The World Bank

Document of The World Bank

Public Disclosure Authorized Report No: ICR3160

IMPLEMENTATION COMPLETION AND RESULTS REPORT (IDA-H1790 IDA-H5760)

ON A

GRANT

IN THE AMOUNT OF SDR 8.7 MILLION Public Disclosure Authorized (US$13.0 MILLION EQUIVALENT)

AND

AN ADDITIONAL FINANCING

IN THE AMOUNT OF SDR6.6 MILLION (US$10.0 MILLION EQUIVALENT)

TO THE

Public Disclosure Authorized REPUBLIC OF TAJIKISTAN

FOR A

FERGHANA VALLEY WATER RESOURCES MANAGEMENT PROJECT

November 27, 2014

Public Disclosure Authorized Global Water Practice Central Asia Country Unit Europe and Central Asia Region

CURRENCY EQUIVALENTS

(Exchange Rate Effective September 23, 2014)

Currency Unit = Somoni US$ 1.00 = 4.99 Tajikistan Somoni (TJS)

FISCAL YEAR January 1 – December 31

ABBREVIATIONS AND ACRONYMS

AF Additional Financing MMWRM Ministry of Melioration and Water AKF Agha Khan Foundation Resources Management BP Bank Procedures MOA Ministry of Agriculture BFC Big Ferghana Canal MOE Ministry of Energy CAS Country Assistance Strategy MSDSP Mountain Societies Development CSF Collective and State Farm Support Program CPSC Central Project Steering NBFO Non-Bank Financial Organization Committee NFC North Ferghana Canal EA Environmental Assessment NGO Non-Governmental Organization EMP Environmental Management Plan NPV Net Present Value EMMP Environmental Management and OD Operational Directive Monitoring Plan OP Operational Policy ERR Economic Rate of Return O&M Operation and Maintenance EWS Early Warning System PAMP II Second Public Employment for FIAS Farm Information and Advisory Sustainable Agriculture and Water Service Resources Management Project FPSP Farm Privatization Support Project PDO Project Development Objective FTC Farmer Training Center PRSP Poverty Reduction Support Program FVWRMP Ferghana Valley Water Resources RIRP Rural Infrastructure Rehabilitation Management Project Project GDP Gross Domestic Product RLRO Regional Land Registry Office GEF Global Environment Facility RPEC Regional Project Executive Committee GoT Government of the Republic of PIU Project Implementation Unit Tajikistan PMU Project Management Unit Ha Hectare SCEPF State Committee for Environmental IPM Integrated Pest Management Protection and Forestry I&D Irrigation and Drainage SCNP State Committee for Nature Protection IRR Internal rate of return SLC State Land Committee ISF Irrigation Service Fee SLSC State Level Steering Committee KCC Kannibodom Concrete Canal SOSWRMD Soghd Oblast State Water Resources KKK Kavsari Kandi Kuhan Management Department KPI Key Performance Indicators TOR Terms of Reference KSWMD Kannibodom State Water WUA Water User Association Management Department SECO/ Swiss State Secretariat for Economic LRCSP Land Registration Cadastre SDCRSA Affairs / Swiss Agency for System for Agriculture Project Development and Cooperation Rapid LDPSC Leninabad Department Power Social Assessment

Supply Company USAID United States Agency for International M&E Monitoring and Evaluation Development

Vice President: Laura Tuck Country Director: Saroj Kumar Jha Practice Manager: Dina Umali-Deininger Project Team Leader: IJsbrand H. de Jong ICR Author: Malathi S. Jayawickrama

TAJIKISTAN FERGHANA VALLEY WATER RESOURCES MANAGEMENT PROJECT

CONTENTS

ICR Data Sheet A. Basic Information B. Key Dates C. Ratings Summary D. Sector and Theme Codes E. Bank Staff F. Results Framework Analysis G. Ratings of Project Performance in ISRs H. Restructuring I. Disbursement Graph

1. Project Context, Development Objectives and Design ...... 1 2. Key Factors Affecting Implementation and Outcomes ...... 5 3. Assessment of Outcomes ...... 11

4. Assessment of Risk to Development Outcome ...... 23 5. Assessment of Bank and Borrower Performance ...... 24 6. Lessons Learned ...... 26 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners ...... 27 Annex 1. Project Costs and Financing ...... 28 Annex 2. Outputs by Component ...... 29 Annex 3. Economic and Financial Analysis ...... 41 Annex 4. Bank Lending and Implementation Support/Supervision Processes ...... 54 Annex 5. Beneficiary Survey Results ...... 56 Annex 6. Stakeholder Workshop Report and Results ...... 58 Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR ...... 59 Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders ...... 63 Annex 9. List of Supporting Documents ...... 64 MAP

ICR DATA SHEET Tajikistan FERGHANA VALLEY WATER RESOURCES MANAGEMENT PROJECT (P084035) IMPLEMENTATION COMPLETION REPORT

. GWADR

A. Basic Information

Ferghana Valley Water Resources Country: Tajikistan Project Name: Management Project Project ID: P084035 L/C/TF Number(s): IDA-H1790, IDA-H5760 ICR Date: 11/05/2014 ICR Type: Core ICR Lending Instrument: SIL Borrower: REPUBLIC OF TAJIKISTAN Original Total XDR 8.70M Disbursed Amount: XDR 15.23M Commitment: Revised Amount: XDR 15.30M Environmental Category: B Implementing Agencies: Ministry of Melioration and Water Resources Management Cofinanciers and Other External Partners:

B. Key Dates Revised / Actual Process Date Process Original Date Date(s) Concept Review: 03/16/2004 Effectiveness: 01/19/2006 01/19/2006 02/15/2010 Appraisal: 03/16/2005 Restructuring(s): 05/25/2010 05/15/2013 Approval: 07/26/2005 Mid-term Review: Closing: 05/31/2011 05/31/2014

C. Ratings Summary C.1 Performance Rating by ICR Outcomes: Moderately Unsatisfactory Risk to Development Outcome: Moderate Bank Performance: Moderately Unsatisfactory Borrower Performance: Moderately Unsatisfactory

C.2 Detailed Ratings of Bank and Borrower Performance (by ICR) Bank Ratings Borrower Ratings Moderately Quality at Entry: Unsatisfactory Government: Unsatisfactory Implementing Moderately Quality of Supervision: Moderately Satisfactory Agency/Agencies: Unsatisfactory Overall Bank Moderately Overall Borrower Moderately Performance: Unsatisfactory Performance: Unsatisfactory

C.3 Quality at Entry and Implementation Performance Indicators Implementation Indicators QAG Assessments (if any) Rating Performance Potential Problem Project No Quality at Entry (QEA): None at any time (Yes/No): Problem Project at any Yes Quality of Supervision (QSA): None time (Yes/No): DO rating before Moderately Satisfactory Closing/Inactive status:

D. Sector and Theme Codes Original Actual Sector Code (as % of total Bank financing) Agricultural extension and research 2 2 Crops 2 2 General public administration sector 10 10 General water, sanitation and flood protection sector 20 20 Irrigation and drainage 66 66

Theme Code (as % of total Bank financing) Environmental policies and institutions 17 17 Land administration and management 16 16 Participation and civic engagement 17 17 Rural policies and institutions 17 17 Water resource management 33 33

E. Bank Staff Positions At ICR At Approval Vice President: Laura Tuck Shigeo Katsu Country Director: Saroj Kumar Jha Dennis N. de Tray Practice Manager/Manager: Dina Umali-Deininger Joseph R. Goldberg

Project Team Leader: IJsbrand Harko de Jong Usaid I. El-Hanbali ICR Team Leader: IJsbrand Harko de Jong ICR Primary Author: Malathi S. Jayawickrama

F. Results Framework Analysis

Project Development Objectives (from Project Appraisal Document) The project objectives are (i) to improve the capacity for increased productivity of irrigated agriculture in the Ferghana Valley by improving land and water management, and (ii) to improve safety and regulation of the Kayrakkum Dam and Reservoir, thereby contributing to enhanced water management security and efficiency at the basin level.

Revised Project Development Objectives (as approved by original approving authority) The revised PDO is to assist the Recipient in: (i) increasing the coverage of drained and irrigated areas in Bobojon Gafurov and Kannibodom raions, respectively; and (ii) strengthening the early warning system of the Kayrakkum dam as well as carrying out a geotechnical study for assessing the risks associated with said dam.

(a) PDO Indicator(s)

Original Target Formally Actual Value Values (from Revised Achieved at Indicator Baseline Value approval Target Completion or documents) Values Target Years Reduction of flooded and waterlogged land areas within project perimeters near Indicator 1 : levees Reduce by 70% the 5,000 Value ha of heavily waterlogged quantitative or Target of 3,500 ha 3,530 ha land areas within project Qualitative) parameter Date achieved 11/15/2005 05/31/2011 05/31/2014 Comments (incl. % 100.8% achievement of original target. achievement) Indicator 2 : Area returned to effective irrigation under the project Value Not Available (new 6,450 ha (at quantitative or indicator at Additional Additional 7,349 ha Qualitative) Financing/Restructuring) Financing) Date achieved 11/15/2005 05/25/2010 05/31/2014 Comments (incl. % 113.9% achievement of the target. achievement) Indicator 3 : Collection of billed water fees by WUAs Value New Indicator at 80% (at quantitative or 30% Additional Additional 86% Qualitative) Financing Financing)

Date achieved 11/15/2005 05/25/2010 05/31/2014 Comments (incl. % 107.5% of achievement of the target. achievement) Indicator 4 : Early warning system established/improved and tested Value New Indicator at quantitative or 0 Additional 100% 100% Qualitative) Financing Date achieved 11/15/2005 05/25/2010 05/31/2014 Comments (incl. % 100% achievement of the target. achievement) Detailed dam geotechnical study completed and an executive summary with all Indicator 5 : the main recommendations prepared to be shared regionally Value New Indicator at Study fully Study not quantitative or 0 Additional completed as conducted Qualitative) Financing stated in PDO Date achieved 11/15/2005 05/25/2010 05/31/2014 Comments Not achieved. The project made arrangements that this study would be funded (incl. % and executed by EBRD. achievement) Forecast accuracy for available reservoir storage volumes and inflow/outflow Indicator 6 : volumes improved Value New Indicator at 6 (at quantitative or 0 Additional Additional 6 Qualitative) Financing Financing) Date achieved 11/15/2005 05/25/2010 05/31/2014 Comments (incl. % 100% achievement of target achievement)

(b) Intermediate Outcome Indicator(s)

Original Target Actual Value Formally Values (from Achieved at Indicator Baseline Value Revised approval Completion or Target Values documents) Target Years Indicator 1 : Lengths of main irrigation BFC canals repaired/lined (km) Value (quantitative 6.4 (At AF appraisal) 29 11 11.36 or Qualitative) Date achieved 05/25/2010 11/15/2005 05/25/2010 05/31/2014 Comments (incl. % 103.2% achieved. achievement) Indicator 2 : BFC irrigation structures rehabilitated (no.) Value 150 (At AF appraisal) 160 161 (quantitative

or Qualitative) Date achieved 05/25/2010 05/25/2010 05/31/2014 Comments (incl. % 100.6 % achieved achievement) Indicator 3 : Lengths of main and secondary drains rehabilitated (km) Value (quantitative 62 (At AF appraisal) 415 120 117.6 or Qualitative) Date achieved 05/25/2010 11/15/2005 05/25/2010 05/31/2014 Comments (incl. % 98% achieved achievement) Indicator 4 : I&D pumping station systems rehabilitated (no.) Value (quantitative 4 (At AF appraisal) 16 9 10 or Qualitative) Date achieved 05/25/2010 11/15/2005 05/25/2010 Comments (incl. % 111.1% achieved achievement) Indicator 5 : I&D tube-wells rehabilitated and renovated (no.) Value (quantitative 38 (At AF appraisal) 200 118 110 or Qualitative) Date achieved 05/25/2010 11/15/2005 05/25/2010 05/31/2014 Comments (incl. % 93.2% achieved achievement) Indicator 6 : Observation wells rehabilitated and renovated (no.) Value (quantitative 75 (At AF appraisal) 95 97 or Qualitative) Date achieved 05/25/2010 05/25/2010 05/31/2014 Comments (incl. % 102.1% achieved achievement) Indicator 7 : Area with improved inter-farm and on-farm I&D systems (ha) Value (quantitative 800 (At AF appraisal) 4000 4800 4800 or Qualitative) Date achieved 05/25/2010 11/15/2005 05/25/2010 05/31/2014 Comments (incl. % 100% achieved achievement) Indicator 8 : Lengths of reservoir side embankments rehabilitated (km) Value 3.2 (At AF appraisal) 38 10.2 9.14 (quantitative

or Qualitative) Date achieved 05/25/2010 11/15/2005 05/25/2010 05/31/2014 Comments (incl. % 89.6% achieved achievement) Urgent dam safety measures defined and taken, reservoir volumes determined, Indicator 9 : and inflow/outflow gauging systems installed and operational Value (quantitative 80% (At AF appraisal) 100% 100% 100% or Qualitative) Date achieved 05/25/2010 11/15/2005 05/25/2010 05/31/2014 Comments (incl. % 100% achieved achievement) Indicator 10 : Geo-technical investigation completed (action plan) None (At AF appraisal, Value the draft geotechnical (quantitative 100% complete Not achieved investigation reports were or Qualitative) available) Date achieved 05/25/2010 05/25/2010 05/31/2014 Comments (incl. % To be completed under an EBRD project. achievement) Indicator 11 : Early Warning System operational (Completed) Value (quantitative 75% (At AF appraisal) 100% 100% or Qualitative) Date achieved 05/25/2010 05/25/2010 05/31/2014 Comments (incl. % 100% achieved achievement) Yearly reservoir storage and flow assessments and real-time application of Indicator 12 : measurements in reservoir operations (twice yearly reports) Value (quantitative 4 (At AF appraisal) 4 6 6 or Qualitative) Date achieved 05/25/2010 11/15/2005 05/25/2010 05/31/2014 Comments (incl. % 100% achieved achievement) Indicator 13 : Demonstrations held (No.) and new cultivation or cropping technologies adopted Value (quantitative 4 (At AF appraisal) 10 40 49 or Qualitative) Date achieved 05/25/2010 11/15/2005 05/25/2010 05/31/2014 Comments (incl. % 122.5% achieved achievement)

Indicator 14 : Routine soil/water sample reports (No.) Value (quantitative 5 (At AF appraisal) 5 7 7 or Qualitative) Date achieved 05/25/2010 11/15/2005 05/25/2010 05/31/2014 Comments (incl. % 140% achieved achievement)

G. Ratings of Project Performance in ISRs

Actual Date ISR No. DO IP Disbursements Archived (USD millions) 1 01/11/2006 Satisfactory Satisfactory 0.00 2 05/08/2006 Satisfactory Satisfactory 0.20 Moderately 3 11/09/2006 Satisfactory 0.32 Unsatisfactory 4 12/30/2006 Satisfactory Moderately Satisfactory 0.38 5 07/26/2007 Satisfactory Moderately Satisfactory 0.85 6 05/30/2008 Satisfactory Moderately Satisfactory 2.52 7 03/06/2009 Satisfactory Satisfactory 5.38 8 08/17/2009 Moderately Satisfactory Moderately Satisfactory 7.53 9 12/30/2009 Satisfactory Satisfactory 9.50 10 10/17/2010 Satisfactory Satisfactory 11.00 11 04/20/2011 Satisfactory Satisfactory 11.54 12 12/03/2011 Satisfactory Moderately Satisfactory 13.18 Moderately Moderately 13 06/22/2012 15.56 Unsatisfactory Unsatisfactory Moderately Moderately 14 03/23/2013 19.23 Unsatisfactory Unsatisfactory Moderately Moderately 15 10/13/2013 22.12 Unsatisfactory Unsatisfactory 16 12/28/2013 Moderately Satisfactory Moderately Satisfactory 22.99

H. Restructuring (if any)

ISR Ratings at Amount Board Restructuring Disbursed at Restructuring Reason for Restructuring & Approved Restructuring Date(s) Key Changes Made PDO Change DO IP in USD millions To reallocate grant proceeds 02/15/2010 S S 10.03 and include 100% financing. To include Additional 05/25/2010 Y S S 10.43 Financing, revise Results

ISR Ratings at Amount Board Restructuring Disbursed at Restructuring Reason for Restructuring & Approved Restructuring Date(s) Key Changes Made PDO Change DO IP in USD millions Framework and extend closing date by two years to May 31, 2013. To extend closing date by one 05/15/2013 MU MU 20.10 year to May 31, 2014.

