Document of The World Bank
FOR OFFICIAL USE ONLY
Public Disclosure Authorized Report No. 11751-PAK
STAFF APPRAISAL REPORT
Public Disclosure Authorized PAKISTAN
NORTHERNRESOURCE MANAGEMENTPROJECT
MAY 24, 1993 Public Disclosure Authorized
South Asia Region Country Department III Agriculture Operations Division Public Disclosure Authorized
This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. Currency Eauivalents
Rupee 1.00 = US$0.04 US$ 1.00 = Rs. 26.27
Weiqhts and Measures
Metric System
Government Fiscal Year July 1 - June 30
PRINCIPAL ABBREVIATIONS AND ACRONYMS USED
AERU - Agricultural Economics Research Unit AI - Artificial Insemination AJK - Azad Jammu and Kashmir AKRSP - Agha Khan Rural Support Program AO - Agricultural Officer ATI - Agricultural Training Institute CCF - Chief Conservator of Forests DFO - Divisional Forest Officer DOA - Department of Agriculture DOAH - Department of Animal Health DOF - Department of Forestry ECNEC - Executive Committee of the National Economic Council FA - Field Assistant FWO - Frontier Works Organization GOAJK - Government of Azad Jammu and Kashmir GOP - Government of Pakistan HFTDP - Hill Farming Technical Development Project IHFDP - Integrated Hill Farming Development Project LDC - Livestock Development Center LG&RD - Local Government and Rural Development Department NARC - National Agricultural Research Center NCS - National Conservation Strategy PARC - Pakistan Agricultural Research Council PC-l - Planning Commission Form No. 1 PCR - Project Completion Report P&DD - Planning and Development Department PRU - Privatization and Reorganization Unit PWD - Public Works Department SA - Stock Assistant SCARP - Salinity Control and Reclamation Project SFW - Social Forestry Wing SMS - Subject Matter Specialist SMU - Social Mobilization Unit TARU - Training and Advisory Research Unit TP - Technical Package VDC - Village Development Committee PAKISTAN FOR OMCIAL USE ONLY
Northern Resource Management Projlect
Table of Contents
sUe No. CREDITAND PROJECT SUMMARY ...... iii-v
I. PROJECT AND SECTOR BACKGROUND...... 1 Project Genesis ...... 1 Project Background ...... 1
H. ISSUES, OBJECTIVES AND STRATEGIES ...... 2 Natural Resource Management Issues ...... 2 Institutional Weaknesses ...... 3 Inappropriate Regulations and Legislation ...... 6 Little Public Awareness ...... 6 InsuMcient Community Participation ...... 6 Policy Issues ...... 7 Strategy for Hill Areas in AJK ...... 8 National Conservation Strategy and Its Implications for AJK ...... 8 World Bank Group and Other Donors' Strategy ...... 8 Bank Group Lending ...... 9 Related Projects and Lessons Learned ...... 9 Rationale for Bank Involvement ...... 10
M. THE PROJECT .11 Project Objectives ...... 11 Summary Description ...... 11 Detailed Features ...... 13 A. PolicyActions ...... 13 B. Institutional Strengthening ...... 15 (a) Department of Agriculture ...... 15 (b) Department of Animal Husbandry ...... 17 (c) Department of Forestry ...... 18 C. Other Institutional Strengthening ...... 18 D. Basic Technical Services ...... 19 E. Pilot Areas ...... 19 F. Improvementto Rural Roads ...... 20 Project Costs and FinancingPlan .20 A. Project Cost Summary.20 B. Financing.22 Procurement.23 Disbursements. 25 RetroactiveFinaning .26 Accountsand Audit...... 26 This report is based on the findingsof an appraisalmission which visited Pakistan in March 1993. Mission membersincluded Messrs. GuyMotha (TaskManager), Abdul Qaiyum Shelkh and RashedUl Qayyum (IDA). Ms. HaeyoungLee (SA3AG)undertook the economicand financialanalyses. Messrs. Colin Rees (ASTEN),Jock Anderson(AGRAP), and N. Sharma(AGRTN) are the peer reviewers.Mr. Paul Isenman is the CountryDirector, and Mr. RidwanAli is the AgriculturalOperations Division Chief of Country Department3, SouthAsia Region.
Thisdocument has a restricteddistribution and maybe used by recipientsonly in the performance of theirofficial duties. Its contentsmay not otherwisebe disclosedwithout World Bank authorization. - ii -
IV. ORGANIZATIONANDMANAGEMENT ...... 26 Implementation ...... 26 Institutional Strengthening and Policy Reform ...... 27 Pilot Areas ...... 30 Monitoring and Evaluation ...... 30
V. BENEFITS,JUSTIFCATION AND RISKS ...... 32 Benefits ...... 32 Environmental Effects ...... 33 Risks ...... 34
VI. AGREEMENTSAND RECOMMENDATIONS...... 35
ANNEXES
ANNEXI Resource Management Treatments and Techniques .37
ANNEXII Communy Participatory Approach .41
ANNEXI Table: Rural Road Improvement Program. 45
ANNEXIV Table: Estimated Schedule of Disbursements .46
ANNEXV Table: IDA Project Supervision Plan .47
ANNEXVI Procurement Implementation Schedule.48
ANNEXVII Economic Analysis.49
ANNEXVm Allocation and Disbursement of the Proposed IDA Credit .55
ANNEXTable 1 ProJect Components by Year .56
ANNEXTable 2 Project Cost Summary .57
CHARTI Existing Organization of the Department of Agriculture .58
CHART II Existing Organization of the Department of Animal Husbandry .59
CHART II Existing Organization of the Forestry Department Azad Jammu & Kashmir .... 60
CHARTVI Proposed Organization of the Department of Agriculture .61
CHART V Proposed Organization of the Department of Animal Husbandry .62
CHARTVI Proposed Organization of the Forestry Department Azad Jammu & Kashmir ... 63
CHART VII Proposed Organization of Planning and DevelopmentDepartment .64
MAP IBRD 24703 - iii -
PAKISTAN
NORTHERNRESOURCE MANAGEMENTPROJECT
CREDIT AND PROJECT SUMMARY
Borrower: Islamic Republic of Pakistan
Beneficiaries: Azad Jammu and Kashmir
Amount: Credit: SDR 20.4 million (US$ 28.8 million) equivalent
Terms: Credit: Standard, with 35 years maturity
Project Description: The five year project is designed to provide the basis for the sustainable and economically efficient use of land resources in Azad Jammu and Kashmir (AJK), which ranks with the country's poorest and most environmentally fragile areas. The project has three broad fronts: (i) improving the policy framework within AJK for the use of land resources (including the role of the private and public sectors); (ii) restructuring and strengthening the main institutions that help manage and protect the land resources in AJK; and (iii) testing, on a pilot basis, programs whereby communities take full management and financial responsibility for planning and implementation of activities covering land resources in the communities. Under (i) above, input production and distribution programs would be phased out through a program for transfer of these activities to the private sector. Associated with the transfer is a program for the phased elimination of subsidies on inputs. The specific activities for transfer and subsidy removal are production of vegetable seed, seed potato, fruit tree and forest tree seedling production; field crop seed (wheat, maize, and oats), and fertilizer distribution and poultry vaccination. Changes would also be made to the current practices and policies that apply to community approaches to the management of communal lands. Under (ii), the project would restructure and streamline the Department of Agriculture (DOA), the Department of Animal Husbandry (DOAH) and the Department of Forestry (DOF). The restructuring is at the request of AJK, but refinements are made to ensure that the agencies cater to the redefined objectives. Production and input distribution would be handed over to the private sector and these agencies would concentrate on the core activities of technology dissemination and working with communities. The effect of these measures is an overall net reduction in public sector staff. The Planning and Economic Services would be - iv -
moderately expanded to enable analysis, planning, monitoring and evaluation. A Social Forestry Wing would be added to DOF to assist in community participatory approaches to management of communal lands, extension training, soil conservation and range management. AJK's Planning and Development Department would be supported by staff for environmental screening and land use planning. It would also be strengthened by a Privatization and Reorganization Unit to be established temporarily and to be responsible for phasing out the production and input distribution activities, input subsidies and re-deployment of staff. Under (iii), pilot schemes would be introduced in five areas where farmers would take on responsibility for the planning, execution, and financial management of the resource management programs. A Social Mobilization Unit would be established to assist communities, including women in forming groups. A rural road improvement program would support the economic viability of the pilot schemes.
Benefits: The project would benefit farmers in AJK directly through the introduction of environmentally friendly and profitable technical practices, which would increase incomes. In the area of human resources, training activities and public awareness programs will provide a better knowledge of environmental degradation and remedial measures for conservation of resources. The project would contribute to the empowerment of rural communities, creation of local management capabilities, and acknowledgement and enhancement of the role of women in the management of natural resources.
Risks: A possible risk is that the local communities may be slow in forming community participatory groups. However, it is expected that experience already gained by the community in recent participatory approaches, active involvement of the Social Mobilization Unit, consultancy staff provided under the project, the technical input from the government support services, and mass education and training would contribute to a high level of farmer interest. Another risk is that the returns from the project may be inadequate. However, experience to date with development and dissemination of technical packages has on balance been positive. The returns to rural roads have been quite good. Using pilot projects with promising, but not yet widely tested, approaches before widespread dissemination will mitigate risks. The risk of financial sustainability of public sector resource management institutions is being addressed by a net overall reduction in size of public sector agencies and elimination of subsidies. A third risk is that the phased program of transfer of activities and subsidy elimination may be delayed. However, adequate safeguards have been built into the project such as the Privatization and Reorganization Unit, annual evaluations and technical assistance to ensure that targets are met. - v -
Estimated Costs and FinancinQ Plan
US$ million
Estimated Costs Local Foreign Total
A. Institutional Restructuring/Support: Agricultural Services 1.4 2.2 3.6 Extension and Adaptive Research 0.4 0.4 0.8 Community Forestry & Resource Management 5.4 0.6 6.0 Community Awareness & Education 0.1 0.1 0.2 Policy Planning & Evaluation 2.0 0.7 2.7 Sub-Total 9.3 4.0 13.3 B. Basic Technical Services 5.4 1.6 7.0 C. Road Improvement 6.9 1.5 8.4 D. Pilot Schemes 1.0 0.9 1.9 Total Base Costs 22.6 8.0 30.6 Physical Contingencies 2.1 0.8 2.9 Price Contingencies 1.9 0.6 2.5 Total Project Costs 26.6 9.4 36.0
FinancinQ Plan
US$ million
Local Foreign Total
Beneficiaries 1.5 1.5
GOP 5.7 5.7 IDA 19.4 9.4 28.8 Total 26.6 9.4 36.0
US$ million
IDA Fiscal Year
Estimated IDA Disbursements 94 95 96 97 98 99 00
Annual 1.0 4.1 4.4 4.7 6.8 6.7 1.1
Accumulative 1.0 5.1 9.5 14.2 21.0 27.7 28.8
PAKISTAN
STAFF APPRAISALREPORT
NORTHERN RESOURCE MANAGEMENTPROJECT
I. PROJECT AND SECTOR BACKGROUND
Prolect Genesis
1.1 The Bank has been supporting developmental activities in Azad Jammu and Kashmir (AJK) since 1978, when the Hill Farming Technical Development Project (HFTDP) became effective. Following this three year project, the Government of Pakistan (GOP) requested that the Bank assist AJK with a follow- up project. The Integrated Hill Farming Development Project (IHFDP) commenced in 1985 and was completed in March 1992. The major objective of the project, which was confined to only two of the five districts in AJK, was to use the research results of the earlier project to introduce techniques to conserve AJK's environment and improve the welfare of its people.
1.2 Even before the completion of the IHFD project, the GOP requested that the Bank assist with a further project covering the three other districts of AJK, as well as the Northern Areas of Pakistan. FAO/CP preparatory missions visited Pakistan in November 1990 and again in October 1991 following which it was decided to exclude the Northern Areas as it was already well served by other donor assisted projects. The proposed project was redesigned between May and December 1992 to emphasize sustainable and efficient use of land resources through institutional restructuring and improving the policy framework that influences the use of land resources for the AJK. The project was appraised in March 1993. This project complements the Environmental Protection and Resource Conservation Project approved in FY92, in that it aims to implement sustainable resource management strategies at the field level while the emphasis of the former is on strengthening federal and provincial environmental protection institutions - legislation, policies and environmental screening programs.
Project Background
1.3 AJK is located at the foothills of the Himalayas. AJK covers an area of 13,300 km2 and has a population of about 2.6 million. The population rate of growth is 2.7 % per annum. Per capita income is only about US$280 per annum compared to US$410 for Pakistan. AJK has a special status vis-a-vis Pakistan. It has its own President, Prime Minister and Legislative Assembly and has a number of political, administrative and developmental responsibilities, but matters relating to finance and defence are handled by the GOP.
1.4 AJK is divided into five administrative districts. Public administration is supported by a number of local councils - five district councils, 129 union councils and 1,036 village councils. The responsibilities of the local councils include the development of social infrastructure within their communities and participation in development planning. - 2 -
1.5 Annual projections for expenditures and incomes by the Government of AJK (GOAJK) are set out in the budgets prepared by the Finance Department. In 1992-93, the total current income to government is projected to be Rs 995.0 million. The bulk of this (75%) is to come from various charges and revenues accruing to government agencies such as sale of electricity and royalties and profits from the sale of timber. Current non-developmental expenditures are expected to be Rs 4,433.0 million, leaving a current budgetary deficit of Rs 3,438.0 million. The current budgetary deficit as well as funds for capital expenditure are provided through loans and grants through the Ministry of Finance in Pakistan.
1.6 Over 90% of the population of AJK live in rural areas and are engaged in agriculture. Agriculture is carried out on small farms on terraced land and steep hillsides mainly for subsistence. Forest land covers 42* of AJK and the remainder is divided between cultivated land, cultivable waste land and uncultivable wasteland. Of the forest lands, about 27% is productive, 32% is potentially productive but currently poorly stocked, 6% is protective forests and 35% is permanent range. Most of the potentially productive forests are situated close to village settlements. Timber on shamlat (community owned) and Khalsa (state owned) land is practically exhausted due to excessive exploitation. The lack of proper management is a result of inadequate institutions and policies to ensure sustainable exploitation practices.
II. ISSUES,OBJECTIVES AND STRATEGIES
Natural Resource Management Issues
2.1 AJK's economy relies heavily on the productivity of its natural resources. However, these resources are deteriorating rapidly due to increasing human and livestock population and improper land use. Indiscriminate tree cutting on the hills and excessive grazing are resulting increasing shortages of fuelwood and fodder. It is also leading to a loss of soil cover and consequently severe degradation in hilly areas.
2.2 The productivity of crops, fodder, livestock and forests in AJK is very low and is declining. There is a close connection between poverty, agricultural productivity and environmental degradation. The major focus of policy makers, extension workers and farmers in AJK has been to increase agricultural production with insufficient attention paid to developing sustainable resource management systems. The primary institutions responsible for natural resource management in AJK - the Department of Agriculture (DOA), Department of Animal Husbandry (DOAH) and the Department of Forestry (DOF) are weak and in need of restructuring if they are to be responsive to AJK's most pressing challenges. There are market failures because of inadequate economic policies, and institutional and infrastructural weaknesses which have an adverse effect on resource management. There are government interventions in the production and input distribution activities which require a re- examination of the role of the private and public sectors. Past approaches to agricultural development emphasized investment in physical capital but there is a growing realization that there is a need for increased investment in - 3 -
institutional, organizational and human capital to fully utilize the results of research and proven technology for sustainable resource management.
2.3 Forests constitute the predominant land use in AJK and most of the potentially productive, but poorly stocked forest land is in the vicinity of villages and hamlets and is under severe pressure. Local communities have traditional rights to timber extraction for construction of buildings, deadwood and branches for fuel, collection of fodder and free grazing. Large areas of forests are denuded leading to soil erosion, disruption of the hydrological cycle, loss of wildlife habitat and the local population are gradually being deprived of valuable multi-purpose production and service functions provided by forests.
2.4 Rangelands are also subject to overgrazing. Vegetative cover is essential to ensure good infiltration and prevent rapid run off. Available indications are that localized degradation is taking place, especially in spring when pastures are grazed prematurely and some compaction of soils takes place. The erosion in the sub-watersheds in AJK has an adverse impact downstream. The rate of sedimentation in the Mangla catchment area, which is the area served by the watersheds of AJK, for the period 1967-83, was 34,000 acre feet per year.
2.5 Ineffective management of communal lands has been identified as the most important single reason for the degradation of non-arable lands. Overgrazing, over-harvesting and over collection of biomass products are cited as causes for this degradation; the central problem being the lack of sustainable protection and management. However, successful management through local community participation does provide a basis for developing new strategies with increased potential for sustainability. Recent approaches to the problems in Pakistan and neighboring countries emphasize the setting up of local community groups as beneficiaries to take on a greater responsibility for the management and protection of communal lands to ensure sustainable land resource management.
Institutional Weaknesses
2.6 The Planning and Development Department (P&DD) in AJK has the task of preparing and implementing development plans and coordinating, monitoring and evaluating the activities of the line agencies. P&DD is headed by the Additional Chief Secretary (Development) and comprises a Director General and five Chiefs of Sections covering Agriculture, Education and Industry, Health, Technical Services and Economic Affairs. P&DD is very poorly staffed and the plan formulation function is extremely limited. The monitoring function is confined to a few externally funded projects while evaluation is virtually non-existent. P&DD does not have the expertise or the staff to deal with resource management and conservation issues.
