World Bank Document

Document of The World Bank

FOR OFFICIAL USE ONLY

Report No. 7579 Public Disclosure Authorized

PROJECT COMPLETIONREPORT

Public Disclosure Authorized *-NDIA

SECOND FOODGRAINSTORAGE PROJECT 'CREDIT 747-IN)

DECEMBER 30, 1988 Public Disclosure Authorized

Country Department1V Asia Regional Office Public Disclosure Authorized

Thisdocument hasa restricted distribution and may be used by recipients only in theperformance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. ABBREVIATIONSAND ACRONYMS

ARDC - AgriculturalRefinance and DevelopmentCooperation ASCI - AdministrativeStaff College of India, Hyderabad CAP - Cover and plinth (Baggedgrain placed on brick plinth and covered with polyethylenesheets) CRORE - 10 million CSS - Central Storage Committee CWC - Central WarehousingCorporation EGS - Employment Guarantee Program FCI - Food Corporation of India FPS - Fair Price Shops GOI - Government of India IR - Indian Railways IRR - Internal Rate of Return ITDP - IntegratedTribal DevelopmentProject LAKH - 100,000 MICB - Management Information and Control Branch - of FCI NREP - National Rural Employment Program PCR Project CompletionReport PDS - Public Distribution System PID - Project Implementation Division - of FCI RLEGP - Rural Landless EmploymentGuarantee Program RS - Rupee SWC - State WarehousingCorporation

INDIAN FISCAL YEAR

April 1 - March 31 FOR OFFICIL USE ONY THEWORLD SANK Washington.D.C. 20433 U.S.A.

Oikceof Dmimtv.nal OpratuamEVA"iutim

December 30, 1988

MEMORANDUMTO THE EXECUTIVE DIRECTORS AND THE PRESIDENT

SUBJECT: Project Completion Report on India Second Foodirain Storage Proiect (Credit 747-IN)

Attached, for information, is a copy of a report entitled 'Project Completion Report on India Second Foodgrain Storage Project (Credit 747-IN)" prepared by the Government of India, with an ovevriew memorandum prepared by the Asia Regional Office. Full evaluation of this project has not been made by the Operations EvaltLation Department.

Attachment

This documenthas a sricted distributionand may be usedby recipientsonly in the performance of their officialduties. Its contentsmay not otherwisebe disclosed without World Bankauthorizatin. FOROMCIL USE ONLY

INDIA

SECOND FOODGRAINSTORAGE PROJECT (CREDIT 747-IN)

Project CompletionReport

Table of Contents

Page No.

Preface...... ii Basic Data Sheet...... iv-v EvaluationSummary .... vi Ovevvierview...... viii

I. INTRODUCTION...... 1

II. FOOD SECURITY PERSPECTIVE...... 2 b III. PROJECT IMPLEMENTATION......

Original Project Content...... 17 Start-up Period ...... 17 Revisionsin the Scope of the Project Content...... 18 Final projectContent.#.*...... 20 ImplementationPeriod - Schedulevs Actual...... 21 Factors Contributingto Time and Cost Overruns...... 21 Performanceof the ExecutingAgencies/Materials Suppliers, etc ...... 0...... 23 Project Monitoring.**..*...... 25 Role of Consultants...... 25 Research and Development,Operations Research and Training*.***.,... .oo...... too 26

IV. ECONOMIC APPRAISAL...... **** .... 27

V. CONCLUSIONS ...... 29

Project Performance Evaluation...*.**** ...... 29 Lessons Learnt for Implementationof Future Storage Projects...... *et 30

ANNEX G TABLES:

Table I Production of F oodggs ...... rs 32 Table 2 Compound Growth Rates of Area, Productionand Yield of Foodgrains in India ...... 33

of theirofficial duties. Its contents may not otherwisebe disclosedwithout WorldBank authorization. - ii -

Table 3 All-IndiaProduction, Procurement of Imports and Distribution Foodgrains ...... 34 Table 4 Net Availability,Procurement and Public Distributionof Foodgrains...... 35 Table 5 All-IndiaProcurement of Rabi/KharifFoodgrains (MarketingYear-wise) from 1964-65 to 1985-86...... 36 Table 6 Total Offtake (Distribution)of Foodgrains from GovernmentStocks (Al-India)...... 9999*... 37 Table 7 Index number of wholesale prices/offood-grains in India 9 ...... 9...999.99....99999999999999999999999999938 Table 8 Patternof ProcurementPrices of Foodgrainsin India*.*.*.... 39

Table 9 Stocks of Foodgrainswith Central and State Governmentsand Stocks in Pipelines...... 40 Table 10 Growth Pattern of StorageAccommodation with FCI...... 41

ANNEX P TABLES

Table 1 Details of Proposed and Actually ConstructedStorage Capacity.*...... 42 Table 2 Details of Proposed and Actually Constructed Storage Fclte 43 ...... Table 3 Details of Proposed and Actual StorageConstruction and Capacities ...... 46

Table 4 Center-wiseDetails of Railway Sidings ...... 53 Table 5 Year-wiseProject ImplementationDetails...... 55 Table 6 Storage Capacity Built under Retro-activeFinancing Component...... 56 Table 7 StatementShowing FinancialSources...... 57 Table 8 No. )f Rail-fedCenter where Siding Works are Not...... 58 -iii-

INDIA

SECOND FOODGRAINSTORAGE PROJECT (CREDIT 747-IN)

Project CompletionReport

Preface

This is the Project CompletionReport (PCR) of the Second Foodgrain Storage Project, for which a Credit in the amount of US$107 million was signed on January 1, 1978. The Credit was closed on February 19, 1986, at which time the final disbursementwas made and US$2.5 millionwere cancelled.

The PCR was prepared by Food Corporationof India (FCI). The IDA overviewand EvaluationSummary supplementsFCI's review with IDA's observations, giving specialattention to points and issues not fully covered by the PCR preparedby FCI. The overview has been prepared by Asia Regional Office and is based in part on the PCR, a review of the Staff Appraisal Report (No. 1643a-IN),dated November 3, 1977, correspondencewith the Borrower, internalBank memorandaon project issues as containedin relevant Bank files as well as interviewsand discussionswith officialsfrom the Borrower,and experienceduring project execution.

Tne draft report was sent to the Borrower on October 31 for coaments; however, no commentswere received.

The project was not subjectedto an audit by the OperationsEvaluation Department. - iv -

PROJECTCOtlPLETION REPORT INDIA SECONDFODDGRAIN STORAGE PROJECT (CR. 747-IN) Basic Data Sheet

Actual or ktual a I Appraisal Estimated of Appraial KeyProject Data Estimate ctual Estimate

Total Project Cost (USSN) 215.5 230.0 107 Total Project Cost (Rst) 1.886.2 2,250.0 119 Eligible for IDAFinancinq (U5$ 1) 107.0 Credit Amount(US$ O) 107.0 104.5 91.7 Credit Amount(Rs M) 936.0 DatePhysical Components Completed 31-Dec-81 31-Dec-85 ProportionCompleted by that Date (X) 100.0 91.0 91.0 EconomicRate of Re-urn 1) 19.9 19.7

Project Dates

Appraisal 06-Feb-77 BoardApproval 15-Nov-77 Credit Agreement 06-iJa-78 Effectiveness It-Nay-il ClosingDate 30-Jun-82 31-Dec-

CumulativeDisbursement FY78 FY79 FY80 FY81 FY82 FY85 FY84

AppraisalEstimate WUS$ N) 10.00 30.00 54.00 82.00 107.00 107.00 107.00 Actual (US$ ) 1.10 7.40 18.70 26.10 33.60 45.00 53.80 Actual as 2 of Estimate 0.11 0.25 0.35 0.32 0.31 0.42 0.50

Dateof Final Disbursementof Credit: 19-Feb-96 v

Special- izations Perfor- Types No. handaysRepre- mance of Date of in sented Rating Trend Problems NissionData (molyr)Persons Field 1/ 2/ 3/ 4/

Rev-iewof Project- Prep-ration Jun-76 1 1111 D IIA NA N/A Reviewof ProjectPreparation Aug-76 I NA D NA NA NA Appraisal FebiNar-77 5 155 B,C,D NA NA NA SupervisionI Feb-78 2 14 0 2 1 N Supervision2 Jul/Aug-78 3 24 B,0 2 1 K,I Supervision3 Feb-79 1 7 0 I 1 N Supervision4 Sep-79 2 10 C,D 2 2 K,D Supervision5 Nar-Bi 2 28 C,E 2 2 h Supervision6 Feb-82 4 32 C,D,E 2 3 N Supervision7 Sep-82 2 20 C,D,F 3 2 NA Supervision8 Feb-03 2 4 C,F 3 2 1 Supervision9 Apr-83 2 18 C,E 3 1 N Supervision10 Sep-83 1 6 E 3 2 O,N Supervision11 Apr-84 1 6 E 3 2 O,h Supervision12 Sep-94 1 7 E 3 2 O,D Supervision13 ?Iar/Apr-85 2 25 D,E 2 1 N

Total supervisionmandays 201

OtherProject Data

Borrower: Governmentof India ExecutingAgency: FoodCorporation of India Fiscal Yearof the Borrowoer: April 1 - March31

Nameof Currency: IndianRupee (Rs.)

CurrencyExchange Rate: AppraisalReport: US$1.00Rs. 8.51 AppraisalYear Average 1977: US$1.005 Rs. 11.5 IrsterveningYears Average 1978-04 US$1.00- Rs. 9.66 CompletionYear Average 1995: US$1.00= Rs. 12.50

Follow-upProject: None

1/ Specializationsrepresented: A = Agricultural 3/ Trend: 1 Improving 9 a Engineer 2 * Stationary C = FinancialAnalyst 3 Deteriorating D - Economist E = Agr. IndustrySpec. 41 Typesof Problems: F = Financial F = LoanOfficer N - Managerial T = Technical 21 PerformanceRating: 1 = ProblemFree or MinorProbleas P = Political 2 5 tlderateProbleas 0 5 Other 3 - MajorProbleas -vi-

INDIA

SECOND FOODGRAINSTORAGE PROJECT (CREDIT747-IN)

ProjectCompletion Report

EvaluationSummary

Introduction

The Second FoodgrainStorage Project followed the India Wheat StorageProject (Credit267-IN) which was implementedbetween 19W and 1979. The Second Project, the subjectof the PCR, was intended to finance a four year grain storage public sector investmentproject. Total project cost, estimatedat US$215.5million, was to be supportedwith an IDA Credit of US$107 million. At Credit closing,US$104.5 million was disbursedand US$2.5 million cancelled. The credit was closed in February 1986, four years behind schedule.

ProjectObjectives and Rationale

The project int-nded to support India's foodgrainpolicy at the time of appraisal in 1977. There were three major policy objectives: (a) self- sufficiencyin production;(b) price stabilityfor consumers;and (c) equitablefoodgrain distribution. To support these objectives,IDA funds were intended to increaseFCI's storagecapacity and reduce storage losses at a time when FCI was handling up to one-thirdof domestic foodgrainmarketing and 3.5 to 7.5 million tons of grain importsannually. Since about half of FCI storagewas at rented facilitiesand often under unacceptableconditions in the open under polyethylinecover, it was decided to have FCI invest in new storagefacilities with a target buffer stock of 12 million tons. The p:oject comprised: (i) constructionof 3.5 million tons of foodgrain storage consistingof 2.5 million tone bag, 1 million tons bulk, and 75,000 tons port silos for grain loading and unloading;(ii) ancillary facilitiesfor grain handlingand transport;and (iii) technicalassistance for project implementation;operations research; and training of management and key technicalstaff.

The Bank accepted GOI target "without going into arguments about the 12 million ton target" and agreed to finance both conventionaland modern storage facilities. The latter was expected to have a higher rate of return. The alternativeof privatesector storagewas not considered.

Project Implementation,Results and Sustainability

The project was implementedin eight instead of four years as planned and investmentswere made only in conventional saggedgodowns storage facilities. In total, 3.5 million tons storage capacity was constructedwhile - vii - appraisalhad foreseen2.5 million tons godowns,pl. 1.0 millio;.tons bulk warehousesand 75,000 tons silos. The ERR for the godown componentwas recalculatedalmost the same as appraised,i.e., 19.92 against 19.72, respectively,even though there was a cost overrun of 51x. However, despite the increaseof storage capacity,FCI's dependenceon rented storagedid not improve in relativeterms: it was about half at the beginningand rem2inedthe same at the end of the project. Hence the private sector investedat the same pace despite lack of governmentassistance.

Sustainabilityof the civil works constructedunder the project should not be a problem since the godowns constructedare of simple structure; they are used intensivelyand are expected to be properlymaintained.

Findings and Lessons

The project establishedthe total storagecapacity planned (3.5 million tons), but all of this was the traditional,existing type; there was no modernizationcompound (i.e., bulk warehousesand port silos) as agreed during negotiations. It remains an unansweredquestion whether India and IDA should have been more determinedin modernizingstorage facilities. Furthermore,the question of private sector storage supportwas never consideredas an alternativeto FCI-owned storagefacilities. In IDA's view, an importantlesson is that the private sector would have beer more efficient for the establishmentof storage facilitiesand it would have been less costly for Governmentas far as administrativecosts are concerned.

Today, there are again plans to invest in bulk storage facilitiesin India, albeit 10 years later. - viii -

INDIA

SECOND FOODGRAINSTORAGE PROJECT (CREDIT 747-IN)

Project CompletionReport

Overview

General

1. The ProjectCompletion Report (PCR) on the Second FoodgrainS.orage Projectwas preparedby the Food Corporationof India (FCI). This overview is intendedto supplementFCI's review resultswith IDA's observations. Special attentionwas given to points not fully covered by the PCR prepared by FCI (i.e., IDA performance,private sector alternative).

2. The PCR summarizesthe implementationand results of the Second FoodgrainStorage projectand discussesalternative grain storage issues. The project followed the India Wheat Storage Project which was partiallyfinanced with US$5 million each by Sweden and IDA (267-IN)between 1971 and 1979. This took twice the time estimatedat appraisaland only half the number of silos were constracteddue to cost overrun. However,godowns (reducedfrom 10 to 9 becauseof land acquisitionproblems) were completedahead of schedule. ERR was estimatedat 15% as compared with 25% expected at appraisal.

3. The Second FoodgrainStorage had problems similar to those of the Wheat Storage Project: it took eight instead of four years to implementthe projectwhich also suffered from cost overrun problems. Furthermore,only the godown componentwas executed,while bulk warehouses,port silos Aindthe pilot mechanizedgrain procurementcenters were not completedand consultantswere only partiallyused. Notwithstandingthe 'bove,the PCR preparedby FCI reportsfavorably on the project, in that it established3.5 million tons godown storagecapacity as compared to only 2.5 million tons proposed at appraisal. The ERR of this componentwas reestimatedat 19.9%, similar to the 19.7% estimatedat appraisal. While this analysis correctly states the ERR per se it does not compare it with different investmentstorage types to determinedesirable or better storage. The PCR also describesthe factors contributing to time and cost overruns which were: (a) difficultie: in land acquisition,(b) delays in the executionof railway sidings; and (c) inability of some local contractorsto perform work contracts satisfactorily. However, it does not convincinglyexplain why: (a) only conventionalgodowns were constructedunder LCB procedure; (b) all items foreseen for ICB were not executed; (c) training funds were only used &t one-fourththe finance available;(d) consultantswere used only in a small amount (one fifth); and (e) land acquisitionsand constructionproblems occurred, similarto those of the first project,despite the lessons learned.

4. Total project costs were estimatedat appraisalto be Rs 1,886 million (US$215.5million) to finance the corsLIuctionof 3.57 million tons of additionalpublic grain storage capacity--2.5 million tons of conventional - ix -

godowns for grain stored in bags, 1.0 million tons of flat bulk warehouses, and 75,000 tons for port silos for handling importedgrain. Furthermore, financewas provided for auxiliary facilitiesfor grain handling and transport,technical assistance, operations research studies and training of key staff. An IDA credit of US$107 million was expected to finance 50% of the projectcost, net of taxes and duties. Eventually,3.5 million ton storage capacitywas constructed,but ali under conventionalbagged godowns. Regardingthe constructionexpenditures for godowns, t'"erewas a cost overrun of 51%, while total project cost as completedexceeded appraisalestimated by 19%; US$2.5 million of the IDA credit was cancelledat Credit closing.

5. ProjectObjectives and Rationale. The project intended to support India'sfoodgrain policy at the time of appraisal. There were three major policy objectives:(a) self-sufficiencyin production;(b) price stabilityfor consumers;and (c) equitable foodgraindistribution. Foodgrain prices were regulatedto: (a) ensure reasonableprices to producers;(b) procure a sizable portion of marketed foodgrainson behalf of GOI and State governments;(c) release foodgrainsthrough the public distributionsystem primarilyin urban areas at below market prices by a ration card system; (d) fix official purchasingand distributionprices regardlessof seasonal or locational factors;and (e) build up sizeable buffer stocks to protectconsumers from wide variationsin production caused by irregularand untimely monsoons.FCI was engaged in procuringfoodgrains at over 2,500 market centers and was operatinggodowns at 1,700 locationsthroughout India. It was handling 10 to 35% of foodgrainsmarketed and, in addition,it handled 3.5 to 7.5 million tons of grain importsper annum. Since about half of FCI storage was at rented facilitiesand often at unacceptableconditions in the open under polyethylenecover, GOI had decided to have FCI invest in new storage facilities. Actually,a 12 million tons buffer stock was the declared target.

6. The Bank appraisalaccepted GOI targets "withoutgoing into the argumentsabout the 12 million ton figure." The projectwas to finance conventionaland modern storage facilities. The latter were expected to have a higher rate of return. The alternativeof developingcompetitive commercial distributionsystems and private sector storage facilitiesfor new investments was never seriouslyconsidered.

7. Project Preparationand Implementation. During preparationIDA clearlywanted to be involved in bulk type storage being consideredmore efficient,but there were problems in discussing storagepolicy with GOI which did not want to discuss its grain storagepolicy, which it considereda sovereign,national matter involvingsecurity considerations. While IDA wanted to "increasethe bulk storage capacity"and "make a beginning in developingan integratedsystem for handling,movement and storage of foodgrains,"GOI was primarily interestedto quickly enlarge its storage capacity through traditionalstoring methods, i.e., in godowns stored in bags which were more efficientthan storing in the open but less efficienttian bulk storage.