If PDO and/or Key Outcome Targets were formally revised (approved by the original approving body) enter ratings below: Outcome Ratings Against Original PDO/Targets Moderately Unsatisfactory Against Formally Revised PDO/Targets Moderately Satisfactory Overall (weighted) rating Moderately Unsatisfactory

I. Disbursement Profile

1. Project Context, Development Objectives and Design

1.1 Context at Appraisal

1. Independence and turmoil, followed by a bloody civil war in the 1990s had left Tajikistan among the poorest countries in the world. Although real annual GDP growth had ranged from 6 to 8 percent over several years, in 2004, annual per capita income was US$300, with about 64 percent of the population of 6.3 million remaining below the poverty line. Agriculture was critical to Tajikistan’s poverty reduction and economic growth. It provided the main livelihood for two thirds of the population, and represented a fifth of the economic output. Of Tajikistan’s 4.6 million hectares (ha) of agricultural land, only about 780,000 ha were arable and irrigated. Of this, roughly 500,000 ha were under rotation between cotton and cereal crops, with about 290,000 ha under cotton at any one time.

2. The Ferghana Valley (FV) was an important region of Central Asia, with a total population of approximately 11 million, of whom 70 percent lived in rural areas spread among Uzbekistan, the Kyrgyz Republic and Tajikistan. The Valley had the most fertile soils and highest population density of any region in Tajikistan. It was rich in water resources, including groundwater. Its principal water control feature was the Kayrakkum Dam Reservoir, located on the Syr Darya River. The dam was built in 1959, and the reservoir was used for seasonal regulation of the river flow to provide water for irrigation and power generation. Although the reservoir’s water mainly benefitted Uzbekistan, the dam itself was located in the territory of Tajikistan. Since the collapse of the Soviet Union, the irrigation and drainage (I&D) systems had fallen into disrepair, leading to unreliable irrigation water supplies, drainage and water-logging problems, and reductions in irrigated area, soil fertility, cropping intensity and crop yields.

3. The reduction in irrigated area affected the livelihoods of an estimated 2 million people in Tajikistan’s share of FV, reducing agricultural income and increasing the incidence of poverty. Tajikistan’s territory in FV covered approximately 700,000 ha of which about 220,000 ha were suitable for irrigation, while the actual irrigated area in 2002 was only 134,000 ha, due to deteriorating irrigation infrastructure and weak water management. Other factors that affected water management in FV included cross-border water management problems, inefficient water use practices, farm land ownership, and conflicts in water use priorities.

4. At the time of appraisal, Tajikistan was still in a post-conflict state, and the Bank was keen to support the country in view of its rapidly increasing poverty levels, especially in the rural areas. The country’s institutions and overall capacity were also quite weak, for example, with low or no technical strength in several ministries. The Government was keen to reduce poverty; however, there were only limited resources available to address the multitude of issues and priorities the country faced. One of these

issues related to incomplete and controversial farm restructuring and land privatization, which were being addressed under a separate project1.

5. The Government of the Republic of Tajikistan’s (GoT) strategy to reduce poverty and improve water management considered FV as one of the main areas to be developed, and stressed the need to increase the contribution of water users to enhance sustainability of irrigation systems. The Bank had gained valuable experience from on-going operations in the agriculture sector, especially the Rural Infrastructure Rehabilitation Project2 and the Farm Privatization Support Project (see footnote 1). In addition, the Land Registration and Cadastre System for Sustainable Agriculture Project (LRCSP) had just been approved in April 2005 to support farm land privatization. The Ferghana Valley Water Resources Management Project (FVWRMP) was to be linked to LRCSP to enhance the benefits of privatization with the concurrent rehabilitation of basic rural irrigation infrastructure, and to introduce water users associations (WUAs), which were nonexistent, and there was no recovery of operations and maintenance (O&M) costs from farmers. FVWRMP was to focus on the Soghd Oblast of Tajikistan and the westernmost portion of FV.

6. FVWRMP was viewed as important from a regional standpoint. The Project aimed to achieve national benefits by rehabilitating local I&D systems and improving water management, while simultaneously reestablishing the safety and better operations of Kayrakkum Dam and Reservoir, thereby benefiting downstream countries as well as Tajikistan. FVWRMP was approved on July 26, 2005 for an amount of US$13 million equivalent and became effective on January 19, 2006.

1.2 Original Project Development Objectives (PDO) and Key Indicators

7. The PDO was: (i) to improve the capacity for increased irrigated agriculture productivity in the Ferghana Valley by improving land and water management, and (ii) to improve safety and regulation of the Kayrakkum Dam and Reservoir, thereby contributing to enhanced water management security and efficiency at the basin level.

8. The Key Performance Indicators (KPIs) were: (i) 70% reduction of flooded and waterlogged land areas within project perimeters near levees; (ii) 30% improvement in timely water availability in irrigated areas under project; (iii) WUA established and functioning adequately in Western Kannibodom; (iv) 80% collection of billed water fees from WUAs established for more than a year under the project, for O&M of I&D gravity and pumping systems, particularly tubewell systems; (v) 10% minimum increase in crop yields; (vi) dam safety management and emergency action plan in place; and (vii) forecast accuracy for available reservoir storage volumes and inflow/outflow volumes improved to 70% accuracy level.

1 The Farm Privatization Support Project approved on June 10, 1999 in the amount of SDR 14.8 million and Additional Financing for the project approved on February 22, 2001 in the amount of SDR 2.4 million 2 Approved on June 22, 2000 in the amount of SDR 14.9 million

1.3 Revised PDO and Key Indicators, and reasons/justification

9. The project suffered from cost overruns in the first three years of implementation due to ‘under-design’ during project preparation and significant price increases on most goods and works, as detailed in Section 2. At the Mid-Term Review (MTR) on May 18, 2009, it was believed that project outputs were falling considerably short of original design and threatening achievement of the PDO. The shortfall was due to a number of factors, mainly the higher cost. In response to funding constraints in some disbursement categories, FVWRMP was restructured (Level Two) on February 15, 2010, to reallocate grant proceeds to enable works to continue until planned additional financing (AF) was mobilized. 3 The restructuring also included an increase to 100 percent financing to alleviate the burden of counterpart financing from Tajikistan’s constrained budget. Subsequently, the project needed another restructuring to address changes in project scope/outputs. Following discussions with ECA Quality, it was decided to process these changes together with the additional financing (AF).

10. On May 25, 2010, the project underwent a second restructuring (Level One) to include AF of SDR 6.6 million (US$10 million equivalent) to help finance the cost overrun, complete additional works identified in detailed designs during implementation, and to expand activities to increase the capacity of Raivodkhozes (district Water Departments) and WUAs. The restructuring included: a revision to the PDO and the Results Framework (RF); and a two-year extension of the Closing Date to May 31, 2013.

11. A key element of the AF was to further understand the safety risk of the Kayrakkum Dam. The review of the Dam had been inconclusive in determining the ultimate risk posed by the Dam, especially under earthquake conditions. The consultant’s draft report had proposed a number of studies and plans that needed to be implemented over time, as resources (beyond that available under the Project) became available. As a result, the AF allocated US$250,000 for a detailed geotechnical investigation to determine the risk level, and, also included a number of measures4 to improve dam safety, amounting to a total cost of US$410,000.

12. The revised PDO was to assist the Recipient in: (i) increasing the coverage of drained and irrigated areas in Bobojon Gafurov and Kannibodom raions, respectively; and (ii) strengthening the early warning system of the Kayrakkum Dam as well as carrying out a geotechnical study for assessing the risks associated with said dam.

13. The revised KPIs were as follows: (i) reduction of flooded and waterlogged land areas within project perimeters near levees; (ii) area returned to effective irrigation under the project; (iii) collection of billed water fees by WUAs; (iv) early warning system

3 On January 29, 2009, the Government had requested additional financing of US$10 million from IDA to cover the cost overrun. 4 Completion of a reliable early warning system for downstream population in the event of an emergency supported by an efficient organization and communication systems

established/improved and tested; (v) detailed dam geotechnical study completed and an executive summary with all the main recommendations prepared to be shared regionally; and (vi) forecast accuracy for available reservoir storage volumes and inflow/outflow volumes improved5.

1.4 Main Beneficiaries

14. Project interventions focused on an irrigated area of 30,000 ha, and were expected to benefit approximately 250,000 people located in areas south of the Kayrakkum Reservoir, in Kannibodom and Bobojon Gafurov raions, by reducing flooding of large tracts of farm land and villages alongside the Southern embankments of the reservoir. Expected benefits also included improved living conditions and reduced exposure to waterborne diseases. Other beneficiaries included WUAs created and supported by the project.

1.5 Original Components

15. Component 1. Irrigation and Drainage Systems Rehabilitation and Improvements (US$9.02 million). This component financed design and works for rehabilitating pumped and gravity I&D systems serving 30,000 ha of farm land in the Kannibodom and Bobojon Gufarov raions, including: (i) reforming and cleaning main and secondary off-farm collector drains, and rehabilitating associated drainage pumping stations; (ii) renovating I&D tubewell systems; (iii) rehabilitating selected major irrigation pumping station systems; (iv) repairing and lining selected sections of the Big Ferghana Canal (BFC); and (v) improving selected inter-farm and on-farm surface and subsurface I&D systems.

16. Component 2. Strengthening Kayrakkum Reservoir Dykes and Improvement of Kayrakkum Dam Safety and Reservoir Operation (US$3.03 million). This component funded: (i) design and works related to the rehabilitation of the Kayrakkum Reservoir dykes in Kannibodom and Bobojon Gafurov raions; and (ii) technical studies, dredging and other equipment and instrumentations, and minor works to increase operational performance and improve management of the Kayrakkum Dam and Reservoir, to improve dam safety and develop dam and reservoir emergency procedures.

17. Component 3. Institutional Development and Technical Assistance (US$1.37 million). This component covered the necessary institutional capacity building for: (i) establishing WUAs; (ii) improving agricultural productivity and achieving more efficient water use patterns; and (iii) ensuring proper environmental impact mitigating measures. Activities included training, demonstration programs, and information dissemination exercises and technical assistance (TA) from international and local specialists.

5 Revised Results Framework, Project Paper, page 8

18. Component 4. Project Management (US$0.75 million). This component funded assistance to the central Project Management Unit (PMU) and to the regional Project Implementation Unit (PIU), and included: (i) establishing and supporting a PMU in Dushanbe within the Ministry of Melioration and Water Resources Management (MMWRM), and of a PIU in Khujand; (ii) local and international TA for managerial, technical, financial, procurement and administrative supervision of implementation activities; (iii) setup and operation of a project monitoring and evaluation (M&E) system; and (iv) an institutional strengthening program incorporating relevant training.

1.6 Revised Components. The components were not revised.

1.7 Other significant changes

19. Project activities remained fundamentally the same as in the original project. Under the AF, the project also planned to establish and support two additional WUAs, and finance the in-depth geotechnical study. Allocations to Components 1 to 4 were increased respectively by US$5.9, 3.0, 0.8 and 0.3 million.

20. On March 15, 2013, FVWRMP underwent a third restructuring (Level Two) to extend the closing date by one year to May 31, 2014. This restructuring required approval of the Regional Vice President due to the cumulative extension of three years from the original closing date. The main rationale was to allow sufficient time to complete remaining project activities (i.e. construction works and capacity building of WUAs) that had been delayed. Consultant services to prepare studies for a successor project were also added to Component 4. Implementation Progress (IP) and progress towards achievement of the PDO were both rated moderately unsatisfactory (MU) at the time.

2. Key Factors Affecting Implementation and Outcomes

2.1 Project Preparation, Design and Quality at Entry

21. Project concept and design drew on Bank experiences and lessons from similar projects implemented in former Soviet countries and globally. These included: (i) the need for an inclusive approach that covered both physical and non- physical improvements to the irrigated agriculture sector and addressed social, institutional, environmental and financial aspects as well; (ii) the need to address both irrigation (pumping capacity) problems and drainage problems; (iii) the importance of tackling power system deficiencies (by including rehabilitation of electromechanical installations) as I&D systems are heavily dependent on power; and (iv) the need to develop WUAs with system users who are owners or long-term tenants of the lands being serviced.

22. The Bank decided to fast-track project preparation despite the limited availability of data to ensure high-quality preparation. At the time, it was felt that Tajikistan needed urgent assistance in view of the fragility of the post-conflict situation

and the increasing poverty levels, and that a rapidly-prepared project to support poverty reduction was the most appropriate tool. Although there were possible risks involved, Bank management made a decision to move head at the time, and believed that any deficiencies during preparation could be addressed during implementation.

23. The design failed to properly address some of the key issues/risks that were identified during preparation.6 These include: (i) the inadequacy of a single operation to address the complex water management aspects in FV, compared to a more modest approach/phased longer-term program of an Adaptable Program Loan (APL) or some piloting. The project included a package of infrastructure, participation, capacity building, extension services and environmental mitigation in a country where local capacity (GoT and private sector) was either very limited or non-existent (Aide Memoire, May/June 2009, p.3); (ii) the long time it takes to implement effective privatization schemes and thereafter set up functional WUAs. WUA development was highly dependent on land privatization, and FVWRMP needed to harmonize the timing with LRCSP. Although the project identified the risk of delays in LRCSP, it did not identify alternative actions in case of possible delays; and (iii) previous experience that indicated the high risk in terms of sustainability of WUAs, with WUAs seldom able to recover even operations and maintenance (O&M) costs in similar situations. While the Project provided some office resources, it lacked support to strengthen management and low institutional capacity of WUAs. Only at the AF stage did the project address the institutional capacity of the Raidvodhozes that were working with the WUAs to maintain project investments.

24. The Project’s design was over-ambitious in terms of expecting to achieve a complex agenda, given the resources that were made available, and in a country with poor institutional capacity. The PDO was also unrealistic in stating that FVWRMP would ‘improve safety and regulation of the Kayrakkum Dam and Reservoir’. Improving the safety of the dam, where the reliability and stability of the structures were unknown, would have involved more in-depth investigations and costs. GoT also did not attach as much importance to investing the time and resources into the dam, given the number of other priorities the country faced, and the fact that GoT believed that the Kayrakkum Reservoir was only of interest to Uzbekistan as its water mainly benefitted Uzbekistan.

25. The Project suffered from cost overruns partly due to ‘under design’ at preparation, resulting in delayed implementation, significantly reduced outputs than envisaged, and necessitating several restructurings. Most quantities and cost estimates for works and services were underestimated in 2004, as they were based on unit costs provided by the government and over-reliance on Soviet-based cost estimates. In some cases, the original designs did not include several key elements (AF Project Paper, p. 2). For example, the original design did not identify numerous structures that needed rehabilitation, including the structures on the main irrigation canal that would need to be

6 Project Concept Note (CN) Review and at the Quality Enhancement Review (QER) Minutes (CN Review, April 4, 2004, and QER, February 24, 2005). Information is also from email exchanges and interviews with the Task Team Leader at preparation.

repaired following canal’s rehabilitation. This necessitated several changes to the FVWRMP’s design during implementation. Similarly, the design did not include the structures needed to ensure sustainable land management for crop production. The original reservoir embankments were under-designed, and required substantial yearly budget allocations for their maintenance. Significant price increases of most works, goods and labor during 2007-2010 also contributed to cost overruns and the need for AF. These factors combined to delay implementation and reduce the project’s reach in terms of outputs.7

2.2 Implementation

26. The Project got off to a slow start and activities fell behind from the beginning. Several factors contributed to this: (i) the Dam Safety Panel, which was to be created by January 1, 2006, was delayed until January 2007 due to delays in project preparation and in declaring the Grant Agreement effective; (ii) the transfer of the PMU Director and the time taken for the new Director (appointed in June 2006) to implement project activities and to appoint PMU staff contributed to very little progress in the first ten months after effectiveness on January 19, 2006. By November 2006, it was clear that the first year targets for project activities would not be met, and IP was downgraded to MU. The Bank and PMU agreed on an action plan. As most activities progressed, the rating was upgraded to MS within a month. However, the project continued to face delays in 2007.

27. Cost overruns affected implementation, reduced outputs, and necessitated additional financing. Other factors that contributed to higher than anticipated costs included: a sizable rise in construction costs (labor, fuel, equipment and material) that increased some individual items up to four times during 2005-09; further deterioration of the I&D networks that required more comprehensive rehabilitation works; the subsequent need to change the design of the reservoir embankments due to further deterioration (that increased costs by a factor of five); and the broader scope of geotechnical investigations of the Dam for safety concerns (that increased costs by a factor of four). For example, the length of embankments to be rehabilitated was reduced considerably to accommodate the much more extensive works that were needed to ensure the stability of the embankments. While this reduced actual project coverage, the team believed that the more comprehensive rehabilitation was appropriate when combined with better selection of sites. In addition, given the poor capacity for maintenance, these more extensive works were expected to mitigate the need for constant maintenance, and support sustainability of the rehabilitated sections.

28. Lack of counterpart funding during 2008-09 affected the execution of on- going and new contracts, and had financial implications for the project. To address

7 The Project Paper of May 25, 2010 states that without the AF, the works would remain unfinished and the PDO would not be achieved (paragraph 18, Project Paper). It should be noted that the ISRs of 12/30/2009 and 10/17/2010 rated progress towards the PDO as ‘satisfactory’. This rating was only downgraded to MU in the ISR dated 6/22/2012.

this situation and mitigate further delays, the first restructuring in February 2010 included an increase to 100 percent financing of the works for all future contracts.

