurs to improve use of otherwise idle forestland. But the Sindh government was reluctant to enter into partnership with the private sector because of the high incidence of encroachments on permanent forests after the earlier approval of temporary leases. In 1994, the leasing of Government lands was banned, and no progress could be made to move the private sector component ahead. The private sector component was canceled in 1996, as recommended in the MTR.
21. Project and institutional support. All targets for project and institutional support were achieved satisfactorily. The buildings, vehicles, and equipment were procured with no serious problems (Appendix 4). Professional training was provided, locally and abroad, for 131 forest department personnel, 973 farmers were trained in nursery raising and tree planting (Appendix 5).
22. Modern, permanent nurseries have been established, for the first time in Sindh, in five districts. These nurseries not only produce quality seedlings, but also serve for extension, training, and research.
23. A Geographic Information System (GIS) laboratory, established in Hyderabad, provides state-of-the-art technology. It has the potential to meaningfully contribute to better SFD planning and decision making. But the laboratory is not being used because of lack of budget, and of a full- time professional to supervise its operation.
24. Forest management plans for 14 divisions have been prepared covering the period of 2001–2002 to 2010–2011. This is a large step toward the sustainable management of Sindh’s plantation forests. But current budget allocations are inadequate to fully implement the plans. In a meeting with the Planning and Development Department of the Government of Sindh on 3 February 2003, it was agreed that a steering committee, headed by a secretary, will be established to facilitate approval of the plans and oversee follow-up actions necessary for the sustainability of forest plantations.
C. Project Costs
25. The estimated project cost at appraisal was $52.00 million equivalent, including physical and price contingencies, taxes, and duties. The loan was for $41.60 million equivalent; the Government was to provide another $9.2 million and the private sector, $1.20 million. The actual project cost was $26.19 million (Appendix 6). Reasons for the cost reduction of $25.80 million were: (i) of the total loan of $41.60 million, $14.00 million equivalent was canceled after the 1996 MTR, mainly because the Pakistan rupee devalued 64% against the US dollar, and the US dollar devalued against the Special Drawing Rights (SDR); (ii) the private sector component was eliminated, and targets for riverine forests were reduced from 7,000 ha to 3,000 ha; (iii) for forest plantations, the actual cost of $15.81 million was lower than the estimated $27.13 million at appraisal, mainly because targets for riverine forests were lowered, while actual social forestry costs of $3.28 million were higher than the appraisal estimate of $2.71 million because targets were increased from 12,120 ha to 18,600 ha; and (iv) the actual cost of $6.21 million for institutional support was higher than the minimal appraisal estimate of $4.71.
6
D. Disbursements
26. A total of $22.77 million was disbursed through the loan. After reconciliation and closure of the project account, the unused advance of $205,980 in the special account was refunded to ADB on 1 January 2002. The loan account was closed on 31 January 2002. Appendix 7 shows how loan proceeds were used in the different categories. The establishment of an imprest account facilitated project implementation.
E. Project Schedule
27. The Project was to be implemented over 7 years, from 1991 to 1998 (Appendix 8). Although the loan was approved in January 1991, and was declared effective in December 1991, implementation could only begin in June 1992. Appointment of key staff for the Project Management Organization (PMO) took much longer than anticipated and thus, affected recruitment of consultants and hiring of consulting firms for topographical survey and mapping. Problems with law and order, and inadequate institutional expertise in operational and technical aspects of site selection and contracting, led to delays in the establishment of new plantations in the riverine and inland areas. Also, the contractors had limited capacities to undertake certain types of work in land development and establishment of irrigated plantations, so several identified plantation sites could not be developed on schedule. No concrete progress was possible in implementing the private sector component, so the 1996 MTR recommended its cancellation. In 1999, to accomplish the remaining targets and provide time for care and maintenance of newly established plantations, the loan closing date was extended to 30 June 2001. The extended period allowed SFD to complete all targets established at appraisal, and revised through the MTR.
F. Implementation Arrangements
28. Appendix 9 shows the project organizational chart. The implementation arrangements were essentially the same as specified in the appraisal report. The PMO, headed by a project director (a senior SFD officer with the rank of forest conservator) was set up within SFD to coordinate overall project implementation. An interministerial steering committee, chaired by the secretary of forests, was also established.
29. Initial plans were for field activities to be implemented through the Conservator of the Afforestation Circle, Hyderabad and Sukkur and through the Conservator of Social Forestry. But after the MTR, social forestry was expanded to cover all of Sindh. The entire SFD was involved, with a positive impact on project implementation. Scaling up of project activities gave all departmental staff opportunities to be associated with the development activities, and helped enhance ownership within SFD. At project completion, an institutional project ownership was evident, which greatly helped accomplish project targets.
G. Conditions and Covenants
30. Most loan agreement covenants were complied with (Appendix 10). A case of noncompliance was in the covenant through which the Sindh government was to establish a self- financing system (SFS) for SDF. At least 50% of the annual revenues generated from the Government’s reserved forests were to go into this fund, to be used for annual operation and maintenance of those forests. But despite ADB follow ups, the SFS has not been established. A possible factor for delay of this covenant has been a view within SFD that the case for establishing this mechanism could be more convincing after revenues begin from Project-established plantations. The Project Completion Review mission pointed out that further delays in the setting up of SFS would have adverse implications on sustaining project investments in plantation 7 development. In the 3 February 2003 wrap-up meeting, it was agreed that SFD and the Planning and Development Department would prepare a summary for the Finance Department’s priority consideration so that steps could be taken to immediately establish the SFS, thereby ensuring its implementation from FY2003 to FY2004.
H. Consultant Recruitment and Procurement
31. The procurement of goods, civil works, and services were in accordance with ADB’s Guidelines for Procurement and Guidelines on the Use of Consultants, and Government procedures that were acceptable to ADB. The SFD procured vehicles with no significant problems (Appendix 4). The only major problem was in the selection of contractors for plantation development. SFD’s initial selection process did not consider the contractors’ past experience for carrying out works of this scale, so several contracts had to be terminated. But the selection criteria were then revised, and subsequent contractors were qualified to handle the required tasks of the scale required. Appendix 11 summarizes the contracts awarded. Forty-five person-months of international consulting were allocated, but 51 person-months were used, including 6 person- months for the extension specialist, 3 person-months for the tree improvement specialist, and 42 person-months for project implementation advisers (Appendix 11). Another 176 person-months of local consulting services were allocated; 151 were used. This included 91 person-months of civil engineering consultancies, with the remaining person-months allocated to special irrigation adviser (33), rural sociologist (6), project benefit monitoring and evaluation (4), project economist (6), and forest management specialist (12).
32. Related technical assistance. The advisory TA provided $560,000, or 63 person-months, of consulting services (21 international, and 42 local, person-months). Services were in forest inventory systems and procedures; private sector participation; institutional strengthening; planning, monitoring, and evaluation; economic evaluation of riverine forests; control systems for budgeting and accounting; benchmark surveys; and social analysis for 12 Sindh districts.
33. The forest inventory assessed the status of plantations developed through the Project in irrigated plantations and social forestry. Despite heavy time constraints, the study provided information on tree diameter at breast height in social forestry plantations, but could not assess the stocking in irrigated plantations because, at that time, the plantations were immature to make an assessment of timber production. The project monitoring and evaluation was comprehensive. It identified significant information that was needed for periodic monitoring. The evaluation procedure for riverine forest subprojects was also useful in project site selection. The PMO also appreciated the budgeting and accounting control, and the institutional analysis. Finally, the benchmark surveys and social analyses gave valuable information for the planning of future projects. Those reports helped greatly in the preparation of management plans for the 14 forestry divisions.
34. The services recruited through the technical assistance helped enhance the skills and exposure of SFD staff in project management and implementation. Overall, the TA services were consistent with the terms of reference. The TA is rated, in the TA Completion Report, as successful (Appendix 12).
I. Performance of Consultants, Contractors, and Suppliers
35. The international consultants provided valuable support in expediting implementation, with one major exception. The project implementation adviser, recruited in 1993, performed poorly, and had to be replaced. His successor, hired in late 1994, provided valuable inputs in project
8 implementation. ADB and SFD appreciated his services. The local consultants also performed satisfactorily.
36. Private contractors for land development and plantation development, and suppliers of goods and services, fulfilled their obligations to the satisfaction of the PMO and the SFD. But several contractors performed below expectation during early project implementation. Most of the contractors had no work experience in plantation development. As SFD staff gained operational and technical experience in large-scale plantation development, the selection criteria for contractors were revised, and the level of contract supervision was enhanced. Contractors’ performance improved visibly in the latter part of the Project; the 1997 to 1999 targets accounted for 66% of the new plantations established.
J. Performance of the Borrower and the Executing Agency
37. The Borrower generally provided the Project adequate local funds on an annual basis. When appraising the performance of the Executing Agency, SFD, one should consider that this was the first large-scale project it had implemented. Initial problems and subsequent delays occurred because of SFD and the contractors’ lack of experience, and the law and order situation. But SFD continued to prioritize the Project through regular steering committee meetings. This resulted in institutional ownership and subsequent extension of the Project to all forest divisions. This gave an environment for better coordination and smooth implementation despite adverse conditions at project sites. SFD also formulated integrated forest management plans for all forest divisions. Since project completion, SFD has maintained the Project Management Office to ensure timely follow-up and adequate closure of activities. The only exception was the delay in institutionalizing monitoring and evaluation processes introduced through the Project. Overall, SFD supported the Project adequately, and has continued its commitment to sustaining Project investments. SFD’s overall performance is rated satisfactory.
K. Performance of ADB
38. ADB fielded 11 review missions, including the MTR and PCR, during project implementation. These missions provided opportunities for both SFD and ADB to assess progress, and identify actions to overcome problems. Through the missions, ADB helped revise project targets to conform to prevailing conditions, and experiences gained. ADB missions also helped assess the economic viability of a possible loan extension. ADB also helped determine the extent and quality of nonproject plantations, which resulted in the preparation of integrated plans for the sustainable management of Sindh’s plantations. Because of problems associated with the marketing of eucalyptus, visiting missions also encouraged SFD to develop linkages with other initiatives in the region.7
39. ADB could have done more to sensitize SFD on the need to increase its focus on participatory processes. Community participation and inclusion of the poor and marginalized communities in project-supported activities were not explicitly addressed during the missions. In hindsight this could have been part of a policy dialogue on SFD institutional reforms. ADB’s overall performance is rated satisfactory.
7 One such suggestion was to explore alternative value-added products for eucalyptus, including looking at Swedish- supported saw mills that handle timber of small to medium diameter which is use to produce chopping boards, furniture wood, and parque flooring. Use of these saw mills is emerging as a successful venture in the Lao People’s Democratic Republic. 9
III. EVALUATION OF PERFORMANCE
A. Relevance
40. Overall, the Project may be rated as relevant. At the time of formulation, the Project was consistent with ADB’s Sector Paper on Forestry and was also in line with FSMP’s strategy of increasing wood production and environmental protection. The design focused on the development of plantations using the reserved forestlands under SFD and private lands of project participants. As implementation progressed, stakeholders realized the need to incorporate changes in the project. Thus, revisions were made in the 1996 review. Notable among the revisions were the cancellation of the private sector component, the expansion of social forestry to cover the entire province, and revised targets in the irrigated plantations. The cancellation of the private sector component allowed the Project to focus more on the development of its own plantations in the inland reserves, and to further increase the targets of community forestry plantations. The change brought more involvement of the local people in the campaign for increased forest production and, to a lesser extent, improvement of the economic conditions of project participants.
41. Likewise, in the process of negotiation for the extension of the loan termination, ADB made funds available for the formulation of management plans for managing plantations and social forestry of the province. This resulted in the preparation of management plans for all the 14 forestry divisions of the province. This move may be considered as a significant project contribution toward the institutionalization of sustainable forest management in the province, as it covers both the Project and nonproject areas.
B. Efficacy in Achievement of Purpose
42. Appendix 3 summarizes project achievements relative to targets. Quantitative targets for social forestry, irrigated plantations, and institutional support were either reached or exceeded, except for seedling distribution. Seedling production was sufficient, but demand was low—perhaps because the subsidy for seedlings was withdrawn in January 2000.
43. Accomplishment of the quantitative targets led to the accomplishment of the immediate objective of increasing forest cover and raising the volume of wood production. Additional areas placed under tree cover in both riverine and inland regions are about 8,400 ha of new plantations, 7,000 ha of rehabilitated inland plantations, and 5,800 ha in social forestry. These plantations are expected to produce about 7 million cubic meters (m3) of wood during the Project’s economic life. Overall, the Project is considered efficacious in its achieving its purpose.
C. Efficiency in Achievement of Outputs and Purpose
44. The Project does not meet the efficiency criteria. Economic analysis was carried out using the same methodology used at appraisal. The base EIRR has been estimated as 9% (Appendix 13). The estimated EIRR at the time of appraisal was 20%. Analysis indicates that the significant reduction in the Project EIRR is mainly because of (i) over-optimistic estimates of the yield of acacia (25 m3/ha per year at appraisal versus 11 m3/ha per year at completion), (ii) optimistic estimates of yields of eucalyptus (18 meters (m)/ha per year at appraisal versus 15 at completion), and (iii) anticipation that industrial wood would be produced.8 Other factors that may have reduced
8 At appraisal, the average stumpage prices (in terms of 2000 prices) were PRs927/cu m for acacia, and PRs442 for eucalyptus. At project completion, economic stumpage prices were PRs569/cu m for acacia and PRs339 for eucalyptus.
