ASIAN DEVELOPMENT BANK

PPA:INO 17164

PROJECT PERFORMANCE AUDIT REPORT

ON THE

INTEGRATED IRRIGATION SECTOR PROJECT (Loans 1017-INO/1018-INO[SF])

IN

INDONESIA

December 2001

CURRENCY EQUIVALENTS Currency Unit Indonesian Rupiah (Rp) At Appraisal (August 1989) $0.00055096 Rp1,815 At Project Completion (April 1999) $0.00012121 Rp8,250 ABBREVIATIONS ADB BAPPEDA DGFCH DGRD DGRLR DGWRD DI EIRR EOM ha IOMP ISF M&E O&M OEM PBB PCR PPAR PRAS PRIS PTGA PWRS R&U Repelita SJFC TA TDU VO WATSAL WID WOC WUA Asian Development Bank Badan Perencanaan Pembangunan Daerah (Regional Development Planning Agency) Directorate General of Food Crops and Horticulture Directorate General of Regional Development Directorate General of Reforestation and Land Rehabilitation Directorate General of Water Resources Development Daerah Istimewa (special region) economic internal rate of return efficient operation and maintenance hectare irrigation operation and maintenance irrigation service fee monitoring and evaluation operation and maintenance Operations Evaluation Mission pajak bumi dan bangunan (land and building tax) project completion report project performance audit report provincial agricultural service provincial irrigation service Indonesian On-Farm Water Management Project provincial water resources service rehabilitation and upgrading Five-Year Development Plan South Java Flood Control technical assistance tertiary development unit variation order Water Sector Adjustment Loan women in development Water Operations Center water users association NOTES (i) (ii) The fiscal year (FY) of the Government ends on 31 March. In this report, $ refers to US dollars. Operations Evaluation Department, PE-586 At Operations Evaluation (May 2001) $0.0000907 Rp11,025

Rp1.00 $1.00

= =

CONTENTS

Page
BASIC DATA EXECUTIVE SUMMARY MAP I. BACKGROUND A. B. C. D. E. F. II. Rationale Formulation Purpose and Outputs Cost, Financing, and Executing Arrangements Completion and Self-Evaluation Operations Evaluation ii iv vii 1 1 1 1 3 3 4 4 4 5 5 6 6 7 7 10 11 11 12 12 13 13 14 14 14 15 15 16 16 16 16 16 18 22 23

PLANNING AND IMPLEMENTATION PERFORMANCE A. B. C. D. E. Formulation and Design Achievement of Outputs Cost and Scheduling Procurement and Construction Organization and Management

III.

ACHIEVEMENT OF PROJECT PURPOSE A. B. C. D. Operational Performance Performance of the Operating Entity Economic Reevaluation Sustainability

IV.

ACHIEVEMENT OF OTHER DEVELOPMENT IMPACTS A. B. C. Socioeconomic Impact Environmental Impact Impact on Institutions and Policy

V.

OVERALL ASSESSMENT A. B. C. D. E. F. G. Relevance Efficacy Efficiency Sustainability Institutional Development and Other Impacts Overall Project Rating Assessment of ADB and Borrower Performance

VI.

ISSUES, LESSONS, AND FOLLOW-UP ACTIONS A. B. C. Key Issues for the Future Lessons Identified Follow-Up Actions

APPENDIXES

vii BASIC DATA Integrated Irrigation Sector Project (Loans 1017/1018-INO[SF]) PROJECT PREPARATION
Technical Assistance TA 857
a

Title

Type

Telang and Saleh Drainage Improvement Project

PPTA

No. of Personmonths 43

Amount ($ million) 0.65

Approval Date 23 Feb 1987

Loans Loan 479 Loan 518 Loan 522 Loan 638 Loan 725 Loans 860(SF)/861

Lower Citanduy Irrigation Project Wadaslintang Multipurpose Project Bali Irrigation Sector Second Irrigation Sector Technical Assistance Program Loan Third Irrigation Sector Project

55.20 87.70 33.60 85.00 25.00 120.00

13 Nov 1980 23 Jun 1981 17 Sep 1983 22 Sep 1983 18 Dec 1984 17 Nov 1987

KEY PROJECT DATA ($ million)

Total Project Cost Foreign Exchange Cost Local Currency Cost ADB Loan Amount/Utilization ADB Loan Amount/Cancellation

Per ADB Documents

264.0 103.0 161.0 200.0

Actual
250.1 110.6 139.5 198.0 5.2

KEY DATES
Appraisal Loan Negotiations Board Approval Loan Agreement Loan Effectiveness Initial Disbursement Project Completion Loan Closing Months (effectiveness to completion)

Expected

Actual
1-18 Aug 1989 13-15 Nov 1989 17 Apr 1990 27 Jun 1990 10 Aug 1990 22 Apr 1991 31 Mar 1997 29 Jan 1999 79

25 Sep 1990 31 Mar 1995 30 Sep 1995 54

ECONOMIC AND FINANCIAL INTERNAL RATE OF RETURN (%)