29. At the time of the MTR, there were delays in the implementation of Dam Safety studies. The Panel of Experts (POE) and the Bank’s Dam Advisor had recommended a reduced scope of dam safety investigations that they deemed sufficient at the stage. Combined with delays in carrying out the required geotechnical investigations due to the high reservoir water levels, and the project budget constraints and allocation issues, the final report on the Kayrakkum Dam Safety was late.

30. Delays in construction works made it unlikely that all the works would be completed by project closing and the PDO would be fully achieved, necessitating a third extension of the closing date by one year, to May 31, 2014. The delays were due to the very tight window for implementing works that were affected by water levels in the reservoir; the agricultural growing season; and the harsh winter season. Effectively, for many of the works, this left only a few months per year during which construction could be executed. This also required good management and planning skills of the PMU. The affected works included rehabilitation of embankments, canal lining, rehabilitation of pumping stations, cleaning of drainage canals and installation of polyethylene pipes.

31. Slow farm restructuring under the LRCSP delayed execution of Component 3. The local authorities in some areas were reluctant to implement land reforms, and consequently no foundation was established for setting up the WUAs. As combining land restructuring with irrigation rehabilitation works and support to WUAs constituted key elements of the FVWRMP, the PMU worked closely with the local government to resolve this issue. These delays, however, exacerbated the already weak WUA capacity to recover costs and conduct maintenance, and contributed to the need for the final extension of the Project.

32. The appointment of a new Director (following the sudden loss of the PMU Director in June 2012) took almost nine months, and further limited progress in several areas (i.e. construction works, strengthening capacity of WUAs and land reform). During this period, the signing authority was not delegated to the acting PMU Director, which led to disruptions to project management and the timely replenishment of project accounts. Staff salaries were not paid. The absence of a PMU Director also curbed the interaction between the project and local authorities that was critical for accelerating farm restructuring, particularly in an environment where some stakeholders were voicing strong resistance to restructuring, and where frequent interactions between project management and local authorities was required8.

8 Aide Memoire, March/April 2013

33. Project restructurings took place in a timely manner, including following the MTR, when the team recognized that considerable shortfalls in project outputs were threatening the achievement of the PDO, and proceeded to reallocate funds to enable works to continue, and to secure additional financing. The expected activities and outputs (at approval) were reduced significantly at the MTR, reducing the project’s overall reach (see Table 1 in Annex 2). The Project’s IP and PDO ratings remained MU until the end of 2013, when they were upgraded to MS9.

2.3 Monitoring and Evaluation (M&E) Design, Implementation and Utilization

34. M&E design envisaged making use of existing data sources, supplemented by regular routine project data collection and special surveys to evaluate outcomes. The project’s RF was comprehensive and included relevant indicators to capture the project’s activities under each component. The reporting formats for each component and sub- component were based on the annual performance targets and monitoring indicators as shown in Annex 3 of the PAD.

35. Overall, the M&E system was reasonably well maintained. The M&E Specialist provided regular reports on M&E to the PMU. However, there were issues related to the methodology/framework of undertaking M&E for the project. The reports submitted by the PMU to the Bank in the earlier years, around mid-2009, were more focused on project oversight and centered on the project procurement cycle and the state of each contract and outputs rather than looking at project outcomes. The scope and focus of M&E activities were clarified, and the Bank team suggested methods to collect data under each component and update the status of project intermediate outcome indicators. The Project also regularly monitored environmental, health and safety measures, including conducting regular audits of waste segregation and collection practices, tracking waste generation trends and monitoring of groundwater quality. Monitoring included a final M&E report on the status of FVWRMP implementation and outputs of all components.10 The independent project impact assessment would have been stronger if the project had identified a control group at project start-up, or obtained a baseline for a sample of representative households in FV at project start-up and followed up with a final survey of changes experienced by the same households as a result of the project (see Annex 5).

2.4 Safeguard and Fiduciary Compliance

36. The Environmental Assessment (EA) confirmed FVWRMP as a Category ‘B’ project as it found no major irreversible, cumulative or longer-term adverse impacts. In fact, the EA identified a number of positive effects associated with improved irrigated agricultural productivity, improved public health, reduced water losses and enhanced soil

9 The final ISR was submitted but has not been archived. Both Progress towards Achievement of PDO and Overall Implementation Progress were rated Moderately Satisfactory in that final ISR.

10 Draft Final Report of Monitoring and Evaluation of the Results of FVWRMP Implementation, Part 1 and 2 and Annexes, Dushanbe, February 2014.

fertility. The EA confirmed the application of two safeguard policies, i.e. projects on international waterways (OP/BP 7.60) and safety of dams (OP/BP 4.37). 11 The Environmental Management Plan (EMP) included a detailed monitoring plan with indicators to allow the PIU to determine the direct and indirect environmental and social impacts.

37. The MTR observed that most of the contractors responsible for rehabilitation works were enforcing mitigation measures related to environmental management aspects and workers’ occupational health. However, safety aspects of rehabilitated works (completed or during their execution) were being inappropriately managed, with no sign of on-going works and no delineation of work area. This was considered a serious issue requiring urgent action. The mission suggested putting up signs where preparation work was being done for reinforcement of the dam embankment. The mission also learned that chemical/test kits that received ‘No objection’ for purchase were expired for at least four years. Thus, the mission considered that these chemicals would provide errors in analysis and advised the lab to provide a current list of used and non-used existing chemicals. At the Bank’s insistence, new chemicals/test kits were procured. This lack of oversight was due to the vacant position of the Environmental Specialist at the PMU. Monitoring of EMP implementation was regularly performed by the PMU Environmental Specialist (ES) until June 2008, when his contract expired. Although the project M&E consultant had partially covered these aspects by visual observation, overall implementation lacked consistent reporting and communication to/from the PMU on EMP aspects since June 2008. At the MTR, it was agreed that the PMU would hire a specialist immediately, and Environmental Safeguards was downgraded to MS due to weak compliance. The teams worked out an action plan to resolve these issues12. An Environmental Specialist was hired, and the environmental assessment was rated satisfactory by project closing. However, the overall safeguards rating at project closing was MS, since the KPI on Safety of Dams was not met.

38. Procurement. Overall, the PMU followed the procurement processes based on Bank guidelines and had enough capacity to process all necessary procurement work under the project. Procurement, however, was downgraded following the Post Procurement Review (PPR) in 2009, due to the processing and award of contracts, which

11 For existing dams, under OP 4.37, the Bank requires that the borrower arrange for one or more independent dam specialists to: (a) inspect and evaluate the safety status of the existing dam, its appurtenances, and its performance history; (b) review and evaluate the owner's operation and maintenance procedures; and (c) provide a written report of findings and recommendations for any remedial work or safety-related measures necessary to upgrade the existing dam to an acceptable standard of safety. The Bank may accept previous assessments of dam safety or recommendations of improvements needed in the existing dam if the borrower provides evidence that (a) an effective dam safety program is already in operation, and (b) full-level inspections and dam safety assessments of the existing dam, which are satisfactory to the Bank, have already been conducted and documented.

12 MTR Aide Memoire, June 2009, page 46

in two instances, deviated from the Bank’s Procurement Guidelines13. These cases were addressed in a follow-up letter to the PMU requesting clarification and advice on preventing the recurrence of such issues in the future. Overall, procurement performance of the PMU remained satisfactory. Lack of Government contribution of funds, however, delayed contractual payments to contractors.

39. Financial Management (FM). The FM review at the time of the MTR pointed mainly to two weaknesses in project FM: (i) the delay in submitting the Financial Management Reviews (FMRs); and (ii) the inadequacy of internal controls. FM was downgraded to MS due to the late reporting and the untimely availability of counterpart funds. The Bank requested that the PMU hire an assistant to the chief accountant to facilitate segregation of duties and provide better control over FM issues. The FM supervision mission in August 2012 further downgraded FM due to several shortcomings, including significant delays in submitting the project audit, and project IFRs for 2011 and 2012, and weaknesses in the implementation of internal control procedures. In late 2013, FM was upgraded to MS as the Government submitted the project and AF financial statement in a timely manner, and the PMU took steps to implement recommendations (i.e. approval of project budgets for 2013, adherence to procedures in the Project Operations Manual, finalization of the register of fixed assets).

2.5 Post-completion Operation/Next Phase

40. There is a proposed follow-up project, FVWRMP 2 in 2016, to continue with the activities under FVWRMP, and also ongoing work on the analytical and advisory study on Irrigation Strategy. Development partners are also focusing their efforts in the agriculture and irrigation sectors. Under Component 2, the detailed geo-technical investigation was not conducted, as it appeared that the amount allocated to this activity was significantly underestimated. Towards the end of FVWRMP, the mission learned that the EBRD was preparing a new project in support of Kayrakkum dam safety. A detailed geo-technical investigation has been included into the design of that project and is expected to be conducted in 2015.

41. With regard to the WUAs, following recommendations of the Bank, the WUAs increased the irrigation service fees (ISF), which in turn have allowed them to allocate more funds for O&M of the on-farm I&D network. WUAs, with assistance from the PIU and NGO “Zaniya” have prepared budgets and calculated the optimal membership fee rates that would be sufficient to cover their budgets and maintain the on-farm I&D infrastructure.

13 MTR Aide Memoire, May/June 2009, Annex 4

42. In addition, the Tajikistan Second Public Employment for Sustainable Agriculture and Water Resources Management Project 14 (PAMP II) project collaborates with the USAID Family Farming Program (FFP) on WUA development. USAID has extensive experience with WUA development in Tajikistan and has developed an effective approach that is widely used by other donors. This approach is based on small grants to selected WUAs to finance limited improvements to I&D infrastructure, accompanied by intensive training and capacity building to enable the new WUAs to operate independently. Where feasible, this is followed by support to establish WUA Federations to further improve the efficiency of water delivery and water use.

43. The FFP, which runs from October 2011 to October 2014, is a broad-based program to support small-scale private farms in Khatlon, including a component to support WUA development. Of the 12 districts in which FFP is operating, seven overlap with the PAMP II project. Both projects have the same criteria for the selection of irrigation schemes for support, and the same approach to WUA development. Based on this approach, agreement has been reached to work together to increase the overall number of WUAs developed in the seven common districts. Within these districts PAMP II will take responsibility for the rehabilitation of I&D infrastructure through the public works program, and FFP will be responsible for the establishment of new WUAs. As a result of this collaboration, 42 new WUAs will be established by FFP and 20 by PAMP II. The cost savings for PAMP II will allow it to provide support for 33 further, existing WUAs in the Kafernigan basin to strengthen their links with the Mirobs and the new river basin organization to be established in this basin under Component II. The project will also benefit from FFP’s assistance with the training of staff to implement WUA development.

3. Assessment of Outcomes

3.1 Relevance of Objectives, Design and Implementation

44. FVWRMP’s objectives remain relevant to the Country Partnership Strategy (CSP) for 2010-13 (now extended to 2014), and contributes directly to its second objective of sustained post-crisis recovery through an emphasis on increasing agricultural productivity and maintaining capital assets for power generation. As mentioned in Section 1.1, FV is a culturally and economically important region of Central Asia, and agricultural income from FV affects about 2 million people in Tajikistan. Efficient agriculture, irrigation and water management remain critical to enhancing the livelihoods of these people. The Project also maintains its high relevance in a sub-regional context.

45. The project design was relevant, and its activities and components were a perfect fit within the context of integrated water resources management (IWRM). However, FVWRMP’s design had several shortcomings as detailed in Section 2.1. These related to

14 Approved on November 29, 2012 in the amount of US$45.9 million

the complex set of activities to be achieved, including addressing difficult and risky dam safeguards issues with modest resources, and in a country that had very limited overall capacity. These design issues resulted in several implementation delays as detailed in Section 2.2. The Bank’s assistance, however, was responsive to setbacks in implementation as demonstrated in the project’s restructurings.

46. At the second restructuring and AF, the project revised its PDO to include the completion of the geotechnical study of the dam, i.e. an output. This was a complex and multi-faceted task that required deep analytical and field work, and more resources than the amount allocated to the activity.15 FVWRMP was designed (and 70 percent of the funds were allocated) to support GoT’s strategy for improving agricultural productivity. This was envisaged to be done through rehabilitating the I&D systems that had fallen into disrepair and contributing to unreliable supply of irrigation water, drainage and waterlogging problems, and reducing soil fertility and crop yields. Although activities under Component 2 addressed strengthening the reservoir dykes and minor works to increase the dam’s operational performance and safety, the main objective was to increase efficiency at the basin level. At the time of the AF, the project’s focus seems to have shifted to investigate dam stability and the remedial works needed to address risks of Kayrakkum dam—a massive structure built in the Soviet era in 1959, where the dam’s structural integrity was uncertain, and its study would have involved substantial technical knowhow and bringing in complex equipment.16 With hindsight, including this complex and costly study into the project’s objective increased the risk of not fully achieving the PDO. It would have been more appropriate to include it as a KPI, as the project did, rather than in the PDO.

3.2 Achievement of Project Development Objectives

47. This section presents the linkages between FVWRMP activities and outputs (detailed in Annex 2) and the achievement of the KPIs and final project outcomes.

48. For ease of comparison, Table 1 presents the original and revised KPIs. At the time of the restructuring in May 2010, the project had disbursed 75 percent of funds and completed a significant volume of works and Technical Assistance (TA), including: rehabilitation of a third of the envisaged tubewells, more than half of the planned primary supply irrigation canal, and a third of the main drainage canals; four out of nine large pump stations that were in the final stages of rehabilitation; cleaning of one fifth of the

15 The project attempted twice to recruit a consultant to conduct the study; however, it did not attract adequate interest from any firms. 16 The Panel of Experts’ (PoE) report identified three categories of priorities. FVWMP limited its activities to the first level (Category 1) that included the completion of a more in-depth geotechnical study, further investigations of dam stability and the design of any relevant remediation works, and implementation of an effective early warning system, complemented by suitable emergency procedures for mitigation of losses in case of a dam failure. The project did not undertake in-depth works on the dam due to limited resources and the lengthy process of obtaining agreements from all riparian countries to undertake in-depth works on the dam.

envisaged main drainage canals; further clarifying the safety of the dam by conducting studies and safety measures on the dam and reservoir; and establishing a WUA and performing yearly field demonstrations (Project Paper, 2010).

Table 1. Original and Revised Key Performance Indicators (Outcome Indicators)

Original PDO Indicators Revised PDO Indicators (i) 70% of reduction of flooded and (i) Reduction of flooded and waterlogged land waterlogged land areas within project areas within project perimeters near levees perimeters near levees (UNCHANGED). (ii) 30% improvement in timely water (ii) Area returned to effective irrigation under availability in irrigated areas under the project (NEW) project (REPLACED) (iii) WUA established and functioning DROPPED adequately in Western Kannibodom (iv) 80% collection of billed water fees (iii) Collection of billed water fees by WUAs from WUAs established for more than a (NEW) year under the project, for O&M of I&D gravity and pumping systems, particularly tubewell systems (REPLACED) (v) 10% minimum increase in crop yields DROPPED (vi) dam safety management and (iv) early warning system established/improved emergency action plan in place and tested (NEW) (REPLACED) (v) detailed dam geotechnical study completed and an executive summary with all the main recommendations prepared to be shared regionally (NEW) (vii) forecast accuracy for available (vi) forecast accuracy for available reservoir reservoir storage volumes and storage volumes and inflow/outflow volumes inflow/outflow volumes improved to improved 70% accuracy level (UNCHANGED)

49. The project was having a positive impact on the population in the project areas by reducing flooding of large tracts of farm land and villages alongside the embankments of the Kayrakkum reservoir. During the dry season, the project was also contributing to more equitable and reliable water supply and distribution, and improving the potential for better harvests and farm income. However, cost overruns and slow implementation were threatening full achievement of the PDO. Based on the activities and outputs at the time of the MTR in May 2009 and in October 2010, presented in Table 1 of Annex 2, the ICR rates the PDO achievement as Moderately Satisfactory (MS) at restructuring.17

Table 2. FVWRMP Revised KPIs (PDO Indicators): Targets and Actuals Achieved

17 The Restructuring Project Paper reports on achievements at the time of the MTR and in October 2010. See Table 1 in Annex 2 of ICR.

Project KPIs Original End of End of Project End of (Outcome Indicators) (baseline) Project Actual Project (% Target achieved) (for AF) (i) reduction of flooded and 5000 3,500 3,530 100.8 waterlogged land areas within (KPI project perimeters near achieved) embankments (ha) (ii) Area returned to effective N.A. 6,450 7,349 113.9 (KPI irrigation under the project (ha) achieved) (iii) Collection of billed water 30 80 86 107.5 (KPI fees by WUAs (%) achieved) (iv) early warning system 0 100 100 100 (KPI established/improved and tested achieved) (% complete) (v) detailed dam geotechnical None Final Not achieved. (KPI not study completed and an executive (ensured that this achieved) summary with all the main study is funded recommendations prepared to be and executed by shared regionally (Action Plan) EBRD) (vi) forecast accuracy for None 6 6 100 (KPI available reservoir storage achieved) volumes and inflow/outflow volumes improved (number) Note: See Annex 2 of ICR and Project Restructuring Paper, May 25, 2010, p. 8-14.