8. The agreed project as negotiated,howe.er, includedall three components: godowns storing in bags, flat bulk warehouses,and port silos. Soon after credit signature,preparations were in place to implementall three components. The credit was signed January 6, .978 and startedoff satisfactorily although there were problen, .ith appointingstaff to implement he x

project. Initially,there were no land acquisitionsproblems. Construction of conventionalgodowns, for which retroactivefinancing was provided,started well. However, the appointmentof consultantsfor bulk warehousesand silos was protractedand took place only in March of 1979, due to problems in selectinga qualifiedfirm becauseGOI wished to retain the lowest bidder. In April 1979, IDA staff rated this project "problem free" but with disbursements falling behind estimates. However, the positive evaluationdropped dramaticallywhen a supervisionmission visited the project in September 1979. The main issue was the project period since th? implementation consultantshad declared that project implementationwould requireeight insteadof four years, mainlv because of bulk warehouseand silo construction. IDA expressedconcern about the time overrun and proposedmodification of the projectwithout being specific,while FCI maintained that the modernizingcomponents should still be implemented. It was only in early 1980, after severalreminders by IDA that GOI somewhat reluctantlyproposed that the flat bulk warehousingand silo componentbe reduced. Thus IDA failed in its estimatesof tne project implementationperiod and appears to be also responsiblefor the eventual deletion of the technicallyinnovative components,even though the project actually stretchedover eight years anyway.

9. Bank mission suggestedretaining the above componentson a pilot scale with the establishmentof two bulk storagefacilities of 30,000 tons each to test such facilitiesunder Indian conditions. But this was apparently never done. From FCI's PCR it appears that the bulk and silo storage componentswere finally droppedafter a "high level railway team" visited Europe,USA and Canada in late 1980. The railway team advised after its overseastrip against modified flat bed wagons fitted with paper retention doors and proposed instead special bulk grain wagons. However, since such specialwagons were planned to become availableafter the project investment period this componentwas dropped. IDA's repeated suggestionfor further study and pilot investmentsdid not result in action. It appears that oppositionto labor displacementin the case of bulk storagewas also a factor for GOI's decision. Ironic&lly,in April 1984 FCI approached IDA for financialassistance to construct"four to five million tons of silo and horizontalbulk stores."

10. In general, Bank supervisionwas satisfactory,concentrating on LCB tender evaluationfor the godown componentand urging FCI to make all efforts in limitingfurther constructiondelays. There were no major difficultiesin covenant fulfillmentas far as FCI is concerned.

11. Summary and Conclusion. Unrelatedto the project, IPdia had great success in increasing its food grain productionduring the eight years of project implementation. The country became self-sufficientin this sector and public procurementincreased from 59 million tons p.a. during 1976-80to 83 million tons p.a. during 1981-85. As discussedin detail in the PCR and reviewedin this overview all project investmentswere conventionalbag godownsonly, even though the Sixth Five Year Plan (1980-81/84-85)stated "emphasishas to be on efficientand socially relevantmarketing techniques taking advantageof the economicsof bulk handling,procurement and distributionsystem." - xi -

12. All this took place in an atmosphereof rapid productionand storage increaseof food grains overall. While India'spublic sector (covered) storagecapacity was 105 million tons at the time of appraisal (representing 57Z of total grain steragecapacity) this had doubled to 20.8 million tons by mid-1985. Nevertheless,FCI dependenceon hired storage capacityhad not changed: it was about half at the beginningand at the end of the Project. Hence the private sector investedat the same pace despite lack of government assistance. This raises a policy question: should India not leave ownership and managementof grain storagemore to the private sector. A weLl-planned line of credit could induce the private sector to invest more in storage facilitieswhich FCI could lease without having the financialrisk of utilizingsuch facilities. IDA believes that the private sector would be more flexibleusing such facilitiesfor storingproducts other than grains as well.

13. FCI's PCR concludesthat delays were partly due to the fact that "the Project did not receive the right order of priority." Research studies were undertakenregarding "storage and transportationof grain in bulk in relation to the existingbag handling system." What actually stopped any investmentsin bulk storageappears to have been IDA's endeavor to execute the project on time and the railway team's technicalreservations after their trip to western countries. These reservations,however, were never specified.

14. While the Bank at the time of appraisalwas convincedof the economicadvantages of modern bulk and silo storage, it was quick in dropping this componentwhen problems of timelinessoccurred. Since the feasibilityof these componentswas not even tested during the project, one must conclude that the project contributedvery little to modernizinggrain storageand reducing its cost. Nevertheless,it made a sizeable contributionto increasingIndia's storage capacity. FCI's overall assessmentof the project worth was as follows:

"Althoughthe bulk storagecomponents relating to flat bulk warehouses,port grain silos, transportequipment, etc. were deleted from the project content, the experiencegained, particularlyin respect of initialdesigns and grain flow diagrams and proposed systems developedby the consultantsfor port silos and for certain cost efficientmodels of flat bulk warehouses, is expected to be useful in the implementationof future projectswith such installations."

Eventually,India is likely to make appropriateinvestments in modern bulk storage facilities. Actually, it approachedthe Bank in 1984, inquiringfor possible financialassistance. The ongoing Seventh Plan includes provisionof bulk storage installationsand bulk movement of grain. It is, therefore, unfortunatethat the bulk storage component,included in the 1977 negotiated project,was eventuallydropped. Apparently,this type of investmentis now reconsideredby GOI, after 10 years. INDIA

SECOND FOODGRAINSTORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Introduction

This document presents the project completionreport (PCR) on the Second FoodgrainStorage Project undertakenwith the financialassistance from the World Bank/IDA by the Governmentof India under Phase II program. Credit agreementwas signed by the IDA/GOIon January 6, 1978 and FCI was to implement the total project under the overall responsibilityof the Ministry of Agricultureand Irrigation. The general guidelinesfor preparingproject completionreport (includingsector guidelines)of the World Bank have providedthe frameworkfor this document. However, in view of the distinct nature uf storage project viz. constructionof godowns for scientificstorage of foodgrainsunlike productionor manufacturingproject some deviations from the general guidelineshave been made in the presentationof PCR.

The scheme of presentationis as follows:

In Part I general perspectiveon food situationduring the project period i.e. from 1977 to 1986 is presented.

Part II covers specific issues and aspects of project implementation in terms of physical and financialperformance over the period including departuresmade from the original project proposal.

Part III explains the contributionmade by the project to Indian economy in general and FCI in particular. The rate of return as originally estimatedand as expected from actual investmenthas been computed.

Part IV brings out the experiencegained from the executionof such a project. -2-

I. FOOD SECURITYPERSPECTIVE

Food Policy Objectives

1.1 Food policy objectivesof Governmentof India include:

(a) to ensure that the producersget reasonableprices and continue to have adequate incentivesfor increasingthe production;

(b) to ensure that consumer prices are stabilizedand in parti:.ularthe interestof the low it.t-meconsumers are safeguarded;and

(c) to build up adequate buffer stocks of foodgrainswith a view to ensure attainingof the twin objectivesmentioned above/selling from the buffer stocks to meet the shortage conditionsand high prices or by procuringfor the buffer stock to support fallingprices.

These objectives,enunciated during the Fourth Plan period continue to be the focal points for the managementof foodgrainsby the Governmentof India. These objectiveshave been part of the developmentand welfare strategy of the Governmentof India. Break-throughin agriculturalproduction as a result of Green Revolution in late sixties could not have been sustainedwithout providing effectivelymarket and price assuranceto farmers. Over the last two decades throughperiods of deficits and occasionalsurpluses, the FCI has continued its effqrts in fulfillingthe food policy objectivesof providing effectiveprice support to farmers, distributionof foodgrainsat reasonable prices and in achievingthe target level of buffer stocks. The FCI through its main operationsof procurement,transportation, storage and distribution of foodgrainshas contributedsignificantly in transformingthe food supply managementfrom the earlier drought/shortageprone supply to that ef a stable food security system. Adequacy, stabilityand accessibilityof foodgrains have been achieved to a large extent as explained in succeedingparas.

Plan Priorities

1.2 Growth of Indian economy is highly dependenton the performanceof agriculturalsector. Objectives in the Fifth and Sixth Five Year Plans of the Governmentof India basicallyrelate to the central theme of improvingthe qualityof life by way of bringing the people above the poverty line through increasedemployment, agricultural and industrialgrowth, etc. The Seventh Five Year Plan has laid emphasis on 'Food, Work and Productivity'as the basic strategyfor the perspectiveplan of 15 years ending 2000 AD. Attaining these objectivesinvolves implementationof agriculture-orienteddevelopment strategy.

1.3 During the Sixth Five Year Plan (1980-81/84-85)implementation of food policy has been assigned a higher priority as would be evident from the extractsreproduced below from the Plan Frame-workapproved by the National DevelopmentCouncil: - 3 -

"Public distributionof commoditieslike foodgrainswill have to play a major role in ensuring supplies of these commodities to consumersat reasonableprices. Likewise farmerswill have to be provided with remunerativeprices by paying due attentionto their cost structure,to ensure that they have adequate incentiveto produce more particularlyfoodgrains, pulses and oilseeds. It further suggestedmaintenance of buffer stock to be absolutelyessential in order to minimize the impact of weather fluctuationson prices of foodgrains. As such the public distributionsystem will be so developed that it will hereafterremain a stable and permanentfeature of the Government'sstrategy to control prices and to achieve equitabledistribution. Towards this end, emphasis has to be on efficientand sociallyrelevant marketingtechniques taking advantagesof the economicsof bulk handling,procurement and distributionsystem."

1.4 Foodgrainsconstitute a major share of agriculturalproduction. Problems of food production,its storageand movement across the countryneed to be viewed on a wider convass speciallybecause of spatialand price imbalancesin the demand vis-a-vissupply of foodgrains. These imbalancesget aggravateddue to natural factors like drought, floods and famines in different parts of the country apart from inadequate(occasionally excess) rainfall at crucial times of growth of foodgraincrops in the main foodgrainproducing areas. This affects the income levels of the farming sector adversely. The agriculturalsector has, therefore,continued to receivehigher priority in the natural plan objectivessince inceptionof planningera from 1950-51. There has been almost three-foldincrease in the foodgrainproduction in the last three decades.

Assurance of Food Secutity

1.5 During the ven year period from 1977-78, i.e., from the start of Second FoodgrainStorage Project in 1977-78,there has been continuous improvementin all fronts of food managementdespite unprecedentdrought witnessedduring 1979-80accross the country. With adequate inventoryof foodgrainstocks with public agencies,adequate food security is assured. All the three aspects of food security system viz adequacy,stability and accessibilityhave been attained to a large extent. Brief account on each of these aspects is presentedbelow:

Adequacy

1.6 Growth Rates. Attainmentof adequacy is reflectedby the tempo of Green Revolutionsustained by the country by registeringgrowth rates of productionof wheat, rice and total foodgrainsat a fairly high order speciallyin wheat as shown below: - 4 -

Compound Crowth Rates of Productionof Foodgrains (in 2 P.&.)

Crop During 1967-68to 1983-84

Wheat 5.77 Rice 2.27 Total cereals 2.87 Total pulses 0.35 Total foodgrains 2.61

Source: Annexure-G-Ifor productionof foodgrainsin India and Annexure-G-IIfor details on growth rates.

Among various programs for increasingproduction, effective market and price assuranceby public agencies has been an importantelement in attaining such impressivegrowth rates.

1.7 Market Assurance. The degree of market and price assuranceprovided by FCI and other public agencies is broughtout in the followingdata:

Marketingyears 1982-83 1983-84 1984-85 1985-86 1986-87

Wheat Procurementas X of market arrivals: Punjab 99 98 99 98 97 Haryana 97 99 96

Crop years 1980-81 1981-8T2 1982-83 1983-84 1984-85 Rice Procurementas Z of production: Punjap 78 82 78 72 85 Haryana - - 56 49 72

Extensivepurchases through 6,800 purchase centershave provided effective market nadprice assuranceto farmers. This effort has sustained increase in the income of farmersand is providing the required impetus for higher investmentin agricultureand improved productionand productivity. 1.8 Self Sufficiency. In the past two decades, indigenousprocurement of foodgrainhas been increasingat encouragingpace as can be seen from the table below:

FOODGRAIN (In million tons)

Total Total Total procurementas Years (five years) procurement distribution Z of distribution

1961-65 7.23 32.28 22.40 1966-70 28.37 55.71 50.92 1971-75 40.07 51.76 77.41 1976-80 58.89 57.74 101.99 1981-85 82.79 71.40 115.92

Source: Annexure-G-IIIfor year-wisedetails.

1.9 The perspectivepicture of the levels of procurementand distributionby all public agencies includingFCI given above brings out that the procurementhas substantiallyincreased and has in fact been much in excess of the distribution. It is in this context that India has emerged as self sufficientin foodgrainrequirement. In normal years, public distrihu- tion aystem requirementsare met by indigenousprocurement. It is only in the year of drought or abnormallylow productionthat the suppliesare drawn from the buffer reserves held by the FCI. By mid-1985 surplus stocks over and above the target level of buffer and operationalstocks had emerged. The extent of surpluswas estimated to be around 7.0 million tons mainly in the form of wheat.

1.10 Stabilityhas been ensured as would be revealed by the pattern of productionin foodgrains,stocks levels with the public agencies,per capita net availabilityof cereals, levels of public distr:butionand the index numbersof wholesaleprice of foodgrains.

1.11 During the last one-and-a-halfdecade though the gross area under cereal crops has not increasedsubstantially yet there has been consistent increasein the productionwhich is contributedby increasedproductivity (yield)as a result of expansion in irrigatedareas apart from applicationof better farm managementtechniques and the motivation providedby the public agencies through continuedmarket and price assurance for wheat/paddyand rice.

1.12 The followingdata is relevant: - 6 -

Gross area Gross (million production Yield Area irrigated Year hectares) (mln tons) (kg/hectare) (mln hectares)

Total Foodgrains 1970-71 124.32 108.40 872 N.A. 1975-76 128.18 121.03 944 34.09 (26.5) 1980-81 126.67 129.59 1,023 37.61 (29.4) 1983-84 130.35 152.37 1,163 - 1984-85 126.67 145.54 1,154 - 1985-86 N.A. 150.47 N.A. -

Total Cereals 1970-71 101.78 96.60 949 N.A. 1975-76 103.73 108.00 1,041 32.14 (31.0) 1980-81 104.21 118.96 1,142 35.59 (32.8) 1983-84 106.94 139.48 1,299 - 1984-85 103.94 133.58 1,289 - 1985-86 N.A. 137.51 N.A. -

Wheat 1970-71 18.24 23.83 1,307 N.A. 1975-76 20.45 28.85 1,410 12.56 (61.8) 1980-81 22.28 36.31 1,630 15.52 (69.7) 1983-84 24.40 45.48 1,851 - 1984-85 23.61 44.07 1,873 - 1985-86 N.A. 46.88 N.A. -

Rice 1970-71 37.59 42.23 1,123 N.A. 1975-76 39.48 48.74 1,235 15.22 (38.7) 1980-81 40.15 53.63 1,336 16.34 (40.5) 1983-84 40.99 60.10 1,458 - 1984-85 41.16 58.34 1,425 - 1985-86 41.16 58.34 1,425 -

Note: Figures in parenthesis represent the percentage irrigated area to total area under the crop.

1.13 This phenomenon is partially explained by the fact that assured irrigation facilities are concentrated in Stttes like Punjab, Haryana, Western U.P. where the irrigated area has continuousLy been increasing both for Rabi and Kharif crops which helps in stabilizing the production to new levels. All-India production is, therefore, less prone to fluctuating production levels observed in some other States. In effect, stability in the production levels in Punjab, Haryana and U.P. is imparting greater stability in All-India production. 1.14 Increasingproduction levels in wheat and rice in Punjab, Haryana and U.P. have enabled public agencies to concentratetheir procurementefforts mainly in these states. This is indirectlycontributing to stabilityin procurementalso at higher levels.

1.15 Attainment of foodgrainproduction level of around 150 million tons during 1983-84/1985-86is indicativeof the level around which the foodgrain productionmay continue before shiftingto new peak after few years. Produc- tion data over the last three decades reveals that foodgrainproduction level continuesaround a particularlevel over a few years (6-7) before it shifts to a new level. The followingdata will explain this pattern:

(Milliontons)

Gross productionof foodgrain Year Minimum Maximum Average

1960-61/66-67 72 89 80 1967-68/74-75 94 108 100 1975-76/82-83 110 133 124 1983-84/85-86 146 152 149

1.16 Price Stability. Apart from relative stabilityin production,price stabilityis also essential. This is also achieved as would be revealedby the wholesaleprice index numbers particularlyof wheat and rice--thetwo principalcereals handled by the FCI.

INDEX NUMBERS OF WHOLESALEPRICES (Base year 1970-71= 100)

All Annual average commodities Foodgrain Wheat Rice

1977 185.4 167.2 155.8 163.6 1985 353.0 289.4 218.8 281.6

Change in 1985 over 1970-71 +253.0 +189.4 +118.8 +181.6

1.17 It would be observed that increase in price levels of wheat and rice has been less pronouncedcompared to total foodgrainor all commoditiesduring the last one-and-a-halfdecade period. Likewise the prices of wheat and rice have witnessedgreater stability in the last one decade. Foodgrainsbeing -8-

importantcomponent of wage-goods,relative stability in the prices of wheat and rice has had restrainingimpact on general inflationarytendencies in the economy.

1.18 Inflationaryconditions adversely affect the purchasingpower of the weaker sections. To protect their interests,the Governmentof India as a welfare strategy fixes issue prices below the economic cost and meets the differencein the form of consumerssubsidy. Issues at concessionalor subsi- dized prices have enhanced the accessibilityof the poorer sections. Adequacy of stocks with public agencies has enabledcontinued access to the poorer sectionsat reasonableand fixed prices, e.g., during 1980 and 1981 post- droughtyears.

