Document of The World Bank

FOR OFFMCIALUSE ONLY Public Disclosure Authorized

MICROFICHE COPY

Report No. 10461-PAK Type: (SAR) AHMAD, M. / X82126 / E9 018/ 'A3AG

STAFF APPRAISAL REPORT Public Disclosure Authorized

PAKISTAN

FORDWAH EASTERN SADIQIA (SOUTH) IRRIGATION AND DRAINAGE PROJECT

JUNE 11, 1992 Public Disclosure Authorized Public Disclosure Authorized

South Asia Region Country Department III Agriculture Operations Division

This documenthas a restricted distributionand may be used by recipients only in the performanceof their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EOUIVALENTS

US$1 - Rs 25.5 Rs 1 - US$0.0392

WEIGHTS AND MEASURES

Enelish/US Units Metric Units

1 inch (in) - 25.4 millimeters (mm) 1 foot (ft) - 30.5 centimeters (cm) 1 yard (yd) - 0.915 meters (m) 1 mile (mi) - 1.609 kilometers (km) 1 acre (ac) - 0.405 hectares (ha) 1 square mile (sq mi) - 259 ha 1 pound (lb) - 0.454 kilograms (kg) 1 long ton (lg t) - 1.016 metric tons (t) 1 cubic foot/second (cfs) - 0.0283 cubic meters/sec (m3/sec) 3 I acre foot (ac/ft) - 1,233.5 cubic meters (m )

FISCAL YEAR

July 1 - June 30 FOR OMCIL USEONLY ABBREVIATIONS AND ACRONYMS

ADB - Asian Development Bank ADP - Annual Development Program cca - Canal Command Area CIR - Country Implementation Review OWN? - Command Water Management Project EC - Electric Conductivity (of water or other solutions) ECNEC - Executive Committee of the National Economic Council FGW - Fresh Groundwater GOP - Government of Pakistan GOPunjab - Government of Punjab Province ICB - International Competitive Bidding rWASRI - International Waterlogging and Salinity Research Instltute LCB - Local Competitive Bidding NAF - Million Acre Feet MinW&P - Ministry of Water and Power M&E - Monitoring and Evaluation mmhos/cm - Millimhos per Centimeter (unit of electric conductivity) NRAP - Netherlands Research Assistance Project NDB - Non-Development Budget OFWM - On-Farm Water Management O&M - Operation and Maintenance PID - Punjab Irrigation Department ppm - Parts per Million P&I - Planning and Investigation Organization, WAPDA RAP - Revised Action Programme for Irrigated Agriculture RSC - Residual Sodium Carbonate SAR - Sodium Absorption Ratio SCARP - Salinity Control and Reclamation Project SGW - Saline Groundwater SOE - Statement of Expenditure TA - Technical Assistance TDS - Total Dissolved Solids TW - Tubevell UNDP - United Nations Development Program WAPDA - Water and Power Development Authority WMED - Watercourse Monitoring and Evaluation Directorate, WAPDA WUA - Water Users Associatior; W/C - Watercourse

GLOSSARY

chak - tertiary irrigation command kharif - wet season (mid-April to mid-October) mogha - uncontrolled outlet from parent supply channel to chak rabi - dry season (mid-October to mid-April) sarkari khal - communal portion of watercourse toba - natural depression varabundi - weekly rotational schedule of irrigation deliveries to farmers watercourse - irrigation distribution system within a chak

|This documenthas a restricteddistribution and maybe usedby recipientsonly in the performance of their officialduties. Its contentsmay not otherwisebe disclosedwithout World Bankauthor4ation | PAKISTAN

FORDWAHEASTERN SADIOIA (SOUTH) IRRIGATIONAND PRAINGE POJECT

Table of Contents

Page No.

CREDIT AND PROJECT SUMMARY ...... i-iii I. BACKGROUND ...... 1 Introdue~tion ...... 1 Demographic and Physical Features ...... 1 Agriculture and Its Performance ...... 2 Irrigated Agriculture and Water Management . . 2 - Indus Irrigation System. 2 - IrrigationOutside the Indus System ...... 2 - On-FarmWater Management . . 3 Drainage Systems... 3 - GroundwaterSituation and Significance. 3 - SurfaceDrains .. 3 - Subsurface Drainage .. 4 Government Policy and Bank Group Assistance Strategy 4 Lessons Learned from IDA Assisted Projects. . 6 Issues.. 7 Rationale for Bank Group Involvement ...... 10

II. THE PRCJECT AREA ...... 11 Climate ...... 11 Physical Features ...... 11 - Soils and Land Forms.11 - IrrigationSystem and Water Supply ... 11 - Drainage.12 Waterloggingand Salinity.13 Farm Size -nd Tenure.13 Cropping Intensitiesand Yields .14 Agricultural Inputs and Services.14 - Inputs .14 - AgriculturalSupport Services.15 Marketing.15

This report is based on the findings of an appraisal mission which visited Pakistan in June/July 1991. Mission members included Messrs. P. Streng, J. Mohamadi, W. Ochs, U. Qamar (IDA), B. Bishay, C.P. Cheng and M. Haider (consultants). A follow-upmission, comprisingMessrs. J. Nohamadi and N. Ahmad visited Pakistan in October 1991. A second follow-upmission, comprisingMessrs. N. Ahmad, Nadim Khouri and U. Qamar visited Pakistan in February 1992. The report was prepared by Messrs. M. Ahmad, U. Qamar and P. Streng. Peer reviewers and lead advisers were Messrs. G. Fauss, L. Noscoso and H. Plusquellec. Mr. Paul rsenman is the Country Director and Nr. Ridvan AlI the AgriculturalOperations Division Chief of Country Department III, South Asia Region. III. TI PRLOJECT, ...... 16 Project Concept and Objectives ...... 16 Project DescrLption . 17 A Interceptor Drains . . 17 B Lining of Distrbutaries and rs Minors 17 C Watercourse Improvemant ... 18 D Surf; *e Drainage System. . 18 Surface Drains ...... 18 • Drainage Effluent Disposal. . 19 E Field Trials and Monitoring for Phase 2 ...... 19 F Irrigation and Drainage Research ...... 20 G Monitoring and Evaluation ...... 21 H Technical Assistance and Training ...... 21 I Future Project Preparation ...... 22

IV. PRJECT COSTS. FINANCING AND PROCUREMET ...... 22 ProjectCosts ...... 22 Financing...... 23 Procurement ...... 23 Disbursement ...... 25 Accounts and Audits ...... 26

V. PROJECT IMPLEMENTATIONAND OPERATION. NAINTENANCE, AND COST RECOVERY ...... 26 Institutional Arrangements ...... 26 - Implementing Agencies ...... 26 - Project Coordination ...... 29 Monitoring and Evaluation ...... 30 Operationi, Maintenance and Cost Recovery ...... 31 Implementation Schedule ...... 32 Mid-Term Review ...... 33

VI. PRODUCTION. MARKETING AND PRICES. FARM INCOME ...... 33 Agricultural Impact ...... 33 - General ...... 33 - Cropping Pattern and Intensity ...... 34 - Crop Yields and Production ...... 34 Marketing and Prices ...... 35 Farm Income ...... 35

VII. BENEFITS AND JUSTIFICATION ...... 36 Production and Employment ...... 36 Other Benefits ...... 36 Economic Analysis ...... 36 Sensitivityand Risks ...... 37 Environmental Issues ...... 38

VIII. AGREEMENTS REACHED AND Rg"OMMENDATIONS ...... 38 ANS

Annex 1 - Table 1: Physical Features - Tible 2: Channels with InterceptorDrains - Table 3: Channels to be Lined - Table 4: Contracts for Surface Drains - Table 5: Planned and Additional Drains - Table 6: Cost estimate of Surface Drains

Annex 2 - Subsurface Drainage Field Trial Details

Annex 3 - Monitoring of Land and Water Conditions

Annex 4 - Irrigation and Drainage Research

Annex 5 - List of Equipment

Annex 6 - Table 1: Project Cost - Components by year - Table 2: Project Cost - Summary Accounts by year - Table 3: Project Cost - Summary Accounts by Component - Table 4: Project Cost - Components by year inc. Contingencies(Rs) - Table 5: Project Cost - Components by year .3ac.Contingencies ($)

Annex 7 - Table 1: Estimated DisbursementSchedule

- Table 2: DisbursementCategories

Annex 8 - Project ImplemenlationSchedule

Annex 9 - Table 1: Surface Water Availability - Table 2: Financial Budget - Total Project - Table 3: Financial Budgets of Small and Large Farm - Table 4: Financial and Economic Prices

Annex 10 - Economic Benefits and Costs Annex 11 - IDA Supervision Plan

CHART

I - Project Organizationand Coordination

NME

IBRD 23406 IBRD 23407 - L -

EQRDYANEASTERN SADIOIA (SOUTH) IRRIGATION AND DRAINAGE PROJECT

STAFF APPRAISAL REPORT

CREDIT AND PROJECT SUMNARY

BoXXower : Islamic Republic of Pakistan

Beneficiaries : Punjab Irrigationand Agriculture Departments,and Water and Power DevelopmentAuthority.

Amount IDA credit : SDR 39.6 million (US$54.20million equivalent)

T,erms : Standard with 35 years maturity

On-lending Terms : Not applicable

Descrgtion The proposed project is located in one of the least developed areas of Punjab province, about 300 km south of Lahore in the south-easterncorner of the Province. It is Government'sfirst effort to control waterloggingand salinity through improved water management. Beside removing severe water supply constraintsby increasingdelivery efficiencyof canals and watercourses, it would control excessive seepage, the major cause of waterloggingand salinity and provide surface drainage. The main objectives of the project are to: (i) increase agricultural productivityand income; (ii) reduce the need for expensive subsurfacedrainage and avert related environmentallyharmful effects; and (iii) improve the equity of water distribution. To achieve these objectives the project would: (a) conserve water by: (i) recoveringa significantamount of seepage from the larger channels by installing interceptordrains; and (ii) preventing seepage from distributariesand minors by providing imperviouslining and improving vatercourses; (b) provide a network of surface drains in the area to evacuate storm water run off; (e.)carry out research on technical and management issues crucial for irrigation and drainage subsectorsand their integration with agriculture; (d) provide technical assistance to ensure adequate back-up for implementing agencies and train project staff; and (e) monitor and evaluate the project's impact on groundwater table and agricultural production. The project would be implemented over a six year period. - il-

Benefits and Risks: Project benefits would include: (i) increase in agriculturalproduction; (ii) reduction in the area requiring subsurface drainage; (iii) improvement in surface drainage of the area; (iv) improvement in the eapabilitiesof implementingagenzies; (v) streng"aieningof farmer institutionsand their role in ?erat;ionand maintenance; (vi) enhancementof 'rinowledgeon the impact of waterloggingand salinity otncrops, and on the benefits of different types of *:.nal lining; and (vii) developmentof a pilot demand- based irrigation system.

The Punjab Irrigation Department has little past experience of lining canals with geo-membrane. This factor, c abined with the inherent weaknesses of Pakistan's construction industry could result in constructiondelays. To minimize this risk and to ensure the quality of construction,contracts for lining would be awarded following internatioral competitivebidding procedures and techn:eal assistance would be provided to ensure proper specificationsand constructionsupervision. Similarly, there is no past experience in Punjab in I.nterceptingseepage from canals with interceptor drains. In view of this, a gradual approach to the installationof interceptor drains would be adopted, whereby drains would be installesdalong the smaller channels based on the monitoring results from larger channels. Finally, implementationdelays could occur due to shortage of local funding. The Government is minimizing this risk by preparing three year rolling plans to assess future funding requirementsof ongoing as well as new projects. The current assessment is that adequate funding would be available for the project, as several on-going projects in Punjab are nearing completion.

Other Riske The Federal Shariat Court of Pakistan has recently given a ruling that the Shariah does not permit the payment or award of interest and thus, has instructed the Government to modify a number of existing laws that currently provide for payment of interest. The Government has filed an appeal vith the Supreme Court against the Shariat Court ruling, which has been stayed pending the outcome of the appeal. As far as Pakistan's obligationsunder loan and credit agreements with Bank/IDA are concerned, these would be valid and enforceableunder internationallaw, in accordancewith the terms of those agreements and the general conditions of Bank/IDA, notwithstandingany local law or judicial decision regarding the payment of interest and other charges, including any such ruling. - lil -

Estimated Proiget Cost:

(USS Million) Local Foreign Total

Interceptor Drains 15.83 6.15 21.98 Canal Lining 13.92 4.60 18.52 On Farm Water Management 0.70 0.10 0.80 Surface Drains 5.87 1.18 7.05 Phase 2 & Monitoring 2.31 0.94 3.25 Irrig./Drainage Research 4.07 0.58 4.66 Monitoring & Evaluation 0.31 0.00 0.31 Technical Assist. & Trng. 0.55 0.23 0.78 Future Proj. Preparation 0.57 0.43 1.00

Total Base Cost 44.13 ±4.21 58.34 Physical Contingencies 3.03 1.01 4.04 Price Contingencies 6.27 2.00 8.27

Total Project Cost 53.44 17.22 70.65 a/ a/ Includes US$ 7.6 m taxes and duties.

Financing Plan:

Local Foreign Total (USS Million)

Government 16.4 -- 16.4

IDA 37.0 17.2 54.2

Total 53.4 17.2 70.6

Estimated Disbursements: IDA Fiscal Year

93 94 95 96 97 (US$ Million)

Annual 1.5 5.7 9.4 10.5 10.6 10.9 5.6

Cumulative 1.5 7.2 16.6 27.1 37.7 48.6 54.2

Rate of Return 22X PAKISTAN

90RWAH EASTERN SADIQIA (SOUTH) IRRIGATION AND DRAINAGE PROJECT

I. BACKGrOUND

Introduct_4io

1.1 Much of the advance made in Pakistan's farm production since the mid- 1960s is due to the developmentof irrigated crop technology. However, yields in irrigated agriculture are low by world standards, due in part to poor management. One of the most constrainingfactors is inadequate and untimely supply of irrigation water to the farm. In mar.yareas, uncontrolledseepage to the groundwater from canals and watercourses for more than a century has resulted in high water tables. Continuous capillary rise and subsequent high rates of evaporationmove salts from the groundwater to the surface layers of the soil resulting itisoil degradation. These problems have become so severe in many areas that they cannot be overcome by the farmers alone. They require public investments to increase the delivery efficiency of the irrigation canals, thereby reducing excessive seepage to the groundwater,end to enlarge canal capacities to provide adequate water for irrigation and leaching, and constructionof drainage systems for the control and disposal of harmful groundwater salts.

1.2 Due to growing concern about the problem of waterloggingand salinity, the Government of Pakistan (GOP) requested IDA assistance in financing another subsurface saline drainage project in Punjab Province. Preparation of the feasibilityreport' was funded under Salinity Control and Reclamation Project-VI (SCARP VI, Cr. 754-PAK), and an appraisal mission visited Pakistan during June/July 1991. Due to data limitations,the mission found it difficuli to clearly define the area to be provided with subsurface drains, and therefore to come up with a reliable cost estimate for this key component. The mission also felt that water conservationmeasures woul. reduce subsurface drainage needs and lead to a more cost-effectivesubsurface drainage design. Instead of the project proposed in the feasibility report, the mission proposed a two-phased approach: a Phase 1 project, includingwater conservationmeasures, a research program, and additional preparationwork for subsurface drainage to be implementedunder a separate, future Phase 2 project. Preparation of Phase 1 was to be funded under SCARP VI. The Phase 1 project is the subject of this staff appraisal report.

DemograDhic and Physical Features

1.3 Pakistan's populat7 .) is now over 110 million; growing at an annual rate of over 3%, it is estimat-> to reach 151 million2 by the year 2000. Over 70% of the population lives !.i rural areas. Average annual per capita income is about US$375 equivalent,but 30% of the population is estimated to have annual income below the absolute poverty level (US$150).

l/ Fordwah Eastern Sadigia (South) Sub-Surface Drainage Project. FeasibilityReport, National EngineeringServices Pakistan (NESPAK) and HARZA Engineering Co. International,January 1991.

2/ Rapid Population Growth in Pakistan, World Bank, 1989. -2-

1.4 Pakistan covers an area of about 80 million ha of mainly ariu and semi-arid land. Approximately20 million ha are cultivated (16.5 million ha irrigated),3.0 million ha exploitable forest, and 8.0 million ha xangelands. Much of the Indus plain, the main agriculturalproducing region, receives less than 150 mm of rainfall annually whereas pan evaporation is more than 1,250 mm, which makes irrigationa virtual necessity.

Agriculture and Its Performance

1.5 Agriculture is the most important sector in the ec>....myin terms of contributionto gross domestic product (26%), foreign exchange earnings (70% of total, including 50% cotton based manufactures),and employment generation (54% of the labor force). Over 90% of total farm output comes from irri8gted land. Major crops are wheat, cotton, rice, and sugarcane. During the Sixth Five-Year Plan (FY84-88), qgriculturalproduction grew at 3.8% annuall- against a target of 4.9%. Major crops are estimated to have grown by 3.1% dt £Y90, whereas minor crops achieved their highest growth rate for the last five 7ur' (4%). Inadequate and untimely supply of irrigationwater coupled wit.;waterlogging and salinity continue to be among the most serious technical constraints limiting crop production. Even with the recent significantincreares in production, average yields of major field crops remain well below those of other developing countries.

Irrniated Agriculture and Water Management

1.6 Indus Irrigation System. The Indus system commands about 14.2 million ha and comprises the Indus river and its major tributaries,three major reservoirs (Tarbala,Mangla, and Chashma)3, 19 barrages or headworks, 12 lirk canals, 43 canal commands and over 100,000 chaks.4 The length of the canals is about 58,000 km, with communal watercourses(W/C), farm channels and field ditches running another 1.6 M km. Irrigation was practiced in the area as early as 1,000 BC; however, the first controlled year-round i.irgP-ion began in 1859 with the completion of the Upper BarL Doab Canal from the 1.,Jaopur headworks on the Ravi river. Following the 1960 Indus Water Treaty with India, huge link canals were constructed to supplement inadequateflows of the eastern rivers (Ravi and Sutlej).

1.7 In the Indus system, river water (about 130 billion m3) is diverted by barrages and weirs into main ccnals and subsequentlyinto branch canals, distributariesand minors. Open, tree-flowingoutlets (moghas) regulate water flow from distributariesand minors to W/Cs. With reservoir storage and pumpage by about 11,000 public and over 225,000 pr.vate tubewells from fresh groundwater (FGW) aquifers (about 43 b41lion m3), cropping intensity is now about 110%. The overall irrigation distriLtt.on efficiency is estimated to be below 40%, with maximum losses occurring in the chaks. Operation and maintenance (O&M) of the distributionsystem above the mogha is the responsibilityof the rrovincial Irrigation Departments,and farmers are responsible for O&M of W/Cs and field channels.

1.8 Irrigation Outside the Indus System. About 2.2 million ha of irrigated land is located outside the Indus canal command area (cca), scattered in relatively small parcels with water coming from open wells, tubewells, lift

3 3/ About 18 billion m of live storage.

4/ Tertiary irrigation command. -3-

pumps, karezes 5 , springs, and small diversions. Generally,water supply in these systems is uncertainand varies with season and location. Normallv,these systemsdo not suffer from waterloggingand salinity;however, O&M costs ate r.lativelyhigh, resultingin poor and inefficient0&M.

1.9 On-Pam Water Mana._ement. In each canal command,land is divided into watercoursecommand areas -- chaks. Each chak is a complexminiature Irrigationsystem with an averagelength of channelsof 16 km. Water distributionto the field is governedby a weekly tirs rotation (warabundi)based on the size of land holding. Plannedwater duty was originallyabout 0.085 m3 per second for each 400 ha, which permitteda cropping Lntensityof about 80%. A series of "SAID financedexperiments and investigationsconducted in the 1970 at WAPDA's Mona ReclamationExperiment Station (MRES)showed that water losses in the communalW/Cs were between30% and 50% with additietillosses in the farmer branches and field ditches. Technologicalimprovement centered on partialbrick lining of W/Cs, design and maintenanceof earthensections, design of permanent outlets, and specificationsfor land levelling.

Drainage Systems

1.10 GroundwaterSituation and Sianificance. The hydrologicaltalance of the Indus plain has been significantlyaltered during the past centuryby expanded diversionof river flows for irrigation. Seepage from the canal system and W/Cs, and deep percolationof irrigationwater from irrigatedland have resulted in a gradual rise of the groundwatertable. At the beginningof this century,the water table was generallybelow 15-20 m and thereforesubsurface drains were not providedbecause it would have been uneconomicto do so. However, the Indus Basin SalinitvSurvey 8 reports that 22% of the Indus irrigationsystem has a water table within 1.8 m and another 30% within 3 m of the surface. TMm waterloggingis increasingand estimatesare that currently over 40% of the area has water table within 3.0 m of the surface7. Diverting water to land brings with it salts which concentratein the upper soil layers when inadequatewater is appliedto leach them out and/or by capillaryaction when the water table is less than 1.5 m from the surface. This concentrationof salts makes soils problematic,and along with free water table in the root zone reducescrop yields. Hence, a major threat to increasingcrop productionis waterloggingand salinity.

1.11 SurfaceDrains. Numerous studiesand investigationsin Pakistanin the 1930s reported that waterloggingwas causedby inadequatesurface drains and differencesin the permeabilityof soil sub-strata. Her.;*,it was reasonedthat the rising groundwatertable was causedmainly by monsoon rainfall. If this would have been so, a high water table would have prevailedthroughout the Indus Plain before the introductionof irrigation,which was not the case. Since the major contributorto waterloggingis deep percolationof divertedirrigation water, surfacedrains have had only marginaleffect in slowing the rise of the groundwatertable. This is not to minimizetheir value becausethey do provide: (i) relief from rain flooding;(ii) an outlet for subsurfacedrainage effluent; (iii) reductionof seepageof rainfallto the groundwater;and (iv) limited removal of subsurfacewater.

5/ Traditionalirrigation system with tunnel channel.

6/ Indus Basin SalinitySurvey, VAPDA, 1981.

7 Seventh Five Year Plan Proposals (1988-1993),1987, 'Report of TechnicalCommittee on Drainageand Reclamation'. -4-

1.12 In 1973 and 1976, and again in 1988, floods from heavy monsoonrains resultedin masslveproperty damage and loss of nearly 1,000 lives. To reduce such damage,GOP and the Provinceshave installedabout 15,000 km of surface drainsand over 8,250 km of flood protectionbunds. In an effort to strengthen the surfacedrainage and flood protectionnetwork, the Asian DevelopmentBank (ADB) financedthe preparationof a NationalFlood Plan and is assistingin financingenvisaged works. As part of this programthere is need to extend the surfacedrainage system to provide appropriateoutlets to chaks.

