Download Extension of Closing Date

Document of
The World Bank
Report No: 60065-IN
RESTRUCTURING PAPER
ON A
PROPOSED PROJECT RESTRUCTURING
OF
MADHYA PRADESH WATER SECTOR RESTRUCTURING PROJECT
LOAN NO 4750-IN
SEPTEMBER 7, 2004
TO THE
REPUBLIC OF INDIA
MARCH 30, 2011
Extension of Closing Date
INDIA — MADHYA PRADESH WATER SECTOR RESTRUCTURING PROJECT
P073370
LOAN L4750-IN
Restructuring Paper
1.
The closing date for India, Madhya Pradesh Water Sector Restructuring Project
(MPWSRP), Loan No L4750-IN, P073370 will be extended from March 31, 2011 until
December 31, 2011.
2.
MPWSRP is some three years behind schedule with only about 45 percent of
available loan funds disbursed. None of the project components has advanced
sufficiently to be fully completed by the original closing date, stemming from an overly
complex project design. The project has been in problem status for over 12 months and
needs major restructuring. The main project design and implementation challenges
include (not in order of importance): delayed recruitment of consulting firms and quality
of performance of several firms; cumbersome Scheme Modernization Plan preparation
and approval procedures; varying contractors’ performance; poor integration of the line
agencies; water and irrigation sector reform without clear focus and not well understood;
and ineffective water users association (WUA) development resulting in a few viable
WUAs so far.
3.
Agriculture accounts for over 30 percent of the Gross Domestic Product of
Madhya Pradesh and it accounts for around 70 percent of employment. Irrigation is an
essential input for guaranteed agricultural production. As improvement and reform of the
irrigation sector is important, the Government of Madhya Pradesh (GoMP) is interested
to continue the implementation of a restructured and simplified MPWSRP.
4.
The proposed closing date extension with nine months gives sufficient time for
the Government of India and GoMP to work towards a clear demonstration of
significantly improved project implementation in the coming months. It will also give a
period for further support from the task team to review all possible options for the Bank
to continue assisting with the reform of the irrigation sector in Madhya Pradesh. The
attached table summarizes the main constraints that were identified by a recent Bank
implementation review mission and the proposed actions, which will however require
further discussions with management of GoMP before they can be finalized in a preferred
option.
5.
This will be the first extension of the project.
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Summary of main project implementation constraints
and
proposed actions under a restructured or new project
Constraints
Component A - Water
Resources Management.
 Slow water sector reform that
is not well understood.
Proposed Actions
 Three agencies related to regulation
were proposed: State Water Resources
Agency (SWaRA), the associated State
Water Resources Data and Analysis
Center (SWaRDAC), and a State Water
Tariff Regulatory Commission
(SWaTReC). These proposed
regulatory offices can probably (to be
studied in more detail) be merged into
one with an overall mandate for
integrated water resources
management;
Remarks
The restructured
project will
support
government with
the
implementation of
the proposed
actions during the
extended three
year project
duration.
 Preparation of river basin plans can be
done after the setting up of effective
river basin councils (or boards) that
comprise all stakeholders in a basin;
 Tariff setting should be limited to
license fees for bulk water abstractions,
but the regulatory authority should not
be involved in the setting of service
fees, which is to be done by the
specific service provider.
Component B – Service
Delivery.
 Reform of the WRD slow and
not well focused.
 WUA development has been
poorly executed with lack of
focus and lack of community
engagement, resulting in lack
of awareness and sense of
ownership. Currently there
are very few developed
WUAs, yet they are seen as
very important by senior
management in the state.
 Develop and start the implementation
of a reform program of the Water
Resources Department that will change
the main focus from being a
construction agency to an irrigation
water management agency. This will
require major restructuring of the
department at state, river basin, and
divisional level, as well as change in
staffing over time.
 Twin approach proposed for WUA
development, with (i) development of
capacity within government to support,
train, guide, and monitor WUAs; and
(ii) provide support to WUAs in the
project schemes during the next three
years;
 Transform the Participatory Irrigation
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The restructured
project will
support
government with
the
implementation of
the proposed
actions during the
extended three
year project
duration.
Management (PIM) Directorate and the
Command Area Development Agency
(CADA) in WRD into an agency that
can provide visionary leadership for
long-term WUA development in the
state and carry out overall monitoring
of WUAs;
 Set up WUA Support Units at WRD
Divisional level to provide the needed
support and training to WUAs;
 Have each WUA develop a Charter that
spells out the rights and responsibilities
of a WUA and its membership;
 Move towards irrigation management
transfer (IMT) in smaller schemes
which would give well developed
WUAs full management control over
the schemes;
 Allow WUAs to set the service fees and
have them retain the portion of the fees
that is needed for own management.
operation, and maintenance;
 The above will take time, therefore in
the meantime recruit an organization
with experience in WUA development
and training for each of the five river
basins under the project. They should
have clear and focused terms of
reference with targets for training and
support.
Component C – Improving
Productivity of Selected
Existing I&D Assets.
 Slow and uncoordinated
preparation and
implementation of SMPs,
partly caused by too much
reliance on consultants and
poor integration of line
agencies. WUAs not fully
aware of the proposals in the
SMPs.
 Have divisional staff of the Water
The restructured
Resources Department, rather than
project will
private consultants, prepare short SMPs support
with a focused content.
government with
the
 Prepare proposals for agriculture,
implementation of
horticulture, and fisheries on a district
the proposed
or river basin level as the cropping
actions during the
patterns are very similar across
extended three
schemes, and have the district line
year project
agency staff chose from a menu of
duration.
options for demonstrations and
advisory services in each scheme.
Demonstrations by line agencies should
all have a focus on efficient water
management (e.g. zero tillage and
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SRI);
 The results of SMPs have to be
properly disseminated to staff in
district offices, which can be done with
the help of the Collectors who hold
regular coordination meetings for the
agricultural sector;
 Incorporate the proposals in the SMP
into the annual work plans of relevant
departments;
 WUAs have to know about the SMPs
and should sign a MoU with WRD that
spells out the agreement to implement
the SMPs and the requirement for
WUAs to carry out operation and
maintenance afterwards;
 Coordination committee under the
chairmanship of the Agriculture
Production Commissioner at state level
to meet on a regular basis to review the
implementation of SMPs.
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