Economic Internal Rate of Return Financial Internal Rate of Return

Appraisal
15.9

PCR
13.4

PPAR
8.3

BORROWER EXECUTING AGENCIES

Part A: Part B: Parts C & E: Part D: Part F:

Government of Indonesia

Directorate General of Water Resources Development Directorate General of Public Administration and Regional Autonomy Directorate General of Food Crops and Horticulture Directorate General of Reforestation and Land Rehabilitation Directorate General of Regional Development

= not calculated, ADB = Asian Development Bank, PCR = project completion report, PPAR = project performance audit report, PPTA = project preparatory technical assistance. a The number of person-months spent for preparatory work for the Project under various loans cannot be determined.

iii

MISSION DATA Type of Mission Appraisalb Inception Project Administration Review Midterm Review Project Completion Operations Evaluationc

No. of Missions 1 1 14 1 1 1

No. of Person-Days 126 10 313 40 84 42

No formal loan fact-finding mission was undertaken. Preparatory work was carried out under various ADBsupported loans and TAs prior to appraisal. The Operations Evaluation Mission comprised C.B. Amerling, Senior Evaluation Specialist (Mission Leader); and C. Morris, Consultant.

vii EXECUTIVE SUMMARY The Project was designed to support the Governments development goals in the agriculture sector, which included consolidating rice productivity gains, broadening the agriculture base, creating rural employment opportunities, and achieving balanced regional development. The Project was specifically aimed to accelerate agricultural development in the major rice producing provinces of Central Java, Daerah Istimewa (DI) Yogyakarta, Southeast Sulawesi, South Sumatra, and West Sumatra. The Project consisted of six components: (i) irrigation development, including rehabilitation and upgrading of irrigation and drainage schemes; introduction of efficient operation and maintenance (O&M); transfer of O&M responsibilities from central to provincial agencies and water users associations (WUAs); and institutional strengthening; (ii) introduction of an irrigation service fee (ISF); (iii) agricultural development through tertiary development units (TDUs) for testing water management techniques, improvement of seed farms, land development, and strengthening of WUAs; (iv) soil and water conservation; (v) women in development; and (vi) strengthening of coordination and monitoring. Project relevance has changed considerably from the time of approval to evaluation. The objectives of increasing farm productivity, creating new employment opportunities, and improving the living standards of farmers remain highly relevant. However, the highly top-down centralized approach of project design and implementation, and lack of public consultation on policy reforms are now outdated. Major investments in isolated transmigration areas for transforming fragile swampland into irrigated rice areas have also been largely curtailed as they have generally been shown to be economically, ecologically, and technically unsound. In general, the Project achieved its physical targets and improved the welfare of poor families in its area of influence. The higher cropping intensities and rice yields generated resulted in substantial incremental output of rice, increased farmer incomes, and job creation, though at levels below the optimistic appraisal expectations. Physical completion of rehabilitation and upgrading, which dominated project expenditures, was significantly delayed, and in most cases, did not achieve full restoration of irrigation systems capacities or efficiencies. Project funding was inadequate to fully address all system needs, while funding supported works that, in some cases, may not have been technically or economically justified. The overall impact of the agricultural development component was marginal. Most TDU programs were carried out before irrigation systems were upgraded. This aggravated field operation problems and precluded most water management extension activities (often due to lack of water control structures and/or lack of water). Deterioration in most systems started soon after project completion due to less than adequate O&M funding and management. Progress on ISF has not been significant, and development of self-sustaining WUAs was largely not achieved. Sustainability of irrigation systems operations and project incremental outputs is assessed as less likely than anticipated. The unabated deterioration of project watersheds is expected to continue to accentuate flooding and drainage problems in the wet season, reduce water availability in the dry season, exacerbate the problems associated with increased sedimentation, and reduce water quality over time. Overall, the Project is rated only partly successful owing largely to (i) substantive shortfalls on O&M, WUA development, and cost recovery targets; (ii) significant shortfalls in improvements of women in development activities and executing agencies institutional capacity; (iii) accelerated deterioration of subprojects watersheds and resultant problems of sedimentation, drainage, and flooding in a number of subproject areas; (iv) insufficient attention to tertiary irrigation and drainage canal development; (v) negligible long-term impact of the TDU