2.7 Under the Secretary, Agriculture and Animal Husbandry are DOA and DOAH. The present organizational structure of DOA and DOAH is in Chart I and Chart II, respectively. DOA is the key institution in AJK for the utilization, management and protection of the land resources. However, the current structure of the department is not suited to carry out these functions. The extension network is weak. The present ratio of one field officer to 2,000 farm families makes it near impossible for the extension staff to have regular contact with farmers. In addition, DOA has over the years expanded into input distribution and production activities, consequently promotion of new agricultural techniques has not received due attention. In a number of instances, DOA has responded to carry out production and input distribution activities directly, rather than through the farming or trading community.
2.8 Natural resource management has received little attention to date and DOA is ill-equipped to handle resource management issues in a comprehensive manner. There is a need for staff training and development to deal specifically with on-farm soil conservation and agro forestry for the hilly areas which typify most of AJK. Staff also need to be trained to be able to adopt new approaches to group formation of communities as beneficiaries. A Planning and Economic Services Section exists within DOA but its scope is limited. It has a skeleton staff; does not provide economic analysis on sectoral policy development and investment or conduct any evaluation of on-going activity. In addition, this section does not undertake any monitoring or evaluation of on-going or completed activities. DOA was last reorganized in 1974. The need for reorganization is accepted by the administration and DOA has itself unsuccessfully put forward proposals on several occasions.
2.9 Until now the mandate of DOA was to increase agricultural production and a fair degree of success has been achieved in this regard. The strategy adopted by DOA placed emphasis on: (a) introducing new agricultural technologies to the prevalent farming systems; and (b) providing inputs to the farming community through a widely dispersed extension service. While technical packages (TPs) have been developed for various agro-climatic zones, their prime objective has been to increase farm production with little attention to farm resource management, restoration of soil fertility and integrated pest management practices. With the increased emphasis of DOA on the production and input distribution activities, there has been an acute shortage of operational funding for developing different TPs which address the resource conservation issues of the various existing farm systems. The extension system which was strengthened and reformed in the IHFDP areas appears to lack sustainability: the elements of extensive and regular contacts with the farmers, supervision and accountability of extension agents, regular training, and extensive demonstrations have been considerably weakened. The extension service in other areas is mainly confined to inputs distribution. The training aspects of the extension agents and the farmers need to be based on a well defined strategy. The means to be deployed for imparting such training are either too few or are not compatible with state of the art technology. The development of TPs should not be viewed as a one time process: it needs to be constantly reviewed and refined so as to meet the needs and expectations of the farmers for whom the TPs are developed.
2.10 DOAH provides technical services to livestock producers. The major failure of DOAH to date stems from the fact that it has been unable to meet the challenge of changing the currently low productivity of livestock farming which relies too heavily on grazing on communal and state land and subsequent degradation. To meet this challenge, productivity of local animals have to be increased substantially through breed improvement and better feeding based on improved fodder and stall feeding. Both animal health and artificial insemination (AI) services are inadequate and fodder production falls short of the demand of AJK. The main animal health preventive services are currently undertaken by government and could be better done by the private sector. There is a need to strengthen research in fodder and stall feeding and improve the AI services. The staff is in need of training so as to be able to introduce new technologies to the farmer and the animal health staff should provide training to private vaccinators. There is also a need for DOAH staff to assist in community approaches to collection of fodder and stall feeding of animals.
2.11 The DOF is responsible for the protection, development and exploitation of forests, conservation of catchment areas, development of rangeland, tourism and wildlife management. The present organization is in Chart III. The major weaknesses of DOF is that until now it has not been able to introduce programs and policies designed to arrest the ongoing depletion of the forest areas both on state and communal lands. The staff of DOF have been overly concerned with the protection of state forests but have not succeeded in introducing a management or protection system which reduces the depletion of the state forests or involve the communities in the management of the forest resources on communal lands. The level of reforestation undertaken by DOF has lagged behind the rate of exploitation of timber and fuelwood by the local population. DOF has not been involved in any measurable way in the management and development of communal lands nor has it introduced farm forestry programs or community participatory approaches for the management and protection of communal lands. There is a need to train DOF staff in community participatory approaches, especially with fostering of new community institutions to take responsibility for the management of communal lands. There is also a need for greater emphasis on social forestry, evaluation of social forestry approaches in Pakistan and elsewhere, and for assistance in design of specific management systems for communal lands.
2.12 DOF has within its organization a Land Use Planning Unit which was set up in 1987 under the IHFDP project. This Unit has made a useful contribution to AJK through the preparation of recommended land use maps for watersheds and assisted in many other ways in the planning and development of AJK. While a substantial portion of its output is for DOF, there is a large unsatisfied demand for the services of the Unit from other government agencies. There is a need for the Unit to be strengthened and made more accessible to all government agencies so that it could play a more coordinated and effective role.
2.13 Responsibility for road construction and maintenance is shared by the Public Works Department (PWD) and the Local Government and Rural Development Department (LG&RD). The PWD is responsible for the primary and secondary road systems while LG&RD deals mainly with small unsurfaced roads. Under the Seventh and Eighth Plans, high priority was accorded to the GOAJK strategy of linking all district headquarters and construction of link roads to connect all Union Council headquarters. However, the achievements under the Seventh Plan fell far short of targets in part due to inadequately trained staff and limited equipment. The PWD can only undertake a small part of the work program in AJK. Road maintenance is poor because of a lack of funds and staff resources. Because of the limited capacity of PWD, the Frontier Works Organization (FWO), a military organization, undertakes road construction and maintenance as contractors to PWD. -6 -
InaRproRriate Regulations and Legislation
2.14 Pakistan's laws and regulations relating to the use of resources from state lands and communal property (which also apply to AJK) are outmoded and do not facilitate effective and sustainable natural resource management. While the AJK Forestry Department is responsible for managing both the state and community owned forests, they are often unable to prevent the community from engaging in unauthorized timber cutting, fuelwood collection and livestock grazing. Large disputes have often arisen between communities and the Forestry Department over ownership rights to forests. The laws and regulations which apply to all Pakistan (including AJK) are being addressed under the Bank assisted Environmental Protection and Natural Resource Conservation Project.
Little Public Awareness
2.15 Resource degradation and depletion have been considered to be a necessary adverse impact of agricultural development and policy makers in Pakistan did little to arrest this trend. However, more recently, there is increasing awareness that natural resource degradation can threaten growth itself and its cost to society in the long run could be extremely high. Public awareness, particularly among the poor and the illiterate needs to be increased through mass media and education if sustainable and economically efficient use of land resources is to be practiced by the community. Mass education is also necessary if community participation is to play a greater role in resource management.
Insufficient Community Participation
2.16 Like other provincial forestry departments, AJK has, till now, adopted an authoritarian approach to dealing with hill area communities. The Forestry Department needs to involve the communities in forest management and development, especially on communal lands. They have failed in their rangeland management responsibilities and have been slow to promote new practices. Many of the management practices are outmoded and must change to meet the problems created by increased human and livestock populations.
2.17 At the village level, agricultural activities are carried out by farmers on their own land as well as on the adjacent communal lands. The communal lands are mainly forests and rangelands which are used by farmers for extraction of fuelwood and for grazing of livestock on the basis of customary access. In recent years, increasing human and livestock populations have led to excessive exploitation of the communal lands. There is an institutional vacuum at the local level to address this issue as traditional institutions have become weak or disintegrated and new community institutions to manage natural resources have not emerged. Line agencies and community representatives have played their limited role in the process, but they are not substitutes for local participatory institutions.
2.18 Under the recently completed Bank assisted IHFD Project, a start was made for involving the communities in the management of communal lands through agreements which were entered into between the government and the community for reforestation and benefit sharing. Under these agreements the cost of plantation establishment and maintenance was borne by the government while the benefits (financial proceeds of the harvest) was to be shared by the community and the government on a 25:75 basis respectively. Similar practices were introduced in other donor assisted projects in AJK. The experience and lessons learnt from IHFDP and the Agha Khan Rural Support Program (AKRSP) provide an adequate basis for development of communal lands by the beneficiaries through community participatory approaches. The communities are more involved in the planning and execution of the program, the "top down approach" is being replaced by community based institutional structures which fill the institutional vacuum created by the breakdown of traditional institutions, and at least part of the operational costs of reforestation is being met by the community.
Policy Issues
2.19 In part due to the isolation, harsh environment and the low income levels, GOAJK has assisted the agricultural sector with programs and policies designed to increase agricultural production with little or no emphasis on sustainable land resource management. The overall policy framework is inadequate. There is an excessive involvement of government in activities which could be undertaken by the private sector. In addition, there has been no clear role for the public and private sectors in assisting the farming sector. Inputs are also heavily subsidized leading to market failures. Subsidies operate for fertilizers, forest and fruit tree seedlings, vegetable seed, and other food crop and fodder seed, and poultry vaccinations. The government is also engaged in the production of inputs such as forest and fruit tree seedlings, vegetable seed and seed potato, and has been engaged in the distribution of fertilizer, and field crop seed (wheat, maize and oats). The government has also provided subsidized animal health services.
2.20 In recent years, however, some of these subsidies have been gradually reduced or withdrawn. Fertilizers are now distributed through commission agents and pesticides are privatized. The subsidy on other inputs is gradually being withdrawn in line with the policy changes taking place in this regard for Pakistan as a whole. Government, however, has not reduced its role in input production and distribution activities. Nor has government yet been involved in any measurable way in sustainable resource management strategies designed to reduce the negative effects of the individual actions of farmers or the community at large by way of deforestation, soil erosion, rangeland degradation and loss of biodiversity.
2.21 There is increasing evidence that there is a divergence between private costs and social costs as a result of market, policy and institutional failures which result in spatial and inter-temporal externalities in the activities of the hill farming communities of AJK. The negative externalities - deforestation, rangeland degradation, siltation of reservoirs, loss wildlife habitats and hydrological imbalance due to the activities of peoples in and around their farms underscore the need for government intervention based on a sustainable resource management strategy. Policies should be put in place to reflect the true opportunity costs of resource use. Such intervention should take the form of providing incentives for adaption of sustainable resource management techniques in achieving increased productivity of resources, education, training and advise on sustainable and environmentally sound resource management techniques and practices to raise incomes. - 8-
Strategy for Hill Areas in AJK
2.22 The broad strategy for hill areas pursued under the project is consistent with overall Bank country assistance strategy for Pakistan. Its objectives are: (i) to increase the productivity and incomes of the farming community and reduce poverty; and (ii) develop and use natural resources in the hill areas of AJK in an economically sustainable and ecologically sound manner. The strategy emphasizes developing and strengthening human resources and local capacity and institutions; improving the policy framework through privatization and subsidy removal, formulating and extending adaptive research focussing on community groups and adaptive research aimed at introducing environmentally friendly TPs and farming techniques. The strategy takes into account the lessons learned from earlier Bank projects, the experience of other donors operating in AJK (International Fund for Agricultural Development and World Food Program) and of AKRSP, especially in group formation and community participation.
2.23 Specifically, the project will focus on: (i) revision of policies and regulations which contribute to resource degradation and poverty; (ii) institutional restructuring and strengthening, including support services, at both the level of government and of the local community; (iii) participation of local communities in project design and implementation to improve natural resource management, including management of common property resources; and (iv) provision of necessary infrastructure facilities for better access to markets.
National Conservation Strategy and Its Implications for AJK
2.24 The above strategy is linked with the National Conservation Strategy (NCS) of GOP for promoting effective natural resource and environmental management. The NCS evolved following extensive consultations with governmental and private institutions, NGOs, in particular, the AKRSP, and communities. The strategy is detailed as follows: create greater public awareness of the need for natural resource conservation; promote greater participation by local communities in resource conservation and sustainable land management practices; promote income generating activities through community participation on common property resources; enable grassroots organizations to identify, design and implement projects; target attainable development programs at lower income groups; identify non legislative incentives to develop good land husbandry; improve the quality of soil, water and air; and reduce soil erosion and sediment yield.
World Bank GrouR and Other Donors' Strategy
2.25 The Bank and other donors support Pakistan's resource conservation strategies as enunciated in the NCS. The Bank also supports GOP's goal of increasing community participation as outlined in the NCS. These strategies seek to link production with resource conservation and support the active involvement of the local communities in project planning, identification and implementation. A major emphasis is placed on income generating activities through group activities and pooling of financial resources through group effort, thereby enabling the community to take on increasing responsibility for introducing sustainable resource management practices. The major elements of the strategy supported through Bank operations are also aimed at reorienting public investment priorities to focus on improved efficiency of - 9 - resource use and a policy environment to foster sustainable resource management.
Bank Group Lending
2.26 The Bank Groups operations include:
(a) Salinity Control and Reclamation Projects (SCARPs) and Drainage projects to control waterlogging and salinity;
(b) projects to improve and rehabilitate the deteriorated irrigation system;
(c) projects to improve water use in watercourse commands and on farms; and
(d) agricultural extension and research, credit, seeds and environmental protection and conservation projects.
2.27 Bank group financing for related projects during the Seventh Plan period included the following operations: Agricultural Extension IV Project (Cr. 1762-PAK), Second Irrigation Systems Rehabilitation Project (Cr. 1888- PAK), National Oilseeds Development Project (Cr. 1936-PAK/Ln. 2973-PAK), Flood Restoration Project (Cr. 2003-PAK), Private Tubewell Project (Cr. 2004-PAK), Agriculture Credit Project (Cr. 2153-PAK/Ln. 3226-PAK), Agricultural Research Project (Cr. 2154-PAK), Third On-Farm Water Management Project (Cr. 2245- PAK/Ln. 3327-PAK), Second SCARP Transition (Cr. 2257-PAK), Fordwah Eastern Sadiqia Irrigation and Drainage Project (Cr. 2410-PAK), and the Environmental Protection and Resource Conservation Project (Cr. 2383-PAK).
Related Proiects and Lessons Learned
2.28 The Bank has undertaken several recent evaluations of rural development projects, including projects in the hill areas of the Himalayan range. In the broader evaluations of rural development projects, the Bank has paid particular attention to the causes for poor project performance. Many past projects have been too ambitious and complex, required exceptional leadership to succeed and could not be supported on a sustainable basis. Independent project management units were set up with facilities which are of a higher standard or intensity than in the rest of the economy, coordination between government agencies was weak, appropriate TPs were not always identified and strong government commitment to the project was lacking. In general, however, infrastructure components of these projects were successful and had high pay offs. A major lesson from these evaluations is that there is a need for a holistic approach to tackling resource management issues. It emphasizes the need for development of various forms of capital, and that sufficient consideration is given to policy reform and institutional changes.
2.29 In AJK, the Bank was involved in the pilot HFTDP in 1974 with the aim of establishing technically sound and economically viable methods for the development of the hilly areas of AJK. The major objectives were to assist in developing improved technologies in food, fodder, horticulture and tree crop production. The OED evaluation stated that, in general, the HFTDP enabled GOAJK to gain valuable experience in defining TPs and appropriate arrangements for solving the multiple problems of rural development. The project was - 10 - successful in developing TPs for maize and fodder production and hillside plantations, extend the area under quality apples and sustain the supply of vegetable seeds. HFTDP established a pattern for forest plantation on private and public land with an element of management. Notwithstanding its overall success, the major emphasis in the project was to increase productivity (output per unit of land) rather than correct policies and programs to ensure better management of resources.
2.30 The lessons learned guided the planning and formulation of the IHFDP which was introduced in 1984. The project objective was to arrest resource degradation and improve the welfare of the people. The draft evaluation report of the IHFDP states that technologies developed in the pilot program for maize, fodder and fuelwood have been accepted by farmers; experience gained in developing institutional arrangements for project management were successfully applied; and policy measures such as cost sharing and privatization of input distribution were instituted and the hill management strategy which is an outcome of the pilot program was the central theme of the follow up project. The evaluation report states that in terms of the hill management strategy, the project has met the objectives of increasing production of food, fodder and fuelwood from farm and wastelands; and development of land use plans for different uses. However, the project failed in its objective of improving the utilization of the upper watersheds including natural forests and pastures. This is to be addressed in the proposed project.
2.31 Lessons learned from IHFDP were that successful implementation is facilitated by non-bureaucratic management and proximity to the main center of decision making; the existence of a core team of technical and managerial staff; the availability of appropriate TPs before the start of the project; that local community involvement is necessary in the planning and implementation of projects; that planting of trees by government on communal land requires clear legal agreement with beneficiaries; that there is a need for better TPs for upper watersheds, including natural forests and rangelands; and that project design should clearly distinguish between activities where the market mechanism could bring about an efficient allocation of resources and where it cannot do so because of market failures or externalities. The report also states that road improvement designs should incorporate features and mechanical structures which minimize environmental damage.
2.32 The second OED evaluation of AKRSP emphasizes the need to give greater emphasis and resources to identification, testing and demonstration of new technology; improving animal nutrition and the coverage and effectiveness of vaccines, increased research into new fodder plant species for production around villages and multi purpose trees for agro-forestry. These are being pursued under the proposed project.
Rationale for Bank Involvement
2.33 The current roles and functions of key institutions responsible for resource management need to be realigned to meet re-defined objectives. Past government's efforts to restructure these institutions have not been successful. Through this project, IDA would assist AJK in restructuring of key institutions and reorienting of programs and policies: restructuring with emphasis on core services of technology dissemination and working with communities; introducing policy changes aimed at a phased elimination of - 11 - subsidies; and transferring public sector activities to the private sector. IDA would also support the introduction of hitherto untried environmentally sound and sustainable resource management programs. Moreover, IDA would support AJK in testing, on a pilot basis, programs whereby communities would take management and financial responsibility for planning and implementation of activities covering resource management. IDA is well placed in coordinating the efforts of donors involved in AJK, working in close collaboration with AKRSP.
2.34 This natural resource and poverty project complements Bank assistance elsewhere in Pakistan in resource management and small farmer productivity. Other assistance in natural resource management includes a natural resource management and poverty alleviation project under preparation for Balochistan. At the national level, there is the FY92 Environmental Protection and Resource Conservation Project.