1.19 Though the procurementprices of foodgrainshave continuedto be increasedevery year, the central issue prices of wheat and rice for the suppliesthrough public distributionsystem on the other hand have had longer spells of stability. The followingdata is relevant:

GOVERNMENTOF INDIA ISSUE PRICES OF WHEAT AND RICE (Rs per qtl)

Wheat (all varieties) Period For From To PDS /a RFM /b 04/15/74 11/30/78 125 125 12/01/78 03/31/81 130 130 04/01/81 07/31/82 145 145 08/01/82 04/14/83 160 160 04/15/83 08/09/84 172 208 08/10/84 01/31/86 172 172 02/01/86 03/31/86 190 190 04/01/86 07/15:86 190 220 07/16/86 190 205 Rice Varieties Coarse From To (Common) Fine Superfine 11/07/75 10/24/79 135 162 172 10/25/79 12/31/80 150 162 172 01/01/81 09/30/81 165 177 192 10/01/81 09/30/82 175 187 202 10/01/82 01/15/84 188 200 215 01/16/84 10/09/85 208 220 235 10/10/85 01/31/86 217 229 244 02/01/86 09/30/86 231 243 258 10/01/86 onwards 239 251 266

/a PDS: Public DistributionSystem 7b RFM: Roller Flour Mills 1.20 Stocks. Foodgrainstocks with all Governmentagencies on selected dates are given below:

(Milliontons)

As on Wheat Rice Total

07/01/75 4.2 1.6 6.0 07/01/76 12.0 5.1 17.7 07/01/81 7.1 5.8 13.7 07/01/83 13*0 3.8 17.0 07/01/85 20.7 7.8 28.7 07/01/86 19.2 9.5 28.8

1.21 The net accretionin foodgrainsstocks held by Governmentagencies during the two year period from July 1983 to July 1985 was about 12.0 million tons, taking the actual stocks to a record level of about 29.0 million tons by mid-1985which was in excess of target operationaland buffer stocks (21.4 million tons) by over 7.0 million tons, mainly in the form of wheat. Comfort- able stock position has been achieved by increasedprocurement over and above the distributionrequirements. This record level of stocks has provided the required stabilityin managing the food requirementsof the country in the long run. Moreover,FCI with effectivemanagement of surplusesand deficits in differentstates having divergentfood habits has been able to develop an integratednational approach in tackling the food problem.

Accessibility

1.22 Accessibilityof stocks is ensured through !e operationsof the public distributionsystem in the form of f rmal/informalrationing system all over India. The objectivesof distributioninclude adequate supply of foodgrains in differentparts of the country speciallywith a view to supplement the consumptionlevels of low income segmentof the populationand to keep the open market prices under check. Though the supplies under the public distribution system are of supplementalnature, these are made at concessionalor subsidizedprices as a welfare measure to improvethe diet and calorie intake of poorer sections having low purchasingpower.

Role of Food Corporationof India (FCI)

1.23 Procurement,storage and public distributionsystems are essential ingredientsof the overallnational food security system in India. Unless these are fully developed,the delivery system cannot be made effective, efficient and economical. This task is, though, a joint responsibilityof the Central and State Governments,the role of Food Corporationof India (FCI) has been vital. FCI being the national agency responsibleto execute the policy - 10 -

of the CentralGovernment has expanded its organizationalnetwork both geographicallyand functionally.

1.24 FCI today operates through a country-widenetwork with its Corporate Office at New Delhi, 4 Zonal Offices for South (at Madras), North (at New Delhi),West (at Bombay) and East (at Calcutta),19 RegionalO.fices covering all the 22 Indian States and 7 Union Territories,4 Port OperationOffices, 145 DistrictOffices, about 2,000 Storage centersand 138 quality control laboratories. The authcrizedcapital of the FCI was raised to Rs 10,000 million duriag 1985-86 (from 4,500 million until 1984-85). The paid up capital by the Governmentof India is Rs 7,440 million against Rs 3,075 million at the close of March 1985. For the purpose of constructionof godowns, the capital amount requiredis met by the Governmentunder the centrallysponsored plan schemes. For its day-to-dayoperations in foodgrains,it is allowed credit facilitiesby a consortiumof nationalizedbanks. The Governmentof India gives surety against the margin money requirementsand the hypothecationof stocks with the banks. Within the cash credit limits, the FCI withdrawsand utilizes the money from the banks as per its requirements.

PDS Network

1.25 The public distributionsystem has been enlargedand expanded considerablyin the last two decades and today covers about 3.22 lakh Fair Price Shops. The prevalent system envisages supply of foodgrainsperiodically (weeklyor fortnightly)of specifiedquantities at subsidizedissue prices on the basis of ration cards issued to families. Fair Price Shops get their suppliesfrom the wholesale agent who in turn gets the supplies from FCI godowns. The range of off-take to total supplies from Governmentstocks has gone up to 12-16 million tons/perannum in the eightiesas shown below:

No. of FPs Total distribution Years ('000) (milliontons)

1961 48 3.98 1971 121 7.82 1974 222 10.79 1977 242 11.74 1980 276 14.99 1983 297 16.21 1984 311 13.34 1985 322 14.07

1.26 Such a phenomenalincrease in the expansionof public distribution system has been facilitatedinter alia by the developmentof storage capacity under the World Bank aided projectand other storage constructionprograms launched by the Governmentot India/FCI. Constructionof storagegodewns and -iL- THE FOOD CORPORATION OF INDIA

ORGANISATIONAL STRUCTURE ( - ~~~~~~~~~~~~~~~~~~Zonal |7 ar,¢ DISTRICT AND DEPOT OFFICES (ofrth)e T~~~~~~~~~~~~~~~~~~~~~~~~eDerllbyhiT _~~~~~~j LLL 4 L WLLI T'l

H.P Punjab Delhi U.P. J St K Rego Region Region Resion ReSion %;mlk ChnXrhm New DdhiN Lucknow Jammun (R.M) .(S.R.M. (R.M (S.RM.) (R-M)

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7 (Sh tMi 1-0 NEW DELHI Patna

J_ Ma / SO T ZNE \ W. Bengal 1 l Pat oetIL/ 'RIgion1 IITamil Nadu II A.P I.| /| t esion |||Region §l /IIMadras 1 IHdrbadII\IH I / ||(S.R.M.I ) (SIR.M. | |AsLsamtnn H

/ J|oint ||Kamataka ||Keaa\ I / ManSuer |||Region I Region ;\ INorth. IIt / Part Operation Bangabore || Tnvanidrum \ atrnRgo I / Patnam (R.M.I (S.|05R-M.) \ReSilogi|o|nEatr

/ | l l l l l l § \ ~~~~~~~~(R.M) r /' ~~~~~~~rF rff rf- r

2 Office DISTRICT AND DEPOT OFFICES | Office Z (South) .| Iat T Madras Calcutta i r

ZTI Zonal Ttaintng Invstttute __ FormnalControl CTI Central TratnungInstitute ______Intormal Contvol - 12 - their operationsin various deficit states has enabled the FCI to position operationaland buffer stock of foodgrainsnearer the consumptionareas,

1.27 In addition to supplies under PDS, the foodgrainsare issued at still lower rates under poverty alleviationprogram of the Governmentof India such as Food for Work Program now replaced by National Rural Employment Programme(NREP) (October 1980), Rural Landless EmploymentGuarantee Programme (RLEGP), EmploymentGuarantee Scheme (EGS). These schemeshave the objectives of creatingdurable communityassets in the rural %.conomy,provide direct employmentto the poor to augment their income level and raising the nutri- tional standards. Governmentof India in December 1985 introducedfoodgrain distributionprogram in IntegratedTribal DevelopmentProject areas. Under this scheme, issues in ITDP areas are effected at speciallysubsidized prices. For wheat, the issue price is Rs 125/qtlas compared to Rs 190/qtl for normal PDS. For common variety of rice, these respectiveprices, at present,are Rs 160 and Rs 239.

1.28 Issues of foodgrains under these schemes are given below:

('000 tons)

Year Commodity NREP RLEGP ITDP

1983 Wheat 115 Rice 76 -

1984 Wheat 84 19 - Rice 80 6 -

1985 Wheat 178 54 18 Rice 70 9 28

1986 Wheat 1,162 290 636 (Jan-Sept) Rice 121 43 615

1.29 As a matter of fact economic accessibilityto the poorer sections is ensured now under such programs by giving foodgrainsat rates lower than PDS rates. Releases under these schemes have also indirectinfluence on open market prices. To tie over the problems of managing the surplus stocks the Government of India has also taken various liberaldecisions including Auction Sales/TenderSale initiallyand now, free sale of wheat by FCI at fixed prices, issue of unrestrictedwheat to Kuller Flour Mills, enhanced alloca- tions under PDS, delicensingof Roller Flour Mills, reductionin issue price to Roller Flour Mills, issue of wheat to cardholdersunder PDS without any limit on quantity,etc. All these measures have had salutoryimpact on open market prices rhich makes easy accessibilityto grain by the poor. - 13 -

1.30 IncreasedTransportation. Inter and intra-regionaltransfer of stocks from surplus areas is pre-requisiteto ensure the accessibilityof foodgrainstocks to consumers. Positioningof stocks in all the regions adequate for the operationalneeds taking into considerationthe time lag involved in transportationlead is a critical operacion.

1.31 FCI operatesabout 2,000 storage godowns spread all over the country. FCI through continuousmonitoring and coordinationwith Railways formulatesmonthly movement plan to organize despatchesof stocks to different regions accordingto operationaland buffer needs. FCI constantlymonitors transportationof stocks from the surplusareas of Punjab,Haryana and Western U.P. in the North Zone where major part of surplus stocks (wheat and rice) is concentrated. Similarly,Andhra Pradesh in the South Zone has surplus in rice. Movement over long distancesby rail is undertakenby the Corporation, with the primary objectivesto:

(a) clear excess stocks from surplusStates in the North Zone; and

(b) transportadequate stocks to deficit States in East, West aad South Zones matching operationaland buffer levels.

1.32 Short distancemovement initiallyfrom the mandis to depot(s) and thereafterto the rail-headand similar operationson the receivingend are done by road. However,major transportationis by rail. The averagedistance of movement in 1985-86was around 1,533 km. The magnitudeof foodgrainstocks transportedby rail have increasedsubstantially as would be seen from the following:

(Million tons)

Quantity moved by rail for FCI Year Foodgrain Foodgrainand sugar

1980-81 11.6 13.20 1981-82 14.0 15.10 1982-83 15.4 16.70 1983-84 15.1 16.34 1984-85 12.9 14.10 1985-86 16.4 18.80

Storage

1.33 The programs of increasingproduction and expandingdistribution also requires a matching growth of infrastructuresin the form of standard storage accommodation. In order to ensure stockingof foodgrainsall over the country in optimum manner, storage constructionprogram has been a major activity of the FCI continuouslyover the years. Accordingly,under the three-tierstorage strategyof Governmentof India, FCI and CentralWare- - 14 - housing Corporationhave been providingstorage accommodation at centers of All-India importance,the State WarehousingCorporations and the State Govern- ment(s) at centers of State importari-eand at District levels and cooperatives at primaryand marketing society level which are located at vil.age and/or Taluka levels.

1.34 The broad approach is to build additionalscientific storage capacity and to reduce dependenceon hired capacitywhich is not up to the desired standardas also to reduce dependenceon the capacity under Cover and Plinth (CAP).

1.35 There are three agencies in the public sector which are engaged in building large scale storage/warehousingcapacity viz Food Corporationof India (FCI), Central WarehousingCorporation (CWC) and 16 State Warehousing Corporations(SWCs). Over a period of time, sizeable scientificstorage/ warehousingcapacity has been developedby these public agencies and they are implementingplans to increase it further. While the capacity availablewith FCI is used for storage of foodgrainsthat with CWC and SWCs is used for storage of foodgrainsas also for general warehousing.

1.36 Since the Corporationdid not have adequate scientificstorage accommodationin mid-seventies,this project was conceivedin order to avail the financialassistance of the World Bank, for bridgingup the then identi- fied storagegap of 7 to 10 million tons. The projectwas expected to replace the then CAP and rented accommodation(unscientific) with scientificbag/bulk warehouse storagecapacity.

1.37 Increasedlevels of indigenousprocurement over and above the distributionrequirement have been resultingin net accretionto stocks occasionally. FCI's storage capabilityhad, therefore,been under constant pressure. Substantialnet accretionof stocks during 1983-85 period (by 12 million tons) necessitatedaugmentation of storagecapacity on high priority. Apart from the ongoing constructionprograms under the World Bank, etc., crash programwas launchedduring 1984-85/1985-86for providing additionalstorage capacity of 2.42 million tons on prioritywithin 15 months at a capital cost of Rs 90 crores.

1.38 Cognizantof substantialaccretions to foodgrainstocks, the ongoing efforts to increase the storage capacitywere stepped up during 1984-85. As a result, the FCI, CWC and SWCs together constructeda storage capacityof 11.72 lakh tons for foodgrainsduring 1984-85which was significantlylarger than 7.09 lakh tons constructedby them during 1983-84. Notwithstandingthese additions, the total storage capacityavailable as on July 1, 1985 came under considerablestrain and proved insufficientto hold the foodgrainstocks as on that date. This is because the stock level rose much more from 22.8 million tons as on July 1, 1984 to 28.7 million tons as on July 1, 1985. Arrangements were, therefore,made to accommodateover 7 million tons of foodgrainsin the open/CAP. Moreover to augment the storageconstruction capability, FCI involved for the first time simultaneouslya number of other engineering constructionagencies of the public sector to acceleratethe pace of construction and achieve the targettedcapacity. - 15 -

1.39 The growth in the storagecapacity both from owned and hired since the commencementof this project has been as follows:

(In million tons)

Covered CAP/Open Covered and Financial Owned Hired FCI owned FCI hired open year end capacity capacity /a capacity capacity Grand total

1977-78 6.457 7.100 1.615 5.611 20.784 1978-79 7.239 8.225 1.289 5.303 22.058 1980-81 7.757 8.012 1.238 3.783 20.790 1982-83 8.206 7.866 1.112 0.957 18.143 1983-84 8.545 8.551 1.056 0.472 18.625 1984-85 9.174 10.517 0.798 1.779 22.269 L985-86 10.366 10.429 1.332 2.341 24.469 '986-87 10.763 10.589 1.666 2.128 25.157

(August31, 1986)

/a From CWC/SWCs/StateGovernment(s)/Pvt. parties includingARDC Scheme.

Source: Annexure-G-Xfor details.

1.40 It would be observed that the dependenceon the hired storage capacity (both Covered and Open) has continuedto be almost equal to the owned capacity. Hired capacitiesspecially from private parties are not necessarily scientificand optimallylocated. To constructowned scientificcapacity as much as possible, special effortswere made to complete constructionof godowns during the last four years which resulted in augmentationby about 5 million tons including2.37 million tons owned capacity as follows:

Constructionof FCI owned storagecapacity Year ('000 tons) Z Increase

1982-83 338 1983-84 442 31 1984-85 550 24 1985-86 1,040 89 - 16 -

1.41 Increasing stock levels have also taken the utilization percentage of storage capacity beyond the normal level of 75Z as indicated below:

Year Capacity utilization (X)

1980-81 53 1983-84 65 1984-85 77 1985-86 80

Performance Highlights of FCI

1.42 Data relating to some important indicators of performance are given below:

1977-78 1980-81 1984-85 1985-86

Equity capital (Rs crores) Authorized 450.00 450.00 450.00 1,000.00 Paid-up 216.28 250.45 307.51 727.67 Reserves (Rs crores) 10.72 12.94 20.04 20.39 Net worth (Rs crores) 227.00 263.39 327.55 748.06 Capital employed (Rs crores) 2,359.82 1,998.20 5,210.95 5,250.80 Working capital (Rs crores) 2,238.33 1,823.63 4,907.04 4,857.89 Purchases: Quantity (Lakh tons) 129.89 132.67 188.72 211.22 Value (Rs crores) 1,899.69 2,633.39 4,389.98 5,386.20 Sales: Quantity (Lakh tons) 151.62 165.88 144.57 220.40 Value (Rs crores) 2,190.31 2,759.16 3,168.96 5,105.79 Turnover: Quantity (Lakh tons) 281.51 298.55 333.29 431.62 Value (Rs crores) 4,090.00 5,392.55 7,558.94 10,491.99 Covered storage capacity (Lakh tons) 135.58 157.69 1,960.92 207.95 Rail transportation (Lakh tons) 129.00 189.05 - 17 -

II. PROJECT IMPLEMENTATION

Original Project Content

2.1 The original scope of the project consistedof constructionof conventionalbagged godowns for a capacity of 2.5 million tons, flat bulk warehousesfor a capacity of 1 million tons and port silos installationsfor a capacity of 0.075 million tons. The bagged godowns componentof 2.5 million tons includeda capacity of 0.645 million tons completedearlier and picked up for retroactivefinancing under the project. In physical terms, the bagged godownswere proposed to be set up at 50 centers, flat bulk warehousesat 17 centers and the silos installationsat the two ports of Madras and Haldia.

2.2 The summary of the physical conteeitof the project is as follows:

No. of Capacity Component centers (million tons)

1. Bagged godowns (completedand picked up for retroactivefinancing) 87 0.645

2. Bagged godowns 50 1.855

3. Flat bulk warehouses 17 1.000

4. Port silos installations 2 0.075

Total 156 3.575

Start-up Period

2.3 At the time of Project Appraisal, it was envisagedthat land would graduallybecome availableat all the centers. The implementationschedule provided that land for the bagged godowns centers would become availableby December 1978 and for the flat bulk warehouses by July 1979. This did not, however, happen in reality. Though land was readily availablefor some centers and the constructionof warehousesat these centers also commencedas per schedule,subsequent non-available and/or protractedacquisition of land at many centershad a telling impact on the Project Performanceresulting in inevitableextension of the implementationperiod.

2.4 There was an initial delay to the extent of about 6 months in the signingof Credit Agreementbetween the World Bank and the Governmentof India. There was thus a correspondingextension in the date of commencement of the project from mid-July 1977 to the beginningof 1978. - 18 -

2.5 At the time of commencementof the project,works were undertaken only at 11 centers for a capacity of 0.425 million tons where land was readily available. The pace of implementationwas seriouslyaffected as land for the balanceof the centersdid not become availableas anticipatedat the time of appraisal. Even as late as in July 1980, land was availablein full only in respect of 31 bagged godown centers for a capacity of 1.168 million tons.

Revisionsin the Scope of the ProjectContent

2.6 By this time, the agriculturalpattern in the country had substan- tially changed,necessitating a review of the project content. The experience gained by the FCI in organizingrail movements from the Northern to the Eastern Region in large scale drought situationduring 1979 and 1980 also brought out the need to identifynew storagepoints.

