MAHAWE L I AUTHORITY OF S R I L AIKA BRIEF OX ACCELERATED L4AHAWELI PROGRAMME Monitoring and Progress Control Unit October 1980. PAl' t o ]9 1 , !'e f i L.iit ;, ,:.+ t'!': '11 .'(];,1:1 A I,-tI Ill tlkilliOrll. in It.. economli c fortirnee,. Growth *e.ii.. i -ttiil(d iind h,.r- wer,0 loW .level, 0l Irlveo:tnient . 'Ph, re at vely :l o:ed uconomy , wi th art 'icia]ly admni:iter.ud price!; which did iot ri Icl true co. to!,led to production distortions and a heavy recurreit .;ubsdv burden for the Government. Agriculture, which accounted for one third] of' the gross domestic produJct, was; unable to meet the local demand for food staples such as rice and sugar; the deficits having to be made up by importations from abroad. Unemployment, at around twenty percent, constituted a major social and economic problem, particularl'y as a (unsiderable proportion of those without. Jobs wer. educated young people. There was a serious shortage of exper enced managerial and profo;s ional manpower, created to a large extent by the fUinarieal atrra;tiozin: ol the oil-r ch countries of the Middle East. Ir 1977, laced by thee problem,, the newly elected Government introduced major p, licy innovations aimed at renedyirg the situation. These were ;- Higher private sector involvement in economic development Realistic pricing to reduce the subsidy burden Devaluation of the rupee Acceleration of the Mlahaweli Development Scheme Creation of the Colombo Free Trade Zone Although there is no suggestion that all of Sri Lanka's problems will disappear overnight, there is evidence that this new approach is having the desired effect. The Annual Report of the Central Bank of Ceylon for 1979, in its review of the economy states, "The Sri Lanka economy recorded a growth rate of 6.2 percent in 1979, a rate unsurpassed in the last decade, except in 1978. This achievement, though lower than the impressive growth of 8.2 percent in the previous year, was an indication that the growth imptl I ses whI ,hI (r(, g, Ic 1, 'd I ['. UtI mcaII, L,'.JI I jl ,ic1t l*j Vm:; ,'.,, I have been susta innd. Unenp I oym1ntIt has I'IenI5 UentFZ pe11 t o(' the work f'orce and the per capita income ros- from 160 Unitd E'Lates Dolla rs in 1977, to 217 United States Dollars in 1979. Although the expansion of the economy has been broader based than in the pre-I iberal ;sation era, agriculture still retains a dominant position in the composition of the Gross Domestic Product. The performan~ce of the agricultural sector however, has been uneven. Rice declined as a percentage of total import,, from 1b percent in 1977 to 4 percent in 1979 but in the latter year, the actual quantity of rice imported increased by 13 percent over 1978 and in terms of overseas exchange, cost an additional 195 million rupees. The Central Bank states that an overall decline in the annual prodution (if rice wa:; only averted by the considerably improved performance of paddy grown under major irrigation schemes, underscoring the importance of irrigation and water. management in future development. A further factor was the sharp rise in the cost of petroleum imports over recent years which has made the development of alternative domestic sources of energy imperative. This, coupled with the need for food import substitution creates an economic context within which, the Accelerated Mahaweli Development Programme assumes a key position in the'Government's economic strategy. The Mahaweli qanga is the longest river in Sri Lanka, rising in the Central mountains it flows north and east to reach the sea near Trincomalee. The river basin, along with that of its main tributary, the Amban Ganga covers an area of 10,400 square kilometres - 4000 square miles ­ of the dry and intermediate rainfall zones. What makes this area of such key importance is that it constitutes the largest remaining unexploited irrigation and hydro­ power potential in the country. lilIn ' 1', ra'ztk,1-d * ,, L !A e wil t,I,,t;.111 " ,a' I .:,JI"i , deve]upment pl an ol* t le thawli i hsi ,;lW:; p tp.ila- i i 1i ) ) /196,). This was ful I owt.d by a Food and Agricul ture Organi:on ti n/Un i ted Nali tn! Developmeit l'rogramrrr2 .1tudy over the period 1965 to 1968 whiceh culmina ted in the prodoction of the M;o.;tor Plan which has been the basis of all subsequent work. The development obje(cLives of' that plan were firstly, to raise agricultura] production, espe,-ially that of rice, to help attain self-sufficiency and, if'possible, produce a surplus for export; secondly to create employment opportunitic,;; and thirdly, to generate hydro-electric power to meet the increasing demand fcr e eetricit.y. The plan envisaged the development of 364,000 hoctarci. - 900,000 acres of irrigated agricultural land and 500 megawatts of hydro-power within a t:ime framework of thirty years. Implementation atf the plan commenced in 1979 aind proceeded at a relatively leis~ure(ly pac-. 