1.13 SubsurfaceDrainaue. Responsibilityfor addressingthe problemof waterloggingand salinitywas assignedto WAPDA in 1958. Based on various studies,WAPDA initiateda nationwideprogram of salinitycontrol and reclamation projects (SCARPs)under which public tubewellawere installedto: (i) control waterloggingand salinity;and (ii) developfresh groundwater(FGW) 8 resources for agriculturalproduction. Installationof these large turbinetubevells (2-5 cusee capacity)and related surfacedrains has been funded under the Federal Annual DevelopmentProgram (ADP),whereas the ProvincialIrrigation Departments have been responsiblefor O&M, funded under the ProvincialNon-Development Budgets (NDB). VAPDA has ir.stalledabout 12,500 tubewells,of which about 11,000 in FGW and the rest in SGW zones. When completed,the SCARPs (mostlylocally funded)are to cover about 6.25 millionha. Even though over Rs 6,000 million have been investedin the program, only about 35X of this target has been achievedso far. The SCARPs raised farmers'interest in groundraterdevelopment, which resultedin installationof over 250.000small private suction-liftpumps (one cusec capacityor less). These privatetubewells have contributed substantiallyto the controlof waterloggingand salinity,but raised some governmentofficials' concern about over-exploitationof the groundwater resourcesin highly developadareas. It is estimatedthat annual pumpageof privatetubewells is over 37 billionm 3, and that of public tubewellsabout 6 billionm 3.

1.14 SCARP tubevellshave contributedto aaelioratingwaterlogging and salinityin localizedareas; however, the problemcontinues to grow even in the SCARP areas. WAPDA reportedthat about 25% of the SCARP commandarea has a watertablewithin 1.6 m of the surface. This continuinghigh water table has resultedfrom a multitudeof problems,i.e., technical,institutional, financial, and economic.9 Pumpingcapacity of individualSCARPs declinesby about 4.5% annuallybecause of blockageof screensand gravel packs, and poor pump maintenance. The cost (Rs 1416 million in FY92) of operatingtubewells in Punjab Provinceabsorbs more than 50% of availableO&M fundingeven though tubewellsare operatedon a very limitedbasis.

GovernmentPoliec and Bank Group AssistanceStrateov

1.15 GovernmentPolicy. The RevisedAction Programmefor Irrigated Agriculture(RAP), resultingfrom the UNDP financed,WAPDA implementedIndus PlanningStudy (PAK/74/044),for which the Bank was executingagency, was completedin May 1979. A major recommendationof RAP was provisionof "controlled"and/or "guaranteed"water supplics. To the extent possible, irrigationsupplies shouldbe made availableto match crop water needs in

6/ FGW in Pakistan is generally defined as having total dissolved solids (TDS) of less than 1,000 parts per million (ppm),and saline groundwater(SGW) as having more than 1,000 ppm.

9/ Revised Action Protramme for IrrigatedAgriculture, WAPDA Master Planningand Review Division,May 1979. quantityand time. The recommendedpolicies, programs and projectmodes to achievethis objectivewere:

(i) FGW resoutcesshould be developedand exploitedby the private sector,with public sector assistancein the form of supervised credit,and technologyand informationsupply;

(ui) a programshould be implementedfor transferringpublic FGW tubewells to the private sector (SCARPTransition);

(iii) a V/C lining program shouldbe executedby the public sector;

(iv) controlof waterloggingand salinityin SGW areas should have high priority in the goverrment'sinvestment program; and

(v) a basin and canal commandwater managementprogram shouldbe introduced.

The above recommendations,along with other RAP proposals,i.e., eliminationof tubevelland fertilizerstbsidies, investment priority for water management, systemsrehabilitation, ari programsto improvedelivery of non-waterinputs and services,have been adoptet policy of GOP in its Fifth, Sixth and Seventh (FY89- 93) Five-YearPlans. GOP fully recognizesthat the huge investmentmade in irrigationand drainagewould be largelywasted if the facilitiesare not maintained,efficiency of water deliveryand use is not improved,and further drainageis not provided to check waterloggingand salinity.

1.16 The Water Sector InvestmentPlanning Study (WSIPS,December 1990), also UNDP financedwith the Bank as executingagency, recommends to undertakea programof studies,research and pilot projectswhich would lead to the formulationand implementationof a long-termstrategy of Integrated ComprehensiveManagement of the Indus Basin. The short-termstrategy proposed by WSIPS is:

(i) Improvedoperation of the existingirrigation systems.

(ii) Equitablewater distributionto farm outlets (moghas).

(iiL) Watercourselining.

(iv) Conjunctiveuse of Mangla and Tarbelareservoirs. (v) Cost recovery.

(vi) Projectpreparation for pendingschemes.

(vii) Investigations,research and pilot programs.

1.17 With the settlementof the water allocationdispute between the provinces,a dominantconstraint to efficientutilization of availablevater has been removed,providing opportunities for a comprehensiveapproach to irrigation development. In the absence of this agreement,development efforts were usually limitedto improvinga single aspect or sectionof an irrigationsystem. Investmentprojects and modes of operationthat might alter the water allocations vere out of consideration. The currentenvironment allows optimaluse of water resourcesvithin each province,making it possibleto adopt improvedoperational policiesalong with the developmentefforts. 6-

1.18 Bank Group Assistance Strategv in agriculture is directed primarily at improving productivity in the sector, with particular emphasis on supporting development and improved management of Pakistan's Indus river irrigation system. The Bank's involvement in the water sector dates back to the successful settlement of the apportionment of the Indus water between Pakistan and India. Bank's financial assistance as well as polLcy advLce has contributed to attainment of self-sufficiency and export generation in the past decade. Up to the mid-1970s, the Bank assisted with the construction of large dams and link canals to develop additional water supplies. The Bank also assisted GOP with its SCARP program. In 1980s increasing attention was devoted to irrigation systems rehabliltation along with controlling the problems of waterlogging and salinity. The Bank's dialogue with the Government focussed on the long term sustainability of the lrrigation system and a new approach to cost recovery was instituted with the Government's endorsement. It involved provision of adequats fundin, for O&M, cost recovery and privatization of public tubewells in the fresh groundwater areas. These policies have been instrumental in the growth of agricultural production.

1.19 The Bank Group's operations include:

(i) SCARPs and drainage projects, to control waterlogging and salinity (Khairpur Tubewell Drainage Project [Cr. 22-PAK], Khairpur Tile Drainage and Irrigated Farming Development Project (Cr. 684-PAK], SCARP VI [Cr. 754-PAK], SCARP Mardan (Cr.877-PAR], Fourth Drainage Project (Gr. 1375-PAR], Left Bank Outfall Drain Project tLBOD, Cr. 1532-PAK]. SCARP Transition Pilot Project (Cr. 1693-PAK]) and the Second SCARP Transition Project (Cr. 2257-PAR);

(ii) projects to improve and rehabilitate the deteriorated irrigation eystem (Irrigation Systems Rehabilitation Project [Cr. 1239-PAR] and Second Irrigation Systems Rehabilitation Project [ISRP-II, Cr. 1888- PAR], Command Water Management Project [CWMP, Cr. 1487-PAR];

(iii) projects to improve water use in watercourse commands and on farms (On-Farm Water Management Project [Cr. 1163-PAK], Second On-Farm Water Management Project (Cr. 1603-PAR]), and the Third On-Farm Water Management Project (OFWM-III, Cr. 2245-PAK and Ln. 3327-PAR); and

(iv) a number of area development, flood damage restoration, agricultural extensLon and research, agricultural credit, and seeds projects.

1.20 While the above policies and operations have played crucial role in stimulating agricultural growth, it is now recognized that further improvements in productivity would primarily depend upon better match±ug trrigation supplies with crop demand and increasing involvement of farmers in decision making and operation and maintenance. Accordingly, the Bank's strategy now emphasizes: (i) a demand-based approach to irrigation management to achieve equitable and timely water deliveries and efficient use of water; (ii) preventive measures to control degradation of the resource base due to waterlogging and salinity; (iil) integration of institutions involved in irrigation and agriculture; and (iv) building farmer institutions.

Lesson. Learned from IDA Assisted Prolects

1.21 The projects which IDA helped finance in the sector have experienced a variety of implementation problems, i.e., slow GOP approval process, inadequate procurement procedures, unavailability of final designs for construction, and inexperiencedand inadequatelycapitalized contractors. This has delayed implementation-- for example, SCARP VI and SCARP Mardan are now being completed after an implementationperiod of more than ten years. While some of the factors that had caused serious delays in ongoing projects -- delay in preparation of PC- 110 documents, and lack of engineering designs -- are now being addressed through assistance by appraisal teams as necessary (PC-1 preparation)and stricter Government/Bankrequirements (availabilityof designs), the problem of inexperienced,under-capitalized civil works contractors remains. This problem became particularlyacute in the Fourth Drainage Project: the subsurface drainage contractor abandoned the site in May 1990, and it took until April 1991 to reach an understandingon the resumption of work and completion of remaining items (now expected by 1993).

1.22 On the contrary, progress in CWMP and ISRP-II (specially in Punjab) is quite satisfactory. Both of these projects have large canal remodellingand lining components. Similarly, the completion of the first two On-Farm Water Management Projects was timely, and the projects' physical targets were achieved. In most of these investments,the structuralmeasures remained the major focus of GOP, and water management, integrateduse of rivers, conjunctiveuse of ground- and surface water, and advanced crop planning received limited attention. From this experience the following lessons have been learned:

(i) there is a need to tighten prequalificationand bidding procedures to ensure awards are made to competent and well-financedcontractors;

(ii) current institutionalcapability to implement irrigationprojects is better than drainage projects;

(iii) subsurface drainage technology,both horizontal (tile) and vertical (tubewell),employed as designed, is effective in amelioratingthe debilitatingproblems of waterlogging and salinity;

(iv) adequate O&M funding and trained manpower must be provided to ensure sustainabilityof benefits;

(v) coordinated supply of non-water inputs and services is required to meet the objective of increased agriculturalproduction; and

(vi) further emphasis is needed on the water management policies basin wide, and at the provincial and canal command levels.

Issues

1:23 There are three significant issues relating to the proposed project that need to be appropriatelyresolved. They are: selection of experiencedand well-capitalizedcontractors; strengthening of O&M funding and cost recovery programs; and a vulti-dimensionalapproach to ensure efficient increases in agriculturalproduction.

1.24 Selection of Experiencedand Well-CapitalizedCivil Works Contractors. The IDA assisted SCARP VI, SCARP Mardan, and Fourth Drainage projects have been plagued by implementationproblems directly associated with inefficient operation and management of selected contractors. The firms selected

10/PC-1 stands for Planning CommissionProforma number 1. It is a proforma on which salient features of developmentproject are submittedfor GOPs approval. had little, if any, prior field experience in remodelling and lining large canals or installingtubeweli.s or horizontal pipe drains as required under the contract. This inexperiencewas compoundedby low bids, which made it almost impossiblefor the contractor to install the works without losing money. Steps must be taken to ensure that only experiencedand well-capitalizedcontractors are prequalified and selected. Prospectivecontractors must be thoroughlyevaluated to ensure their ability to fulfil' contract provisions. Awarding of contracts to firms of questionablecapability discouragesbona fide bids as potential bidders know that past awards have gone to such firms at unprofitableprices. Arrangementsmust be made by GOP to ensure: (i) broad disseminationof informationon the nature of civil works to be carried out and the required qualificationsof contractors; (ii) careful evaluationof prequalificationapplications and bids; and (iii) inspectionof potential contractors to verify their technical (personneland equipment)and financial capabilities.

1.25 Operation and Maintenance (OEM) Funding. The operation and maintenance of reservoirs and inter-riverlink canals is managed by the Water and Power DevelopmentAuthority (WAPDA, on behalf of the federal government). The O&M of the irrigation canal systems down to the watercourse outlets (mogha) is the responsibilityof the Provincial IrrigationDepartments (PIDs). Beyond the mogha, farmers maintain the watercoursesand farm channels. The maintenance of SCARP tubevel's and tile drainage pumps is also the responsibilityof PIDs. Funding for O&M of the irrigationsystem including the SCARP tubewells is allocated to PIDs by the Provincial Finance Departments through the Non- Development Budget (NDB). Normally O&M funding in the NDB should be met by financial resources generated within the Province. However, O&M funding has been adversely affected by the current public financial constraints,notwithstanding supplementalgrants by GOP to provincialNDBs. Furthermore to alleviate the funding problem, GOP has assumed the responsibilityfor rehabilitationof flood protectionworks and included it in the Federal Annual Development Program (ADP).

1.26 During the 1970s a major portion of the O&M budget was absorbed by the O&M cost of SCARP tubewells,resulting in shortfallsin the O&M needs for canals, surface drains and flood protectionworks. To overcome this problem, GOP and GOProvincesaccepted the recommendationof Revised Action Programme for IrrigatedAgriculture and initiated a transitionprogram to transfer tubewells in the FGW zones to the private sector for operation,maintenance, and replacement. To catch up with deferred maintenance,GOP and GOProvinces,with assistance from the Bank and other donors (such as USAID), embarked on a program to rehabilitate the irrigationsystem. The IDA-financedIrrigation System RehabilitationProject (ISRP-I, Cr 1239-PAK),a three-year time slice of the rehabilitationprogram, was initiated in 1983 in all four provinces. Under ISRP-I and the Command Water Management Project (CWMP), GOP and GOProvinces agreed to increase O&M funding for irrigationand drainage facilitiesand to furnish annual updates of O&M funding proposals to IDA for review and comment. During FY83 through FY87 the funding levels were increased by about 15% annually, and they generally met or exceeded the agreed O&M targets establishedunder ISRP-I.

1.27 During the appraisal of ISRP-II, the FY88 O&M funding levels were considered adequate, and thus emphasis was placed on two areas: (a) improving the capability and efficiency of PIDs in carrying out O&M activities; and (b) maintaining in real terms the level of O&M funding, using the FY88 funding levels as benchmarks for the existing facilitieswith appropriate increases to cover any new facilities. It is premature to make an evaluationof the extent to which the first objective is being met, as the ISRP-II is still ongoing. However, actual O&M funding allocations have fallen short of targets in all Provinces except NWFP since FY88. As already stated, the current financial constraintsfacing GOP and - 9 -

the Provinces have been a major factor contributingto this problem. In Jaruary 1992, however, there have been two positive developments. First, GOPunjab enhanced its O&M budget by a significantamount (Rs 75 million, about a 7% Increase in the annual allocation);and second, a program for desilting canals in unjab was undertuken with voluntary labor contributedby farmers (estimated cost Rs 40 million). These two measures have reduced the gap between the total allocation and the agreed O&M funding target in Punjab. While the other provinces have yet to take steps to enhance O&M budgets, assurances were provided during the March 1992 country implementationreview (CIR) between the Bank, GOP and GOProvinces that O&M allocationswould be enhanced to the agreed targets.

1.28 The annual review and discussion process adopted during the 1980s was instrumentalin highlightingthe importance of O&M allocationsand ensuring adequate allocations in the annual NDBs. During the CIR, and in subsequent discussions,GOP and GOProvinces have expressed the need for reviewing the O&M allocation targets. In this regard discussionswith the government have already begun with the objective of introducingan annual review process in which the Bank and the government would reach agreement on the O&M allocations for the following fiscal ,Year.

1.29 Cost Recovery. In order to provide adequate funds for proper maintenance of the system, it is the Government'sobjective to recover, as a minimum, the entire O&M expendituresthrough water charges. In Punjab and NWFP, water charges are assessed by PIDs, and in Sindh and Balochistan by the Revenue Department. In all provinces the collection is done by the Revenue Departments. Water charges are based on crop acreage and the type of crop (indirectlyrelating to water use).

1.30 A major reason for the inadequacyof O&M funds is the low level of water charges. During the mid-seventieswater charges supplied revenues totalling about 70% of total O&M expenditures,even though these expenditures were quite low. However, O&M expendituresincreased rapidly due to the increase in cost of operating tubewells. Over this period, GOP and IDA have held a continuous dialogue on the subject of water charges and, under several IDA- assisted projects, the provinces were required to increase water charges. Through FY79-82, all provinces increasedwater charges by about 95%. Sindh and Balochistan further increased water cha..gesin FY83, and Sindh introduced a new drainage cess in FY84. However, the provir..eshave not significantly increased water charges since FY84, following the introductionof Ushr, an Islamic levy used by local authorities to benefit the needy. Ushr levy is assessed on agriculturalproduction, and government considered that revenue from this levy qualifies as a substitutionfor water charges.

1.31 The appraisal of ISRP-II identified several sub-issues contributing to the widening gap between O&M allocationsand actual water charges collected. These included rapidly increasing O&M costs with no concurrent increase in water charge, and poorly administeredwater charge assessment and collection programs. GOP and GOProvinces agreed to arrangementsleading to eventual eliminationof O&M subsidies through: (i) increasingrevenue by improving water charge assessment and collection procedures; (ii) reducing O&M requirementsby privatizing public tubewells in FGW areas (SCARP Transition);and (iii) water charge adjustments to fill the gaps between the improved collections and required O&M allocations. These water charge adjustmentswere to commence after July 1, 1992, and full collection of O&M expenditureswas expected by July 1, 1997. Measures to improve revenue collection are in the early stages of implementationand expected results are slow to appear. Nevertheless, in FY91 O&M revenue collected in Punjab increased by more than 30%. There has also been some progress on privatizing - 10 -

tubevells. No significantwater charge increaseshave been implementedsince the agreement. During the recent CIR, GOProvincesreiterated their commitment to increase water charges in line with agreed covenants, and by July 1992, to develop plans to reach full O&M cost recovery. To this end, GOP and GOProvinces would adopt a transparentand annually monitorable plan to achieve full recovery by end FY98. Discussions are already underway between the Bank, GOP and GOProvinces to work out an agreement in this regard.

1.32 Multi-DimensionalApproach to Ensure Increased Agricultural Production. GOP recognizes the necessity of a multi-dimensionalapproach for achieving efficient increases in agriculturalproduction. Currently, there are many nation- and province-wide agriculturalprojects being implemented,and the proposed project would combine features of these projects (systems improvement, on-farm water management, agriculturalextension and research). In addition, GOP plans to make arrangements in the project area to ensure that all essential agriculturalcomponents will be available to beneficiaries. Appropriate arrangementsfor providing such componentswould be necessary for realizing the full benefits of the project investment. The proposed project's coordination arrangementswould help ensure this.

Rationale for Bank Involvement

1.33 This project would bring together major technical and policy recommendationsof the Revised Action Program and Water Sector Investment Planning Study. Even more importantly,following the agreement on the apportionmentof Indus waters among the Provinces, it provides for the first time the opportunity to adopt an integrated approach to irrigation development. It will also introduce a new and cost effective approach to control waterloggingand salinity through water conservationmeasures that are now feasible following the vater apportionmentagreement. Furthermore,the project's research component would provide answers to a number of questions critical for the future development of the Indus Basin irrigation system as intended in the provincial water apportionmentagreement. Through its policy dialogue with the Government and technical deliberationswith the implementingagencies, the Bank Group is well placed to assist in addressing policy, institutional,and technical issues relating to integrated irrigated agriculturemanagement and development of a "demand based" irrigation system. The Bank's involvementwould also play a catalytic role in:

(i) making irrigated agriculturepossible at lower cost by reducing the need for subsurface drainage;

(ii) mobilizing resources for financing complex and costly future projects;

(iii) ensuring full considerationand appropriatemitigation of adverse environmentaleffects of drainage projects;

(iv) assuring continuationof the Bank's leadership among donors in the field of irrigation and drainage,which is particularly importantat this time when many new avenues of policy and operational initiatives are opening;

(v) improving coordinationbetween agricultureand irrigation activities and respective instttutions;and

(vi) building farmer institutionsand providing them a formal role in O&N. - 11 -

II. THE PROJECTAREA 2.1 The proposedproject is locatedabout 300 km south of Lahorein the south-easterncorner of PunjabProvince. It coversparts of the tehsilsof Bahawalnagar,Haroonabad, and Chishtianin the BahawalnagarDistrict. The area is borderedon the northwestby the Malik BranchCanal, on the southby lands servedby the 6-R distributaryof the Hakra Branch,and on the east by India (see Map IBRD 23407). Gross area is about 121,000ha and commandarea (cca) about 105,000ha (Annex1, Table 1). There are approximately242,000 inhabitants, livingin a rural settingwith many villages,several small, but no major towns. Climate 2.2 The area has arid climateexcept during the July-Septembermonsoon season. Averageannual rainfall is about 225 mm. With pan evaporationin excess of 2,000 mm, irrigationis essentialfor agriculture.The hottestmonth is June with averagemaximum temperature of 460C. Januaryis the coolestmonth with averagemaximum temperature of 240C and minimumof 0°C. The projectarea is in the PunjabCotton Wheat agro-climaticzone where conditionspermit year-round cultivation. PhysicalFeatures

2.3 Soils and Land Forms. The projectarea was claimedfrom the Cholistandesert in the 1930swhen surfaceirrigation water was firstdelivered to that part of Punjab. The topsoilis generallymedium textured and underlaid by severalhundred meters of sand and silt depositedby the Gangesriver prior to the diversionof its flow to the Bay of Bengal. The topographyis largelyflat with no naturaldrainage. Outcroppingsand dunes occupyabout 6% of the area. Almost 70X of the area is made up of terraceremnants. The most important featureof these soils is the occurrenceof compactand calcareoussilty/clayey non-continuouslayers at varyingdepths, which restrictthe downwardflow of water and act as barriersto verticaldrainage. This conditionappears to be less prevalentin the southernportion of the projectarea. The rest of the soils are mostly subrecentlevees; although low in organicmatter and available phosphorusthey, along with the terraceremnants, are suitablefor irrigated agriculture. 2.4 IrrigationSystem and Water Supply. The projectarea is servedby the Hakra and Malik branchcanals, which are suppliedby the Eastern Sadiqia canalhaving its offtakeat the Suleimankiheadworks on the Sutlejriver (completedin 1933). The originaldesigned water duty was for 0.085 cumecper 400 ha (3 cusecsper 1000 acres),which would permita croppingintensity of about 80X (40% each season). The qualityof the surfacewater is good (about300 micromhos). Followingthe 1960 IndusWater Treatywith India,the area receives its water supplythrough the Balloki-Suleimankilink, which brings it under the commandof Manglareservoir. Most of the channelsare unlinedand due to the perviousnature of the soils leak large quantitiesof water. This seepageis one of the main reasonsfor waterloggingand salinizationof soils in the project area. 2.5 Water supplyhas increasedsignificantly since the commissioningof the Mangladam and improvementof diversionstructures (barrages), but the canal capacityhas not been increased.For this reason,canals are being operated withoutfreeboard. Becauseof the increasedwater supplybut more significantly subirrigationfrom the shallowwater tables,the croppingintensity is now about 130X. High evaporationfrom salinegroundwater brings large quantitiesof salts - 12 -

to the soil, affecting crop yields adversely. Surface water supply is short during the periods of peak crop water requirement (March, April, August, September and October). and in surplus during the rest of the year. According to the Baseline Survey carried out in 1989.11total supply to the project area is about 1.16 MAF (for monthly supplies see Annex 9, Table 1). Water distribution among distributariesand minors is inequitable. Similarly, flows to the watercoursesare also unequal with some drawing more than the design quantity and some less Furthermore, distributionwithin the watercourse command varies. Inequity in distribution results in inefficientuse of surface water and higher seepsge to the groundwater.