10
the EIRR are the delay9 in the stream of benefits by at least 2 years, and failure of plantations (43% in riverine and 45% in inland) due to drought, saline soils, improper land preparation, and a lack of marketing opportunities for eucalyptus. Drought over the past 3 to 4 years is widely perceived to have contributed significantly to yield reductions and plantation failures.
D. Preliminary Assessment of Sustainability
45. The sustainability of management of the irrigated plantations will depend on (i) the existence of a viable integrated management plan, with Government support and adequate funding for its implementation; (ii) a unified and responsive SFD; (iii) an adequate water supply; (iv) the increased awareness of local communities and governments, nongovernment organizations (NGOs), and Government officials; and (v) the profitability of the irrigated plantations.
46. The SFD has taken a significant step toward sustainable management of its plantations by putting management plans in place for 14 divisions. These plans will guide activities or interventions to achieve the goals and objectives of plantation management. But approval of these plans is pending. The steering committee should take urgent steps to have the plans approved officially, which will help in obtaining funds for implementation.
47. A review of the management plans for the 14 forestry divisions indicates that over the 10- year planning horizon, a total of PRs1,737.2 million will be required, or an average annual budget of PRs173.7 million (Appendix 14). Similarly, a total of 5.0 million m3 must be harvested over the 10-year period, an average annual harvest of 0.5 million m3. At constant 2000 prices, this is valued at PRs1,946.1 million, or an annual revenue of PRs194.6 million. If projections of these plans are realized, SFD will have a net average annual income of about PRs20 million. Establishment of the SFS is required to facilitate the plowing back of these revenues to sustain the plantations. Without the SFS, the only option would be to meet maintenance costs through budgetary allocations. Such funds are currently insufficient, and will probably decline in real terms over the duration of the management plans.
48. Success of the plantations will depend heavily on the water supply, including water from existing irrigation canals, supplemented by tube wells. If drought causes serious water shortages, it is likely that water will be prioritized for agriculture crops. Community awareness is also critical to the sustained management of forest resources. Partnerships with communities and other stakeholders must be strengthened to improve public awareness of the need to sustain forest resources, and the resulting benefits. Sustainability is rated less likely at this stage, considering the lack of an operational self-financing system, the uncertainty of water supply, and the lack of formal arrangements for engaging local communities. However, improvement is warranted if recommendations in Appendix 15 are adequately followed.
E. Institutional Development and Other Impacts
49. Besides achieving the immediate objective of increasing wood supply and increasing the forest cover in Sindh, the Project has made a significant impact in the institutional development of SFD. The Project has also had a positive environmental impact. But the sociocultural impact has been limited; overall performance in this area is rated as moderate.
50. During implementation, the Project was extended to all forest divisions and promoted farm forestry on a province-wide basis. Through this change, the Project had a significant impact on the
9 The sensitivity analysis conducted during appraisal indicated that a 2-year delay of project benefits would reduce the economic internal rate of return (EIRR) from 20% to 15%. 11 institutional development of SFD. It has made available to SFD not only training but also additional infrastructure, vehicles, equipment, research facilities, and consultancy services. Preparation of management plans for the 14 divisions also allowed SFD to place Sindh’s riverine and irrigated plantations under sustainable management.
51. The level of environmental awareness of farmers and other stakeholders has increased, thereby enhancing SFD’s efforts to protect and manage its plantations. Some educational institutions that offer courses in agriculture and social forestry are now using the guidelines on social forestry prepared through the Project. Some areas that were formerly nonproductive because of soil conditions have been brought back to productive use as a result of establishing forest plantations. Some farmers have established plantations not only to produce wood but also to reduce soil salinity and enable them to use their land for agricultural production after harvest of the plantations.
52. The productivity of farmlands of farmers who participated in the Project’s social forestry component is perceived to have increased. This remains to be confirmed,10 but some forest officers in the area believe that productivity has increased by as much as 10% because of shelterbelts that protect crops from strong winds and severe temperature. It has also been observed that the system of hurries or private woodlots has the potential to significantly improve soil fertility because of the nitrogen-fixing ability of Acacia nilotica, the tree species planted in hurries. Keerio, Ehrenreich, and Mahler (1993)11 reported that wheat yields could increase as much as 20% after one hurry rotation.
53. The impact on poverty reduction will be mainly through Project-generated employment, including for establishing nurseries and harvesting. The Project, during implementation, provided an estimate employment equivalent of 12,632 person-years, or 1,263 full-time jobs. For the remaining Project life, it is expected to generate the equivalent of 74,691 person-years, or the equivalent of employing 4,150 persons full time.
54. Energy impact. The Project will produce an estimated 7.13 million m3 of wood over its economic life. Cleaning, weeding, and pruning operations will yield another 0.90 million m3 that will be locally available for fuelwood. Assuming that 50% of the stumpage sales will be used as fuelwood, 4.47 million m3 of fuelwood will be used. This is about 2.4611 million tons of air-dried fuelwood. That is equivalent to 0.4312 million tons, or 3.31 million barrels, of kerosene. This volume is approximately 0.53413 million m3 or 534 million liters of kerosene.
55. Women’s participation in Project activities has remained limited, particularly in plantations that SFD developed directly. In social forestry there are examples in Karachi, Thatta, and a few other locations where women have managed nurseries, providing seedlings of eucalyptus and other species. This has become an important supplement to household income for such families. Although the Project has supported the employment of women in some locations, gender disaggregated data is not available to assess the scale and extent.
10 The Project Benefit Monitoring and Evaluation (PBME) Report (2001) cites some farmers as claiming that growing eucalyptus along with agricultural crops reduces overall yields. 11 Keerio, G.R., J. H. Ehrenreich and R. L. Mahler. 1993. Acacia nilotica Hurry Agroforestry System: Effect on some physical and chemical soil properties. Proceedings, third North American Agroforestry conference, 16-18 Aug. 1993, University of Idaho. 11 This assumes that the average specific gravity of wood produced is 0.55. 12 At a heating efficiency of 15% for fuelwood and 40% for kerosene, 5.7 kilogram (kg) of fuelwood is estimated to produce the same heat energy as 1 kg of kerosene. 13 Based on 0.81 as the average specific gravity of kerosene.
12
IV. OVERALL ASSESSMENT AND RECOMMENDATIONS
A. Overall Assessment
56. The Project was generally implemented as conceived. All major targets were either met or exceeded. Revisions were made during implementation to make the Project more relevant to prevailing conditions. Major revisions were the cancellation of the private sector component, the expansion of the social forestry component to cover the entire province, and the extension of the loan closing date from June 1999 to June 2001. The private sector component was canceled mainly because leasing of Government lands was banned. The social forestry component was expanded to take advantage of a growing awareness and interest in tree planting in the rest of the province. The loan closing date was extended to complete the physical target, provide basic care for newly planted seedlings, and formulate management plans for the sustainable management of irrigated plantations.
57. The reevaluated EIRR for the Project is 9% versus 20% at appraisal. A variety of factors may have caused this difference, including over-optimistic estimates of yield and prices, drought over the last 3 to 4 years, the delay in the establishment of plantations, and failures in some plantation areas. This exercise, however, shows that besides the EIRR, other nonfinancial project benefits should be considered in assessing its efficiency. These include (i) employment generation through both plantation development and harvesting; (ii) positive impacts on conservation and environmental protection, such as by providing habitat for wildlife, improving microclimates, reducing soil erosion, and stabilizing sandy soils along riverbanks; (iii) provision of free grazing areas for livestock; (iv) improvement of SFD’s institutional capacity; and (v) farmer training.
58. The overall rating should take into account the following: (i) the harsh environmental conditions prevailing in the project site, including saline soils, drought, extreme heat, and wind; (ii) SFD’s institutional ownership of the project―almost all key officers identify with it; (iii) the level of awareness that social forestry has generated; (iv) the physical accomplishments and the institutional capacity building of SFD; (v) the preparation of management plans for the irrigated plantations of the entire province; (vi) the overall benefits, particularly nonquantifiable benefits, that resulted from the Project; and (vii) the need to support the sustainability of the plantations, especially efforts to institutionalize the management plan and provide the necessary resources to implement it accordingly. Overall, the Project is considered relevant and efficacious. It had a significant impact on the institutional development of SFD. But the Project is considered less efficient than others, and its sustainability is not yet assured. The Project is rated as partly successful.
B. Lessons Learned
59. Although the target-oriented approach may have worked well in delivering required outputs, the overemphasis of accomplishments in terms of numbers might have affected the quality of outputs. Plantation failures could partly result from too much emphasis on the satisfaction of targeted numbers, while setting aside quality checks on contractor outputs and site selection.
60. The project management focused on the physical and financial progress of the Project. But besides maintaining adequate records for irrigated plantations, qualitative information was also gathered. Data on stand density or tree cover provided some qualitative measure of achievement of targets. Project management is now using such data to decide whether or not to replant. Reporting only the extent of areas planted for any given year does not indicate the overall area planted. To more meaningfully measure project accomplishments, the area planted as a physical 13 target for a given year should be accompanied by the accumulated areas with sufficient tree cover as a result of plantations established since the Project began.
61. Social forestry appears to be an efficient strategy to promote the policy of increasing forest cover and bridging the gap between supply and demand for wood, as indicated by its EIRR of 22% compared with the overall Project EIRR of 9%. But the Project, in its current design, is biased toward landowners and virtually excludes the landless. Thus, there is a need to develop a strategy that promotes social forestry and helps enhance livelihood security for marginalized groups.
62. The economic efficiency of developing new plantations in riverine and inland forest reserves has not been established; this is indicated by their low EIRRs, ranging from 0 to 1%. The low EIRRs are because the cost of land preparation and investment in irrigation infrastructure are high, compared with the benefits derived. But it is viable to place existing plantations (where irrigation systems are in place) under sustainable management; examples are the inland (rehabilitation) and the existing plantations covered by the integrated management plans. However, considering an ecological and environmental perspective, there would be good reasons to continue the forest cover program in Sindh, including the combat of desertification, preservation of biodiversity, soil stabilization, and minimization of soil erosion.
63. Most failures in the irrigated plantations may be caused by (i) soil salinity, (ii) improper land preparation, or (iii) drought. Implementors may control the first two causes, but drought is obviously beyond human control. The soil salinity problem may be avoided by better site selection. Similarly, closer monitoring can minimize, if not completely eliminate, improper land preparation. Project management has noted that success rates are generally higher in contracts that are of moderate size (200 ha or less) than in large contracts (more than 300 ha). This simply means that larger contracts are less manageable and thus, their quality of output is lower.
64. TA outputs can be more beneficial if (i) the TA is conducted in response to clearly identified gaps in knowledge, (ii) deliberate efforts are taken to respond to the outputs, and (iii) knowledge is transferred to end users. The management plans are fully appreciated because their use is readily seen, and filled a felt SFD need. In contrast, the assistance provided in developing benefit monitoring and evaluation system was not very successful because its use was not easily appreciated, no effort was made to utilize it, and there was no knowledge transfer. Thus for future projects, it will benefit the Executing Agency to include, when applicable, a phase for demonstrating the use of the results, and a reasonable time for knowledge transfer.
65. Participation of local communities in the community forestry subcomponent was primarily based on optimistic projections that a wood processing plant would be established to absorb production of eucalyptus plantations. This did not materialize, however, which dampened participants’ interest in tree plantations. Cancellation of the private sector credit component also highlights the need for careful policy analysis, assessment of existing and alternative tenurial arrangements, and extensive consultations with the stakeholders.
C. Recommendations
1. Project Related
a. Future Monitoring
66. Preparation of the forest management plans for the sustainable management of Sindh forests has been completed with Project assistance. This is an important condition for sustainable management, but it is not sufficient. An effective monitoring and evaluation system is also needed.
14
Although a team of consultants designed a monitoring and evaluation system in the initial stages of the Project, it was not operationalized for a variety of reasons, including lack of personnel and funds.
67. SFD should immediately start monitoring plan implementation. Monitoring could focus on the major inputs and outputs of plan implementation, with appropriate indicators selected to measure progress. For example, inputs could be measured in terms of personnel and budget required for the given period versus what inputs are actually provided. Outputs could be measured in terms of planned volume of stumpage for harvest versus actual harvested volume. Another indicator could be areas of plantation that were replanted. Such indicators could provide clues on the effectiveness of plan implementation, and provide early warning of potential problems. Data gathered could also serve as a basis for updating the management plans. SFD should also provide resources to make the GIS laboratory functional; that would further facilitate plan implementation by processing and organizing land-use information. The conservator of forests for research, planning, and monitoring and evaluation, in collaboration with concerned forest officers, could initiate the preparation of a plan for monitoring and evaluating the implementation of the management plan within the next two years. Considering its importance, monitoring and evaluation should be given priority in future fund allocations.