v and seed production components; (vi) substantial noncompliance with major loan covenants for irrigation policy reforms; and (vii) questionable selection of some subprojects for investment. The evaluation has identified important issues for the future, among which are (i) sector approach to irrigation development and firm commitment to institutional development and capacity building; (ii) beneficiary and WUA participation, including delegation of responsibility for irrigation O&M to WUAs; and (iii) simplification of scope and involvement of fewer agencies. A stop-start approach to irrigation development reduces opportunities for institutional capacity building, leads to an inefficient deferred maintenance regime, and raises false hopes with water users and government agencies that development will continue in a well-planned long-term manner. A long-term commitment to irrigation sector development is required with major sectoral institutional changes addressed by using other loan modalities such as combining a sectoral investment and program modality within a long-term framework. In general, farmers, and collectively WUAs, were not involved in a participatory manner in project activities. Paternal, top-down attitudes of all executing agencies together with (i) inappropriate funding mechanisms, (ii) less than satisfactory institutional project design, and (iii) less than optimum use of consultants and nongovernment organizations all contributed to a lack of beneficiary participation. Tertiary designs and water management without WUA participation led to incomplete development of tertiary systems. The Project paid less attention to determining the readiness of WUAs to undertake O&M of tertiary systems. Difficulties in transferring O&M responsibilities were due to farmers inadequate knowledge of operational responsibilities, lack of skills for managing the schemes, insufficient involvement of WUAs, and inadequate extension services. Under the complex project design, resources of the Asian Development Bank and the Government, required to ensure efficient and effective implementation, were severely stretched. The Project, executed through six government agencies, was geographically diverse and included three unusual subprojects: (i) Batang Anai in West Sumatra with peat soils; (ii) Wawotobi in Southeast Sulawesi with high land development needs; and (iii) the core subproject Telang-Saleh in South Sumatra, a major swamp pilot project, accounting for about 25 percent of the total project area. These subprojects were not representative of the irrigation sector in Indonesia and had major technical differences from the Java irrigation subprojects. Limiting the Project to Java subprojects only, which were more homogeneous, contiguous in area, and similar in development requirements, would have significantly simplified implementation and allowed major works and activities (drains, flood prevention, tertiary development, and institutional support) to be finished. Among the lessons learned are the following: (i) Nationally managed provincial irrigation project activities need to be transferred to local provincial and district water resource services. The pressure to retain control at the center (national and provincial) rather than to delegate and decentralize continues to decrease institutional and project implementation efficiency. During project design, institutionalization of project activities needs to be given priority. The participation of beneficiaries is critical if they are to feel a sense of ownership and responsibility; this will also affect their attitudes to ISF and O&M. WUA establishment and strengthening should be accelerated with a focus on

(ii)

vi (a) quality organizations, (b) involvement in tertiary and main system O&M, and (c) a clear linkage between irrigation service and irrigation fees. (iii) Regular coordination meetings within the Regional Development Planning Agency (BAPPEDA) are important and should concentrate on the needs for interagency planning; identification of planning priorities; and assessment of proposals for scheme, subproject, and sector monitoring and evaluation, and institutional development coordination. To carry out such a program, the provincial water resources services need to strengthen their technical departments for irrigation planning and design, BAPPEDA needs to allocate regular funding (routine budgets) for funding such meetings, and beneficiaries need incentives and assistance to participate in bottom-up planning and implementation activities. Strengthening of administrative sections of provincial and district water resources services is required through the focused training of administrative staff and streamlining of procedures. The proposed introduction of efficient management information systems could also be very effective in more efficient utilization of staff time. More involvement of provincial and district authorities and beneficiaries in key policy directives is essential. Implementation of government O&M policy should be formulated, explained, and discussed jointly in a participatory manner with managers of the provincial and district water resources services, BAPPEDA officials (provincial and district levels), and other senior provincial government officials. A two-year commissioning period is generally required for adequate development programs for medium-sized schemes (1,0005,000 hectares) with a four-year period for large and major schemes (larger than 5,000 hectares). Programs should include training, improvements in infrastructure, development of information techniques for crop planting reporting, adjustments in water allocation systems, optimization of budgets, and purchase and commissioning of equipment. A human resources development program should be the basis of the training program. Training units need to be incorporated into the structural organization. All staff holding positions should be compelled to carry out a fixed number of training days each year as instructors. A training monitoring system and information system should be established to provide feedback for future courses Community organizers are required to ensure beneficiaries participate in government-led activities. However, a sustainable mechanism should be introduced, whereby project beneficiaries are not dependent on project community organizers. Farmers need to participate and be organized into WUAs (or other suitable institutions) at the earliest possible stage of system planning. Ensuring farmer involvement in tertiary system construction and main system design, prior to agreement on the modality of subproject development and O&M, is essential. For farmers to be available for participation in planning and design activities, field motivators must be active and in place in a timely manner, coinciding with the fielding of the survey, investigation, and design consultants.