MI. THE PROJECT
Proiect Obiectives
3.1 The main objective of this five year project is to provide for the sustainable and economically efficient use of land resources in one of the country's poorest and environmentally vulnerable areas through: (a) improving the policy framework within AJK (including the respective roles of the public and private sector) that influences the use and conservation of land resources; (b) restructuring and strengthening the main institutions that help manage and protect AJK's land resources; and (c) testing, on a pilot basis, programs whereby communities take management and financial responsibility for planning and implementation of activities for sustainable resource management.
Summary Description
3.2 The project would include the following:
(a) Policy Reforms. The input production and distribution activities carried out by DOA, DOAH, and DOF would be phased out through a program for transfer of activities and staff re-deployed in core areas of technology dissemination to farmers. Associated with the transfer is a program for the phased elimination of subsidies;
(b) Institutional restructuring of and sup0ort for DOA. DOAH. and DOF. Unsuccessful attempts have been made since 1974 to restructure these agencies. The proposal for restructuring was put forward by Government and the request is being refined to undertake cost effective institutional development to carry out the redefined objectives by drawing on the experience from other agencies. There is a strong government commitment to and ownership of the program. The approach is to set fairly tight limits on increases in public sector staff and the effect of these measures would be an overall net reduction in staff in the public sector. The process of restructuring would be implemented and monitored with the assistance of technical staff from Overseas Development - 12 -
Administration and/or United Nations Volunteers to be located in AJK and technical support from the Pakistan Privatization Commission and AKRSP. DOA would be reorganized into two directorates: extension and training, and technical support and a planning and economic services wing. The major area of emphasis of the restructured DOA is on core support services of technology dissemination, including working with communities. The production and input distribution functions would be handed over to the private sector and existing staff in these activities would be redeployed in the core activities. The Planning and Economic Services would be expanded. The field extension service would be strengthened and additional research support provided. The proposed organization is in Chart IV. DOAH would be restructured along functional lines, one to cover extension, research and development and the other, animal health. ReseArch capability would be enhanced. The proposed organizational chart is given in Chart V. DOF would be strengthened with the creation of a Social Forestry Wing (SFW). The DOF would be supported in its efforts to assist communities with reforestation and soil conservation programs and would draw on the expertise available in the SFW. The proposed organization is in Chart VI. The P&DD of AJK would also be strengthened by additional staff to assist in project formulation, monitoring and evaluation of resource management and conservation programs. A Privatization and Reorganization Unit (PRU), would also be temporarily established under P&DD, but without permanent status and with a built-in sunset clause. The Land Use Planning Unit would be moved from DOF to P&DD and strengthened to undertake a more central and expanded work program. The proposed organization of P&DD is in Chart VII. The PWD would be provided limited technical staff training for car;ying out the road improvement program.
(c) Basic Technical Services. These activities relate primarily to root stock propagation, foundation seed production, agricultural extension and adaptive research, animal health aid communal forestry. These activities would support the institutional restructuring as they provide the basis for several of the proposed core activities of initiation, demonstration and promotion of sustainable land management techniques, including proven, profitable TPs, adaptive research and extension for wider
application of TPs and developing new techniques. These - activities are based on the lessons from the previous Bank assisted projects;
(d) Pilot oroFrams in which farmers would take full responsibility for the planning, execution and financial management of the programs of communal lands. The pilot programs would be in five areas (sub- watersheds) already agreed to with GOAJK and the communities. A Social Mobilization Unit (SMU) would be set up to assist communities in group formation. The Unit would coordinate closely with the SFW. SMU would also assist the Integrated Pest Management Unit of DOA to mobilize women into mutually beneficial groups; and
(e) Rural road improvement to support the economic viability of the pilot schemes. - 13 -
Detailed Features
A. Policy Actions
3.3 Production and distribution activities would be eliminated under a phased program. The production activities to be transferred to the private sector are seed potato, fruit tree and forest tree seedlings and vegetable seeds. In addition, field crop seed distribution (wheat, maize and oats) and fertilizer distribution as well as poultry vaccination would also be transferred. Input subsidies which apply to all the above would also be eliminated under a phased program. Agreement has been reached at negotiations that GOAJK would implement the restructuring plan, including the program for the phased elimination of subsidies on inputs, phased transfer of the production input and distribution activities currently undertaken by the DOA and the re-deployment of staff. Details of the time phased program for transfer, subsidy removal and staff redeployment as agreed at negotiations are in Table 3.1. GOP/GOAJK agreed at neqotiations to implement the following:
(a) the reduction of subsidies as follows: (i) on notato seed, by 20% in each of the years beginning July 1. 1994, July 1. 1995 and JulY 1, 1996; (ii) on vegetable seed. by 15% in each of the years beginning July 1, 1994, July 1, 1995. July 1. 1996 and July 1997; (iii) on fruit seedling, by 15% in each of the years beginning July 1, 1994 and July 1. 1995; (iv) on bare root forest seedling. by 10% in each of the years beginning July 1. 1994 and July 1. 1995, and by 20% in each of the years beginning July 1. 1996, July 1, 1997 and July 1, 1998; and (v) on container forest seedling, by 15% in the year beginning July 1. 1994. and by 20% in each of the years beginning July 1, 1995. July 1, 1996. July 1, 1997 and July 1, 1998;
(b) the transfer of production and distribution activities to the private sector as follows: (i) in resPect of one potato seed farm in each of the years beginning July 1, 1994 and July 1. 1996; (ii) in respect of two vegetable seed farms in each of the years beginning July 1. 1994. July 1. 1995 and July 1. 1996, and one such farm in the year beginning July 1. 1997; (iii) in respect of five fruit seedling farms in each of the Years beginning July 1. 1995 and July 1. 1996, and in respect of four such farms in each of the years beginning July 1, 1997 and July 1. 1998; (iv) in respect of 11 ha of land producing forest seedlings, in the Year beginning July 1. 1995. 16 ha of such land in the year beginning July 1, 1996, 26 ha of such land in the year beginning July 1. 1997, and 16 ha of such land in the year beginning July 1, 1998; and (v) in respect of thirty-one fertilizer and seed stores in the year beginning July 1. 1995: and
(c) redeplovment of about 290 staff of DOA, DOAH, and DOF released as a result of the transfer of input production and distribution activities under (b) above for the Durioses of the Proiect as follows: (i) about 145 such staff in the year beginning July 1. 1995; (ii) about 70 such staff in the year beginning July 1, 1996; (iii) and the remaining such staff in the year beginning JulY 1. 1997. Table 3.1: Time-bound Phasing of Transfer of Activities, Staff Redeployment, and Removal of Subsidies
Activity PYI PY2 PY3 PY4 PY5 PotatoSeed Production Locations NeelumValley SudhanGali Staffredeployment,Nos. 2 10 Subsidy Reduction, X 20 20 20 Vegetable Seed Production Production staff of Locations Gujjarbandi,Shahkot KhariSharif, Hajira Bagh,Nar (Kotli) Jalalabad 3 basicseed farms Staffredeployment,Nos. 10 17 15 13 13 of 53 Subsidy Reduction, X 15 15 15 15 Fruit SeedLing Production Locations Serai, Bagh, Kahuta, Ganchattar,Lipa, Harama,Chamyati, Athmaqam,Hajira, Pallandri, Mandi Chikar, BaLdomas, Mang, Heer ShahMandi Abbaspur Staff redeployment, Nos. - 46 35 43 14 Subsidy Reduction, X 15 15 l Retain rootstock nurseries: Chattarklas, Devi Gali, RawaLakot, LangLa;but redeploy production staff 3 4 9
Forest Seedling Production Area, Ha 11 16 26 16 |- StaffredepLoyment, Nos. - 2 3 3 2 Zw Subsidy Reduction, X I Bare rootseedLing 10 10 20 20 20 Container seedling 15 20 20 20 20
Fertilizer/SeedDistribution Stores, Nos. Prepare 31; makeavailable privatization plan; to privatesector solicit Staff redeployment, Nos. interest/bids 86 Subsidy Reduction, X - ELiminate subsidy Remotesale points 5%as service charge Agree with private Finalize proposal to sector on compensate compensationmode transportation cost Poultry Vaccination Continue Continue Trainingof private Commencetraining Continuetraining Continuetraining privatization privatization vaccinators process process Cost recovery Nil Nil;set up Recover vaccine revolving fLundsto cost recuperatevaccine cost______- 1
B. Institutional Strengthening
(a) Department of Agriculture (Base Cost: US$ 2.03 million)
3.4 DOA would be reorganized into three directorates: extension and training, technical support, and planning and economic services. The major emphasis in the restructured DOA would be technology dissemination which would be backed up by technical and research support. Chart IV presents the reorganized structure of DOA. The planning and economic services under the Secretary, Agriculture and Animal Husbandry would also be strengthened. This unit would service both DOA and DOAH. Project support includes strengthening of the planning services include planning, monitoring and evaluation. Supporting technical staff as well as office equipment, vehicles and operating costs is also provided under the project.
3.5 The extension and training activities, especially field activities would be strengthened by additional staff through redeployment. New extension centers would also be set up in areas not presently served by extension staff. There would be no staff increment and these centers would be manned through re-deployment of staff. Incremental operating funds by way of travelling allowances and vehicle operating costs as well as office equipment would also be provided under the project. Specialized training for the re-deployed staff to match their skills for the new initiatives (mass awareness, community participation, soil conservation, and farm forestry) would be provided under the project. Technical assistance would be provided to evolve extension methodologies responsive to the needs of given areas with a view to optimizing field staff input and at the same time attaining greater coverage through contact group farmers and community participatory approaches.
3.6 With the organizational and institutional restructuring as envisaged under the project, a fundamental aim would be that the extension messages are delivered effectively to the diverse clientele in the project areas. Refinements to the existing extension system which has been modified from the principles of the Training and Visits system would be introduced. Alternative methods of extension, best suited to the needs of the prevailing farming systems, would be developed and put into practice. Special attention would be given to community participatory techniques so as to promote a sense of (a) ownership among the beneficiaries (as opposed to the traditional thinking that Government must provide inputs and other services through heavy subsidization programs, and that the extension services are taken for granted); (b) accountability of the system; and (c) responsiveness within the system to the needs of the farmers for appropriate technology and knowledge.
3.7 Continuous training of extension staff, at the field level, would be a key feature of the project to strengthen and update skills and knowledge of front line extension workers. Six new small training centers, equipped with training aids and audio-visual equipment (with a capacity for training 20-30 trainees) would be added to the four existing centers. At present, untrained Field Assistants (FAs) are recruited and then sent on training for a two year diploma at the Agricultural Training Institute (ATI). This results in vacant positions in DOA and lower quality inductees. At neaotiations. agreement was reached with GOP/GOAJK that by SeDtember 30. 1996. the ATI diploma would be a vrereauisite for recruitment to FAs positions in DOA. The - 16 - project would at the outset, provide 20 fellowships to prospective ATI students drawn from AJK for the FA Diploma Course through open competition. Those students who successfully complete the diploma would be considered for recruitment on the basis of merit.
3.8 Project support would be provided for reformulation of the production oriented TPs, through increased focus on adaptive and on-farm research encompassing appropriate soil conservation practices and cost effective farm management techniques (Annex I). The existing group of five core Subject Matter Specialists (SMSs) would be strengthened by adding a SMS (soil conservation) and SMS (community participation) and support staff. Project support would also be provided for institutional linkages and formal review mechanisms to ensure regular specialized sub-sectoral inputs into the programming, planning and analysis of adaptive research. Provision is also made for this group to undertake on-farm trials and testing programs throughout AJK. The Pakistan Agricultural Research Council (PARC) has already established an Agricultural Economics Research Unit (AERU) which would also be involved in reviews and would also be contracted to undertake diagnostic studies. Overseas training for the SMS group in their respective fields of specialization and technical assistance for continued refinement of the Training and Adaptive Research Unit's (TARU) program would be provided under the project.
3.9 Introduction of a farming systems perspective into the planning and programming process of the adaptive research program would be the main theme of institutional capability building. The project would promote a problem solving approach fundamentally oriented towards farmers and farmer participation mechanisms for collaboration in planning, execution of trials, and evaluation of alternative technologies.
3.10 To provide for low cost soil conservation practices at the farm level, an on-farm soil conservation demonstration program has been built into the project. Demonstrations would be conducted throughout AJK using three types of soil conservation practices. In-service training courses for the entire extension service specifically directed at soil conservation and resource management aspects have been included in the project.
3.11 Seed Ouality Control. As the production and distribution of all seeds, particularly those of vegetable and field crops, would be completely privatized in a phased manner, DOA is provided with a limited and small seed testing facility. A vehicle, operating costs, and incremental staff (through re-deployment) would be provided. Technical assistance and pre-service as well as refresher training would be arranged from the Federal Seed Certification Department
3.12 Mass Community Awareness xrogram. Mass community awareness program based on a well defined media dissemination strategy and availing of all existing channels of mass communication would be introduced to strengthen the extension effort. The program provides for the deployment of media and publication staff in a cell located within the TARU, provision of local technical assistance from professional media experts, production of audio/video and print materials (documentaries, cassettes, posters, brochures and leaflets) and creation of a small in house reproduction/editing facility. Media campaigns on natural resource management, soil conservation, community participation, awareness of resource degradation, and environmental hazards of - 17 -
modern farm inputs would receive special focus under the program. The program would cater to reaching all groups in the community, not only farmers.
(b) Department of Animal Husbandry (Base Cost: US$ 2.56 million)
3.13 DOAH would be restructured along functional lines, under two directorates. The first directorate would cover all animal health. The other under the Livestock Coordinator (who would be redesignated as Director) would cover livestock extension, research and development. The proposed structure is in Chart V.
3.14 Limited research staff would be inducted to the Livestock ,Development Center (LDC) to conduct fodder research, breed improvement and nutrition trials. LDC has already taken possession of additional land adjacent to it for this purpose. An SMS would be attached to the LDC to provide technical support to the research activities, prepare technical extension packages to ensure sustainable resource use and assist in training of Stock Assistants (SAs), the FAs and the female mobile teams in poultry vaccinations both at the LDC and the ATI. The research staff would be provided with equipment and supplies for research experiments and trials. Vehicles and operating costs would be provided to the research teams. A training room, equipment and training aids would be provided at the LDC for the training programs and for the courses for livestock staff and women vaccinators. Proposed refresher training with an emphasis on sustainable resource management strategies would be organized for SAs and Livestock Supervisors manning the veterinary dispensaries.
3.15 In the field of animal health, project activities are directed at ,increasing the present low coverage of vaccination programs through institutional support and extension. Efforts to increase investment in fodder research, breed improvement and nutrition would not be meaningful without an expanded program of disease prevention. Provision is made for the construction of additional veterinary dispensaries, to which DOAH would re- assign SAs from present locations where they are supernumerary or assign new SAs on completion of their induction training. Motorcycles would be provided to Veterinary Officers who would supervise field staff in vaccination and extension programs and a vehicle would be made available to collect vaccines and to distribute to district level holding and collection points. Refrigerated vaccine holding equipment would be provided at district and union council level facilities, and cold boxes would be repaired and reinstalled in veterinary dispensaries. The project would provide for increased annual vaccinations to about 401 and 15% for large and small ruminants respectively, thereby doubling the present coverage for three major diseases afflicting livestock in AJK. Commencing in the second year, the poultry vaccine would achieve about 90% coverage of susceptible village flocks in the dependent dispensary areas. A program of cost recovery of vaccines would be implemented beginning in the second year of the project. Agreement was reached with GOP/GOAJK at negotiations that a revolving fund would be set up in DOAH for the deposit of vaccination fees and the purchase of subseauent vaccine suvrlies. - 18 -
(2) Department of Forestry (Base Cost: US$ 6.02 million)
3.16 Due to increased reforestation and soil conservation activity, particularly on communal lands, the project provides for additional contractual staff who would be hired for the duration of the project.
3.17 In view of the increasing importance of community participatory approaches as is being introduced under this and other donor assisted projects, a Social Forestry Wing would be created and attached to the Office of the Chief Conservator of Forests (CCF). This is in line with the project's support for community based reforestation and soil conservation programs, based on the experiences gained and lessons learned from IHFDP and AKRSP. The Wing would be provided with a Social Forester and three support staff as well as a vehicle, office equipment and operating costs. Technical assistance for a social forestry expert to assist in setting up the Wing and planning its work is also provided under the project. The proposed structure of DOF is in Chart VI.
3.18 Provision is made under the project for community based reforestation. Plantation costs cover the cost of seedlings, digging of pits, restocking and 50' of restocking and protection costs. Plantations would take the form of timber, fuelwood and pasture in different combinations. In addition, the project would provide for soil and water conservation works which would include gully plugging, loose stone checkdams, masonry diversion channels, masonry silt trap dams, gabions for torrent control, planting behind checkdams, vetiver grass hedges, contour bunding and protection walls and a seedling distribution program. Forestry seedlings production would also be met from the project and would initially be produced in DOF nurseries but would progressively be produced by the private sector with DOF purchasing its requirements.
3.19 Provision is also made for training in forestry extension and in soil conservation techniques. The former is directed at farmers, private nurseryman and local community leaders and the latter at Foresters and Forest Guards. In addition, Divisional Forest Officers and Forest Rangers would receive training of a weeks duration in forestry extension at the Pakistan Forestry Institute. An internationally recruited specialist would be engaged for conduct of the initial courses and draw up course material and curricula. The project would provide support for the Forestry School to assist in training.
3.20 The project provides for overseas training in woodlot management, soil and water conservation and social forestry and technical assistance in range management, extension and training, seed collection and handling and seed orchard establishment.