2.7 In the meanwhile,the cost of essentialconstruction materials has also been increasingsteadily. The escalation in the prices of materials from 1977 to 1981 has been to the extent of nearly 30%. For the remainingcapacity of the bagged godowns yet to be tendered and awarded, furtherprice escalation had to be provided in view of the continuingrise in prices. Evidently,the estimatedproject outlay was consideredinadequate to provide the total storage capacity orginallyenvisaged at appraisal.

2.8 A review of the project content relating to the constructionof Flat Bulk Warehouseswas also considerednecessary in the light of the latest developmentsregarding provision of bulk grain wagons followingthe recommen- dations made by a high level Railway team after their overseas observation tour in 1980. As a result of this review, the provisionmade for flat bulk warehouseswas scaled down considerablyand changes in the scope and location of the Port Silos installationswere made to meet the demands of the changed situationprevalent at that time. To make up for the capacity of dropped centers, the componentof the conventionalbagged godowns was increasedfrom 2.5 million tons to 2.708 million tons. Due to the difficultiesexperienced in land acquisitionand also keeping in view the need-basedrequirements of storage capacity as relevant to the situationprevailing at that time. certain centers were either dropped or their capacity suitabilityaltered and additional centers were included. Fresh land acquisitionproceedings had, therefore, to be initiatedat this late stage in respect of the new centers which were added to the projectcontent.

2.9 The position of project content that emerged after the review of April 1981 was as follows: - 19 -

Capacity (milliontons)

Conventionalbagged godowns: Capacitycovered under retroactivefinancing 0.645 Land availableand works in progress 1.168 Capacity proposed to be augmentedat certain centers 0.225 New capacity added 0.670 Flat bulk warehouses 0.080 Port silos installations 0.050

Total 2.838

2.10 The provisionsmade for settingup of Port Silos installationsat Madras and Kandla with the modified design and scope and establishmentof flat bulk warehouseson a reduced scale were criticallyexamined both from financial and technicalconsiderations during a review of the project in November 1981. While the silos installationswere deleted from the project content for reasons of dwindling importsand due to limited scope for steady export programs, the flat bulk warehouseswere also deleted on the basis of the recommendationsmade by the high level Railway team regardingavailability of unit train bulk grain wagons. Along with these, the provisionsmade for rural procurementcenters and road carriers were also deleted.

2.11 The scope of the project was now confined to constructionof conventionalbagged godowns only. In order to make up for the shortfallin capacity that arose on account of deletion of capital intensivebulk storage components,the capacity of bagged godowns had to be necessarilyincreased.

2.12 The changed scope of the project content after this review of November 1981 was as follows: - 20 -

Capacity (milliontons)

Capacity (picked up for retroactivefinancing) 0.645 Capacity for which works were in progress 1.168 Capacity for which land was availablewithin the depot complexes 0.560 Capacity for which land was yet to be acquired 0.600

Total 2.973

2.13 The capital outlay of the revised project worked out to Rs 1,900 million. With the deletion of capital intensiveworks relating to Port Silos and Flat Bulk Warehousesfrom the project contents,the opportunityfor claiming 100% reimbursementfor F/M componentswas lost. As the reimbursement for civil works was limited to only 40%, it was evident that it would not be possible to claim full reimbursementfor the entire credit of US$107 million. The World Bank was, therefore,requested to disburse the reimbursement at 50X of the value of civil works retrospectivelyfrom the date of commencement of the project against the stipulated40%.

2.14 The World Bank agreed to the request of higher rate of reimbursement on a condition that the vouchers relating to expenditureincurred received by the Bank after September 1983 would only be eligible for reimbursementat 60% of the value of civil works. As it was not consideredfeasible to claim full reimbursementeven at this revised rate of disbursement,it was decided in early 1984 to include 105 centers to cover additionalconstruction to the extent of 0.610 million tons capacity. This resulted in a corresponding increase in the capital outlay from Rs 1,900 to Rs 2,250 million.

Final Project Content

2.15 The final scope of the project was confined to the constructionof bagged godown at 275 centers for capacity of 3.526 million tons including87 centers picked up for retroactivefinancing. The capital outlay is estimated to be of the order of Rs 2,250 million.

2.16 The summary of the final project content is as follows: - 21 -

No. of Capacity centers (milliontons)

Capacitypicked up for retroactivefinancing 85 0.645

Capacity firmed up in 1983 and added within the original outlay 83 2.271

Capacity added in 1984 with increasedoutlay 105 0.610

Total 3.526

ImplementationPeriod - Schedule vs Actual

2.17 The major factor that contributedto the time over-run was nonavailabilityand/or delayed acquisitionof land at differentstages of the project implementationperict. In most of the cases where land was available, the constructionwas completedwithin a reasonabletime frame.

2.18 The scope of the project.was firmed up in early 1983 and land for all the centers covered under the projectwas finallyavailable only in June 1983. The time taken to complete constructionafter this date up to the projectcompletion date of December 1985 was 30 months without consideringthe works that are still in progress uider risk and cost arrangements. This is within the time of 36 months provided by the World Bank in the implementation scheduleof the Project AppraisalReport.

2.19 The project was actually completed in December 1985 against the stipulateddate of December 1981. The balance works in respect of certain centerswhich were affected by delays on account of 'risk and cost' arrangements are still continuingand are expected to be completed in all respects during 1987-88.

Factors Contributingto Time and Cost Over-runs

Time over-run

2.20 The single major factor that largely contributedto the time overrun and consequentcost over-run has been the delay in land acquisition. The other factors that could be identifiedin this regard are:

(a) delay in the execution of railway sidings;and

(b) risk and cost action taken in respect of contracts rescindedat certain centers. - 22 -

2.21 Land. Non-availabilityand/or protractedacquisition of land inevitablypushed the project implementationinto a period of a completely changed agriculturalsituation in the country which brought out the need for revisionsof the project content for a rational investmentdecision. The constructionhad necessarilyto be phased out dependingupon the availability of land resultingin extended implementationperiod.

2.22 Railway Sidings. Siding facilitywas proposed to be provided for 44 centers under the project. In certain cases, delay in finalizationof siding plans by the Railways held up the commencementof works even after award of contractsfor the godowns as the plinth level of the storage structureshad to be fixed with referenceto the incoming rail level of the siding. In certain other cases, the rail levels indicatedearlier by the Railwayswere subsequently changed due to the modificationscarried out in their yard premises. This resulted in increasedquantum of work entailingmore time for execution.

2.23 The extent of long and narrow stretchesof land required for la-ring the approach track to the siding from the take-off point to the boundary of the storage complex could not be computedwithout approved siding plans resultingin delayed acquisition.

2.24 As a matter of policy, the Railways started insistingthat the siding should have facilitiesfor handling of a full rake within the storage complex. This meant identificationand acquisitionof a suitablepiece of land to accommodatea full rake which were difficultand time consuming.

2.25 Another policy introducedby the Railways related to the procurement of P-way materialsby the private siding owners themselves. This posed problems as there was considerabledelay in the supply of rails by M/s SAIL. Though these instructionswere subsequentlywithdrawn by the Railways,the damage had been done by then. The time over-run and consequentcost over-run had already taken place in the executionof siding works.

2.26 Risk and cost action resultingin protectedexecution of works. In respect of a few centers, contractshad to be terminatedon account of poor performanceby the contractorsand balance works carried out at the risk and cost of the defaultedcontractors. This resulted in protractedexecution of works even beyond the extended project completiondate of December 1985. (Gudivada,Itarsi, Panvel, Patiala, Nabha and Wardha.)

2.27 The followingfactors also contributedto the time over-run:

(a) Initialdelay in the commencementof the project. There was an initial delay to the extent of about 6 months in the signingof the agreementbetween World Bank and Governmentof India. As works could be taken up only after formal signing of agreementon January 6, 1978 the date of the commencementof the project in July 1977 as stipulatedin the implementationschedule of the Project AppraisalReport could not be adhered to.

(b) Larger number of bagged godown centers in place of Port Silos and Flat Bulk Warehousesdeleted from the scope. A larger number of - 23 -

bagged godown centers spread over many differentlocations had to be identifiedand included in the revised scope of the projectafter it was decided to delete the provisisionsmade for Port Silos and Flat bulk warehousesfrom the project content. Greater efforts in terms of projectplanning, supervisionof executionand allocationof resourceswere necessary in such works cf scatterednature as compared to the capital intensiveworks of port silos and flat bulk warehouses located in limitednumber of centers. Larger number of centers also contributedto the longer period of constructionto a certainextent.

Cost Overrun

2.28 The cost overrun has occurred as a consequenceof the time overrun that had already taken place mainly due to non-availabilityof land at several centers as late as in December 1981 when the project was scheduledto be completed. The other factors that contributedto the cost overrunwere as follows:

(a) Works had to be undertakenat increasednumber of centers to make up for the shortfallarising out of dropping the bulk componentsfrom the scope of the project. This meant considerabletime for prepara- tory works as the centers were also scatteredin differentparts. Besides this, the cost of works spread over many scatteredcenters worked out to be more than that which could have been obtained at a concentratedplace.

(b) The implementationschedule had to pass through periods of high price rise from 1980-81 onwards and the provisionof 7Z more towards annual price rise at the time of project appraisalwas extremely inadequateto meet the situation.

(c) The flat rate provisionof Rs 60/ton of storage towardsRailways siding was unrealisticallylow. The cost increasein respectof this segment alone has been to the extent of a staggering250%.

(d) The provisionof Rs 20/ton of storage for roads and site development and Rs 23/ton for ancillarybuildings was also very low.

(e) The 'risk and cost' action taken in respect of certain problem centers resulted in unavoidabletime and cost overruns.

Performanceof the ExecutingAgencies/Materials Suppliers, etc.

2.29 The works covered under the project were shared by different constructionagencies besides FCI as per the followingdetails: - 24 -

Capacity Agency No. of centers (milliontons)

FCI 111 1.597 CPWD 104 1.079 CWC 32 0.748 HPL 19 0.079 EPI 9 0.023

Total 275 3.526

2.30 Of these, CPWD is a central organizationand has been executing works concerningfood storage for a long time. CWC has also got experiencein this type of constructionfor quite some time. The other organizationsare public sector constructionagencies and were involved in the executionof food storageworks for the first time.

2.31 The works were entrustedto these agencies on 'depositbasis'. As the World Bank guidelinefor tendering,etc. were strictly followedby all the executingagencies, no problem was encounteredin the implementationstage and the performanceof each of these agencies was generallysatisfactory.

2.32 However, sporadic shortagesof essentialconstruction materials like cement, steel, AC sheets and tubular trussesdid affect the Project performanceto a certainextent. Productionconstraints in the factoriesdue to power cuts, etc., and subsequentmovement difficultiesowing to non- availabilityof rail wagons affected the supply position of cement considerably which in turn had an adverse effect on the progress of works.

2.33 There was a considerabledelay in the supply of AC sheets during 1981-82as the rate contract for a new term could not be finalizedby the DGS&D in time.

2.34 A bulk order for supply of tubular trusses was placed on DGS&D during 1982. Almost all the contractsfinalized by this CentralPurchase Organizationhad to be terminatedas no supplieswere forthcomingin spite of a very close follow-upwith the supplierslargely due to a steep hike in steel prices. The godowns though completedcould not be put to gainful use without the trusses and related components.

2.35 The progress of siding works entrustedto the Railways on deposits basis was also affected due to non-availabilityof rails. The Railways had stipulatedthat P. Way materialssuch 4.srails, sleepersand other fastenings should be procured by the siding owner and supplier to the Railways for incorporationin the work. Substantialtime overrun occurredas rails were not readilyavailable with M/S. SAIL and their rolling programalso got delayed considerably. This time overrun inevitablycontributed to the cost overrun that was to take place subsequently. - 25 -

2.36 It could be that the factors that contributedto the delayed supply of the above materialswere beyond anybody'scontrol. However, it is felt that the Projectdid not receive the right order of priority it deserved in regard to release of materials.If a higher priority had been allocatedby centralorganizations like Railway, SAIL, DGS&D, etc. in regard to execution of works and supply of materials to a need-basedgrain storageproject of this magnitudewhich was executed with financialassistance from the World Bank, the problems that were encounteredlater due to nonreceiptof materialsat times of requirementcould certainlyhave been reduced if not eliminated. To this extent, the experiencewith these organizationswas not satisfying.

Project Monitoring

2.37 The Projectwas subjectedto a very close monitoringof its physical and financialprogress at regular intervalsby the FCI management,the Depart- ment of Food (Ministryof Food and Civil Supplies)and the Departmentof Economic Affairs (Ministryof Finance). Periodicalreview meetings were also held in the Projects ImplementationDivision with the field Engineers,problem areas were identifiedand appropriateremedial measures decided to avoid spillagesin the schedules.

2.38 The progress of siding works was reviewedwith the concerned Engineersat the Railway Board level and also with the respectiveEngineers at the Zonal level.

2.39 The Projects performancewas also reviewed by the World Bank Review Mission which visited India for the purpose at frequent intervals. The formatsused for InformationReporting were suitablymodified to have a more meaningfuland action-orientedreview of progress of differentcomponents of the Project.

2.40 As a final scope of the Project contentwas confinedto the constructionof bagged godown only, severalalternatives for claiming full reimbursementof the scarce IDA aid of US$107 million were consideredand placed before the World Bank for concurrence.

2.41 Such periodicalreviews contributedsubstantially to the improved pace of implementationof the Project and also resulted in higher rate of reimbursementthough to a limited extent.

Role of Consultants

2.42 In terms of the relevant provisionsof the Credit agreement signed by the IDA and the Governmentof India, domestic consultantswere appointedto assist FCI Engineersin the preparationof layout plans, designs, tender documents, bid evaluationand to superviseconstruction of flat bulk warehouses and Port silos. The servicesof internationallyrecruited consultants for certain man-monthswere also availed as provided in the AppraisalReport.

2.43 A substantialportion of planningand design work relating to Port silos and some models of Flat bulk warehouseswas also completedby the local consultantswith the help of their foreign counterparts. At this stage, the - 26 -

revision in the scope of the Project content was being consideredseriously by the FCI Managementand the Departmentof Food due to the changed agricultural situationbrought about by the factors such as bumper crops in the grain producingstates, difficulties in moving grains to drought affected states in the Eastern Region and problems in land acquisitionfor several centers and also on account of the continuingrise in prices contributingto the steady cost overrun of the project.

2.44 As the componentsrelating to the flat bulk warehouses and Port silos were finallydeleted from the scope of the Project, the servicesof the consultantswere also discontinued. However, certain basic designs developed by them in respect of differentmodels of flat bulk warehousescould always be made use of as and when such installationsare taken up for execution.

Research and Development,Operations Research and Training

2.45 As envisagedat the time of Projectappraisal. onerationsresearch studieswere conductedto ascertaincomparative costs and ben;-Fitsof receiving,handling, storage and transportationof grain in bulk from in relation to the existing bag handling system. A study report was also completed in this regard.

2.46 It was also provided that designswould be developedfor special rail wagons for suggestingmodifications to the existing wagons, etc. In accordancewith these provisions,a high level Railway team had gone on an overseas observationtour in 1980 to select and subsequentlydesign the type of grain wagons for use in this country, the team discounted the suggestions made for the use of modified flat bed wagons fitted with paper retentiondoors and insteadrecommended special bulk grain wagons only for handling and movement of bulk grain. As the availabilityof the first unit train with such specialwagons was expected only towardsthe end of the plan period and the componentsrelating to flat bulk warehousesand Port silos were subsequently deleted from the scope of the Project content, these recommendationswere not pursued further.

2.47 The provisionmade for both domestic and overseas trainingmeant essentiallyfor training experts in the operationand maintenanceof flat bulk warehousesand Port silos after such installationswere completedas originally envisagedas it was thought that FCI Engineersand Indian Engirnering serviceshad only limitedexperience in bulk grain handling systems. As the scope of the Project content was confined to the constructionof bagged godowns only consequentto the deletion of bulk storage components,the training facilitiesprovided at the time of Project appraisalwere not availed. However, the overseas trainingavailed by a team of middle level Managers of the Engineeringand Quality Control disciplinesin similar bulk storage installationsof USA, Canada and Australiaunder the first Wheat Storage Project (Credit267-IN) financed by the World Bank jointlywith Sweden was consideredfor reimbursementof expenditureunder this Project.

2.48 Though the recommendationsmade in the operationsresearch study report and by the high level Railway team were not pursued and the overseas training facilitieswere not availed as provided mainly due to the deletion of - 27 -

the bulk storage componentsof the Project, it is felt that the studies already completedand the trainingavailed under the Wheat Storage Project are expected to be of immense use in our continuingefforts to create such bulk grain handling facilitiesin the country in the near future.

III. ECONOMICAPPRAISAL

3.1 The project has contributedin a significantmanner as has been highlightedin Part I, in managing the national food security system. Storage capacitycompleted in Phase II has augmentedsubstantially the capacity of FCI in expendingthe network of foodgrains. Some of the importantbenefits of the projectare:

(a) Storage capacity has been providedat 273 centers in the project. These centers have expanded the network of godowns and facilitated price support operations in surplusareas and distribution capabilityin deficit areas. Physical positioningof stocks in deficitareas not only assessed requirementand adequate availabilityof foodgrainsbut also confiLanedspeculative price increases.

(b) Scientificstorage capacitywould help in reducing losses inevitable in sub-optimaltype of storage in 'CAP'. Losses are estimated to be comparativelyless by 2% in godowns. For 3 million tons foodgrain stocks which can be accommodatedin capacity provided by the project, the loss avoidance is estimatedto be 60,000 MTs p.a.

(d) Create more employmentpotential during constructionand later in operation.

3.2 Constructionof storagecapacity continuesto be a priority project in the VII Plan also. Addition made with the project,during the Vth and VIth Plan periodshas given an impetusto storage constructionprogram.

3.3 EconomicReturn. An attempt has been made to compute the Internal j Rate of Return (IRR) based on the actual cost of the project. Details are discussedbelow:

Method. To compute the internal rate of return of the project, two alternativesituations have been assumed. If 3.526 million tons storage capacitywas not constructedin the project period, given the level of stocks, inevitablefoodgrain stocks would have been stored in 'CAP' (Cover and Plinth) storage complex. Such an alternativewill have less initial capital costs, but very high operationalcosts in view of their sub-optimallocations and higher percentageof storageloss. With such an alternativesituation of "without the project" is comparedwith the situationof providing - 28 -

3.526 million tons conventionalgodown capacity. This situation "with the project" would involvecomparatively more capital cost initiallyand less operationalcosts and storage loss.