68. SFD should also periodically monitor the status of the social forestry plantations developed through the Project. Records show that participants have developed 18,600 ha of plantations, either as block plantations, line planting, shelterbelt, or hurries. Considering that this component was expanded to cover the entire province, it could have tremendous impact in the increase of forest cover and bridging the gap between supply and demand for wood. Monitoring all participants would be difficult and expensive, so it is important to periodically gather representative samples of information to monitor land size, cost and benefit streams, and experiences in plantation maintenance. Disaggregated data on community forestry could help document lessons learned and the financial impacts on participants.
b. Covenants
69. The Self-Financing Fund is the most frequently raised covenant, by far, in review missions. This covenant has not yet been complied with. Its rationale is to provide sufficient funds to maintain plantations established through the Project. The Government of Sindh has agreed to establish a steering committee to facilitate approval of this long-outstanding covenant by 30 June 2003. ADB and SFD should monitor developments closely to assure that the Government provides adequate funding to implement the Fund for all 14 forestry divisions.
c. Further Action or Follow Up
70. SFD should actively pursue building a network of wood-based industries. This would help in reforestation planning, and in establishing linkages between communities and potential industrial consumers of plantation products. Trips could be taken to visit small-scale wood processing operations, including portable saw mills, in countries such as the Lao People’s Democratic Republic.
71. Replanting of areas where planting failed. Decisions on whether to replant areas where plantings have failed should be based mainly on the additional costs, and the likelihood of establishing successful plantations. SFD should take the lead in realistically assessing potential sites with emphasis on environmental considerations such as soil properties, water availability, and 15 the feasibility of diversification of species.14 The possibilities of associations of communities and interested farmers should also be explored where there is a potential of growing agricultural crops along with forest species. This program of site identification, which is already underway in selected areas, should be completed by June 2004, so that budgets can be presented to the Government. The immediate priority should continue to be areas already developed, to minimize costs of replanting, and to stay within the Government’s budgetary constraints. Appendix 15 presents in tabular form, recommendations for further action or follow up.
d. Timing of Project Performance Audit Report
72. The project performance audit report, to more comprehensively assess project benefits and impacts, might be conducted in 2006—3 years from now. That timing would allow SFD sufficient time to replant areas where plantations failed. Project data indicate that replanting may be necessary on about 45% of the inland, and 43% of the riverine, plantations (about 6,700 ha). Bringing these areas into plantations within the next 3 years could improve the Project’s estimated EIRR. This would also give SFD time to implement the management plans, a key factor in sustainability of the irrigated plantations. Finally, about 66% of the plantings were made from 1997 to 1999; those plantations should be ready for harvest in about 3 years.
2. General
73. Review of ADB’s forest sector policy emphasized explicit linkage between the forest sector investments and poverty reduction with environmental protection. This will require both increased participation, and sharing of responsibilities and benefits, with poor local people. For this, SFD may have to shift its focus from mostly technical to a combination of technical and social aspects of forest management. SFD must take a facilitative or coordinative role, guiding its new partners in forest development, and ensuring that adequate assistance is provided.
74. The present stumpage sale system does not differentiate among products. Sale is based mainly on volume, which is measured in number of stacks of wood. Although sale goes to the highest bidder, the seller (SFD) may not always get the best possible value because of lack of product differentiation and the market prices not reflecting the real value of the product. The system should be improved to more accurately assess the volume and value of stumpage. First, there should be product differentiation, because prices of products differ. Stumpage may also be differentiated by its potential use, or its most economical use, such as for fuelwood or mine timber. Second, the unit of measure for stumpage should be changed to solid volume measurements such as cubic feet or cubic meters to more accurately measure its true volume. Furthermore, the change to solid volume will make yield easier to monitor because yield tables or projected growth in management plans are also expressed in solid volume.
14The Forestry Compendium and the database available at centers supported by the Consultative Group on International Agricultural Research could also be used to obtain information on the suitability and marketing prospects of crop species for specific sites.
16 Appendix 1
DETAILED DESCRIPTION OF PROJECT COMPONENTS
1. Components of the Project will be:
(i) Social Forestry: Assistance to farmers by establishing private farm woodlots and tree plantations, covering 12,000 hectares (ha), in shelterbelt areas, on eroding embankments and along waterways;
(ii) Rehabilitation of Government Reserved Forests: Rehabilitation of 21,000 ha of selected Government reserved forests that are seriously degraded because of drought and lack of silvicultural treatment;
(iii) Institutional Support: Strengthening of the institutional capabilities of the Sindh Forest Department (SFD) by providing staff training, research facilities, and consultant services; and
(iv) Private Sector Credit Component: Provision of credit on a pilot basis for private sector participation in the development of as much as about 3,000 ha of selected Government reserved forests, combined with the production of agricultural crops or industrial wood, or both.
2. An advisory technical assistance is also to be combined with the Project to provide institutional strengthening and support to the SFD during implementation.
A. Social Forestry
3. The social forestry component will augment the supply of fuelwood and timber in rural areas, using private land and on a sustainable basis. In the process, social forestry will lessen the pressure on Government reserved forests. Three major activities are envisaged over the Project’s 7-year period: community forestry, shelterbelt planting, and establishment of private woodlots, or hurries.15
1. Community Forestry
4. Through community forestry, 10,000 ha of forest plantations will be established on private lands in selected rural communities of five districts of lower Sindh: Karachi, Dadu, Thatta, Hyderabad, and Badin. The Social Forestry Circle of SFD will identify the communities and farmer participants. The Project will provide high-quality seeds and seedlings, mostly of Eucalyptus camaldulensis, and technical advice on site selection. SFD will teach farmers how to properly grow and care for planted trees, as well as thinning and harvesting techniques, through collaboration with selected farmer “motivators” and the Sindh Department of Agricultural Extension.
15 Hurries are private tree plantations, from 1 to 4 ha each, of Acacia nilotica (locally called babul). The hurry system was formalized in 1858 by Sir Bartley Frere, Sindh commissioner, to meet local fuelwood and minor timber requirements. Hurry growth on private farms in Sindh began in 1859. Appendix 1 17
5. SFD will grow sufficient seedlings in nurseries to be established in strategic locations throughout the five districts. Facilities will be provided for the multiplication of quality seeds, nursery operations, and delivery of planting stocks. SFD, through the farmer motivators or extension staff, or both, will identify and provide training for selected farmer participants, farmer groups, schools, and nongovernment organizations. When appropriated, SFD will establish contractual arrangements with these individuals or groups to establish and manage such nurseries, and produce and distribute seeds and seedlings.
6. Planting materials will initially be distributed at nominal charge through minikit packages. As the program advances and becomes accepted by farmers, cost recovery will gradually be introduced with the intention of recovering the full cost of seeds and seedlings. SFD will maintain registers on the number of seedlings distributed through this program, and its social forestry specialists will conduct field reviews during each planting season to ensure minimum wastage of seedlings.
2. Shelterbelt Planting
7. The project will establish about 2,500 kilometers (km) (equivalent to 1,000 ha) of lineal plantations on the borders of private farmlands and along irrigation canals to serve primarily as windbreaks to protect agricultural crops, but also to provide easily accessible timber and fuelwood. SFD has been planting shelterbelts on a few private farms in Hyderabad district. Shelterbelt planting will be extended to other districts. The major species, poplar or Polulus euamericana, and shisam or Dalbergia sissio, will be planted on a trial basis. The trees will be planted in two rows, 2 meters (m) apart and adjacent to canals and other waterways in a manner that will not prevent natural grass cover from growing on the embankment slopes. SFD will help farmers prepare the planting sites, and provide seedlings at cost.
3. Private Woodlots
8. Private woodlots, or hurries, have been established over a limited area only in Hyderabad district. The Project will encourage and support the establishment of 1,000 ha of private woodlots in Hyderabad and other Sindh districts to increase the supply of fuelwood and timber, and raise farmers’ incomes. The Project will assist farmer participants by offering technical advice on the proper establishment of hurries. Traditionally, farmers intercrop the trees, babul or Acacia nilotica, with agricultural crops such as cotton for the first 2 years, then tend them until maturity, at 5 or 6 years old. The trees are then harvested for fuelwood and timber. Babul is used in intercropping because of its ability to fix atmospheric nitrogen, which improves the productivity of agriculture land.
B. Rehabilitation Of Government Reserved Forests
1. Riverine Forests 9. In the riverine areas, six reserved forests covering 7,000 ha along the Indus river floodplain have been identified for development into well-managed forest plantations. These areas have historically relied on annual inundation for their water requirement. They have had virtually no silvicultural treatment. Timber stocking has been sparse and irregular. Much of the forest area is infested with weed species of low economic value such as mesquite. Rehabilitation will include the construction of simple, earthen canal systems to provide a regular flow of water from tubewells, or pumped from the river or natural depressions within the forests.
18 Appendix 1
Clearing, replanting, weeding, thinning, and intensive maintenance work will also be carried out to maintain the plantations in optimal condition.
10. The main species planted will be Acacia nilotica, directly seeded at 2 m x 2 m spacing (2,5000 seedlings/ha), rather than broadcast. The forests will be thinned 4 years after planting; harvest of the main crop is expected in year 6. A mean annual increment (MAI) yield of 25 m3/ha per year is assumed; a yield of 25 cubic meter (m3)/ha is also assumed from thinning after the fourth year. Provisions are also being made to replant immediately after each harvest.
2. Inland Planting
11. Rehabilitation of SFD’s inland reserved forests will involve the reestablishment of selected plantations or the renovation of existing plantations covering 14,000 ha (8,000 ha in new forest development, and 6,000 ha in rehabilitation). Water will mostly be supplied through gravity-fed irrigation networks. These reserved areas have confirmed sanctioned water allocations, which will be fully used as the plantations are established and grow to maturity, from the Sindh government’s Irrigation and Power Department. The main species to be raised in the inland forests, as in the riverine forests, is Acacia nilotica. The tree spacing is assumed to be 2 m x 2 m. The first harvest of the main crop can be expected in the sixth year, with an MAI of 25 m3/ha per year.
12. Ten inland reserved forests, covering about 8,000 ha, have been identified for plantation reestablishment. Most of these forests are almost treeless, are dominated by mesquite, and their irrigation canal systems have deteriorated badly because of a lack of maintenance.
13. Seven inland reserved forests, with an area of 6,000 ha, have been identified for renovation to improve their systems of water supply, and to intensify silviculture in their timber stands. Some of the areas identified for renovation are in the reserves where plantations will be reestablished.
14. The renovation will include planting of the Acacia nilotica for soil enrichment, and replacement of other species with acacia at a tree spacing of 2 m x 2 m. The renovated plantations will received regular silvicultural treatment, and are expected to produce as well as newly established plantations. Initial thinning during renovation is assumed to contribute a yield of 25 m3/ha. The renovated plantations will be harvested in the sixth year.
3. Irrigation System and Compartment Development
15. A key preparatory activity to ensure success of the forest rehabilitation program is providing an adequate supply of water through simple, but cost effective, irrigation systems. Irrigation systems were planned to serve the plantations through networks of minor canals, water courses, and smaller water carrying channels. The plantations are divided into compartments and subdivided into plots and subplots.1
C. Institutional Support
16. To ensure timely project implementation, provisions were made for: (i) a modest increase in SFD’s administrative and field staff, (ii) consultant services, and (iii) training and research facilities to strengthen field studies on tree species to be planted. In addition to the
1 A compartment is an area or subdivision of the forest plantation equal to 16 ha. Appendix 1 19 project director, who will be drawn from the ranks of senior SFD staff, the Project will engage the services of no more than 100 key support staff (mostly foresters and forest guards) during the project period. The Project will also provide vehicles, motorcycles, bicycles, office equipment, buildings, and field quarters. Silvicultural tools such as power saws, pruning knives, nursery facilities, and pumps, will also be provided.
D. Private Sector Credit Component
17. Private sector participation in forestry is a relatively new concept in Sindh, as well as in Pakistan itself. The private sector will be involved, on a pilot basis, in the development of as much as 3,000 ha of selected Government reserved forests through:
(i) contractual arrangements, either by long-term lease of selected state forestland, management for a fee, or other such arrangements to be determined by agreement among SFD, private entrepreneurs, and ADB. Arrangements might include the sharing of benefits with private farmers and nongovernment organizations; (ii) joint ventures between SFD and private sector companies in the development of selected state forestland, in combination with the production of agricultural crops or industrial wood, or both; (iii) provision of credit; or (iv) a combination of all of above.
18. SFD is envisaged to make suitable forestland available by long-term lease, and provide technical services to private sector participants. The private sector participants will contribute the capital, and will also be responsible for management and control of the joint venture. Considering the substantial development costs involved, the most likely participants are medium- to large-scale private sector agroindustries, or producers of wood-based products such as pulp, paper, or match boxes. Consultants under the advisory technical assistance associated with the Project will help finalize such arrangements during implementation.