• KPI (i): reduction of flooded and waterlogged land areas within project perimeters near embankments (ha); and • KPI (ii): Area returned to effective irrigation under the project (ha)

50. Outputs under Component 1 allowed the project to achieve the first two KPIs and a key part of the PDO, i.e. increasing the coverage of drained and irrigated areas in Gafurov and Kannibodom districts. These results were attained by cleaning the basic collectors and drains, and rehabilitating and repairing I&D off-farm and on-farm infrastructures. The term “ameliorative condition of the irrigated lands”, which is widely used in Tajikistan refers to a combination of the level and mineralization of sub-surface waters and the degree of salinization of the irrigated lands, usually in a meter layer of soil. Cleaning of collectors and drains allows maintaining the sub surface waters at an admissible level and carrying out of all field works in the best agro-technical terms, positively influencing productivity of agricultural crops. Cleaning also promotes increased filtration speed of excessive soil water in drains and collectors, thereby accelerating the removal of harmful salts from the root layer. Thus, the ultimate benefit from cleaning of drains and collectors is the stable maintenance of the irrigated lands in the best ameliorative condition and the creation of favorable water-air and salt modes of soils for cultivation of agricultural crops. This benefit is expressed in the area with the improved ameliorative condition (IAC).

51. According to design data, as a result of collectors and drains (CDN) cleaning, the level of sub surface waters has gone down from 1.4 meters to 1.0 meter. In total, the area with IAC from cleaning on all project territory is 6250 hectares (3,850 ha in Kannibodom region and 2,400 ha in Gafurov region).18

52. To decrease the level of subsurface waters and water logging of lands, the project supported: • repair and cleaning of the main and secondary off-farm collectors (117.61 km); • repair and rehabilitation of drainage and irrigation pump stations (10); • repair and rehabilitation of tube wells of vertical drainage (110); and • rehabilitation of tube wells for monitoring the level and quality of underground waters (97).

53. To reduce water losses from canals, and improve the water security of lands, the works performed included: • Lining of selections sections of BFC (11.36 km); • repair and rehabilitation of the structures on the BFC canal (161), which helps to promote improved water resource management; • the area with advanced off-farm and on-farm I&D systems (4,800 ha); and • rehabilitation of the Kannibodom Concrete Canal (13.01 km, that is 100 percent achievement of the target). The detailed designs of all the rehabilitation works were completed.

54. Reducing sub surface waters by rehabilitating vertical drainage wells (VDWs). VDWs have great value in decreasing the level of sub surface waters and capturing deep water streams flowing from adjoining territories. The project helped to rehabilitate 110 vertical wells (81 in Kannibodom district and 29 in Gafurov district) that are used for drainage of deep underground waters. In most cases, drainage waters from these wells are used for irrigation of agricultural crops. Rehabilitation of wells allowed improved drainage on 2462 hectares of the land (1871 hectares in Kannibodom district and 591 hectares in Gafurov district).19

55. Protecting land from inundation and flooding by rehabilitating drainage pumping stations. Drainage pumping stations are intended for pumping out of drainage waters into the Kayrakkum water reservoir. 20 The total area served by the drainage pumping stations is 6705 hectares. As a result of rehabilitation of drainage pumping stations, 3530 hectares were provided protection from inundation and flooding in Kannibodom district (2330 hectares) and in Gafurov district (1200 hectares). This represents 100.8 percent achievement of the project’s first KPI.

18 FVWRMP, Draft Final Report of Monitoring and Evaluation, Part I, February 2014. 19 See Draft M&E Report, 2014, p. 61, Table 12 for details on the decrease in level of sub surface waters related to rehabilitation. 20 See Draft M&E Report, 2014, p. 62-65 for details of volumes and repair/rehabilitation works of the drainage pumping stations.

56. Multiple outputs and factors combined to help the project to return 7,349 hectares to effective irrigation (representing 113.9 percent achievement of KPI (ii)). It is not possible to separately add which works/outputs helped a specific area; therefore these outputs and links are listed below:

57. Improving provision of irrigation through rehabilitating the irrigational pumping station Mahram-1. Pumping station Mahram-1 was constructed in 1975 for improving the provision of irrigation water for the lands of the east part of Kannibodom district, an area of about 4000 hectares. There are 8 pumping units in the pumping station, out of which 6 are of high pressure and 2 are of low pressure. The total discharge of all units constitutes 12 m3/sec., and the capacity is 11600 kW/h. Water is conveyed by means of three lines of the pipelines, two of which convey water to the canal BFC and one to the canal M-1.

58. The pumping station takes water from the Kayrakkum water reservoir and conveys it to the Big Fergana Cana. The command area constitutes approximately 4000 hectares of the lands. These are the areas of WUA Dehkan and WUA Mirzomalik, also the areas of private homestead land plots and the areas that are irrigated above the canal BFC by means of private small pumping units. Due to depreciation of pumping units, the system of electrical supply, and the hydro mechanical and power equipment, the pumping station worked at about half of its capacity, i.e. provided effective irrigation for about 2000 hectares of the lands. As a result of rehabilitation of 6 pumping units of high pressure and 2 units of low pressure, and also replacements of electrical and the mechanical equipment, the pumping station has reached 100 percent of designed capacity, i.e. 4000 hectares provided with water on a sustainable basis.

59. Reducing water losses from concreting and rehabilitating water outlet structures of the Big Ferghana Canal (BFC). The Big Ferghana Canal (BFC), which was constructed in 1939-40, is one of the largest irrigational structures of the USSR, and originates from the basic source of Syr-Darya River. The total length of the former Canal is 393 km, which pass across the territory of Uzbekistan (283 km) and across Tajikistan (110 km). The command area of BFC within the territory of the Kannibodom State water Management Department (KSWMD) is 15,200 hectares. The lower part of the Canal is in the western part of Kannibodom, and the higher part comes from Uzbekistan and traverses eastern Kannibodom. Since the canal originates in Uzbekistan, water delivery is very unreliable, and hence project investments in pumping stations along the BFC to pump water from the Kayrakkum reservoir. All of the canal is in the territory of Gafurov district, and has concrete lining. However, large losses of water were observed along the unlined sections of the Canal in the western part of Kannibodom. Studies report that water losses on this section reached an estimated 35 percent (i.e. canal efficiency of 65 percent). According to practical gauging done by the District Water Management Agency, the water efficiency was increased from 58 percent to 78 percent following concreting this section of BFC for water for irrigation of about 60 percent of all territory of WUAs or about 2,000 hectares. This gauging also testifies to reducing losses of water.

60. The project planned to conduct lining of the Canal on an extent of 11,349 m. The project completed concrete lining of chosen sections of BFC on an extent of 11,361 km.

61. Along the Canal, in the territory of Kannibodom district, there are 102 water outlets, which were in poor condition and allowed large technical losses of water. BFC is additionally fed by waters of the river Isfara by means of the KCC and the Canal Chor Arik, which head water intake structures begin from the hydro unit of Ravat. Water is also fed to the Canal by pumping station Mahram-1, on the border of Western Kannibodom and Khojabakirgan in the territory of Gafurov district. The project fully rehabilitated 161 structures in all on BFC including water outlets (104), hydrometers (49), hydro bridges (6), and one water measuring post and one mud flow discharge over the Canal (see Annex 2 for detailed works).

62. The value of technical losses from structures before their rehabilitation reached 25 percent from the water intake volume, and after rehabilitation these losses have been reduced by 80 percent. Prior to rehabilitation, annual technical losses of water from water outlets in 2012-2013 amounted to roughly 27 to 33 million m3. After rehabilitation, this decreased to 5.4 to 6.6 million m3. These figures are confirmed by the analysis of change of losses of water on canal BFC. Comparison of water loss on the average for 2006-2009, when active interventions in the canal were not conducted, and for 2010-2013 when structures had already been partially rehabilitated and the canal also was concreted, show on them reducing by 12 million m3 along all of the Canal, and on the section of command area of PS Mahram by 4 million m3.

63. Benefits from increasing Canal discharge capacity through rehabilitation of Kannibodom Concrete Canal (KCC). The KCC is intended to feed into BFC from the river Isfara when water delivery from Uzbekistan in BFC reaches a minimum (from mid- June) and the farms located below crossing of the KCC with BFC lacks water. For reliable provision to the farms located below crossing of the KCC with BFC, its’ designed throughput capacity should be approximately 17 m3/s. Due to strong speeds of water in the canal, several sections of the canal were badly damaged and structures needed rehabilitation and cleaning to increase the discharge of the canal. According to the information provided by the Kannibodom State Water Management, before rehabilitation, the Canal’s capacity for discharge to BFC was only 10 m3/seconds.

64. The project supported several activities to increase the discharge of the canal, including sedimentation basin cleaning, rehabilitation of water outlets etc. Presently the canal discharge capacity is approximately 15 m3/s., or 1.5 times greater than it was before rehabilitation. Rehabilitation of KCC has allowed KSWMD to increase the share of water delivery of the district on account of waters of the river Isfara from 31 percent to 53 percent. It has lowered the influence of decreased inflow of BFC from Uzbekistan for irrigation needs of lands by almost 29 percent. It is possible to assert that KCC has provided increases in water security of the sub command zone of BFC on the area of 11,200 hectares (in total, the sub command zone of BFC including PS Mahram 1 is 15,200 hectares).

65. Benefits from rehabilitation of on-farm I&D infrastructure of WUAs. On-farm I&D infrastructure was rehabilitated throughout on area of 4800 hectares in WUAs Mirzomalik and Kavsari Kandy Kuhan of Kannibodom district for the purpose of improving water resources management and reducing water loss. The water savings and efficiency improvements are basically provided by constructing a new pipeline network that reduces water losses during its transportation to irrigation fields. Moreover, these pipelines provide water for the fields that are located below a highway and which suffers most from the shortage of water. The project rehabilitated on-farm sprinklers of WUA Mirzomalik and of WUA Kavsari Kandy Kuhan to improve water supply.

66. Before construction of pipelines efficiency of the on-farm network (which is located on the line with high water penetration) did not exceed 0.6, i.e. losses constituted about 40 percent from volume of the taken away water. The Efficiency of the pipeline network equals approximately 0.95, i.e. losses constitute no more than 5 percent from water intake volume. Overall, the constructed network of pipelines allows the preservation of about 6.3 million m3 waters that will be directed for improvement of water security of crops in WUAs.

67. Overall, project outputs: (i) achieved a decrease in the level of subsurface waters on a total area of 6416 hectares (4,755 ha in Kannibodom district and 1,661 ha in Gafurov district); (ii) protected 3530 hectares of land from inundation and flooding (boggy and impounded riverside lands), including in Kannibodom district--2330 hectares, and in Bobojon Gafurov district--1200 hectares, through the rehabilitation of drainage pumping stations; and (iii) provided further protection of lands against inundation on a total area of 1186 hectares, including in Kannibodom district--666 hectares and in Bobojon Gafurov district--520 hectares. In all, the return of the lands to effective irrigation is estimated at 7,349 hectares.

68. During the final field visits in May 2014, the Bank team observed that farmers were taking strong ownership of the rehabilitated infrastructure and were investing in additional irrigation infrastructure. Some farmers had taken over management of VDWs and were paying for the electricity and repairs. Some had co-financed investments in the VDWs (as high as 21,000 TJS, about US$4,200 equivalent). The more reliable water supply has also led farmers to adopt higher value production, thus enabling them to pay more for O&M.

• KPI (iii): Collection of billed water fees by WUAs

69. The project’s target rate for irrigation fees to be paid to the water supplier was 80 percent. This has been exceeded by all three WUAs, as shown in the tables below.

Table 3: Changes in Fee Collection Rates from 2011 to 2013 KKK Mirzomalik Dehkan Average 2011 Percentage of Fee Payment Irrigation Fees 50 40 67 52.3 Membership Fees 8.1 32 78.7 39.6 Household Water 64.6 39 51.8

2012 Percentage of Fee Payment Irrigation Fees 60.9 39.9 86.8 85.3 Membership Fees 68.9 41.8 87.2 66 Household Water 69.6 110.3 68.5 90.6 2013 Percentage of Fee Payment Irrigation Fees 84.4 81 92.1 85.8 Membership Fees 100 99.5 100.3 99.9 Household Water 107 97 101.4 101.8

Table 4: Membership Fees—2013 to 2014 (TJS) WUA Irrigated Estimated Budget, 2013 Fee 2014 Fee Collection Area (ha) May 2014 (TJS) (TJS/ha) (TJS/ha) Percent (%) KKK 2,068 93,060 15 45 100 Mirzomalik 1,999 99,450 20 50 99.5 Dehkan 1,064 170,750 20 160 100.3

70. Project activities that helped WUAs to achieve this outcome are detailed in Annex 2. In terms of establishing WUAs, the project worked extensively with the three pilot WUAs in the project area (Kavsari Kandi Kuhan (KKK), Mirzomalik and Dehkan, supporting 6,500 hectares) to provide training and hands-on assistance in the organization of mechanized and manual cleaning of I&D canals, development of business plans, M&E of WUA activities, and taxation of WUAs. The WUA Directors and accountants were trained in cost recovery, calculation of membership fees, and preparation of budgets. In addition, the project renovated offices of the WUAs, procured office equipment and furniture, water measurement devices, as well as procured some machinery.21

71. Although the process of building WUA capacity was slow and contributed to the need to extend the project’s closing date by one year, activities came together in the final year to help raise overall cost recovery. The specific outputs that contributed to this include: (i) the rehabilitation of the I&D network, which improved water delivery by WUAs, and, in turn, earned more trust from water users; (ii) training; for example, WUAs are now capable of calculating an optimum water delivery service fee that would cover their costs to maintain the on-farm system. They discuss these issues with users at the General Meetings and seek agreement to raise the fee when needed; (iii) land reforms, where more users pay their fees compared to a few large farms in the past that had a tendency to pay directly to the raivodkhoz. For example, the reform of Dehkan Farms (DFs) in the territory of WUA Mirzomalik resulted in the creation of 507 new DFs instead of 24 large ones. In KKK, 973 DFs were created; and (iv) procurement of office furniture, renovation of the WUA offices, and provision of machinery to the weakest WUA Mirzomalik (located at the end of the BFC). Most importantly, all these factors/outputs combined to enhance the empowerment of WUAs, which was critical. WUAs now seem to believe in what they do and have become more pro-active in making key decisions that improve their operations.

21 See M&E Draft Report, 2014, p. 112 for details on all contracts/activities completed.

72. In 2012, the PIU contracted the NGO, “Znaniya” to provide training to the three WUAs in order to strengthen their capacity. The PIU and the NGO assisted WUAs with preparation of realistic O&M plans to maintain the on-farm I&D network, and have closely monitored the actual implementation of the planned tasks.

73. During the final mission’s field trip to the project area, the team noted that all WUAs were now functioning much more actively and performing their responsibilities efficiently. Following recommendations of the previous mission, the WUAs had increased the irrigation service fees (ISFs), which, in turn, allowed them to allocate more funds for O&M of the on-farm I&D network. The increased rates were approved by the WUA’s members at the General Assembly Meetings. The largest increase was in Dehkan WUA where the VDWs are primarily drainage wells and serve all members by reducing high water tables. In the other two WUAs electricity charges for the wells were being billed to individual members who receive water directly from the wells. As a result of the increase in ISFs that allowed greater budgets for O&M, all WUAs have succeeded in 100 percent implementation of planned O&M works.

74. Although the performance of WUAs has improved significantly as a result of project support, continued support to WUAs (beyond project closing) will be required. There are also other issues beyond this project that need to be addressed, such as farm restructuring and handling of a large WUA membership, taxation of WUAs and the transfer of I&D assets to WUAs.22

• KPI (iv): early warning system established/improved and tested; and • KPI (v): detailed dam geotechnical study completed and an executive summary with all the main recommendations prepared to be shared regionally

75. Outputs realized under Component 1 that helped to achieve the first PDO indicator, that is, reduction in flooded and waterlogged land areas in the zone of the project near the embankments in Kannibodom and Gafurov districts, together with outputs under Component 2 have essentially helped to improve the management of the water reservoir, and decrease the risk of breach of Kayrakkum Dam and its consequences for the population living in lower reaches of the Dam, by working out the procedures for operation of the Dam in the event of a major force.

76. These achievements were a result of the following works and outcomes:23 • Rehabilitation of 6656 meters of embankments of Novostroyka and Yakkaterak in Kannibodom district and 2045 meters of embankments in Gafurov district have provided protection from flooding on an area of 666 hectares in Kannibodom and 520 hectares in Gafurov;

22 See final Aide Memoire, May 30, 2014 and Section 4 of ICR for details. 23 See ICR Annex 2 and the M&E Draft Report, 2014, p. 86-87 for details on works executed under Component 2.