2.6 The profiectarea is underlain by the sediment deposited by Sutlej- Hakra river system. The quality of groundwater in the area is highly saline. Because of poor aquifer conditions and marginal-to-poorquality groundwater (generallyabove 1,250 micromhos),only limited groundwater developmenthas taken place. However, due to continuous seepage from the irrigation system a zone of fresh groundwaterhas been formed along the canals. During the last six years about 400 small private tubewells (one cusec or less) have been installed to provide supplemental ir-igationwater only during periods of peak crop water requirements. Therefore, utilization of these wells is very low. These tubewells are mostly located close to irrigation channels because groundwater quality around these channels is relatively better due to excessive seepage. Depending upon their location and depth, the water quality of these tubewells varies from fresh to brackish. Major constraints for the development of the fresh groundwater are its limited areal extent and contact with highly saline groundwater. Preliminary surveys indicate that large scale groundwater development in the area is not possible.

2.7 Drainage. There is no natural drainage system; roads and irrigation system have blocked most of the overland runoff. The project area was included as SCARP VIII in the regional developmentprogram for the Northern Indus Plains prepared by Timpton and Kalmbach, Inc. (consultantsto WAPDA) in 1967. It was redefined in 1978 by NESPAK, covering a total of 676,353 ha (1.67 million acres) on the left side of the Sutlej river in the Fordwah and Sadiqia canal commands. Out of this total, a pilot project of 31,509 ha (77,800 acres), known as Minchinabad Pilot Project, was implementedin the 1970s. In 1987, WAPDA further redefined the project area, excluding areas underlain by fresh groundwaterand the area covered by CWMP (Cr. 1487-PAK). This project, named Fordwah Eastern Sadiqia Remaining Phase-I (SCARP VIII), covered about 250,500 ha (618,580 acres). The most recent version of this project consists of two parts, the Northern and the Southern Zone. An independentnetwork of surface drains has been planned for each zone. The surface drains in the North zone are to discharge into the Sutlej river below the Islam Headworks. The surface drains in the South zone are to discharge into a series of evaporationponds situated at the end of the natural slope in the southwest of the project area in the Cholistan desert. The same evaporation ponds would be used to dispose of subsurface drainage effluent from the 6-R subproject of CWMP. Due to shortage of funds, work on surface drains has not progressed well. All of the planned surface drains in the South zone fall ia the area of the proposed Fordwah Eastern Sadiqia (South) Project, Phase 1.

2.8 The area does not have artysubsurface drainage, except the private tubewells mentioned in para 2.6 and some public tubewells installedby WAPDA.

1I/ Agro-EconomicEvaluation, Baseline Survey, Fordwah Eastern Sadiqia Project Phase-I& II SCARP VIII, WatercourseMonitoring & EvaluationDirectorate, Planning and InvestigationOrganization, WAPDA, October 1989. - 13 -

The performance of the public tubewellshas been marginal, mainly because of the poor aquifer conditions and low number of operating hours. Because of the small quantity of water pumped, the tubewellshave provided only limited relief from waterloggingand salinity.

Waterloggingand Salinity

2.9 About 50% of the project area is considered waterlogged by GOP (see Table 2.1) with a permanent water table within 1.5 m (5 feet) of the surface. It is estimated that more than 45% of the delivered surface water percolates to the groundwater. Waterloggingfirst appeared on lands in the upper reaches of the Hakra Branch and is graduallymoving down channel with an additional 6,000 ha affected each year. Currently, 11% of the area has a groundwater table of less than 0.76 m (2.5 feet), 17% of 0.76-1.22 m, and 21% of 1.22-1.52 m (4-5 feet).

Table 2.1: CURRENT WATERLOGGINGAND SALl. Y CONDITIONS

Waterlogging Soil Salinity Groundwater Percent Cumu- EC0 Percent Table Depth of CCA lative (mmohs/cm of CCA Cumulative (feet) at250C)

< .76 11 11 Over 16 4 4 1.76 - 1.22 17 28 8 - 16 1 5 1.22 - 1.52 21 49 4 - 8 7 12 over 1.52 51 100 < 4 88 100

2.10 About 12% of the cca is affected by soil salinity above threshold tolerance levels of most crops12. Unless the excessive seepage from the irrigation system is controlled and surface drainage relief is provided, waterloggingand salinity will keep increasing. At the current rate of increase, it is estimated that by the year 2000 about 50% of the cca would have water table depth of less than 1.2 m and EC, of more than 8 mmohs/cm, and by 2010 this share would increase to 65%.

Farm Size and Tenure

2.11 Table 2.2 shows the tenurial arrangements in the project area. The average farm size (5.8 ha) is about the same as the average for the country (about 5.0 ha). Owner-operatedfarms account for half of the land, tenant- operated farms about 29%, and owner-cum-tenantfarms the remaining 21%. About half of the farms are fragmented.

12/ Threshold tolerance level of soil salinity for sugarcane is EC, 1.7, for rabi fodder 1.5, kharif fodder 1.8, rice 3.0, wheat 6.0 and cotton 7.7. Source: Naas and Hoffman, Crop Salt Tolerance Current Assessment, Journal of Irrigation and Drainage Division, ASCE, June 1977. - 14 -

Table 2.2: TENURIAL ARRANGEMENTSAND FARM SIZE (ha)

Number of Farms Farm Area Average Farm Size Number X Area (ha) % Size (ha)

Small (less than 5 ha) 9,701 54 26,193 25 2.7 Medium (5-10 ha) 5,588 31 33,528 32 6.0 Large (over 10 ha) 2.714 15 45.053 A3 16.6 TOTAL 18,003 100 104,774 100 5.8

Source: Based on Pakistan Agriculture Census Report, 1980 (Punjab).

Cropping Intensities and Yields

2.12 The major crops in the project area are wheat, cotton, sugarcane, fodder, and IRRI rice. These crops account for more than 94% of the cropped area; the rest is under maize, pulses, and other minor crops. Annual cropping intensity is 129%, with 55% in kharif and 74% in rabi, counting sugarcane in both seasons. Considering that surface water availabilityis limited, these cropping intensitiesare quite high. The main reason is subirrigationfrom the shallow water tables. Crop yields are low and vary throughoutthe project area dependino upon soil conditions, degree of waterlogging,and farm practices. Yields are about 1.6 tons/ha for rice, 1.3 tons/ha for cotton, 1.9 tons/ha for wheat, 30 tons/ha for sugarcane,and 0.8 tons/ha for oilseeds. Crop productiotnand yields are adversely affected by shortage of irrigationwater during periods of peak crop water requirements,waterlogging and salinity, and insufficientsupply of non-water inputs (good quality seeds, fertilizer,and pesticides) and services. Agricultural Inputs and Services

2.13 Inputs. There is a shortage of improved seeds in the project area. Most farmers keep their own seeds or buy inferior quality from local dealers because of poor distributionfacilities and low supplies. Available supplies of Improved seeds meet about 7% of the area's requirement for wheat, 12% for cotton, and less than 1% for rice. The correspondingfigures for Punjab are 40% for cotton, and 20-30% for wheat and rice. The Punjab Seed Corporation (PSC) is the main source of improved seeds for cotton, wheat and rice. Some private suppliers have also recently started marketing seeds for cotton, maize, and some minor crops. These private suppliersare expected to play an increasingrole in the future, particularlyfor cotton and 'inor crops. Seeds produced by the PSC are procured by the Punjab AgriculturalDevelopment and Supplies Corporation (PADSC) and distributedthrough its seven depots. PSC also has about 34 private dealers in the area. Currently,neither PSG nor PADSC have bulk storage facilities for seed in the project area. This also makes timely availabilityof improved seeds difficult.

2.14 Fertilizeruse in the project area is low. In 1987-88, total fertilizer applicationwas estimated to be 62 kg/ha, against 117 kg/ha for Punjab and 86 kg/ha for Pakistan. Fertilizerapplications are generally comparableto the Punjab average, except in areas with high water table and soil salinity. Fertilizer distribution is handled both by private and public sector agenc'es; they include National FertilizerMarketing Limited, a subsidiaryof the public National Fertilizer Corporation,and three private companies, Fauji Fertilizer, Davood-Hercules,and Exxon. PADSC also distributes phosphatic fertilizers,which are mostly imported. Due to centralized imports of these fertilizers,supplies are often erratic and shortages occur during peak demand periods. - 15 -

2.15 Pesticide use in the project area is higher than on average in Punjab, mainly because of cotton of which 60%-80% is sprayed. Pesticide and herbicide marketing is mainly handled by the private sector.

2.16 Agricultural Suponrt Services. Agriculturalextension services in the project area are being strengthenedunder the on-going Agricultural Extension and Adaptive Research Project, Phase II (AEAR-II, Cr. 1762-PAK), which introduced the Training and Visit (T&V) system all over Punjab in 1987. The Deputy Director Agriculture (DDA) of Bahawalnagardistrict, assisted by three Extra Assistant Directors of Agriculture (EADA) at the tehsil headquartersof Haroonabad, Chishtian, and Bahawalnagar,is in charge of the extension activities in the project area. The nearest Adaptive Research Farm is at Vihari, about 50 km from the project area.

2.17 To enhance the capability of the extension service in providing advice tailored to the needs of farmers in a specific area, on-farm research is being introduced under AEAR-II and the Second AgriculturalResearch Project (Cr. 2154-PAK). Technical assistance is being provided to support the adaptive research program in developing systematic on-farm research, introducing computerizeddata processing, strengtheningresearch-extension linkages, and advising on procedures for developing extension messages. Diagnostic surveys are to be carried out through multi-disciplinaryteams of extension and research staff to help develop appropriate research programs to so'Lvefarmers' priority needs in various agro-climaticzones.

Marketing

2.18 In Pakistan, both government and the private sector are engaged in procurement and marketing of farm output. Government procurement through designated agencies covers wheat, cotton, rice, gram, potatoes, onions, oilseeds and sugarcane. Prices for these products are fixed taking into considerationthe cost of production, domestic demand, supply and stock position, domestic and internationalprices, and possible impact on the cost of living. Support prices through risk transfer are to provide incentives to farmers (at substantial cost to government,which sometimes leads to a situationwhere a support price is set but no transactionstake place because no budget is provided).

2.19 Farmers sell surplus production to individualbuyers, government or semi-governmentprocurement agencies and agro-processingplants, or at village markets where transactionsare carried out by brokers, traders, and commission agents. Further up the marketing chain is a wide network of town markets through which agriculturalcommodities from the village markets are channeled by brokers, wholesalers and retailers to the larger urban centers for sale to consumers and for export. Present marketing and processing facilities are adequate to handle the project's estimated incrementaloutputs.

2.20 Currently, about 60% of Pakistan'swheat production is consumed on the farm or sold in the open market. The rest is marketed in the public sector. Public sector procurement is carried out by the Provincial Food Departmentsand the Pakistan AgriculturalStorage and Services Corporation (PASSCO). About half of Pakistan's total paddy production is consumed on the farm, while most of the marketable surplus is bought by the state-ownedRice Export Corporation (RECP) and is exported. Cotton and sugarcane are sold, either directly or through an intermediary,to ginneries and sugar mills. Ginned cotton is consumed domesticallyas well as exported by the state-ownedCotton Export Corporationand private firms. In areas where there is no sugar mill, sugarcane is usually processed into gur (raw sugar) for local consumption. - 16 -

2.21 In the project area, the tehail headquartersof Haroonabad, Bahawalnagarand Chishtian are the main marketing centers for farm inputs and outputs. Most of the products are handled by commissionagents. Wheat, paddy, and cotton are also procured by public sector agencies, including the Punjab Food Department, PASSCO, Rice Export Corporation,and Cotton Export Corporation. Most of the sugarcane is sold to the sugar mills at Chishtian and Bahawalnagarand the rest is converted into gur. About 30 ginneries purchase cotton from the project area, and cotton seed is sold back to farmers or to oil expellers.

III. THE PROJECT

3.1 The proposed six-year project (FY93-98)would cover a command area of 104,774 ha in Punjab province and include : (i) Water ConservationMeasures (installationof interceptordrains, canal lining, improvementof watercourses); (ii) Surface Drainage; (iii) Irrigationand Drainage Research; (iv) Monitoring and Evaluationof project impact; and (v) Technical Assistance and Training, field trials for subsurfacedrainage and funding for preparing a future project.

Proiect Concept and Obiectives

3.2 The project is designed to remove severe vater supply constraints by improving the delivery efficiency of canals and W/Cs and at the same time reducing seepage to the groundwater. Improved control through lining of distributariesand minors, resulting in more equitable distributionof water, would bring efficient water use within W/C commands. These water conservation measures combined with surface drainage would be instrumentalin lowering the water table and reducing eventual subc>arfacedrainage needs. Although precise quantificationof the impact of thcs.cnaasures on the groundwater table is difficult to assess in advance, rs.3T-ces are that on average the proposed project would cause the water tuoLe in the project area to fall by one to one- and-half feet (0.30-0.46m). As a result, upward movement of salts from groundwater to soils would be reduced by about four tons per acre (on average) annually due to the lower rate of evaporationfrom the groundwater table. A monitoring program to quantify the project impact, evaluate the performance of proposed interventionsand assess the subsurfacedrainage requirementsfor phase 2 would be implementedunder the project.

3.3 The main objectives of the project are to: (i) raise agricultural production, employmentand income; (ii) reduce the need for expensive subsurface drainage and environmentallyharmful effects related with such drainage; (iii) improve the equity of water distribution; (iv) develop models for integrated irrigated agriculturemanagement involving a "demand based" system and enhanced farmer participation;and (v) improve the capabilityof WAPDA and GOPunjab to plan, implement,operate, and maintain similar projects. The first three objectiveswould be achieved by:

(a) increasingwater supply to reduce the gap between crop water demand and irrigation supply, improving water management, and draining excess storm water;

(b) slowing down land deteriorationdue to waterloggingand salinity through reduction of seepage losses from irrigationchannels and improvementof on-farm water management; and

(c) improving availabilityof agr:culturalinputs and services; - 17 -

The last two objective would be achieved through applied research, and provision of technical assistance and training.

Froiect Description

(A) InterceRtorDrains (Base Cost USS 21.98 million).

3.4 Approximately 280 km of horizontal interceptordrai.ns (subsurface tile drains) would be installed along the Malik and Hakra branches, anc.Sirajwah, Murad, Khatan and Harunabad distributaries(Annex 1, Table 2). Thesiedrains would intercept a significantpart of the seepage from the canals and hence reduce drainage requirementsand provide supplementalwater for irrigation. A single line of drain would be installed on both sides of the channels with the exception of Malik branch and Murad distributarywhere drain would be provided only on the left side. The drains would be installed about 50-150 m from the canals. Each drain would comprisi of a single line of plastic (PVC or PE) perforated pipe laid by trenching machines on a 1:2000 slope with river run gravel envelop to a maximum depth of about 3 m. Pipe diameter would vary from 102 mm to 385 mm, depending on the soil condition, seepage rate, and drain length. Approximately 153 sumps would be provided, each about 1830 m (6000 feet) apart with manholes every 305 m (1000 feet), and two drains would discharge into one sump. Discharge from the sumps would be pumped directly into a watercourse or returned to the canal. The electric energy for the sump pumps wr-ildbe supplied by a transmissiongrid of about 230 km of 11 KV lines. Step-down transformers(about 100) would be installed to provide power to each pump. The operation of the system would be controlled by a series of automatic devices at each sump. There would be devices for monitoring the level of water in the sumps, the amount of sump discharge, and i\ status of operation of each pump. The recorded data would be transmittedthrough a power line carrier to a grid station serving a bank of sumps. Personnel at the grid station can control the operation of each sump, except when overridden by thermal breakers. For the design of interceptordrains, a two-dimensionalanalysis developed by the US Bureau of Reclamationhas been used. Installationof the these drains would be coordinatedwith canal lining and watercourse improvement. Base cost of the component includes cost of civil works, consulting services for design and supervision,equipment (Annex 5), incremental staff salaries and operating expenditure required for the implementation.

3.5 The system of interceptordrains would be first installedalong the Hakra and Malik branches. A program satisfactoryto the Project Coordination Committee (para 5.13) would be prepared and implementedfor monitoring performanceof the installed drains. Interceptordrains would then be installed along the remaining channels (Annex 1, Table 2) provided monitoring indicates that they will perform satisfactorilyalong the smaller channels as well.

(B) Lining of Distributariesand Minors (Base Cost USS 18.52 million).

3.6 Approximately18 channels (Annex 1, Table 3) with original design discharge of up to 2.83 cumec (100 cusecs) would be lined. The total length of the lined sections would be about 180 'Km. The actual discharge of most of these channels is about 20% higher than the design. The lined section would be designed to carry the actual discharge, and adequate freeboard would be provided for safe operation. This would result in a slight increase in the capacity to deliver water. Moghas would be remodelled, canal structures improved, and control structures provided to meet water management rsquirements.To provide effective seepage control, the lining would consist of geo-membraneplaced on compacted subgrade and covered with a hard protective cover of concrete slabs - 18 -

with water tight joints. Trapezoidal sections with side slope of 1:1 for up to 0.85 cumec and 1.5:1 for higher discharge with non-silting velocities would be used. Channels of up to 0.3 cumec (10 cusecs) capacity would be lined using precast sections, possibly during the closure periods. Assurances were obtained that GOP. WAPDA and PID would observe groger specificationsand design criteria and take measures to control quality of constructionacceptable to IDA.

3.7 Lining would practically eliminate seepage losses and, as the area is underlain by SGW, would conserve valuable surface water. Reduction in seepage would also help in controlling the groundwatertable. Improvement in water control and remodelling of moghas, specially towards the tail-end reaches, would ensure equitable water delivery to chaks, resulting in an overall increase in water use efficiency. Increased capacity and improved control would provide greater flexibility to follow the fluctuationsin crop demand in the operation of the channels. Assurances were obtained from GOP. GOPuniab and PID that adeguate water supplv would be provided to the proiect area and operation of the channels would be modified to meet crop water requirementsas closely as possible. The project's research componentwould provide guidelines for such modifications. Canal lining would be coordinatedwith the installationof interceptordrains and watercourse improvement. The cost estimate for this component includes provision for lining the smaller channels currently ear-marked for the interceptordrains.

(C) Watercourse Improvement (Base Cost US5 0.80 million).

3.8 Out of 668 W/Cs in (Annex 1, Table 1) the project area, about 134 have already been improved. A voluntary and participatoryprogram similar to the OFWN-III would be instituted for the improvementof the remaining wacercourses. Watercourse improvementwould be provided on a first come basis. It is estimated that about 340 (about 65 percent) watercourseswould be improved under the project. Civil works material would be provided by OFWM-III (Cr. 2245- PAK, Ln. 3327-PAK), and only the cost of additional field staff, transport and equipmentwould be provided by this project. Four additional field teams, having the same compositionas under OFWN-III, would be needed to implement this component. However, recruitment of new staff would not be necessary as staff from CWMP (Cr. 1487-PAK), scheduled to ciose by July 1992, would be assigned to this project.

3.9 OFWM-III specifications,design criteria, and quality control procedures would be followed in W/C improvement. Precision land leveling of approximately1200 ha, OFWM demonstrationcenters, training of 50 OFWM field staff and 40 agriculture extension personnel would also be provided. Provision has been made for approximately 60 staff-monthsof local supervisory consultants for verificationof design, quantity and quality of civil works. Terms of reference for the supervisoryconsultants would be the same as under OFWM-III. Since OFWM-III is expected to close in FY95, assurances were obtained from GOP. GOPuniab and PAD that improvementof watercoursesin the project area would be completed bX June 30. 1995. W/C improvementwould be coordinatedwith installationof interceptor drains and canal lining.

(D) Surface Drainage System (Base Cost USM 7.05 million)

3.10 Surface Drains. At present, WAPDA has planned 16 surface drains of about 308 km length in the project area, and design of most of these drains has been completed. Constructionof the drains and evaporationponds is divided into 12 contracts. A list of these contracts and their status is in Annex 1, Table 4. Due to shortage of funds, progress on constructionof the surface drains has been limited. Since timely completion of the drains is essential for achieving - 19 -

project objectives, GOP requested that constructionof remaining drains be included in the project. Therefore, drains for which constructioncontracts are not yet awarded would be included in the project. Assurances were obtained from GOP and WAPDA that work under the on-going contracts (number SC-1. SC-2. SC-3. SC-4. NC-7. NC-8 and NC12) would be coordinatedwith constructionof the rest of the drainage system under this project. Review of the existing surface drainage plans revealed that some of the area requiring surface drainage is not adequately covered. Therefore, nine additional drains of 38 km length would be included under this project. The total length of surface drains in the project area would thus be 352 km, of which 159 km would be financed under the project (Annex 1, Table 5 and 6).

3.11 Surface drains would be open, unlined channels with minimum width of 4 feet and side slopes of 1 vertical to 2.5 horizontal. Mild side slopes are adopted to reduce sloughing because soil in the area is sandy. Bed slopes would conform to the topography of the area. Drains would be generally deep enough allowing drainage of the maximum number of depressions,collection of some subsurface water, and ensuring minimum seepage of saline effluent if discharged into these drains by the subsurface drainage system envisaged under Phase 2.

3.12 Drainage Effluent Disposal. The volume of surface drainage effluent varies from year to year depending upon the intensity of storms in the monsoon season. The maximum is estimated to be about 47,300 acre feet based on the highest recorded storms in 1978. The salt concentrationof the drainage effluent is estimated to range from 600 to 1,000 ppm. The effluent would, therefore,be usable for agriculture. Since the project area does not have a gravity outlet to the sea or to the Sutlej river, the surface drains would discharge into two natural depressions (tobas), Khanduwala and Thulanwala, located in the southwest of the project area in the Cholistan desert. These tobas are approximately15 km from irrigated land and some 13 km from the recently discovered confined fresh groundwateraquifer at Mojgarh/FortAbbas. The Khanduwala toba covers an area of 1700 ha (4200 acres) and has a storage capacity of about 43,000 acre feet. This would provide sufficient capacity to hold the maximum estimated volume of effluent (1978 storms). A portion of the Thulanwala Toba would be used only in the event of extremely high storms. A program to use water from the surface drains and tobas for agriculturalpurposes would be developed under the research component of the project.

(E) Field Trials & Monitoring for Phase 2 (Base Cost USS3.25 million).

3.13 To facilitate the preparationof future subsurface drainage systems, funding would be provided for field trials for subsurface drainage, monitoring and evaluation, data gathering, research and development of regional groundwater model. The need for subsurface drainage in the project area would be assessed after completion of the proposed measures based on the monitoring and evaluation results. However, envisaged activities would be useful for the preparationof drainage projects in the Indus basin and would provide answers to several important questions in the drainage sector.