20 Appendix 2
ESTIMATED TARGETS AND ACCOMPLISHMENTS FOR THE PERIOD OF 1993 TO 2003 UNDER THE SINDH FORESTRY SECTOR MASTER PLAN
Achievement by Component Unit Target 31 December 2002 %
1. Planting on Farmlands
(Area planted on private lands) ‘000 ha 88 19 22 2. Managing Riverine Forests New area restocked, Government) ‘000 ha 35 49 140 3. Managing Irrigated Plantations i. Plantation rehabilitation (government) ‘000 ha 10 10 100 ii. New area restocked (government) ‘000 ha 15 14 4. Amenity Planting ‘000 km 8 2 93
(Area planted, Government) 5. Private Planting on Nonforest public land ‘000 ha 5 - - Area planted, private 6. Protecting Arid Rangelands (No. of project areas) No. 2 2 100 7. Preserving Mangrove Forest Mangrove area planted ‘000 ha 30 25 83 8. Strengthening Education and Training Schools supported No. - - - - = not applicable; ha = hectare, no. = number. Source: Sindh Forest Department
Appendix 3 21
PROJECT TARGETS AND ACHIEVEMENTS
Original MTR / Achievement I t e m Extension
1. Social Forestry Community (ha) 10,000 16,000 16,000 Forestry Shelter Belt (ha) 1,120 1,600 1,600 Hurries (ha) 1,000 1,000 1,000 2. Irrigated Plantation Riverine Forest (ha) 7,000 3,000 3,149 Inland Forest (New) (ha) 8,000 12,000 12,000 Inland (Rehab) (ha) 6,000 7,000 7,000 Nurseries million 13.08 18.08 15.44 seedlings 3. Institutional Support Training Local a) SFD Staff (pm) 100 75 75 b) Farmers (pm) 300 400 400 Overseas (pm) 60 50 43 Consulting Services a) International (pm) 45 51 51 b) Local (pm) 176 160 151 Vehicles (no) 13 17 17 Motorcycles (no) 30 30 30 Buildings (no) 16 17 17 Incremental Staff (no) 100 100 100 Permanent Nursery (no) 0 5 5 Management Plans (no) 0 14 14 4. Private Sector (ha) 3,000 canceled 0
ha = hectare; MTR = midterm review; no = numbers; pm = person-months ;SFD = Sindh Forest Department. Source: Sindh Forest Department.
22 Appendix 4
VEHICLES AND EQUIPMENT PROCURED
Items At Appraisal Actual Mode of Procurement
Vehicles 15 17 LCB Motorcycles 40 30 LCB Photocopiers 2 7 LCB Computers with Printers 2 20 LCB Computer Software 0 1 LCB HP Scanner 0 4 LCB UPS Dry Battery 0 10 LCB Electric Typewriters 13 12 LCB Manual Typewriters 10 19 LCB Mimeograph Machine 1 0 LCB Cooling Equipment 8 14 LCB Electric Fans 10 15 LCB Pocket Calculators 10 13 LCB Field Study Equipmenta 6 6 LCB Panaboard 0 2 LCB Digital Camera 0 2 LCB Slide Projector 0 1 LCB Multimedia Projector 0 1 LCB Overhead Projector 0 1 LCB Fax Machine 0 2 LCB Stabilizer 0 10 LCB Digitizer 0 2 LCB GPS 0 4 LCB Plotter 0 2 LCB Electric Tubewells 4 10 LCB Lift Pump (Diesel) 10 33 LCB Lift Pump (Electric) 10 0 LCB Generators 0 2 LCB
GPS = global positioning system; HR = Hewlett Packard; LCB = local competitive bidding; UPS = uninterrupted power supply. a Cost provision for field study instruments, silvicultural tools included but the quantity was not specified. Source: Sindh Forest Development Project.
TRAINING COURSES AND STUDY TOURS FOR PERSONNEL OF THE SINDH FOREST DEPARTMENT AND SINDH FARMERS
Table A5.1: Training for Personnel of the Sindh Forest Department Number Period of Staff Period of Person- Title of Training/ Course Institution Trained Training Months From To
A. Special Course on Social Pakistan Academy for 1 2 weeks 0.5 5 Feb 1994 17 Feb 1994 Forestry Rural Development, Peshawar
B. Water Management and Pakistan Institute of 10 6 weeks 15 15 Feb 1994 5 Apr 1995 Irrigation Planning Management, Lahore Irrigation planning water Management
C. Management Information Pakistan Institute of 5 1 week 1 29 Oct 1994 3 Nov 1994 Systems Management, Lahore (MIS)
D. Surveying and land leveling SOKIA Pakistan (pvt) Ltd, 10 2 weeks 5 26 Dec 1994 9 Jan 1995 Karachi
E. Word processing National Institute of Public 1 5 days 0.25 28 Jan 1995 2 Feb1995 Administration, Karachi
pp
F. Environmental Management Pakistan Institute of 2 10 days 0.5 18 Mar 1995 22 Mar 1995 5 Appendix Training Course Management, Karachi
G. Short course in Communication Pakistan Academy for 1 4 days 0.25 27 Mar 1995 30 Mar 1995 and Extension Rural Development, Peshawar
23
Number 24 Period of Staff Period of Person- Title of Training/ Course Institution Trained Training Months From To 5 Appendix
H. Geographic Information Systems Pakistan Forest Institute, 1 26 days 1 2 Apr 1995 27 Apr 1995 Professional Level Training Peshawar course
I. 36th Course in Financial Pakistan Institute of 1 26 days 1 16 Apr 1995 11 May 1995 Management Management, Lahore
J. Short Course on Formulation Pakistan Academy for 2 4 days 0.25 28 May 1995 31 May 1995 and Appraisal of Projects Rural Development, Peshawar
K. Office Management Course Pakistan Institute of 5 1 week 1 26 Aug 1995 31 Aug 1995 Management, Lahore
L. Financing & Accounting for Non- Pakistan Institute of 2 1 week 0.5 7 Oct 1995 12 Oct 1995 Financial Executives Management, Lahore
M. Personal Computing for Chief Pakistan Institute of 1 3 days 0.25 21 Oct 1995 23 Oct 1995 Executives Management, Lahore
N. Management Information System Pakistan Institute of 4 1 week 1 23 Dec 1995 28 Dec 1995 Management, Karachi
O. Agroforestry Extension Training Pakistan Forest Institute, 6 1 week 1.5 2 Mar 1996 7 Mar 1996 Peshawar
P. Forestry Techniques and Pakistan Forest Institute, 12 1 week 3 16 Mar 1996 21 Mar 1996 Planting Techniques Peshawar
Q. Sampling Techniques and Pakistan Forest Institute, 6 1 week 1.5 23 Mar 1996 28 Mar 1996 Experimental Design Peshawar
Number Period of Staff Period of Person- Title of Training/ Course Institution Trained Training Months From To
R. 10th National Beekeeping National Agriculture 1 1 week 0.25 17 Apr 1996 21 Apr 1996 Training Course Research Centre, Islamabad
S. Disbursement Seminar in Pakistan Resident Mission, 2 4 days 0.25 23 Apr 1996 25 Apr 1996 Pakistan Asian Development Bank, Islamabad
T. Forest Inventory and Design Pakistan Forest Institute, 6 2 weeks 3 4 May 1996 15 May 1996 Analysis Peshawar
U. Decentralized Off-Campus North-West Frontier 4 3 days 0.5 18 Jun 1996 20 Jun 1996 Training Course (Project Province Forest Planning for Forestry Projects) at Department & Swiss Abbotabad Agency
V. Introduction to MS-Excel in Pakistan Institute of 3 1 week 0.75 29 Jun 1996 4 Jul 1996 Management Development Management, Karachi Programme
W. Testing and Handling of Tree Pakistan Forest Institute, 10 3 days 1.5 15 Sep 1996 18 Sep 1996 Seed Peshawar
X. Effective Letters, Reports and Pakistan Institute of 1 1 week 0.25 15 Feb 1997 20 Feb 1997 Presentations. Management, Karachi
pp Appendix 5 Appendix Y. MS-Word, Excel, Windows 95 M/s Petromans, Hyderabad 4 2 weeks 2 7 Apr 1997 28 Apr 1997
Z. MS-Dos, Excel, Windows-95 M/s Petromans, Hyderabad 2 2 weeks 1 28 Apr 1997 19 May 1997
AA. One year Diploma in Computer M/s Petromans, Hyderabad 2 12 months 24 Jul 1997 Jun 1998 Science 25
Number 26 Period of Staff Period of Person- Title of Training/ Course Institution Trained Training Months From To 5 Appendix
BB. Training Course on Forestry Pakistan Forest Institute, 6 1 week 1.5 21 Jul 1997 26 Jul 1997 Extension Peshawar
CC. Training Course on Computer Pakistan Forest Institute, 4 1 week 1 8 Sep 1997 13 Sep 1997 Handling Peshawar
DD. Training Course on Forest Pakistan Forest Institute, 12 1 week 3 29 Sep 1997 5 Oct 1997 Nursery Techniques Peshawar
EE. Geographic Information Systems Pakistan Forest Institute, 2 3 weeks 1.5 15 Nov 1999 04 Dec 1999 Training Course Peshawar
FF. Short Course on Computer Centre of Excellence in 2 2 weeks 1 31 Jul 2000 12 Aug 2000 Application in Project Water Resources Management Engineering, University of Engineering and Technology, Lahore
Total 131 75
Source: Sindh Forest Department.
Appendix 5 27
Table A.5.2: Training and Study Tours for Farmers
Date of Training Number of District From To Farmers Trained
Karachi 23 Jan1993 6 Feb 1993 30 Thatta 24 Apr 1993 6 May 1993 31 Hyderabad 12 Jun 1993 24 Jun 1993 29 Badin 21 Aug 1993 2 Sep 1993 30 Thatta 13 Nov 1993 27 Nov 1993 30 Dadu 3 Jan 1994 17 Jan 1994 30 Hyderabad 6 Feb 1994 20 Feb 1994 38 Karachi 28 Jun 1994 12 Jul 1994 30 Hyderabad 16 Oct 1994 2 Nov 1994 34 Dadu 21 Mar 1995 4 Apr 1995 31 Hyderabad 21 May 1995 5 Jun 1995 30 Nawabshah 12 May 1995 23 Jun 1995 30 Badin 14 Jun 1995 28 Jun 1995 30 Thatta 21 Apr 1996 25 Apr 1996 42 Nawabshah 15 May 1996 23 May 1996 30 Naushehro Feroze 26 May 1996 6 Jun 1996 30 Badin 8 Jun 1996 18 Jun 1996 30 Mirpur Khas 16 Jun 1996 27 Jun 1996 29 Nawabshah 22 Feb 1997 1 Mar 1997 40 Naushehro Feroze 23 Feb 1997 2 Mar 1997 40 Hyderabad 22 Feb 1997 1 Mar 1997 40 Badin 22 Feb 1997 1 Mar 1997 40 Hyderabad 22 Sep 1997 26 Sep 1997 40 Dadu 10 Nov 1997 14 Nov 1997 40 Mirpur Khas 1 Jun 1998 7 Jun 1998 30 Jacobabad 1 Jun 1998 7 Jun 1998 30 Shikarpur 8 Jun 1998 13 Jun 1998 30 Naushehro Feroze 8 Jun 1998 14 Jun1998 30 Sanghar 8 Jun 1998 14 Jun 1998 28 Khairpur 8 Jun 1998 14 Jun 1998 21 Total 973
Source: Sindh Forest Department
DETAILED PROJECT COST ($'000)
28 As Per Appraisal Actual
Component Foreign Local Total ForeignLocal Total Appendix 6 Appendix 1. Social Forestry Community Forests 232 2,091 2,323 564 2,257 2,821 Shelterbelt 25 229 254 59 249 308 Hurries 13 120 133 33 21 154 Subtotal 270 2,440 2,710 656 2,627 3,283 2. Forest Plantations Riverine Plantations 5,599 6,593 12,192 4,221 2,646 6,867 Inland Forests (Irrigation) - New 5,561 5,551 11,112 4,126 2,655 6,781 Inland Forests (Irrigation) - Rehabilitation 1,410 2,411 3,821 1,032 1,130 2,162 Subtotal 12,570 14,555 27,125 9,379 6,431 15,810 3. Institutional Support Training and Research 300 126 426 320 112 432 Consulting Services 686 948 1,634 699 767 1,466 Vehicles, Equipment 812 570 1,382 1,056 357 1,413 Buildings/Nurseries 146 309 455 398 600 998 Operation and Maintenance 189 124 313 18 476 494 Incremental Staff Support 0 500 500 0 1,404 0 Subtotal 2,133 2,577 4,710 2,491 3,716 6,207 4. Private Sector Credit Component 1,500 1,500 3,000 0 0 0 Total Base Cost 16,473 21,072 37,545 12,526 12,774 25,300 Contingencies Physical Contingency 1,647 2,107 3,754 0 0 0 Price Escalation 4,125 5,454 9,579 0 0 0 Service Charge 1,122 0 1,122 889 0 889 Total Project Cost 23,367 28,633 52,000 13,415 12,774 26,189
Source: Asian Development Bank.
ASIAN DEVELOPMENT BANK ANNUAL DISBURSEMENT OF LOAN PROCEEDS ('$'000)
Category Description 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 Total
01A Civil Works - Plantations - - - 350 1,569 2,059 1,936 4,273 1,329 701 4 12,221 Civil Works -Project & Institutional. 01B Support - 51 372 96 178 73 23 83 38 35 3 952 02 Equipment and Materials - 187 169 36 58 339 10 190 65 99 - 1,153 03 Training and Study - 9 7 104 103 89 30 33 6 39 - 420 Establishment & Maintenance- 04A Social Forestry - 174 287 199 407 412 774 588 147 40 - 3,028 Establishment & Maintenance- 04B Plantations - 27 22 135 416 468 140 215 372 814 - 2,609 04C Establishment & Maintenance- Project & Institutional Support - - 7 1 3 3 1 5 1 5 - 26 05 Consulting Services - 63 548 203 305 218 76 24 9 18 3 1,467 06 Agricultural Development Bank of Pakistan Credit ------08 Service Charge During Construction - 4 9 25 53 70 98 134 190 206 100 889 09 Unlocated ------
Total - 515 1,421 1,149 3,092 3,731 3,088 5,545 2,157 1,957 110 22,765
Source: Asian Development Bank.