• The safety of the dam has been improved by strengthening of the upper slope of the dam; improving drainage of the dam by installing new deep pumps, and rehabilitating drainage of the downstream slope of the dam; • Specification of sediments’ volumes in the water reservoir, which allows to improve its operation at water use planning; • Preparation and realization of an action plan on the dam in an occurrence of extreme situations; and • Preparation, installation and introduction into operation of Early Warning System (EWS) of the population.

77. Early Warning System (EWS). A key project output is the Consultant’s plan that offers an early warning system in Kayrakkum Hydro Unit in the event of the high waters, and earthquakes or other natural disasters. This is in three parts: (i) forecast and threat assessment; (ii) dissemination of the information and instructions for operative actions; and (iii) fulfillment of the instructions for operative actions. The plan of readiness for emergencies provides a basis for the assessment of threat, dissemination of the information and corresponding actions during an emergency situation.

78. Reaction to instructions. The EWS and plans of readiness for emergencies are inefficient if the population does not react in an appropriate way to the instruction given. For this reason, programs for training of the population living in the flooded zone of risk, caused by potential break of the Dam, and corresponding actions that should be undertaken, have been completed.

79. Plan of readiness for emergencies. The Consultant has prepared a Plan of readiness for emergencies for the location around the Dam. The main responsibility for emergency readiness and acceptance of necessary measures is born by the Committee of Emergency Situations. Besides, Barqi Tojik the Administrations- Hukumats of Khujand also are responsible parties. Therefore, such readiness should be organized under the supervision of the Committee of Emergency Situations. If it is possible, this Committee can be engaged in creation of an Integrated Early Warning System that requires coordination with other neighboring countries.

80. As mentioned earlier, the detailed geo-technical investigation has not been conducted despite the fact that the PIU launched the associated tender twice, without receiving any expression of interest. Upon investigation, it appeared that the amount that was allocated for this activity was significantly underestimated. Reallocation of resources was no longer an option as most project funds had already been spent. However, the Bank learned that the EBRD was preparing a new project in support of Kayrakkum dam safety. A detailed geo-technical investigation has been included into the design of that project and is expected to be conducted in 2015.

3.3 Efficiency

81. The economic rate of return (ERR) and the financial rate of return (FRR) analysis are presented in Annex 3. The estimated ERR of the project is 24.3 percent.

The net present value (NPV) at a 10 percent discount rate for a project period of 20 years is estimated at US$ 28.43 million. The FRR is 19.4 percent.

3.4 Justification of Overall Outcome Rating

Rating: Moderately Unsatisfactory

82. FVWRMP was relevant at the time of appraisal and continues to be relevant. The project met all but one of the revised KPIs. Project outputs, however, were revised down significantly during implementation, as shown in Annex 2 (Table on Project achievements at MTR and New Targets at AF). Issues related to design and implementation severely delayed project activities and threatened the achievement of the original PDO and associated targets, necessitating this downward revision of the original project output targets. The project contributed to increasing the coverage of drained and irrigated areas in Bobojon Gafurov and Kannibodom raions and strengthening the early warning system of the Dam, however, it did not achieve part of the revised PDO related to carrying out a geotechnical study to assess the risks associated with the Dam. In terms of efficiency, the analysis indicates a reasonable ERR and FRR.

83. The project had a formal change in PDO. Achievement of outcomes against the original PDO is rated as Unsatisfactory (U). Achievement of the revised PDO is rated as Moderately Satisfactory (MS).24

3.5 Overarching Themes, Other Outcomes and Impacts

(a) Poverty Impacts, Gender Aspects, and Social Development 84. FVWRMP did not explicitly measure impacts on poverty. However, a survey of 100 households (11 households in each target jamoat) suggests that the total income of households increased from 367,875 somoni in 2006 to 1,044,271 somoni in 2013.25 The jamoats surveyed had a balanced ratio of females and males. The project has had a substantial effect on social development through the formation and strengthening of WUAs. Of the 10,000 persons trained under Component 3, 4,400 were women. The project also contributed to social development through farm restructuring, with farmers receiving user right certificates for the land that was allocated to them. Heads of farms are now able to exercise freedom in terms of the type of agricultural production, and to

24 The ratings of U, MU and MS are assigned values of 2, 3 and 4 (see Appendix B, p. 42-45 of the OPCS ICR Guidelines, August 2006, updated on 10/05/2011). In the case of a formal Bank Board-approved change in PDO, these values are weighted by the respective percentages of the total grant disbursed against the original and revised PDOs, to arrive at the final rating. As the Project had disbursed US$10.43 million of the total of US$23 million (i.e. 45.3 percent) against the original PDO, the outcome rating is based on the following calculation: [(0.453 x 2) + (0.546 x 4) = 0.90 + 2.18 = 3.08, which is an MU. 25 This survey included several jamoats where project interventions were minimal.

shift from one crop to another without requesting governmental permission or notifying local authorities26.

(b) Institutional Change/Strengthening 85. The project strengthened the capacity of the WUAs (through activities detailed in Annex 2); although there were considerable weaknesses in recovering costs and conducting maintenance activities that posed challenges for project implementation until the very end. By the end of FVWRMP, however, WUAs were taking a strong lead in managing water and organizing farmers. The stability of WUAs has been reinforced through developing a contractual system between Raivokkhoz, WUAs and Dehkan Farms for providing WUA members with water, solution of issues of taxation of WUAs, conditions and terms for transfer and use of state property. FVWRMP also helped to establish a Public Council (Fund) of the Big Ferghana Canal as a structure of participation of key interested parties in democratic management and fair distribution of water at canal level.

3.6 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops (See Annex 5 for the Summary of household survey.)

4. Assessment of Risk to Development Outcome Rating: moderate

86. The institutional risk to development outcome is substantial. The weakening of WUAs and/or the links between farm restructuring and irrigation management pose the largest risks to development outcome. As identified at project closure, and mentioned above in Section 3.2 under KPI (iii)—‘collection of billed water user fees’, there remain issues beyond this project related to WUAs. These are: (i) farm restructuring and handling a large WUA membership; (ii) taxation of WUAs; and (iii) the transfer of I&D assets to WUAs. With respect to (ii) the Bank needs to be closely involved in the discussions through the PAMP-2 project, in order to amend the WUA law to make it more effective.

87. The financial risk to development outcome is moderate. Farmers have taken stronger ownership of the rehabilitated infrastructure and are investing in additional irrigation infrastructure on the basis of project investments (Aide Memoire, May, 2014). Some have also taken over the management of VDWs and adopted higher-value production, thus enabling them to pay more for O&M. The increasing WUA membership is encouraging as WUAs will have more contracts with individual farmers, hence improving their financial standing. However, this also means that WUAs will face a

26 Aide Memoire, October/November 2013

greater challenge in operating a system with large membership. WUAs need to establish a computer database system to administer water contracts and to monitor the collection of water fees. The transfer of irrigation assets to the balance sheets of the WUAs will require an increased budget to cover O&M costs, spare parts and electricity in the future. While WUAs have been successful in increasing their membership, this will have to be maintained to ensure adequate cost recovery of WUAs.

88. The environmental risk to development outcome is low. Since the MTR identified key environmental shortcomings as discussed in Section 2.4, the environmental management system has improved. The project is also regularly monitoring health and safety measures, including tracking waste generation and monitoring groundwater quality. Data on the sanitary and epidemiologic situation in pilot areas indicate a decrease in various water-borne diseases.

89. The social risk to development outcome is low. Project activities and outputs have enhanced the empowerment of WUAs, which is critical. Also, it is likely that improved irrigation agricultural productivity and incomes, and better public health of farming households will improve food security, and the socioeconomic status of the poor in FV.

5. Assessment of Bank and Borrower Performance

5.1 Bank Performance

(a) Bank Performance in Ensuring Quality at Entry Rating: Unsatisfactory

90. The Bank team drew on lessons from similar projects implemented in the former Soviet countries and globally. However, it failed to properly address some of the key risks identified during preparation (as detailed in Section 2.1). These relate specifically to undertaking a complex package of infrastructure, including dam safety aspects, and participation, with a modest sum of US$13 million, in a country with very low capacity. The Bank team was not well-informed or disregarded the costs that would be associated with the planned infrastructure works, despite having an experienced irrigation engineer on the preparation team. The project’s design also did not include the structures needed to ensure sustainable land management for crop production. These factors all combined to severely delay implementation and the project’s reach in terms of planned outcomes.

(b) Quality of Supervision Rating: Moderately Satisfactory

91. The Bank team recognized early during implementation that weaknesses in project design posed risks to achieving the PDO. The team moved to adjust expected project outputs to realistic levels, and to include an increase to 100 percent financing of works when counterpart funding was lacking. The Bank team’s reporting, however, was not candid through the initial years and until after the MTR. There were repeated references to delays, and, specifically, the MTR Aide Memoire states that the project was falling significantly short of its originally stated output objective, while costs of

rehabilitation were substantially above the estimated budgets made at project design27. These shortfalls in outputs posed a threat to achieving the PDO, hence the need for substantially lowering the targets and revising the RF. Yet, the project’s progress towards achieving the PDO was rated ‘satisfactory’ throughout this period (except for an ‘MS’ rating in August 2009, which was upgraded to satisfactory by December 2009). At the AF, conducting the geotechnical study should not have been included in the PDO, as discussed in Section 3.1 above. The cost and level of complexity of such a study also seems to have been underestimated. Supervision improved in the latter part of the project, when ratings reflected the unsatisfactory performance of the project. The Bank fielded regular supervision missions and closely monitored progress during 2012-2013 to ensure that the revised target outputs were delivered. The team was proactive in moving the execution of Component 3 forward when the LRCSP was delayed (and as a result, land restructuring was delayed), as it was critical to combine farm restructuring with irrigation rehabilitation and support to WUAs.

92. The Bank performed satisfactorily in supervising fiduciary and other safeguards. The team worked out an action plan with the PMU to correct weak compliance in environmental safeguards following the MTR, and closely monitored procurement and FM performance. On FM, the Bank provided assistance to the PMU in facilitating the segregation of duties to ensure better control over identified FM issues.

This rating reflects the ‘U’ rating for Quality at Entry, the ‘MS’ for Supervision, and the ‘MU’ rating for Outcome (ICR Guidelines, p. 37).

5.2 Borrower Performance

(a) Government Performance Rating: Moderately Unsatisfactory

93. The government maintained effective interaction with the PMU/PIU at the national and regional levels. However, poor project design (ambitious project with such modest resources), lack of timely counterpart funding, and lack of timely replacement of the PMU Director, which are all responsibilities of the Government severely affected project outputs. Delays in funding from the government became a serious issue. As a result, contractors did not receive payments for completed civil contracts, and project activities were delayed. The Ministry of Finance also delayed responding to written communication from the PMU to in April 2009 regarding this issue and the application of penalty mechanisms (after June 2009).

(b) Implementing Agency or Agencies Performance

27 Aide Memoire, Jay/June 2009, page 3

Rating: Moderately Unsatisfactory

94. The PMU and PIU made good efforts to assist FVWRMP to move forward. The PMU followed procurement and FM guidelines and maintaining a system of accounting and reporting. There were some issues as mentioned in Section 2.4, especially with regard to environmental safeguards, and delays in submission of financial management reviews and project audits. State Executive bodies such as the Ministry of Land Reclamation and Water Resources, the Ministry of Finance, Hukumats, jamoats and Raivodkhoz, and Mahalla committees and WUAs made an essential contribution to project implementation. Changes and reappointments of the PMU Director in 2006 and in 2012/13 however had a substantial negative effect on implementation, as noted in Section 2.2. Specifically, the gap of almost nine months without a PMU Director disrupted the project management flow.

This reflects the ‘MU’ ratings for Government and Implementing Agency performance.

6. Lessons Learned

95. Implementation readiness is critical for project success, and there also needs to be flexibility in design and more proactive implementation. Especially in fragile and post- conflict states, there is a risk of implementation delays. Sometimes we take a risk and sometimes we fail. However, teams have to be prepared to adjust design and be more proactive in implementation, especially with timely MTRs and restructuring in view of disbursement levels.

96. Projects need to calculate the volume of works, consider seasonal prevalence of works and work out realistic costing/budgeting at project preparation and design to avoid mistakes. FVWRMP suffered from cost overruns partly due to ‘under design’ at preparation, resulting in severely delaying implementation and the project’s reach. It is necessary to conduct a more careful and comprehensive survey of the volume of proposed works (especially in projects that include large infrastructure building) and budgets required. Costing exercises need to be realistic.

97. When project implementation requires harmonizing the timing with implementation of other projects, teams need to identify to identify alternative actions in case of possible delays in the other project. WUA development under FVWRMP was highly dependent on land privatization under LRCSP; however, FVWRMP did not identify the risks or alternative measures in case of delays in LRCSP.

98. Farm restructuring needs to be demand-driven. FVWRMP spent time to convince some farms to implement restructuring, while there were other farms that were very keen to restructure. The Project should have prioritized these farms and proceeded on a demand-driven basis at least to begin with restructuring.

99. Projects should not include major outputs in the PDO. At additional financing/restructuring, FVWRMP included the geotechnical study as part of the PDO. This study was a complex task that also required greater resources than was allocated to the activity. This resulted in the project not achieving part of the PDO.

100. Bank teams need to more attentive to consistency in rating projects. While many activities were quite delayed and the original targets needed to be substantially lowered as the team correctly identified that the slow implementation posed the risk of not achieving the PDO, ISRs continued to rate performance against the PDO as satisfactory/MS. This should have warranted a rating in the unsatisfactory range. Lower ratings would have properly captured the difficult challenges that the project faced.

7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners

(a) Borrower/implementing agencies

Comments on this ICR were received from the GoT. These have been attached in Annex 7.

(b) Cofinanciers

Not applicable

No comments were received from other partners or stakeholders.

Annex 1. Project Costs and Financing

(a) Project Cost by Component (in USD Million equivalent) Actual/Latest Appraisal Estimate Percentage of Components Estimate (USD (USD millions) Appraisal* millions)*

Irrigation and Drainage Systems 9.02 15.04 166.7 Rehabilitation and Improvements Strengthening Kayrakkum Reservoir Dykes and Improvement 3.03 5.66 186.8 of Kayrakkum Dam Safety and Reservoir Operation Institutional Development and 1.37 1.68 122.6 Technical Assistance Project Management 0.75 1.74 232.0 Total Baseline Cost 14.17 24.13 170.3 Physical Contingencies 0.00 0.00 0.00 Price Contingencies 0.00 0.00 0.00 Total Project Costs 14.17 24.13 170.3 Front-end fee PPF 0.00 0.00 .00 Front-end fee IBRD 0.00 0.00 .00 Total Financing Required 14.17 24.13 170.3

*Includes Additional Financing (latest estimate less appraisal estimate).

(b) Financing Appraisal Actual/Latest Type of Estimate Estimate Percentage of Source of Funds Cofinancing (USD (USD Appraisal millions) millions) Borrower 1.17 0.76 64.9 International Development 10.00 10.02 100 Association (IDA) IDA Grant 13.00 13.43 103

Annex 2. Outputs by Component

Project Achievements at Mid-Term Review in October 2010 and New Targets (at Additional Financing)

Output Indicators Expected At MTR in Revised October New Outputs at May 2009 Targets 2010 Target Appraisal (completed) at MTR (completed) w/AF Component One: Lengths of main irrigation BFC 29 0 4.45 4.44 11 canals repaired/line (km) BFC irrigation structures ** 30 111 160 rehabilitated Lengths of main and secondary 415 7.48 61.48 40.74 120 drains rehabilitated (km) I&D pumping station 16 1 9 2 9 (both rehabilitated (No.) I&D) I&D tube-wells rehabilitated 200 38 110 96 118 and renovated (No.) Observation wells rehabilitated 0 0 95 89 95 and renovated (No.) Area with improved inter-farm 4000 0 800 711 4800 and on-farm I&D systems (ha) Component Two : Lengths of reservoir side 38 3.26 5.065 4.89 10.2 embankments rehabilitated (km) Urgent dam safety measures 100 None None (New New defined and taken, reservoir indicator) indicator volumes determined and achieved at inflow/outflow gauging systems 100% installed and operational (% completed) Yearly reservoir storage and 4 0 4 3 6 flow assessments, and real-time application of measurements in reservoir operations (Twice yearly reports) Component Three: Demonstration held and new 10 8 10 15 40 cultivation or cropping technologies adopted (No.) Legally registered and 1 3 3 3 3 functioning WUA operating system Routine soil/water sample 5 0 2 3 7 report (No.) ** Indicator added at MTR.

Component 1: Irrigation and Drainage System Rehabilitation and Improvements • Selected infrastructure systems brought back to operational condition as per requirement for the command areas served by the systems

This component was to finance the design and works on repairing and rehabilitating pumping and gravity I&D systems serving 30,000 hectares of farmlands in Kannibodom and Gafurov districts. 28 The planned works included: rehabilitation of selected sections of the Big Ferghana canal (BFC) and the Kannibodom Concrete Canal (KCC), rehabilitation of vertical drainage wells (VDW), rehabilitation of drainage pump stations (DPS), rehabilitation of the Mahram irrigation pump station, rehabilitation of the inter-farm collectors, and improvement of on-farm and inter-farm irrigation and drainage networks.