3.4 To determinethe net advantageof the situation"with the project", net cost flows of 'Conventionalgodown complex' over the 'CAP complex' have been computed over the years and IRR determined.

3.5 This method is similar to the one adopted in FCI's original project report and the World Bank's AppraisalReport.

Capital Cost

(a) Project outlay for 3.526 million tons conventionalgodown capacity for bag storage. Rs. 1,723.5million (Actual) Per ton cost - Rs 489

(b) Project outlay on railway siding with godown units having 2.038 million tons capacityRs 526.5 million (Actual) Per ton cost - Rs 258

Total average capital cost per ton for conventionalgodown with railway siding Rs 747

(c) Road topping/civilworks are expected to cost similar amount for both 'CAP' complex and a conventionalgodown. Hence in working out the net IRR--thesecost flows have been ignored.

(d) Similarlyother maintenancecosts for electricalworks, etc. for both CAP and conventionalgodowns are assumed to be almost the same. Hence, the differencein cost flows have been ignored. Even if one takes the exact cost flows, the overall impact on IRR would only be negligible.

(e) Salvage value of the godown in the 25th year has been taken to be one-thirdof the original cost of Rs 747 per ton. The life assumed is 35 years and the salvagevalue at the end of 25th year estimated at one-thirdwould be reasonable,in view of land and railway siding components in the godown complex.

(f) As compared to Rs 747 per ton cost of conventionalgodown, the capital cost estimatedfor 'CAP' complex is estimatedto be Rs 100 per ton. Hence the difference in capital cost of the two alternativesituations, i.e. 'with the project' and 'withoutthe project' has been computed.

RecurringCost

(a) Operationalcosts. Operationaland distributioncosts per annum per ton for 'CAP' and 'godown'complex are estimatedto be Rs 171.20 and Rs 82.06. The costs for 'CAP' are more than double on account of: - 29 -

sub-optimallocations requiring extra transportationcost, additional transportationcost from the railway station to the 'CAP' complex ('godown'are provided with railway siding facilitiesand hence no such extra transportationcost); more deteriorationof grains in the open, more expenditureon spraying,etc.

(b) Storage loss. Storage loss per annum for these two alternative situationsis assessed at 3% for CAP and 1% for godown. Foodgrains kept in 'CAP' are 'paddy'and 'wheat'. The average price for grain adopted is Rs 2,000 per ton.

3.6 InternalRate of Return (IRR). Base on the above, IRR has been computed to be 19.9%. In the World Bank's Appraisal report, the IRR computed for similarcomplex (Model A) is also around the same level of 19.7%. The estimatedIRR at the beginningof the project has in fact come to hold good even after the completionof the project. IRR of 19.9% can be consideredas reasonablygood.

IV. CONCLUSIONS

Project PerformanceEvaluation

I w~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ 4.1 The projectwith an estimatedcapital outlay of Rs 1,900 million and an implementationperiod of 4½ years from July 1977 to December 1981 was actually completed in December 1985 with an expected capital outlay of Rs 2,250 million. The reasons for these time and cost overruns have been brought out in the write up under the head 'Project Implementation'of this report.

4.2 Despite these time and cost overrunswhich were beyond controlunder the circumstancesexplained in the report, the Project has achieved its basic objectivesof providingneeded grain storage facilitiesand has made a sizeable contributiontowards buffer stock holding capacity of foodgrainsin keeping with the policy of the Governmentof India.

4.3 Although the bulk storage componentsrelating to flat bulk warehouses, Port grain silos, transportequipment, etc. were deleted from the Project content, the experiencegained, particularlyin respectof the initial designs and grain flow diagrams and proposed systemsdeveloped by the consultants for port silos and for certain cost effectivemodels of flat bulk warehouses, is expected to be useful in the implementationof future projects with such installations.

4.4 Due largely to nonavailabilityand protractedacquisition of land at several centers covered under the Project, the implementationschedule got extended into a period of changed agriculturalsituation of the country necessitatinglarge scale changes in the scope of the project content for more rational investment. Once the project contentwas firmed up in early 1983, the pace of implementationwas also accelerated. The World Bank review mission which has been reviewingthe progress to regular intervalsalso took note of this phenomenonand had left a note of commendationin their Aide -30 -

Memoire while agreeing to extent the Credit closing date on the basis of improvementsmade in the Project Implementation. However, as the major time overrun had already taken place due to non-availabilityof land and also on account of the substantialchanges made in the scope of the project content, the consequentcost overrun could not be preventedthough the negative trends in this segmentwere containedto certain extent.

4.5 In keepingwith the demands of the changed agriculturalsituation during the course of implementationof the project, the decisionstaken at differentstages to modify the scope of the project contentwith the concurrence of the World Bank are consideredjustified. The completionof construction of Port silos as envisagedat the time of ProjectAppraisal would have proved irrelevanttoday in the context of steady surplusproduction of grain year after year in the country as these installationswere intended to receive imported grain at the two ports of Madras and Haldia. On similaranalogy, the setting up of flat bulk warehousewould not also have served the purpose fully as the mode of procurementoperations at the regulatedmarket yards continues to be in the conventionalform even today. In retrospect,therefore, these decisionshave proved to be sound and the investmentsmade on the bagged godowns turned out to be more rational.

Lessons Learnt for Implementationof Future Storage Projects

4.6 Land Availability. The experiencein acquisitionof land for the main structuresand also for the rail siding continues to be frustrated. As the acquisitionproceedings are generallylong-drawn and time-consuming,it is considereddesirable to have a firm commitmenton the availabilityof land for a substantiallylarge number of centers even at the time of appraisalof the project. Acquisitionproceedings for the balance centers should also be commenced immediatelythereafter to ensure availabilityof land at all centers at the time of scheduledcommencement of the Project. Long and narrow stretchesof land for the approach track of the incoming rail siding should also be acquired and handed over in time so that the storage is put to gainful use with all related facilitiesimmediately on completion.

4.7 Changes in the Scope of the Project Content. Large scale revisions in the scope of the project contentduring the course of implementationcause several setbacks as have occurred in this project. The decision to reduce the extent of and later delete the capital intensivebulk storage componentsfrom the project content has inevitablyresulted in the identificationof a larger number of bagged godowns storage points where the difficultand time-consuming process of land acquisitionhad to be encounteredat time when the entire project was scheduledto be completed.

4.8 As such changes tend to contributesubstantially to subsequenttime and cost overruns, it is considereddesirable that the content once firmed up at the appraisal stage, should not ordinarilybe changed. Even if a need for revision arises, the changes should be minimal so as to ensure that the estimated implementationperiod and also the capital outlay are kept within reasonablevariations on actual completionof the project. - 31 -

4.9 Changes in the Location of Centers. As stated earlier, the changed agriculturalpattern in the country in general and the large scale drought situationin the Eastern region during 1979-80in particular broughtout the need for locatingnew storage points. In the process, preliminaryworks undertakenat some of the centers had to be abandoned. This has resulted in infructuousexpenditure which could have been avoided. It is, therefore, consideredthat changes in the location of centers,once approved that where works are taken up, should be avoided to the extent possible.

4.10 TenderingProcedure. As stipulatedby the World Bank, prospective bidders for the constructionof even conventionalgodowns and ancillarieswere prequalifiedon the basis of certaincriteria in regard to works experience, annual turnover,financial capability, etc. before invitationof tenders. This procedureresulted in limited competitionand rather poor tender response. As one or two tenders only respondedto the bid invitationin a particulararea, contractsawarded to them at certain centers had to be terminatedon account of slow process and balance works executed at 'risk and costt arrangementswhich are usually time consuming.

4.11 When the matter was taken up with the World Bank, it was readily agreed to and open tenderswere invitedfor the balance works. However, certain minimum standardsin regard to previous works experiencewere set to ensure that only bidders with proven works experienceparticipated in the tender inquiry. This system worked satisfactorily. For further projects, this position may be clarifiedto the Bank right at the time of Appraisal for suitable incorporationin the relevant documents.

4.12 InterdepartmentalCoordination. As broughtout elsewherein the report, the experiencewith other departmentssuch as Railways,DGS&D, SAIL, etc. was not very satisfyingin that a need based grain storage project of this kind executed with financialassistance from the World Bank did not receive the due priority it rightly deserved in regard to release of materials. In spite of the best coordinationand follow up at different levels of the managementwith these organizations,the progress of siding works and release of essentialmaterials like AC sheets, tubular trusses and rails did not turn for the better throughoutthe period of implementation. As a result of this, procurementof trussesand related componentswas withdrawn from DCS&D and undertakenby FCI directly. The procurementof rails and other P-way materials for the railsidingshas now rightly become the responsibility of the Railways. As regards siding works, it is felt that a marginallyhigher priority by the Railways will certainly improvematters.

4.13 Experiencegained in implementingthe project, particularlyin land acquisition,phasing of the project, time scheduleof construction,estimates of costs and their escalation,etc., would be of immensehelp in designing the continuing constructionprograms in the coming years. To augment storage capacity further in the VII plan period, a target of 7.5 million tons has been set for all the Governmentagencies. ANNEX G

32-- Table 1

INDIA

SECONDFOODGRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Production of Foodgrains (Million tons)

Year Foodgrain Cereals Wheat Rice

1955/56 66.85 57.09 8.76 27.56 1956/57 69.85 55.80 9.40 29.04 1957/58 64.31 58.30 8.00 25.52 1958/59 77.14 54.75 9.96 30.85 1959/60 76.67 64.00 10.32 31.68 1960/61 82.02 64.87 11.00 34.57 1961/62 82.71 69.31 12.07 35.66 1962/63 80.15 70.95 10.78 35.21 1963/64 80.64 68.62 9.85 37.00 1964/65 89.35 70.`1 12.26 39.30 1965/66 72.35 76.94 10.42 30.65 1966/67 74.23 62.23 11.39 30.63 1967/68 95.01 65.88 16.54 37.61 1968/69 94.01 82.95 18.65 39.76 1969/70 99.50 87.81 20.01 40.43 1970/71 108.42 96.60 23.83 42.23 1971/72 105.17 94.07 26.41 43.07 1972/73 97.03 87.12 24.73 39.25 1973/74 104.67 94.66 21.78 44.05 1974/75 99.83 89.81 24.10 39.58 1975/76 121.03 108.00 28.85 48.74 1976/77 111.17 99.81 29.01 41.92 1977/78 126.41 114.43 31.75 52.67 1978/79 131.90 119.72 35.51 53.77 1979/80 109.70 101.13 31.83 42.33 1980/81 129.59 118.96 36.31 53.63 1981/82 133.30 121.79 37.45 53.25 1982/83 129.52 117.66 42.79 47.12 1983/84 152.37 139.48 45.48 60.10 1984/85 145.54 133.58 44.07 58.34 1985/86 150.47 137.51 46.88 64.15

Source: Ministry of Food and Civil Supplies (Departmentof Civil Supplies). ANNI U 33 Table 2

INDIA

SECOND FOODGRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Compound Growth Rates of Area, Productionand Yield of Foodgrains (% p.a.)

1949/50 - 1983/84 1967/68- 1983/84 Crops Area Production Yield Area Production Yield

Rice 0.92 2.46 1.53 0.64 2.27 1.62

Wheat 2.80 6.02 3.12 2.68 5.77 3.00

Jowar -0.16 1.37 1.53 -0.76 2.04 2.82

Bajra 0.34 2.13 1.79 -0.79 0.70 1.51

Maize 1.86 2.63 0.75 -0.05 0.66 0.70

Ragi 0.27 1.84 1.57 0.61 2.79. 2.18

Small millets -0.77 -0.90 -0.13 -1.79 -1.23 0.57

Barley -2.04 -0.80 1.27 -4.50 -3.01 1.54

Coarse cereals 0.46 1.47 1.28 -0.89 0.91 1.75

Total Cereals 0.84 2.96 1.77 0.37 2.87 2.04

Gram -0.55 Neg. 0.55 -0.35 -0.51 -0.19

Tur 0.60 0.26 -0.35 0.99 1.38 0.39

Other pulses 0.80 0.47 -0.33 0.85 0.79 -0.06

Total Pulses 0.33 0.23 0.08 0.47 0.35 -0.02

Total Foodgrains 0.74 2.61 1.56 0.38 2.61 1.84

Source: Directorateof Economicsand Statistics,Ministry of Agricultureand Rural Development. ANNEX G -34 - Table 3

INDIA

SECOND FOODGRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

All-India Production,Procurement of Imports and Distributionof Foodgrains ('000 tons)

Net Net Year production Procurement imports Distribution Difference (1) (2) (3) (4) (2) - (4)

1961 72,040 540 3,490 3,980 (3,440) 1962 72,100 480 3,630 4,370 (3,890) 1963 70,290 750 4,540 5,180 (4,430) 1964 70,610 1,430 6,250 8,670 (7,240) 1965 78,200 4,030 7,440 10,080 (6,050) Total 363,240 7,230 25,350 32,280 (25,050) 1966 63,300 4,010 10,310 14,090 (10,080) 1967 64,950 4,460 8,660 13,770 (8,710) 1968 83,170 6,810 5,670 10,220 (3,410) 1969 82,260 6,380 3,820 9,390 (3,010) 1970 87,060 6,710 3,550 8,840 (2,130) Total 380,740 28,370 32,010 55,710 (27,340) 1971 94,870 8,860 2,010 7,820 1,040 1972 92,020 7,670 (500) 10,490 (2,820) 1973 84,900 8,420 3,590 11,410 (2,990) 1974 91,580 5,650 5,160 10,790 (5,140) 1975 87,350 9,560 7,540 11,250 9,310 Total 450,720 40,070 17,800 51,760 (11,690) 1976 105,900 12,850 6,920 9,170 3,680 1°77 97,270 9,940 490 11,740 (1,800) 1978 110,610 11,090 (630) 10,180 910 1979 115,410 13,840 (860) 11,660 2,180 1980 95,990 11,170 (350) 14,990 (3,820) Total 525,180 58,890 5,570 57,740 1,150 1981 113,390 12,980 630 13,010 (30) 1982 116,630 15,420 1,580 14,770 650 1983 113,330 15,670 4,070 16,210 (440) 1984 133,330 18,720 2,370 13,340 5,380 1985 127,950 20,000 (320) 14,070 5,930 Total 604,630 82,790 8,330 71,400 11,390

Note: There have been net exports during 1972, 1978-80and 1985. ANNEX G 35 -Table 4 INDIA

SECONDFOODGRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Net Availability,Procurement and Public Distributionof Foodgrains (Million tons)

Net Net produc- availa- tion of bility Public Col. 2 Col. 4 Col. 5 food- Net of food- Procure- distri- as % of as Z of as % of Year grains imports gra.lns/a ment bution col. 3 col. 1 col. 3 (1) (2) (3) (4) (5) (6) (7) (8)

1956 60.67 1.37 62.64 0.04 2.08 2.2 0.1 3.3 1961 72.04 3.49 75.69 0.54 3.98 4.6 0.7 5.3 1962 72.10 3.63 76.08 0.48 4.37 4.8 0.7 5.7 1963 70.29 4.54 74.85 0.75 5.18 6.1 1.1 6.9 1964 70.61 6.25 78.11 1.43 8.67 8.0 2.0 11.1 1965 78.20 7.44 84.57 4.03 10.08 8.8 5.2 11.9 1966 63.30 10.31 73.48 4.01 14.09 14.1 6.3 19.2 1967 64.95 8.66 73.87 4.46 13.17 11.7 6.9 17.8 1968 83.17 5.67 86.81 6.81 10.22 6.6 8.2 11.8 1969 82.26 3.82 85.62 6.38 9.39 4.5 7.8 11.0 1970 87.06 3.55 89.49 6.71 8.84 4.0 7.7 9.9 1971 94.87 2.01 94.31 8.86 7.82 2.1 9.3 8.3 1972 92.02 (0.50) 96.22 7.67 10.49 (0.5) 8.3 10.9 1973 84.90 3.59 88.79 8.42 11.41 4.0 9.9 12.8 1974 91.58 5.16 97.14 5.65 10.79 5.3 6.2 11.1 1975 87.35 7.54 89.33 9.56 11.25 8.4 10.9 12.6 1976 105.90 0.67 95.83 12.85 9.17 6.6 12.1 9.0 1977 97.27 0.10 99.00 9.87 11.73 0.1 10.2 11.8 1978 110.61 (0.60) 110.25 11.10 10.18/b (0.5) 10.0 9.2 1979 115.41 (0.20) 114.85 13.84 11.667Wc (0.2) 12.0 10.2 1980 95.99 (0.34) 101.43 11.17 14.997W (0.3) 11.6 14.8 1981 113.39 0.63 114.26 12.98 13.017W 0.6 11.4 11.4 1982 116.63 1.58 116.88 15.35 14.777Wb 1.4 13.2 12.6 1983/c 113.33 4.07 114.74 15.66 16.21f/b 3.5 13.8 14.1 19847W 133.33 2.37 128.63 18.72 13.347Wb 1.8 14.0 10.4 19857Wc 127.95 (0.32) 126.50 20.00/d 14.07 (0.3) 15.6 11.1

/a Net availability- net production+ net imports- change in governmentstocks. 7b Includesquantities released under the Food for Work program. 7TW Provisional. Td Up to November 1985.

Note: Productionfigures relate to agriculturalyear; 1956 figures correspondto 1955/56and so on. Figures for procurementand public distributionrelate to calendar years.