3.14 Field Trials for Subsurface Drainage. The proposed field trials are designed to test subsurface drainage parameters and synthetic fabric material to be used as envelope. The drainage paramsters such as drainage coefficient, drain spacing, and drain depth would be tested in the primary fields of the trial areas, whereas testing of synthetic fabric envelopes would be done in separate plots adjacent to the primary fields. About three to six trial sites ranging from about 60 ha (150 acres) to 405 ha (1000 acres) would be selected covering all soil types in the project area. The test drains would be laid at an average - 20 -

depth of 1.7 m (5.5 feet) and at 2.4 m (8.0 feet). Drain spacing would range from 92 m (300 feet) to 275 m (900 feet) depending on soil type and drain depth. The drains woule.be tested for S (estimateddrains spacing), 0.5 S and 2 S at the same site with an appropriatebuffer zone between each layout pattern. River-run gravel envelope would be provided for the drains used to test the drainage parameters. For testing the synthetic fabric envelope, at every site one drain of 610 m (2000 feet) length would be installedwith fabric envelope and sand, and another with fabric envelope only. Observationwells would be provided to measure water table fluctuations.

3.15 The field trials would provide basis of subsurfacedrainage research, such as drainage parameters, suitable depths for drain pipes, construction methods for pipe drains etc. A database and informationsystem would be prepared and models to simulate the groundwater and salt balance and transport would be developed. Further details are in Annex 2.

3.16 Monitoring of Land and Water Conditions. To assess the effect of water conservationmeasures (lining and interceptordrains) and surface drainage, the project would provide for detailed monitoring of land and water conditions. Monitoringwould include fluctuationsin the water table, and quality of groundwater and surface drainage water, soil salinity and other hydrological parameters. The fresh groundwater potential in the project area would be assessed and methods for safe extractionwould be proposed. Remote sensing technologywould be used to the extent possible. Overall monitoring activities are outlined in Annex 3.

(F) Irrijation and Drainage Research (Base Cost USS 4.66 million).

3.17 A research component is included in the project in order to provide quantitativeinformation to specific planning and implementationquestions of relevance to this and other projects in irrigationand drainage. Pakistan has a long history of research in irrigated agriculture and full use of this research is being made in the present project. More research is needed, however, because of the specificityof the project site and also because previous research in irrigation and drainage has often been fragmented, yielding results that are sometimes contradictoryand often cannot be directly applied to field conditions.

3.18 The overall objective of the research component is to refine the critical elements in the planning and implementationof irrigationand drainage projects in the Eastern Sadiqia region. Particular emphasis will be placed on research questions that will integrate the improvementof water use efficiency with improved water and land management in the project area. The results obtained will also be relevant to other areas of Pakistan. The research component consists of the following five subcomponents:(i) evaluation of the impact of waterloggingand salinity on crop production; (ii) introductionof improved technology for planning and monitoring irrigationand drainage projects, and land and water conditions in general; (iii) assessing performance of different types of canal lining; (iv) improvemento- irrigationmanagement with a view to match irrigation supply with crop water demand that is integrated irrigated agriculture management; and (v) Agriculture extension support. The four themes of research should be seen as organical y linked and close interactionwill be maintained for the exchange of data and re ults. The extension activities would focus on the specific needs of the project area and would be instrumentalin wider application of the results of waterloggingand salinity research.

3.19 The topics included in the research component are generally consistent with previous findings and recommendationsof technical and scientific - 21 -

panels who have studied the question of irrigationand drainage research in Pakistan13. These setivitieswould be coordinatedwith rhe other componentsof the project, specially the monitoring of land and water conditionsand project impact. In order to implementpilot programs under the integrated irrigated agriculture component,assurance has been obtained that the Directorate of CWN. in association with the PID. would submit a draft report containingRroposals for formalizing farmers organizations.and conceptualdesign of a demand based svstem for the Bank's review by September 30. 1993 and the proposed pilot programs would be implemented during the project imolementationperiod. For further details of irrigationand drainage research component see Annex 4.

(G) Monitorine & Evaluation of Project Imoact(BaseCost US$0.31 million).

3.20 The project would include a program for monitoring and evaluation of project impact. Required agro-economicdata would be collected under this component. Informationon physical conditionsgathered for Phase 2 preparation would be utilized in the evaluation. A baseline survey covering agro-economic, social, and water management conditionsprior to the project was completed in 1989 by WMED, WAPDA (para 2.5). The monitoring and evaluationwould include: (a) impact evaluation in terms of agriculturalproduction, income and employment, situation of small farmers, and secondary effects on the regional economy; (b) cropping pattern and cropping intensities,and net farm income; and (c) impact on water use, and equity in distribution.

(H) Technical Assistanceand Training (Base Cost USS 0.78 million14)

3.21 The project would engage interna-ionallyreputed specialiststo establish and review design criteria, specificationsand constructionmethods for canal lining and interceptordrains; advise in the formulationof research and monitoring programs; and assist in project management and overall planning. Training would include the study of modern constructiontechniques, project planning and management. Visiting experts would conduct short-term training courses. The project would also fund short term overseas training for project staff.

3.22 In addition to the specialist consultants,the project would provide consulting services for preparation of detailed designs and bidding documents and constructionsupervision of interceptor drains, surface drains, canal lining, OFWN, phase preparation and research component. Assurances were obtained from WAPDA. PID. and PAD that consultantswould be recruited following Bank suidelines under terms of reference acceRtable to IDA. Assuranceswere also obtained that the evaluationof the proRosals received for the consulting services would be completed and furnished to IDA prior to Credit effectiveness.

13. See for example: IWASRI/UNDP.1989. "Evaluationof Waterloggingand Salinity Research in Pakistan." PublicationNo. 7. InternationalWaterlogging and Salinity Research Institute.Lahore; and Planning Commiss'on. 1978. "Research Issues Affecting AgriculturalDevelopment Policy -The report of the Indus Basin research assessment group" Planning Division, Government of Pakistan.

14 Cost of specialist consultantsand training only. Cost of design and supervisory consultants is included in the respectiveproject components. - 22 -

(I) Future Project Preparation (Base Cost USS 1.00 million).

3.23 The project would provide funds for future project preparation. If monitoring and evaluation of Phase-i shows that some areas would still require subsurface drainage, these funds would be used to prepare detailed designs for subsur-facedrainage. The dcsign of the phase 2 would be greatly facilitated by the drainage research undertaken in the pro4ect. Funds not needed for preparation of tubsurface drainage component of the second phase would be used to prepare another water sector project.

IV. PROJECT COSTS. FINANCING AND PROCUREMENT Project Costs

4.1 Total project cost over the six-year period (July 1992-June 1998) is estimated to be Rs 1,944 million (US$ 70.65 million equivalent)with a foreign exchange component of Rs 473.49 million or 24%. Estimates are based on June 1992 prices and include about Rs 208 million in taxes and duties. The project cost suimmaryis presented in Tables 4.1 and 4.2 and details are given in Annex 6. Cost of interceptordrains is based on consultants'estimates. Cost of canal lining is based on quantities estimated by the Punjab Irrigation Department and prevailing market prices. Cost of the on-farm water management component includes the recurring costs of additional field staff only; cost of civil works would be borne by the OFWM-III Project. Cost of surface drains are based on WAPDA's estimates prepared for the Fordwah Eastern Sadiqia Remaining (SCARP VIII) project. Cost of monitoring and Phase 2 preparation is based on the feasibility report by WAPDA and consultants. Physical contingenciesare estimated to be 8% for interceptor drains and monitoring and Phase 2 preparation,and 10% for canal lining and surface drains. Total physical contingenciesare about 7% of base costs. Price contingenciesare 13% of base cost plus physical contingencies using estimated annual inflation rates shown in the footnote to Table 4.2.

Table 4.1: COST SUMMARY BY COMPONENT

Rupees (Million) USS (Million) Percent Foreign Local Foreign Total Local Foreign Total Exchange

Interceptor Drains 403.64 156.86 560.49 15.83 6.15 21.98 28.0 Canal Lining 354.86 117.30 472.16 13.92 4.60 18.52 24.8 On Farm Water Management 17.86 2.54 20.40 0.70 0.10 0.80 12.5 Surface Drains 149.79 30.07 179.86 5.87 1.18 7.05 16.7 Monitoring & Phase 2 Prep 58.88 23.91 82.79 2.31 0.94 3.25 28.9 Irrigation Drainage Res. 103.87 14.87 118.74 4.07 0.58 4.66 12.5 Monitoring & Evaluation 7.80 0.00 7.80 0.31 0.00 0.31 0.0 Technical Assist. & Trng. 14.08 5.92 20.00 0.55 0.23 0.78 29.6 Future Proj. Preparation 14.55 10.95 25.50 0.57 0.43 1.00 42.9

Total Baseline Costs 1125.33 362.41 1487.74 44.13 14.21 58.34 24.4 Physical Contingencies 77.35 25.65 103.00 3.03 1.01 4.04 24.9 Price Contingencies/a 267.94 85.43 353.38 6.27 2.00 8.27 24.2

Total project cost /b 1470.63 473.49 1944.12 53.44 17.22 70.65 24.4 - 23 -

Table 4.2: COST BY SUMMARY ACCOUNTS

Rupees (Million) USS (Million) Percent Foreign Local Foreign Total Local Foreign Total Exchange

Civil Works 854.34 288.39 1142.73 33.50 11.31 44.81 25.2 Consulting Services 83.45 53.78 137.23 3.27 2.11 5.38 39.2 Admin. & Operat. Expendi. 171.83 4.53 176.36 6.74 0.18 6.92 2.6 Equipment 7.56 7.56 15.13 0.30 0.30 0.59 50.0 Vehicles 8.15 8.15 16.30 0.32 0.32 0.64 50.0

Total Baseline Cost 1125.33 362.41 1487.74 44.13 14.21 58.34 24.4 Physical Contingencies 77.35 25.65 103.00 3.03 1.01 4.04 24.9 Price Contingencies/a 267.94 85.43 353.38 6.27 2.00 8.27 24.2

Total Project Cost /b 1470.63 473.49 1944.12 53.44 17.22 70.65 24.4

/a Based on following inflationrates (December 12, 1991) FY93 FY94 FY95 FY96 FY97 FY98 Local 6.0 6.0 6.0 6.0 6.0 6.0 Foreign 3.4 3.9 3.85 3.8 3.8 3.8

/b Includes taxes and duties of about Rs 208 m or US$ 7.6 m equivalent.

Financing

4.2 The IDA Credit of SDR 39.6 million (US$ 54.20 million) would finance about 86% of the total project cost net of taxes and duties or 77% of the total cost. GOP/GOPunjabwould finance the remaining US$ 16.45 million equivalent, including taxes and duties, or 23% of total cost. Approval of the project's PC-i by the Executive Council of the National Economic Committee (ECNEC) would be a condition of credit effectiveness. Table 4.3 shows the proposed financing plan.

Table 4.3: PROJECT FINANCING (US$ million)

Total GOP/ IDA IDA Cost GOPuniab X

Civil Works 55.44 13.86 41.58 75 Consulting Services 6.12 1.22 4.90 80 Administrationand Operating Exp. 7.80 0.78 7.02 90 Equipment 0.62 0.25 0.37 60 Vehicles 0.67 0.33 0.33 50

TOTAL 70.65 16.45 54.20 77

Procurement

4.3 Procurementarrangements are summarized in Table 4.4 below. Civil works for interceptordrains, surface drains, canal lining and field trials for drainage would be procured through internationalcompetitive bidding (ICB) following IDA guidelines. To the extent practicable,contracts for civil works - 24 -

Table 4.4: PROCUREMENT (US$ million) /a

ProcurementMethod Total Cost ICB LJB Othe

CIVIL WORKS

Interceptor Drains 23.90 23.90 (17.93) (17.93)

Canal lining 20.61 20.61 (15.46) (15.46)

Surface drains 6.29 1.50/c 7.79 (4.72) (1.12) (5.84) Monitoring and Phase 2 Preparation 2.30 0.50/b 2.80 (1.73) (0.37) (2.10)

Irrigation & Drainage Research 0.34/c 0.34 (0.25) (0.25)

Sub-total 53.10 1.84 0.50 55.44 (39.84) (1.37) (0.37) (41.58)

Consulting Services 6.12 6.12 (4.90) (4.90)

Administration& Operating 7.80/d 7.80 Expenditure (7.02) (7.02)

Equipment 0.62/e 0.62 (0.37) (0.37)

Vehicles 0.67 0.67 (0.33) (0.33)

Total 59.89 2.46 8.30 70.65 (45.07) (1.74) (7.39) (54.20)

a/ Includes taxes, duties and contingencies. Figures in parentheses are the respective amounts financed by IDA. /b WAPDA force account for monitoring components. /c Scattered sites, ICB not appropriate. /d Incrementalstaff. salaries, and operating expenditure. /e Consists of relatively small and non-homogenouspackages unsuitable for ICB. - 25 -

shall be grouped in bid packages estimated to cost the equivalent of (a) not less than US$ 10.00 million in the case of interceptordrains and canal lining, and (b) not less than US$ 3.0 million in the case of surface drains. Constructionof small size additional surface drains (AD-1 to AD-9), estimated to cost less than the equivalent of US$ 200,000 per contract, up to an aggregate amount not to exceed the equivalent of US$ 1.5 million would be procured through local competitivebidding (LCB). Vehicles required for various project components would also be procured through ICB. The Bank's sample bidding documents (SBD) for procurement of works and goods would be used. Office, surveying, flow measuring and other equipment, consisting of relatively small and unrelated packages that would not attract foreign bidders, estimated to cost less than the equivalent of US$ 50,000 per contract, up to an aggregate amount not to exceed the equivalent of US$ 620,000 may be procured through LCB. Minor civil works in the irrigation and drainage research component scattered in the area, not suitable for ICB, would be procured through LCB. Tender documents for procurementsexceeding US$ 20,000 equivalent for equipment, US$ 100,000 for vehicles, and USS 200,000 equivalent for works would be subject to prior review by IDA. Consultants for various project components would be selected following Bank guidelines for use of consultants.

Disbursements

4.4 Proceeds of the IDA credit would be disbursed against the following expenditurecategories:

Cate orv Percentage to be Financed

(i) Civil Works. 75% of expenditure.

(ii) Consulting services. 80% of expenditure.

(iii) Incremental staff salaries, 90% of expenditures,and 100% of allowances and operating expenditure for training. expenditure,and training.

(iv) Equipment and Vehicles 100% of foreign expenditures, 100% of local expenditures (ex-factorycosts) and, 60% of local expendituresfor items procured locally.

4.5 Disbursements for contracts of civil works below US$ 200,000 equivalent, equipment below US$ 20,000 equivalent and vehicles below US$ 100,000 equivalent and all incrementalstaff salaries would be made against certified statements of expenditures (SOEs). Full documentationwould be retained by implementingagencies for review by supervisionmissions and would be subject to audit by independentauditors. All other contractswould be fully documented. To facilitate payment of eligible expendituresone Special Account each would be establishedby General Manager (Water) Central WAPDA, Chief Engineer Coordinatilon PID and Punjab Agriculture Department (PAD) with initial deposits of US$ 2.0 million, US$ 1.0 million and US$ 0.15 million respectively,representing reimbursableportion of estimated expendituresfor four months. The PAD Special Account would meet the requirementsof OFWM, Agriculture extension and Directorate of CWM. The credit proceeds would be disbursed over six and a half years. The disbursementprofile is based on the experience gained under similar projects in Punjab. Since all project activities are to be carried out in one contiguous area, it is expected that project implementationwould proceed - 26 -

smoothly and faster than projects that have components located in all the four provinces. The estimated disbursementschedule is given in Annex 7. The Credit Closing date would be December 31, 1998.

4.6 Accounts and Audit All implementingagencies (WAPDA, PID and PAD) would maintain separate accounts for the project. Assurances were obtained during negotiations that: (a) orolect accounts of all agencies. including Special Accounts would be audited annually by independentauditors acceptable to IDA: and (b) audit reports would be sent to IDA within nine months of the end of each fiscal year. Audit reports would include separate opinions of the auditors on (i) reimbursementsclaimed on the basis of SOEs and (ii) operation of the Special Accounts.

V. PROJECT IMPLEMENTATIONAND OPERATION. MAINTENANCE AND COST RECOVERY

InstitutionalArrangements

5.1 ImplementingAgencies. The project would be implementedby WAPDA, and the Punjab Irrigation (PID) and Agriculture (PAD) Departments. The proposed organization is shown in Chart-l and the roles of the implementingagencies are described below.

5.2 WAPDA would be responsible for: (i) constructionof interceptorand surface drainage systems; (ii) monitoring and Phase 2 preparation (field trials for subsurface drainage, monitoring of land and water conditions,and assessment of fresh groundwater potential); (iii) research on the impact of waterloggingand salinity on crop production, performanceof different types of lining, and improved technology for planning and monitoring; (iv) monito3ringand evaluation of project impact; and (v) coordinationamong the implementingagencies.

5.3 The responsibilityfor interceptorand surface drains would be assigned to a Project Director (Drainage)headquartered at Bahawalnagarand assisted by four Executive Engineers (XENs) (two existing, and two additional for the interceptordrains). The Project Director (Drainage)would be responsible for:

(i) assisting in the recruitment of supervisoryconsultants, procurement of vehicles and equipment for the interceptordrainage and surface drainage system;

(ii) carrying out condition surveys of channels to be provided with interceptor drains in collaborationwith WAPDA's Planning and InvestigationOrganization (P&I);

(iii) reviewing detailed designs and tender documents prepared by the consultants prior to their submission to IDA;

(iv) assisting in awarding and administeringcontracts for interceptorand surface drain construction;

(v) monitoring the impact of interceptordrains;

(vi) coordinatingand consolidatingwork plans and quarterly progress reports for individual project components for submission to the Project CoordinationCommittee and IDA; and - 27 - (vii) maintainingproject accounts (including Special Account) for the activitiesunder his responsibility,preparing withdrawal applications, and arrangingtimely submission of accountsto the DirectorGeneral Audit WAPDA. 5.4 The ProjectDirector Planning (Water) Central. WAPDA would have overallresponsibility for field trialsfor preparationof Phase 2. The InternationalWaterloggine and SalinityResearch Institute (IWASRI) would be responsiblefor researchon: (i) tile drainageat the field trial sites;and (ii) comparisonof differenttypes of lining. For tile drainageresearch, IWASRI in cooperationwith NetherlandsResearch Assistance Project (NRAP) would provide supervisorystaff, analyze data, prepare reports, meet the cost of operationand maintenanceof vehicles,and supplysome equipmentfor the field trials. It would coordinateits activitieswith the ProjectDirector Planning (Water) Central,WAPDA's SCARP MonitoringOrganization (SMO) and the International IrrigationManagement Institute (IIMI-Pakistan). For canal liningresearch, IWASRIwould sub-contractwith a suitableorganization. 5.5 SMO would be responsiblefor monitoringof land and water conditions (includingthe field trial sites)and assessmentof fresh groundwaterpotential in the projectarea. It would collaboratewith the ProjectDirector (Drainage), ProjectDirector Planning (Water) Central, IWASRI, P&I and the Watercourse Monitoringand EvaluationDirectorate (WMED). 5.6 P&I would be responsiblefor researchon the impactof waterlogging and salinityon crop productionand the use of improvedtechnology for planning and monitoring. P&I would coordinateits activitieswith the ProjectDirector (Drainage),Project Director Planning (Water) Central, IWASRI and SM0, and collaborateclosely with IIMI-Pakistan.

5.7 PID would be responsiblefor canal liningand collaboratingwith the Directorateof CWM for the researchcomponent on IrrigatedAgriculture Management. An organizationalstructure similar to ISRP-II(Cr. 1888-PAK)would be established.A ProjectImplementation Unit (PIU)headed by the Chief Engineer Coordinationwould be establishedat Lahore. A ProjectDirector (Lining) assistedby two XENs, postedin the projectarea, would be responsiblefor canal lining. Each XEN would be assistedby three subdivisionalofficers (SDOs), nine sub-engineersand supportstaff. The PIU would be responsiblefor: (i) recruitingsupervisory consultants, and procuringvehicles and equipment for the canal liningcomponent;

(il) carryingout conditionsurveys of channelsto be lined; (iii) reviewingdetailed designs and tenderdocuments prepared by the supervisoryconsultants prior to their submissionto IDA;

(iv) awardingand administeringcontracts for canal lining; (v) coordinatingclosely with the OFWM field teams on designsof moghasand watercourses,and maintainingequity of water deliveriesfollowing liningand remodellingof moghas; (vi) collaboratingwith CWM Directorateon the researchfor Irrigated AgricultureManagement; (vii) preparingand submit:zmngannual work plans and quarterlyprogress - 28 - reportsto the ProjectDirector (Drainage) for consolidation; (viii) monitoringimpact of canal liningon: groundwatertable; seepage and otherconveyance losses; equity of distribution;hydraulic and structuralstability; and levelof O&M costs;and (ix) maintainingproject accounts (including the SpecialAccount) for the activitiesunder its responsibility,preparing withdrawal applications, and arrangingtimely submission of accountsto the officeof the DirectorGeneral Audit Punjab. 5.8 The PuniabAgriculture Department would be responsiblefor watercourseimprovement, extension activities, and researchon Irrigated AgricultureManagement.

5.9 The DirectorateGeneral of OFNN would be responsiblefor watercourse improvementand other OFWM activities,recruitment of supervisoryconsultants and procurementof equipmentand vehiclesfor this component. The Directoratewould designatea Coordinatorfor the projectand assignfour engineeringand four agronomyfield teams to the projectarea to improvewatercourses and provide water managementadvice as envisagedunder OFWM-III.

5.10 The DirectorateGeneral of AgricultureExtension (DGAE) is responsiblefor all extensionactivities in Punjabunder the ongoingT&V program. The DDA Bahawalnagaris in chargeof extensionactivities in the projectarea. In additionto ongoingactivities under the secondphase of the Punjab AgriculturalExtension and AdaptiveResearch Project (Cr. 1762-PAK),the DDA wouldbe responsiblefor implementingproject specific activities with the assistanceof the EADAs,AOs and FAs postedin the projectarea. Specifically, the DDA Bahawalnagarwould be responsiblefor: (i) maintainingclose liaisonwith the AgriculturalExtension and Adaptive ResearchProject as well as the SecondAgricultural Research Project (Cr. 2154-PAR)to ensurethat diagnosticsurveys and area specificon- farm researchare carriedout and appropriateextension messages are developedfor the projectarea;

(ii) procuringaudiovisual equipment and vehiclesenvisaged under the project;

(iii) preparingvideo tapes of extensionmessages in collaborationwith the DirectorateGeneral of AgricultureInformation (DGAI) and the OFWM TrainingInstitute on water managementon the farm, and with IWASRI,P&I and SNO on vaterloggingand salinity,and drainage; (iv) arrangingaudiovisual shows (e.g.,on land reclamation,control of vaterloggingand salinity)in selectedvillages and demonstratingthe same techniquesat demonstrationcenters in coordinationwith the Senior SubjectMatter Specialist (SSMS) Vehari and the responsibleOFWM agronomyfield team(s);and (v) collaboratingwith P&I (WAPDA),OFWM, Directorateof CWN and PID staff in encouragingfarmers to improvewater management,maintain equity in water deliveriesafter canal liningand outletremodelling, apply water accordingto crop needs,and participatein developmentof seed multiplicationprograms. - 29 -

5.11 The Directorate of CWM would be responsible for research on Irrigated Agriculture Management. It would assign two interdisciplinaryteams headed by a sub-project Manager, who would be an agriculturaleconomist. Each team would include one social organizer, one engineer, one agronomist, and one hydrologist. Staff of required disciplinesnot available with the Directorate of CWMwould be recrutted. The Directorateof OWM, in associationwith PID, would be responsible for:

(i) organizing and training farmer groups, including federationsof WUAs;

(ii) carrying out diagnostic surveys and analysis;

(iii) reviewing existing legislation,including, inter alia, WUAs Ordinance/Act,the Canal and Drainage Act and the Warabandi Laws; formulating amendments or new legal instruments to formalize farmer institutionsand define their role in O&M; and exploring appropriate substitutes for Warabandi and alternative arrangementsfor assessSng and collecting water charges;

(iv) carrying out resebrch, and preparit.gconceptual designs of canals, structures,and watercourseworks, and operationalplans for a demand based irrigation system in collaborationwith PID, OFWM and farmer groups;

(v) reviewing progress of constructionof civil works and structures for the demand based system, and awarding and administeringcontracts for farmer community centers and seed storage facilities;

(vi) overseeing and facilitatingoperation of the demand based system and training farmers in assuming O&M responsibilities;

(vii) advising farmers on conjunctiveuse of ground and surface water where feasible and organizing farmers groups for joint utilization of water from, and O&M of, interceptordrain sumps;

(viii) promoting farmer seed multiplicationprograms and facilitatingfarmers in obtaining basic seed from the Punjab Seed Corporation,and research and extension farms; and

(ix) arranging for large scale demonstrations(full watercourse trials) to facilitate transfer of technology and introductionof improved water management and cultural practices.