C. Other Institutional Strengthening. (Base Cost: US$ 2.67 million)
3.21 Provision is also made under the project to strengthen the AJK P&DD. A small unit of three staff would be set up within P&DD as a nucleus for project formulation, monitoring and evaluation of resource management and conservation programs and strategies. In addition, the unit would be responsible for addressing environment and resource management issues as they - 19 - arise (Paragraph 2.6). Provision is made for this Unit to be supported by short term consultants. The Unit would be under the Director General, P&DD.
3.22 The DOF had within its organization a Land Use Planning Unit which was set up in 1987 under an earlier bank project (Paragraph 2.12). Under the project, this Unit would be placed under the P&DD, and would receive support for an expanded program of work. The Unit would be strengthened by additional staff - a land use planner, surveyor and cartographer and supporting technical staff. In addition, project support would include provision of technical equipment for land use planning and mapping, office accommodation and operational costs, including the costs of materials for printing of maps.
3.23 The project would support a PRU consisting of three senior staff and supporting staff for implementing the privatization and restructuring program. The Unit would also be provided with office equipment, vehicles and operating costs as well as technical assistance to monitor progress and annually evaluate the program.
D. Basic Technical Services (Base Cost: US$ 6.97 million)
3.24 The previous two Bank assisted projects have laid the basis for root stock propagation, foundation seed production and development of TPs. In addition, these projects introduced adaptive research programs, set up agricultural training facilities, introduced animal disease control campaigns, forestry research and training and provided the basis for community based reforestation. All these activities provide a sound foundation and would be built on for carrying out programs to meet the redefined objectives of these agencies. The project provides for modest support for these ongoing activities.
3.25 The extension system which was strengthened under IHFDP lacks sustainability and regular training and farmer contact and demonstrations have been considerable weakened. TARU which was set up under IHFDP consisting of the core team of SMS's would be provided support to continue with the training and adaptive research, including research trials and demonstrations on plant protection, breeding and improved root stock (apple) propagation and dissemination. The on-going training programs for extension staff under the training and visit system introduced under IHFDP would also be supported. The animal health programs have proved to have an impact but its continuation through periodic follow up is necessary and the project provides for equipment and operational funds for continuation of the on-going campaigns. The community based forestry program, introduced under the IHFDP provided for a degree of community participation on communal lands. Reforestation was undertaken on 11,700 ha of communal/private land following agreements with the communities and the project provides for follow up work on these plantations by way of annual maintenance and protection of the reforested areas (Paragraph 2.18). Provision is also made for operational funds for forestry and soil conservation research and training.
E. Pilot Areas (Base Cost: US$ 1.86 million)
3.26 The project would support community participatory activities in the five pilot areas covering approximately twenty villages. The criteria used for the selection of the pilot areas included: extent of degradation of the - 20 - sub-watersheds; willingness of the community members to participate and supply labor for activities and be an active member of the Village Development Committee (VDC), pool financial resources, and agree to bear full operational cost of project activities. A Social Mobilization Unit comprising a Coordinator, and three social organizers would be set up under the project to interact with the communities and assist in group formation. One of the social organizers would be a woman, responsible for group formation of women and the promotion of income generating activities as part of the overall management plan. The Unit would be provided with office equipment, farm and other equipment and transport to enable field visits to the pilot areas. The programs supported by the project in the pilot areas include the preparation of development plans and establishment of village development committees, training of community leaders and women, and introduction of programs and TPs for community lands and for private farmers. Programs include demonstrations and adaptive research trials, tree nurseries, reforestation, introduction of TPs and treatments and soil conservation practices and income generating activities and specific activities for women (Annex II). The program would also support the reforestation of communal lands and the provision of planting material for re-stocking and limited maintenance. All these programs are so designed to ensure adequate and quick returns to the farmers and the community as a whole to assist in maintaining interest and financial sustainability. Many of the activities would be based on successful approaches adopted in other community participatory projects and are designed to ensure sustained participation in management of communal resources. Income generating activities would be introduced both at the individual and community level to ensure additional income which could provide incentives for group activities. Soil erosion monitoring would also be undertaken in the pilot areas through point measurements made in critical areas such as steep slopes using simple techniques. Agreement was reached at appraisal with GOAJK that five sub- watersheds of Bhanguin, Hular, Baluch, Chhota Gala and Sensa would form the pilot areas.
F. Improvement to Rural Roads (Base Cost: US$ 8.44 million)
3.27 Under the project, a total of twelve roads totalling 165 km are to be taken up for improvement. The details of the roads proposed for improvement and the pavement design standards appear in Annex III. All these roads are in close proximity to the proposed five pilot areas and would offer better access to main roads. In addition to improving these to all weather standard, they would also be built to correct the ill planned and poorly constructed roads to reduce soil erosion.
Proiect Costs and Financing Plan
A. Proiect Cost Summary
3.28 The Project Cost Summary by components is in Table 3.2, and Annexes Tables 1 and 2 provide additional details and breakdown of these costs. PAKISTAN
NORTHERN RESOURCE MANAGEMENT PROJECT
Table 3.2: Project Cost Summary
(Rs Million) (US$ '000)
% Total % Total Foreign Base Foreign Base Local Foreign Total Exchange Costs Local Foreign Total Exchange Costs A. Institutional Restructuring and Support Agricultural Services 36.0 58.4 94.3 62 12 1,394.2 2,244.4 3,628.5 62 12 Agriculture Extension & Adaptive Research 9.1 11.6 20.7 56 3 351.3 444.7 796.0 56 3 Comunity Forestry £ Resource Management 141.0 15.6 156.6 10 20 5,423.6 601.0 6,024.6 10 20 Commnity Awareness & Education 3.5 1.0 4.4 22 1 132.8 36.6 169.4 22 1 Policy, planning a Evaluation 51.4 18.1 69.4 26 9 1,976.0 694.9 2,671.0 26 9 Subtotal Institutional Restructuring and Support 241.0 104.6 345.5 30 43 9,267.9 4,021.6 13,289.5 30 43 B. Basic Technical Services 139.7 41.6 181.3 23 23 5,372.2 1,601.9 6,974.1 23 23 -
C. Road Improvemnt 179.6 40.0 219.6 19 29 6,905.9 1,538.8 8,444.7 18 28
D. Pilot Areas 26.3 22.1 48.4 46 6 1,011.9 850.9 1,862.8 46 6
Total BASELINE COSTS 586.5 208.3 794.9 26 100 22,558.0 8,013.2 30,571.2 26 100 Physical Contingencies 55.2 21.9 77.0 28 10 2,121.6 841.4 2,963.0 28 10 Price Contingencies 141.3 44.0 185.3 24 23 1,893.8 577.2 2,471.0 23 8 Total PROJECT COSTS 783.0 274.2 1,057.2 26 133 26,573.4 9,431.8 36,005.2 26 118 - 22 -
3.29 The project costs are estimated at Rs 1,057.2 million (US$ 36.0 million) equivalent (inclusive of contingencies, local taxes and duties) of which the foreign exchange component is Rs 274.2 million (US$ 9.4 million) Project costs are expressed in January 1993 prices and include duties and taxes estimated at Rs 159.4 million or US$ 5.4 million. The base costs are derived from detailed cost schedules applied for current federal and other government agency operations, including agricultural extension, reforestation, animal health improvement, construction contracts, and vehicle and equipment purchases. Construction cost estimates are based on current schedule of rates. Consultant services are based on recent contracts for similar services in Pakistan. The cost estimates provide for physical contingencies of 12% for civil works and 10% for machinery, equipment and materials, technical assistance and training. Price contingencies are estimated at Rs 185.3 million and are based on projected domestic and foreign inflation rates as shown in Table 3.3.
Table 3.3 Projected Domestic and Foreign Inflation Rates
FY International Domestic
93 4.0 12.0 94 2.8 9.5 95 2.3 6.0 96 3.1 6.0 97 3.5 6.0 98 3.5 6.0
B. Financing
3.30 Table 3.4 shows the proposed project financing plan. The GOAJK, the local community farmers and households would jointly finance the project. IDA would provide credit of SDR 20.4 million (US$ 28.8 million), the community and farmers the equivalent of US$ 1.5 million and GOAJK the remaining US$ 5.7 million equivalent. IDA would finance 80.0% of project costs, including 100% of foreign exchange costs and 52% of local costs. Excluding duties and taxes, and community farmers and households contributions, IDA would finance 98% of project costs. Community and farmers, through their own labor would finance a portion of works on communal lands and reforestation. GOAJK would provide a part of the finances to the implementing agencies out of annual budgetary allocations. Funds for project expenditures would flow from the Ministry of Finance directly to GOAJK as development funds. Agreement was reached with GOP/GOAJK at negotiations that the Executive Committee of the National Economic Council (ECNEC) would apnrove the proi6ct's Planning Commission Form No. 1 (PC-1) and sanction Proiect exvenditure Prior to credit effectiveness. - 23 -
Table 3.4 Financina Plan (US$ Million)
IDA Government Community
Institutional Strengthening & 12.3 2.3 0.8 Support Services
Basic Technical Services 6.5 1.3 0.3
Road Improvement 8.2 2.0 -
Pilot Areas 1.8 0.1 0.4
TOTAL 28.8 5.7 1.5
Percent 80 16 4
Procurement
3.31 Procurement arrangements are summarized in Table 3.5 and are described in more detail in the paragraphs that follow:
Table 3.5 PROCUREMENT ARRANGEMENTS (US$ million)I/
Procurement Element ICB LCB Othera' NIF 1 / Total
Civil works - 11.6 - 0 .44/ 12.0 (9.3) (9.3) Field Works - - 5.7 1.43/ 7.1 (5.3) (5.3) Vehicles 2.1 - - - 2.1 (1.3) (1.3) Equipment and 1.2 - 2.4 - 3.6 materials (0.9) (1.9) (2.8) Technical Assistance - - 4.2 - 4.2 (4.0) - (4.0) Training and studies - - 0.9 - 0.9 (0.9) - (0.9) Incremental staff and - - 6.1 6.1 operating costs (5.2) (5.2)
3.3 11.6 19.3 1.8 36.0 (2.2) (9.3) (17.3) (28.8)
1/ Includes taxes, duties, and contingencies. Figures in parenthesis are the respective amounts financed by the IDA credit. 2/ Includes force account,international and local shopping, consultant services, training and project management expenditures. 3/ Not IDA financed. 4/ Purchase of land. 5/ Contribution by community. - 24 -
3.32 Civil Works (USS 11.7 million). Civil works would include construction of buildings, such as extension centers and veterinary dispensaries and improvement of small sections of rural roads, totalling about 165 km. All these works are in remote rural areas, are small and scattered, and spread over the five-year period of execution. These works would not be of interest to foreign contractors and would be packaged into contracts and follow local competitive bidding (LCB) procedures acceptable to IDA.
3.33 Field Works (US$ 6.8 million). Minor works relating to tree planting, torrent correction, watershed management and other soil conservation works are small and scattered and are located in remote areas throughout AJK. These works also involve labor provided by beneficiaries and would not attract bidders. Works not exceeding US$ 50,000 per package and up to an aggregate amount of US$ 5.7 million equivalent would be undertaken by force account. Works on communal lands would be undertaken jointly by the government and the community, with the community contributing their own labor for selected activities as their contribution. The complementary government activities would be undertaken by force account.
3.34 Vehicles and Eauipment and Materials (USS 5.6 million). Vehicles, equipment and materials would be packaged into contracts of at least US$ 50,000 equivalent or more and procured following IDA international competitive bidding (ICB) procedures and using IDA standard bidding documents for the procurement of goods. Domestic preference limited to 15% of the cif bid price or the actual customs duty applicable to non-exempt importers, whichever is lower, would be granted to goods manufactured locally in the evaluation of bids. GOP confirmed at negotiations that an application has already been made for issue of a No-Objection Certificate (NOC) allowing for the vehicle imports amounting to US$ 2.1 million. GOP agreed at negotiations that the implementing agencies would use ICB bidding documents based on the Bank's sample bidding documents for goods. Equipment, goods and materials such as fencing, farm equipment and veterinary supplies needed at different places and valued at less than US $50,000 equivalent for each contract, could be locally and internationally procured through shopping on the basis of comparing price quotations obtained from at least three eligible suppliers in accordance with the Bank's guidelines for procurement. The total value of goods purchased through shopping would be limited to an aggregate of US$ 2.4 million.
3.35 Consultant Services. Training and Studies (USS 5.7 million). Consultant services in an amount of US$ 4.8 million financed from the proceeds of the credit would be selected and employed under terms and conditions acceptable to the Bank in accordance with the Bank's guidelines for the use of consultants. Prior IDA review of consultant contracts above US$ 50,000 would be required. Training services totalling US$ 0.9 million would be made on the basis of relevance and quality of the programs offered by governmental or private institutions according to government administration procedures acceptable to the Bank.
3.36 Incremental ODerating Costs (USS 5.8 million). Project expenditures on incremental operating costs, including staff salaries and allowances, operation and maintenance of vehicles, equipment and civil works would follow normal government practices. - 25 -
3.37 Each contract estimated to cost the equivalent of US$ 200,000 or more would be subject to prior IDA review. However, in practice, the first three bidding documents in excess of US$ 50,000 for each year would be subject to prior review by IDA before the bidders are invited to bid. If standard bidding documents and IDA procedures are consistently used , prior reviews will be carried out only on contracts in excess of US$ 200,000 in conformity with the guidelines. This would cover about 10% of the value of works and of the goods. Bank staff would undertake a selective post review of works on a random basis on contracts for all civil works and for goods below US$ 50,000 equivalent with a sample of one in every ten contracts. All procurement would be undertaken by the office of the Project Director attached to the Secretary, Agriculture and Animal Husbandry. This office has sufficient experience in procurement as a result of two previous Bank projects. The procurement implementation schedule is in Annex VI.
Disbursements
3.38 The credit would be disbursed over a period of six years which is inclusive of the time allowed for disbursement after credit closing on 12.31.99. This is less than the length of the standard disbursement profile for all Pakistan agricultural projects. The experience gained by the staff of DOAH in dealing with implementation and procurement matters under two Bank projects since 1978 is the reason for the shorter disbursement period. IDA would disburse funds at the following rates:
Cateaory Percent to be financed
Civil works, field works 80% of expenditures and forestry planting
Foreign and local training, 100% of expenditures consultancies and studies
Vehicles, equipment and materials 100% of foreign expenditures; 100% of ex-factory prices of locally manufactured items; 70% of local costs for other items purchased locally
Incremental staff and 100% until an amount equivalent Operating Cost to SDR 1.7 million; 60% thereafter until an amount equivalent to SDR 2.8 million; and 30% thereafter.
3.39 IDA would disburse against certified statements of expenditure for civil works: (a) civil works below US$ 200,000; (b) vehicles, equipment and materials below US$ 50,000; and (c) all consulting firms of less than US$ 50,000 and all field work, forestry planting and incremental staff and operating costs. All other contracts including those for foreign training and - 26 - individual consultants would be fully documented. Implementing units should have available all supporting documentation for these items of expenditure for review by IDA. Disbursement applications for all other items should be fully documented. The estimated schedule of disbursements appear in Annex IV.
3.40 To facilitate timely implementation of activities, a special account would be established at the National Bank of Pakistan to be operated by Secretary, Agriculture and Animal Husbandry. This account would cover all expenditures, both local and foreign of less than US$ 160,000 (10% of the initial deposit). All other expenditures above this amount could be submitted directly to IDA for payment. Replenishment applications would be made on a monthly basis or whenever the available balance in the account dropped below 50%, whichever occurred first.
Retroactive Financing
3.41 In expedite project start up, IDA would retroactively finance project costs incurred after April 1, 1993 up to a limit of SDR 1.5 million, provided IDA procurement procedures and guidelines were followed. These expenditures would include consultant services for SMU, PRU, designs of road improvements, initial establishment of nurseries, and other preparatory activities.
Accounts and Audit
3.42 Implementing agencies would maintain separate accounts for project activities. At neaotiations, agreement was reached with GOP/GOAJK that: (a) implementing agencies would maintain separate proiect accounts which independent auditors acceptable to IDA, would audit annually: (b) have their auditors issue separate oDinions on project accounts, disbursement from the special account, and SOEs and supporting documents used as a basis for disbursements from the credit; and (c) submit an audit report of prolect accounts to IDA within nine months of the fiscal year's end.
IV. ORGANIZATION AND MANAGEMENT
Implementation
4.1 The project is to be implemented by DOA, DOAH, DOF and PWD. The Secretary, DOA & DOAH would have overall responsibility for the project. To assist the Secretary, in carrying out these tasks, the project provides for a senior officer to be appointed as Project Director, and be responsible to the Secretary for all matters relating to the project. Coordination of project activities would be provided through the AJK P&DD which would be strengthened under the project. A SMU would be set up under the Secretary, Agriculture and Animal Husbandry to assist with community participatory approaches while PWD would be strengthened to carry out the expanded road improvement program. These departments already have staff experienced in the implementation of the HFTDP and the IHFDP, the latter which closed on March 31, 1992. Technical - 27 - assistance would enhance the capacity of the implementing agencies to implement the project as adequate provision is made under the project for locally and internationally recruited technical personnel.
4.2 PWD. The preparation of designs, surveys and bill of quantities would be carried out by consulting engineers. An Executive Engineer from PWD who would be assigned to the project would have overall responsibility for prequalification of contractors, preparation of tender documents, invitation of bids, supervision of the work by contractors and authorizing payments on completion of work. The Executive Engineer would be assisted by two sub- engineers. The completed work would be handed over to the PWD for subsequent maintenance.