Appendix 7 Appendix 29
A ppendix 8 30 ppendix
IMPLEMENTATION SCHEDULE
1992 19931994 1995 1996 1997 1998 1999 2000 2001 12 3 4123412341234123412341 2 34123412341234
A. Project Management 1. Establishment of Project Office and Staff Appointment 2. Procurement of Office Equipment, Supplies ans Materials 3. Procurement of Vehicle, Field, Equipment, Tools B. Social Forestry Component 1. Establishment of District Nurseries 2. Procurement of Vehicles, Equipment, Supply 3. Establishment of Community, Shelterbelts, and Hurries 4. Training (Overseas and Local) C. Rehabilitation of Reserved Forests 1. Mapping of Plantation Sites 2. Land Clearing, Leveling 3. Plantation Establishment and Rehabilitation Work 4. Installation of Water Supply System 5. Silvicultural Operations 6. Procurement of Vehicles and Equipment 7. Training D. Private Sector Credit Component 1. Secelction of Participants 2. Contractual Agreements 3. Project Implementation
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 12 3 4123412341234123412341 2 34123412341234
E. Engagement and Fielding of Consultants 1. Loan Financed (Expatriate) a) Implementation Adviser ( 36 mm ) b) Forestry Extension Specialist ( 6 mm) c) Tree Improvement/Silviculture Specialist ( 3 mm) 2. Loan-Financed (Local) a) Rural Sociologists ( 6 mm ) b) Legal Adviser ( 6 mm ) c) Irrigation Adviser ( 8 mm ) ` d) Mapping Contract e) Engineering ( 156 mm ) f) PBME g) Forest Management Specialist h) Forest Economist 3. TA-Financed (Expatriate)
a) Forest Inventory Specialist ( 9 mm ) 8 Appendix pp b) Institution Specialist ( 6 mm ) c) Private Sector Specialist ( 4.5 mm ) d) Technical Adviser ( 1.5 mm )
4. TA-Financed (Local) 31
a) Management ( 42 mm )
Legend Apprai Actual
ORGANIZATIONAL CHART OF THE SINDH FOREST DEPARTMENT AT PROVINCIAL LEVEL
Chief Conservator of Forests A
Sindh At Hyderabad 9 ppendix (BPS-20) 32
DFO, Coastal DFO, Direction DFO, Planning B & AO (Forests) pp Division Division (BPS-17) Karachi (BPS-18) (BPS-18) (BPS-18)
C.F. AFF C.F. AFF C.F, AFF C.F. AFF C.F.PBME DIRECTOR PD/CF SFD CIRCLE CIRCLE CIRCLE CIRCLE THATTA CIRCLE SERICULTURE HYDERABAD SUKKUR LARKANA HYDERABAD (BPS-19) HYDERABAD HYDERABAD (BPS-19) (BPS-19) (BPS-19) (BPS-19) (BPS-19) (BPS-19)
DFOs DFOs DFOs DFOs DFOs DFO DFO/Sub-DFOs 1.M. Mathelo (BPS- 1.Larkana(BPS- 1.Hyderabad(BPS- 1. Thatta (BPS-16) 1.Silviculture (BPS- 1. Sericulture 1. Hyderabad (BPS- 16) 18) 18) 2. T.M. Khan (BPS- 18) 18) 2. Sukkur (BPS- 2.Shikarpur(BPS- 2.N. Shah (BPS-16) 18) 2.Principal (BPS-18) 2. Sukkur (BPS-18) 15) 18) 3.R.M. Norpukhas 3. Range Mgt Karachi 3.Working Plan Hyd 3. Thatta (BPS-17) 3. Khairpur (BPS- 3.Dadu(BPS-18) (BPS-18) (BPS-18) (BPS-18) 4. Shikarpuir (BPS- 16) 4. Khipro (BPS-17) 4.Working Plan 17) Sukkur (BPS-18)
ABSTRACT
Post BPS No. C.C.F. Sindh 20 1 C.F. 19 5 P.D 19 1 Director 19 1 DFOs 18 22 Sub DFOs 17 3 B&AO (Forest) 17 1
Legend: AFF = Afforestation; B & AO = Budget & Accounts Officer; BPS = Basic Pay Scale; CCF = Chief Conservator of Forest; CF = Conservator of Forest; DFO = Divisional Forest Officer; PBME = Project Benefit Monitoring and Evaluation; PD = Project Director; SFD = Sindh Forest Department
Appendix 10 33
STATUS OF COMPLIANCE WITH LOAN COVENANTS
Covenant Reference Status of Compliance
Project Executing Agencies Sindh, acting through the Sindh Forest Department Schedule 6, Complied with. (SFD) shall be the Project Executing Agency for parts para. 1(a) A and B of the Project, and shall have overall responsibility for project implementation and coordination. Parts A and B shall be implemented generally by SFD and particularly by the Conservators for Social Forestry, Research Circle and Afforestation Circle, Hyderabad, and Sukkur.
The Agricultural Development Bank of Pakistan Schedule 6, Component canceled (ADBP) shall be the Project Executing Agency for part para. 1 (b) during the midterm C of the Project. Part C shall be implemented by review mission. ADBP’s Project Loans Department in collaboration with SFD.
Steering Committee
The Borrower shall establish an international steering Schedule 6, Complied with. committee, chaired by the secretary of SFD. The para. 2 steering committee shall meet whenever necessary, but at least once every quarter, to oversee policy matters and general planning, implementation, and management of the project benefit monitoring and evaluation.
Project Management Office and Additional Chief Conservator of Forests
A Project Management Office (PMO) shall be Schedule 6, Complied with. established within SFD within 3 months of the effective para. 3 date to coordinate and implement the Project in conjunction with ADBP. The PMO shall be headed by a full-time project director who will be a senior SFD conservator of forests and shall also occupy the new post of additional chief conservator of forests (PDAC) for Sindh. PDAC and key PMO staff will be provided appropriate incentives to perform their tasks.
Riverine Areas Pilot Section and Implementation
(i) SFD shall appraise and select individual riverine Schedule 6, This loan covenant has subprojects according to feasibility appraisal and para. 4 been complied with. selection criteria acceptable to Sindh and the Asian Based on the feasibility Development Bank (ADB). and economics of the riverine subproject, the (ii) Such selected riverine subprojects shall be riverine forest target was submitted to ADB for approval. reduced from 7,000 hectares (ha) to 3,000 ha during the Project's midterm review.
34 Appendix 10
Covenant Reference Status of Compliance
(iii) SSFD may commit no more than 20% of the total loan amount allocated to the Project’s part A(2)a for approved riverine subprojects; provided that ADB agrees to increase the percentage after reviewing the riverine forest economics recommendation (if any) in the midterm report.
Timely Recruitment of Staff
Sindh shall appoint adequate and qualified staff to Schedule 6, Complied with. PMO and SFD for project implementation in para. 5 The required staff has accordance with the schedule satisfactory to ADB, but been recruited. in any event before relevant project components begin.
Sindh shall have SFD (i) increase its in-house staff Complied with. ability to operate and to maintain irrigation systems, and (ii) supplement such in-house ability with that of either the Irrigation and Power Department or qualified private contractors, or both.
Water Supply
Sindh will supply at all times the agreed allocations, Schedule 6, Complied with. including an adequate supply of irrigation water para. 6 Sufficient water was suitable to meet plantation movements for the inland provided. forest areas under part A(2) (b), to ADB’s satisfaction.
Sindh shall not restrict, or cause restriction of, the supply of suitable irrigation water to any forest areas under part A of the Project.
Nurseries and Seed Distribution
Sindh shall have SFD contract with individual farmers, Schedule 6, Complied with. Records farmers’ groups, and nongovernment organizations para. 7 of farmer participation in (NGOs) to (i) upgrade or establish and operate fast- the social forestry growing tree seed nurseries in strategic locations component have been within the project area; and (ii) propagate, raise, and computerized. The distribute seeds and seedlings to community records were submitted participants. Seeds and seedlings will initially be to Dr..K. M. Siddiqui, the provided at nominal cost, but the cost should increase ADB consultant who to full cost recovery during the term of the Project. conducted the low- intensity evaluation of Sindh shall have SFD (i) maintain registers and the Project. The report records of the number, types, and spread of seeds and has been submitted to seedlings distributed through the Project; and (ii) ADB. conduct, through its social forestry specialists, field reviews of seed and seedling distribution during each planting season. The nature and extent of any seed or seedling waste should be emphasized.
Appendix 10 35
Covenant Reference Status of Compliance
Community Liaison and Participation
Sindh will have SFD strengthen liaison with, and Schedule 6, Complied with. coordination, and participation of, private farmer para. 8 motivators, farmers, community groups, and NGOs that are involved. Particular emphasis should go to extension services and public education institutions, and to follow-up tree care and community forestry participants.
To accomplish the above: (i) Sindh or SFD, or both, may offer incentives, including commercial and monetary incentives, with prior ADB approval; and (ii) Sindh will formulate a plan and schedule for coordination of social forestry activities of SFD and the Sindh Agriculture Department, and submit it for ADB approval within 6 months of the effective date. The plan shall be promptly implemented, on schedule, through a Government order.
Self-Financing Arrangements
Sindh shall have SFD establish either a self-financing Schedule 6, Partly complied with. fund, or other arrangements that ADB finds para. 9 The issue is being taken satisfactory, for the receipt from and including 1 July up with the Finance 1998, of at least 50% of revenues generated from the Department of the operations of the Government reserved forest areas Government of Sindh. under part A (2) of the Project. The Government provided PRs18.89 million in 2001–2002; PRs11.90 million have been provided for the first 6 months of 2003. Forest Management
Sindh shall ensure that reserved forest areas under the Schedule 6, Complied with. SDF has Project will be managed in accordance with sound and para. 10 prepared and sent 14 sustainable forest management practices that ADB forest management finds satisfactory. plans to ADB.
Minimum Forest Cover
Sindh shall preserve and maintain at all times a forest Schedule 6, Complied with. The cover of at least 70% in the project area. para. 11 surviving forest cover is higher than the benchmark of 70%. Efforts will be made to maintain the plantation cover, provided that funding is adequate.
36 Appendix 10
Covenant Reference Status of Compliance
Social Forestry Expansion
Sindh shall commit its best efforts to extend and Schedule 6, Complied with. The increase its social forestry program throughout the para. 12 social forestry program province. has been extended to cover the entire province.
Modified Forestry Policies
Sindh shall promptly implement, or have SFD Schedule 6, Recommendations of implement, the forestry recommendations of (i) the para. 13 the Pakistan Forestry Brundtland Commission, and (ii) the Pakistan Forestry Sector Master Plan, Sector Master Plan, in a manner acceptable to ADB. especially for riverine and inland forests and social forestry, are being complied with. Programs envisaged in the master program for the above, and for other disciplines are being proposed to the Government and donor agencies.
Revised Sindh Forestry Regulations
Sindh shall review the Forest Act and other forest- Schedule 6, Relevant sections of the related regulations to identifying ways to tighten their para. 14 Forest Act, such as enforcement, including through possible amendments sections 23, 33, 42, and of laws and regulations. 63 that regarding punishments for offenders in reserved and protected forests have been amended to increase fines and terms of imprisonment.
Environmental Aspects Sindh shall ensure that (i) environmental protection Schedule 6, Complied with. controls and measures are included in the design of all para. 15 project facilities, (ii) such controls and measures are maintained in good operating condition, and (iii) budgets are adequate to cover operating expenses related to environmental aspects of the Project.
Operation and Maintenance
Sindh shall ensure that SFD adequately maintains, and Schedule 6, Complied with. repairs and replaces when necessary, all project para. 16 facilities, including buildings, furniture, and equipment.
Appendix 10 37
Covenant Reference Status of Compliance
Project Benefit Monitoring And Evaluation
Within 3 months of the effective date, SFD shall Schedule 6, Complied with. A firm develop a project benefit monitoring and evaluation para. 18 was fielded to conduct (PBME) report, and submit it to ADB for approval. the project benefit monitoring and Sindh shall ensure that appropriate records are kept, evaluation program. Its and data are gathered, to evaluate the Project’s final report was socioeconomic impact. SFD’s Office of Conservator, submitted to the PMO Planning, Monitoring, Evaluation and Research Circle and ADB. (CPRC) will monitor Project benefits
Within 12 months after the effective date, CPRC shall conduct a benchmark survey of the project area, satisfactory to ADB. In collaboration with the PMO, CPRC will promptly prepare a survey report for ADB approval.
Prior to the end of every quarter, CPRC shall submit collected project benefits information to the PMO.
The PMO shall compile and evaluate such information and prepare summaries to be included in quarterly PBME reports submitted to ADB.
During project implementation and for 1 year after the project completion report is submitted, PMO shall furnish ADB with annual PBME reports.
Training and Study Programs
The PMO shall prepare the selection criteria for Schedule 6, Complied with. training programs. The detailed criteria and para. 19(a) procedures, and the implementation schedule for the training and study programs, shall be submitted to ADB for approval within 18 months of the effective date.
