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World Bank Document Document of The World Bank . .. FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No. 4645a-IND STAFF APPRXAISALREPORT Public Disclosure Authorized INDONESIA SECOND SWAMPRECLAMATION PROJECT Public Disclosure Authorized May 7, 1984 Public Disclosure Authorized Projects Department East Asia and Pacific Regional Office This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCYEQUIVALENTS US$1.00 1,000 Rupiah (Rp) Rp 1,000 = US$1.0 Rp 1 million = US$1,000.00 WEIGHTS AND MEASURES - METRIC SYSTEM 1 millimeter (mm) = 0.039 inches 1 meter (m) = 39.37 inches 1 kilometer (km) = 0.62 miles 1 square kilometer (sq m) = 0.386 square miles 1 hectare (ha) = 2.47 acres 1 cubic meter = 35.31 cubic feet 1 million cubic meter (MCM) = 811 acre feet 1 liter (1) 0.264 gallons (USA) 1 liter/second (1/sec) = 0.035 cubic feet per second 1 kilogram (kg) = 2.2 pounds 1 metric ton (ton) - 2,205 pounds INDONESIAN FISCAL YEAR April 1 - March 31 ABBREVIATIONS AARD - Agency for Agricultural Research and Development, MOA BIMAS - Bimbingan Massal Swa Sembada Bahan Makanan - Mass Guidance for Self-Sufficiency in Foodstuffs, a farm input-credit pakage program BRI - Bank Rakyat Indonesia - People's Bank of Indonesia BULOG - National Food Procurement and Distribution Agency BUUD/KUD - Village Unit Cooperative DGA - Directorate General of Agrarian Affairs (Cadastral Office) DGFCA - Directorate General of Food Crops Agriculture DGWRD - Directorate General of Water Resources Development, MPW DGSP - Directorate General of Settlement Preparation, MOT DGMG - Directorate General of Mobilization and Guidance, MOT DOS - Directorate of Swamps, MPW DPMA - Directorate of Hydraulic Engineering, DGWRD DPU - Departemen Pekerjaan Umum - Ministry of Public Works (MPW) FSRP - First Swamp Reclamation Project GOI - Government of Indonesia FOR OFFICIALUSE ONLY ICB - InternationalCompetitive Bidding IPB - Institut Pertanian Bogor - Bogor Agricultural University IPEDA - Land Tax INSUS - Credit Program for Farmer Groups Participatingin Crop Intensification ITB - Institut Teknologi Bandung - Bandung Institute of Technology LCB - Local Competitive Bidding MOA - Ministry of Agriculture MOC - Ministry of Cooperatives MOH - Ministry of Health MOT - Ministry of Transmigration MPW - Ministry of Public Works O&M - Operation and Maintenance P4S - Proyek Pembukaan Persawahan Pasang Surut - Project Unit for Tidal Swamp Reclamation P3S - Proyek Pengairan Pasang Surut - Project Unit for Tidal Swamp Reclamation and Irrigation PLP - Directorate of Land Preparation for Transmigration PPL - Village Level Extension Workers PPM - Mid-level Agricultural Extension Workers PPS - Subject Specialists, Agricultural Extension PPW - Provincial Public Works REPELITA - Rencana Pembangunan Lima Tahun - Five-Year Development Plan SSRP - Second Swamp Reclamation Project GLOSSARY Hak Pakai - Individual Right of Use of Exploitation of Assigned Land Hak Milik - Right to Full Ownership of Land Jawa - Java Kabupaten - District Kakanwil - Provincial Director Kecamatan - Subdistrict Marga - A Community Grouping Under Traditional (Adat) Law PUSKESMAS - Community Health Center Sumatera Selatan - South Sumatra This document has a restricteddistribution and may be used by recipientsonly in the performanceof | their official duties. Its contents may not otherwisebe disclosedwithout WorldBank authorization. INDONESIA SECOND SWAMP RECLAMATIONPROJECT Loan and Project Summary Borrower: Republic of Indonesia Amount: $65.0 million (includingcapitalized front end fee) Terms: Repayable in 20 years, including 5 years of grace, at the standard variable rate. Project Description: The proposed project, the second Bank-assistedswamp reclamation project, focusses on strengtheninginstitutions implementingthe Governmentof Indonesia's (GOI's) program of swamp development. The project will also help finance a six-year time slice of an eight-yearprogram of reclaiming and developing about 30,000 ha of swamplandsin South Sumatra and settling about 11,500 families in the newly developed area. Project works will comprise the entire primary and secondary drainage infrastructure,about 60% of tertiaries, about 40% of on-farm works in the 30,000 ha development,and all houses and settlement. GOI will complete the remaining reclamationworks by end-1991. In addition,master plans will be prepared for future swamp reclamationschemes and feasibilitystudies and detailed designs will be prepared for upgrading some older schemes developed to minimum standards by GOI, a selected number of which will be upgraded. Tech- nical assistancewill be provided to agencies engaged in project preparation and implementation. Agricultural research for swamp developmentwill be