(iv)

(v)

(vi)

(vii)

(viii)

vii

I. A. Rationale

BACKGROUND

1. In early 1989, the Government of Indonesia asked the Asian Development Bank (ADB) to finance part of its irrigation subsector investment program under the Rencana Pembangunan Lima Tahun (Repelita) V (1989/901993/94). The loan would support the rehabilitation and upgrading (R&U) of existing irrigation and drainage schemes, and the improvement of operation and maintenance (O&M) in the key rice-growing province of Central Java, and the provinces of Daerah Istimewa (DI) Yogyakarta, South Sumatra, Southeast Sulawesi, and West Sumatra. The Project1 was designed to support the Governments development goals in the agriculture sector at that time, which included consolidating rice productivity gains, broadening the agriculture base, creating rural employment opportunities, and achieving balanced regional development.2 Repelita V also placed increased emphasis on promoting diversified cropping systems and improving sector efficiency. B. Formulation

2. Appraised in August 1989, the Project was prepared without a project preparatory technical assistance (TA). However, all seven subprojects,3 including four core subprojects and three noncore subprojects, had existing preparatory studies, including feasibility studies and detailed designs, financed primarily by ADB under earlier loans and TAs, as well as by the World Bank and the governments of Italy and the Netherlands.4 Institutional issues of the Project were also well supported by earlier ADB loans and TAs.5 C. Purpose and Outputs

3. The Project aimed to accelerate agricultural development in the major rice-producing provinces to increase farm productivity, create employment opportunities, and improve the living standards of poor farmers. The Project was expected to have considerable impact on poverty
1 2

Loans 1017/1018(SF)-INO: Integrated Irrigation Sector Project, for $200 million, approved on 17 April 1990. The Project was preceded by three ADB-financed irrigation sector projects including Loan 522-INO: Bali Irrigation Sector Project, for $33.6 million, approved on 17 September 1983; Loan 638-INO: Second Irrigation Sector Project, for $85 million, approved on 22 September 1983; and Loans 860(SF)/861-INO: Third Irrigation Sector Project, for $120 million, approved on 17 November 1987. Core subprojects, evaluated and approved in the appraisal report, included South Kedu irrigation, Serayu barrage and Ijo Tipar drainage, and Lower Citanduy irrigation subprojects in Central Java; and Telang and Saleh agricultural development in South Sumatra. Noncore subprojects, subject to final approval during project implementation, included Kulon Progo (Opak-Serang) irrigation subproject in DI Yogyakarta, Batang Anai irrigation subproject in West Sumatra, and Wawotobi irrigation subproject in Southeast Sulawesi (see Map). Preparatory works were financed under Loan 518-INO: Wadaslintang Multipurpose Project, for $87.7 million, approved on 23 June 1981; Loan 725-INO: Technical Assistance Program Loan, for $25.0 million, approved on 18 December 1984; TA 857-INO: Telang and Saleh Drainage Improvement Project, for $350,000 from ADB and $300,000 from the Government of the Netherlands, approved on 23 February 1987; Loan 479-INO: Lower Citanduy Irrigation Project, for $55.2 million, approved on 13 November 1980; 1980 feasibility study of Sermo Dam, 1983 hydrological study of Sermo Dam, and 1985 detailed design of Sermo Dam financed by the World Bank; 1986 Dataran Anai feasibility study for the development of water resources financed by the Government of Italy; and 1989 detailed design study of Batang Anai financed by the Government of Indonesia. TA 5160-REG: Study of Food Demand and Supply and Related Strategies for Developing Member Countries (Phase II), for $500,000, approved on 23 October 1984; TA 673-INO: Study of Irrigation Management, for $350,000, approved on 27 March 1985; TA 937-INO: Efficient Irrigation Management and System Transfer, for $600,000, cofinanced by the Ford Foundation for $300,000, approved on 17 December 1987; Loan 860(SF)/861INO: Third Irrigation Sector Project, for $60 million, approved on 17 November 1987; and Loans 1014/1015INO(SF): Food Crop Sector Program, for $250 million, approved on 13 March 1990.

2 reduction in its area of influence as it would directly benefit about 260,000 poor and near-poor farm families. Average per capita income was anticipated to increase, at full development, from $55 to $125 per annum, which would then be above the projected poverty level. Increased farm income would be generated by expanding the irrigated rice area, and increasing cropping intensities and yields per hectare (ha). Construction activity was expected to generate additional employment opportunities: 6,500 person-years for skilled labor and 39,000 person-years for unskilled labor. The Project was also designed to provide institution building to strengthen the technical, management, and coordination capabilities of government agencies for planning and coordination, and for irrigation and agricultural development, as well as of irrigation committees and water users associations (WUAs). The project components included the following. 1. Part A: Irrigation Development

4. R&U of irrigation and drainage facilities. This included tertiary systems and other related infrastructure covering an aggregate area of 110,000 ha; and surveys and mapping, planning and detailed designs, and civil works. 5. Introduction of efficient O&M (EOM)6 in irrigation and drainage schemes. Covering an aggregate area of about 132,000 ha, this component included (i) review of existing staffing levels and O&M systems, procedures, and practices; (ii) determination of O&M requirements and preparation of manuals and training materials; (iii) training of O&M staff and WUAs; (iv) provision of equipment; and (v) introduction of EOM. The transfer of O&M responsibilities from the central Government to provincial irrigation services (PRIS) required project financing of incremental O&M costs, equipment, buildings, and training of irrigation service personnel; and the transfer of irrigation schemes with areas of less than 500 ha to WUAs. 6. Institutional strengthening. Focusing on provincial, district, and subdistrict irrigation services, district irrigation committees, and WUAs, the scope included establishing a project monitoring and evaluation unit in each PRIS, redeploying staff; and providing training (including specialized training overseas), equipment, and facilities. 2. Part B: Irrigation Service Fee