Component 1: Output Indicators and Results Achieved

Results Indicator Target Actual % Baseline at AF Achieved achieved at AF Lengths of main irrigation BFC canals 11 11.36 103.2 2.5 repaired/lined (km) BFC irrigation structures rehabilitated (no.) 160 161 100.6 150 Lengths of main and secondary drains 120 117.6 98.0 62 rehabilitated (km) I&D pumping station systems rehabilitated 9 10 111.1 4 (no.) I&D tube-wells rehabilitated and renovated 118 110 93.2 38 (no.) Observation wells rehabilitated and renovated 95 97 102.1 75 (no.) Area with improved inter-farm and on-farm 4800 4800 100.0 800 I&D systems (ha)

Outputs under Component 1 allowed attaining the key project result of reducing flooded and waterlogged land areas in the zone of the project near the embankments, and the area on which effective irrigation has been renewed. These results were achieved by cleaning the basic collectors and drains, rehabilitating and repairing I&D off-farm and on-farm infrastructures. The term “ameliorative condition of the irrigated lands”, which is widely used in Tajikistan means a combination of level and mineralization of sub-surface waters and the degree of salinization of the irrigated lands usually in a meter layer of soil. Cleaning of collectors and drains allows maintaining the sub surface waters at admissible level and provides carrying out of all field works in the best agro technical terms, positively influencing productivity of agricultural crops. Also cleaning promotes increase

28 The project area is sub-divided into three project sub districts and includes 6 jamoats in Kannibodom district and 3 jamoats in Gafurov district. The three sub-districts cover irrigated areas of about 19,000 hectares (of Kannibodom district), 4,000 hectares (conditionally marked as Western Kannibodom), and 7,000 hectares (Gafurov district). See M&E Report, 2014, p. 36 for the population in each of these sub-districts.

of filtration speed of excessive soil water in drains and collectors, thereby accelerating the removal of harmful salts from the root layer. Thus, ultimate benefit from cleaning of drains and collectors is the stable maintenance of the irrigated lands in the best ameliorative condition and the creation of favorable water-air and salt modes of soils for cultivation of agricultural crops. This benefit is expressed in the area with the improved ameliorative condition.

According to design data, as a result of cleaning of CDN level of sub surface waters has gone down from 1.4 to 1.0 meter. The area of improved ameliorative condition (IAC) in Kannibodom and Gafurov districts amount to 3850 and 2400 hectares respectively. In total, the areas with IAC from cleaning of CDN on all project territory equal 6250 hectares.

To decrease the level of subsurface waters and water logging of lands, the project supported: • repair and cleaning of the main and secondary off-farm collectors (117.61 km); • repair and rehabilitation of drainage and irrigation pump stations (10); • repair and rehabilitation of tube wells of vertical drainage (110); and • rehabilitation of tube wells for monitoring the level and quality of underground waters (97).

To reduce water losses from canals, and improve the water security of lands, the works performed included: • lining of selections sections of BFC (11.36 km); • repair and rehabilitation of the structures on the BFC canal (161), which helps to promote improved water resource management; • the area with advanced off-farm and on-farm I&D systems (4,800 ha); and • rehabilitation of the Kannibodom Concrete Canal (13.01 km, that is 100 percent achievement of the target). The detailed designs of all the rehabilitation works were completed.

Rehabilitation of vertical drainage wells (VDWs). VDWs have great value in decreasing the level of sub surface waters and capturing deep water streams flowing from adjoining territories. The project helped to rehabilitate 110 vertical wells (81 in Kannibodom district and 29 in Gafurov district) that are used for drainage of deep underground waters. In most cases drainage waters of these wells are used for irrigation of agricultural crops. Rehabilitation of wells allowed improving drainage of 2462 hectares of land (1871 hectares in Kannibodom district and 591 hectares in Gafurov district).

Rehabilitation of drainage pumping stations (Horizontal-1, Horizontal-2, Novostroyka, D-1, Yakkaterak, D-4, D-5, D-6 and D-7). Drainage pumping stations are intended for pumping out of drainage waters into the Kayrakkum water reservoir. (See Draft M&E Report, 2014, p. 62-65 for details of volumes and repair/rehabilitation works of the drainage pumping stations.) The total area served by the drainage pumping stations is 6705 hectares. As a result of rehabilitation of drainage pumping stations, 3520

hectares have been provided protection from inundation and flooding in Kannibodom district (2330 hectares) and in Gafurov district (1200 hectares). This is 100 percent achievement of the project’s first outcome or key performance indicator.

Irrigational pumping station Mahram-1. Pumping station Mahram-1 was constructed in 1975 for improving the provision of irrigation water for the lands of the east part of Kannibodom district, an area of about 4000 hectares. There are 8 pumping units in the pumping station, out of which 6 are of high pressure and 2 are of low pressure. The total discharge of all units constitutes 12 m3/sec., and the capacity is 11600 kwt/h. Water is conveyed by means of three lines of the pipelines, two of which convey water to the BFC and one to Mahram-1.

The pumping station takes water from the Kayrakkum water reservoir and conveys it to the Big Ferghana Canal (M&E Report, p. 67). The design irrigated area equals 3500 hectares, but the actual command area constitutes about 4000 hectares of the lands. These are the areas of WUA Dehkan and WUA Mirzomalik, also the areas of private homestead land plots and the areas that are irrigated above the canal BFC by means of private small pumping units. The project supported major volumes of works in the station including replacement of 3 pumps and repair of 3 pumps, repair of electric drives of valves, replacement of 3 metal dam beams, and general construction works in the building of pumping station.

Due to depreciation of pumping units, the system of electrical supply, and the hydro mechanical and power equipment, the pumping station worked at about half of its capacity, i.e. provided effective irrigation for about 2000 hectares of the lands. As a result of rehabilitation of 6 pumping units of high pressure and 2 units of low pressure, and also replacements of electrical and the mechanical equipment, the pumping station has reached 100 percent of designed capacity, i.e. 4000 hectares provided with water on a sustainable basis.

Concreting and rehabilitation of water outlet structures of the Big Ferghana Canal. The Big Ferghana Canal (BFC), which was constructed in 1939-40 with assistance from about 160,000 collective farmers, was one of the largest irrigational structures of the USSR. The Canal originates from the basic source of Syr-Darya River, near Uchkurgan and came to an end near the city of Khujand. It was later extended another 48 km. Total length of the Canal is 393 km, which pass across the territory of Uzbekistan (283 km) and across Tajikistan (110 km). The command area of BFC within the territory of the Kannibodom State water Management Department (KSWMD) is 15,200 hectares.

The lower part of the Canal is in the eastern part of Kannibodom and the initial part of the Canal is in the Western part of Kannibodom. All of the canal is in the territory of Gafurov district, and has concrete lining. Large losses of water were observed along the unlined sections of the Canal in the western part of Kannibodom where the Canal passes through the sediments of the detrital cone. Along the Canal, in the territory of Kannibodom district, there are 102 water outlets, which were in a poor condition and allowed large technical losses of water. Canal BFC is additionally fed by waters of the

river Isfara by means of the KCC and the Canal Chor Arik, which head water intake structures begin from the hydro unit of Ravat. Besides, water is fed to the Canal by pumping station Mahram-1, on the border of Western Kannibodom and Khojabakirgan in the territory of Gafurov district.

At the stage of detailed designing, based on a study of the results of soils water penetration in the bed of the Canal, taking into account change of the prices and in coordination with Kannibodom Hukumat and Kannibodom Water Management Department, it was decided to conduct lining of the Canal on an extent of 11,349 m. This site is the continuation of the lined part of the Canal in western Kannibodom. In addition, water outlets on BFC were done. The project in total contracted to complete concrete lining of chosen sections of BFC on an extent of 11,361 km.

Specifically for rehabilitation of structures on BFC, under a single contract, the project fully repaired 80 water outlets and 33 hydrometers. In each water outlet, flat sliding gates, frames, lifting screws, and concrete parts have been replaced, and the metal diaphragms with a designed aperture in conformity of its irrigated area have been installed. The total quantity of the rehabilitated structures under this one Contract was 113. Within the limits of other contracts, 48 structures on BFC were also rehabilitated. Thus, in all on BFC 161 structures were rehabilitated, including water outlets (104), hydrometers (49), hydro bridges (6), and one water measuring post and one mud flow discharge over the Canal.

The project also reconstructed storm overflows to protect BFC against mud storm flows. These works included dismantling of concrete and RCC elements of the storm- overflow sewer, their use for strengthening of downstream structures and use of metal pipes in diameter of 2200 mm as an aqueduct over the canal for conveying storm and mud flows.

Other outputs under Component 1 included the following. These resulted in positive outcomes: Reduction of losses of water from filtration from the concreted section of BFC. Water leakage was high on an extent of about 17.55 km in the zone of WUA Mirzomalik. According to a report, the loss of water on this section reached about 35 percent (i.e. canal efficiency of 65 percent). Through concreting this section of BFC for water for irrigation of about 60 percent of all territory of WUAs or about 2,000 hectares, according to practical gauging done by the District Water Management Agency, the water efficiency was increased from 58 percent to 78 percent. This gauging also testifies to reducing losses of water.

Reduction of losses of water from rehabilitated water outlets of BFC. On this Canal, 104 water outlets were rehabilitated, which allowed to reduce technical losses of water. Precisely measured data on technical losses are not available, however according to expert evaluations of the Kannibodom Water Management Department, the value of technical losses from structures before their rehabilitation reached 25 percent from the water intake volume, and after rehabilitation these losses have been reduced by 80

percent. Prior to rehabilitation, annual technical losses of water from water outlets in 2012-2013 amounted to about 27 to 33 million m3. After rehabilitation, this decreased to 5.4 to 6.6 million m3. These figures are confirmed by the analysis of change of losses of water on canal BFC. Comparison of water loss on the average for 2006-2009, when active interventions in the canal were not conducted, and for 2010-2013 when structures had already been partially rehabilitated and the canal also was concreted, show on them reducing by 12 million m3 along all of the Canal, and on the section of command area of PS Mahram by 4 million m3.

Increase in Canal discharge capacity through rehabilitation of Kannibodom Concrete Canal (KCC). The KCC joins BFC in the medium part of its command zone in Kannibodom district. The canal is intended to feed into BFC from the river Isfara waters when water delivery from Uzbekistan in BFC reaches a minimum (from mid-June) and the farms located below crossing of the KCC with BFC lacks water. For reliable provision of the farms, located below crossing of the KCC with BFC, its’ designed throughput capacity should be approximately 17 m3/s. Due to strong speeds of water in the canal some sections of the canal were badly damaged and structures needed rehabilitation and cleaning, and to increase the discharge of the canal, it was necessary to increase its boards. According to the information provided by the Kannibodom State Water Management, before rehabilitation the Canal capacity for discharge to BFC was only 10 m3/seconds.

The following activities were executed to increase the discharge of the Canal: • Sedimentation basin cleaning on the unit Ravot (17700 m3); • Rehabilitation of 5 water outlets; • Repair of 6 gates on the hydro unit Mahram (located on the western suburb of Kannibodom); • Rehabilitation water extinguisher and a spillway; • Laying of concrete of mark М250 in volume 1370 m3 on the destroyed bottom and slopes of the Canal with reinforcing by mesh of Diameter 6 mm, the size 200Х200 mm and escalating of boards of the Canal for length of 750 meters.

Presently the canal discharge capacity is about 15 m3/s., or by 1.5 times greater than it was before rehabilitation. Rehabilitation of KCC has allowed KSWMD to increase the share of water delivery of the district on account of waters of the river Isfara from 31 percent to 53 percent. It has provided to lower the influence of decreased inflow of BFC from Uzbekistan for irrigation needs of lands by almost 29 percent. It is possible to assert that KCC has provided increases in water security of the sub command zone of BFC on the area of 11,200 hectares (in total, the sub command zone of BFC including PS Mahram 1 is 15200 hectares).

Benefits from rehabilitation of on-farm I&D infrastructure of WUAs. On-farm I&D infrastructure was rehabilitated on the area of 4800 hectares in WUAs Mirzomalik and Kavsari Kandy Kuhan of Kannibodom district for the purpose of improving water resources management and reducing of water loss. The water savings and efficiency improvements are provided basically by construction of a new pipeline network that

allows reducing water losses during its transportation to irrigation fields. Moreover, these pipelines provide water for the fields that are located below a highway and which suffers most from the shortage of water.

In total 11 on-farm sprinklers of WUA Mirzomalik were rehabilitated. Their general length is 10,249 m, and the area where water security will be improved is 1086 hectares. In WUA KKK, sprinklers КР 1 in length of 3320 meters with diameter of polyethylene pipes 450mm and КР 4 in length 1805 m with diameter of polyethylene pipes 500 mm have been rehabilitated. The area of improvement of water supply in all makes 765 hectares (sprinkler КР1 improves water supply of 500 hectares, and sprinkler КР 4 of 265 hectares).

Before construction of pipelines efficiency of the on-farm network, which is located on the line with high water penetration, did not exceed 0.6, i.e. losses constituted about 40 percent from volume of the taken away water. The Efficiency of the pipeline network approximately equals 0.95, i.e. losses constitute no more than 5 percent from water intake volume. Overall, the constructed network of pipelines allows preserving about 6.3 million m3 waters that will be directed for improvement of water security of crops in WUAs.

Component 2: Strengthening Kayrakkum Reservoir Dykes and Improvement of Kayrakkum Dam Safety and Reservoir Operation

• Select reservoir embankment sections rehabilitated and dam and reservoir safety measures and operational performance improved

This component was to finance: (i) design and rehabilitation works of the Kayrakkum Reservoir embankments in Kannibodom and Bobojon Gafurov raions; and (ii) technical studies, dredging and other equipment and installation, and minor works, to increase operational performance and improve management of the Kayrakkum Dam and Reservoir, to improve dam safety, and to develop dam and reservoir emergency procedures. The Additional Financing was to support the strengthening of the early warning system of the Kayrakkum dam as well as the carrying out of a geotechnical study for risk assessment purposes.

Component 2: Output Indicators and Results Achieved:

Results Indicator Target at Actual Achieved % Baseline AF at AF Achieved Lengths of reservoir side 10.20 9.14 89.6 3.2 embankments rehabilitated (km) Urgent dam safety measures 100 100 percent 100 80 percent defined and taken, reservoir percent complete volumes determined, and completed inflow/outflow gauging

systems installed and operational Geo-technical investigation 100 Not achieved. To None. Not None. completed (action plan) percent be completed achieved At AF, the draft completed under the EBRD geotechnical project investigation reports were available. Early Warning System 100 100 percent 100 75 operational (Completed) percent completed completed Yearly reservoir storage and 6 6** 100 At AF, flow assessments and real-time estimated as 4 application of measurements times in reservoir operations (twice yearly reports) ** Forecasts are currently provided by the Scientific-Information Center of the Water Commission; the data can be also found on www.cawater-info.net. Data are updated quarterly.

Outputs realized under Component 1 above provided reduction of the flooded and bogged up land areas in the zone of the project near the embankments in Kannibodom and Gafurov districts. These outputs together with outputs achieved under Component 2 have essentially helped to improve the management of the water reservoir; decrease the risk of breach of Kayrakkum Dam and its consequences for the population living in lower reaches of the Dam, by working out the procedures for operation of the Dam in the event of a major force.

These achievements were a result of the following executed works for:29 • Rehabilitation of river side embankments of the Kayrakkum water reservoir in Gafurov and Kannibodom districts; • Improvement of safety of the Dam by strengthening of the upper slope of the Dam, improvement of drainage of the Dam by means of installation of new deep pumps and rehabilitation of drainage of the downstream slope of the Dam; • Specification of sediments’ volumes in the water reservoir, which allows to improve its operation at water use planning; • Working out and realization of an action plan on the Dam in an occurrence of extreme situations; and • Working out, installation and introduction into operation of Early Warning System (EWS) of the population.

Rehabilitation of Bank Strengthening Embankments As a result of the rehabilitation works, 6656 meters of embankments of Novostroyka and Yakkaterak in Kannibodom district have been strengthened. In Gafurov

29 See the M&E Draft Report, 2014, p. 86-87 for a detailed description of the works executed under this Component.

district, 2045 meters of embankments of Horizontal 1 and Horizontal 2 have been strengthened.

The basic scope of works for rehabilitation of embankments included the following items: • Rehabilitation of auxiliary access roads to the embankments; • Transportation, embankment, consolidation of loam and pebble soils and leveling of surfaces of the embankments according to drawings; • Formation of protective bed out of pebble soil in the thickness of 30 cm ; • Pitching and packing of the large-sized imported and old stone used in the body of the destroyed embankment; • Removal of a vegetative layer from the crest of the embankment; • Gravel and pebble covering of the crest of the embankments.