5.12 Assurances were obtained from GOP. GOPuniab and WAPDA that all implementingagencies would furnish annual work programs to IDA for its concurrenceby March 31 for the following fiscal year starting from FY93

5.13 Pro1ect Coordination. At the project level, the existing Project Coordination Committee (PCC), establishedunder the Fourth Drainage Project (Cr. 1375-PAK), would be responsible for coordinationamong the implementingagencies and facilitating implementation. The PCC would be chaired by the General Manager (Water) Central, WAPDA, and have the followingmembers: (i) from WAPDA: Chief Engineer, Rahim Yar Khan, Project Director (Drainage),Project Director Planning (Water) Central, Chief Engineer P&I, Chief Engineer SMO, and Director General IWASRI; (ii) from PID: Chief Engineer Coordination,and Project Director (Lining);and (iii) from PAD: Director Field and Area Coordinator,OFWM, DDA Bahawalnagarand Director CWM. Representativesof farmers (e.g., chairmen of -s -

WUAs) and DistrictAdministration would be invitedto the PCC meetingsas required. The PCC wouldmeet quarterlyand the ProjectDirector (Drainage) would be its secretary.The main functionsof the PCC would be to: (i) monitor progressand coordinatescheduling of the variousproject components; (ii) consolidateand reviewwork plans and progressreports for submissionto IDA; (iii)make appropriaterecommendations to GOPunjaband WAPDA regardingbudgetary allocationsand othermatters; and (iv) reviewstatus of compliancewith various projectcovenants, take appropriateaction to resolveissues, and report unresolvedissues to the PolicyCommittee.

5.14 At the provinciallevel, the existingPolicy Committee would provide policyguidance and steerproject implementation by providinginter-agency coordinationat the highestlevel. It wouldbe chairedby the ChairmanPlanning and DevelopmentBoard and wouldhave the followingmembers: Secretaries of Irrigationand Power,Agriculture, and Finance,GOPunjab, and GeneralManager (Water)Central and ProjectDirector Planning (Water) Central, WAPDA. The Policy Committeewould meet wheneve.1 issuesrequiring resolution are submittedfor its considerationand the ProjectDirector (Drainage) would act as its secretary. The main functionsof the PolicyCommittee would be to: (i) resolveissues not settledby the ProjectCoordination Committee; (ii) ensureprovision of adequate budgetaryallocations for projectimplementation as well as operationand maintenance(O&M); an; (iii)formulate and implementpolicies to enhance beneficiaryparticitation and recoveryof O&M and investmentcosts. Monitoringand Evaluation(M&E)

5.15 The main objectiveof the projectis to increaseagricultural productionthrough conservation and bettermanagement of water and reductionof waterloggingand salinity. To determinewhether this objectiveis beingmet, an M&E programwould be carriedout that would provide:

(i) an internalmanagement information system for the implementingagencies, to facilitateefficient and environmentallysafe implementation;and (i) an independentexternal evaluation of the project'simpact and the degreeto which it is meetingits objectives.

5.16 InternalMonitoring. The implementingagencies would be responsible for collectingand reviewinginformation on physicaland financialprogress and impactof theirrespective components. They would submitperiodic progress reportsto the PCC and the PolicyCommittee. Feedbackfrom externalM&E and varioussupervisory consultants would also keep projectmanagement informed about currentand potentialimplementation problems and the project'simpact. This would enablethe implementingagencies to take timelyaction to facilitate implementationand to make necessaryadjustments in projectapproach or designof individualcuoponents to ensureproject objectives are met.

5.17 ExternalN&E. Responsibilityfor externalM&E wouldbe assignedto WAPDA'sSCARP Monitoring Organization (SMO) in collaborationwith WMED, EnvironmentalUnit and IWASRI. SMO would provideoverall coordination and have directresponsibility for:

(i) monitoringphysical features such as groundwaterelevations and quality, water qualityin interceptorand surfacedrains, soil salinity,and fresh groundwaterpockets; and - 31 - (ii) monitoringof the evaporationponds and adjacentareas 15, including(a) water qualityand build-upof toxicminerals (e.g. selenium,arsenic and lead);(b) vectorssuch as mosquitos;and (c) impactof water table on agriculturallands surroundingthe ponds. The basic informationcollected would be used for both Phase2 p.eparationand evaluationof the physicalimpact of the project. SMO would developa monitoring plan to establishfrequency of observations,intensity of network,manpower requirements,and evaluationprocedures. Remote sensing would be used where appropriate.

5.18 MED would be assignedresponsibility for agro-economicM&E. Buildingupon the BaselineSurvey carried out in 1989,16WMED would initiate project-widemonitoring immediately after project approval to obtainbaseline informationnot alreadyavailable. It would also selecta numberof indicators for: (i) determiningthe rate of inpututilizatior (e.g., seeds, fertilizers, pesticides,water deliveries,farm labor,draft power);and (ii)monitoring outputs,including (a) hydraulicmeasurements in lined channelsto determine deliverylosses and irrigation/applicationefficiencies, (b) equityof delivery in lined channelsand watercourses,taking into accounteffects of supply variationsin upstreamchannels (branch and main canals),(c) cropping intensities,cropping patterns, yields and production,net farm incomesand cash flows,and (d) WUA operations.Changes in the selectedindicators would be assessedand documentedon a bi-annualbasis and reportedto the implementing agenci-.s.This would enablethese agenciesto make appropriateadjustments in the designor schedulingof individualcomponents and improvedelivery of services. 5.19 Assuranceswere obtainedfrom GOP and WAPDA that the SMO would submit an overallmonitoring and evaluationRrogram defining Drecise resnonsibilities of variousagencies (along with draft inter-and intra-agencyagreements) and providingdetailed scope of work for IDA approvalby December31. 1992. gReration.Maintenance and Cost Recovery b.20 InstitutionalResponsibilities. WAPDA would be responsiblefor the operationand maintenanceof the interceptorand surfacedrains for two years after the completionof works. After this trialperiod, facilities would be handedover to PID if their overallperformance is satisfactory.Operation and mainte:ancecost of surfaceand interceptordrains is estimatedto be about Rs 20 mil.ionper year (FY92prices). O&M responsibilityfor the irrigationchannels is vestedin PID, which is not expectedto requireadditional funding as O&M requirementfor lined channelswould be less than that for unlinedchannels. Otner facilities,transport and equipmentwould be operatedand maintainedby the departmentto which such itemsare assigned. 5.21 Budgetand Cost RecoveryPolicies. Althoughthe provincialO&M cost for irrigationand drainagesystems have averagedabout 9% of the annual

15/ SMO would seek guidancefrom WAPDA'senvironmental unit, and take into accountfindings and recommendationsof the ongoingDrainage Environmental AssessmentStudy, and varioushealth organizations, as necessary.

16/ Agro-EconomicEvaluation, Baseline Survey, Fordwah Eastern Sadiqia Project Phase-I& II SCARPVIII, Watercourse Monitoring & EvaluationDirectorate, Planningand InvestigationOrganization, WAPDA, October 1989. - 32 -

provincial budgets over the last five years, the condition of irrigation and drainage systems are far from satisfactory. About 50% of total O&M allocations are used for the O&M of the FGW TWs. Consistent with current GOP policies the Provinces are committed not to undertake new investmentsor replacement of TWs for public operation in FGW areas. A SCARP transition program to privatize FGW TWs is ongoing in the provinces of Punjab and Sindh. The GOPunjab agreed to expedite the privatizationplans and divest itself of the ownership of the FGW TWs completelyby July 1997. To this end, another SCARP transition Projec,.,the preparationof which will start next year as envisaged under the Second SCARP Transition Project would provide continuingassistance in these efforts. However, to ensure availabilityof adequate funds for maintaining the irrigation and drainage systems 5ncluding the project facilities, it is essential that the GOPunjab makes adequate budgetary allocationsto PID. Assurance was obtained that Punjab will discuss with IDA by February 15 of each fiscal year beginning with FY93. the level of funding required for operation and maintenance of the surface irrigation,fresh groundwatertubewells and drainage facilities in Puniab for the following fiscal year. and based on mutually agreed funding levels. provide adequate budgetary allocations.

5.22 Cost recovery for irrigationand drainage systems has been a key issue in the Bank's ongoing dialc;ue with GOP and GOPunjab. In Punjab, the recoveries from water charges are far below O&M allocations. To achieve full recovery of 0SM allocations in the Punjab, including the project area, assurance was obtained that. Puniab shall. through water and/or drainage charges:

(i) by July 1. 1993 achieve a recovery level of at least 35% of the annual 0&_J cost of its surface irrigation.fresh groundwater tubewell and drainage facilities:

(ii) by July 1. 1994. achieve a recovery level of at least 45% of such cost:

(iii) by July 1. 1995. achieve a recovery level of at least 55% of such cost:

(iv) by July 1. 1996. achieve a recovery level of at least 70% of such cost:

(v) by July 1. 1997. achieve a recovery level of at least 90% of such cost: and

(vi) by July 1. 1998. achieve and thereaftermaintain a recovery level of 100% of such cost.

5.23 It is estimated that at full developmentof the project facilities, O&M costs at 1992 nrices would be about Rs 240 per ha of cca, or Rs 150 per cropped ha or Rs 22 per acre foot of water delivered at the watercoursehead. To fully recover these O&M costs, water charges would account for less than 4% of crop production costs and less than 5% of farm income, which is well within the farmers' capaclty to pay.

ImolementationSchedule

5.24 The PC-i document of the project has been approved by the Provincial DevelopmentWorking Party (PDWP), WAPDA and Central DevelopmentWorking Party (CDWP) and is scheduled to be submitted for ECNEC approval at the next meeting expected to be held in July 1992. To meet the local cost component, budgetary allocationshave been made in the FY93 budget. Project Director Drainage (WAPDA) and most of associated staff are already in place and Project Director Lining (PID) and associated staff would be appointed by July 31, 1992. With these steps and a "project launch" workshop in Lahore the project activities would take-off - 33 -

rapidly after the Board approval.

5.25 The project would be implementedover six years, FY93-FY98 (see Annex 8). The first year would be spent mainly in appointing consultants,preparing final designs and tender documents for civil works, and procuring equipment and vehicles. About 5% of the civil works would be completed in the first year. Design and preparation work for the surface drains is at an advanced stage, therefore, constructionworks of this component would proceed relatively faster. Constructionof OFWM works would pick up in the first year and would finish by FY95. About 8OX of the civil works would be completed during the project years three through six. Installationof the field trials would finish in third project year and monitoring will continue over the rest of the implementation period. Research activities would be spread about evenly over the implementation period. The proposed supervisionplan for IDA, required staff inputs and expected skill requirementsare given in Annex 11.

5.26 Mid-Term Review In order to evaluate the effectivenessof the project interventionsin achieving project objectives,a mid term review will be undertaken during the third year of the implementation,but not latter than March 31. 1995. The review would be carried out jointly by WAPDA, GOPunjab, and IDA according to the terms of reference prepared jointly by WAPIDAand GOPunjab six months prior to the review which shall be approved by IDA. This mid-term review would allow opportunity to effect changes in the policy and implementationof the project which may be desirable based upon experienceunder the initial operation of the project and results of monitoring and research.

VI. PRODUCTION.MARKETING AND PRICES. FARM INCOME

Agricultural ImRact

6.1 General. The improvementsprovided under the project would have a significant impact on crop production and farm income over the entire command area. Waterloggingand soil salinity in the project area are rep'rted to be increasingat a rapid rate (para 2.10), which would depress futut. yields. Sinee, the cost of eivil works for watercourse renovatfon is met by the Third On- Farm Water Management Project (only incrementalcost of implementationis included in the project), the costs and benefits of watercourse renovation are excluded. Therefore, the assumed future "without project" situation includes the effects of OFWM improvements. Furthermore,it is assumed that future yields without the project (and without OFWM) would not fall because of inereasing waterloggingand soil salinity, which is a conservativeassumption. Production inereases "with project" would be due to both increased cropping intensity and inereasedyields resulting from: (a) irrigation improvementsmade possible by project works, including reliable scheduled deliveries, increasedwater supply through reduction of losses, and equitable distributionbetween head and tail reaches of channels; (b) control of the groundwatertable due to reduced seepage to the groundwater from canals and rainfall; and (c) reduction of crop losses from storm flooding through improved surface drainage.

6.2 Based on informationprovided by the NESPAK/HARZAfeasibility report for the Fordwah Eastern Sadiqia (South) subsurface drainage project, t-o farm types have been chosen to represent the project: the small farm (3.5 ha), and the large farm (11 ha). Small farms cover 41% of the project area, while large farms cover 59X. Of the total number of farms in the project area (about 17,900), nearly 70X are small. Based on farm data collected by the appraisal - 34 -

mission, presented in the above feasibilityreport, and complementedby data from comparable areas elsewhere, a quantitativeanalysis was carried out using a component of the Indus Basin Model Revised.17

6.3 Croppi.naPattern and Intensity. Table 6.1 summarizes cropped area and cropping intensitiesunder present, without project (with OFWH), and with project conditions. Additional water saved due to increased delivery efficiency would be about 91 thousand acre feet (kaf) annually, of which 42 kaf in rabi and 49 kaf in kharif (see Annex 9, Table 1). This increase would result in both removal of water stress and increase in cropped area. Cropping intensity "with project" on small farms would increase by about 23%, and by about 27.5% on large farms (about 26% in the total project area). Total cropped area under the two major crops, cotton and wheat, would increase by about 20%.

6.4 CroR Yields and Production. The improved water supply and groundwater control due to seepage reduction and surface drainage would result in about 15% increase in yield of cotton, 13% of mustard, rape and sugarcane, and 4% of wheat. The yield increase of fodder crops would be nominal. The combined effect of increases in cropped area and yields on production is shown in Table 6.2. Incrementalproduction of cotton and wheat in the total project area (about 105,000 ha cca) is 14,600 tons and 22,400 tons, respectively,at full development

Table 6.1: ESTIMATED CROPPED AREA ('000 ha) AND INTENSITIES (%)

Present Without Project/a With Project Small Large Total Small Large Total Small Large Total Farms Farms Area Farms Farms Area Farms Farms Area

Rice (IRRI) 1.7 3.1 4.8 1.8 3.2 5.0 2.1 3.8 5.9 Kharif fodder 5.6 6.2 11.8 5.8 6.3 12.1 6.8 7.7 14.4 Cotton 12.0 19.2 31.2 12.5 19.7 32.1 14.6 23.8 38.4 Rabi fodder 4.7 5.6 10.3 4.9 5.7 10.6 5.7 6.9 12.6 Mustard & rape 2.1 2.5 4.6 2.2 2.5 4.8 2.6 3.1 5.7 Wheat 21.0 31.5 52.6 21.8 32.3 54.2 25.5 39.1 64.6 Sugarcane 4.7 5.6 10.3 4.9 5.7 10.6 5.7 6.9 12.6 TOTALRABI 32.6 45.1 77.8 33.9 46.3 80.2 39.6 56.0 95.6 TOTALKHARIF 24.1 34.0 58.1 25.0 34.9 59.8 29.2 42.2 71.4 ANNUAL 56.7 79.1 135.8 58.8 81.1 140.0 68.7 98.2 166.9 Intensities Rabi 76.0 73.0 74.2 78.9 74.9 76.5 92.1 90.6 91.2 Kharif 56.0 55.0 55.4 58.1 56.4 57.1 67.9 68.3 68.1 Annual 132.0 128.0 129.6 137.0 131.3 133.6 160.0 158.8 159.3

/a Future with OFWM. Note: 41% of the project area is assumed to be under small farms (3.5 ha) and 59% under large farms (11 ha).

(about 37% and 24% over the without project situation). The production increase in areas under large farms is higher than under small farms, essentially because of higher input use. The total value of incremental production in constant FY92 prices would be close to Rs 167 million annually (see Annex 9, Table 2), of which

17/ The Indus Basin Model Revised uses an optimization framework and with input and output coefficients provides interaction between cropping activities, water use, and available water supply. Details on the model and its adaptation for the project are available in the project file. - 35 -

cotton, wheat and sugarcane would be about Rs 137 million (82%), and fodder (kharif and rabi) about Rs 21 million (13%).

Table 6.2: ESTIMATED CROP PRODUCTION ('000 tons)

Main OutRuts By-Products Incre- Without With mental Without With Present Project Project (%) Present Project Project

Rice (IRRI) 7.6 7.8 9.3 19.4 13.7 14.1 8.4 Cotton 31.7 39.0 53.6 37.3 25.4 31.2 21.4 Kharif fodder 227.9 235.1 279.6 18.9 Rabi fodder 277.5 286.2 346.6 21.1 Mustard & rape 3.7 3.8 5.1 34.9 2.4 2.4 1.6 Sugarcane 311.2 320.7 433.4 35.1 40.5 41.7 28.2 Wheat 79.8 94.8 117.2 23.7 119.6 142.1 87.9

Marketing and Prices

6.5 Marketing arrangementsfor the farm output are described in chapter II. The project's incrementalproduction would be relatively small and demand is expected to rise -- in view of a fast growing population and establishedexport markets (cotton, rice) -- annual incrementaloutput should be readily absorbed. Fodder would essentiallybe used on the farm.

6.6 Farmers are assumed to receive and pay fixed prices for commodities subject to government regulation and market prices for all others. FY92 farmgate prices used in the financial analysis are shown in Annex 9, Table 4.

Farm Income

6.7 The two farm models chosen for the project have been designed to represent typical cropping patterns, cultivationpractices, input usage, and yields. Budgets prepared for these models show an increase in net annual income of 39% (in constant FY92 prices) for the small and 45% for the large farm at full development. A summary of income per farm is given in Table 6.3 and detailed budgets are in Annex 9, Tables 2 and 3. Benefits to farmers located at the tail of minors and watercoursesvould generally be greater than those accruing to farmers located at the head. The project's impact on tenants' income would vary depending on tenancy arrangements,but income would generally be about one-half to two-thirds of the incremental income of owner/operators.

Table 6.3: INCOME PER FARM ('000 Rupees)

Without With Incremental Present Project Project 000 Rs

Small farms 10.52 14.17 19.68 5.51 39 Large farms 20.52 39.51 57.61 18.10 46 Total area 16.80 22.13 31.45 9.32 42 - 36 -

VII. BENEFITS AND JUSTIFICATION

Production and Employment

7.1 The project would raise agriculturalproduction and incomes by improving the irrigationsystem and providinp surface drainage over a command area of about 104,800 ha. About 17,900 farm families or about 143,000 people would directly benefit. Their present annual per capita income from cropping activitiesof between US$50 (small farm) and US$150 equivalent (large farm) compares with a per capita GNP of US$375 (1990 World Bank estimate). Population in the project area is projected to double by the year 2015. Without the project, underemploymentis likely to increase. With the project, total farm labor requirementswould reach about 9 million workdays per year at full development (2001) -- an increase of 12% over the present situation -- providing additional employmentopportunities in the area. Constructionactivities would also generate employmentduring the implementationperiod. The project would cover mostly saline groundwater areas, where farm incomes are generally lower than in fresh groundwater areas, and would benefit farmers at the tail end of canals and watercourseswhose incomes had been depressedbecause planned water supplies did not reach their land. It would thus improve living conditions of the poorer section of the farming community. Involvementof women would follow the pattern traditionallyassociated with irrigatedagriculture in Pakistan, with women participatingin farm work but not in water management.

Other Benefits

7.2 Storm water drainage would reduce the long-term effect of inadequate drainage on buildings, roads and utility lines, reducing the maintenance cost of these facilities. Surface drainage would also improve health and sanitation conditions. Provision of electrical power for the interceptordrains would also benefit the project area. These indirect (unquantified)benefits would contributeto improving the living standard of the predominantlyrural population.

7.3 The research component and Phase 2 preparationwould benefit the water sector as a whole. They would provide answers to several key questions needed for water sector development in the 'post water allocations'era. Research component would provide guidance in fully utilizing the available resources in highly saline and waterlogged environment. It would also provide a model for integratingthe irrigationand agriculturalactivities and make proposals for converting the surface irrigationsystem to a demand based system.

Economic Analysis

7.4 The economic rate of return (ERR) of the project is estimated to be 22%. Economic benefits and costs given in Annex 10, Table 1 have been calculated in constant FY92 prices. The main assumptionsmade in the analysis are as follows:

(a) Project Life: Twenty six years (twenty years after the completion of the project), with full developmentreached in project year 9, three years after the completion of works -- the build-up of benefits would take four years for each bati.hof improvements.

(b) Prices: Farmgate prices for internationallytraded goods are based on World Bank commodity price forecasts,while those fcr non-traded goods are based on domestic financial prices (Annex 9, Table 4). Among traded - 37 -

goods, export parity prices have been used for cotton, rice and sugarcane, and import parity prices for wheat and fertllizers. The market wage for labor as well as other domestic prices and price componentshave been translated into border prices by applying a standard conversion factor of 0.9.

(c) Proiect Benefits: Benefits consist of the estimated incrementalcrop production described in Chapter VI.

(d) Proiect Costs: All investmentcosts, incrementalcrop production and O&M costs have been taken into account.

Sensitivityand Risks

7.5 The project's ERR of 22% has been calculatedwith conservative assumption concerning farmers' future cropping patterns. The project improvementswould allow for greater flexibility in regulationof the surface water supply to the area, and with more timely water supply the cropping pattern is expected to shift towards more profitable crops. Assuming a 5% shift in the cropping pattern accompaniedby reallocationof 5% of currently available surface water within each season, the ERR increases to 34%.

7.6 The sensitivityof the project to changes in benefits and costs has been tested using switchingvalues 18 as a measure. A discount rate of 10% (the assumed opportunity cost of capital in Pakistan)was used. The results show that costs could increase by 200% or benefits reduce by 49% without making the project economicallyunacceptable.