7. Introduction of an irrigation service fee (ISF). The Project provided consulting services, equipment, and facilities for introducing ISF for about 129,000 ha of the project area with the aim of achieving full recovery of O&M costs by fiscal year 1999/2000. 3. Part C: Agricultural Development

8. Strengthening of existing agricultural services. The scope included (i) establishing and operating tertiary demonstration units (TDUs); (ii) improving seed production; (iii) developing land, including clearing and leveling; and (iv) providing institutional strengthening. The activities included establishing about 22 TDUs, with each intended to (i) demonstrate proper on-farm water management techniques and related organizational arrangements at the tertiary level; (ii) serve as a field training ground for extension staff, local officials, and farmers; (iii) improve three existing seed farms and other facilities; and (iv) develop 4,000 ha into rice fields.
6

Defined as (i) the level of operation required to ensure the delivery of the right amount of irrigation water to the crop or the removal of excess water at the right time so as to make possible optimum crop production in an irrigation scheme; and (ii) the level of regular and periodic maintenance required to keep the system facilities and equipment in such condition that efficient operation can be achieved.

4.

Part D: Soil and Water Conservation

9. Establishment of soil erosion control measures. To safeguard the existing Wadaslintang reservoir in South Kedu, Central Java, project-specific interventions included (i) implementation of erosion control measures, such as terraces and waterways on 4,500 ha of critical land, and the construction of check dams; (ii) establishment of soil conservation demonstration farms; and (iii) training of farmers in erosion control techniques. 5. Part E: Women in Development

10. Support of the contribution of women farmers. Focusing on contributions to agricultural development and family welfare, a pilot subproject in Telang and Saleh was designed to encompass (i) inclusion of women in workshops, demonstration, training, and extension related to the O&M of improved drainage systems; (ii) strengthening of agricultural extension services to women farmers; (iii) establishment and strengthening of womens farmer groups; (iv) provision of assistance to setting up home industries; and (v) training of women village leaders and key women farmers. 6. Part F: Strengthening of Coordination and Monitoring

11. Strengthening of coordination and monitoring capability of development agencies. Focusing on regional development planning agencies (BAPPEDAs) at the provincial and district levels, the Project was to provide office buildings, equipment, other facilities, training, and consulting services. D. Cost, Financing, and Executing Arrangements

12. The total estimated project cost at appraisal was $264 million, including a $103 million foreign exchange component (Appendix 1). ADB financing of $200 million equivalent was provided through loan 1017 for $170 million from ADBs ordinary capital resources, and loan 1018 for $30 million equivalent from ADBs Special Funds resources. The ADB loans represented about 76 percent of total project costs and were to provide financing for 97 percent ($100 million) of the estimated foreign exchange costs, and 62 percent of the local currency costs ($100 million). The Government of the Netherlands was expected to make available about $8.0 million in cofinancing (half grant and half loan) for the Telang and Saleh core subproject. The Government of Indonesia was to finance the remaining local currency costs of $56 million. The loans were approved by ADB on 17 April 1990 and became effective on 10 August 1990. The Directorate General of Water Resources Development (DGWRD) was the principal executing agency. E. Completion and Self-Evaluation

13. The Project was completed in March 1997, about two years later than envisaged at appraisal. The project completion report (PCR),7 circulated to the Board in October 1999, rated the Project partly successful. It concluded that the physical targets of rehabilitating and upgrading irrigation and drainage schemes were essentially met. However, problems relating to inadequate O&M were experienced. The Project paid less attention to determining the readiness of WUAs to undertake O&M of tertiary systems. Difficulties in transferring O&M responsibilities related to
7

ADB. 1999. Indonesia. Integrated Irrigation Sector Project, Project Completion Report. Manila.

4 inadequate farmers knowledge of operational responsibilities, lack of skills for managing the schemes, insufficient involvement of the WUAs, and inadequate extension services. Capacity building to institutionalize ISFs and thus reach full cost recovery for O&M was not successful. The ISF program experienced operational and administrative difficulties. Procedures for ISF collection were complicated and time-consuming for the Government and WUAs involved. Despite the involvement of BAPPEDAS, effective monitoring and coordination of project implementation was difficult. Coordination was complex and multisectored across three levels of government. The economic benefits of the Project would be sustained only when EOM mechanisms were in place, supported by well-functioning WUAs and attainment of full cost recovery for O&M. While the estimated economic internal rates of return (EIRRs) of the subprojects and the Project were acceptable, continuing problems related to O&M, if not rectified, would likely curtail or substantially reduce future project benefits. F. Operations Evaluation