The PMO shall be responsible for detailed formulation Schedule 6, Complied with. and administration of training and study programs. Para. 19(b)
Relending Rates This component was canceled, so this loan Beginning in FY1991, the Borrower shall relend the Schedule 6, covenant needs no loan proceeds to ADBP at a minimum rate of return of para. 20 more compliance. 6% per annum, which is the prevailing relending rate charged to ADBP by State of Bank of Pakistan. SBP on net additional borrowings, or the equivalent of the variable interest rate applicable to ADB’s ordinary operations loans, whichever is higher.
38 Appendix 10
Covenant Reference Status of Compliance
In 1992, the rate will be 7% per annum or its equivalent. The minimum rate of return for 1993 will be determined during an annual review to be conducted in FY1992, but it will no be less than 7% per annum.
Onlending Rates
The Borrower shall ensure that the spread between the Schedule 6, This component has relending rate and onlending rate covers ADBP’s para. 21 been canceled, so the costs, profit margin, and lending risks, as well as loan covenant needs no maintains a minimum lending margin of no less than more compliance. 6% onlending terms (Loan Agreement, page 36, paras. i–v).
ADBP Credit
ADBP shall implement part C of the Project in Schedule 6, paras. 22 This component has accordance with the Loan Agreement, page 37, para. and 23 been canceled, so the 23. loan covenant needs no more compliance. Obligations of Sindh
Sindh shall prepare and promptly provide to ADB Project Agreement, Complied with. plans, design standards; specifications, and work Section 2.05 schedules; in such detail as ADB requests.
Sindh shall furnish to ADB unaudited financial Project Agreement, Complied with. statements and accounts no less than 3 months after Section 2.08(a) The audited financial the close of each fiscal year. Sindh will provide ADB statements and certified copies of such audited accounts and financial accounts of the Project statements, and the auditors’s report, no later than 6 were regularly submitted months after the close of the fiscal year. All will be in to ADB. English.
In addition to the financial statement referred to Project Agreement, Complied with. above, Sindh shall furnish to ADB an annual Section 2.08(b) performance report summarizing the results of operations under parts A and B of the Project, and the PBME on to be submitted. The schedule will be: (i) the annual performance report will be submitted within 6 months after the end of the fiscal year, beginning in FY1991–1992 until 2 years after project completion; (ii) the PBME will be submitted only upon ADB’s request, until the date of termination specified in section 6.02.
Soon after completion of parts A and B, but no later Project Agreement, than 3 months afterward, Sindh shall prepare and Section 2.09 furnish to ADB a project completion report.
Appendix 10 39
Covenant Reference Status of Compliance
Obligation of ADBP
ADBP shall furnish to ADB certified copies of audited Project Agreement, This component was accounts and financial statements, and the “long form” Section 3.04 canceled, so the loan reports of the auditors, no later than 6 months after the covenant needs no close of the fiscal year. All will be in English. more compliance.
ADB shall maintain a debt:equity ratio no higher than Project Agreement Project Agreement, 7:1. Section 3.06 Section 2.08(a)
ADBP shall maintain a debt service coverage in Project Agreement, This component was relation to (i) the total of its profit, after taxation, on a Section 3.07 canceled, so the loan cash basis, increased by interest and other charges on covenant needs no its borrowings plus its actual loan principal collections more compliance. for each period, as compared to (ii) its debt servicing obligations (interest and other charges and principal repayments), maturing during the same period which: a) for the period following the end of Fiscal Year 1991 shall be 1.10; and b) for the period following the end of Fiscal Year 1993 shall be 1.25.
ADBP shall prepare and furnish to ADB a report on Project Agreement, This component was utilization of the Loan, execution of the projects, their Section 3.09 canceled, so the loan costs, and ADBP’s accomplishments and performance covenant needs no in meeting its obligations no later than 6 months after more compliance. the closing date for withdrawal.
ADBP credit – The amount of the Loan allocated for Project Agreement, This component was the Credit may be withdrawn from the Loan Account to Section 4.01 canceled, so the loan finance the reasonable foreign currency cost of goods covenant needs no and services required for the Qualified Project in more compliance. respect of which the withdrawal is requested.
Sindh and ADBP shall furnish to ADB a quarterly Section 4.06 Complied with. The progress report on a regular basis. quarterly progress reports have been submitted to ADB on a regular basis.
40 Appendix 11
STATUS OF CONSULTANT RECRUITMENT
Appraisal Target Actual Type of Consultant (person-months) (person-months) Type of Consultant International Consultants: A. Project Implementation Advisor 36 42 B. Forest Extension Specialist 6 6 C. Tree Improvement/Silviculture Specialist 3 3 Subtotal 45 51
Local Consultants: D. Rural Sociologist 6 6 E. Legal Advisor 6 0 F. Irrigation Advisor 8 33 G. Topographic Irrigation Advisor 0 25 H. Engineering Consultant 156 65 I. Project Benefit Monitoring & Evaluation (PBME) 0 4 J. Forest Management Specialist 0 12 K. Forest Economist 0 6 Subtotal 176 151
Total 221 202
Source: Government Project Completion Report, December 2002.
Appendix 12 41
TECHNICAL ASSISTANCE COMPLETION REPORT Agriculture, Environment and Natural Resources Division:
TA No. and Name Amount Approved: $560,000 1468-PAK: Institutional Strengthening of Sindh Forest Revised Amount: Department Executing Agency: Source of Funding: TA Amount Undisbursed TA Amount Utilized Sindh Forestry Department TASF $1,938.36 $558,061.64 Date Closing Date Fielding of Original Actual Approval Signing Consultants 31 Dec 1998 30 June 1999 24 Jan 1991 2 April 1991 July 1992 Description It was recognized at appraisal that there is a need to strengthen the capacity of the Sindh Forest Department (SFD) to facilitate the successful implementation of the Sindh Forestry Development Project. It was realized that a system was to be developed and institutionalized for assessing riverine and inland forest resources managed by SFD. In addition, in view of the harsh conditions and marginal and degraded land resources, it was recognized that staff skills were to be enhanced to ensure the selection of appropriate sites offering the greatest potential for successful plantation development. The need for an effective planning, monitoring and evaluation system was identified to support SFD in sustainable management of forest resources in Sindh.
Objectives and Scope
The technical assistance was designed to focus on the following key areas: • forest inventory systems for riverine and inland forests; • planning, monitoring and evaluation systems for project components, including benchmark surveys of project area; selection and appraisal of subprojects; • identification and evaluation of and recommendations for an appropriate institutional, legal and financial framework for private sector participation; • institutional assessment of SFD and proposals for improvement on organizational structures; and • training of SFD staff.
Evaluation of Inputs In general the consultants performed satisfactorily. The internationally-recruited consultants provided inputs in the following areas. The forest inventory consultant developed the systems and procedures needed by SFD in assessing its forestry resources. The forestry extension specialist developed guidelines for social forestry. The private sector consultants interacted with the key stakeholders including potential investors and representatives of wood-based industries. The inputs provided by a local consulting firm were related to the designing a system for selection and appraisal of subprojects. In addition the firm also designed the planning, monitoring and evaluation systems for the project components. The firm also conducted the benchmark surveys to assess the physical resources in the project area. The Asian Development Bank (ADB) provided extensive support in the implementation of the technical assistance (TA) and made several recommendations for improving the quality of the outputs and their relevance to the emerging needs of the Project.
Evaluation of Outputs The systems and procedures developed by the forest inventory consultant have been found useful in assessing the tree resources managed by SFD. In addition, it provides a basis for conducting future inventory work. The guidelines developed by the forestry extension specialist were widely disseminated to promote social forestry and also formed the basis for instituting forest conservation subjects in curriculum in natural resources at the Agriculture University in Sindh. The support provided by the private sector consultants were appreciated as these were based on extensive interaction with the key stakeholders including potential investors and representatives of wood-based industries. The local consulting firm completed a range of tasks and produced benchmark survey reports and design of monitoring and evaluation systems and designed a
42 Appendix 12 system for selection and appraisal of riverine and inland subprojects. The district profiles developed by the local consultants provided extensive data and information and are being used by several departments in Sindh in addition to SFD. Under the TA, services of a forestry specialist was also utilized to carry out an inventory of existing irrigated plantations developed under the Project and also assess the progress of social forestry plantations. In general, the outputs were well received within SFD and were also utilized in strengthening capabilities in planning and inventory management systems. Outputs generated to enhance the monitoring and evaluation systems were not fully institutionalized mainly due to lack of budgetary and manpower resources. The outputs of the private sector specialists/economist although highly appreciated did not find any meaningful use as the private sector component was canceled. Through studies, valuable information was provided to SFD on the stocking and density of plantations under social forestry. In some areas relating to institutional strengthening, the inputs provided by the institutions specialist was not well received. Recommendations for transforming SFD into an autonomous authority were not found acceptable and were not discussed with the stakeholders. As a result, concrete advice and implementable time-bound recommendations could not be obtained for establishing self-sustaining institutional arrangements for the government to consider.
Overall Assessment and Rating
In general, the TA contributed in enhancing the skills and exposure of SFD staff in various aspects of project management and implementation. On an overall basis, the services provided under the TA were in line with the terms of reference, produced quality output. There were some areas where the TA consultants could have contributed more significantly. Monitoring and Evaluation. In this context, no concrete steps were taken to transfer knowledge to counterparts in SFD. Institutional Strengthening. Recommendations made in this context were not reviewed with the stakeholders and were therefore not found implementable. On an overall basis, these services were instrumental in providing support to the implementation process and based on the review, the TA is rated as “successful”.
Major Lessons Learned For planning and implementation of all key activities, extensive discussions at all levels are essential. These would contribute in enhancing the acceptability and suitability of the key recommendations.
Counterpart staff resources should be available to facilitate the process of institutionalization and transfer of technology.
A clearly laid out entry and exit strategy is required to enhance the utility of services rendered.
Recommendations and Follow-Up Actions
Considerable work has been done under the TA, and efforts to fully utilize the outputs produced are still required. One particular area is the monitoring and evaluation system. Necessary staff and budgetary resources are required to strengthen the capacity of SFD in this area. This would help in consolidating the data on various Project activities and interventions and would also be of help in providing feedback necessary in the sound management of forest resources under SFD.
Prepared by Ahsan Tayyab Designation Project Economist
43 Appendix 13
ECONOMIC REEVALUATION
A. Factors Considered In Economic Reevaluation
1. Introduction
1. The approach used to calculate the economic internal rate of return (EIRR) was the same as at appraisal, and was in accordance with the Guidelines for the Economic Analysis of Projects, published by the Asian Development Bank (ADB). Assumptions made during appraisal were reviewed and modified in accordance with actual data and experiences.
2. At appraisal, the Project had the following components: (i) social forestry; (ii) reforestation and rehabilitation of Government reserved forests, both in the riverine and inland areas; (iii) institutional support; and (iv) private sector credit. The private sector credit component was canceled after the midterm review. The investment was completed in the Pakistan Government’s fiscal year 2000–2001.
2. Economic Life of the Project
3. The Project’s implementation period, for all components, is 1991–1992 (year 1) to 2000– 2001 (year 10). Its economic life is 1991–1992 (year 1) to 2018–2019 (year 28). The appraisal estimated 28 years as the economic life of the social forestry component, and 25 years for plantations. The shorter life span for plantations was mostly because of the need for topographic and land preparation activities. For this analysis, the time used for topographic land preparation activities is considered part of the economic life; thus, 28 years is used as the economic life for all components.
3. Prices
4. All prices were based on data that private contractors and wood depot owners provided during interviews with the Project Completion Review Mission. The prices quoted are assumed to be good for 2002. The wood product is valued at stump, or the point of harvesting. Based on prices quoted in Karachi, then substracting costs of felling, bucking, sorting, sawing, transport, and profit margin, the financial stumpage prices1 were calculated to be PRs625 per m3 for Acacia nilotica and PRs374 per m3 for Eucalyptus camaldulensis. In accordance with the Sind Forest Department’s (SFD) current system of stumpage sale, the wood products were differentiated only by species and not in terms of the potential use.
4. Production Costs
5. Production costs are derived from project records, and include items paid from loan proceeds and Government contributions. Costs include clearing and leveling of land, irrigation system development, establishment and maintenance of plantations, and Project and institutional support. Costs incurred before 2002 were converted to 2002 constant prices using the gross domestic product (GDP) deflators given in Table A13.1. The costs of replanting and maintenance (Table A13.2) from 2002 onward are based on figures used to prepare the forest management plans for the 14 forestry divisions. Minor adjustments for inflation were made to bring costs to 2002 constant prices.
1 The price of a tree as it stands in the forest or plantation site. 44 Appendix 13
Table A13.1: Indices
Fiscal Year SPI GDP Deflator 1990–1991 42.20 1991–1992 46.65 224.69 1992–1993 51.64 244.17 1993–1994 57.73 275.57 1994–1995 66.40 314.59 1995–1996 73.51 339.89 1996–1997 82.66 385.24 1997–1998 88.74 414.75 1998–1999 94.45 437.59 1999–2000 96.18 449.77 2000–2001 100.92 475.06 2001-2002 103.86 497.14
GDP = gross domestic product ; SPI = sensitivity price index. Source: www.finance.gov.pk
Table A13. 2: Costs of Replanting and Maintenance (PRs/ha)
A. Afforestation Costs Riverine 35,057 Inland 29,554 B. Reforestation Costs Riverine 9,500 Inland 9,500
C. Maintenance Costs Riverine Year 1 2,800 2884 Year 2 4,400 4532 Year 3 4,400 4532 Year 4 and onward 3,500 3605 Inland Plantations Year 1 908 935.24 Year 2 2,500 2575 Year 4 and onward 1,800 1,854
Source: June 2000. Management Plan for Riverine, Inland and Social Forestry Plantations, Hyderabad District. Pakistan. ha = hectares.