7.7 The project could face the risk of implementationdelays due to (i) limited capacity of the local constructionindustry, and agencies' and contractors'relative unfamiliaritywith envisaged constructiontechniques (canal lining with geo-membrane, interceptordrains); and (ii) shortage of local funding. Interceptordrains, although new in Punjab, have already been installed in Sindh under LBOD. Hard surface lining has been provided in several canals in the Indus irrigationsystem, including the 6-R distributary(under CWNP), which is part of the Sadiqia canal system. Other types of membranes have been used together with hard surface lining (such as asphaltic membrane in the Sidhnai- Mailsi-Bahawallink in the southeast of the project area), but geo-membranewould be used for the first time in Pakistan. It is expected that with appropriate choice of bidding procedures (ICB), careful selection of local contractors, proper specifications,design criteria, and quality control delays due to the first cause can be minimized. It is hoped that, as in the past, GOP and COPunjab would give priority to the project in budget allocations,eliminating the risk of implementationdelays due to the second cause.

7.8 Other Risks. The Federal Shariat Court of Pakistan has recently given a ruling that the Shariah does not permit the payment or award of interest and thus, has instructedthe Government to modify a number of existing laws that currently provide for payment of interest. The Governmenthas filed an appeal with the Supreme Court against the Shariat Court ruling, which has been stayed pending the outcome of the appeal. As far as Pakistan'sobligations under loan and credit agreementswith Bank/IDA are concerned,these would be valid and

13/ Switching value is the percentage char.geof the variable tested for vhich the project's net present value is zero, or for which the project's rate of return is equal to the discount rate (usually the opportunity cost of capital). - 38 -

enforceableunder internationallaw, in accordance with the terms of those agreements and the general conditions of Bank/IDA,notwithstanding any local law or judicial decision regarding the payment of interest and other charges, including any such ruling.

Environmental Issues

7.9 The proposed project has been reviewed under the provisions of OperationalDirective 4.00, Annex A, "EnvironmentalAssessment" and placed in environmentalscreening category B. The project will not require the preparation of an environmentalassessment; however, designs used for project funded activities will be reviewed to minimize environmentalimpact. Typical of most water management projects, the project would have an overall positive impact on the environment. It builds on existing infrastructureand improves systems operation. Hence, it would not create adverse environmentaleffects normally associated with new development,such as resettlement,depletion of land and water resources, and loss of wildlife habitat. Drainage of several small temporary ponds scattered throughou. the area, and improved water management would reduce deep percolation to the groundwater and offset, or delay, problems of waterloggingand related soil salinity. Water management would also reduce the incidenceof mosquito-bornediseases by reducing the habitat of mosquitos: stagnant water seeping from deterioratedcanals and unimproved watercourses.

VIII. AGREEMENTSREACHED AND RECOMMENDATIONS

8.1 Assurances were obtained during negotiationsfrom GOP, GOPunjaband WAPDA,as appropriate, that:

(a) specifications,design criteria and quality control measures used for constructionof interceptor and surface drains, canal lining and other civil works would be acceptable to IDA (para 3.6);

(b) surface water supply to the project area would be adequate and operation of channels would be modified to meet crop water requirementsas closely as possible (para 3.7 );

(c) improvementof watercourses in the project area would be completed by June 30, 1995 (para 3.9);

(d) timely completion of on-going surface drainage contracts would be ensured and coordinatedwith the constructionof surface drains under the project (para 3.10);

(e) a draft report containing proposals for formalizing farmer organizations,and detailed design of a demand based irrigation scheduling system would be submitted for the Bank's review by September 30, 1993 and the proposed pilot programs would be implemented during the project implementationperiod (para 3.19);

(f) consultants for design, and constructionsupervision of all components would be recruited, following Bank guidelines (par& 3.22);

(g) all implementingagencies in VAPDA, PID and PAD would maintain separate accounts for the project; the accounts (includingSpecial Accounts) would be audited annually by independentauditors acceptable to IDA; and - 39 -

copies of audit reports, including separate opinions of the au-itors on reimbursementsclaimed on the basis of SOEs, and on the operation of the Special Accounts would be submitted vithin nine months of the end of each fiscal year (para 4.6);

(h) all implementingagencies would furnish annual work programs to IDA for its concurrenceby March 31 for the following fiscal year starting from FY93 (para 5.12);

(i) SMO would submit an overall monitoringand evaluationprogram defining precise responsibilitiesof various agencies (along with draft inter- and intra-agencyagreements) and providing detailed scope of work for IDA approval by December 31, 1992 (para 5.19);

(j) Punjab will discuss with IDA by February 15 of each fiscal year beginning with FY93, the level of funding required for operation ard maintenance of the surface irrigation,fresh groundwater tubewells and drainage facilities in Punjab for the following fiscal year, and based on mutually agreed funding levels, provide adequate budgetary allocations (para 5.21);

(k) Punjab shall, through water and/or drainage charges: (i) by July 1, 1993 achieve a recovery level of at least 35% of the annual O&M cost of its surface irrigation,fresh groundwa_.ertubewell and drainage facilities; (ii) by July 1, 1994 achieve c recovery level of at least 45% of such cost; (iii) by July 1, 1995, achieve a recovery level of at least 55% of such cost; (iv) by July 1, 1996, achieve a recovery level of at least 70% of such cost; (v) by July 1, 1997, achieve a recovery level of at least 90% of such cost; and (vi) by July 1, 1998, achieve and thereafter maintain a recovery level of 100% of such cost (para 5.22); and

(1) a mid-term review, the terms of reference of which would be sent to IDA for its concurrence six months prior to review, would be undertaken jointly by VAPDA, GOPunjab and IDA during the third year of the implementation,but not latter than March 31, 1995 (para 5.26);

8.2 The following would be the conditions of effectiveness:(i) VAPDA, PID and PAD have completed the evaluationof proposals for consulting services and have furnished the evaluationreports to IDA (para 3.22); (ii) approval of project PC-1 by ECNEC (pars 4.2); and (iii) appointment of Project Directors by VAPDA and PID along with associated staff (paras 5.3 and 5.7).

8.3 With the above assurances and conditions, the proposed project would be suitable for an IDA credit of SDR 39.6 million (US$54.20million equivalent) on standard terms with 35 years maturity. The borrower would be the Islamic Republic of Pakistan. - 40 -

PAKISTAN Annex-1 FORDWAH EASTERN SADIQIA (SOUTH) Table 1 IRRIGATIONAND DRAINAgE PROJECT

Physical Features

Canal Name Channel GCA CCA Number Authorized Actual Type Acres Acres Water- Discharge Discharge courses (CFS) (CFS)

Eastern Sadigia (Total) N 297,604 258,701 668 5230/6280 5900

Girdgarivala DY 4,033 3,041 9 13 15

Sirajvah (Total) DY 49,176 44,421 113 197 217 Direct outlets WC 18,081 15,679 37 58 70 Najibvah MR 9,793 9,475 27 39 43 Bahadarwah MR 20,367 18,350 47 82 90 l-R/Bahadarvah MR 935 917 2 3.6 4

Malik Branch (Total) BR 48,392 41,302 89 1538 1900 Direct Outlets WC 15,739 12,465 22 47 52 Bhukan DY 5,369 3,835 10 13 15 Murad DY 22,402 21,002 46 595 690 Haran MR 3,940 3,103 9 69 76 Shadab SMR 942 897 2 3.5 6

Hakra Branch (Total) BR 196,003 169,937 457 2708 2900 Direct outlets WC 22,240 19,285 45 35 42 Bhaku Shah DY 1,569 1,514 3 6 7 1-R Sunder DY 5,123 4,990 11 19 20 2-R Dunga DY 6,764 5,643 14 20 24

3-R Khattan (Total) DY 81,195 70,316 186 307 368 Direct outlets WC 51,365 45,334 116 168 186 1-R Qazivala MR 19,552 16,779 46 66 79 1-L Jourkanvala MR 8,144 6,408 19 27 34 2-L MR 2,134 1,795 5 7 8.4

4-R Harunabad (Total)DY 49,439 44,307 129 189 218 Direct outlets WC 30,064 27,609 81 117 140 1-RA Labgsingh MR 6,967 6,077 16 22 28 1-R Badruwala MR 12,408 10,621 32 43 50

1-L Nubarak DY 18,861 14,500 44 67 80 5-R Bhaghsar DY 10,812 9,382 25 36 47 Total 297,604 258,701 668 Total (ha) 120,530 104,774

Notes: Channel Type, N Main Canal, BR Branch Canal, DY Distributary, MR Minor, SMR Sub-Minor, WC Watercourse - 41 -

An_ex -1 Table 2 PAKISTAN

FORDWAH EASTERN SADIOIA (SOUTH)

IRRIGATIONAND DRAINAGE PROJECT

Channels with Interceptordrains

Channel Total Reach Name Length Discharge Number (feet) Capacity From To Length of Int- (CFS) RD RD (feet) ceptors

1. Sirajvaha Dy 67,500 217 0 67,500 67,500 2 2. Malik Branch 116,900 1,900 3,700 116,900 113,200 1 3. hurad Dy 122,000 690 0 116,000 116,000 1 3. Hakra Branch 296,000 2,900 0 165,000 165,000 2 4. 3-R Khattan 162,231 368 0 104,000 104,000 2 6. 4-R Harunabad 112,050 218 0 58,500 58,500 2

I'3tal 624.200 (190.4 km)

Note: Interceptor drainage system would be installed along the Malik and Hakra Branches and it would be extended to the rest of the channels after evaluating its performance. - 42 -

PAKIS ", Annex I Table 3 FORDWAH EASTERN SAl.OIA (SOUTH)

IRRIGATIONAND DRAINAGE PROJECT

Channels to be lined

Channel Total Reach Name Length Discharge Capacity From To Length (Feet) CFS RD RD Feet Eastern Sadiqia 1. Girdarivala 15,750 13.0 0 15,750 15,750

Sirajwah 2. Najibvaha 56,315 43.0 0 17,760 17,760 3. 1-R Bahadarwah 5,500 4.0 0 5,500 5,500 4. Bahadarwah MR 60,139 90.0 0 37,300 37,300 5. " " 35.0 37,300 60,139 22,839

Malik Branch 6. Bhukan 23,040 15.0 0 23,040 23,040 Haran 7. Shadab 5,250 6.0 0 5,250 5,250

Hakra Branch 8. Bhaku Shah 2,740 7.0 0 2,740 2,740 9. 1-R Sunder 12,150 20.0 0 12,150 12,150 10. 2-R Dunga Bunga 33,720 24.0 0 33,720 33,720 11. 3-R Khatan 162,301 120.0 104,000 147,950 43,950 12. n n 34.8 147,950 162,300 14,350 13. 1-R Qaziwala 59,100 79.0 0 29,675 29,675 14. " of 34.8 29,675 59,100 29,425 15. 1-L Jourkanvala 33,900 34.0 0 33,900 33,900 16. 2-L 10,000 8.4 0 10,000 10,000 17. 4-R Harunabad 112,050 115.0 58,500 89,179 30,679 18. n n 34.0 89,179 112,050 22,871 19. 1-RA Labhsingh 22,000 28.0 0 22,000 22,000 20. 1-R Badruwala 50,623 50.0 0 12,515 12,515 21. n n 36.0 12,515 50,623 38,108 22. 1-L Mubarak 77,750 80.0 0 48,800 48,800 23. " " 34.8 48,800 77,750 28,950 24. 5-R Bhaghsar 34,270 47.0 0 34,270 34,270

Total 575,542 (175.5 km) - 43 -

PAKISTA ANNEX I Table 4

FORDWAHEASTERN SADIOIA (SOUTH)

IRRIGATION AND DRAINAGEPROJECT

Contracts for Surface Drains

Prom To Progress in percent Contract Name RD RD Upto December 1991 Number (feet) (feet) Financial Earth Struct- Work ures 1 SC-1 PID Outfall DR 0 79,680 76 84 71 2 SC-2 PID Harunabad DR 0 27,485 43 67 30 Dahranvala DR 0 37,000 3 SC-3 PID Shaheed DR 0 43,692 53 64 51 Doshakh DR 0 12,000 4 SC-4 PID Harunabad DR 27,458 121,412 23 43 19 5-L Harunabad DR 0 5,000 5 SC-5 PID Baghsar DR 0 51,573 Design completed. Badruwala DR 0 17,095 6 SC-6 PID Baghsar DR 51,573 136,920 Design completed. 7 NC-7 W Jandwala DR 0 91,000 5 9 3 Qazivala DR 0 31,906 8 NC-S V Jandwala DR 91,000 201,090 3 7 9 NC-9 v Harunabad DR 160,161 269,642 Design in progress. 1-L Harunabad DR 0 16,689 10 NC-12 U Khetran DR 0 59,576 3 11 1-L Rhetran DR 0 42,071 11 NC-13 V Harunabad 121,412 160,161 Design in progress. 4-L Harunabad 0 32,244 3-L Harunabad 0 20,979 2-L Harunabad 0 25,995 12 SC-7 PID Work in the Evaporation Ponds Design in progress.

Total 1,031,484 (314.4 km) - 44 -

P-AXISTAN Table 5

FORDWAHEASTERN SADIOIA (SQUTH)

IRRIGATION ANTDDRAINAGE PROJECT

Planned drains

Contract Name of the Drain From To Number RD RD (feet) (feet) 1 SC-1 PID Outfall DR 0 79,680 2 SC-2 PID Harunabad DR 0 27,458 SC-4 PID Harunabad DR 27,458 121,412 NC-13 Harunabad DR 121,412 160,161 NC-9 Harunabad DR 160,161 269,642 3 SC-4 PID 5-L Harunabad DR 0 5,000 4 NC-13 4-L Harunabad 0 32,244 5 NC-13 3-L Harunabad 0 20,979 6 NC-13 2-L Harunabad 0 25,995 7 NC-9 1-L Harunabad DR 0 16,689 8 SC-2 PID Dahranwala DR 0 37,000 9 SC-3 PID Shaheed DR 0 43,692 10 SC-3 PID Doshakh DR 0 12,000 11 SC-5 PID Baghsar DR 0 51,573 SC-6 PID Baghsar DR 51,573 136,920 12 SC-5 PID Badruwala DR 0 17,095 13 NC-7 W Jandwala DR 0 91,000 NC-8 W Jandwala DR 91,000 201,090 14 NC-7 V Qazivala DR 0 31,906 15 NC-12 V Rhetran DR 0 59,576 16 NC-12 V 1-L Khetran DR 0 42,071 Total 1,031,484 (314.4 km) Additional Drains

Drain Length Outfall Drain Name (Feet) Drain Name At RD

1 AD-1 10,000 Jandwala Drain 201,090 2 AD-2 9,354 Jandwala Drain 9,350 3 AD-3 10,450 Jandwala Drain 90,000 4 AD-4 10,890 Jandwala Drain 67,500 5 AD-5 19,580 Jandwala Drain 40,000 6 AD-6 30,360 Jandwala Drain 42,000 7 AD-7 7,000 1L- Haroonabad Drain 16,689 8 AD-8 15,340 Baghsar Drain 135,000 9 AD-9 9,750 3L-Ha-oonabadDrain 20,000 Total 122,724 (37.4 km) - 45 -

Annex I Table 6 PAKISTAN

FORDWAHEASTERN SADIUIA (SOUTH)

IRRIGATION AND DRAINAGEPROJECT

Cost Estimate for Surface drains

Cost Contract Drain From To Million Number Name RD RD Rupees Prices

1 SC-5 PID Baghsar DR 0 51,573 20.7 Badruwala DR 0 17,095 2 SC-6 PID Baghsar DR 51,573 136,920 25.8 3 NC-9 V Harunabad DR 160,161 269,642 32.4 1-L Harunabad DR 0 16,689 4 NC-13 V Harunabad 121,412 160,161 50.9 4-L Harunabad 0 32,244 3-L Harunabad 0 20,979 2-L Harunabad 0 25,995

5 SC-7 PID Work in Evaporation 12.0 Ponds

Sub-Total 398,152 141.8 (121.4 km)

6 Ad-i to Ad-9 Additional drains 122,724 17.0 (37.4 km)

Total 158.8 - 46 -

PAKISTAN Annex 2 FORDWAH EASTERN SADIOIA (SOUTH) Page 1 IRRIGATIONAND DRAINAGE PROJECT

SubsurfaceDrainage Field Trial Details

1. The drainage field trials to be installed during the first phase of the project are designed to test subsurfacedrainage parametersand geotextile filter material for use as a protective envelope around pipe. The main subsurfacedrainage parameters requiring field testing are drainage coefficients,drain spacing and drain depth. This tes_'ng can be completed in a relative short period (2 - 3 years). The establishmentof the agricultural responses to improved drainage (crop yield, cropping patterns, economic return, etc.) will take more time. It is, however, recommended that these long-term objectives are taken into account in the site selection and design of the test areas.

2. The field trial research will be entrusted to the International Waterlogging and Salinity Resec.rchInstitute (IWASRI). Overall implementation arrangementsfor this component are given in Chapter V. IWASRI has already engaged two internationalconsultants to assist with the site selection and formulationof the research program. About three to six test sites would be selected, ranging in size from 60 ha to 405 ha. These sites, located in presently waterlogged and salinizedareas, adequatelycover the variation in the prevailing soil and (geo) hydrologicalconditions of the project area.

3. Layout of the drainage field trial areas also involves considerationof the in-situ hydraulic conductivityand other considerations to evaluate the cost and effectivenessrelationships involving installation, operation and maintenance. Thus, the test fields will involve laying horizontal pipe drains at an average depth of 1.7 m (5.5 feet), and 2.4 m (8.0 feet). Drain spacing was calculatedusing Ernst's Equation for layered soils and resulted in test area spacings that will range from 80 m (250 feet) to 30C m (1000 feet) depending on soil parametersand drain depth. The testing of drain spacings will involve three differentvariables which are the calculated drain spacing, one half of the calculatedspacing and twice the calculated spacing. An appropriate buffer zone is necessary between each layout pattern. Drain lengths are generally at least four time the drain spacing and have two replicationsto properly test the parameters.River-run gravel envelope material which has proved to be effective under the project conditions is to be used for testing the drainage parameters in these primary test fields.

4. Since cost of the river-run gravel envelope is extremely high, a lower cost envelope is to be field tested for this project and for potential use in other regions. Laboratorytests have been performed and indicate that a composite envelope consistingof a synthetic fabric (geotextilefilter) material wrapped around the horizontal pipe drain which is surroundedby local sand will protect the drains from sediment deposition. Thus, at each test site comparisonswill be made between the performanceof different types of pipe envelope (gravel envelope, geotextileand - 47 -

Annex 2 Page 2

sand envelope and plain geotextile envelope). These envelope tests will be o..ce in the standardspacine blocks of the trial areas. Extra drain lines will be provided in these blocks for this envelope testing to avoid interactionwith the drain depth/spacingtesting. At some locations, envelope testing will also be done on the interceptionpipe drains which are planned to be installed along the branch irrigation canals.

5. Pipe sizes for the field trial areas have been calculatedusing acceptable professionalengineering standards. The gradient for the laterals has been selected as 0.001 while for collectors a gradient of 0.005 has been adopted. Manholes are to be provided for dischargemeasurements and for other observationssuch as sediment deposition as well as routine maintenance. Observationwells are provided for measuring water table fluctuations. The arrangement of observation wells is based on the recommendationsgiven in FAO paper 28 "Drainage Testing". Sumps will be provided for collecting water from the test areas and disposal into nearby canals where appropriate.

6. Observationswill be made to evaluate the performance of all trial areas. Variation of water table during the irrigation and rainfall seasons, impact on salt balance in the root zone, impact on crop production and other items that could impact drainage design and layout will be measured. The trials will provide the basis for subsurface drainage research needed to prepare the design of phase 2 properly. It would result in a great deal of transferableresearch on drainage design criteria, suitable depths for drain pipe, improved constructionmethods for pipe drains, and how better advantage can be taken of water tables for subirrigatingcrops to supplement crop water needs.

7. Since experiencesat other drainage projects in the country have shown that the design and performanceof subsurface drainage systems is much influenced by the regional groundwaterregime, a regional groundwater balance/flowmodel would be developed. This model would be used for the: ti) interpretationand evaluation of the observationson the trial areas; (ii) evaluation of the effects of the planned anti-canal seepage measures (interceptiondrainage and lining) and of the planned surface drainage improvementmeasures, all of which measures would effect the groundwater balance; and (iii) analysis of the potential seepage hazard posed by the planned evaporation ponds and disposal of sub-surfacedrainage effluent from phase 2.

8. The findings of the research would be applicable in the design of sub-surfacedrainage projects in the whole basin and would add to the internationalknowledge in the drainage field. Almost all of this adaptive research work is included in a new research effort recommendedby the InternationalProgram for Technology Research in Irrigation and Drainage (IPTRID) and will help improve the quality and cost effectivenessof future similar projects in Pakistan. - 48 -

PAKISTAN Annex 3 Page 1 FORDWAH EASTERN SADIOIA (SOUTH)

IRRIGATION AND DRAINAGE PROJECT

Monitoring of Land and Water Conditions

1. The proposed project would implementa number of water conservationmeasures which will reduce the recharge to the groundwater. These measures are interceptordrains along the branch cenals, lining of distributariesand minors, watercourse improvementsand surface drains. The impact of these measures on the groundwatertable is difficult to quantify precisely in advance. Therefore, a program to monitor the Land and Water conditions in the project area to assess the impact of the proposed measures is included in the project. Assessment of the effects and performance of these measures is of considerableimportance both to quantify the project impact and to assess the subsurface drainage requirementsfor Phase 2. The monitoring program would also provide useful informationfor planning and design of other waterloggingand salinity control projects in the country.

2. Although the main objective of the monitoring program is to monitor the combined effect of all the measures, to the extent possible, the performance of each measure would also be monitored separately. It is anticipated that the latter monitoring will provide sufficient informationon the a technical functioning to improve the design of new projects.

3. The main components of the monitoring program are general monitoring, specific monitoring and monitoring of sub-surfacefield trials. General monitoring would cover the whole project area and monitor the groundwater levels, groundwaterquality, soil salinity, and water inflows and outflows in order to prepare a water balance for the area. The Specific monitoring would be aimed at assessing the performance of individual component of the project. Monitoring of field trails (described in Annex 2) would provide data required to develop the design parameters for tile drainage.

General Monitoring

4. GroundwaterMoinitoring The groundwatermonitoring is a major component of the monitoring program in which a network of observationwells would be installed. The alignment, coverage, and density of this network would be designed to provide an adequate, reliable quantitativeevaluation of the impact of the implementedwater conservationmeasures on the watertable and on the groundwater quality. The same network will also be used to develop the groundwater model referred in Annex 2.

5. The SNO which has ample experience with this type of monitoring would be responsible for the detailed design of the groundwater observation network. The network would be aligned along the groundwater - 49 -

Annex 3 Page 2

contours with higher densities perpendicularto the contours and lower intensitiesparallel to the contours. The coverage should be in line with the coverage of the water conservationmeasures. Generally the network will have a 1-2 km grid.