Source: Economic Survey, 1985/86. ANNEX G - 36 - Table 5

INDIA

SECOND FOODGRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETION REPORT

All-India Procurement of Rabi/Kharif Foodgrains (Marketing Year-Wise) from 1964/65 to 1984/85 ('000 tons)

Kbarif Rabi Rice Total (including in Total Grand Wheat cereals Paddy terms of rice) cereals total

1964/65 94 94 388 2,899 3,347 3,441 1965/66 463 466 988 3,137 5,755 4,221 1966/67 198 198 673 2,469 3,143 3,341 1967/68 893 988 1,289 3,233 4,004 4,992 1968/69 2,298 2,337 1,359 3,433 3,897 6,234 1969/70 2,387 2,387 1,329 2,943 3,217 5,604 1970/71 3,192 3,199 1,432 3,197 3,682 6,881 1971/72 5,101 5,112 1,639 3,116 3,297 8,409 1972/73 5,006 5,014 1,057 2,706 3,017 8,031 1973/74 4,531 4,536 1,989 3,887 4,274 8,810 1974/75 1,955 1,975 2,115 3,795 4,097 6,072 1975/76 4,049 4,055 3,461 6,322 6,632 10,687 1976/77 6,602 6,629 1,332 4,431 4,653 11,282 1977/78 5,165 5,179 1,501 4,853 4,874 10,053 1978/79 5,477 5,490 3,204 6,334 6,459 11,949 1979/80 8,000 8,010 2,686 3,851 3,963 11,973 1980/81 5,861 5,861 4,579 5,609 . 5,711 11,572 1981/82 6,595 6,607 3,801 7,334 7,555 14,162 1982/83 7,718 7,720 3,267 7,047 7,219 14,939 1983/84 8,292 8,299 2,682 7,731 7,771 16,070 1984/85 9,300 9,305 4,053 9,850 10,061 19,366 1985/86/a 10,345 10,355 5,223 9,814 9,911 20,266

/a Provisional.

Sources: Bulletin on Food Statistics, Directorate of Economics and Statis- tics, Ministry of Agriculture; Department of Food. 37 - ANNEX G Table 6

INDIA

SECOND FOODGRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETION REPORT

Total Offtake (Distribution) of Foodgrains from Government Stocks (All-India) ('000 tons)

Wheat Rice Coarse grains Total

1951 3385 3,076 1,520 7,981

1961 2,983 950 44 3,977

1971 4,455 3,230 131 7,816 1972/a 7,413 3,688 295 11,396 1973 7,130 3,206 1,078 11,414 1974 5,669 3,753 1,368 10,790 1975 7,545 3,211 497 11,253 1976 5,015 3,643 516 9,174 1977 6,396 4,589 744 11,729 1978 6,855 3,229 99 10,183 1979 7,493 4,049 121 11,663

1980 8,819 6,057 117 14,993 1981 6,427 6,402 185 13,014 1982 7,168 7,500 100 14,768 1983 8,121 7,853 232 16,206 1984/b 6,505 6,730 91 13,326 198571 8,477 7,231 91 15,799 19867wc 9,600 3,400 300 18,300

/a Including export under Gift/Aid to Bangladesh.

/b Provisional.

/c Estimated. ANNEX G - 38 - Table 7

INDIA

SECOND FOODGRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETION REPORT

Index Numbers of Wholesale Prices of Foodgrains(Annual Average) (Base: 1970/71 - 100)

All commodities Foodgrains Cereals ITheat Rice

1971 105.2 102.1 100.9 97.8 103.3

1972 113.0 114.6 111.4 103.3 112.1

1973 131.6 135.0 128.0 108.0 131.6

1974 169.2 183.6 178.1 163.9 174.7

1975 175.8 187.0 185.7 168.4 188.2

1976 172.4 150.3 151.6 150.6 154.9

1977 185.4 167.2 161.2 155.8 163.6

1978 185.0 173.3 158.1 154.8 150.0

1979 206.5 179.8 167.0 158.8 175.3

1980 248.8 207.3 189.5 169.9 201.5

1981 278.4 236.1 213.1 190.0 220.6

1982 285.3 242.5 229.4 203.3 247.6

1983 308.5 270.4 259.8 223.1 290.1

1984 338.0 275.4 247.0 211.6 275.5

1985 353.0 289.4 255.4 218.8 281.6

1986/a 367.0 296.9 270.8 233.9 289.9

/a Average of eight months--January to August 1986. INDIA

SECOND FOODGRAINSTORAGE PROJECT (CREDIT 747-IN)

PROJECTCOMPLETION REPORT

Pattern of ProcurementPrices of Foodgrainsin India (Rs/quintal)

Paddy Market- Super- Rice lng year Wheat Common Fine fine Jowar Bajra Maize Ragi Coarse Fine Superfine (Apr-Mar) (Oct-Sep) -(------(All-Indiarange) --- -

1975/76 105 /a - - 74 74 74 74 - - 1976/77 105 74 - - 74 74 74 74 - - - 1977/78 110 77 - - 74 74 74 74 - - _ 1978/79 112.50 85 - - 85 85 85 85 - - 1979/80 115 95 99 103 95 95 95 95 149.50/159.50 155.50/170.75 165.00/180.00 1980/81 117 105 109 113 105 105 105 105 164.50/175.25 170.25/187.25 177.50/195.20 1981/82 130 115 119 123 116 116 116 116 176.00/194.70 182.50/207.t5 188.50/215.35 1982/83 142 122 126 130 118 118 118 118 186.00/205.95 192.50/218.60 198.50/226.90 1983/84 151 132 36 140 124 124 124 124 200.00/221.00 206.50/235.40 212.50/243.40 1984185 152 137 141 145 130 130 130 130 210.60/231.90 216.40/245.45 222.15/253.90 1985/86 157 142 146 150 130 130 130 130 217.85/241.90 223.60/255.85 229.40/264.45 1986/87 162 146 150 154 - - - - 223.60/248.30 229.40/258.95 235.20/271.15

/a Varied from state to state for different varieties.

Source: Bulletinon Food Statistics,Directorate of Economicsand Statistics,Department of Agricultureand Coopera- tion, Ministryof Agriculture.

!~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~t ANNEX G -40- Table 9

INDIA

SECONDFOODGRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Stocks of Foodgrainswith Centraland State Governments and Stocks in Pipelinps ('000 tons)

At the begin- Total ning of Rice Wheat Coarse grains foodgrains

July 1975 1,593 4,210 161 5,964

July 1976 5,120 11,959 904 17,683

July 1977 5,592 14,642 513 20,747

July 1978 6,577 12,229 105 18,911

July 1979 9,627 11,728 149 21,504

July 1980 7,090 9,003 141 16,234

July 1981 5,839 7,733 103 13,675

July 1982 5,118 10,164 196 15,478

July 1983 3,781 13,013 168 16,962

July 1984/a 4,610 17,833 49 22,492

July 1985/a 7,750 20,732 172 28,654

July 1986/a 9,450 19,210 140 28,800

/a Provisional.

Source: Departmentof Food, Ministry of Food and Civil Supplies. INDIA

SECONDFOODGRAZN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Growth Pattern of Storsae Accommodationwith FCI * ('000tons)

Covered accommodationshired from Total Crand Private parties owned & total Financial State Under ARDC Total hired Capacity/open covered b year-end Owned CwC SWC gov ts General scheme hired (covered) Owned Hired Total capacity

1965/66 568.50 - - - - - 49.09/a 617.59 - - - - 1966/67 1,052.40 - - - - - 601.6671a 1,654.06 - - - - 1967/68 1,243.15 - - - - - 733. l7a 1,976.16 - - - - 1968/69 2,424.90 675.68 349.73 1,343.10 b - 2,365.51 4,790.41 - - - - 1969170 2,812.75 798.23 232.85 1,727.87 2,758.95 5,571.70 - - - - 1970/71 3,451.49 635.00 290.15 1,873.35 71 - 2,798.50 6,249.99 - - - - 1971/72 4,044.64 696.56 746.59 579.47 2,199.96 - 4,2?2.58 8,267.22 8.60 - 8.60 8,275.82 ' 1972/73 4,759.20 746.41 255.42 520.61 1,627.58 - 3,150.02 7,909.22 16.69 - 16.69 7,925.91 1973/74 5,146.77 840.44 270.66 518.38 1,086.63 - 2,716.11 7,862.88 496.98 - 496.98 8,359.86 1974/75 5,344.23 528.85 155.14 612.45 685.26 - 1,981.70 7,325.93 532.91 - 532.91 7,858.84 1975/76 5,470.51 877.36 852.00 709.74 1,296.43 - 3,735.53 9,206.04 1,078.88 913.30 1,992.18 11,198.22 1976/77 5,857.10 1,089.37 1,240.56 990.50 2,265.02 /c 5,585.45 11,442.55 1,852.99 5,671.45 7,524.44 18,966.99 1977/78 6,457.53 1,128.06 1,183.79 779.58 4,054.72 7c 7,100.15 13,557.68 1,615.59 5,610.78 7,226.37 20,784.05 1978/79 7,239.76 1,126.81 1,094.94 820.28 1,018.00 4,165.00 8,225.03 15,464.74 1,289.99 5,303.07 6,693.06 22,057.85 1979/80 7,587.08 980.11 1,009.03 780.52 976.67 4,846.91 8,590.24 16,180.32 1,288.45 5,459.57 6,748.02 22,928.34 1980/81 7,757.24 811.59 761.30 676.21 624.65 5,138.30 8,012.05 15,769.29 1,238.46 3,782.76 5,021.22 ?1),790.51 1981/82 7,934.77 1,059.26 751.31 679.32 506.62 5,010.76 8,007.27 15,942.04 1,193.11 1,217.46 2,410.57 X ,350.61 1982/83 8,206.41 1,354.11 731.73 760.44 804.03 4,216.13 7,866.44 16,072.85 1,112.37 957.83 2,070.20 18,143.05 1983/84 8,544.62 1,573.44 1,069.45 748.61 1,643.47 3,516.58 8,551.55 17,096.17 1,056.88 472.02 1,528.90 18,625.07 1984/85 9,174.89 1,968.48 2,145.96 878.78 2,770.94 2,752.95 10,517.11 19,692.00 798.21 1,779.19 2,577.40 22,269.40 1985/86/d 10,105.49 2,099.07 2,280.47 732.08 2,935.66 2,702.47 10,800.06 20,905.55 1,366.78 2,745.84 4,112.60 25,018.15 1985/86e 10,365.82 2,038.30 2,195.93 758.49 2,591.00 2,843.84 10,428.96 20,794.78 1,332.30 2,341.52 3,673.82 24,468.60

/a Agency-wisesplit not available. 71iSeparate details not available. Included In capacities shown against state governments. _ Not available. The scheme for constructionof scientific storages by the private parties for leasing to the Corporationon guaranteed occu- pation basis was launched In 1976/77 only. /d As okfDecember 31, 1985. Te As of Karch 31, 1986. ANNEX P Table I

INDIA

SECOND FOODGRAINSTORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Details of Proposed and Actually Constructed Storage Capacities - Abstract ('000tons)

Storage Capacity actually constructed capacity proposed under the project Conventlonal godo us Conventional Flat bulk Port Agreed S.lected Flat bulk Port Zone/region godowns varehouses silos Total RA works sites sites varehouses silos Total

North Zone Ia Haryana 100.00 105.00 - 205.00 5.00 233.34 94.26 - - 332.60 Punjab 250.00 157.50 - 407.50 144.68 501.68 149.15 - - 795.51

Rajasthan 75.00 - - 75.00 15.00 46.68 21.40 - - 83.08

Uttar Pradesh 200.00 262.50 - 462.50 70.33 180.00 71.60 - - 321.93

Jammu& Kashltr - - - - 10.00 5.00 6.68 - - 21.68 Delhi ------25.00 - - 25.00

Subtotal 625.00 525.00 _ 1.150.00 245.01 966.70 368.09 - - 1,579.80

South Zone Andhra Pradesh 150.00 52.50 - 200.50 44.24 280.50 45.26 - - 370.00 Karnataka 50.00 - - 50.00 1.67 85.00 6.09 - - 92.67

Kerala 155.00 - - 155.00 16.70 112.84 - - - 129.54

Tamil Nadu &50.00 - 25.00 175.00 53.34 170.00 - - - 223.34

Subtotal 505.00 52.50 25.00 580.50 115.95 648.34 51.35 - - 815.64 East Zone Bihar 175.00 52.50 - 227.50 17.93 50.00 3.34 - - 71.27

Ortssa 75.00 - - 75.00 20.00/9.5 50.00 16.28 - - 86.28

West Bengal 150.00 52.50 50.00 252.50 - 80.00 5.00 - - 85.00

Assam - - - - 20.00 - - - - 20.00

NE? - - - - 5.00 - - - - 5.00

Subtotal 400.00 105.00 50.00 555.00 62.93 180.00 24.62 - - 267.55 West Zone Cujarat 75.00 - - 75.00 - 60.00 34.76 - - 94.76 Madhya Pradesh 125.00 157.50 - 227.50 173.25 175.00 101.71 - - 449.96

Maharaghtra 125.00 160.00 - 285.00 47.50 240.00 30.00 - - 317.50

Subtotal 325.00 317.50 - 637.50 220.75 475.00 166.47 - 862.22

Total 1,855.00 1,000.0O 75.00 2.930.00 644.64 2.270.04 610.53 - _ 3.525.21

/a The cumulative capacity completed up to March 31, 1986 is 3,260.825 tons. A capacity of 122,240 tons is targeted for completion during 1986/87 and the balance 142,140 tons projected for completion during 1987/88. ANNEXP 43_ _ Table 2. 43 ~~~~~~~~P4 gelI

INDIA

SECONDFOODGRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Details of Proposed and Actual ConstructedStora e Capacities- Retroactive Component (Capacityin '000 tons; coata in R lakh)

Capital Actual/ outlay Capacity probable Capacity (original realizedor capital Variations Center/location planned estimate) coapleted expenditure Physical Financial

North Zone 4TMrsla. 5.00 - 5.00 8.18 - -

Jama 4 Kashmir =asMu Tawl 10.00 - 10.00 23.19 - - Punjab Navasahar 1.67 - 1.67 2.49 - - Amloh 3.34 - 3.34 3.93 - - TalwandiSabo 3.34 - 3.34 5.24 - - Bhogpur 2.50 - 2.50 7.00 - - Faridkot 3.34 - 3.34 4.68 - - Curuhareahai 10.00 - 10.00 23.65 - - Dhuri 5.00 - 5.00 10.30 - - Bholath (phase 1) 5.00 - 5.00 7.66 - - Hoshiarpur 5.00 - 5.00 10.30 - - Balachaur 6.67 - 6.67 11.29 - - Jagraon 8.34 - 8.34 10.28 - - Maloud 10.00 - 10.00 19.08 - - Sangrur 10.00 - 10.00 20.81 - - Barnala (phase 1) 8.34 - 8.34 13.85 - - Jalalabad 5.00 - 5.00 8.94 - - Bhatinda (phase1) 5.00 - 5.00 5.97 - - Shags.r 5.00 - 5.00 9.20 - - Bhatinda (phase 2) 2.50 - 2.50 4.45 - - Bholath (phase 2) 5.00 - 5.00 8.78 - - Sardulgarh 10.00 - 10.00 14.65 - - Zira 6.67 - 6.67 9.38 - - Chabal 5.00 - 5.00 8.76 - - Vallah 10.00 - 10.00 16.71 - Barnala (phase 2) 2.97 - 2.97 4.55 - - Doda 5.00 - 5.00 6.46 - -

Rajasthan NO=n 5.00 - 5.00 10.20 - - Newai 5.00 - 5.00 9.27 - - Nagaur 5.00 - 5.00 10.42 - - Uttar Pradesh Allahabad 10.00 - 10.00 19.20 - - Varanasi 15.84 - 15.84 27.68 - - Attara 6.12 - 6.12 10.20 - - Kanpur 8.34 - 8.34 14.68 - - Chanderi 1.67 - 1.67 4.09 - - Faisabad 13.36 - 13.36 26.65 - - Mathura 10.00 - 10.00 21.00 - - Kosikalan 5.00 - 5.00 9.47 - - South Zone Andhra Fradesh Kanlneaa 5.90 - 5.90 15.41 - - Vishakapatnam (phase 1) 10.00 - 10.00 24.43 - - Visbakapatnau (phase 2) 5.00 - 5.00 13.11 - - Ongole 5.00 - 5.00 0.92 - - Chittor 5.00 - 5.00 11.49 - - Kazipet 13.34 - 13.34 27.76 - - ANNEXP Table 2b - 44- Page 1

INDIA

SECONDFOODCRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Details of Proposed and Actual Constructed Storavge Capacitien - Regular Component - Agreed Sites (Capacity in '000 tons; costs in Rs lakh)

Capital Capacity Actual/ outlay realized or probable Capacity (original completed capital Variations Center/location planned estimate) (12/31/85) expenditure Physical Financial

North Zone Hsrvana anipat 1 25.00 89.71 25.00 85.12 - (4.59) Panipat II 10.00 40.88 10.00 32.61 (8.27) Narwana 1 25.00 120.07 23.00 100.00 (2.00)/a (20.07) Narwana lI 25.00 169.94 25.00 170.00 - 0.06 Kurukahetra 30.00 142.90 30.00 128.30 - (14.60) Siresa 25.00 154.65 23.34 135.40 (1.66)/b (19.25) Kaithal 1 30.00 184.61 30.00 145.11 - (39.50) Kaithal II 20.00 83.42 20.00 68.31 - (15.11) Kalthal III 20.00 130.36 20.00 86.15 - (44.21) Bhattu 5.00 17.36 5.00 14.49 - (2.87) Dabvali 5.00 17.15 5.00 16.03 - (1.12) Walanvall 5.00 17.34 5.00 13.49 - (3.85) Fatehabad 8.34 28.36 5.00 20.72 - (7.64) Ralasthan =-ali 5.00 19.20 5.00 15.25 - (3.95) Barmer 10.00 35.34 10.00 32.50 - (2.84) Alwar 5.00 16.56 5.00 16.80 - 0.24 Sikar 5.00 16.26 5.00 11.41 - (4.84) Kherli 6.68 33.30 6.60 28.00 - (5.30) Amer I 15.00 129.31 15.00 74.15 - (55.16) Punjab --1Ea- 15.00 68.79 15.00 69.78 - 0.99 Chakki Bank 50.00 156.22 50.00 216.61 - 60.39 Amritsar 50.00 18.39 50.00 230.25 - 41.86 Nabha 50.00 275.52 10.00 246.35 (40.00)/a (29.17) Sahneval 50.00 211.12 50.00 222.12 - 11.00 Rajpura 1 25.00 165.00 25.00 111.75 - (53.25) Dhuri 50.00 179.82 50.00 207.48 - 27.66 Kotkapura I 50.00 196.39 50.00 185.08 - (11.31) Kotkapura II 30.00 167.52 30.00 119.06 - (48.46) Patiala 50.00 187.86 30.00 239.92 (20.00)/a 52.06 Sangrur 10.00 44.17 10.00 35.20 - (8.97) Malerkotla 10.00 30.30 10.00 17.26 - (12.54) Tanda Urmur 20.00 209.86 20.00 141.59 - (68.29) Rathur 10.00 31.94 10.00 24.24 - (7.70) Barnala I 8.34 1 36.31 8.34 26.70 - (9.61) Bermal 11 3.34 1 3.34 .- (.1 Tanda Uliur 5.00 15.46 5.00 12.65 - (2.61) Yahalkalan 5.00 16.52 5.00 10.99 - (5.53) Bariwala 5.00 19.42 5.00 13.07 - (6.35) Bbadaur 5.00 17.17 5.00 11.40 - (5.77) Jammu & Kashmir amantuag 5.00 49.45 5.00 51.01 - 1.56 Uttar Pradesh *ttawan 10.00 75.25 10.00 67.00 - (18.25) Saharanpur 45.00 148.41 45.00 173.60 - 25.19 Muraffernagar 50.00 154.23 50.00 191.50 - 37.27 Neoll 50.00 264.20 45.00 254.00 (5.00)/a (9.80) Barabanki 25.00 124.82 25.00 162.31 - 37.49 ANNEX P Table 2c - 45_ YPage1