Institutional Strengthening and Policy Reform
4.3 Transfer of Activities. To ensure a smooth phasing out of public sector activities, subsidy removal and staff redeployment, GOAJK has already established a high level Committee consisting of the Additional Chief Secretary (Development), P&DD, Secretaries of Finance, Agriculture and Animal Husbandry, and DOF to formulate policies and plans required for implementation. Implementation would be undertaken by a Privatization and Reorganization Unit, located in P&DD and responsible to the Additional Chief Secretary,(Development). This Unit, when established, would also service this Committee. The Unit would be staffed with qualified and experienced officers, including an Establishments Officer responsible for detailing the staff re- deployment program, the skills retraining requirements and preparation of revised duty statements. A technical assistance input is also provided to enable review and evaluation of the progress of the institutional restructuring and privatization program on an annual basis. The Unit would initiate action on the different measures necessary for the successful execution of the program for transfer of activities and restructuring program.
4.4 DOA. DOA, headed by the Director General, Agriculture (DGA) would be responsible for implementing the project in the Department. The DGA would also be responsible for implementing the phased program for withdrawal of subsidy on inputs. The DGA would coordinate closely with the PRU and agree on annual production targets on inputs by DOA and the private sector and make arrangements for the gradual transition. The DGA would also take actions for the phased increase in the price of inputs.
4.5 The two Directorates of Extension, Training and Adaptive Research (ETAR) and Research and Technical Services (RTS), under the overall operational responsibility of the DGA, would formulate an extension strategy which meets the challenges of sustainable agricultural development. The core functions of developing appropriate TPs, training the extension agents and community groups, and disseminating extension messages to farmers would be handled by the ETAR Directorate.
4.6 The main functions of the RTS Directorate would be to act as a resource group for: (a) providing the required technical services to the public and private sectors; (b) maintaining the basic and foundation seed production facilities as well as horticultural root stock; (c) developing and - 28 - testing techniques of integrated pest management as applicable to the AJK environments; (d) assisting the government in developing the regulatory framework for ensuring the quality of key farm inputs supplied by the private sector (seed testing and certification, varietal uniformity, purity of seedlings, fertilizers and pesticides); and (e) acquiring the basic and applied agricultural production technologies, as they evolve, from the national and international agricultural research systems and building them the on-farm trials program of ETAR.
4.7 For the field extension operations, Director, ETAR would ensure the implementation of extension strategy through direct line district level extension organization. The district extension network would be supported by the training, adaptive research, and mass awareness units under the ETAR. Each district would have a Deputy Director, Extension (DDE) who would be responsible for the deployment and supervision of extension agents, or the FAs, through the area extension supervisors, or the Agricultural Officers (AOs). In addition to the line functions, DDEs would be responsible for the administrative supervision of the Assistant Horticultural Officers, AOs, and Research Officers who would technically be a part of the RTS group, or the SMS group of the ETAR.
4.8 The DDEs would be the chief implementers of the extension strategy based on the specific agro ecological zones falling within the extension district. The strategy, to be devised from the overall AJK strategy, would provide the guiding principles on the modes of message dissemination, farmers group organizations, the role and extent of media coverage, and the role and extent of farmers training. For the formulation and/or adaptation of the extension strategy, DGA would ensure participation of all working groups within DOA, and other national institutions.
4.9 The TARU, supervised by the Deputy Director, would be the technical arm of ETAR. TARU would draw heavily on RTS, but would have its independent work program in several disciplines: adaptive research and on-farm testing of appropriate technologies; technical message formulation; regular training of extension agents; mass communication and implementation of media strategy; and training of trainers at district level. All TARU staff would be based at Garhi Dopatta. Three more disciplines would be added to the existing SMS group: SMS (Soil Conservation and Resource Management), SMS (Community Participation) and SMS (media/mass communication). The former two SMSs would chiefly work with the SMU and would provide intensive support to the pilot impact areas while the latter would provide leadership to the Media/Information Cell of the DOA, in addition to handling the media and mass awareness campaigns.
4.10 The project provides for adequate mobility and operating funds for the extension service to be more proactive. All DDA/SMS level posts would be provided with four wheel drive vehicles; all AOs with motor cycles; all RTs section chiefs with vehicles; and all village extension agents would be given travel and daily allowances.
4.11 DOAH. DOAH through its Director General would be responsible for the implementation of activities relating to livestock support services. The - 29 -
Director General would be responsible for the phased program of privatization of the vaccination services and ensure coordination between training of community and farm groups in vaccination methods and re-deployment of staff. The Director General would ensure that the Livestock Coordinator who is head of the LDC (and also Director) would carry out the fodder research and animal nutrition programs under the project. LDC would be the focal point of the improved extension and training. Applied research and training at the field level would be supervised and directed by the Livestock Coordinator and the SMS (Livestock). The Director General would also be responsible for the improved program of animal health services from department hospitals and dispensaries. The Director, Animal Health would be responsible for the field veterinary services and the immunization campaigns as well as the network of dispensaries throughout AJK.
4.12 DOF. DOF through the CCF would be responsible for implementation of all forestry related activities under the project. These would include nursery establishment, reforestation, pasture management, seedling distribution, soil conservation works, extension and training. The reforestation, soil conservation and pasture management activities would be carried out on communal and private lands throughout AJK, including the pilot areas. The CCF would be assisted by a team of professional staff consisting of a Conservator of Forests and two Divisional Forest Officers, and technical and support staff. A Social Forestry Wing, comprising a Social Forester and support staff would be attached to the CCF. This Wing would collect, independently and through the technical assistance provided to it under he project, information on and interact with on going social forestry projects within Pakistan and in the region, and advise the CCF on possible participatory approaches. To foster community participation of the in carrying out nursery establishment, reforestation and soil conservation works the CCF would assist in training of community members in social forestry and arrange local study tours to other social forestry projects. A Soil Conservation Wing, comprising a Soil Conservation Engineer and support staff would advise on the design and specifications of soil conservation structures and ensure that the works are carried out according to specifications.
4.13 The CCF would coordinate with the Privatization and Reorganization Unit on the tree seedling program in achieving the objective of a gradual transfer to the private sector. The CCF would be responsible for the training of private nurseryman and women's groups. The CCF would also introduce a phased program of subsidy removal on forest tree seedlings. Until the subsidy is completely removed in the last year of the project, the Forestry Department would purchase seedlings from private nurseryman to meet the demands of reforestation and seedling distribution.
4.14 All field operations would be carried out through Divisional Forest Officers (DFOs) in the Divisions in which the activity is located. The CCF would be responsible for coordinating with the SMU that would work in drawing up management plans with the communities. The CCF, through DOF staff would seek out, identify and assist in areas of reforestation on communal lands, and advise individuals and the VDC's on the technical aspects of reforestation and participate in the formulation and implementation of management plans by the community in the pilot areas. DOF staff would be involved in the agreements - 30 - specifying the cost sharing and management responsibilities on reforestation activities outside the pilot areas.
Pilot Areas
4.15 Five pilot areas based on subwatersheds have been selected in consultation with GOAJK authorities and the community. The approach to be taken is participatory, seeking to actively involve the community with the main focus on sustainability. Integrated works in forestry, range management, agriculture, livestock and other income generating activities would be undertaken. The selection of the five pilot areas was on the following basis: (i) extent of degradation of the subwatersheds; and (ii) willingness of the community to participate and supply labor for activities, be an active member of the VDC, pool financial resources, and agree to bear the full operational cost of project activities.
4.16 SMU and the community would draw up a detailed management plan for each village. The SMU and technical staff from DOA, DOAH and DOF would identify suitable TPs and assist in drawing up the management plan. The SMU would be responsible for the formation of VDCs in the five pilot areas. The SMU would ensure participation of the community in implementing of the plan. Activities selected would include programs on individual farms as well for the community. In addition, activities for women would also be incorporated into the management plan. The plans would be flexible and be reviewed at regular intervals. During the project period, the VDCs would be strengthened to take over the responsibility for plantation, pasture and protection of the communal lands. The management plans would ensure that income is generated through the management plans starting from the initial years to ensure sustained community participation. The VDC's would be encouraged to open a savings account for deposit of income from the communal property. Agreement has been reached that the community would bear the cost of planting and in addition, would bear half the cost of protection (watch and ward) on all communal land. Under the pilot areas the cost of protection would be borne by the community on an increasing proportion until full costs and these would gradually be extended to other project areas as well (See Appendix IV). The community participatory approach adopted in the pilot areas would be closely monitored and assisted by experienced personnel from NGO's (such as AKRSP) to evaluate its replicability in other areas of AJK.
Monitoring and Evaluation
4.17 MonitorinQ. Monitoring of all project activities would be undertaken by the monitoring and evaluation staff in the Planning and Economics Wing of DOA. This would involve the progress of works and programs, civil works and contracts, staffing and project finances. DOF would undertake close monitoring of the community development activities in the pilot areas to help decision makers obtain quick and regular feedback on implementation progress, and to make rapid adjustments, if and when required. Because of the grass roots nature of this component, details of the community plans and the type of investments cannot be known before agreeing to the community plans. This component is inherently flexible, which makes the role of monitoring far more difficult and important. The SMU group would be required to travel - 31 - extensively for monitoring and quarterly reporting is required for the first two years of the project.
4.18 Reporting. The Project Director, under the Secretary, Agriculture and Animal Husbandry would coordinate the preparation of annual work plans and budgets and monitor project activities and prepare quarterly reports of project activity describing the current status, deviations, if any, and problems encountered during the quarter. GOAJK would also be requested to provide an annual progress report and to participate in the annual Bank- Government review of project implementation to enable undertaking a review of resource requirements and take appropriate actions as necessary to ensure that the project objectives could be met. The Secretary, Agriculture and Animal Husbandry and staff of the Planning and Economic Services would also be required to prepare a Project Completion Report (PCR) six months prior to project closing date summarizing the overall project performance in the context of its objectives and targets.
4.19 Proiect Launch Workshop. A Project Launch Workshop would be held for staff, community leaders, and NGOs associated with the project, soon after the project agreements have been signed to familiarize project staff with project objectives, components, and other administrative aspects of project implementation, including procurement.
4.20 Mid-Term Review. A mid-term review of the project would be conducted during the third year of project implementation and not later than three years from date of project effectiveness. The mid-term review would be carried out jointly by the Government and the Bank and the terms of reference for the review would be drawn up by the Office of the Secretary, Agriculture and Animal Husbandry and approved by IDA. The purpose of the mid-term review is to allow an opportunity, based on the experience of the initial years, to make required changes, if any, that may be necessary to procedures or policy; make revisions to set targets and goals and identify any additional measures that may seem warranted to improve project implementation. The mid-term review could also serve to identify any follow up operations that may be considered appropriate for continued IDA involvement in the sector.
4.21 Supervision. The project would require average supervision, except in the first year when project works are initiated and the Social Mobilization Unit is involved in finalizing the work plans of the communities and defining their management responsibilities. A higher supervision input is justified in the first year in view of the expected high degree of local community participation in project activities. Except for the first year, IDA would use approximately 12 staff weeks per year for supervision, Details of supervision arrangements are further elaborated in Annex V. - 32 -
V. BENEFITS, JUSTIFICATION AND RISKS
Benefits
5.1 The nature of project activities, namely introduction of resource management techniques, institutional restructuring, privatization and extension, are such that benefits cannot be readily quantified. In addition, externalities, particularly in conservation activities in the hilly areas, in the watersheds, and through reforestation defy ready quantification, although the benefits are likely to be significant. Such benefits could take the form of reduction in soil loss, landslides, downstream sedimentation, including siltation of reservoirs and preservation and conservation of bio-diversity. These activities would improve the quality of life of most of the 2.6 million people living in AJK.
5.2 Farmers in AJK will directly benefit through the introduction of environmentally friendly TPs which would enhance incomes. In the area of human resource, training activities and the public awareness programs will provide a better knowledge of environmental degradation and remedial measures for conservation of resources. The project would contribute to the empowerment of local communities, to the creation of local management capabilities and to the acknowledgement and enhancement of the role of women in the management of natural resources.
5.3 The road improvement component would improve twelve fair weather roads to all weather access roads. The improvement would enable year round movement of farm inputs and outputs and other basic requirements, such as fuelwood and food, open up the remote agricultural areas and induce higher agricultural production, reduce vehicle operating costs and save travel time.
5.4 Economic Rates of Return (ERRs) were calculated for some of the project activities. ERRs were undertaken individually for each of the proposed roads. The ERRs ranged between 9-17*. For reforestation activities, ERRs were calculated for timber, fuelwood and fuelwood-pasture plantations. Their ERRs averaged 16%. The project impact on farm income was analyzed through representative farm models, with estimation of the net increment to income through the introduction of improved TPs. On this basis, the estimated ERR for farm activities was 17%.
5.5 To evaluate the overall viability of the project, the ERR was calculated for the whole project, inclusive of total cost elements such as the pilot areas and institutional development. The ERR for the whole project is 13%.
Table 5.1 Economic Rates of return
Reforestation Activities 16% Farm Activities 17% Road Improvement 169
Total Project 13% - 33 -
5.6 The ERR for the whole project is not substantially lower than the ERR of main project activities, and is because most of the costs had been already accounted for in these components (82%). The estimated ERR for the whole project is conservative as all benefits have not been quantified. Such unquantified benefits arise from positive externalities such as reduction in soil loss, landslides and down stream sedimentation and from the time lag in realization of benefits particularly in investment in human capital such as training and technical assistance as well as in the pilot areas.
5.7 To test the sensitivity of the calculated ERR to possible adverse outcomes, an analysis of switching values of key variables was carried out. For the total project, cost increase of 10% with a simultaneous decrease in benefits by 10 would reduce the ERR to 12%, the assumed opportunity cost of capital. If project benefits were delayed by one year, the ERR declines to 11. The details of the economic and farm budget analyses and the sensitivity analysis by component appear in Annex VII.
Environmental Effects
5.8 The proposed project has been reviewed under the provisions of the operational directive 4.00 Annex A (Environmental Assessment), and placed in category "B". An environmental review was carried out to assess the significance of the environmental effects of the activities proposed, and to determine measures to enhance environmental management in the project area.
5.9 Activities under the proposed project seek to improve the existing production systems and infrastructure facilities, and are complemented by interventions aimed at improving resource management and the quality of the environment in AJK. Moreover, specific safeguards and practices would be incorporated into the design and implementation of project activities, as well as supportive institutional arrangements for resource management and oversight.
5.10 As in most of the rest of Pakistan, there is currently no mechanism in AJK to facilitate consideration of environmental and resource management concerns into development planning or decision making. Senior staff would be provided under the project to be located in the P&DD, and have oversight for resource management and environmental matters of all development projects. The P&DD is the most appropriate location for this oversight, given its mandate for coordinating, monitoring and evaluating government programs and projects. Technical assistance would be provided under the project to develop procedures for environmental screening and monitoring of development projects and to train P&D staff for this purpose.
5.11 With respect to specific activities, the agricultural activities are largely expected to have a positive impact on the environment, particularly through improving perennial tree crop cover through the promotion of horticulture, and by improving the production of cereal and fodder crops, and reducing pressure on hillside grazing areas. Livestock grazing has been a major source of erosion and degradation of environmentally fragile hillsides. Improved pest management is expected to follow guidelines on appropriate policies and procedures as in the Project Agreement. The project would support the use of pesticides, only as a last resort in controlling pests and disease, that is during epidemics and pest management campaigns. The activities relating to livestock, which are related to fodder production and - 34 - research would also have a positive environmental impact by reducing grazing pressure on the hillsides. The project would promote soil conservation through training and demonstration. The National Agricultural Research Center (NARC) would be encouraged to complete the collection of plant crop germplasm from AJK.
5.12 Work to be undertaken in the forestry sector, with local community participation and cost sharing, is expected to have a substantial positive impact on the environment. The project would help meet the urgent need to reverse the rapid degradation of forest lands. It would improve soil and water conservation, enhance tree cover, and by providing fodder and fuelwood, relieve the pressure on the existing natural forests. Local communities would be involved from the outset in participatory forestry programs and the formal agreements would specify the responsibilities of the community and the distribution of the benefits.
5.13 The feeder road improvement program is expected to have no major impacts on vegetation, wildlife or other land uses. There are no resettlement issues involved. The feeder roads would be designed with adequate provision for drainage, treatment of slopes to avoid erosion and retention walls would be provided at weak locations. Moreover, the aim of the road improvement work is to correct the problems of ill-planned and poorly constructed roads which have contributed to soil erosion and landslides in the past. Design and construction supervision would be the responsibility of consultant engineers, and construction would be closely monitored to ensure compliance with agreed design standards.
Risks
5.14 The possible risk is that the local community may be slow in forming community participatory groups. However, it is expected that experience already gained by the community in recent participatory approaches including AKRSP, the active involvement of the Social Mobilization Unit, combined with technical input from the government support services and mass education and training under the project would contribute to a high level of farmer interest.
5.15 Another risk is that the returns from the project may be inadequate. However, experience to date with the development and dissemination of TPs has, on balance, been positive. The returns to rural roads has been quite good. Using pilot projects on promising but as yet not widely tested approaches before widespread dissemination will mitigate risks. The risk of financial sustainability of public sector resource management institutions is being addressed by reducing the overall net size of the public sector.