6. At the grid points regular observationson watertable depth and groundwater salinity will be made. Observation timings and frequency again should be guided by SMO experiences,but it is expected that two observations per year (pre-monsoonand end-monsoon)will suffice. The observationswill be made in standard wells. All watertable reading will be converted to reduced levels to allow the preparation of watertable contour maps. The groundwater salinity will be measured on samples taken from these wells. Before sampling, the wells should be pumped to assure that the salinity of the well water reflects the salinity of the surrounding groundwater.

7. Soil SalinitX The the soil salinity monitoring will also, as much as possible, follow the standard SMO procedures. The required informationdensity is expected to be of the order of one location per 5-10 ha with samples taken at two depths (10 cm and 30 cm below soil surface). Analyses of the samples on EC and SAR, both in a 1:1 soil/water ratio, would suffice. It is further suggested that the soil salinity sampling be done twice per year at the pre-monsoon and post-monsoontiming also selected for the groundwatermonitoring. The procedures and technology provided under the Improved Technology for Planning and Monitoring component (to carry out salinity mapping at a high speed) would be used to the extent possible.

8. In addition to the conventionalmonitoring based on field observations and field sampling, possibilitiesfor use of modern remote sensing technology to assess the impact of the water conservationmeasures would also be explored.

9. The monitoring should preferably start at least one year prior to implementationof the water conservationmeasures. The pre-implementation conditions would establish a reference base (baseline)against which the impacts of the implementedmeasures can be assessed. The implementationis likely to take a number of years. The actual implementationof the different measures should be carefully recorded as it constitutes important information to be used in the evaluation of the collected data.

10. The collected data would be processed, analyzed and reported within three months after observationdate. The observed data should be reported in tabular form as well as in mapped form (watertabledepth, groundwater contour, groundwater salinity and soil salinity). A map scale in the order of 1:50,000 would be suitable.

11. HydroloeicalMonitoring To prepare the water balance data on all the inflows and outflows to the area such as, rainfall, evaporation,canal water diversions, estimates of tubewell pumpage, reuse of water from surface drains would be collected. Data on most of these parameters is being - 50 -

Annex 3 Page 3

collected by the implementingagencies. Therefore, this effort is essentially to gather the data bring in a format useable for the water balance studies as well as for the developmentof groundwater model.

Specific Monitoring

12. The specific monitoring will be designed to evaluate the technical performance of the different specific measures. This monitoringwould be at specific locations only and restricted to the interception,lining and surface drainage measures. The watercourse improvementshave been evaluated in a number of other projects.

13. The performance of the interceptiondrains will be evaluated on the basis of: (i) watertable levels in observation lines across the canals and drains; (ii) the interceptedseepage flows as measured in the pumped sumps; and (iii) the salinity of the interceptedwater. About five such cross- sectional observation stations will be established. The performance of lining will be evaluated by the "inflow and outflow method" on about lOX of the lined canals. These measurementswould be repeated one and two years after the constructionof the lining. These activitieswould be coordinatedwith the research component on Performance of Canal lining. To monitor the surface drains, gaging stations will be installed on a number of surface drains at the outfall points. Rating curves will be established for each station and a sufficientnumber of discharge events will be recorded to evaluate capacity requirements. The drains would be monitored for the water quality, extent of scouring and silting, as well as weed growth. Special monitoring would also be carried out in the areas adjacent to the evaporationponds. Watertable elevationsand groundwater quality surrounding the ponds would be monitored to assess the impact of ponding on the adjacent lands.

Monitoring of the Field Trials for Subsurface Drainage Research

14. The field trials would require an intensivemonitoring program designed specificallyto collect data to estimate the drainage parameters as described in Annex 2. Details of this program and the frequency of observationswould be determinedafter the completionof detailed design of the field trials. Furthermore,adjustments would made in the collection procedures and frequency as required during the course of the research program. The monitoring will be coordinatedwith the activities under the Irrigation and Drainage research component. - 51 -

PAKISTAN Annex 4 Page 1 FORDWAHE&STERN $ADIOIA (SOUTH) IRRIGATION AND DRAINAGEPROJECT

Irrigationand Drainage Research

1. The research component consists of the following five subcomponents:(i) evaluation of the impact of waterloggingand salinity on crop production; (ii) introductionof improved technologyfor planning and monitoring irrigationand drainage projects, and land and water conditions in general; (iii) assessing perfozmance of different types of canal lining; (iv) improvementof irrigationmanagement with a view to match irrigation supply with crop water demand i.e integratedirrigated agriculturemanagement; and (v) Agriculture extension support. The four themes of research should be seen as organically linked and close interactionwill be maintained for the exchange of data and results. The extension component would focus on the specific needs of the project area and would be instrumentalin wider application of the results of waterloggingand salinity research.

(i) Impact of Waterlogging and Salinity on Crop Production.

2. Degradation of soil and water resources due to vaterloggingand salinity is increasing. Current efforts to intensify agriculturalproduction and increase yields per unit area have to include innovative methods of controlling and reversing the present trends of salinizationand waterlogging in the project area. In order to understand the cause and effect relationship of this twin menace to crop productionmore precisely and to improve the basis for preparation of policies and projects in similar areas, research activities --mainly through research in farmers' fields-- would aim at attaining the following objectives:

(a) to quantify the interactionsamong irrigation and agronomic practices that significantlyaffect farmers' yields under actual farm conditions; in particular, the individualand combined impact of waterlogging and salinity on the yields of major crops will be determined;

(b) to determine the optimal levels of irrigation of the existing cropping pattern;

(c) to propose adjustments in the cropping pattern to suit waterlogging and salinity conditions,salinity resistant varieties, and saline agriculture;

(d) to determine the potential for use of marginally fresh and saline water, including drainage water from the proposed drainage scheme of the overall project, for crop irrigation.

3. Field trial sites for subsurfacedrainage would be used where control over varying water table depths, salt levels and controlled/measured irrigation applicationsand other cropping activities is required.

(ii) Improved Technolomv for Monitoring and Planning.

4. To enhance the Government'smonitoring and planning capabilities, - 52 -

Annex 4 Page 2

the project would test and adapt modern technology in data collection, storage, and analysis with respect to:

(a) intensivelymeasuring, monitoring and mapping soil salinity in relation to other factors (depth of groundwater,depth in root zone, irrigation practices, soil characteristics,drainage layout, etc.);

(b) preparing of a computerizeddata storage and analysis system through the adaptation of an appropriategeographic information system (GIS). This system will be used for the localized assessment of crop production constraints,management needs, adequacy of drainage systems, drainage needs by location, and irrigation infiltrationuniformity, etc.; and

(c) collecting "feedback" informationof soil, crop, and water characteristicas needed to plan, schedule, and control irrigation/drainageand to maximize water-use efficiency and crop yield while minimizing drainage and associated disposal problems.

(iii) Performance of Different Topes of Lining.

5. The lining of canals has been practiced in Pakistan since the 1930s. There has been, however, no thorough evaluation of past and present experience in lining. The Punjab Irrigation Institute is currently conducting laboratory and field research on the use of membrane materials for lining. This research, however, is limited in scope.

6. The performanceof different types of canal lining currently employed in Pakistan with respect to seepage control, longevity, kydraulic performance and sedimentationwould be evaluated. Studies would be undertaken to select the appropriate types of canal lining for seepage control and their method of installationin canals under continuous operation except short durations of closure for annual maintenance. This would require evaluating the performance of lined canals in Pakistan and other regional countries following comparable constructionpractices as well as an international literature search to identify types of canal lining appropriate for adaptation to the local availability of materials, construction practices and quality control standards. Selected methods of lining would be tested on a pilot scale by field installationin representativesections of main canal, distributariesand watercourses. The study would lead to drawing up technical specificationsfor the recommended type(s) of lining and their method of installationfor minimal interruptionof irrigation supply, supported by design parameters. costs and economic evaluation for application to fresh and saline groundwater areas respectively.

(iv) Integrated IrrigatedAgriculture Management.

7. Integrationof irrigation and agriculture is essential for realizing the full benefits of the investment in irrigation. A pilot project covering two distributarieswithin the project area would be undertaken to test hov the operation of the existing irrigation system could be converted - 53 -

Annex 4 Page 3

to a "demand based" and how the farmers groups can participate in the decision making. The objective is to develop and implementpilot programs aimed to test the structural,organizational, and institutionalarrangements required to supply water to the crops as and when required and to bring farmers and farmer groups into the management and maintenance of the irrigation system.

8. Under the Command Water Management (CWM) Project (Cr. 1487-PAK) a good start has been made in improving management of irrigated agriculture in selected canal commands by improving cooperationbetween the Provincial Agriculture (PAD) and Irrigation (PID) Departmentsand involving farmers in decision making'. This research component would build upon this experience and provide answers to critical questions relevant to irrigated agriculture. The main thrust of the research would be on developing replicable models for (i) strengtheningand formalizing farmer institutions(e.g. WUAs federations and canal committees); (ii) providing farmer institutionsa stronger voice in decision making and a formal role in operation and maintenance of the irrigation system, and developing a frame work for addressing legal and social constraints in this regard; (iii) improving scheduling of water deliveries to better match crop requirementsby introducing,structural, operational and management improvements;and (iv) introducingappropriate site specific cropping patterns, cultural practices and input management.

9. The canal supplies to the project area are short in some months, and surplus water is supplied in others. Because the area is in the command of Mangla reservoir the water diversions could be regulated to a great extent to suit the irrigation demand provided an appropriate decision making system is in place. With the provision of increased canal capacity and better control through lining and improved control structures, it should be possible to operate the channels according to the fluctuationsin water demand.

10. To study the feasibilityof modern irrigation scheduling and iistribut:on,two distributarieswould be selected. Since farmer involvement is a prerequisite for preparing appropriate designs, and subsequent operation, of a "demand based" distributionsystem, the research would initially focus on strengtheningfarmer institutionsand preparing a frame work for assigning them a formal role in O&M. An interdisciplinaryteam of staff assigned from the Directorate of CWM would carry out diagnostic surveys in the command areas of the selected distributariesto identify physical, agronomic, social, legal and operational constraints to improving irrigated agriculture,in collaborationwith PID, OPWN, and WAPDA staff, and farmers.

11. The following information,inter alia, would be collected and analyzed: (i) reservoir operations; (ii) diversions into the main canals and branches supplying the selected distributaries;(iii) cropped area; (iv) soel salinity; (v) crop water and leaching requirements;(vi) expected salt

I/ Under the CWMP experience has been gained in: establishing informal federations of VUAs; involvingfarmers in monitoring equity of water deliveries; adjusting cropping patterns according to available water supplies; introducing simple water scheduling and water management technlques;and promoting farmer involvement in improving availabilityof inputs (e.g seed multiplicatlonprograms). - 54 -

Annex 4 Page 4

movement due to subirrigation;(vii) other important factors in the soil- water-plant relationship; and (viii) physical, operational,legal, and social constraints to meeting irrigation and leaching requirements. Technical Assistance would be provided both for institutionaldevelopment and engineering and agronomic aspects. Based on the findings of the diagnostic analysis, and other related studies (e.g. the proposed studies on Institutions and on "Reducing Government Liability")plans would be prepared for integrating irrigation and agriculture. The Directorateof CWM. in associationwith the PID. would submit a draft report containingproposals for formalizing farmers organizations.and conceptual design of a demand based system for the Bank's review bX September 30. 1993. The report would, inter alia: (i) review existing legislation,including, WUAs Ordinance/Actand the Canal and Drainage Act, and formulate amendments or new legal instruments to formalize farmer institutionsand define their role in O&M; (ii) propose designs of canals, structures,and watercourse works, and operational plans for a demand based irrigation system; and (iii) present proposals for farmer involvement in various activities, including operation of interceptordrain sumps, seed multiplicationprograms, and establishmentof community centers and demonstrationsfor transfer of technology.

12. Implementationof civil works (physicaland structural improvements)would be undertaken by the PID and OFWM after the farmer organizationshave been establishedand their roles in implementationand O&M fully defined. Given the research nature of this activity, continuous consultationswith the beneficiarieswould be essential during all stages of design preparation as well as implementationand operation. A flexible approach to implementationwouild be necessary to incorporate farmers' views. Research findings and results from the operation of the demand based system would be incorporatedin the operation of other channels in the project area.

(v) AgriculturalExtension SuRport.

13. The extension component of the research would focus on the specific needs of the project area. In addition to the regular extension program, information on land reclamationtechniques, water management, cultural practices to improve cropping under waterloggingand salinity conditions, salt resistant varieties and crops would be provided to farmers. The extension agency would gather informationon these aspects from research carried out under the project and from other experimentalstations in Pakistan. Field trial sites for subsurface drainage would be used as demonstrationplots and additional plots would be installed as required. Extension service staff would collaborate closely with the OFWN irrigation agronomy teams. Details of the function of extension service are given in chapter V. - 55 -

PISTAN Ax 5 Pase 1 FORDWAIEASTERN SADIOIA (SOUTH)

IRRIGATION AND DRAINAGEPROJECT

List of Eauimnent Base Cost (Rs 000)

Item Uhit Number Uuit Total Cost Cost A. Interceptor drains ad Surface drains

Survey Eauinment

1 Theodolite No. 5 279.84 1,399.20 2 Level with Stand No. 7 22.35 156.45 3 Survey Support Set No. 14 11.17 156.36 4 Diatomat No. 2 316.21 632.42

Sub-total 2,344.45

Office Eauiument and Furniture

5 Type Writers No. 1 11.18 11.18 6 Amonia Printing machine No. 1 121.20 121.20 7 Plain Paper Copier No. 2 168.27 336.54 8 Computer with Printer No. 7 70.00 490.00 9 ScientificCalculators No. 10 0.93 9.30 10 Air conditioners No. 8 20.20 161.60 11 Drawing Instruments Lump Sum 101.00 12 Office Furniture & fixtures Lump Sum 500.00

Sub-total 1,730.82

Machinerv for Operation and Maintenance

13 Tube Clearing Machinery No. 2 143.6 287.20 14 Service truck 4-wheel drive No. 1 723.7 723.70 15 Crane 10 ton No. 1 359.3 359.30 16 Fork lift/Teleporter No. 1 119.8 119.80

Sub-total 1,490.00

Transport

17 4-Wheel Drive 2 door No. 5 600.0 3,000.00 18 4-Wheel Drive 1000 cc No. 15 218.3 3,274.50 19 Car 1000 cc No. 2 216.0 432.00 20 Pick up No. 2 546.0 1,092.00 21 Community van No. 1 600.0 600.00

Sub-total 8,398.50

Total 13.963.77

B. Canal Lining

SurvevingEauiiment

1 Levels with stand No. 18 40.0 720.0 2 Leveling stands No. 36 1.5 54.0 3 Plane tables No. 6 1.0 6.0 4 TelescopicAlidad No. 6 2.0 12.0 5 Magnetic compass No. 6 .7 4.2 6 Binoculars No. 2 1.5 3.0 7 Invar steel tapes No. 18 .4 7.2

Sub-total 806.4 - 56 -

EpWAB EASTERt SADIOZA (e9UTH) Pae 2 IRRIGATION AND DRAINAGEPROJECT List of Emuimnent Base Cost (Re 000)

Item Unit Number Unit Total Cost Cost Flow Measuramant & umiment

8 Fibre glass boat with oars No. 2 40.0 80.0 9 Life Bouys No. 8 .5 4.0 10 Current Meters No. 2 100.0 200.0 11 Wire rope 1/4 and 1/8 Rft 200 .025 5.0 12 Rack and Pinion for hauling weights Set 2 20.0 40.0 13 Meter flumes for water courses (parschel/cut throat) Set 6 5.0 30.0 14 VeLocity rods Set 6 1.0 6.0 15 Eaho Sounders Set 2 100.0 200.0 16 Sounding rods Set 4 .5 2.0 17 Stop watch No. 6 .7 4.2

Sub-total 571.2

Transport,

18 Car No. 1 600.0 600.0 19 Large 4 x 4 Vehicle No. 1 500.0 500.0 20 Jeeps No. 8 250.0 2,000.0 21 Pick-up small No. 6 130.0 780.0

Sub-total 3,880.0

Office eauinment

22 Fax Machine No. 2 30.0 60.0 23 Type Writers/Computers No. 12 30.0 360.0 24 Photo Copier Machine No. 4 75.0 300.0

Sub Total 720.0

Total 53977.0

C. OF4M

Survevina and Precision Land Level.'3 eautiment (New)

1 Laser Levelling Equipment No. 1 1,000 1,000

Office Eauiunent

2 Plain Paper Copier No. 1 100 100 3 Computer with Printer No. 1 100 100 including Soft-ware 4 A/C for Computers No. 1 25 25

Sub-total 225

Transport (Replacement) 5 Field Jeep 4WD(Medium Size) No. 1 600 600 6 Jeep 4WD. (SmaUl Size) No. 2 250 500 7 Motorcycle No. 10 30 300 8 Bicycle No. 15 1.5 23

Sub-total 1,423 Total LAME - 57 -

PAX3SUM Amex S FORDWAB EASTEtN SADIOZA (SOUTH) Page 3 IRRIGATIONAND DRAINAGE PREMCT List of Ecuigmgpt Base Cost (Rs 000)

D. Phase 2 Proverationand MonitorinA

Field Trials for Sub-surfaceDrainage

Item Unit Number Unit Total By By Cost Cost IWASRI Project Surveying,Flow, water levels jnd galinity Measurement

1 Weirs & Gauges No. 60 0.7 42.0 12.0 30.0 2 Data Loggers No. 36 29.3 1,055.0 306.0 749.0 3 Computers,Printers& Plotters 3 146.6 440.0 127.5 312.5 4 Weather Stations No. 2 234.6 469.2 127.5 341.7 S Dumpy Levels No. 1 46.0 46.0 5.0 41.0 6 Staff Rods No. 2 1.2 2.4 2.4 7 ObservationWells No. 1,148 0.4 459.2 5.0 454.2 8 Neutron Prob No. 2 88.0 176.0 127.5 48.5 9 Neutron Access Tubes No. 12 0.6 7.2 2.0 5.2 10 Tensiometer No. 6 22.0 132.0 38.2 93.8 11 Water Level Recorders No. 4 64.5 258.0 127.5 130.5 12 Salinity Measurements Lump sum 255.0 76.5 178.5 13 Potentiometer Lump sum 30.0 10.0 20.0 14 Water stage recorder No. 4 150.0 600.0 600.0 15 Photo copier No. 1 80.0 80.0 80.0

Sub-total 3,087.3

Transport

16 Pick up Large No. 1 500 500.0 500.0 17 Pick up Small No. 2 250 500.0 500.0

Total 3,372.0 964.7 4,087.3

E. Irrigation and Drainage Research

AgriculturalExtension Support

1 Fabricated Cinema Van with No. 1 1,000 1,000 Audio Video accessories (TV Monitor 26 inches, Video cassette Recorder, Public Address system & generator) 2 Slide Projector No. 1 12 12 3 Overhead Projector No. 1 10 10 4 Still Camera 35 mm (SLR) No. 1 20 20 5 Photo copying machine No. 1 140 140 6Typo writer No. 1 15 15

Sub-total 1,197 - 58 -

PAKISTAN Annex 5 Paso 4 FORDWAH EASTERN SADIOIA (SOUTH)

IRRIGATION AND DRAINAGE PROJECT

List of Eauirmcnt Bame Cost (Rs 000)

Item Unit Number By By Unit Total CWMP Project Cost Cost

IntegratedIrriaated Agrioulture ManaRgement

Flow Measurement/FieldEciunment

7 Water Level Recorders No. 8 8 40 320 8 Current Meters No. 4 2 2 145 290 9 Broad Crested Weir Flumes No. 10 10 3 30 10 Audio Video Equipment No. 1 1 200 200 11 Farm implementsand water application equipment Lump sum 600

Sub-total 1,440

Office Eauiument

12 Computers No. 2 2 13 Lap Top computers No. 8 8 25 200 14 Computer Software Lump sum 50 15 Furniture Lump sum 200 16 Fax Machines No. 2 2 30 60

Sub-Total 510

Transport

17 Vehicles No. 11 3 8 200 1,600 18 Motorcycles No. 7 7

Sub-total 1, 600

Total 4.747

Total (Eauirment) 31.423.67 - 59 -

PAKISTAN Anex 6 Fordwah Eastern Sadiqia(South) TableI Irrigation& Drainage Project Rupees (Million)

Projeot Components by Year

Base Costs Total ------__------1993 1994 1995 1996 1997 1998 Rs (m) U3$ (m)

A. InteroeptorDrains 36.35 88.15 109.73 108.75 108.75 108.75 560.49 21.98 B. Canal Lining 29.29 73.33 92.84 92.24 92.24 92.24 472.16 18.52 C. On FarmWater Manageent 6.98 7.24 6.18 0.00 0.00 0.00 20.40 0.80 D. SurfaceDrains 12.02 28.20 35.22 34.80 34.80 34.80 179.86 7.05 E. Monitoring & Phase 2 Prep 2.53 25.86 24.93 22.46 3.60 3.60 82.79 3.25 F. IrrigationDrainage Res. 7.68 24.07 21.19 20.60 22.60 22.60 118.74 4.66 G. Monitoring & Evaluation 0.00 0.50 1.00 2.10 2.10 2.10 7.80 0.31 B. TachnioalAsaist. a Trng. 0.80 4.50 3.70 4.00 4.00 3.00 20.00 0.78 I. FutureProj. Preparation 0.00 0.00 0.00 0.50 12.50 12.50 25.50 1.00

Total BA8ELINE COSTS 95.65 251.65 294.80 285.45 280.59 279.59 1487.74 58.34 Physical Contingencies 4.91 16.35 21.32 21.17 19.63 19.63 103.00 4.04 Price Contingencies 4.57 24.85 50.04 69.85 90.50 113.57 353.38 8.27 ------__------Total PROJECT COSTS 105.12 292.85 366.16 376.47 390.73 412.79 1944.12 70.65 Taxes 14.29 35.39 38.54 38.65 39.57 41.87 208.30 7.59 Foreign Exchange 26.94 74.35 88.53 90.53 93.83 99.32 473.49 17.22 ------_------__------__------

PAKISTAN Table 2 Fordwah Eastern Sadiqia(South) Irrigation & Drainage Project Rupees (Million)

Summary Accounts by Year

Base Costs -- _------_------__--- 1993 1994 1995 1996 1997 1998 Total

I. INVESTMT COSTS ______A. Civil Works 54.10 182.57 237.54 235.68 216.42 216.42 1142.73 B. Consulting Services 13.56 20.33 20.84 19.64 31.44 31.44 137.23 C. Administration & Opn. Exp 16.04 32.44 33.26 30.14 32.74 31.74 176.36 D. Equipment 5.56 8.16 1.40 0.00 0.00 0.00 15.13 E. Vehicles 6.38 8.15 1.77 0.00 0.00 0.00 16.30 ______Total BASELINE COSTS 95.65 251.65 294.80 285.45 280.56 279.59 1487.74 Physical Contingenctes 4.91 16.35 21.32 21.17 19.63 19.63 103.00 Prico Contingencies 4.57 24.85 50.04 69.85 90.50 113.57 353.38 -- _------_------__------Total PROJECT COSTS 105.12 292.85 366.16 376.47 390.73 412.79 1944.12