INDIA

SECONDFOODORAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Details of Proposed and Actual Constructed Storage Capacities - Regular Component - Selected Sites (Capacity in '000 tons; costs in Rs lakh)

Capital Capacity Actual/ outlay realized or probable Capacity (original completed capital Variations Center/location planned estimate) (12/31/86) expenditure Physical Financial

North Zone Haryana Sirsa 2.50 11.21 2.50 6.00 - (5.21) Tohana 1.25 6.33 1.25 3.50 - (2.83) Bhiwani 1.67 7.89 1.67 5.50 - (2.39) Hissar 1.92 7.57 1.92 7.50 - (0.07) Bhiwani Khera 5.00 29.52 5.00 13.50 - (16.02) Panipat III 20.00 1 277.24 20.00 115.06 - (109.95) Panipat IV 10.00 ) 10.00 52.23 1 Gurgaon 8.00 26.42 8.00 26.07 - (0.35) Rohtak 2.60 10.40 2.60 10.20 - (0.20) Ambala 1.28 5.12 1.28 4.21 - (0.91) Palwal 1.67 6.68 1.67 6.69 - 0.01 Tarori 2.95 11.80 2.95 11.46 - (0.34) Pehowa 6.67 26.68 6.67 21.55 - (5.13) Cheeka 5.00 20.00 5.00 20.85 - 0.85 Kaithal 1.25 5.00 1.25 5.01 - 0.01 Safidon 12.50 50.00 12.50 52.19 - 2.19 Faridabad 10.00 91.70/c 10.00 51.04 - 1.04

RaJasthan Jaipur 2.78 20.78 2.78 11.00 - (9.78) Jodhpur 2.78 16.46 2.78 11.70 - 4.76 Sujangarh 3.34 23.25 3.34 14.60 - (8.65) Bikaner 2.50 17.35 2.50 12.57 - (4.76) Swaimadhopur 10.00 207.00/d - 77.55 (10.00)/a (129.45)

Punjab Doda 1.67 7.29 1.67 5.98 - (1.31) Laduka 3.34 13.51 3.34 9.81 - (3.70) Lakhewali 5.00 20.32 5.00 14.25 - (6.07) Bhadaur 1.67 13.C9 1.67 5.73 - (7.36) Malout I 10.00 208.64/d 10.00 99.00 - (109.64) Rajpura II 20.00 98.59 20.00 95.00 - (3.59) Tanda Urmar II 10.00 67.92 10.00 60.db - (7.92) Maloud 6.67 27.36 6.67 21.19 - (6.17) Foranvala 3.34 15.70 - 10.77 (3.34)/a (5.01) Bhagear 3.15 13.09 3.15 10.78 - (2.31) Lobinkhas 1.67 18.58 1.67 6.66 - (12.02) Dudhan (1.25+2.24) 3.49 18.16 1.25 14.04 (2.24)/a (4.12) Abohar 1.67 8.19 1.67 6.97 _ (1.22) Drasuya 11.27 44.21 - 33.51 (11.27)/a (10.70) Faridkot 3.34 16.56 3.34 11.50 - (5.06) Barivala 8.34 35.78 8.34 23.00 - (12.78) Sultanpur Lodhi 3.34 15.51 3.34 12.48 - (3.03) Nahalkalan 1.67 7.55 1.67 5.00 - (2.55) Lodowall 4.46 21.46 4.46 14.00 - (7.46) Chinarthal 1.67 7.49 1.67 5.50 - (1.99) Batala 1.67 8.17 1.67 7.50 - (0.67) Roshlarpur 10.80 31.76 10.80 29.93 - (11.83) Bbosbpur -8.20 26.80 8.20 24.11 - (2.69) Zira 1.67 9.01 1.67 12.46 - 3.45 - 46- Table 3a Page 1

INDIA

SECONDFOODGRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Details of Proposed and Actual Stora8e Construction and Capacities - Retroactive Component (Capacity in '000 tons)

Schedule Actual Date of Date of Capacity Date of comple- Date of comple- Year-vise achievement Center/location planned start tion start tion 1977/78 1978/79 1979/80 1980/81

North Zone stre, 5.00 Jammu6 Kashmir Jammu Tavl 10.00 Punjab Navasahar 1.67 Amloh 3.34 Talvandi Sabo 3.34 Bhogpur 2.50 Faridkot 3.34 Guruharsahai 10.00 Dhuri 5.00 Bholath (phase 1) 5.00 Roahiarpur 5.00 Balachaur 6.67 Jagraon 8.34 4aloud 10.00 Sangrur 10.00 8arnala (site 1) 8.34 Jalalabad 5.00 Ihatinda (site 1) 5.00 Bhagsar MO Ihatinda (site 2) 2.50 Bholath (site 2) 5.00 Sardulgarh 10.00 Zlra 6.67 Chabal 3.00 Vallah 10.00 arnala II 2.97 Doda S.00 Ralasthan I ndl 5.00 Neval 5.00 Nagpur 5.00 Uttar Pradesh Allahabad 10.00 Varanasl 15.84 Attara 6.12 Ranpur 8.34 Chanderl 1.67 Faizabad 13.36 Mathura 10.00 Kosikalan 5.00 South Zone iMdhra Pradesh Kakinada S.90 Vishakapatnam 10.00 Vishakapatnam 5.00 ongole 5.00 Ch*ttor 5.00 Kasipet 13.34 |47 ANEX P Table 3a Page 2

Schedule Actual Date of Date of Capacity Date of comple- Date of comple- Year-vise achievement Center/location planned star. tion start tLon 1977/78 1978179 1979/80 1980/81

South 0one (cont'd) Karnatava - Shimaga 1.67 Kerala Chaiakudy 5.00 Olavakot 6.70 Angadipuram 5.00 Tamilmadu T.V.-5ol 13.34 Madras (bulk) 40.00 East Zone --Taiagla 5.00 Narayan Pur Anant 5.00 Silchar 10.00 Blihar 1 h warishariff 4.59 Gaya 13.34

NEF ReRtion anipur (Iaphal) 5.00 Orissa |Ieshwar (phase 1) 2.50 Jaleshwar (phase 2) 2.50 Rupsa 2.50 [ Dungrapalli 5.00 Jharsuguda 5.00 Dhankanal 2.50 West Zone Madhya Pradesh IaniirHasaud 45.00 Jagdalpur 5.00 Teekamgarh 10.00 Nevari 10.00 Kargi Road 5.00 Balaghat 5.00 Wareaseonl 5.00 Katangi 5.00 Durg 20.00 Sheopurkalan 5.00 Belha 5.00 Rajnandgaon (org.) 5.00 Rajnandgaou 5.00 Rajimnawapara 5.00 8ishrampur 5.00 Kharsia 5.00 Raigarh 2.50 8etul 5.00 Ratlam 3.75 Datia 2.50 Naila 3.00 Seoni 3.00 Rajuandgaoan(additional) 4.00 Maharashtra lortvillt 15.00 lEanuad 32.50

Total 644.64 15.00 526.00 89.00 15.00

Note: All locationsare road-fed. IIIDIA

SECONDtOODCRAtS STORACEPROJECT (CREDIT 747-IN)

PRJoEcT CONPFLETIONBRPORT

Detaill of Proposed and Actual Storage Construction and Capacitles - Regular Component - Agreed Siteo ~~~~~~~~~~(Capacity In '000 ton3s)

Schedule Actual Date of Date ot Capacity Date of coeple- Date of comple- Year-vise achievement COnor/locatlon planned start tion start tlion 1977/78 19i8/19 l979/80 1980/81 1981182 1982183 1983jH4 1984/85 1985i86 198687I/ 1i987188/a Remarks

obthb Zone

P5I t 1 25.00 06180 06/83 OS/80 06/84 ------10.00 IS.00 - - - Ril-fed Panipat 11 10.00 07/80 10/84 01/80 07/84 - - - - - 5.00 5.00 - - Rail-fed btrvan. 1 25 00 09/80 05/85 09/8U 01/86 ------11.67 13.33 - - R5i-fed EaruansI1 25.00 11183 03/8S 11183 10/85 ------16.67 8.33 - - gail-fed Iurushetr 30.00 01/81 07/84 01/83 07/84 - - _ _ _ 2n.00 10.00 - - - Road-fed SInea 25.00 11/82 04/84 11/82 06/85 - - - - - 10.00 8.34 5.00 - 1.66/b Rail-fed eathl 1 30 00 04/83 08/84 04!81 02/85 5.00 25.00 - - - Rail-fed Malthal it 20.00 12/83 11/84 12/813 03/85 ------20.00 - - - Rell-fed sitbal111 20.00 11/83 01185 11/83 0/85 ------10.00 20.00 - - Rail-fed ttballu 5.00 12/81 08/82 12/81 03/83 - - - - - 5.00 - - - - Road-fed Dabe al 5.00 01182 09/82 03182 031/8 - - - - - 5.00 - - - - - Road:fad Ealanvali . 5.00 03182 09/82 03/82 01183 - - - - - 5.00 - - - - Road-fed tatehbbd 8.34 02/82 08/82 02182 03/83 - - - - - 8.34 - - - - - Road-ted

R hOSth8a V&ll 5.00 03181 12183 t01/81 02/84 ------5.00 - - - - Road-fed llrmar 10.00 03/83 12/83 01/83 05/84 ------5.00 5 00 - - Road-fed 5tlar 5.00 03/83 12/83 01/83 02/84 ------5.00 - - - - Road-fed Ehe iI 6 68 03/83 12283 013183 05/84 ------3.34 3.34 - _ - Road-ted AJ_ar I 25.00 i/83 02/85 I1/83 07/85 ------10.00 5.00 - - Road-fed Alger 5.00 03/83 12/83 03/83 12/83 - _ _ _ _ - 5.00 _ _ _ _ Road-fed

15.00 11/83 11/84 11/83 03/84 ------25.00 - - _ - Road-fed 1o*akiRank 50.00 06/80 02/84 n0680 03/84 - - - 25..00 2M.OO S.Oo 5.00 - - _ _ Rail-fed Anritr 50.00 04/83 09/84 04/83 08/84 ------45.00 5.00 - - - Rail-tod mabha 50.00 08083 09/85 08/83 03/88 ------20.00 25.00 S500 Rail-ted Sahro l 50 00 04/80 09/81 04/80 06/82 - - - 5.0 35.00 21.00 - - -- Rail-fed Rejpura 1 25.00 1IJ80 09/82 04/80 03/82 - 20.00 5.00 - - - - - Road-fed Dhuri 50.00 04/80 l0/82 04/80 03/82 - - - - 30.00 10.00 - - - - Rail-fed Iotbapurn 1 50.00 01/80 0O682 02/80 06/82 - - - 20.00 30.00 ------Roll-fed Paothpura 11 30.00 02/81 Ob/84 02/83 09184 - _ _ _ _ _ 25.00 5.00 - - - Rail-fed PaIlSia 50.00 09/79 03/81 09/79 06186 - - - 20.00n 0.00 - 100.00000- Ral-ted 5angrur 20.00 02/83 I0/43 02/81 03/84 ------20.00 - - - - Road-fed ale'rkotla 10.00 03180 09/80 03/8') 02/85 - - - - - 2n n - - - - Road-fed tenda Urcur 20.00 0S/83 09/84 05/83 09/84 ------20.00 - - _ RaId-fed llnthur 10.00 09/81 01/82 09/81 03/83 - - - - - 20 -n - - Road-ted Iernala 2 8 34 01181 08/81 02/81 03/83 - - - _ - 8.51 - - - - Road-ted BTrn*l I1 3.34 09/81 01/82 09/81 03/83 - - - _ - 1 34 - - - _ - Rad-fed Tands urmur 5.0O 03/80 09/8 1 01/80 03/83 - - - - - S.' _- _ _ - Road-fed Itnhla IOn 5.00 03/81 09/81 013/21 n3/3 - - 5 n - - _ - Rtoad-fed Bariwla 5.00 04/81 09/81 n4/81 07/83 - - - - - S oo - - _ _ _ Road-fed IYhadaur 5.00 09/81 01182 09/81 03/81 - - - - - S 120 - - - - - Road-ted irmni & Kashmir Rd-e Anantnag 5.no 10/82 Wu)84 Willi 11/14 ------5 )o - - _ _

Ulttr Pradesht 310 10/83 08/44 11"/1 19/84 - - - - - 10 _- _ Sabranpur 45 oo2 08/80 (02/H2 (h0.* 02/82 - - - 12.0 .( 12 n _- - - Notternagat 50.300 03/79 n0/( 1 (12b12 - - - 4n0.on .0n Neoll 50.00 11/84 09/85 Il/S4 03/87 ------s.on 10.0 0 00 5.0- erobankl 25.00 01/81 05/82 O1/HI (19/81 - - - - - 2I.S00 1(1 - Schedute Actual Date of Date of CapaIcit Deto Of casple- Date of couple- _____ear______w______s______hi______Cantor/locatlo, pleaned start tcio start tion IS77/78 1976/79 1979160 1960(81 1981182 1962/83 1983/84 1984/85 1985/86 198VUL& 1987/88/a aeMarak

South Zone _Ifdta vri'ideab 50.00 02/79 32/80 02/79 09/82 - - - 20.00 20.00 10.00 - - - - - 1araal 25.00 01.,79 09/81 01/79 09/82 - - - 25.00 ------Cberlapall 11 30.00 10/82 10/84 10/82 08/84 - 00 25.00 5.00 Ibncbertal 10.50 09/83 07/84 09/83 07/84 ------10.50 - -- aleorade 30.00 07/83 02/85 07/83 03/87 - 25.00 - 5.00 Cadivada 30.00 05/83 113/86 05(83 03/88 ------30.00 Cinikudlt 30.00 09/83 03/85 09/83 03/87 - 5.00 15.00 - Ozacur 25.00 08/78 03/80 08/78 03/80 - - - 25.00 VljayiSda 50.00 04/79 03/81 04/79 09/83 - - - - - 50.00 - - - - - Iadaloadma 5!3Imove t 50.00 0 06/8 02/86 - 50.00 - - Colabatore 11 40.00 09/79 09f83 09/79 06/82 - 40.00 Cojabatore Itt 20.00 11/83 02785 113/83 07/85 - - - - - 10.00 10.00 -- Satpgdl 1 25.00 11/81 11/82 11/81 04/83 - - - - - 20.00 5.00 - - - - Satpadi 11 5.00 10/82 04/83 10/82 12/83 ------5.00 - - - - Satpadl III 30.00 04/83 10/84 04/83 01/86 - - 5.00 25.00 - - Kerala uktta 1 13.34 12/80 12/81 12/80 09/82 - - - - - 13.34 - Olavkuttam1I 12.00 10/83 01/85 10/83 09184 - - -°- -° 12.00 - OloavaotI 20.00 12/79 04/81 12/79 07/82 - - - 10.00 10.00 - ---- Olavakot It 7.50 10/83 08/84 10/83 06/85 ------5.00 2.50 - - Thtkkodt 1 20.00 09/80 01/82 09/80 06/83 - - - - - 5.00 15.00 - - - - lbikkodi 11 10.00 07/83 07/82 07/81 I1/83 - - 10.00 - T*bkkodi 1I 30.00 118/3 10/84 11183 12/85 - - - ' 0.00 gArouaepelli 20.00 01/82 04/84 01/82 01/84 - - - - 5.00 15.00 1 - - - Karnataka qunrtezieldI 50.00 07/83 07/85 07/83 01/86 - - 5.00 25.00 llnbitf lpud tl 35.00 081/3 04/85 08/83 03/88 - - 10.00 - 10.00 15.00 east Zone gaal 50.00 04/81 04/80 04/81 07/84 - - - - I 3. 30.00 3 - * _ Aaro It 30.00 08/83 02/85 08/83 W3/88 ------5 00 25.00 - - Ortega W-Flampur 25.00 10/78 03/81 W0/7 0)/SI - - 25.00 - - -R ail-fed boarauguda 25.00 08/79 021/8 08/79 03/82 35.00 10.00 S - R.oRond-fed Bihar gldhau 1 3125.00 08/ 8511212 08/13 06/83 - _ - - 25.00 - - Rl-tedRa.l- totay1.pur 2ant25.00 11/83 05/85 08/86 - 290/83 33845. 2 30.00 RaIl-d d vEastZone

-16mrasiu-425.00 12/78 04/80 12/70 12/81 - - 25.00 ------Ri-fed Itaral 50.00 03/84 03/88 03/84 03/88 - S .00 45.00 R8aall-fed Ehiadva 50. 0 08/78 03/80 08/78 03/83 - - 0.00 ------Rail-fed Rajnaad8an 50.00 06/79 12/80 06/79 03/82 - - 0.00 20.00 ------Ri-e

Ogg-au'r- 25.00 04/79 04/80 04/79 03/84 - - - 3.00 - 0.00 -- - Rail-fed llardhaIt 50.00 08/83 08/85 08/83 03/86 ------25.00 25.00 - - Ratl-fed lanwel 1 50.00 03/83 03/83 03/81 03/87 - - - 10.00 10.00 - .00 20.00 5.00 - Rail-fed Vassal II 45.00 I1/83 10/85 11/81 01i88 ------10.00 35.00 iRail-fed Condis 20.00 06/83 12/84 06/83 02/85 - - - - - 20.00 - - - Road-fed Hlvaj 50.00 04/80 03/84 04/80 03/84 - - - 30.00 30.00 5.00 5.00 - -- Rail-fed

auauldcntrdotegii8Wldham I 35.00 03/83 06/84 03/83 06/84 - - 0.00 5.00 Rail-fied Gaadbtdlwa XX 35.00 11/83 05/85 33/83 02/86 - - - - - 35.00 Bil-edMt- Godbra 10.00 10/83 08/84 10/83 08i84 ------10.00 - - - p1-ed total 2,270.04 43 290.MM 288.36 33o3 397.51 279.7 300.00 342.50

aprobabeprjctoe I3aodcooatrai5tg. INDIA

SECONDFOODCRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECTCOMPLETION REPORT