5.16 A final possible risk is that the privatization, subsidy removal and staff redeployment program may encounter implementation delays. Adequate safeguards have been built into the project such as the preparatory activities (appointment of consultants and senior staff of the Privatization Unit), prior government approval of the time phased program, adequate training of staff, close monitoring and annual evaluation to ensure that the program as envisaged remains on track. - 35 -
VI. AGREEMENTSAND RECOMMENDATIONS
6.1 The following agreements were reached with GOP and GOAJK during negotiations:
(a) GOP/GOAJK agreed to implement the following (Para 3.3):
(i) the reduction of subsidies as follows: (a) on potato seed, by 20% in each of the years beginning July 1, 1994, July 1, 1995 and July 1, 1996; (b) on vegetable seed, by 15% in each of the years beginning July 1, 1994, July 1, 1995, July 1, 1996 and July 1, 1997; (c) on fruit seedling, by 15% in each of the years beginning July 1, 1994 and July 1, 1995; (d) on bare root forest seedling, by 10% in each of the years beginning July 1, 1994 and July 1, 1995, and by 20% in each of the years beginning July 1, 1996, July 1, 1997 and July 1, 1998; and (e) on container forest seedling, by 15% in the year beginning July 1, 1994, and by 20% in each of the years beginning July 1, 1995, July 1, 1996, July 1, 1997 and July 1, 1998;
(ii) the transfer of production and distribution activities as follows: (a) in respect of one potato seed farm in each of the years beginning July 1, 1994 and July 1, 1996; (b) in respect of two vegetable seed farms in each of the years beginning July 1, 1994, July 1, 1995 and July 1, 1996, and in respect of one such farm in the year beginning July 1, 1997; (c) in respect of five fruit seedling farms in each of the years beginning July 1, 1995 and July 1, 1996, and in respect of four such farms in each of the years beginning July 1, 1997 and July 1, 1998; (d) in respect of 11 ha of land producing forest seedling, in the year beginning July 1, 1995, 16 ha of such land in the year beginning July 1, 1996, 26 ha of such land in the year beginning July 1, 1997, and 16 ha of such land in the year beginning July 1, 1998; and (e) in respect of thirty-one fertilizer and seed stores in the year beginning July 1, 1995; and
(iii) redeployment of about 290 staff of DOA, DOAH and DOF staff released as a result of the transfer of input production and distribution activities under (ii) above for the purposes of the Project as follows: (a) about 145 such staff in the year beginning July 1, 1995; (b) about 70 such staff in the year beginning July 1, 1996; and (c) the remaining such staff in the year beginning July 1, 1997.
(b) ATI Diploma would be a prerequisite for recruitment to Field Assistant positions in DOA by September 30, 1996. (Para 3.7);
(c) a revolving fund would be set up in DOAH for deposit of vaccination fees and finance the purchase of subsequent vaccine supplies (Para 3.15); - 36 -
(d) implementing agencies would: (i) maintain separate project accounts which independent auditors, acceptable to IDA, and audit annually, (ii) have their auditors issue separate opinions on project accounts, disbursement from the special account, and SOEs and supporting documents used as a basis for disbursements from the credit, (iii) submit an audit report of project accounts to IDA within nine months of the fiscal year's end (Para 3.42).
6.2 The IDA credit would not become effective until ECNEC has approved the project's PC-1 and sanctioned project expenditures (Para 3.30).
6.3 Subject to the above agreements and conditions of effectiveness, the proposed project would be suitable for an IDA credit of SDR 20.4 million (US$ 28.8 million) to the Islamic Republic of Pakistan on standard IDA terms with 35 years maturity. - 37 -
ANNEX I PAKISTAN
NORTHERNRESOURCE MANAGEMENT PROJECT
RESOURCEMANAGEMENT TREATMENTS AND TECHNIOUES
Introduction
1. The project provides for support to extension services and adaptive research under the framework of the reorganized Department of Agriculture (DOA). To redefine DOA's strategy for enhancing overall farm productivity, it is important that DOA reverts to its core function of agricultural extension with a renewed vigor. This can be achieved by: (a) gradually phasing out the inputs production/distribution functions and redeploying the resources so released to support and strengthen the extension services; and (b) reformulating the intensive production oriented technical packages (TPs) through increased focus on adaptive and on-farm research encompassing appropriate soil conservation practices and cost effective farm management techniques. The reformulated TPs must have a strong orientation of productivity restoration and maintenance.
2. The main objective of the project is to provide for institutional strengthening of DOA, particularly streamlining the field extension in the areas not covered in the previous projects. The project will add more extension centers and extension circles, provide the necessary physical infrastructure, and ensure better staff mobility to increase buoyancy of the extension service in reaching out to a larger clientele. Incremental funds would be provided to meet the needs of an effective service. Rationalization of the present organization also provides room for better supervision of the field staff by creating two new supervisory positions at the Divisional level and providing specialized training for the redeployed staff to match their skills for the new initiatives. Technical assistance would be made available to evolve extension methodologies responsive to the needs of given areas with a view to optimize field staff input and at the same time attain greater coverage through contact group farmers and community participatory approaches.
Implementation
3. The generation of reformulated TPs, and their refinement on location specificity grounds would be a continuous process for which adequate operational funds, mobility, and the necessary materials and equipment are provided. The existing group of five core Subject Matter Specialists (SMSs) would be strengthened by adding an SMS (Soil Conservation and Resource Management) and an SMS (Community Participation), through redeployment and intensive training. The unit, called "Training and Adaptive Research Unit" (TARU), would be back-stopped by Research and Technical Support Services (DOA), Livestock Development and Research (DOAH), and Forestry Groups. Cross inter and intra-institutional linkages and formal review mechanisms would be built into the operational procedures for TARU to ensure regularized sub-sectoral inputs into the programming, planning and analysis of adaptive research. The unit would - 38 - undertake on-farm trials and testing programs in the entire project area. To facilitate the execution of such programs in the remote districts, additional Research Officers are provided. The Agricultural Economics Research Unit (AERU) of Pakistan Agricultural Research Council (PARC) would be a part of the TARU's programming review mechanisms and it would be contracted to undertake agro- ecological zone based diagnostic studies through multi-disciplinary TARU-AERU and other research support teams. In addition to providing funds for such activities, AERU would also conduct ad hoc studies which would be identified during project implementation. Overseas training facilities for the SMS group in their respective fields of specialization, and technical assistance for a well balanced off-take and continued refinement of TARU's program planning and analytical endeavors are provided.
4. An on-farm soil conservation demonstration program has been built into the project to promote low cost soil conservation practices at the farm level. The SMS (Soil Conservation), with assistance from the soil and water conservation section of the DOA, would conduct about 500 demonstrations in the entire State. Initially, three models/TPs have been identified involving a mix of on-farm terrace improvement, check damming and soil stabilization through perennial grasses, orchard trees, and agroforestry. Further, adaptive research in this crucial area would be directed to evolve more area specific farm- compatible TPs to arrest degradation of farm land resources caused by intensive cultivation and overgrazing. In-service training courses for the entire extension staff, specifically directed to soil conservation and resource management aspects, have been included in the project.
5. The project also provides for continuous training of the extension staff, at the field level, to strengthen and update skills and knowledge of the front line extension workers. Mobile teams of SMSs would regularly impart training to extension agents and farmers and obtain feedback on farmers' constraints in implementing the reformulated TPs. Six new training centers, fully equipped with training aids and audio-visual equipment, would be added to the four existing centers, and all centers would be made fully operational in catering to the training needs.
6. To strengthen the extension effort, mass awareness program, based on a well defined media dissemination strategy and availing all existing channels of mass communications, would be provided. The program would include deployment of media and publication staff in a cell located with TARU, provision of local technical assistance from professional media experts, production of audio/video and print materials (documentaries, cassettes, posters, brochures and leaflets), and the creation of a small in-house reproduction/editing facility. Media campaigns on natural resource management, soil conservation, community participation, enhancing farm land productivity and fertility through biological systems, awareness of resource degradation, and environmental hazards of modern farm inputs would receive special focus under the program and cater to not only farmers but all groups in the community.
Technical Packages
7. During the past decade (1980-90), technical packages (TPs) for increasing the production of field crops and orchards were developed in AJK through applied - 39 - and adaptive research, including on-farm trials, for three altitude based domains (low, mid, and high altitudes corresponding to 1000 m, 1000-2000 m, and above 2000 m) . Three levels of inputs, based on farmers resource endowments, were built into the TPs with a view to optimizing farm outputs. The focus of the existing TPs was on increasing production, not necessarily productivity, and little attention was paid to natural resource management, soil conservation, and the maintenance of inherent soil fertility to the extent possible. Under the project, these missing aspects would be given due consideration in developing new TPs or reformulating the existing ones. For comparison purpose, TPs for low domains and medium level of technological inputs, with improved/certified seeding materials for four representative crops, are listed in the matrix presented below:
Crops Activity/Inputs I ExistingTPs I ProposedTPs Maize SowingTime May-June May-June Ploughings(no.) 3 2-3; rowsorientation in harmonywith recommendedsoil conservation practices Seed rate(kg/ha) 60; drillingor handplacement 60; drilling/placement Seed Treatment 200 g/ha fungicide 200 g/ha fungicide Weed Control Handweeding/weedicides (eg. Farm Laboronly Stomp)a 3-5 l/ha Fertilizers(kg/ha 75:40:0;without considering More relianceon FYM; greenmanuring; of N:P:K) FarmYard Manure's (FYM) input and redefinefertilizer dosage FYM No emphasis 2,500kg/ha/year Plantprotection Chemicalcontrol; 20 kg/ha Pest scouting;integrated pest granuLarpesticides for management(IPM); and minimalreLiance controllingstem borer on pesticides
Wheat SowingTime November-December November-December Ploughings(no.) 2-3 1-2;rows orientation in harmonywith recommendedsoiL conservation practices Seed rate (kg/ha) 100;driLLing or broadcasting 100;driLLing/placement Seed Treatment 300 g/hafungicide (Vitavax) 300 g/hafungicide Weed ControL Handweeding/weedicides (eg. Farm Laboronly Buctril)a 1-2 l/ha Fertilizers(kg/ha 75:50:0;without considering More reLianceon FYM;green manuring; of N:P:K) FarmYard Manure's (FYM) input and redefinefertilizer dosage FYM No emphasis 2,500kg/ha/year (for maize/wheat) Plantprotection None None. Diseasecontrol through seed selection;seed treatment; and cultural methods - 40 -
Oats Sowing Time October-November October-November Ploughings (no.) 2-3 1-2; rows orientationin harmony with recommendedsoil conservationpracticesI Seed rate (kg/ha) 60 (seed), 80-100 (fodder); 60 (seed), 80-100 (fodder);drilling or drilling or broadcasting broadcasting Seed Treatment 200 g/ha fungicide(Vitavax) 200 g/ha fungicide(Vitavax) Weed Control None None Fertilizers(kg/ha 75:50:0;without considering More relianceon FYM; green manuring; of N:P:K) Farm Yard Manure's (FYM) input and redefine fertilizerdosage FYM No emphasis 2,500 kg/ha/year (for maize/oats) Plant protection None None. Disease control through seed treatment;and cultural methods
Apples Planting Time March March Pit Preparation 0.5 m deep, 0.3 m diameter 0.5 m deep, 0.3 m diameter pits; pits; pulverized soil fill pulverized soiL fill; integratewith on-farm soiL conservationmodels Seedling rate/ha 300 plants 300 plants SeedLing Treatment Formaldehydea 1.5 L/ha FormaLdehydea 1.5 L/ha Fertilizers(kg/ha N: 30-150 in years 1-5; Linear N: 25-125 in years 1-5; Linear of N:P:K) P: 35-175 in years 1-5; Linear P: 30-150 in years 1-5; Linear FYM 6,000 kg/ha/year 7,500 kg/ha/year Plant protection Gusathion/M.Parathion sprays; IPM; Pest scouting;emphasize or Phostoxintablets for trunk bioLogicalcontrol; or use Phostoxin borer tablets for trunk borer when infestationlevels exceed economic injury threshold
Grasses Recommended Since there has been little Medicago sp., Dectylisglomerata, species focus on planting grasses, Festuca sp., Apluda artistata, Clovers, technicalpackages do not Vetiver grass. exist. The available Planting time informationon recommended Both Rabi and Kharif seasons. species,agronomic practices, Availablearea and conservationmeasures is Approx. 20.30X of wastelandfarm area; fragmented and needs .2 x .25 m strips for 20X, and .3 x .25 formulation into discreet m strips for 30X model; also include packages. terrace ridges.
Seed rate Based on individualspecies.
Fertilizer Phosphatesor NP 2 18.23 kg/ha as P.
Farm yard manure As much as available;usually 1.2 tons/ha year.
Range Management Grazing by rotations;allow time for regeneration. - 41 -
ANNEX II
PAKISTAN
NORTHERN RESOURCE MANAGEMENT PROJECT
COMMUNITY PARTICIPATORY APPROACH
Objectives
1. The community participatory approach adopted in this project is based on a review of contemporary participatory approaches in comparable social conditions in hilly areas of Pakistan as well as neighboring countries. The main focus of this approach is on participation and privatization leading to sustainability and financial independence. It promotes active community participation at the grassroots in the long-term management of natural forests, plantations, rangeland, agriculture and increased production of livestock. The major objectives are to: (a) involve local communities in the planning and execution of the program for the development of the communal lands; (b) change the top down approach and set up community based institutional structures to fill the institutional vacuum caused by the breakdown of traditional institutions; and (c) test, on a pilot basis, ways of mobilizing resources, including financial resources and achieving ways by which the community would meet full operating costs of development activities. This would involve: (i) group formation and community participation for the preparation of integrated resource management plans with the community directly participating in decision making and financial management of the resources; and (ii) introduction of activities and establishment of systems for pooling of financial resources generated by the community which could be utilized for the further development and management of community resources. The results achieved in these pilots areas will be continuously monitored and evaluated and applied progressively to other areas.
2. The main features of the approach are: (i) a two-tier collective forum of the people at the community and village level for carrying out the planned activities and at the operational level for necessary support, coordination and monitoring; (ii) an action plan of development works; (iii) an extension, education and training program for upgrading skills of the people through community based change agents (male and female); and (iv) a community mobilization unit at the operational and implementation level. All project interventions will be determined in consultation with collective forums of the people and channeled through them as for as possible. The level of participation and privatization would be different for various project activities.
3. The project would include support for activities in five pilot sub watershed areas (20 villages) under which farmers would be encouraged to take full responsibility for the planning, execution and financial management of the programs on communal lands. These five areas have already been selected by government and the community. These sub watersheds, by and large, were selected on the following criteria: extent of degradation; willingness of community to participate and form Village Development Committee (VDC); pool financial resources and bear full operational cost of project activities. The lessons and experiences in the pilot area will be incorporated into the community - 42 - participation agreements drawn up in the latter project years. Table 1 gives acreage under agriculture, pasture, forest and fuelwood in each of the five sub watersheds:
Table 1: Area Distribution of Model Sub watersheds (acres)
Name District Agric. Pasture Forest Fuelwood Total
Banguin Poonch 4015 1962 1023 2000 9000 Hular Bagh 3357 1731 3400 1662 10150 Baluch Poonch 1307 3001 3005 843 8150 Chhotagala Poonch 2179 2920 2186 2920 10205 Sensa Kotli 3248 1682 1600 1600 8130
4. A detailed management plan would be drawn up for these model sub watersheds which would cover forestry, range management, soil conservation, agriculture and livestock management interventions needed for integrated development. The management plan would be approved by the Subject Matter Specialists (SMS) and the Social Mobilization Unit (SMU). A utilization plan would also be drawn up for the pasture land and plantation of the treated sub watersheds. The communities would be educated in the sustained use of the resources and would be organized as village development committees (VDCs) to take over the responsibility of plantation, pasture, and livestock management.
Institutional Arrangements
5. Social Mobilization Unit. A SMU would be set up to motivate and mobilize village communities and organize them into VDCs in the sub watersheds. The SMU would be staffed by three social organizers (2 male and one female) and a coordinator. They would remain mobile in their respective sub watersheds -each male would be given specific watersheds, while the female would work in all the five sub watersheds. The SMU will convene meetings to finalize management plans and proposed interventions. These plans would be flexible, regularly reviewed and changed according to the needs and priorities of the local people.
6. The Social Organizers (SOs) would be assisted by the professional and technical staff of the Ministry of Agriculture and Animal Husbandry and Ministry of Forestry. The technical staff would closely collaborate with the SOs and provide assistance for preparation and implementation of resource management plans. Technical assistance would be made available to evolve methodologies responsive to the needs of given areas with a view to optimize field staff input as well as attain greater coverage through contact groups and community participation. The TORs of the Coordinator and SOs are given below:
Terms of Reference
7. SMU Coordinator. He will be responsible for: (i) supervising the work of three SOs and coordinating with the line agencies; (ii) preparing report on the SMU performance and evaluation; (iii) organizing training for staff and farmers in managing and dealings with VDCs; and (iv) organizing SMU meetings. - 43 -
8. Male Social Organizers. They will be responsible for: (i) organizing, guiding and strengthening of VDCs; (ii) training and supervising village motivator/extension and project staff in issues related to community organization and participation; (iii) assisting the villagers in planning, implementing and monitoring the forest and range utilization schemes and field works, and in managing the livestock resource, agriculture land, and savings mobilization; and (iv) assisting the Coordinator, VDCs and SMS in preparation and implementation of management plan for each model sub watershed.
9. Female Social Organizer. She will be responsible for: (i) implementing women activities in energy conservation, tree and fodder nurseries, kitchen garden, livestock management and improved animal husbandry; (ii) identifying and supervising other activities and income generating programs for village women; (iii) forming and strengthening women organization and encouraging savings habits; (v) supervising the work of female village motivators; and (vi) identifying training needs for women and project staff in issues related to women in development and preparing information dissemination materials geared to women.
10. In addition, the SMU as a whole, would be responsible for preparing training materials for interdisciplinary and interactive planning and group organization and supervision; resource use and management including cost and benefit sharing; and sustainable agricultural development.
11. Village Development Councils. A VDC would be set up in each participating village with the assistance of the SMU. Twenty VDCs would be constituted during the project period. The VDCs would involve the community in planning, execution and community sharing of benefits. A motivator from the village would be selected as a bridge between the VDCs and the project. During the project period these VDCs would be strengthened to take over the responsibility of plantation, pasture and management of the communal lands and other activities. The managing body of VDCs consisting of a President, Manager- Secretary, and Treasurer would look after the daily activities. The responsibilities of a VDC would be to enroll all households in the village as members and inculcate in them group discipline, hold meetings at regular intervals and formulate and implement proposals, undertake works related to development and physical infrastructure and arrange for maintenance and repair of community works, raise savings and funds as equity capital and issue and recovery of loans, settle disputes amicably through arbitration or mediation and maintain proper accounts. The VDCs would be encouraged to open a village savings account where savings from grasses, fuelwood and other activities would be deposited. These savings would be utilized for common cause and the most immediate needs of the community, identified by the VDC. Agreement has been reached with the district Councils that the communities bear 50 percent cost of protection (watch and ward) on all communal and private land reforestation.