Calculations and design of the cross-section of a profile of the embankment, strengthening of its slopes have been executed according to the existing norms and rules, and the drawings with use of soft program of Auto CAD. The design documentation of this type allows performing all works of construction and repair of the embankments on a qualitative level.

Protection of lands against flooding. The rehabilitated embankments in Kannibodom district provide protection of the river side lands on an area of 666 hectares, and in Gafurov on an area of 520 hectares. Size of the protected area depends on the slope of lands near to embankments. The higher the slope, the lower the area. In Kannibodom district, on average, 1 km of the rehabilitated embankment corresponds to 100 hectares of the protected lands from flooding. In Gafurov district 1 km of the rehabilitated embankment allows for almost 2.5 times greater area of protected lands.

Improvements of water reservoir management and decrease in risk of breach of Kayrakkum Dam. Improvement of water reservoir management and decrease in risk of breach of Kayrakkum Dam is a very difficult and multi-sided issue, and demands a special approach for its solution. It includes carrying out deep field and analytical research, workings out the actions for safety of the Dam and their realization, in terms of the kind of services, procurement of goods and performance of works required. The analysis and development of materials for improving the management of the water reservoir and for decreasing the risk of breach of the Kayrakkum Dam has been carried out, with the objectives of: (i) defining the defects (structural and non-structural) of the Dam and Kayrakkum hydro unit, and the risk degree, connected with these defects; and (2) the prospective rehabilitation actions needed and the costs of these actions.

The project selected the Consulting Company Temelsu (Turkey) in association with the Mot McDonald Company (Great Britain) to conduct this research. The Contract was signed on July, 21st, 2008 for a period of 8 months. The Contract was completed in 2009. A final report on “Consulting services for improvement of safety and operation of Kayrakkum embankments and water reservoirs” in two volumes has been submitted to PMU. The expert notes that for the purpose of decreasing the risk of destruction of the

Dam, it is necessary to hold the water level in the water reservoir on lower elevation marks and urgently carry out the works on the first priority basis.30

“The plan of readiness for emergencies of the Kayrakkum embankment”, which includes classification of levels of emergencies and the basic practical recommendations on realization of concrete actions at their occurrence, have been transferred to HPP and other stakeholders. The basic conclusions of the Consultant based on results of the executed works and assessment of their activities by the Panel of Experts are given in the M&E Draft Report, p. 92.

Stability of the Dam. The dynamic characteristic and seismic safety of the Dam are defined by use of the best assessed structural properties of materials of construction and soil of the basis based on limited accessible data and results of geotechnical research at the first stage. Results of evaluation of these seismic studies have shown that the Dam is rather vulnerable to strong earthquakes, especially for levels of the Maximum design earthquake and the Maximum Rated Earthquake. The destruction and loss as a result of destruction of the Dam appear as catastrophic, with secondary influences extending to the territory outside the flooding zone. The impact connected with the lack of water for irrigation extends to the essential distances downstream in the territory or Uzbekistan and Kazakhstan.

Preliminary conclusions indicate that the safety of the Dam can be preserved by: • Strengthening and restoration of the downstream and upstream prisms to the initial condition; • Reduction of levels of subsurface waters within the Dam body on the lower side current flow; • Construction of stone pylons on the upper prism for discharge of surplus of porous pressure which rise to admissible level during the seismic activation.

However, the Consultant together with the Group of experts considers it necessary to carry out all-round geotechnical studies for assessment of seismic safety and detailed design studying. The Project has agreed with an EBRD project to carry out these detailed studies.

Early Warning System (EWS). A key project output is the Consultant’s plan that offers an early warning system in Kayrakkum Hydro Unit in case of occurrence of the high waters. This is in three parts: (i) forecast and threat assessment; (ii) dissemination of the information and instructions for operative actions; and (iii) fulfillment of the instructions for operative actions. The plan of readiness for the emergencies provides a basis for assessment of threat, dissemination of the information and corresponding actions during an emergency situation.

30 See M&E Draft Report, p. 92, and Temelsu, Mott MacDonald. Final report, “Consulting services for improvement of safety and operation of Kayrakkum embankment and water reservoir”, Volume 1 and 2, December, 2009.

Reaction to instructions. The EWS and plans of readiness for emergencies are inefficient if the population does not react in an appropriate way to the instruction given. For this reason, programs for training the population living in the flooded zone of risk, caused by potential break of the Dam, and corresponding actions that should be undertaken, in case of the warning about such phenomenon are required. These issues also are assigned to the Consultant for working out and introduction of the EWS.

Plan of readiness for emergencies. The Consultant has prepared a Plan of readiness for emergencies for the location of the Dam and out of the Dam location. However, such readiness is connected not only with the Ministry of Land Reclamation and Water Resources. The main responsibility for readiness to any case and acceptance of necessary measures is born by Committee of Emergency Situations. Besides, Barqi Tojik the Administrations- Hukumats of Khujand also are the responsible parties. Therefore such readiness should be organized under the supervision of Committee of Emergency Situations. If some other components of this project are connected with Readiness for Emergencies in the future it is offered that such component should be copied by a Committee established with participation of all governmental parties. If it is possible, this Committee can be engaged in creation of an Integrated Early Warning System that requires coordination with other neighboring countries.

Component 3: Institutional Development and Technical Assistance

• Functional and capable Institutions for effective management of I&D systems, strong support for achieving high agricultural productivity, and sound environmental monitoring and management

The primary objectives of the Component were: (i) establishment of WUAs; (ii) improvement of agricultural efficiency and achievement of a more rational system of use of water; and (iii) warranting of acceptance of corresponding measures for reduction of impact on environment.

Component 3: Output Indicators and Results Achieved:

Results Indicator Target Actual % Baseline at AF Achieved achieved at AF Demonstrations held (No.) and new 40 49 122.5 4 cultivation or cropping technologies adopted Routine soil/water sample reports (No.) 7 7 140 5

Establishment and support of WUAs. The project worked with the three pilot WUAs in the project area. These were: Kavsari Kandi Kuhan (KKK), Mirzomalik and Dehkan. Specifically, the project provided training and hands-on assistance in the organization of mechanized and manual cleaning of I&D canals, development of business plans, M&E of WUA activities, and taxation of WUAs. The WUA Directors and accountants were trained in cost recovery, calculation of membership fees, and preparation of budgets. In addition, the project renovated offices of the WUAs, procured

office equipment and furniture, water measurement devices, as well as procured some machinery.31

The Project supported the following outputs: A Campaign for awareness of the population of pilot districts on the purposes and tasks of FVWRMP, where 78 meetings were held in which 1,535 persons from various levels of population (heads of districts and the organizations of rural and water management, heads of Dehkan farms, Dehkans, water users and others) participated; • In the second phase of support of WUAs, three WUAs were created, providing O&M of the irrigational system at off-farm (field) level on an area of 6,426 hectares or about 43 percent from served area of BFC; • Trainings for various level of management of irrigating systems for 630 persons; conducted; • The computer program, “Plan-v” for water use scheduling at level of WUAs Mirzomalik, KKK and for all BFC has been created and transferred for operation. The plan is executed on an Excel program and contains the basic information on modes of irrigation of agricultural crops and data on canals of various levels. Instructions for use of soft program were developed and trainings of experts of WUAs were carried out; • A dredge-loader, a tractor МТЗ-82, a trailer tractor, a diesel engine-generator, and a welding machine were provided to promote maintenance of I&D system; • Documents prepared on perfection of contractual system between Raivodkhoz, WUAs and Dehkan farms for providing members of WUAs with water, solution of issues of taxation of WUAs, conditions and terms for transfer and use of the state property; • Computer equipment, accounting, geodetic devices and bicycles, which allow WUAs to improve the system of planning of water use and reporting, and to execute actions for estimating for performance of repair works, gaugings of water and its distribution have been transferred to balance of all three WUAs; • A Public Council (Fund) of the BFC, as a structure of participation of key interested parties in democratic management and fair distribution of water at canal level was established; and • Major repairs carried out on offices of WUA Mirzomalik and KKK.

Improvement of agricultural efficiency and achievement of more rational system of use of water Outputs include the following: • Reform of Dehkan Farms in the territory of WUA Mirzomalik, which resulted in the creation of 507 new Dehkan Farms instead of 24 large ones. In addition, the PIU has provided an information campaign in WUA KKK where 973 Dehkan Farms were created;

31 See M&E Draft Report, 2014, p. 112 for details on all contracts/activities completed.

• Active works on training, display, publication and distribution of results of demonstrations to promote the introduction of new varieties of crops and technologies on almost 19,000 hectares; • Over 2008-2012, a total of 57 demonstrations in 29 Dehkan Farms under pilot territories were conducted. These demonstrations covered an area of 62.8 hectares. Basically demonstrations addressed the following topics: reception and distributions of seeds of high-yielding varieties of cotton, the use of the bared seeds of cotton, exact sowing time, cultivation of selected saplings of stone and seed varieties, new technologies of inoculation, mulching of row-spacing, drip irrigation of cotton, young garden, nursery, tomatoes, sweet pepper and cucumbers, the distribution of high- yielding varieties of corn, vegetable and fruit crops, distribution of new sub-film technologies of cultivation of early crops of cucumbers, and distribution of cultivation of carrots (new crops); • On demonstration plots, the productivity of agricultural crops was about 24 to 57 percent higher than on control sites, and profitability of producing cotton is about 13 to 15 percent, vegetable crops had profitability of 44-125 percent, and grains, 23 to 29 percent. • In 2012, the Consultant executed numerous scope of works demonstrating water saving technologies, and as a result considerable savings of irrigating norm (4-38 percent) and reduction in water consumption for gaining of unit of crop from 26 to 177 percent have been achieved. • Trainings were conducted to cover more than 10,000 persons, out of which 4,400 were women. • Results of demonstrations have been published in the form of brochures, recommendations and booklets, which were distributed to participants of trainings and Dehkan Farms.

Mitigation of impact on the environment For the dissemination of information, two round tables (July 12, 2008 and July 30, 2010) were conducted for acquainting interested participants and beneficiaries on the environmental component of the Project, and its tasks and planned actions. Representatives of PMU, nature protection department, regional and district departments of water management, the sanitary-and-epidemiologic control units, NGOs, representatives of executive power and managements of agriculture of pilot districts participated in these round tables; • Training modules on various aspects of preservation of the environment were prepared. Two two-day trainings for employees of the analytical laboratory of the control and preservation of the environment of Sogd regional committee were trained on techniques of definition of quality of water using the equipment provided under FVWRMP; • At the end of May and in the beginning of September, 2009, in districts of Gafurov and Kannibodom, training and information campaigns were conducted where 1,200 persons took part. Trainings dealt with subjects such as methods of rational water and land use, recycling of waste, use of fertilizers and other aspects of preservation of the environment. Booklets and books on various aspects of ecological education were distributed to the participants;

• Special studies were carried out in selected pilot districts on subjects of social and economic issues, legislative and legal aspects, quality of water, the biodiversity preservations, the existing ameliorative condition, and assessment of water security of the irrigated lands; • GiS-mapping of results of analytical studies on radiating pollution in the project zone was carried out, and gaugings of radiating conditions were executed by means of special equipment. Researches of salinity of soils on the Project areas were also conducted. • Trainings on rational use of water (methods of irrigation, reduction of losses, and choice of agricultural crops), service regulations and maintenance of the rehabilitated irrigational structures after the project’s life time, preservation and protection of water resources, national, regional and international standards of environment and requirements for reception of permissions, licenses, contracts, etc. were conducted. • Assistance to carrying out monitoring of environment on the chosen parameters. Sampling and the analysis of superficial waters from 10 selected points (superficial waters), 4 selected points of subsurface waters - once a quarter for monitoring of influence of rehabilitation works carried out by the Project; • Consulting services to beneficiary concerning preservation of the environment with regard to technical, informative and institutional character were rendered; • A detailed report containing assessment of the existing condition of water use, operation of irrigating systems were prepared and actions for water savings and service regulations of irrigating systems were offered; and • Preparation of TV materials, rollers and reports on activities related to water resources management of Ferghana valley, including ecological aspects was broadcast on Sogd TV.

The project has also contributed to the following: Ensuring of increase of collecting of membership fees in WUAs. The size of membership fees is defined at the time of drawing up the WUA budget, and approved by general meeting. The project supported activities to explain to farmers about timely payment of membership fees that would be used to ensure WUA activities. Based on the results for 2013, the rate of collection of membership fees on average has increased to 99.9 percent (Mirzomalik 99.5 percent, KKK 100 percent, and Dehkan 100.3 percent). This compares with the averages of 39.6 percent in 2011 and 66 percent in 2012.

Solution of problems of taxes on property transferred to balance sheet of WUAs. To resolve this issue, the PMU has employed a Consultant – lawyer, who has presented a format of the tripartite contract between WUA, Raivodkhoz and Dehkan farms, avoiding payments of the VAT, contracts about transfers of the state property to the balance sheet of WUAs and explanations regarding the taxation of property of WUAs. The report with the offers has been sent to PIU, WUA and Raivodkhoz for discussion and use.

Annex 3. Economic and Financial Analysis32

1. Introduction For the economic and financial analysis, several data sources were used. These include: • Final report of Monitoring and Evaluation of the results of FVWRMP implementation, Dushanbe, May 2014; • Results of Interviews with farmers, Sugd Oblast Department of Agency of Land Reclamation and Irrigation and Sugd oblast Department of Agriculture; • Regions of Tajikistan, 2012. Report of Statistical Agency under President of the Republic of Tajikistan. The project interventions are concentrated in Kannibodom and Bobojon Gafurov raions, with an irrigated area of about 30,000 ha. About 231,000 people live in these rural areas. The irrigation and drainage infrastructure in these raions has both physical as well as operational problems. The result is an unsatisfactory utilization of water resources and low productivity at farm level.

The actual scope of the planned works was reduced due to (i) higher work and input prices and (ii) omitted details in initial calculations. On 21 March 2010, the Bank and the GoT agreed on an additional financing of the project in the amount of US$10Mln. The date of completion was planned for 31 May 2013, but was extended until 31 May 2014.

2. Financial and economic analysis

2.1 Main assumptions

Project area and cropping pattern

The project covers an irrigated area of 29,874 ha (2013), of which 6,685 ha are located in Bobojon Gafurov raion and 23,188 ha in Kannibodom raion. There is no significant difference between the present cropping patterns in both regions. The composition is presented in Figure 1. The dominating crops are orchards and cotton respectively with 36% and 32% of the total area. The cotton area decreased significantly during the last years due to decreasing of price to fiber cotton in the world market. Orchards include different fruit trees such as apricot, peach, pomegranate and others. These are followed by cereals, including mainly wheat, oats and sorghum with 12.5%. Fodder crops (alfalfa, maize, including for silage) are grown on 1,194 ha (corresponding to 4%). Others crops cover 9.5% of total irrigated area and include rice, potato, grapes and others crops. Except orchards, future cropping patterns will depend on market demand and profitability of the crops.

32 The pre-project economic and financial analysis was conducted by Temelsu Company. The current economic and financial analysis was conducted by Kamolidinov Anvar.

Figure 1: Cropping pattern (with project interventions)

40% 36% 32% 30% 20% 13% 9% 10% 5% 4% 0%

Project impacts at farm level

The various project components resulted in improving of production conditions at the farm level. This means an improved irrigation water delivery and a reduction of the problems caused by flooding and high groundwater levels from Kayrakkum reservoir. An agricultural extension service and a farm management information system established by the project further improved the water and land management in irrigated farms.

Due to the rehabilitation of the drainage network and drainage pump stations, the groundwater table decreased on a total area of 6,416 hectares, including in Kannibodom district (on the area of 4,755 hectares), and in Bobojon Gafurov district (on an area of 1,661 hectares). An improvement of the drainage collection system allowed control of soil salinity, increased crop yield and thus raised the profitability of irrigated farming in the area close to the Kayrakkum reservoir. Rehabilitation of the Mahram-1 pump station, and concrete lining of the Big Ferghana Canal improved water supply to farms. A better water supply resulted in higher yields for all crops in the project area.

Training on the improvement of agricultural productivity and a more rational water management have been conducted for more than 10,000 persons, out of which 4,400 were women. Results of demonstrations of advanced agriculture and irrigation technologies have been published in the form of brochures, recommendations and booklets, which were distributed to participants of the training.

As compared to the beginning of the project (2006), vegetables, forage and orchards yields increased to 10-20%, although yields of rice and wheat remained stable (Table 1). This suggests that farmers still have a potential to increase yield of these crops.

In Table 2 the impacts of all project interventions with regard to incremental yields, gross output and costs are summarized for relevant crops. Crop budgets were calculated for 4 major crops: apricot, cotton, wheat, alfalfa and vegetables. The highest incremental gross output was achieved for cotton, apricot and vegetables. However, since the highest share of the irrigated land is cultivated with fruits, it will provide the largest absolute contribution to the project benefits.