Details of Proposed and Actual Storage Cnr,conAnd Capacities - Regular Component-Selec.ted Sites (Cs7actty in '000 tons)

Schedule Actual Date of Date of Capacity Date of comple- Date of comple- Year-wise achievement Center/loc-tlon planned start tion start tion 1977/78 1978179 1979/80 198018/ 1981/82 t982/81 1983/84 1984/85 1985/86 19861871a 1987/Sl/a Remarks

North Zone P.aryaoa Sirsa 2.50 05/84 09/84 05/84 08/84 - Vohana 2.50 - _ Rod-fed 1.25 05/84 09/84 05/84 08/84 - Bhivani 1.25 - Road-fed 1.67 05784 11'84 OS/84 1084 - - Ilissar - - _ _ 1.67 - _- Road-fed 1.92 05184 11/84 OS/84 10/84 - - _ _ 8bhivnt Khera 1.92 - - Road-fed 5.00 07/84 01/85 07/84 Olt85 ------5.01 - - Road-fed Pantpat III 20.00 10784 06/85 10/84 06/85 - - - £t .00 10.00° Road-fed Panipat IV 10.00 12784 .16/85 12/84 06/85 - - Curgaon - - - - - 5.00 5.00 - - Ro0d-ted 8.00 - - - 03/85 - - - - Rohtnk - - - 8.00 - - - Road-fed 2.60 10/84 02/85 10/84 06/85 - 2.60 - _ Road-fed Ambala 1.28 10/84 02/85 t0/84 06/85 PaIalW - 1.28 - - Road-fed 1.67 10/84 02/85 10/84 03185 - - - Taror1 - - - - 1.67 - _ _ Road-fed 2.95 10/84 02t85 10/84 04/85 - - Pehove - - - - - 1.67 1.28 - _ Road-fed 6.67 10/84 02/85 10/84 04/SS - - - Cheeka - - - - 5.10 1.67 - - Road-fed 5.00 10/84 02/85 10/84 06/85 - - - KaItha l - - - - 1.34 1.66 - - Road-fed 1.25 10/84 02/85 10/84 02/85 - 1.25 - _ _ Road-fed Sa idon 12.50 l0/84 02/85 10/84 06/85 - -1000 2.50 Partdabad 10.00 10/84 02/85 10/84 - Road-fed 06/85 - Road-fed J&rP'u-r 2.78 09784 05/85 09/84 05/85 - - - Jodhpur - - - _ - 2.78 - - Road-fed 2.78 12/84 02/85 12/84 02/85 ------2.78 - _ _ Road-fed Sujangarh 1.34 12/84 02/85 12/84 02/85 ------3 34 itkaner 2.50 09/84 06/85 09/84 iRoad-fedt 04/85 ------Swalsdhopur 10.00 03/84 - 2.50 - - R"d-fed 12/85 03/84 03/86 - -0.00 - - Road-fed Punl b 1.67 02/84 06/84 02/84 11/84 - - _ _ _ _ - 1.67 - Ladulra 3.34 - Road-fedR 03/84 08'84 03/84 11/84 - - - - LakhewIL1 - - - 3 34 - - Road-fed 5.00 02/84 09/84 02/84 12/84 - - - - Uh4dour - - - 5.00 - - - Road-fed 1.67 02/84 08,84 02/84 08/84 - - - ialout I - - - - 1.67 - - - Road-fed 10.00 03/84 06/85 03/84 06/85 ------5.00 5.00 - Rajpura Is 20.00 02/84 06/85 02/84 - Road-fed 06/85 ------15.00 - Tanda Urmr It 10.00 02/84 11/84 02/84 - - Rod-fed 03/85 ------10.00 - haloud 6.67 02/84 03/85 r2/84 - Road-fed 03/85 ------6.67 Roran ala 3.34 03/84 - - Road-fed 08/84 13/84 02/86 ------Niagi3r 1.15 - - 3.34 - - Road-fed 05/84 10/84 03/85 - - - - - Lohinkhas 1.67 - - 1.15 - - - Road-7fed - - - 12/84 - - - - - Dudbam(1.25+2.24) - - 1.67 - - Rodd-fedR 3.49 09/84 11/d4 .8/84 01/85 - - _ _ _ _ _ 1.25 - 2.24 - R6ad-fed 02/85 06/85 0/8l5 09/85 Abohar 1.67 05/84 09t84 05/84 03/85 ------1.67 Dhasuys 11.27 02/82 06/R2 - - - Road-fed 02A82 02/86 ------FaTidkot 3.34 - - £1.27 - _ Road-fed 08/84 01!85 0)8/84 05/85 - - - Barltala - - I3.34 - Road-fed 8.34 11/84 06/85 11/84 07/85 ------8.34 - Sultanpur Lodhi 3.34 10/84 06/85 10/84 07/85 _ Road-fed ------3.34 ahbalkslan 1.67 07/84 - - Road-fed 01/85 (17/85 01/85 - - - - - Lodowall 4.46 - - 1.67 - - - Road-fed 12/84 07/75 12/84 07/85 - - - - - Cilnarthal - - - 4.46 - - Road-ted 1.67 07/84 i1/85 07/84 02/85 - - Batcala - - - - 1.67 - - - Road-fed 1.67 08/84 O5/85 08/84 04/85 -- - 12.67 - - OAd-f.J hoshiaepur 10.80 - - - 06/85 ------5.00 5.50 - - Uiogpur 8.20 - - - 06185 Road-feJ ------8.20 - - Road-fed Zira 1.67 02/85 06/85 02/85 06/85 - - - 1.67 - Road-fed Schedule e Actual Date of Date of Capect:y Date of cople- Date of comple- Year-vise schlvemat Center/location plaond stert tion start tlon 1977/78 1978/79 1979/80 1980/81 1981/82 1982/83 19"3184 1984/85 1985/86 1980687k 19S71/8js RleUa

poth Zone (cont'd) Puniab (cont'd) Nihala haAlpwo 1.25 0A/6S 07/8S 03/85 06/85 ------1.25 - Rood-fed Rajpurs 3.34 02/85 06/85 021WAS 05/6 ------3-34 - 6d-fed Channaur 2.24 02/85 06/85 02185 05/8S ------2.24 lRood-fed Talwandi Nat 2.24 02/85 06/8S5 02/85 06/86 - - - 2.24 - - d-fed KlilaraIpUr 2.50 03/85 07/85 03J85 06/85 ------2.50 - Road-fed Gill load 1.07 03/SS 07/85 03Wa5 06/85 - -1ld-fed 1d banaur 3.34 02/85 06/85 02/85 06/85 ------3.34 - - lord-ted Uhucbu 4.46 03/85 07/85 03/85 05/85 ------*.46 _ _ Road-fed

Jamu lKashmlr Juom 'Swi0 6.68 01/84 06/85 01/84 11/84 - - - - _ _ - 6.68 - - Road-fed Uttar Pradesh laibareilly 10.00 04/84 0S/85 04/84 06/85 - - - - - 10.00 Rall-fed Vyae Nagar 5.00 07/84 10/85 07/84 0/85 ------5 00 -d-fed Saharanpur 10.00 - - 0685 7.50 2.50 _ RRail-fed Oedri 11.20 - _ - 06/85 ------10.00 1.20 - - load-fed bastt 10.00 - 06/85 -500 500 d-ed Gor.khpur 10.00 ------_ _ _ - - 10.00 - - oad-fed Shehb]abnpur 7.20 - - - 06/85 - - 7.20 - load-fedl Jeaporo 8.20 - 06/85 ------8.20 - oad-fed

Celhl 25.00 05/84 09/85 05184 06185 ------25.00 - R ail-fed South 2oe Adra desh Sanasilemar 3.25 08/83 04/84 08/83 09/84 ------1.25 - _ load-fedR L.C. Depot 1.67 02/83 08183 02/83 09184 ------1.61 - _ load-fed n heona 2.50 02/83 08/83 02/83 09/84 - - - - - 2.50M - _ - Road-fed Eleru 0.64 05/83 12/83 05/83 07/84 - - - _ - _ _ 0.U6 - - load-fed Ntdadavole 1.2S 03/84 09/84 03/84 07/84 - - - _ _ _ 1.25 - - - Road-fed Amadalavalaa 2.31 10/83 05/84 10/83 07/844 - - - _ _ - 2.31 - load-fed onsole 5.00e 0/85 I2/8S 02/85 06/85W ------5.00 - - Road-fed T4d4palltgudm 10.00 - 03/86 - 03/85 ------10.00 - - - stlfed ViJaywada 20.00 - 03/86 - 0387 -- _0.00 - - ld-fed Palakolu O.6 06/83 12/83 06/83 03/85 ------0.64 - - - oad-ed Karnataka Hubil 1.67 08/82 04/83 08/82 08/S -- 1.67 - - Road-fed K.b. Puran 1.28 02/84 12/84 02/84 06/85 ------3.28 - - Road-fed haddur 1.22 05/84 03/85 05/46 12/85 ------1.22 - Road-ted ShlaoSa 3.28 03/84 01/8S 03/84 03/85 - - - _ _ _ _ 1.28 _ - - bad-fed hadravtl 0.64 0/84 0/85 05/84 06/85 _ _ - 0.64 - - Road-fed East 20n vast BaitaRl *3hareipur 5.00 -. 06/8 - 00 - - Road-fed

_ Orissa ,Mxpur 15.00 - - - 06.85 ------35.00 - - Road-fed Ihrda band 1.28 06/82 - 06/82 05/84 - - _ _ _ _ _ 1.28 - - - lod-fed Bihar IEabad 3.34 01/82 04/82 bl82 04/84 ------3.34 - - Road-fed *EU Schedule Aetual Date of Date of Capae1ty Data Of couple- Date of eople- Year-vlse achieveaot Center/location plaoed start tlon start Ulon 1977178 1978/79 1979/80 1980/81 1951182 1982/83 1983/84 1984/85 1985186 1986/87ta 1987i881a Remarks

Vast zone *1HadhYaPtadosh UJialo 5.00 07/84 - 07/84 06/85 ------5.00 - - Road-ted xhandwa 40.00 - - - 03/85 ------40.00 - - - Rail-fed bbopal 10.00 - - - 06/85 ------.00 5.00 - - Read-fed 8urhenpur 7.70 - - - 03/85 ------7.70 - - - Roa4-fed shat6para 4.40 - - - 03/85 ------4.40 - - - Road-fed KaratRoad 5.00 11/84 03/85 11/84 06/85 ------S.00 - - Road-fed Diabrarpur 5.00 11i84 '3/85 11/84 06/85 ------5.00 - - Road-fed Dur$ 3.34 11/84 03/85 11/84 06/85 - 34 Road-fel Ralpur 1.25 11/84 03:85 11/84 06t85 1.25 Road-fed RaJnaodgaon 1.67 11/84 03/85 11/84 06/85 ------1.67 - - Road-fed dllaspur 5.00 11184 3tss 11/84 10/85 ------5.00 - - Road-fed Blha 3.34 11/84 031/5 11/84 06/85 ------3.34 - - Road-ted Kataogt 3.34 11/84 03WasS 1/84 06185 ------3.34 - Road-fed welaghat 1.67 11184 03/85 11/84 06/85 ------1.67 - - Road-ted 8etul 5.00 11/84 03/85 11/84 06/85 ------S.00 - . - Road-fed aharastra Iraj 30.00 - - - 03/85 ------30.00 - - - Rail-fed gu1arat !Ishaao 1.12 09/84 02285 09/84 03/85 ------1.12 - - - Road-fed barode 2.24 11/d4 05/85 11/84 05/85 ------2.24 - - Road-fed palanpur 1.96 11/84 04/85 11/84 04/85 ------1.96 - _ R"d-fed Codhra 2.24 09/84 O0f85 09/84 03/85 ------1.40 - - t.84/b Road-fad Anaad 12.50 - - - 06/85 - - * - - - - 10.00 2.50 - - Road-fed Jamnagar 7.70 - - - 06/85 ------7.70 - - - Road-fed Bhavnagar 7.00 - - - 06/85 ------7.00 - - RoAd-fed

Total 610.52 - - - 312.43 275.02 22.24 n.84

/a Probable projections.

/b Land constrainta.

ItI) ANNEXP -53 Table 4a

INDIA

SECONDFOODGRAIN STORACE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Center-wise Details of Rallway SidinRs (Including Land Costs) (Rs lakh)

Total Probable Date of AA & ES Center/state/ capacity cost of completion/antici- zone/agency ('000 tons) M & ES completion pated completion

North Zdhe Haryana FCI P nipat I 25.00 133.77 154.42 05/80, 09/83 PanipatII 10.00 Narwana I 25.00 } 85.17 103.42 04/81, 12/85 Narwana II 25.00 }

CPWD Sirsa 25.00 43.68 48.92 06/84, 1986/87 Kalthal I & II 50.00 41.86 72.06 06/80, 06/85 Kaithal III 20.00 1

PunJab FCI Chakkl Sank 50.00 42.09 64.09 03/80, 07/86 Amritsar 50.00 115.34 137.34 06/84, 1986/87 Nabha 50.00 100.40 122.40 06/84, 1986/87

CPWD Sahnewal 50.00 133.88 148.88 03/80, 12/83 Dhuri 50.00 40.46 62.46 03/80, 1987/88 Kotkapura I 50.00 60.00 79.80 09/82, 1986/87 Kotkapura II 30.00 1 Patiala 50.00 147.40 169.40 03/80, 01/86

Uttar Pradesh

Saharanpur 45.00 118.15 120.40 03/81, 1986/87 Muzaffernagar 50.00 83.53 98.03 03/80, 11/84 Neoll 50.00 106.77 128.77 06/84, 1986/87

CPWD Barabanki 25.00 29.54 40.54 03/82, 1986/87

Selected Sites Punjab CPWD Malout 1 20.00 41.30 45.90 07/84, 1986/87

Delhi FCI Chevra 25.00 140.00 154.00 06/84, 1986/87 54 - Table 4b

INDIA

SECONDFOODGRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT.COMPLETION REPORT

Center-wise Details of Railway Sidings (Only Land Cost) (Re lakh)

Center/state/ Total capaclty zone/agency ('000 tons) Land cost

North Zone Raryana * CI Kurukshetra 30.00 3.60 PunJab FCI Moga l5.00 6.60 CPWD Rajpura I 25.00 3.00 Sangrur 10.00 4.40 Naleekotla 10.00 4.40 Tanda Urmer 20.00 8.80 Tanda UrserSI 10.00 0.80 ialoud 6.67 4.40 Jammu& Kashmir Anantnag 5.00 2.40

Ralasthan FCI Ajaer 15.00 6.60 CPID Swaimadhopur 10.00 4.40 Uttar Pradesh FCI Eeawah 10.00 4.40 CPWD Raibarelli 10.00 2.10 Vyas Nagar 5.00 2.20 West Zone Maharastra FCI Condia 20.00 0.40 Guiarat Godhra 10.00 0.60 Subtotal 59.10

GRANDTOTAL 6.130.43

Notes Land cost Rs 865.07 (lakh) and railway sidings Ra 5,265.36 (lakhs). 55 Table 5

INDIA

SECONDFOODGRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Year-wise Project ImplementationDetails

Physical (million tons) Financial (Rs million) Estimated Estimated Actual progress Actual outlay program expenditures

RetroactiveWorks

1977/78 } 0.015 n.a. 53.5 1978/79 0.645 0.526 n.a. 147.0 1979/80 } 0.089 n.a. 185.0 1980/81 } 0.015 n.a. 385.5/a

Regular Construction (Both Agreed and SelectedSites)

1980/81 0.500 0.435 202.5 205.8 1981/82 0.500 0.290 194.0 132.9 1982/83 0.400 0.288 205.0 204.4 1983/84 0.400 0.338 210.0 229.8 1984/85 0.600 0.710 440.0 502.4 1985/86 0.563 0.554 250.0 300.6 1986/87/b 0.102 0.102 200.0 200.0 1987/887b 0.140 0.140 88.6 88.6

Total 2,250.0

n.a. = Not available.

/a Rs 147.0 million representsexpenditures on retroactiveworks and the balance for new centers.

/b -Probableprojections. ANNEX P - 56- Table 6

INDIA

SECONDFOODGRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Storage CapacitiesBuilt Under the Retroactive Financing Component - Abstract

Physical/capacities Capital expenditures constructed(mln tons) incurred (Rs million)

1977/78 .015

1978/79 .526

1979/80 .089

1980/81 .015

Total .645 147.0 ANNEX P 57 Table 7

INDIA

SECONDFOODGRAIN STORAGE PROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Statement ShowiLg the Financial Sources

Expenditures Amount claimed Amount disbursed incurred for reimbursement by World Bank (Rs million) (Rs million) (US$ million)

1977/78 53.5 -

1978/79 147.0 - 4.272 1979/80 185.0 128.4 9.154

1980/81 205.8 76.2 9.578

1981/82 132.9 67.6 9.367

1982/83 204.4 110.3 11.018 1983/84 229.8 92.5 8.324

1984/85 502.4 325.9 26.089

1985/86/a 300.6 307.2 27.709

Total 1,961.4 1,108.1 104.511

Probable During 1986/87 20.00 1987/88 8.86

GRANDTOTAL 2,250.0

- Figures up to December 31, 1985. ANNEX P -58 Table 8

INDIA

SECOND FOODGRAIN STORAGEPROJECT (CREDIT 747-IN)

PROJECT COMPLETIONREPORT

Number of Rail-fed Centers Where Siding Works are not yet Completed (as of December 31, 1985)

Total number of centers originally considered/ selected for railway siding provision 56

Number of centers added during the execution stage 12

Number of centers dropped form the selected list 24

Number of centers where railway siding works are fully completed 11 (15 sidings)

Number of centers where railway sidings are still in progress 33 (43 sidings)