5. Products from Plantations
6. At appraisal, it was assumed that plantation-grown timber would comprise 50% fuelwood and 50% industrial wood. Consequently, it was assumed that 50% of the stumpage sale would
Appendix 13 45 be fuelwood, and 50% industrial wood. But until now, no industrial wood has been produced. Almost all the wood from plantations is used either as fuelwood or pit props2 or for use in construction. The present practice is for plantation management to bid out the stumpage, using stacks3 as the unit of measure, and award sale to the highest bidder. The only product differentiation is the distinction among species. The highest bidder or contractor pays for the wood, harvests it, and either transport the cut timber to a wood depot in Karachi where it is sold using the maund (1 maund = 40 kg) as a unit of measure, or sorts and sells the wood personally. Depot owners in Karachi then sort, trim or saw and sell the wood as fuelwood or pit props, or for other purposes.
6. Timber Yields and Rotation
7. Estimated yields of acacia and eucalyptus species in inland and riverine plantations are based on data in the management plans.4 Table A13.3 summarizes the assumptions on yields. The estimated mean annual increment (MAI) per hectare is 390 ft3 or 11.1 m3 for acacia and 544 ft3 or 15.4 m3 for eucalyptus. For social forestry plantations, these figures were adjusted to account for foresters’ field observations. Social forestry plantations yield at least 10% higher because of fertilizers used in agricultural crops.
Table A13.3: Estimated Yield per Hectare
Mean Annual Increment (MAI) Yield at rotation Species CFT/ac/yr CFT/ha/yr m3/ha CFT/ha m3/ha Acacia 150 390.4 11.1 2,732.9 77.4 Eucalyptus 220 543.6 15.4 3,805.3 107.7 ac = acres; CFT = cubic feet; ha = hectares; yr = year. Source:June 2000. SFD Management Plans for Riverine and Irrigated Plantations Pakistan.
8. A 7-year rotation is assumed for acacia. For eucalyptus, 7 years is assumed for the first rotation, and 6 years for subsequent rotations. This is because the second rotation crop of eucalyptus is regenerated by the coppice method.5
7. Annual Cutting Area and Stumpage Volume
9. The stumpage volume to be harvested annually during the period of analysis was determined on the basis of yields given in Table A13.3, and the areas planted during project implementation (Table A13.4). For new plantations in riverine and inland forests, an adjustment was made on the area planted to reflect the success rate6 of plantations. Areas where plantations failed are now being reforested. But it is not clear how successful the reforestation will be, or how soon the entire area will be reforested, considering the drought that the province has suffered for the past 3 to 4 years, and the Government’s budget allocation for reforestation. Present project data indicate a success rate of 55% in inland plantations, and 57% in riverine
2 Pit props are wooden poles used for mining activities. 3 A stack is a pile of wood measuring 5 x 5 x 40 feet or 1.529 m x 1.529 m x 12.192 m. 4 Yield data are based on samples that the Sindh Forest Department measured on plantations in 2000. 5 Coppice is a regeneration method in which sprouts from stumps are nurtured to serve as future crop trees. 6 The Project has classified plantations in terms of tree cover or density. A tree cover of 30% or less is considered a failure.
46 Appendix 13
plantations. For new plantations, only 55% of the area planted in inland and 57% in riverine are included in the analysis (Table A13.5). To minimize yearly fluctuations in volume of harvest, and in cash flow, an area control method of forest regulation was used. For acacia, the total area was divided by seven (the length in years of rotation) to determine the size of annual cutting areas. For eucalyptus, area was divided by six.
Table A13.4: Area (Hectares) Planted or Rehabilitated During Project Implementation
Inland Year Social Forestry Riverine Inland (New) (Rehabilitation) Community Shelterbelt Hurriesa Acacia Eucalyptus Acacia Eucalyptus 1 1991-1992 334 40 40 2 1992-1993 653 145 140 3 1993-1994 1,211 125 127 4 1994-1995 1,727 170 98 111 102 5 1995-1996 2,818 214 88 45 678 169 232 214 6 1996-1997 2,357 106 24 258 1,242 306 830 767 7 1997-1998 4,365 760 360 597 3,395 850 2,100 1,939 8 1998-1999 2,535 40 123 1,307 3,085 770 367 338 9 1999-2000 664 680 175 10 2000-2001 278 520 130 Total 16,000 1,600 1,000 3,149 9,600 2,400 3,640 3,360
a Hurries are private tree plantations, from 1 to 4 ha each, of Acacia nilotica (locally called babul). Source: Sindh Forest Department
Table A13.5: Effective Area (Hectares) Planted or Rehabilitated in Riverine and Inland Forests
Inland (New) Inland (Rehabilitation) Year Riverine Total Acacia Eucalyptus Acacia Eucalyptus 1 1991-1992 2 1992-1993 3 1993-1994 4 1994-1995 111 102 213 5 1995-1996 26 374 93 232 214 939 6 1996-1997 148 685 169 830 767 2,598 7 1997-1998 341 1,872 469 2,100 1,939 6,721 8 1998-1999 747 1,701 425 367 338 3,578 9 1999-2000 380 375 96 851 10 2000-2001 159 287 72 517 Total 1,801 5,293 1,323 3,640 3,360 15,418
Source: Sindh Forest Department.
10. Data pertaining to the aggregate area planted through community forestry were based on records of seedling distribution to participants,7 provided by the Project Management Office. To assess the costs and benefits of maintaining these plantations, areas planted through
7 Estimates are that for 3,000 seedlings distributed, 1 hectare of plantation is established.
Appendix 13 47 community forestry were adjusted to reflect that most participants had already harvested their plantations because of the serious drought, which forced the cutting of trees to make more water available for agricultural crops, and the lack of a viable market for eucalyptus. No data are available on the extent of cutting, but foresters in the field estimate that 80 to 90% of the older community plantations were harvested over the past 3 years. Visual inspection in the field showed that cutting or felling was widespread. In some areas, the land was cleared and leveled after cutting, to replace the tree plantations with agricultural crops. In other areas, but trees were regenerated by coppice. Given the current status of community forestry, this analysis assumes that only 20% of the community forestry plantations will remain after one rotation. The estimated volume of harvest during project period is given in Table A13.6.
B. Economic Analysis
11. The EIRR was calculated on the basis of the costs incurred during project implementation, estimated future costs for replanting and maintenance, benefits to date, and estimated future benefits. Economic analysis was done for each component, and for the entire Project, in constant 2002 prices in Pakistan rupees, using world prices as the numeraire.
1. Economic Costs
12. Project economic costs were estimated by adjusting the financial costs for taxes, opportunity costs of labor, and foreign exchange premium. All taxes withheld by the Project from all contractors were subtracted from actual costs. No other taxes are known to be paid by the Project. Further adjustment was by splitting the costs into local currency and foreign exchange components. Table A13.7 shows the estimated local and foreign currency costs of each component. A standard conversion factor of 0.90 was applied to local costs. For replanting and plantation maintenance costs, the labor component (Table A13.8) was adjusted by applying a conversion factor of 0.75, the estimated shadow price of labor in Sindh. Land used for plantations was assumed to have no opportunity cost. The land under SFD is in forest reserve and therefore cannot be converted to nonforest use. In social forestry, plantings are mostly on the fringes of farmlands; block plantations are on marginal lands.
2. Economic Prices
13. Wood produced through this Project is treated as a nontradable commodity. The economic price is derived in a similar manner as in the financial prices, except that the prices at the Karachi wood depot were adjusted by applying the standard conversion factor (0.90) and the labor component of intervening activities from the Karachi market to plantation sites was expressed in terms of its shadow price. The estimated economic stumpage price is PRs569 per m3 for acacia and PRs339 m3 for eucalyptus.
3. Economic Benefits
14. The economic benefits of the Project comprise the stumpage sale at the rotation period and the wood removed during weeding, cleaning, and pruning on plantations at the end of the second year, every year thereafter until maturity. Foresters in the field estimate that about 4 tons of wood per hectare (ha) is removed during the first maintenance operation, and 2 tons per ha in yearly subsequent operations. Also, a residual value equal to the economic value of yield at rotation age and fuelwood volume from cleaning and weeding operations discounted at 10% is assumed at the end of the Project’s economic life.
Table A13.6: Physical Production
(in ‘000 Cubic Meters) 13 Appendix
Social forestry Inland New Inland Rehabilitation Year Community Total Shelterbelt Hurries Riverine Acacia Eucalyptus Acacia Eucalyptus Forestry 1991-1992
1992-1993 48 1993-1994 1994-1995 1995-1996 1996-1997 1997-1998 1998-1999 39.58 4.74 3.41 47.73 1999-2000 77.38 17.18 11.92 106.49 2000-2001 143.51 14.81 10.82 169.14 2001-2002 204.65 20.15 8.35 8.59 10.99 252.73 2002-2003 333.94 25.36 7.49 3.48 28.94 10.04 17.96 23.05 450.28 2003-2004 279.31 12.56 2.04 11.42 53.03 18.18 40.26 60.33 477.14 2004-2005 525.18 94.80 30.66 20.13 58.53 23.81 43.69 63.51 860.31 2005-2006 315.88 21.92 13.88 21.03 66.89 23.81 46.01 68.95 578.37 2006-2007 28.70 14.81 11.92 23.00 70.87 27.63 51.76 77.57 306.27 2007-2008 40.93 20.15 10.82 25.88 75.25 30.61 57.51 84.74 345.88 2008-2009 66.79 25.36 8.35 26.41 81.32 28.23 61.16 73.16 370.78 2009-2010 55.86 12.56 7.49 27.74 65.50 24.49 49.32 60.33 303.28 2010-2011 111.37 94.80 2.04 22.81 59.40 23.81 40.26 60.33 414.83 2011-2012 75.56 21.92 30.66 20.13 58.53 23.81 40.26 60.33 331.19 2012-2013 28.70 14.81 13.88 20.13 58.53 23.81 40.26 60.33 260.45 2013-2014 40.93 20.15 11.92 20.13 58.53 23.81 40.26 60.33 276.05 2014-2015 66.79 25.36 10.82 20.13 58.53 23.70 40.26 60.33 305.91 2015-2016 55.86 12.56 8.35 20.13 58.53 23.70 40.26 60.33 279.72 2016-2017 111.37 94.80 7.49 20.13 58.61 23.81 40.26 60.33 416.80 2017-2018 75.56 21.92 2.04 20.09 58.61 23.81 40.26 60.33 302.62 2018-2019 28.70 14.81 30.66 20.13 58.53 23.81 40.26 60.33 277.23 Total 2,706.56 605.55 245.01 342.91 1,028.14 400.84 738.59 1,065.59 7,133.18 49 Appendix 13
Table A13.7: Percentage of Local and Foreign Costs by Component
Local Cost Foreign Cost Component (%) (%) Social Forestry 80 20 Plantations 41 59 Riverine 39 61 Inland (new) 39 61 Inland (rehab) 52 48 Institution 60 40 Total Base Cost 50 50
Source: Asian Development Bank Records.
Table A13.8: Labor by Activity
Activity Amount A. Reforestation Costs Riverine 81% Inland 81%
B. Maintenance Costs Riverine Year 1 29% Year 2 52% Year 3 53% Year 4 and forward 39%
Inland Plantations Year 1 88% Year 2 94% Year 3 96% Year 4 and forward 64%
4. Economic Internal Rate of Return
15. Based on the foregoing assumptions, Table A13.98 gives the net economic benefits of the base run. The EIRR is 9% for the entire Project. The EIRR for each component is: social forestry, 22%;9 riverine plantations, 0%; inland (new plantations), 1%; and inland (rehabilitated plantations), 15%.
8 The sharp decline in the net economic benefits for social forestry from year 10 onward is linked to the withdrawal of 80% of the production area of plantations. 9 The EIRR for the social forestry component is relatively high because of its significantly lower costs of plantation establishment and maintenance, and more productive land resources. 50 Appendix 13
Table A13.9: Net Economic Benefit
Social Inland Year Riverine Inland New Total Forestry Rehabilitation 1991-1992 (4,876) (2,551) (10,187) (2,304) (19,918) 1992-1993 (13,835) (5,213) (20,819) (4,708) (44,575) 1993-1994 (28,129) (8,905) (35,565) (10,309) (82,908) 1994-1995 (22,058) (11,168) (36,221) (7,647) (77,095) 1995-1996 (31,453) (16,213) (71,942) (9,302) (128,910) 1996-1997 (31,527) (13,385) (84,968) (22,285) (152,165) 1998-1999 (16,284) (38,825) (148,838) (13,065) (217,012) 1999-2000 36,264 (22,789) (61,846) 5,899 (42,471) 2000-2001 57,804 (12,003) (44,837) (636) 328 2001-2002 89,681 (4,318) (3,988) 1,783 83,159 2002-2003 131,800 (2,021) 13,689 10,377 153,845 2003-2004 103,639 2,523 29,074 31,916 167,153 2004-2005 224,685 8,344 33,594 36,502 303,125 2005-2006 120,781 8,529 36,183 40,329 205,822 2006-2007 23,462 9,171 39,360 45,586 117,579 2007-2008 27,741 10,022 42,076 50,664 130,504 2008-2009 35,932 9,979 45,089 47,828 138,829 2009-2010 27,845 10,661 35,192 36,739 110,437 2010-2011 69,510 8,017 31,585 31,587 140,700 2011-2012 48,722 6,488 31,097 31,587 117,895 2012-2013 23,771 6,487 31,098 31,587 92,943 2013-2014 28,565 6,488 31,096 31,587 97,736 2014-2015 37,254 6,487 31,067 31,587 106,396 2015-2016 28,274 6,487 31,069 31,587 97,417 2016-2017 72,422 6,486 31,134 31,587 141,629 2017-2018 33,497 6,470 31,132 31,587 102,687 2018-2019 187,499 56,338 206,676 203,322 653,835
EIRR 22% 0% 1% 15% 9%
EIRR = economic internal rate of return. Source: Project Completion Report.