14. The project performance audit report (PPAR) focuses on pertinent aspects of the Project and presents the findings of the Operations Evaluation Mission (OEM), which visited Jakarta and the project areas in May 2001. The PPAR includes an assessment of the effectiveness of the Project in achieving its objectives, generating and maintaining benefits, and sustaining the operations of subproject irrigation systems and support services. It also deals with other important issues related to the results of the Project. The PPAR is based on (i) a review of project files and related documents; (ii) discussions with the staff of executing and implementing agencies at the central, provincial, and district levels including staff from the project monitoring and evaluation unit established under each PRIS; (iii) interviews with farmer stakeholders, spouses, WUA members, landless field workers, and key informants; and (iv) physical inspection of all subproject sites and major civil works. The PPAR also took into consideration the data and analysis presented in the PCR. Copies of the draft PPAR were submitted for review to the executing and implementing agencies, as well as to ADB staff concerned. Comments received were taken into consideration in finalizing the PPAR. II. A. PLANNING AND IMPLEMENTATION PERFORMANCE

Formulation and Design

15. The Projects goals and purpose were consistent with the Governments development needs and ADBs operational strategy for Indonesia at the time of approval and remained relevant at the time of evaluation. The Project followed the sector loan approach, which was considered the most appropriate and cost-effective method of ADB assistance in view of the number of subprojects. In addition, Repelita V was generally considered to be well conceived and appropriately formulated to meet the development needs of the irrigation subsector. DGWRD had been the executing agency for 28 loans and TAs from ADB, three under the sector lending modality, and as such was judged to have the necessary experience and capability to implement a sector loan. However, a detailed institutional assessment of DGWRD was not undertaken. 16. Project design strengths included the involvement of BAPPEDAs and the introduction of O&M as a project-supported activity. A project weakness was the inappropriate use of ADBs sector loan modality, due to the limited number (seven) of very large, geographically dispersed subprojects already identified and appraised (including feasibility studies and detailed designs) before project implementation. The methodology and selection criteria established for approval of noncore subprojects were sound and comprehensive. However, approval of the Batang Anai,

5 and Telang and Saleh subprojects should have been withheld based on technical and economic considerations. Less investment in large civil works, and more emphasis on investments in institutional aspects of O&M, would have likely resulted in better and more sustainable gains in O&M efficiencies and crop yields. A design limited to the three large contiguous subprojects in Central Java province alone, which accounted for about 75 percent of the project area, would have been simpler and more effective. Pressures to add seemingly small subcomponents (i.e., additional projects, pilot women in development [WID] activities, paddy seed production farms, and pilot watershed protection) disproportionately diverted limited resources from primary project activities. B. Achievement of Outputs

17. The physical targets were essentially met for R&U, EOM, TDU development, and watershed improvement works; and exceeded appraisal targets for the technical transfer of O&M for small-scale irrigation systems to WUAs. A list of physical achievements is detailed in Appendix 2. In general, tertiary infrastructure (farmer responsibility) and drainage and flood protection works were not fully completed. Land development fell significantly short of targets, primarily due to shortfalls in the Batang Anai subproject as a result of large areas of deep peat soils unsuitable for rice production. Training programs were partially successful, although more practical courses with field-level, on-the-job follow-up would have been more effective. The minor project components were too small to have a measurable impact and did not yield replicable models for the future. Details of project outputs are included in paras. 2644. C. Cost and Scheduling

18. Actual project cost was about $250 million, 5.3 percent below the appraisal estimate of $264 million. Differences were primarily due to (i) cancellation of the cofinancing arrangement of $8 million with the Government of Netherlands for the Telang and Saleh subproject,8 (ii) cancellation of various other project infrastructure works (particularly drainage), and (iii) depreciation of the rupiah from Rp1,815 to the dollar at appraisal to Rp2,342 in 1996. In addition, most civil works contracts contained no price escalation clauses. ADB financed all foreign exchange costs of $110.6 million (appraisal estimate $103 million), including $23.8 million in interest during construction and related charges, and about 63 percent ($87.3 million equivalent) of total local costs of $139.5 million (appraisal estimate $161 million). Government funding amounted to an estimated $52.1 million equivalent, or about 21 percent of total project costs. However, neither the PCR nor OEM could confirm the $16.3 million in Government project expenditures for administration and land acquisition because accounts were consolidated with other projects. 19. Compared with the original five-year project implementation schedule, actual physical completion was delayed by about two years, necessitating two loan extensions. Loan accounts were kept open for delayed payments until March 1998, and accounts were not officially closed until January 1999 (a total delay of 40 months). Delays in recruiting consultants, adverse weather (particularly major floods in 1992), and slow action by ADB (based on agency staff views) in issuing no-objection letters on award of many civil works contracts all contributed to lengthening implementation. Serious difficulties were experienced in sequencing and coordinating interrelated activities. In general, agricultural development activities preceded R&U works and adversely affected this project subcomponent. In the Serayu core subproject, canal
8

The Netherlands development assistance program for Indonesia was temporarily suspended shortly after the Project was approved by the ADB Board.