Maior Programs
12. Major programs for the development of pilot areas are: mass awareness, community organization and development, development schemes, extension education and training, women development and sectoral activities.
13. Mass Awareness. Mass awareness can be done in two ways: through mass media - print and electronic - at the project level, and through orientation of - 44 - local people, display of posters at community centers and talks to collective forums at the community level. The SMU would be responsible for coordinating with the media and publication unit of DOA to obtain leaflets/posters, pamphlets, banners, slides, videos, and for organizing rallies, fairs, conventions and exchange visits.
14. Community Organization and DeveloRment Plans. The SMU would collect information about each subwatershed area and update it on a regular basis. Based on this information, the SMU would assess needs of the communities regarding subwatersheds/forest, agriculture/crops, livestock, poultry, occupational, physical infrastructure and list existing collective forums (such as, mosque, hujra, Zakat committees, Youth Associations, etc.). The next step would be to identify local resources, assess available manpower, contact individuals, groups and communities and muster local resources for the needs identified. Finally, the SMU would carry out surveys to assess the goals and priorities of the local population which would involve collection and updating of information through reconnaissance survey or rapid rural appraisal or training-survey-planning, analysis of the information and diagnosis of the problems, suggestion of remedial measures in consultation with and active participation of the people, formulation of feasible schemes for the proposed solutions and consolidation and compilation of the schemes and development plan for each sub watershed.
15. Development Schemes and Activities. These would involve plantation of subwatersheds, raising of nurseries for sale to forest department/farmers, kitchen/courtyard garden by women, training in livestock improvement and poultry keeping, and vocational skills and equipment for men and women.
16. Extension Education and Training. This would involve improvement and updating know-how, expertise and skills of rural communities particularly in: group order and discipline, capital formation through regular savings, profits from sale and other commercial activities, agriculture, livestock, poultry, forestry, soil conservation, fruit and vegetable production, physical infrastructure schemes and management and book keeping. Training would be conducted in the following areas at regular intervals: (i) cultural practices - soil/agronomy, seed, fertilizer and plant protection; (ii) poultry and livestock - feed, disease control and treatment and improved breeds; (iii) small development works and income generating schemes - formats, feasibilities, execution, supervision/monitoring and evaluation; and (iv) health education.
17. Women in Development. This would involve: (i) survey of women resources and their potential role through rapid appraisal; (ii) upgrading their vocational skills; (iii) simplification of labor intensive operations to save time and energy for more productive uses; (iv) introduction of useful technology and equipment (e.g. fuel efficient hearths/stoves, etc.); and (v) organization of Women Development Committees for collective management of productive schemes.
18. Sectoral Activities. The functions of the core sectoral departments would function more intensively and their activities would be integrated under the project. They would also collaborate in the project activities and provide technical assistance to VDCs. - 45 - ANNEX III PAKISTAN
NORTHERN RESOURCE MANAGEMENT PROJECT
RURAL ROAD IMPROVEMENT PROGRAMV1
Name of Road District Length (ki)
Bhaunt - Singola Poonch/Bagh 24
Abbaspur - Chrikote - Plangy Poonch/Bagh 24
Alisougal - Kanchikote - Dari Poonch 20
Mujahadabad - Namb - Bareen Poonch 19
Dardrach - Namb - Chachann Poonch 12
Nalian - Kahala - Blooch Poonch 11
Hurnamera - Tari - Chapri Poonch 8
Berigali - Namjar Poonch 8
Atkora - Chachchan Kotli 6
Sarhota - Samror - Dhanna Kotli 21
Mohra Nar - Dubsi Kotli 6
Choch - Khatras Kotli 6
Total 165
1/ This is a tentative list which may undergo some revision when surveys and designs are completed.
GEOMETRIC AND PAVEMENT DESIGN STANDARDS
Formation width: 4.0 m Carriageway width: 3.0 m Maximum gradient: 12.5 % Passing places: minimum 2 per km minimum horizontal radius: 20 m Pipe culverts: 60 cm diameter Sub-base course 15 cm handpacked stones Base course 10 cm broken stones (compacted) Blacktop: 2.5 cm asphalt premix carpet - 46 - ANNEX IV
PAKISTAN
NORTHERN RESOURCE MANAGEMENT PROJECT
ESTIMATED SCHEDULE OF DISBURSEMENTS
Fiscal Year Quarter Ending Projected Cumulative Disbursements(US5'000)
94 March 31, 1994 400 June 30, 1994 1000 95 September 30, 1994 1800 December 31, 1994 2800 March 31, 1995 4000 June 30, 1995 5100 96 September 30, 1995 6200 December 31, 1995 7300 March 31, 1996 8400 June 30, 1996 9500 97 September 30, 1996 10600 December 31, 1996 11800 March 31, 1997 13000 June 30, 1997 14200 98 September 30, 1997 15200 Decenber 31 1997 16600 March 31, 1998 18700 June 30, 1998 21000 99 September 30, 1998 23000 December 31, 1998 25000 March 31, 1999 26400 June 30, 1999 27700 00 September 30, 1999 28800 - 47 - ANNE
PAKISTAN
NORTHERN RESOURCE MANAGEMENT PROJECT
IDA PROJECT SUPERVISION PLAN
Timing Activity Skill Requirements Input (SW)
9/93 Project Launch Mission to Task Manager 4 define and clarify project Privatization implementation Specialist responsibilities
3/94 Supervision mission Agriculturalist 7 (review hiring of Community Involvement consultants, pilot areas, Specialist, Engineer community participation, road improvement and TPs)
11/94 Supervision mission Forester, Livestock 7 (Review pilot schemes, Specialist, community animal health and TPs, specialist community involvement)
Onwards Two supervisions per year 12 as needed
1/96 Mid-Term Review 10
6/99 Project Evaluation 10 ANNEX VI
PAKISTAN
NORTHERN RESOURCE MANAGEMENT PROJECT
PROCUREMENT IMPLEMENTATION SCHEDULE
ESTIMATED ANNUAL CONTRACTUAL AND OTHER PAYMENT (US$ M. equivalent)
Project Year
Procurement Element Responsible Agency - 1 Total Payment Remark 1 2 3 4 5
Civil Works PWD/DOAW/DOAH/DOF/PD&D 1.8 2.3 3.0 3.0 1.9 12.0 LCB
Field Works DOF/DOA/DOAN 1.1 1.5 1.5 1.1 0.5 5.7 Force Account
Vehicles DOA/DOAN 0.4 0.5 0.7 0.3 0.2 2.1 ICB
Equipmnt & Materials DOA/DOAH/PD&D 0.7 0.9 0.9 0.7 0.4 3.6 ICB Local Shopping/LCB
Technical Assistance DOA/DOAH/PD&D 1.0 1.0 1.0 1.0 0.8 4.8 Int'l/Local 0O ______~~~~~shopping
Training & Studies DOA/DOAN/PD&D 0.2 0.2 0.2 0.2 0.1 0.9 Int'l/Local Shopping
Recurrent/Operating Costs DOA/DOAN/DOF/PD&D 1.3 1.3 1.3 1.3 0.8 6.0 Project Management Exp.
Total 6.5 7.7 8.6 7.6 4.8 35.2
IDA Financing 5.6 6.4 7.1 6.1 3.6 (28.8)
* This excludes purchase of land (US$0.4 M) and labor contributed (US$1.4 M) by the community for field works. - 49 -
ANNEX VII PAKISTAN
NORTHERN RESOURCE MANAGEMENT PROJECT
ECONOMIC ANALYSIS
1. Economic analysis was carried out for the forestry, agriculture, road improvement components and whole project. Details of the methodology employed in the economic analysis are as follows:
A. Reforestation Activities
2. For the purpose of the analysis, the economic benefits of the forestry component are derived from re-forestation. To estimate the net benefits of forestry activities, three representative forestry plantations models of 1.0 ha were formulated for fuelwood, coniferous, and fuelwood-cum-pasture respectively. For purpose of the analysis, the total reforested area is estimated at 17,500 ha. About 10,500 ha would be under fuelwood plantations, 2,000 ha under coniferous species and 5,000 ha under fuelwood-cum-pasture plantations.
3. Under fuelwood plantations, broad-leaf species (90%), which are valued by local communities for high quality fuelwood and for fodder production, are to be planted. Broad-leaf species include Robinia psuedoacacia, Ailanthus altissima, Dalbergia sissoo, Albizzia lebbek, Lucaena lucocephala, Morus alba, Eucalyptus camaldulensis, Salix sp. and some locally preferred indigenous species). Coniferous plantations would mainly be Pinus roxburghii (chir pines) as they would continue to be important because of their performance in difficult environments. Pastures would be medicago and clovers.
4. The main quantifiable benefits of forestry activities under the project were the production of fuelwood, timber, and fodder. A rotation period model was used for each specie to estimate the output which also took account of final cut and thinnings. The yields profile were based on actual recent data obtained from the Forestry Department in AJK. The benefits stream was calculated over a thirty-year period. The assumption was made that there are no timber, fuelwood and foliage productions in the 'without' project situation.
B. Roads
5. Roads selected were within and in close proximity to the pilot areas. Specific emphasis was then placed on the population in the villages, the current condition of the roads, the expected vehicle traffic, and the total area under cultivation. In addition to improving these roads to all-weather standard, upgrading would involve the correction of ill planned and poorly constructed roads to reduce environmental degradation. - 50 -
6. The economic analysis employed in this case is based on the "with" and "without" project cases of vehicles using the roads. The benefits are based on the assumption of net savings of road users in vehicle operating costs (reduction in fuel consumption, and general maintenance costs).
7. Average daily traffic (ADT) for each road was obtained by traffic counts of line departments (PWD), and vehicle operating costs for different types of vehicles were obtained from the Pakistan National Traffic Research Center. In addition, based on records of representative roads in the project area of Integrated Hill Farming Development Project and historical growth within the respective districts, the volume of 'normal' traffic was assumed to increase at an annual rate of 5%. For 'generated' traffic growth rate as a result of improved roads, S0W of normal growth was assumed for first two years after completion of roads and an annual increase of 3% thereafter.
8. The annual benefits (net savings on vehicle operating costs) for the 'without' project case was derived as normal growth rate of an ADT for a year times length of road and vehicle operating cost. For 'with' the project case, vehicle operating cost savings was quantified as the net savings on vehicle operating cost of normal traffic plus the additional benefits incurred from generated traffic. However, no benefit was expected to be realized during the five-year construction period.
9. The main cost element is the cost of upgrading the existing surface to all-weather standard. This improvement is assumed to have a 15-year economic life before reconstruction would be required. It is assumed there would be no residual or salvage value to the roads at the end of the 15-year period. As routine and periodic road maintenance are necessary, both annual routine maintenance and resurfacing costs (five year cycle) are incorporated in cost stream after construction of the roads. With such maintenance, vehicle operating costs are estimated to remain constant over the life of the project.
C. Aariculture
10. For the farm income analysis of the project, three representative farm models have been developed. These models are based on three ecological zones based on altitude domains: low (below 750 m), mid (750-1500 m), and high (above 1500 m) altitude domains corresponding to sub-tropical, sub-temperate, and temperate/alpine pasture zones. As the average farm size in the project area is 0.98 ha, these farm models are based on 1.0 ha farm. All three models include income from livestock activities. The "with" project case includes technical packages and treatments and related costs and benefits which are compared with the "without" project situation.
D. Assumption#
11. The underlying assumptions and the treatment of key variables in the derivation of the economic rate of return (ERRs) are as follows:
(a) Prices. All values have been expressed in constant 1992 prices. For internationally traded goods, prices were derived from the latest World Bank commodity price - 51 -
forecast (December 1992), while those for non-traded goods are based on domestic financial prices. All traded commodities and inputs are valued at import parity prices. Appropriate adjustments were made for freight, handling, processing, and quality differentials. Non-traded outputs and inputs were expressed in border rupees through application of a Standard Conversion Factor (SCF) of 0.9. The wage rate of unskilled labor was assumed to be equal to the financial wage rate because of the favorable employment situation in AJK. Fuelwood has been valued on the basis of the presently used alternative source of energy, kerosene.
(b) Proiect life. A project life of thirty years is assumed for forestry, twenty years for agriculture, and fifteen years for road improvement for economic analysis.
(c) Investment costs. After removing price contingencies, taxes and duties, all investment costs have been included in the economic analysis.
Production and Yields
12. Forestry. Of the assumed reforested area of 17,500 ha, about 2,000 ha of demarcated state forest would be planted to coniferous species. About 9,500 ha of community land and 6,000 ha of private land would be planted with mainly broadleaf species (90%) to satisfy farmers' need for fuelwood and fodder. Based on the above and the three representative forestry models, the total production from the project is expected to be 4.5 million m3 of fuelwood, 0.2 million m3 of timber, and 1.5 million tons of forage over the thirty-year period.
13. Acrriculture. The project is expected to increase agricultural production over about 240,775 ha by applying recommended technical packages and treatments for major crops grown in project area. In addition to yield increases in main crops due to improved inputs and extension services, further production would result from a gradual shift from local to improved varieties. Under the present situation, cropping intensities ranges from 80% to 82%, which is low. Under the project, changes in cropping patterns in all three zones are expected. While maize would continue to dominate cropping patterns, some change would occur in the relative importance of crops. In fact, the project would aim at gradual reducing the area under wheat and fallow in favor of green fodder (oats and sadabahar) and apple production.
14. Table 1 below indicates that production of food crops (maize, wheat and apples) would increase from 510,000 to 560,000 tons at full development (Year 5); fodder production on farm would increase from 335,000 to 575,000 tons; and milk production from 390 to 660 million liters. Improved animal feed production would be achieved through improved crop production (mainly maize, sadabahar and oats) by introducing improved crop varieties and legumes into the present cropping cycle. Increased fodder would provide additional animal - 52 -
feed and help the present situation where about 60% of the fodder comes from the hillside grazing.
15. The total 'without' and 'with' the project, and the incremental production from forestry, agriculture and livestock activities for the project area are summarized in Table 1:
Table 1. Proiected Annual Production
Without With Incremental
Forestry (30 year cycle): Fuelwood (Million m3) 4.48 4.48 Timber (Million m 3) - 0.18 0.18 Fodder (Million tons) 1.31 1.53 0.22
Agriculture (Year 5): Food crops (000 tons) 510 560 50 Fodder crops (000 tons) 335 575 240 Milk (Million liter) 390 660 270
Farm Income Analysis
16. The impact of the project on farm incomes is analyzed on the basis of three representative farm models of 1.0 ha. The farm budget analysis indicates that net farm income of participating farmers in the project area will increase substantially at project year 5. Farmers in both mid and high altitude regions will realize higher net farm income than in low altitudes. This is mainly attributable to apple production as they are grown at higher elevations only. In project year 5, the project would generate about Rs 6,600 (average of three different domains) in incremental farm income (in December 1992 prices), which is about 27% increase from the average of Rs 5,200 in the without project case. This includes income from livestock activities, which accounts for more than 60% of total farm income. The increase in farm incomes reflects the high potential productivity of the proposed technical packages and their effect on crop as well as livestock activities. - 53 -
17. The results of farm budget analysis are given in Table 2 below:
Table 2. Prolect Imtact on Farm Net Income (Rs)
Without With (Year 5) Incremental
High domain 6,600 8,300 1,700 26 Mid domain 7,000 8,200 1,200 17 Low domain 2,200 3,300 1,100 50 Average 5,200 6,600 1,400 27
18. Increased agricultural activities would lead to additional employment in the project area. The more intensive land and input use under the project would increase labor requirements, which would provide more year-round activities for presently underemployed farm family members. Employment of women would be also increased. Furthermore, there would be the creation of temporary employment as a result of project road construction, civil works, plantation activities over the five year project period.
Economic Rates of Return
19. The estimated ERRs for the agriculture and reforestation activities are 17W and 16%, respectively. For the proposed twelve roads, the ERR was calculated individually and the range is between 9% and 17%. The overall ERR for road improvement is estimated at 16%.
Table 3. Economic Rates of Return
Reforestation 16% Farm Activities 17% Road Improvement 16% Total Project Activities 13%
20. To evaluate the overall viability of the project, the ERR for the total project was also calculated. Total benefits for the project are based on only three project activities (forestry, agriculture and road improvement). Other benefits were not estimated due to lack of data and difficulty in quantification. Nevertheless, investment costs are taken for all project activities over the project period. The investment cost for these three components accounts for about 82% of the total project cost. Although the project benefits were conservatively valued and significantly under-estimated, - 54 - and the project cost includes all costs, the ERR for the total project was estimated at 13%.
21. Of many unquantified benefits, several environmental and conservation measures have not been incorporated into analysis such as soil conservation, strengthening local management capacity, and reduction in downstream siltation. It is certain, however, that without the project, deterioration of the resource base would continue with adverse effects on overall productivity. The project would improve the living standards of the poor urban and rural communities. Through provision of technical expertise and training the project would enable better policy formulation and decision making on resource management issues.