16. The EIRR at Project completion is significantly lower when compared to its value of 20% at appraisal. The significant reduction is mainly attributable to: (i) reduction of the estimated MAI of acacia10 from 25 m3 per ha per year at appraisal to 11.1 m3 at completion (a 56% reduction); and for eucalyptus, from 18 m3 to 15.4 m3 (a 14% reduction; (ii) overly optimistic prices assumed at appraisal;11 and (iii) failures in new plantations, in both the riverine and inland areas.
10 About 74% of all project plantations are acacia; only 26% is eucalyptus. 11 At appraisal, the average economic stumpage prices (at 2002 constant prices) were PRs927/cu m for acacia and PRs442 for eucalyptus. At project completion, stumpage prices were PRs569/cu m for acacia and PRs339/cu m for eucalyptus.
Appendix 13 51
5. Sensitivity Analysis
17. Sensitivity tests were used to assess the Project’s economic viability under a range of changes in key variables affecting project costs and benefits. Table A13.10 summarizes results of the sensitivity analysis.
Table A13.10: Project Economic Internal Rate of Return and Sensitivity Analysis (%)
Overall Social Inland Inland Riverine Change in Value of Variables Project Forestry (new) (Rehab) EIRR EIRR EIRR EIRR EIRR 1. Base Case 9 22 0 1 15 2. Increase in Costs (10%) 9 25 0 1 14 3. Decrease in Prices (10%) 9 25 0 1 15 4. Reduction in Yield (10%) 8 23 (1) 0 13 5. Increase in Yield (10%) 10 26 1 2 16 6. Increase in Yield (20%) 11 28 2 2 17 7. Increase in Yield (50%) 14 32 4 4 20 8.Increase in Yield (Appraisal level) 14 28 8 7 21 9. Price at appraisal level 13 29 5 5 19 10.Yield and Price at appraisal level 19 33 12 11 27
EIRR = economic internal rate of return
18. Results indicate that a 10% increase in costs will reduce the overall EIRR by 1%. On the other hand, a 10% decrease in price will not change the EIRR. The Project’s viability appears to be sensitive to changes in yield estimates. A 10% reduction in yield reduces the overall EIRR by 2%, while a 10% increase results in a 1% increase in Project EIRR.
19. To determine the impact of yield in the reduction of Project EIRR from 20% at appraisal to 9% at completion, the yields at appraisal were substituted in the analysis. This resulted in a Project EIRR of 14%. Furthermore, by using the economic prices (expressed in 2002 constant prices) and the projected yield at appraisal, the Project EIRR increased to 19%.
20. The foregoing analysis indicates that the significant reduction in the Project EIRR is mainly due to (i) over-optimistic estimates of the yield of acacia (25 m/ha per year at appraisal versus 11.1 at completion) and of eucalyptus (18 m/ha/yr at appraisal against 15.4 at completion); and (ii) the anticipation that industrial wood would be produced, which would significantly raise the estimated average economic price of stumpage. Other factors that may have caused the EIRR reduction were the delay12 in the stream of benefits by at least 2 years, and plantation failures (43% in riverine and 45% in inland plantations) caused by drought, saline soils, and improper land preparation.
12 The sensitivity analysis conducted during appraisal indicated that a 2-year delay changed the EIRR from 20% to 15%.
52 Appendix 13
C. Employment Impacts and Other Benefits
21. Besides the economic benefits included in the analysis, the Project will also have significant employment and other benefits. These benefits are not included in the FIRR and EIRR calculations because their valuation in financial and economic terms is not feasible at this time.
1. Employment Impacts
22. The Project is expected to generate employment opportunities through different components, including nursery establishment and harvesting. During implementation, the Project was estimated to have provided employment equivalent to 12,632 person-years, or the equivalent of 1,263 full-time jobs. For its remaining economic life, the Project is expected to generate about 74,691 person-years of employment, or the equivalent of employing 4,150 persons full time.
2. Other Benefits
23. Although some 6,700 ha of plantations are considered failures and thus, not included in this analysis, irrigation structures are still in place. Some of these areas can be brought back to production if funds and irrigation water are made available.
24. The productivity of farmlands of farmers who participated in the social forestry component of the Project is perceived to have increased. While this remains to be confirmed,13 forest officers in the area believe that productivity has increased as much as 10% as a result of shelterbelts established to protect agricultural crops from strong winds and severe temperatures. The hurry, or private woodlot, system has the potential to improve soil fertility because of the nitrogen-fixing ability of Acacia nilotica, the tree species planted in hurries. Keerio and J. H. Ehrenreich14 reported increases in wheat yields as high as 20% after one hurry rotation.
25. The Project has increased environmental awareness of farmers and other stakeholders who participated, thereby enhancing SFD efforts to protect and manage its plantations. Some educational institutions are now using the guidelines on social forestry prepared through the Project in courses in agriculture and social forestry.
26. The Project has had significant impacts on SFD’s institutional development. It has greatly improved institutional capacity by providing training to SFD officers, plus buildings, vehicles, a geographic information systems laboratory, equipment, research facilities, and consultancies. Besides providing 100 incremental staff, a total of 75 person-months of local training and 43 person-months of overseas training were provided to SDF staff; and farmers received the equivalent of 400 person-months of training. Similarly, the Project provided infrastructure, vehicles, and motorcycles. The preparation, and later implementation, of management plans for the 14 divisions also provided an excellent exercise for the entire SFD to work together in placing Sindh’s riverine and irrigated plantations under sustainable forest
13 May 2000. Benefit Monitoring and Evaluation Study, Sindh Development Studies Centre, University of Sindh, Jamshoro, Sindh. 14 Keerio, G. R., J. H. Ehrenreich and R. L. Mahler (1993). “Acacia nilotica Hurry Agroforestry System: Effect on some physical and chemical soil properties” Proceedings, Third North American Agroforestry Conference, 16-18 Aug. 1993, University of Idaho.
Appendix 13 53 management. Combined, these benefits have increased SFD institutional capacity, and boosted confidence in implementing province-wide projects.
27. Finally, through the Project, SFD has formulated forest management plans for riverine, inland, and social forestry plantations for all 14 forestry divisions across the entire province. This is considered a “first” for Sindh province. This is a big step toward putting the plantation forests of Sindh under sustainable management.
54 Appendix Appendix 14
PROJECTED HARVESTS, COSTS, AND INCOME FROM THE SINDH FOREST DEPARTMENT’S PLANTATIONS COVERED BY THE 14 MANAGEMENT PLANS
Area (ha) Volume ('000 m3) PRs (million) Year Riverine Inland Total Area Riverine Inland Total Vol. Costs Income
2001–2002 5,026 1,926 6,953 253,216 148,043 401,258 170.120 135.481 2002–2003 5,061 2,361 7,422 240,418 168,143 408,561 175.466 151.147 2003–2004 5,006 2,068 7,074 239,460 171,236 410,696 179.956 154.804 2004–2005 4,903 2,340 7,243 242,052 178,629 420,680 185.230 155.214 2005–2006 5,835 3,023 8,857 234,077 222,257 456,334 180.144 175.733 2006–2007 5,591 2,673 8,264 238,118 235,130 473,247 172.484 177.292 2007–2008 6,694 3,275 9,969 257,721 305,896 563,617 186.547 209.571 2008–2009 5,670 4,372 10,042 256,650 385,639 642,289 173.031 266.865 2009–2010 6,182 4,199 10,381 258,158 366,152 624,310 157.054 258.764 2010–2011 6,720 4,591 11,312 259,431 364,327 623,758 157.206 261.207 Total 56,689 30,828 87,517 2,479,299 2,545,452 5,024,751 1,737.238 1,946.078
Average (Annual) 5,669 3,083 8,752 247,930 254,545 502,475 173.724 194.608
ha = hectares. Sources: Management Plans of 14 Forestry Divisions.
Appendix 15 55
FOLLOW-UP ACTIONS AND RECOMMENDATIONS
Project- Analysis Action Responsible Time Frame Specific Issues Agency Future Monitoring
Monitoring of The preparation of the SFD, through its SFD Within 2 years implementation forest management conservator of of management plans for the forests for plans sustainable research, management of planning, and Sindh’s forests has monitoring and been completed with evaluation, assistance provided by should initiate the this Project. Although preparation of a this is an important plan for condition for monitoring and sustainable evaluation of management, it is not management sufficient. An effective plan monitoring and implementation evaluation system within the next 2 should also be in years. place. A good monitoring and evaluation system will provide the Sindh Forest Department (SFD) essential information on how well the plan is being implemented, and problems that are being encountered. This information will also provide a basis for determining actions to keep the plan implementation on track.
Monitoring could focus Considering the on the major inputs importance of and outputs of plan monitoring and implementation. evaluation Appropriate indicators information, this could be selected to should be given provide some priority in the measures on the allocation of
56 Appendix 15
Project- Analysis Action Responsible Time Frame Specific Issues Agency progress of future funds. implementation. For example, inputs could be measured in terms of personnel and budget required for the given period vs what are actually provided. Outputs could be measured in terms of volume of stumpage planned to be harvested vs volume actually harvested; or areas of plantation planned to be replanted vs areas actually replanted. Such indicators could provide clues on how effectively the plans are being implemented and provide early warning signals for potential problems. The data gathered will also serve as a basis for updating the management plans Documenting Records show that SFD should SFD A monitoring lessons participants in this monitor, on a program learned from component have periodic basis, should be social forestry developed 18,600 ha the status of a operationalized of plantations, either as representative immediately. block plantations, line sample of social plantings, shelterbelts, forestry or hurries. Considering plantations that this component developed was expanded to cover through the the whole province, Project. this component could have tremendous impact in increasing forest cover and bridging the gap between supply and demand for wood in Sindh. Monitoring all participants in this
Appendix 15 57
Project- Analysis Action Responsible Time Frame Specific Issues Agency component would be expensive and difficult, so it is important to periodically gather representative samples of data. Such monitoring could provide documentation of lessons learned and other information that may be useful to SFD in the design of its own projects or programs. The network and linkages that have been established also provide SFD opportunities to work with local people closely, and tap their power in the sustainable management of forest reserves.
Covenants
Self-financing The issue of self- The Government SFD, the 30 June 2003 system financing fund has of Sindh has Planning and been raised in almost agreed to Development all review missions. As establish a Department, of today, this covenant steering the remains to be complied committee to Economic with. The rationale for facilitate approval Affairs this covenant is to of this long- Division, and provide sufficient funds outstanding ADB for the post-Project covenant by 30 maintenance of June 2003. plantations established Close monitoring through the Project. will be required The covenant requires both by the Asian that at least 50% of the Development revenues generated Bank (ADB) and from these plantations SFD to ensure shall be placed into the that the system. With this Government system in place, these provides funds plantations can be needed to managed on a self- implement the
58 Appendix 15
Project- Analysis Action Responsible Time Frame Specific Issues Agency sustaining basis. management plans for all 14 forestry divisions.
Other follow-up actions
Establishing a The anticipated market SFD should SFD Within the next network or for eucalyptus timber actively pursue 2 years linkages with did not materialize. As building up a wood a result, the current network with industries price of eucalyptus wood-based wood is far lower that industries was anticipated. In the absence of processing plants for eucalyptus timber, other potential industrial users should be explored. Constant interaction with these industrial users will provide a better understanding of the state of the industry and their requirements. This would help SFD in reforestation planning and in the establishment of linkages among communities and potential industrial consumers of plantation products. Some specific measures in small- scale wood processing could be investigated, including portable saw mills. Visits could be arranged to countries such as the Lao People’s Democratic Republic, where such small-scale wood processing plants are functioning.
Appendix 15 59
Project- Analysis Action Responsible Time Frame Specific Issues Agency Replanting of The decision to replant Assess failed SFD Assessment to failed areas the failed areas should areas and be completed be primarily based on explore by 2004 the additional costs possibilities of involved and the associating with assessment of the local possibility of putting in communities in place a successful their plantation regime. development. SFD should take the lead in realistically assessing potential sites with emphasis on environmental considerations such as soil properties, and availability of water. Possibilities of associating the communities and interested farmers should also be explored in cases where the potential of growing agricultural crops along with forest species can be demonstrated. This program of site assessment which is already underway in selected areas, should be completed by June 2004 so that budgetary allocations are presented to the Government for financing. The immediate priority should continue to be areas already developed to minimize replanting costs, and staying within the Government’s budgetary constraints.