Тable 1. Increase of crops yields in dehkan farms according the survey conducted in 2013 comparatively to 2006 Increase of yield of crops, % to 2006

Fruits, including Raw cotton Cereals Vegetables Forage apricot

23.5 9.6 14 14 11.7

Table 2: Project interventions and incremental harvested quantities, gross output and costs Additional Yield, ton/ha Yield incremental cost of Cost of harvesting Total increment Crops and addition Profit, Average al yield, ton/ha transporta al cost, US$/ha 2006 2010- % US$ tion, US$ 2013 US$/ton

Cotton 1.94 2.33 0.39 23.51 27333 120 46.8 226.2 Wheat 2.55 2.77 0.19 9.57 5734 60 11.4 45.6 Vegetables 21.10 24.03 2.93 13.89 29335 40 117.2 175.8 Orchards 36 4.49 5.11 0.63 13.93 630 100 63 567 (dried fruits) Forage (hay) 7.51 8.39 0.88 11.66 8837 30 26.4 61.6

Accurately measured data on technical water losses are not available. However, according to expert evaluations of the head of the department of water use of Kannibodom Water Management Department, the value of technical losses from structures before their rehabilitation reached 25% from the water intake volume, and after rehabilitation these losses have been reduced to 20%.

Although the costs of irrigation water delivery for the farmer are not high, reducing losses in the canals and fields will have a positive impact to improving the condition of the irrigated lands, and decreases the pressure on the drainage networks. According to this, annual technical losses of water from water outlets constituted 27 million m3 in 2012 and 33 million m3 in 2013. After rehabilitation they decreased to 5.4 – 6.6 million m3, representing a reduction of losses of 21.6 to 26.4 million m3 annually.

33 1 ton raw cotton 700US$ (sale price) 34 1 ton wheat 300 US$ 35 1ton vegetables 100 US$ 36 1 ton apricot 1000 US$ 37 1 ton hay 100 US$

Input and output prices

Input and output prices are expressed in constant 2013 values (US$). Financial prices are based on actual market prices. For the economic analysis, costs and benefits are adjusted to reflect the real value in the economy. The border prices are estimated for all crops, including fodder crops derived from the farm gate prices.

Table 3: Expenditures and income of agriculture production for main crops, 2013 Unit Land Production Net Yield gross Tax Profit Crop expenditures income income t/ha US$/ha US$/ha US$/ha US$/ha US$/ha Cotton1 2 1600 700 900 40 860 Wheat 2 600 250 350 40 310 Potato 20 6000 2500 3500 40 3460 Rice 2.5 1500 600 900 40 860 Fruits 5 5000 1000 4000 40 3960 Lucerne 15 1500 417 1083 40 1146 Melon, 40 10 4000 1500 2500 2460 watermelon 1Gross income of cotton includes price of cotton stalks used by rural population as fuel.

2.2 Financial and economic results

The cost and benefits streams and the cash flow calculations were completed based on the above-mentioned assumptions. The following benefits were included in the analysis (i) additional production on incremental land as a result of reduced flooding, (ii) higher yield levels as a result of better, more reliable and increased water delivery, and improved groundwater control and earlier spring planting, (iii) production of higher value crops as part of a more diversified cropping pattern, and (iv) reduced pumping costs per m3 as a result of reduced losses. Other benefits that are difficult to quantify and monetize have not been reflected in the EFA and include the (i) benefits to downstream irrigated areas in Uzbekistan and Tajikistan as a result of higher water levels in Kayrakkum reservoir, (ii) reduced damage to lands from overtopping of Kayrakkum reservoir embankments, (iii) reduced damage as a result of reduced risk of Kayrakkum dam failure and better early warning, and (iv) benefits from improved environmental management. Table 5 shows the results of the financial and economic analysis.

Table 5: Results of financial and economic analysis

Performance indicator ERR/FRR NPV

Economic analysis 24.3% US$ 28.43 million

Financial analysis 19.4% US$ 17.96 million

The economic viability of the project has been tested by estimating the economic rate of return (ERR) and the financial rate of return (FRR). The estimated ERR of the project is 24.3%, which is well in excess of the opportunity cost of capital (OCC), taken at the discount rate of 10%. The net present value (NPV) at 10% discount rate and a project period of 20 years is estimated at US$ 28.43 million.

The result is an NPV of US$ 17.96 million and an FRR of 19.4%. These performance indicators reflect the project benefits on farm level.

3. Sensitivity analysis

Sensitivity analysis has been carried out for various risks that the project may face in order to evaluate the effect on the project ERR and NPV. Table 6 gives a summary of the results.

Table 6: Results of sensitivity analysis

Scenario/Performance ERR NPV indicator Cost increase + 40% 18.7% US$ 21.05 million Decrease in product prices cotton + apricot - 5% 22.8% US$ 24.29 million cotton + apricot - 10% 21.2% US$ 20.16 million

The ERR is sensitive to variations in project costs or benefits. Increasing of the total cost of project results in a decrease of the ERR of 5.6% to 18.7%. The ERR was tested against changes in the assumptions regarding cotton and apricot prices. If the crop prices are 5% less than assumed, the ERR would be 22.8% and if crop prices are 10% less than assumed, the ERR would be 21.2%. Overall, the sensitivity analysis suggests that the project results are very robust.

Annex 4. Bank Lending and Implementation Support/Supervision Processes

(a) Task Team members Names Title Unit Lending Masood Ahmad Lead Water Resources Specialist SASDA Tijen Arin Senior Environmental Economist EASER Usaid I. El-Hanbali Consultant ECSAR Thirumangalam V. Sampath Sr. Agriculturist ECSSD Helen Z. Shahriari Sr. Social Scientist AFTCS Bekzod Shamsiev Senior Agriculture Economist ECSAR Sohaila Wali Temporary ECSEG Mahwash Wasiq Senior Operations Officer SASDA Jyldyz Wood Junior Professional Associate ECSSD Bobojon Yatimov Senior Rural Development Specialist ECSAR Supervision/ICR Roohi Abdullah Consultant MNSWA Abdulhamid Azad Sr. Irrigation Engineer SASDA Alexander Balakov Senior Procurement Specialist ECSO2 Valencia Copeland Program Assistant ECSSD Norpulat Daniyarov Sr. Financial Management Specialist ECSO3 IJsbrand H. de Jong Lead Water Resources Specialist, TTL ECSAR Usaid I. El-Hanbali Consultant ECSAR Ruxandra Maria Floroiu Senior Environmental Engineer EASER Daniel P. Gerber Rural Development Specialist ECSAR Malathi Jayawickrama Sr. Operations Officer, ICR TTL ECSAR Shodi Nazarov Financial Management Analyst ECSO3 John Otieno Ogallo Sr. Financial Management Specialist OPSOR Fasliddin Rakhimov Procurement Specialist ECSO2 Bobojon Yatimov Senior Rural Development Specialist ECSAR Jeren Kabayeva Rural Development Specialist ECSAR Farzona Mukhitdinova Operations Analyst ECSAR

(b) Staff Time and Cost Staff Time and Cost (Bank Budget Only) USD Thousands Stage of Project Cycle No. of staff weeks (including travel and consultant costs) Lending FY04 17.16 124.61 FY05 62.98 219.93

FY06 5.64 16.69 Total: 85.78 361.23 Supervision/ICR FY06 25.87 89.75 FY07 22.93 98.59 FY08 23.19 75.98 FY09 29.79 150.55 FY10 32.47 148.93 FY11 30.29 110.38 FY12 14.05 78.09 FY13 14.39 104.62 FY14 30.56 142.98 Total: 223.54 999.87

Annex 5. Beneficiary Survey Results

The PMU contracted the NGO Ehyo and Tarakkiyot to conduct an independent project impact assessment. 38 The survey included interviews with rural households, dehkan farms (DF), jamoats and local authorities in Kannibodom and B. Gafurov districts. Households were interviewed in 9 jamoats located in the project territory of two regions. These were 6 jamoats in Kannibodom district (Puloton, Patar, Ortikov, Hamroboev, Sharipov and Lohuti) and 3 jamoats in B.Gafurov district (Histevarz, Zarzamin and Ispisor). In addition secondary information and statistics were collected from the District level department of water management, WUAs, District level branches of the Committee for Environmental Protection and management of Kayrakkum HPP.

The survey covered 100 households (with 11 households on average in each project district) and 45 DFs. Unfortunately, the report omitted some questions related to several areas, including the assessment of direct and indirect project impact on agricultural productivity, the number of project beneficiaries and household income. The survey also covered households and dehkan farms in Patar and Puloton jamoats (Kannibodom), as well as Zarzamin jamoat (B. Gafurov district) where project interventions had been minimal.

The results of the survey showed the following: - 61% of the surveyed respondents reported that the project improved land condition; - 61% of the respondents reported that the project improved access to irrigation; - 61% of respondents reported about their satisfaction with timely delivery of water; - 64% of respondents reported on improved productivity following the project activities; - 34% of respondents reported that there was improved quality of drinking water.

In addition, with respect to the 45 DFs surveyed (5 DFs in average in each project district) in the project area, the results showed the following: - 58% of the surveyed DFs reported that project improved land condition; - 62% of the DFs reported that the project improved access to irrigation; - 82% of DFs reported about their satisfaction with timely delivery of water; - 91% of DFs reported about the improved productivity following the project activities.

Production of households' agricultural products in in 2006 and 2013 (in kg) Other grain- Wheat rice vegetables potato Gardens crops 2006 2013 2006 2013 2006 2013 2006 2013 2006 2013 2006 2013 15060 24180 4890 5287 1100 1200 15060 24180 4890 5287 1100 1200

The surveys states that during project implementation, the area under cotton decreased, while the share of other agricultural crops (grain crops and leguminous cultures, garden

38 Evaluation of Project FVWRMP Impact, PO Ehio-Farhang va Tarakkiyot, Khujand, April 14, 2014.

vegetables) increased. The total income of households increased from 367875 Somoni in 2006 to 1044271 Somoni in 2013, however, it is difficult to attribute this to FVWRMP.

Results of the survey of DFs are of particular interest, as DFs not only benefitted from infrastructure rehabilitation, but as members of WUAs, they were also able to provide an assessment of WUA functions. However, the survey did not pay adequate attention to the three WUAs supported by the project, but provided general feedback on all nine WUAs existing in the region.39

39 The Bank recommends that the PMU reviews the analysis of WUAs and draws more specific conclusions based on the raw data available.

Annex 6. Stakeholder Workshop Report and Results Not Applicable.

Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR

To: Mr. Khasan Aliev Acting Country Manager World Bank Country Office Republic of Tajikistan

From: Mr. S. Rakhimzoda First Deputy Minister Ministry of Energy and Water Resources Republic of Tajikistan

Ref. No. 2-1440 November 14, 2014

Dear Mr. Khasan Aliev,

Subject: Comments to the World Bank Report No. ICR00003160 “Ferghana Valley Water Resources Management Project Implementation Completion and Results Report”

The Ministry of Energy and Water Resources of the Republic of Tajikistan presents its compliments to the World Bank Tajikistan Country Office and is hereby presenting its comments to the Ferghana Valley Water Resources Management Project Implementation Completion and Results Report.

First of all, we would like to note that implementation of the project was highly important for improving the well-being of the people living in the project area, whose livelihood is directly linked with irrigated cropping and irrigation and drainage infrastructure providing their agricultural fields with irrigation water. In general, the project area covered 30,000 hectares of irrigated lands and a total of 250,000 beneficiaries.

The project also addressed the issues related to improvement of water resources management at Kayrakkum Reservoir and strengthening of dam safety and operation through rehabilitation of reservoir side embankments and conducting of technical studies. Taking this into consideration, as well as the regional importance of the Kayrakkum Reservoir for ensuring timely availability of irrigation water to the farmers of the downstream countries – Uzbekistan and Kazakhstan, the total number of beneficiaries and the value of the project outcomes will significantly increase.

Decrease of the level of underground water in the land area of 6416 hectares, protection of riparian lands against waterlogging and flooding in the area of 3530 hectares and a total of 7349 hectares of lands returned to effective irrigation should be considered as

extremely important achievements of the project. The activities implemented under project components 1-3 allowed raising the level of crop yield and increase the level of income of the local population engaged in agricultural activities by 72-107,6 percent.

In terms of shortage of arable land in Tajikistan, where there are only 0,09 hectares of arable land per person and nearly 90 percent of agricultural products are produced in these lands, this acquires greater importance, especially in the project implementation area.

One of the highly important achievements of the project in the field of improving of water resources management practices at Kayrakkum dam that has to be mentioned is conducting bathymetric surveys, which helped to obtain more accurate information on the water reservoir storage, which decreased approximately by 25% (1038,5 million m3) since its putting into operation in 1956, whereas the usable water reservoir storage reduced by 426 million m3 or by 16,4 percent. Application of these data for water consumption planning will allow avoiding shortage of water resources for irrigated lands attached to the reservoir.

Thus, the project had a substantial direct impact on poverty reduction and improvement of the well-being of people living in the project districts. The above mentioned achievements are in line with the priorities outlined in the country strategic documents on poverty reduction and improvement of the well-being of the population in Tajikistan.

In addition, the project executed major works aimed to strengthen the dam itself, prepared a dam safety management and emergency action plan, as well as improved the forecast accuracy for available reservoir storage volumes and inflow/outflow volumes that will allow avoiding shortage of water resources for the irrigated lands attached to the reservoir.

However, not all of the project components have been implemented in full volume, which is reflected in the ICR report. We agree with the authors of the report that inclusion of detailed geotechnical studies in the action plan for Component 2 was not realistic and could be considered as an oversight at the design and preparation stage as at that time it was not possible to assess precisely the scope of work and amount of financial resources required for implementation of such activities.

Nevertheless, it is worth mentioning that the original project activities and setting out of priorities for the future works under this project have laid the foundation for including of detailed geotechnical studies in the design of the new project on rehabilitation of the

Kayrakkum HPP, which is implemented with the support of the European Bank for Reconstruction and Development.

As regards, the drawbacks, rashness and not very adequate management during the project preparation, we would like to note that to our opinion they were connected with the following circumstances difficult to foresee a priori:

- The project was prepared by the well-known Turkish Company “Temelsu” that was not able to fully apply the Soviet-time methods for assessment of the scope of works and cost estimation; - The global economic crisis of 2008-2009, which negatively impacted Tajikistan’s fragile and weak economy, provoked an increase in the cost of resources in the markets. - A 50-percent rise in prices for energy resources in Tajikistan in 2010 following the introduction of customs duties by the Russian Federation.

Taking account of the positive results achieved by the project, including the improvement of agricultural productivity, positive lessons learned by the project during the dehkan farms reform (which is presently implemented in Tajikistan at a large-scale), ensuring sustainability of WUAs (this experience is already replicated in other projects, e.g. PUMP-2), strengthening of Tajikistan’s capacity in management of similar projects, as well as achievement of other goals and objectives of the project, the Ministry considers it only fair that the overall project performance rating could have been assessed as moderate or even moderately satisfactory.

The Ministry, taking into consideration the good interaction and regular joint monitoring during the project implementation period, as well as the above mentioned circumstances, assesses the performance of the World Bank and the Government of the Republic of Tajikistan under this project as moderately satisfactory.

The Ministry expresses its thankfulness to the World Bank for the invaluable support provided during the implementation of this project, which undoubtedly helped address numerous problems and promoted the improvement of the well-being of the people living in the project area, and looks forward to implementation of the next (sequel) project, which is expected to consolidate the results achieved and help address other complex problems in other regions of the country.

The Ministry of Energy and Water Resources of the Republic of Tajikistan would also like to express its sincere gratitude to the World Bank for the continued support in the implementation of other projects aimed to address socioeconomic issues in Tajikistan and

avails itself of this opportunity to renew to the World Bank Tajikistan Country Office the assurances of its high consideration.

Sincerely,

S. Rakhimzoda First Deputy Minister Ministry of Energy and Water Resources Republic of Tajikistan

Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders Not Applicable.

Annex 9. List of Supporting Documents

World Bank Documents

Aide Memoires of Implementation Support Missions, 2006 to 2014.

Appraisal Mission, Additional Financing Note, FVWRMP, March 30- April 7, 2010.

FVWRMP, A Proposal for Regional Funding, Draft, 2005. Implementation Status and Results (ISR) Reports, No. 1 to 17, 2006 to 2014.

Grant Agreement, Ferghana Valley Water Resources Management Project (FVWRMP),

Implementation Completion and Results Report Guidelines, OPCS, August 2006.

Implementation Status and Results Reports, No: 1 (01/11/2006) to No: 17 (May 13, 2014).

Project Appraisal Document, Report No: 32313-TJ, June 24, 2005.

Project Concept Note, Tajikistan, FVWRMP, 2005.

Project Information Document (PID), Appraisal Stage, Report No: AB1425, May 31, 2005.

Quality Enhancement Review for Tajikistan FVWRMP, Office Memorandum, February 11, 2005.

Restructuring Paper, January 12, 2009.

Restructuring Paper, May 25, 2010.

Restructuring Paper, February 7, 2013.