Taxes 14.29 35.39 38.54 38.65 39.57 41.87 208.30 Foreign Exchange 26.94 74.35 88.53 90.53 93.83 99.32 473.49 ------_------_------__------__------PAKISTAN Annex 6 Fordwah Eastern Sadiqla(South) Table 3 Irrigation & Drainage Project SummaryAccount by Project Component Rupees (Million)

On Farm Moltori IrrigatiMonitorl Tecbnica Future Intercep Water us & on nu & 1 Proj. tor Canal Manageme Surface Phase2 DrainageEvaluati Assist. Preparat Drains Lining nt Drains Prep Ren. on & Trng. ion 1. INVESTMENTCOSTS ______A. CiviL Works 496.29 420.14 0.00 158.80 60.50 7.00 0.00 0.00 0.00 B. Consulting Services 37.16 26.50 2.70 11.87 3.80 20.00 0.00 11.20 24.00 C. Adnniastratimn & Opo. Exp 17.27 19.54 15.05 5.00 14.40 86.99 7.80 8.80 1.50 D. Equiprent 3.89 2.10 1.22 1.67 3.09 3.15 0.00 0.00 0.00 E. Vehicles 5.88 3.88 1.42 2.52 1.00 1.60 0.00 0.00 0.00

Total BASELIRECOSTS 560.49 472.16 20.40 179.86 82.79 118.74 7.80 20.00 25.50 0% PhysicalContingencies 39.70 42.01 0.00 15.88 4.84 0.56 0.00 0.00 0.00 0 PriceContingencies 135.15 116.29 1.97 44.01 14.78 26.15 2.11 4.29 8.63 1 ------_------__-----__------TotalPROJECT COSTS 735.34 630.47 22.37 239.75 102.40 145.45 9.91 24.29 34.13

Taxes 89.32 75.02 1.65 18.83 11.50 5.85 J.00 2.17 3.96 Foraign Exchange 205.50 156.46 2.77 39.48 29.49 17.94 0.00 7.19 14.67 ------_------__------__------61 -

PAKISTAN Anex 6 Pordwah Eastern Sadiqi&(South) Table 4 Irrigation & Drainage Project Projects Components by Year

Totals Inoluding Contingencies Rupees (Million)

------__-- 1993 1994 1995 199S 1997 1998 Total

A. InterceptorDrains 40.08 102.83 136.30 143.28 151.87 160.99 735.34 8. Canal Lining 32.81 87.03 117.27 123.56 130.97 138.83 630.47 C. On Farm Water Management 7.29 7.91 7.16 0.00 0.00 0.00 22.37 D. SurfaceDrains 13.39 33.42 44.48 46.63 49.43 52.40 239.75 E. Monitoring & Phase 2 Prep 2.65 29.80 30.83 29.47 4.69 4.97 102.40 F. Irrigation Drainage Res. (Total) 8.05 26.40 24.68 25.43 29.56 31.33 145.45 Impact of Waterlosging and salinity 1.99 9.72 10.19 10.80 11.45 12.14 56.30 Improved Technology for Planning and Monitoring 1.78 4.70 4.05 4.30 5.85 6.21 26.89 Peformance of Canal Lining 1.78 4.70 4.05 4.30 5.85 6.21 26.89 Integrated IrrigatedAgriculture Management 2.41 5.64 5.92 5.54 5.87 6.22 31.60 Agriculture Extension 0.10 1.64 0.46 0.49 0.52 0.55 3.76

G. Monitoring & Evaluation 0.00 0.55 1.16 2.58 2.73 2.90 9.91 H. Technical Assist. & Trns. 0.84 4.92 4.29 4.91 5.21 4.14 24.29 I. Future Proj. Preparation 0.00 0.00 0.00 0.61 16.27 17.24 34.13

Total PROJECTS COSTS 105.12 292.85 366.16 376.47 390.73 412.79 1944.12

Table 5 PAKISTAN Forduah Eastern Sadiqia(South) Irrigation& Drainage Project ProjectsComponents by Year

Totals IncludingContingencies US$ (million)

1993 1994 1995 1996 1997 1998 Total

A. InterceptorDrains 1.54 3.89 5.05 5.20 5.40 5.61 26.70 B. Canal Lining 1.28 3.29 4.35 4.49 4.66 4.84 22.89 C. On Farm Water Management 0.28 0.30 0.27 0.00 0.00 0.00 0.85 D. Surface Drains 0.52 1.28 1.65 1.69 1.76 1.82 8.71 E. Monitoring & Phase 2 Prep 0.10 1.13 1.14 1.07 0.17 0.17 3.78 F. Irrigation Drainage Res. 0.30 1.00 0.92 0.93 1.05 1.09 5.29 G. Monitoring 6 Evaluation 0.00 0.02 0.04 0.09 0.10 0.10 0.36 S. TechnicalAssist. & Trng. 0.03 0.19 0.16 0.18 0.19 0.14 0.88 I. FutureProj. Prep ration 0.00 0.00 0.00 0.02 0.58 0.60 1.20

Total PROJECTS COSTS 4.04 11.08 13.58 13.67 13.90 14.38 70.65 - 62 -

PAKISTAN Annex 7 Table 1 FORDWAHEASTERN SADIOIA (SOUTH)

IRRIGATION AND DRATNAGEPROJECT

Estimated Disbursement Schedule

(US$ Million)

Semester Per Semester Cumulative

First Second 1.53 1.53 mY94 FLrst 1.53 3.06 Second 4.20 7.26

Flrst 4.20 11.46 Second 5.21 16.67

FM First 5.21 21.88 Second 5.25 27.13

First 5.25 32.38 Second 5.36 37.74

FLrst 5.36 43.10 Second 5.55 48.65

5m First 5.55 54.20 - 63 -

PAKISTAN Annex 7 FORDWAH EASTERN SADIOIA (SOUTH) Table 2 IRRIGATION AND DRAINAGE PROJECT

Disbursements

Amount Percent of Expenditure Category (USS Million) to be Financed

1. Civil Works 75% of expenditure

InterceptorDrains WAPDA 13.98 Surface Drains 5.20 Monitoring and Phase 2 1.87 preparation - 21.05

Canal lining PID 10.78 Irrigation & Drainage PAD 0.21 research Sub-total 32.04

2. Consulting Services 80% of expenditure WAPDA 3.41 PID 0.82 PAD 0.08 Sub-total 4.31

3. Incremental Staff Salaries, 90% of expenditure. Operating Expenditure 100% of expenditure for and Training training

WAPDA 4.39 PID 0.69 PAD 1.10 Sub-total 6.18

4. EquiRment and Vehicles 100% of foreign expenditures,100% WAPDA 0.41 of local expenditures PID 0.13 (ex-factorycosts) and PAD 0.17 60% of local expenditure Sub-total 0.71 for other items procured locally 6. Unallocated WAPDA 5.89 PID 4.89 PAD 0.18 Sub-total 10.96

Total 4.20 - 64 -

PAKISTAN Annex 8

FORDWAHEASTERN SADIOIA (SOUTH) PHASE 1

IRRIGATION AND DRAINAGE PROJECT

Project Imolemetation Schedule

PROJECT YEARS (PY)%

Project Component PYI PY2 PY3 PY4 PY5 PY6 Total

5 15 20 20 20 100 Intercfptor Drains

5 15 20 20 20 20 100 Canal Lining

30 35 35 100 On Farm Water Management

5 15 20 20 20 20 100 Surface Drains

5 30 30 15 10 10 100 Phase 2 Preparation and Monitoring 5 15 20 20 20 20 100 Irrigation & Drainage - Research 5 10 20 20 20 25 100 Monitoring and Evaluation

5 25 20 20 20 10 100 Technical Assistance and Training _ 10 45 45 100 Future Project Preparation

Procurement: 40 50 10 100 Equipment and Vehicles - 65 -

Annex 9 Table 1 PAKISTAN

FORDWAH EASTERN SADIOIA (SOUTH) IRRIGATIONAND DRAINAGE PROJECT

Surface Water Availability ('000 Acre Feet)

At the Root Zone Canal Without/a With Head Present Project Project Incremental

January 39.8 14.6 17.8 20.8 3.0 February 87.8 32.1 37.8 44.9 7.1 March 103.8 38.0 44.7 52.8 8.1 April 100.5 36.8 43.3 51.1 7.8 May 108.3 39.6 46.6 55.0 8.4 June 106.9 39.1 46.0 54.4 8.4 July 108.3 39.6 46.6 55.0 8.4 August 103.8 38.0 44.7 52.8 8.1 September 98.3 36.7 43.2 51.0 7.8 October 95.0 34.8 40.9 48.3 7.4 November 109.0 40.5 46.? 55.4 8.5 December 103.8 38.0 44.7 52.8 8.1

Rabi 539.3 198.0 232.8 275.0 42.2 Kharif 626.1 229.8 270.4 319.3 48.9 Annual 1165.4 427.8 503.2 594.3 91.1

/a With On Farm Water Management (OFWM). - 66 -

Annex 9 PAKISTAN Table-2

FCRDWABEASTERN SADIOZA (SOUTH) IRRIGATION ANDDRAINAGE PROJECT

Financial Budgot - Total Project (Million Rupees)

Paddy Rabi Mustard Kharif Sugar- tal IRRI) Cotton FodderF Rave Foder cons Whatk

Present Production Main Outputs 752.3 15.2 226.1 63.8 24.8 68.4 130.7 223.3 By-Produots 38.2 2.0 4.4 - 0.3 - 3.0 28.5 Total 790.6 17.2 230.5 63.8 25.1 68.4 133.7 251.8

ProductionCost Seed (54.7) (0.2) (4.1) (4.9) (0.3) (1.5) .28.1) (15.6) Fertilizer (97.1) (3.1) (27.4) (3.4) (1.0) (3.1) (12.1) (47.0) Water Charges (8.5) (0.4) (2.6) (0.3) (0.2) (0.4) (1.6) (2.8) Pesticides (73.4) (0.3) (69.8) (0.6) (2.7) Hired Labor (73.9) (4.3) (25.7) (1.0) (0.3) (0.6) (14.6) (27.4) Tractor (167.1) (5.3) (41.5) (7.6) (1.0) (7.0) (19.0) (85.6) Bullockc (15.2) (1.5) (2.8) (0.9) (0.4) (1.1) (1.4) (7.1) Total (489.9) (15.1) (174.0) (18.2) (3.2) (13.7) (77.5) (188.2)

Net Production Value 300.7 2.1 56.5 45.6 21.9 54.7 56.3 63.6

Without Proict (with OFWM) Production Main Outputs 855.8 15.6 278.2 65.8 25.6 70.5 134.7 265.3 By-Products 44.8 2.1 5.4 0.3 3.1 33.8 Total 900.6 17.7 283.6 85.8 25.9 70.5 137.8 299.2

ProductionCost Seed (56.4) (0.2) (4.2) (5.1) (0.3) (1.5) (29.0) (16.1) Fertilizer (100.1) (3.2) (28.2) (3.5) (1.1) (3.2) (12.5) (48.4) Water Charges (8.7) (0.4) (2.7) (0.4) (0.2) (0.4) (1.7) (2.9) Pesticides (75.5) (0.3) (71.8) (0.6) (2.8) Hired Labor (76.0) (4.4) (26.5) (1.0) (0.3) (0.6) (15.1) (28.2) Tractor (172.2) (5.5) (42.8) (7.9) (1.1) (7.2) (19.6) (88.2) Bullocks (15.7) (1.6) (2.9) (1.0) (0.4) (1.1) (1.4) (7.3) Total (504.6) (15.6) (179.1) (18.8) (3.3) (14.1) (79.9) (193.8)

Not Production Value 396.0 2.2 104.4 47.0 22.6 55.4 58.0 105.3 Witb Pro10ct Production Main Outputs 1.109.1 18.7 382.0 79.7 34.5 83.9 182.0 328.3 By-Products 56.4 2.5 7.4 0.5 4.2 41.9 Total 1.165.6 21.2 389.4 79.7 35.0 83.9 186.2 370.2

ProductionCost Seed (67.2) (0.3) (5.0) (6.1) (0.3) (1.8) (34.5) (19.2) Fertilizer (119.5) (3.8) (33.7) (4.2) (1.3) (3.8) (14.9) (57.8) Wetor Charge& (10.4) (0.5) (3.2) (0.4) (0.3) (0.5) (2.0) (3.5) P4sticides (90.4) (0.3) (86.0) (0.7) (3.4) Hired Labor (91.2) (5.2) (31.8) (1.3) (0.3) (0.8) (18.1) (33.8) Tractor (205.4) (6.8) (51.1) (9.3) (1.3) (8.5) (23.4) (105.2) Bullocks (;8.7) (1.9) (3.5) (1.1) (0.5) (1.3) (1.7) (8.7) Total (602.8) (18.6) (214.2) (22.4) (4.0) (16.6) (95.2) (231.6)

Not ProductionValue 562.8 2.5 175.2 57.3 31.0 67.1 91.0 138.6 IncrementalValue of Production 165.8 0.4 70.8 10.3 8.4 10.7 33.1 33.3 - 67 -

Annex 9 PAX18T^ Tabloe3

FORDWABEASTERN SADIOIA (SOUTH) IRRIGATIONAND DRAINAGE PROJEC?

Financial Budget (MillionRupees)

Small Farms (3.5 ha) 1,

Paddy Rabi Mustard Iharif Su_er- Total tIRRI) Cotton Fodder & Race Fodder cene Wheat

Preesnt

Value of Production 308.9 6.6 84.7 31.2 11.7 33.5 54.8 86.5 ProductionCost (179.8) (4.8) (57.9) (7.9) (1.4) (6.2) (32.6) (69.0) Not ProduotionValue 129.2 1.8 26.8 23.3 10.3 27.3 22.2 17.5

Without Pro5eet (with OPWM)

Value of Production 360.5 6.8 105.2 32.4 12.1 34.8 56.9 112.4 ProductionCost (166.6) (4.9) (60.1) (8.2) (1.4) (6.4) (33.9) (71.6) Net ProductionVolue 173.9 1.9 45.0 24.2 10.7 28.3 23.0 40.8

With Pro.1ect

Value of Production 459.5 7.9 143.8 38.5 16.1 40.6 75.3 137.278 ProductionCost (217.9) (5.8) (70.2) (9.6) (1.7) (7.5) (39.U) (83.6) Net ProductionValue 241.5 2.2 73.8 28.9 14.4 33.1 35.7 53.7

IncrementalValuo of Production 67.6 0.3 28.6 4.7 3.7 4.8 12.7 12.9

Large Farms (11 ha) y

Present

Value of Production 481.6 10.7 145.8 32.6 13.5 34.9 78.9 155.3 ProductionCost (310.1) (10.4) (116.0) (10.3) (1.9) (7.5) (44.8) (119.2) Net ProductionValue 171.5 0.3 29.7 22.3 11.6 27.4 34.1 46.1

Without Project (withOFWM)

Value of Production 540.1 10.9 178.4 33.5 13.8 35.8 80.9 186.8 ProductionCost (318.0) (10.6) (119.0) (10.6) (1.9) (7.7) (46.0) (122.3) Net ProductionValue 222.1 0.3 59.4 22.9 11.9 28.1 34.9 84.5

With Progect

Value of Production 706.1 13.2 245.8 41.2 13.9 43.3 110.9 232.9 ProductionCost (384.9) (12.9) (144.0) (12.8) (2.3) (9.3) (55.6) (148.0) Net ProductionValue 321.2 0.4 101.6 28.4 16.6 34.0 55.3 84.9

IncrementalValue of Production 99.1 0.1 42.2 5.5 4.7 5.9 20.4 20.4

f 12.274. V 5,620. - 68 -

Annex 9 PAKISTAN Table 4

FORDWAHEASTERN SADIOIA (SOUTH) IRRIGATION AND DRAINAGE PROJECT

Prices Used in Financial and Economic Analysis (in Rupees)

Financial Prices Economic Prices Unit (const 1991-92) 1991-92 1998-99 2006-11 Outp-uts 'Theat kg 2.80 4.73 6.09 5.52 Paddy (IRRI) kg 2.00 3.09 2.83 2.54 Seed cotton kg 7.13 11.82 12.47 12.15 K. Fodder (sorghum,maize) kg 0.30 0.27 0.27 0.27 R. Fodder (berseem) kg 0.23 0.21 0.21 0.21 Sugarcane kg 0.42 0.33 0.56 0.60 Oilseeds (mustard) kg 6.80 6.12 6.12 6.12

Inputs Seed 1/ Wheat kg 3.30 5.57 7.18 6.51 Paddy (IRRI) kg 2.50 3.86 3.54 3.18 Cotton kg 7.25 12.02 12.68 12.35 K. Fodder (sorghum,maize) kg 2.55 2.30 2.30 2.30 R. rodder (berseem) kg 24.00 21.60 21.60 21.60 Oilseeds (mustard) kg 6.08 5.47 5.47 5.47 Sugarcane cuttings kg 0.42 0.33 0.56 0.60 Nitrogen fertilizer kg 2/ 8.87 12.89 13.12 12.25 Phosphatic fertilizer kg 2/ 10.83 9.39 10.65 10.48 Pesticides Cotton Appl/ha 617.30 555.60 555.60 555.60 Paddy (IRRI) / 86.00 77.40 77.40 77.40 Wheat o/f 86.00 77.40 77.40 77.40 Sugarcane " 37.00 33.30 33.30 33.30 Bullcck Pairday 45.00 40.50 40.50 40.50 Tractor Hour 74.00 66.60 66.60 66.60

Labor Workday 35.00 31.50 31.50 31.50

1/ Usually demands a premium over ouiput price. 2/ Of nutrient. ]/ Large farm only. PAKISTAN Annex 10 Table 1 FCBDWAEEASTERN SADIOIA (SOUTH) PROJECT. PHASE 1 IRRIGATIOR AND DRAINAGEPROJECT

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006-18

A.1 Cropping and surface water supply pattern same as without project. Excluding Research, Monitoring & Phase 2 Preparation and Future Project Preparation Incremental Benefits 3.22 16.33 42.89 87.00 143.58 207.37 260.19 300.39 318.02 312.52 307.28 302.12 297.22 294.81 Investmeut Costs 76.06 182.88 231.46 224.41 221.95 218.65 O&M Cosq ------18 18 18 18 18 18 18 18 8en-cost -72.83 -166.54 -188.56 -137.41 -78.37 -11.28 242.19 282.4 300.02 294.52 289.28 284.12 279.22 276.81

InternalRate of Return - 22.22S

A.2 Cropping and surfacewater supply pattern same as without project. Including Research. Monitoring & Phase 2 Preparationand Future Project Preparation Incremental Benefits 3.22 16.33 42.89 87.00 143.58 207.37 260.19 300.39 318.02 312.52 307.28 302.12 297.22 294.81 Investment Cost 86.27 232.61 277.58 267.97 260.65 257.35 O&M Cost ------18 18 18 18 18 18 18 18 Net Benefits -83.05 -216.27 -234.68 -180.97 -117.07 -49.98 242.19 282.4 300.02 294.52 289.28 284.12 279.22 276.81

Internal rate of Return - 18.49X

8.1 Shift in cropping pattern by 52 and reallocation of 52 of surface water within each season. Excluding Research, Monitoring & Phase 2 Preparationand Future Project Preparation Incremental Benefits 4.99 25.19 66.09 134.09 220.73 317.97 397.94 458.20 485.u2 477.86 470.94 464.07 457.67 454.49 Invdstment Costs 76.06 182.88 231.46 224.41 221.95 218.65 owCost ------18 18 18 18 18 18 18 18 net Benefits -71.07 -157.69 -165.37 -90.31 -1.22 99.32 379.94 440.19 467.02 459.86 452.94 446.07 439.67 436.49

Internal rate of Return - 33.842

B.2 Shift in cropping pattern by 52 and reallocation of 52 of surface water within each season. Including Research. Monitoring & Phase 2 Preparation and Future Project Preparation

Inerumental Benefits 4.99 25.19 66.09 134.09 220.73 317.97 397.94 458.20 485.02 477.86 470.94 464.07 457.67 454.49 InvestmentCost 86.27 232.61 277.58 267.97 260.65 257.35 O0MCost ------18 18 18 18 18 18 18 18 Not benefits -81.28 -207.42 -211.49 -133.87 -39.92 60.62 379.94 440.20 467.02 459.86 452.94 446.07 439.67 436.49

Internal rate of Return - 28.49S - 70 -

PAKISTAN Annex 11 Page 1 FORDWAH EASTER SADIQIA (SOUTH) IRRIGATIONAND DRAINAGE PROJECT

IDA SUPERVISIONPLAN

Approximate Activity Expected Skill Staff Input Dates Requirements (Staff Weeks) (Month/Year)

11/92 Project Launch Mission IrrigationEngineer 8 (discuss and review all Drainage Engineer programs under project Procurement and ensure implementing Spec'alist agencies know their responsibility)

1/93 Supervisionmission IrrigationEngineer 12 (review of detailed Drainage Engineer designs, construction Agriculturalist plans, construction Canal lining and supervision Drainage specialists arrangements,research design and implementation arrangements)

9/93 Supervisionmission IrrigationEngineer 6 (normal supervisionand InstitutionSpecialist review of conceptual design for the "demand based" irrigationand related pilot programs)

3/94 Supervisionmission As needed 6 9/94 Supervisionmission As needed 6

3/95 Mid-term Review As needed 12

Onwards Two Supervision As needed 24 missions per year

3/98 Final Review, Project As needed 6 Evaluation and initiationof PCR process

Total 80 Chart 1 PAKISTAN- FORDWAHEASTERN SADIOIA (SOUTH) PHASE I IRRIGATION& DRAINAGEPROJECT Project OrganizatUon& Coordination among existing Agencies

[ POLICYCOMMITTEE j

| PROJECTCOORDINATION MONITORINGAND COMMITTEE EVALUATION SMO.EnvlronmenlalUnit '4 ______…_ P & I/WMED

9 i i S vS DIRECTORATE GENERAL DIRECTORATEGENERAL DIRECTORATEOF IRRIGATION OF AGRICULTUREEXTN. OF OFWM W COMMANDWATER MGMT. DEPARTMENT WAPDA Deputy Director ~~~~~~TeamLeader ChiefEngineer PD (Drainage) * DeputyDirector * AreaCoordinator SocialOrganizers J2) (Bawalnagar) Coordination IWASRI Fi*eldTeams (4) Agronomists(2) PD (Canal Lining) *EADAs(3) *Agronomy Teams(4) P&I Engineers/Hydrologists(4) ExecutiveEngineers (2) PD Planning(water) SubdivislonalOffcers SDO (3)______

- Developmentof WaterCourse !-.xtensionmessags IpoentIntegrated Reseachon CanalLining InterceptorDrai Inrigated SuaalLnig-IntecepoDrains AgricultureMgmt. - Collaboratngwith Phase2 preparaUon audio - Demonstratoncenters visualvArrangingsosat FarmerOrganization CWMon research Irrigatonand Drainage FamrOgaao for demandbased demonstrationcenters . WaterManagement Research Seedrm system Mondodng Advic/ExteslonProgram -Future Project preparation

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