Sensitivity Analysis
22. To test the sensitivity of project's economic returns to possible adverse outcomes, an analysis of switching values of key variables was carried out. The analysis shows that the ERR for the total project is not sensitive to changes in either costs and benefits. An increase in project costs by 10% with a simultaneous decrease in benefits by 10% would reduce the ERR to only 11%. This is mainly because the project costs are taken for all project activities, while the projected benefits are derived from only three components. In the event that the projected benefits would delay by a year, the ERR would decrease to 11%; a two year delay would reduce the ERR to 10*. In the extreme case of investment costs increasing by 50% and the benefits declining by 30%, the ERR would fall to 9%. Neither of these latter scenarios is likely under the project. - 55 -
ANNEX VIII PAKISTAN
NORTHERNRESOURCE MANAGEMENTPROJECT
ALLOCATION AND DISBURSEMENT OF THE PROPOSED IDA CREDIT
Category US$ million Percent to be financed
(1) Civil works, field works 12.61 80% of expenditures and forestry planting
(2) Foreign and local training, 5.19 100% of expenditures consultancies and studies
(3) Vehicles, equipment and materials 3.84 100% of foreign expenditures; 100% of ex-factory prices of locally manufactured items; 70% of local costs for other items procured locally
(4) Incremental staff and 4.28 100% until an amount operating costs equivalent to SDR 1.7 million; 60% thereafter and until an amount equivalent to SDR 2.8 million; and 30% thereafter.
(5) Unallocated:
Civil works and field works 1.40
Vehicles, equipment and materials 0.42
Technical Assistance, training 0.59 and studies
Operating costs 0.47
Subtotal 2.88
Total 28.80 Pakistan Northern Resource Management Project Project Components by Year
Base Cost (Rs Million) Base Cost (US$ '000) 1994 1995 1996 1997 1998 Total 1994 1995 1996 1997 1998 Total
A. Institutional Restructuring and Support Agricultural Services 34.9 20.6 15.6 11.7 11.5 94.3 1,343.2 793.9 600.9 449.9 440.7 3,628.5 Agriculture Extension & Adaptive Research 7.8 5.3 3.5 2.1 2.1 20.7 299.2 204.4 133.2 79.6 79.6 796.0 Cointnity Forestry & Resource Management 26.0 25.0 29.1 35.6 40.9 156.6 998.8 962.2 1,121.0 1,369.0 1,573.7 6,024.6 Community Awareness £ Education 2.0 0.9 0.6 0.5 0.5 4.4 76.6 34.5 21.8 18.9 17.6 169.4 Policy, planning & Evaluation 42.8 6.8 6.5 6.9 6.4 69.4 1,644.9 260.6 251.3 266.7 247.5 2,671.0 Subtotal Institutional Restructuring and Support 113.4 58.6 55.3 56.8 61.3 345.5 4,362.6 2,255.5 2,128.2 2,184.2 2,359.0 13,289.5
B. Basic Technical Services 62.2 37.3 31.6 25.2 24.9 181.3 2,392.7 1,436.0 1,216.4 970.5 958.5 6,974.1
C. Road Improvement 6.0 46.4 60.9 62.0 44.3 219.6 232.3 1,785.5 2,341.0 2,384.0 1,702.0 8,444.7
D. Pilot Areas 8.6 9.6 10.6 10.5 9.1 48.4 332.6 369.1 409.4 403.5 348.3 1,862.8 1
Total BASELINE COSTS 190.3 152.0 158.5 154.5 139.6 794.9 7,320.2 5,846.1 6,095.0 5,942.1 5,367.8 30,571.2 Cn Physical Contingencies 17.1 15.0 15.9 15.4 13.6 77.0 659.5 577.2 611.5 592.4 522.5 2,963.0 Price Contingencies Inflation Local 7.7 17.0 27.4 37.9 44.4 134.4 296.1 655.0 1,053.1 1,456.2 1,709.4 5,169.7 Foreign 1.6 2.2 3.2 3.8 4.2 15.0 62.0 83.9 122.9 146.0 162.5 577.2 Subtotal Inflation 9.3 19.2 30.6 41.7 48.7 149.4 358.0 738.8 1,176.0 1,602.2 1,871.8 5,746.9
Devaluation 6.7 6.1 7.6 7.8 7.7 35.9 -265.5 -461.2 -680.1 -878.2 -990.9 -3,275.9
Subtotal Price Contingencies 16.0 25.3 38.2 49.4 56.4 185.3 92.5 277.6 496.0 724.0 880.9 2,471.0 Total PROJECT COSTS 223.5 192.3 212.5 219.3 209.5 1,057.2 8,072.1 6,701.0 7,202.4 7,258.5 6,771.2 36,005.2
Taxes 36.1 28.5 33.9 33.5 27.5 159.4 1,304.8 995.1 1,152.3 1,110.5 890.8 5,453.6 Foreign Exchange 84.5 54.2 52.3 44.5 38.8 274.2 3,049.5 1,886.5 1,770.4 1,472.0 1,253.4 9,431.8 Pakistan Northern Resource Management Project Project Cost Sunmary
(Rs Million) (USS '000)
% Total % Total Foreign Base Foreign Base Local Foreign Total Exchange Costs Local Foreign Total Exchange Costs
I. Investment Costs A. Civil Work 200.0 50.0 250.0 20 31 7,693.3 1,923.3 9,616.6 20 31 C. Field works 147.0 - 147.0 - 18 5,653.4 - 5,653.4 - 18 E. Vehicles & motorcycles 23.9 23.9 47.9 50 6 921.0 921.0 1,842.0 50 6 F. Equipment Computers/printers /a 0.4 1.6 2.1 80 - 15.8 63.2 79.0 80 - Imported equipment 3.7 7.6 11.3 68 1 141.2 293.2 434.4 68 1 Locally manufactured equip. 4.9 - 4.9 - 1 187.3 - 187.3 - 1 Office furniture 1.0 - 1.0 - - 38.6 - 38.6 - - Subtotal Equipment 10.0 9.3 19.2 48 2 382.9 356.4 739.3 48 2
G. Land Acquisition 10.5 - 10.5 - 1 402.8 - 402.8 - 1 I. Technical assistance & studies International - 56.4 56.4 100 7 - 2,167.5 2,167.5 100 7 7 Local 24.4 - 24.4 - 3 9jd. - 938.7 - 3 Studies 19.0 - 19.0 - 2 729.2 - 729.2 - 2 Subtotal Technical assistance & studies 43.4 56.4 99.7 57 13 1,668.0 2,167.5 3,835.5 57 13 J. Training & studies Overseas - 19.1 19.1 100 2 - 733.8 733.8 100 2 Local 9.5 - 9.5 - 1 365.2 - 365.2 - 1 Study (local) 0.2 - 0.2 - - 8.8 - 8.8 - - Subtotal raining & studies 9.7 19.1 28.8 66 4 374.0 733.8 1,107.9 66 4
L. Materials and supplies 14.6 13.9 28.6 49 4 562.9 535.2 1,098.1 49 4 Total Investment Costs 459.1 172.6 631.7 27 79 17,658.3 6,637.3 24,295.6 27 79 II. Recurrent Costs A. Incremental staff 66.0 - 66.0 - 8 2,540.4 - 2,540.4 - 8 B. Operations and maintenance Civil works 8.2 2.0 10.2 20 1 314.0 78.5 392.5 20 1 Vehicles 13.1 13.1 26.1 50 3 502.4 502.4 1,004.7 50 3 Subtotal Operations and maintenance 21.2 15.1 36.3 42 5 816.4 580.9 1,397.3 42 5
C. Materials and supplies 22.5 20.7 43.2 48 5 866.4 795.1 1,661.5 48 5 D. Other costs /b 17.6 - 17.6 - 2 676.5 - 676.5 - 2 Total Recurrent Costs 127.4 35.8 163.2 22 21 4,899.6 1,376.0 6,275.6 22 21
Total BASELINE COSTS 586.5 208.3 794.9 26 100 22,558.0 8,013.2 30,571.2 26 100 Physical Contingencies 55.2 21.9 77.0 28 10 2,121.6 841.4 2,963.0 28 10 Price Contingencies 141.3 44.0 185.3 24 23 1,893.8 577.2 2,471.0 23 8 Total PROJECT COSTS 783.0 274.2 1,057.2 26 133 26,573.4 9,431.8 36,005.2 26 118
\a computer, printer, fax machine, and photocopier \b Includes office rent and administrative overhead.
3-1 Project Cost Summary PAKISTAN NORTHERNRESOURCE MANAGEMENT PROJECT Existing Organizationof the Departmentof Agriculture
I secmeary I,
DiectorAgriculture BPS-19
B oE n tt oa m no l oi i st t Ch e mi st A"ge Prgcu r eAenn l. omga U
Itr ators Research Research Research Research Manaers Agrculture Research Panning Ener Research Trani
calcW53349A PAKISTAN NORTHERNRESOURCE MANAGEMENT PROJECT Existing Organization of the Departmentof Animal Husbandry
Secretary
Director
Depur Dkor Dep Dlrector | | Disease InvesLgation Deputy Direcor | | Aninal l | Lhastcek l | a b~~~~~~~~~ffier Pcantry
IADAM ADAHM OH|| OH|| LSO MbZD | POONCH KT tfUR ||A)|
VN) VONH OH) V() LSO
Sup.(H) (H . (H) Offi
K0 ADIO ADIO ADIO mmh MZD POONCH KOTLI MRU
Kay- OR ADA - AssistantDlecbr tAdrinistration ADAH = AssistantDrecr AnimalHu-1randry ADIO - Assnt Dese Investgation Officer LA . Laboatory Assistant LT POP PDO P OPO PDO U'O -kst ock Prbn Otfic MZD MZD POONCH KOTU MIRPUR LSC - Lesock Coordnator LSO UvestockOMOWr LT LaboratoryTocimclan MPF VO(P) |VO(P| VO (P) |VO(P) MPF - ManagerPoitry Fami M I I I III PDO - Poutry Deveopmet Offic POOP - PoNtry Developnt Ofc Producton PO - Phgwfr aIo Sup. (P SUP) (P) Sup. Sup. (P) RO *P seRc Ollcr IIII II1 SA - Stock ASSiWi Sup. (A-1.) = S-prvior (Arta Insemnain)
Sup. (H) Suprvor (HLmi) SA SA SA SA SA 4 Sup. (P) - Supervisor(PoAry) T&PO * Trainn & Pubclty Offic H || A HA VO (H) Vetainary Offier(Health) VO (P) - Vernary Offcer Poultry) VO (R) .Vetrn Offc (Research)
cioWc\W53349C PAKISTAN NORTHERNRESOURCE MANAGEMENT PROJECT Existing Organization of the Forest Department Azad Jammu & Kashmir
| Secretary |
|Chief Conservator|
ReforeFxnchtat|{in sSFo i |stryD.F.O. (H.O.)F.D. Forest Circle ~~Circle Circle(IFAD Muzaffarabad
Sharda Forest KtceForest ForestrCir|a ost Re| Division StaIIstta Division Division ~~~Division NotmValley DivisionJehu Officr
| Kuran| Forest 0 Mirpur Forest PoonchForest Ref. Division l FSouth tReearch 7 Divisionl 7 Division Division R.KOT Muzatfarabad NeelumValley Officer
De|tio< a RResearc h|Demarcation ffarabad Division ~~~~~~~~~~~~~~~~~~~~~DivIsono
Jhelum Valley | Soil Conservation Hilt Fanvning Ref. sion § | LForestDivision Division______Bhmber Re K|8lROTDotivis DivBqh/X0TisionDngerLan| D.F.O0 Ptarnlng Muzaffamabad & Development DemarcationForest SukatterWatershed SoilConservation Muzaf arabad l -|Management Project Engineer I.L.M.Division Sol Conservation Maagn IMuzaffarabad DivisionBhimber
ResinOfficer Mirpur _| ILM yi:ion
_Kashrr Forese Muzaitarabad U S._.forest Muzaffarabad F
~ForestMagistrate Mirpur
Muzaffarabad~ ~~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~~~~~~~Mzffrm I a
Rawalakot
ciW53349E PAKISTAN NORTHERNRESOURCE MANAGEMENT PROJECT ProposedOrganization of the Departmentof Agriculture
F - ~~~~~~~~~Secretary Project ~~~~~~~Social Directorof iiiiiiiiIiIiiiiII Director ~~~~~~~~~~~~~Mobilization Training Ui Director General Agriculture
Director of Extension, Directr o Training & Adaptive Research Research & Technical Services ON
- Agronomist Deputy Director Deputy Director Deputy Director Hort. & Veg. Economic Policy, Planning Training & Extension Deputy Director Specialist & Evaluation Adaptive Muzz, Bagh & Mirpur & - Int. Pest. Man. Research Poonch kotli Specialist - Soil Chemist - Sectoral Policy & * Soil & Water Planning -Project Prep. & Appraisal Conserv./Agric. ApMp&rE DAO DAO Engineer Stastics SMSs AHO AHO AOPP AOPP
Key. ROs AOs AOs AHO = Assistant Horticulture Otficer AO = AgriculturalOfficer AOPP = AgriculturalOfficer Plant Protecbon DAO = DistrictAgricultural Officer FAs FAs FAS = FieldAssistants RO = ResearchOfficer SMS = Subject Matter Specialist
cak\c\W53349B PAKISTAN NORTHERNRESOURCE MANAGEMENT PROJECT Proposed Organization of the Department of Animal Husbandry
Secretary
DirectorGeneral Animal Husbandry
Director of Arimal Director of HealtWNeterlnaryService Uvestock Extension, Resarch & Development
ADAH DI DDEXT DDR&D
VO DLDO,ADAI SROs Breeding Nutrition VETYSUP. ADiO VOR) .Poultry VETYSUP. .VO|
PDO(P),LPO, SA(AI-I) ~~~~~~~~~~~~~~~~~~~~~~~~~~~LSLSO Etc.
Umbrela based on -HospitalsLDPrga CDspeaies SA(DEV) LDC Program - First Aid Center Large StorS -Disease lnvesbgaiton Srna-iSo - Vaccination -Large Stock -Small Stock Key - Small Stock -Pouity ADAH = AssistantDirector Anirmal Health - Pouitry DirectorArificai Inseminaion Al ADIA = Assian . ADIO = Assia Dsase InrvesigabonOffcr DDR&D= DeputyDirector Research & Development DDEXT = DeputyDictor Extension D = DiseaseIrvestigation Otker O 4 ~~~~~~~~~~~~~~~DLDO= Disi LivestockDevebopmer Officr LPO = Lvesiock Producon Officer LS = LvestodcSupervsor LSO = LivestockOfficer PDO(P) PoultryDevelopmentOfflier (Production) SA = StockAssistant SRO = SeniorResearch OMier VO = VetrinaryOffier cakrW53348D PAKISTAN NORTHERNRESOURCE MANAGEMENT PROJECT Proposed Organization of the Forest Department Azad Jammu & Kashmir
Secretary
ChieConservatorI I Social Forestry a | ol FofestsA.K. Wing
Muzaffarabad Mirpur Poonch Reforestation SocialForestry D.F.O.(H O.) FD-. ForestCircle rrce Cicle (IFAD) Muzaarabad
Sharda Kotli ~~~~~~~~~BaghForest R.Dvionsocial FoetyStatistical Divisionq l q Division CDivision5 "i NeelumValley ~ Divislon~~~~~~~~~~~~JehiurnValleyNorh | Officer
PoonchForest Re(.Division SocialForestry Research Dhision Division1 DivisionDhisionurM n ~~~~~~RawalakotDivision Muzallarabad NeelumDivisionValleyOfieSouhcer
Muzaffarabad Demtarcation Deincartion Ref.Division Research DIVI5IO~~~~I Division Division awakfFcorst Divisn Fivts on Mirpur Rawalakot Ra l
Jhetum0 Valley l | SoilConservation | l Ref.Division i Soil a F agistrate DDiviion n himber Kotli Conservation - NPRMP i Fl Bagh Forest I M fab . I Circle I |DemarcatonForestl SukatterWatershed Divis---nion j I MuDavision ManagementProject Muzafarabad L
NPRMPa Kaslunir Forest I L M Division aI: ~~~~~~~~~~~~Forest Diviso si WatS orestPla Rei|ffc I.L.M.Division Foes DivisionS: i
Schod_|_1 Kotli j a (South) F PMuzartaiabado
UliZzation | | ~~~~~~~~~RangelandDivislon |8S.1. Utilzaion |Muzallarabad | Mh rpur u| Prosecution .eCenter Si. Frs _Section Cenlr Rangeead MuzaWarabad Rawalo
cafctW53349F PAKISTAN NORTHERNRESOURCE MANAGEMENT PROJECT ProposedOrganization of the Planningand DevelopmentDepartment
Additional Chief Secretary (Development) I Pnvatization and Director L Reorganization Unit General Und AseEn ment (Temporary)TUntAssm t
Agricufture Education Health Technical Eoonomic and Industry Services Affairs
cl kc\534 0
cakfic\W53349G MAP SECTION
IBRD24703
4573 m 74' A 2875 kon, b- ...... cldb, Tkl;hW,0ld13
A 6281 m.s 4~~~~~~~~~~4 '6 -35-* 29 &.4 -dtn
^ t ^3zl ~~.01,.
ooo1s s A P A K I S T A | ejf NORTHERN RESOURCE~~~~~~~~495
\~~~~44 m- 26.MNGMN RJC
I~~~~~12 A'(.'uQF -'I95
t~~~~~22 MANAEMEN P<,-DSROJCTBUDRE .*t \ s. ~~~"AB G H"
zI RaWalkOA191 M.>
201M,t 182 m - KIOMTESWNIIS SEECE
A . Aprxmt A I3IIELEVTESN (mtes I~~~~~~~~~~~Ln of STATE BOUNDA",,
<,,,,>~ ~ Z oContro' .11
UM; N5° ", AFHA I TN, _ II \ r IsLAMAs+DX,L~~~~~~ILE t PI tJR R ' * 33~~ 25 ~ ~~~~j0 Aprsr175
74-~~~~~~~~~~~~~~~~~~~~. ,. .{ IKISTNTAIKI~ANRL19