6 R&U works were completed well before the commissioning of the new Serayu barrage. Upon commissioning, new canal works suffered significant damage, as conveyance tests at full capacity were not completed. Additionally, following the cancellation of funding from the Netherlands, the recruitment of consultants and, therefore, the civil works for the Telang and Saleh subproject, were delayed for two years. D. Procurement and Construction

20. Procurement of consultants and contractors was overly complex because of the large number of packages used by the executing agencies. Bidding implementation was generally satisfactory. A number of executing agencies raised concerns regarding the length of time required to obtain ADBs no-objection letters for several civil works contracts. However, many of these delays resulted from (i) the executing agencies failure to adequately comply with ADB guidelines; (ii) inadequately prepared summary subproject reports9 in some cases; and (iii) legitimate technical engineering issues (i.e., design aspects of Sermo Dam in the Yogyakarta subproject). 21. Delays in the completion of subprojects and several cases of low standards of construction were generally attributable to weak supervision and poor organization of work by contractors. High construction contract cost overruns were not uncommon, and while they did not necessarily mean poor value for money, they could be indicative of (i) inadequate or inaccurate initial design surveys; (ii) poor design based on inadequate or inaccurate surveys; (iii) inaccuracies in taking-off of quantities, bills of quantities, and contract preparation; (iv) poor unit rate engineering estimates; (v) no mutual check zero10 carried out after the start of construction; (vi) inadequate site survey capabilities and use of day works measurement and routine certification procedures by site staff; (vii) variation orders (VOs) due to poor design/survey, contractor suggestions, local farmer requests, site staff proposals, and changes in specifications; (viii) excessive cost estimates in VOs or lack of preparation of VOs (inadequate or no design section in VO preparation); (ix) lack of willingness or technical ability of site supervisors to make obvious cost saving adjustments on-site; (x) poor management and site staff control of volume of work in the contract, in particular contractor manipulation of earthwork import, disposal, and transport items; (xi) the ability of experienced, well-managed contractors to dominate site construction and administrative procedures; and (xii) unrealistic bid prices leading to contractor claw back during construction. 22. Cost overruns on individual civil works contracts could have been significantly reduced within the existing procedural framework if staff resources and implementation techniques employed had strictly followed contractual procedures and routine information system maintenance. E. Organization and Management

23. Project components required implementation through six central Government agencies, five provincial offices, and dozens of district and subdistrict offices of each agency (Appendix 3).

Feasibility studies produced by the executing agency with assistance from project consultants. Government and ADB approval of the report was required for noncore subprojects to be formally included for financing under the Project. 10 A joint review by the contractor and the owner of quantities of work required at the beginning of a contract.

7 This, combined with a large number of contracts11 and a wide geographic spread (see Map), effectively made the Project unmanageable within Indonesias centralized framework. ADB fielded 16 review missions over the seven years of project implementation. Continuity from ADB was maintained because an experienced project engineer administered the Project for most of that period. However, while reviews were substantive and intensive, they could not adequately cover all components of all subproject areas. 24. Although the extent of possible corrupt practices cannot be known with any degree of certainty, the Project operated under conditions that would create an environment conducive for corruption. ADB review missions could not possibly oversee the award or construction supervision of the hundreds of large and small contracts dispersed over such a large geographic area. Implementation consultants had no role in overseeing contract awards and also lacked direct construction supervision control. Lack of accountability, poor record keeping, and highly underpaid agency staff with little linkage of performance to promotion persist in the Projects implementing agencies. Circumstantial evidence, based on a review of EOM contracts awarded under local competitive bidding procedures, indicates that collusion in bidding may have occurred, such that competing firms each received a fair share of the tendered civil works. Conducting the mutual check zero to determine agreed quantities of work on individual civil works contracts after the contractor had already started work was reported to be a common practice. Similarly, major contract variations occurred frequently.12 25. Overall compliance by the Government with loan covenants was generally unsatisfactory (Appendix 4). Of the 30 major loan covenants, 14 were fully complied with. Partial or noncompliance was noted for major covenants including (i) submission of audited accounts and progress reports, (ii) recruitment of additional staffing, (iii) strengthening of the South Kedu Water Operations Center, (iv) issuance of land titles and transfer of ownership to farmers, (vi) O&M funding, (vii) ISFs, and (viii) establishment of viable WUAs. III. A. ACHIEVEMENT OF PROJECT PURPOSE

Operational Performance 1. Part A: Irrigation Development

26. Physical targets of the R&U of irrigation and drainage schemes were generally met and exceeded appraisal estimates for the transfer of O&M responsibility to WUAs on schemes of less than 500 ha. Construction quality varied among subprojects with good results noticeable on Sermo dam, Serayu barrage, and some Wawatobi schemes. The irrigation development component suffered from implementation shortcomings due to inadequate project planning and design. These included (i) critical water shortages experienced in a number of subprojects; (ii) inadequate drainage and flood prevention facilities; and (iii) reduction in scope of some R&U works due to expensive design options, insufficient funds, or lack of time. 27. Inadequate procedures for system commissioning and handover to operational staff resulted in some systems operating below the design level. While EOM programs were
11

The PCR (footnote 7) Appendix 1, Table A1.6 lists a total of 893 contracts, including 303 civil works, 100 O&M, 221 equipment/vehicles, 63 consulting services, and 27 overseas and 179 local training contracts. Contract files, reports, and other loan documentation fill 52 boxes. 12 Although occurring after the fact, three civil works contractors who participated under the Project have been subsequently sanctioned by ADBs Office of the General Auditor as a result of corrupt or fraudulent acts on a succeeding project also located in one of the subproject areas.