'l'hc P geloIla and Bowatcnnc divursion and the Ukuwela hydro­ power station of' 40 megawatts were completed, while the Bowatenne tunnel and hydro-power station of 40 megawatts are now nearing completion ten years later. Irrigation System H, the agricultural area using water diverted at Polgolla, is scheduled for final completion and full settlement by th end of 1981. The incoming Government's Accelerated Programme has been set to cover a period of six years during which, Systems A, B, C and D covering approximately 125,000 hectares - 310,000 acres - and five major storage projects, Victoria, Kotmale, Randenigala, Maduru Oya and Ulhitiya/Ratkinda are scheduled for completion. Within this list, priority has been accorded to the development of Systems B and C, and the Victoria, Kot.iale and Maduru Oya projects. In addition, irrigation to a further 16,000 hectares of cultivated land is to be improved and the Systems in which construction was already in progress are to be completed. The, Aceeae aawli rgam is thie l1argest itnvestmentprjc i ever.'formutlated by th Goenet fSiLna.'ota1ivsmn costst excldin'toseforthe'AMoragahakanda Prjet, the future of~which,,depends :'pon hie outcome iof the Trans -Div ersion; Study~presently~being' commissioned'"' ,with the assistance ofteWrd an,.a,17 prices,,are estzimated to be~ 2 550 illjion rupees.:,As,,of the endofKlast Ayear, :the cunuativetexcpenditur~e to'-date, amunte, 0 772 milio u~s 9 milion rupees of,,thiIsAbeng '1979 iLtse' . The Piogramme~will absorb appro mtely 30 percent of >the 'public,sector investment programme and as, sucho is a significant./ measure of~the Government's' coiwit ment~to the project and' its determination Sthat' it must succeed. AThe development and operation of the project is. Sexpected 'to have an 'important imato h hoeSiLnaecnm n ae a substantial contribution to the growth" of this country.' To methanpwradfnnildmnso h ceeae rgam Todemeesthey manpoer andori finanldead the aceeloperatd of Sysgtem~C''A. withn thenew tim scalie; assiancfe hbenre mellionfomnd friedlying se Germconrie and theinterandatna leninb en ce. HappilyGthisnhelp hfJasen A redlyfrtcm:gThe'a n oe-ntUom KsbingmeOveras Deveopmeds.minisrtoA,'A t4 fundedn'anstd otates Volrri r antan tedwnrem develpmenha ofmmystednCAA'AA~ n~Aa nduvas agr e toprovind enra llofonhundan Dol pouns strlngIo U" ords theinp812'ictioan of tthreda,nd'Hyro-power. sheme. 1AIn the IanAA St f 11,'Ad A~~~manner,th feaibiit~ ~nelstde of*thtadngaaRsroir and1th deveop All inii I, ai cIli (:i Iy] LO (,If Lta I I li U i (* :',112rt(i ;; Jul :.0; b wig provided by JlAIIt toth' n de:;ign:;, tunoer (ocLJm(Ot.8: and clown.;tr am irrigation work:s fUr Systum I, %i:ith an additional concessionary loan in tile amount, of 85 million dollar.-; being earmarked to finance the construction of these works. Thu Netiler land:; provided grant funds fur the implementation strategy study and the hydrological Crash Program. The Asian Development Bank, European Economic Community, World Bank and United Nations Development Programme are funding consultants to assist in preparation, review, planning and various other as;pect.s- of" the Programme. The Accelerated Programme is therefore truly intrnaLional . Nor i; tile country totally dependent upoi out.saide help but is usiing. I()cal funds to meet shortfalls in foreign assistance, the re;toration of' village tanks and all project local costs. Such a complex programme require!; a well structured management organisation with all of the necesary power and authority to control and direct the multipl :7i ty ()f tut.on,;, con!;ultants_i't and agencies involved. Originally, the programme' wa.s the respun;ibility of the Ministry of Irrigation, Power arid tighiay. but. 1ollowing a'iinisterial restructuing in 1978, the Accelerated Programme became a separate Ministry of Mahaweli Development and part of the portfolio assignment of the Minister of Land and Land Development. T1,'3Ministei thus combines political responsibility for the key Departments of Land, Settlement, Surveys, Forestry and Irrigation, with that of implementing the Accelerated Programme of Mahaweli Development. The principal component of the Ministry of Mahaweli Development is tile Mahaweli Authority of Sri Lanka, established by legislation in April 1979 and charged with overall policy determination and financial control of tile Mahaweli Programme. All funds voted for the Programme by Parliament, International aid and borrowings, are credited to the Mahaweli Authority Fund for disbursemen by the Authority. The Authority has a five member Board comprised of tile - 6 - Cha it'siuai/ ij i , i-C, -, 'i: , :;:- ,' t'1t I 7 y ,f Viilict aintd the M(ii o1Ma):tI'y we I iCVe-Iupri"t arid V; ,cut!X iv,C1)irec t~r-; res;pn)rs bit.