expanded in South Sumatra and South Kalimantan and extension services will be improved, especially in pest control. The developmentof 30,000 ha will benefit directly 11,500 mostly-landless families from Java and Bali to be settled there /1 and increase paddy production by about 58,000 tons a year at full development. The main risks in swamp reclamation schemes are slow start up, slow implementationand delayed agricultural development. Project formulationreflects the experience gained in the first Bank-assistedswamp reclamationproject (FSRP, Loan 1958-IND) in improving the quality of works and increasing implementationefficiency, and the experience gained in ongoing GOI schemes on land and agricultural development. The rate of farm developmentassumed in project analysis is conservative,derived from achievementsin the ongoing program. /1 Up to 15% could be local families wishing to settle in the project area. Estimated Costs:/a Local Foreign Total …------- $ million ------- Reclamation and Settlement Civil works 13.7 13.4 27.1 Transmigration 17.3 5.6 22.9 Subtotal 31.0 19.0 50.0 Institutional Support Consultants 2.8 6.3 9.1 Training - 0.2 0.2 Equipment 0.1 4.2 4.3 Well drilling and testing - 0.1 0.1 Test farms and facilities 0.5 0.3 0.8 Subtotal 3.4 11.1 14.5 Engineering and Administration 5.3 - 5.3 Base Costs 39.7 30.1 69.8 Physical contingencies 6.2 4.6 10.8 Price contingencies 20.1 7.6 27.7 Total Project Cost 66.0 42.3 108.3 Front-end fee - 0.2 0.2 Total Financing Required 66.0 42.5 108.5 Financing Plan: Bank 22.5 42.5 65.0 Government 43.5/b - 43.5 Total 66.0 42.5 108.5 /a Includes taxes on civil works of $1.3 million. All figures rounded off to nearest decimal . /b In addition, GOI will finance an estimated $12.3 million to complete all project works not included in the six-year time slice. - iii - Expected Disbursements: Bank FY 1985 1986 1987 1988 1989 1990 1991/a Annual 2.0 6.0 15.0 15.0 12.0 7.0 8.0 Cumulative 2.0 8.0 23.0 38.0 50.0 57.0 65.0 Rate of Return: 12.5% on reclamationand settlement./b The ERR of insti- tutional support cannot be quantified. Staff Appraisal Report: No. 4645a-IND, dated May 7, 1984. /a The project will end in 1990. However, disbursementsare expected to continue into 1991. /b About 74% of the total project cost. INDONESIA SECOND SWAMP RECLAMATION PROJECT Table of Contents Page No. I. BACKGROUND General ...........................................................1 The Agricultural and Rural Sector ......... ... ............. 1 Transmigration ..................................................0..... 2 Swamp Reclamation and Development ..... ..................... 3 Project Formulation and Design ........... e.... .............. 7 II. THE PROJECT AREA Location ..........................................................10 Climate .......... 10 Topography and Soils ........... ......................................11 Hydrology and Hydrometry ..... ............................. 11 Forest Cover ...............................................12 Current Land Use ............ ............................... 13 Population .........................................................13 LandTenure .............................................. ... 14 Access, Services and Existing Developments ................. 14 Reclamation Schemes near the Project Area .................. 15 III. THE PROJECT Objectives .......... ......... 0.......... 16 General .......................................................... 16 Detailed Features of Reclamation ...............O- . 16 Detailed Features of Settlement ......... ................... 19 Institutional Support .... ............... ........ .......... 21 Status of Field Data, Planning and Design ............. .. .... 22 Implementation Schedule .... ...... ............................23 Consulting Services ...... ..... ................................ 23 Cost Estimates .............. $..*...................................... 26 This report is based on the findings of an appraisal mission composed of Messrs. I. Naor, H. Matheson and P.C. Sun (Bank) which visited Indonesia in April 1983. - ii - Page No. Financing ..................................................26 Procurement ................................................ 27 Disbursements ..............................................28 Accounts and Audits . ....................................... 28 Environmental Effects ....... ...............................30 IV. ORGANIZATION AND MANAGEMENT Executing Agencies and Coordination . .............. 30 Agricultural Support ..................................... 32 Operation and Maintenance (O&M) . ..........................35 Monitoring and Evaluation .......................... 36 V. AGRICULTURAL PRODUCTION
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