8 introduced under the Project, most of the subprojects did not have O&M budget allocations. This led to infrastructure deterioration such as rusting gates, broken parts, siltation, and heavy weed growths on main canals. The impact of the institutional strengthening component and performance of the WUAs varied among the subprojects. Field-level institutions were established in most Central Java and West Sumatra subproject areas, and most of the training programs provided field staff with technical knowledge on infrastructure and O&M. Appendix 5 presents a detailed discussion of the achievements and performance of the seven subprojects. 2. Part B: Irrigation Service Fees

28. This component comprised introducing ISF for about 129,000 ha of the project area with the aim of full cost recovery of O&M by fiscal year 1999/2000. ISF for main system O&M was introduced under the Project in Central Java and Southeast Sulawesi.13 However, collection rates were not set to recover full O&M costs and typically Rp15,000Rp20,000/ha, less than 10 percent of O&M needs, was collected. ISF funds during the Project were collected by local government and were not linked to the provision of O&M services in the area where the funds were collected. WUAs had no control over the use of ISF collected from members. ISF was generally perceived as an additional government tax. 29. The OEM noted that in areas where WUAs were active, 100150 kilograms of paddy per crop (in addition to the above ISF) were contributed by WUA members to WUA funds for internal operations and tertiary O&M. 3. Part C: Agricultural Development

30. This component comprised (i) establishing and operating TDUs, (ii) improving seed production, (iii) developing 4,000 ha of rice fields, and (iv) providing institutional strengthening. A total of 22 TDUs and 14 satellite TDUs were established, meeting appraisal targets. Seed farms were rehabilitated in Tegalgondo and Serayu in Central Java, Telang and Saleh in South Sumatra, and Wawotobi in Southeast Sulawesi. At the tertiary level, the main agencies involved in irrigation development have key functions, working closely with the WUAs. TDUs generally were able to demonstrate significantly higher yields that were mainly attributed to improved agricultural inputs and practices rather than to improved water management techniques. Constraints to TDU activities included (i) timing of TDU implementation vis-a-vis main system activities, (ii) farmer resistance to construct new tertiary infrastructure, (iii) lack of quality topographic and soil data, and (iv) lack of trained water management extension workers. 31. Only 1,638 ha were developed compared with the appraisal target of 4,000 ha: 1,400 ha in four Wawotobi subprojects and 238 ha in Serayu. Development of a further 1,929 ha postproject in Batang Anai was stated to be complete, but this could not be demonstrated to the OEM. All project land development areas visited by the OEM appeared appropriate and utilized. However, some areas in the downstream reaches of Wawotobi were suffering from water shortages, double cropping was not practiced, and available labor was sometimes constrained for these subprojects. In addition, major secondary swamp forest was visible in areas reportedly cleared under the Project on Batang Anai.

13

Central Java has one of the most successful collection areas in the country. Recent regulations in Central Java reversed a 1998 governors instruction to stop ISF collection; in many locations ISF collection reportedly continues but under WUA management.

9 32. The overall impact of the agricultural development component was marginal. Most TDU programs were carried out before irrigation systems were upgraded. This aggravated field operation problems and precluded most water management extension activities (often due to lack of water control structures and/or lack of water). TDU operations that began after R&U works generally lasted only 12 years, and few TDUs continued after project funding stopped. Although data are not available on farmer outreach, in terms of adoption rates of improved practices, the OEM estimates that the TDU program did not result in a significant increase in yields in the seven subproject areas. Rehabilitation significantly increased the capacity of the seed farms to produce higher yielding certified seed. However, widespread increased use of certified seed by project farmers is not evident due to (i) uncertainty about the quality and benefits of certified seed, (ii) higher prices than for seed purchased from other farmers, and (iii) timely availability of seed. 4. Part D: Soil and Water Conservation

33. This component comprised establishing soil erosion control measures to safeguard the existing Wadaslintang Reservoir in South Kedu, Central Java. The risk to Wadaslintang Reservoir was documented by ADB in the PPAR for the Wadaslintang Multipurpose Project (footnote 4). The older Sempor Reservoir is designed to augment supplies to the South Kedu irrigation subprojects but suffers from water shortages because of reduced reservoir storage. Small-scale physical interventions were included under the Project for 4,500 ha of critical land in the watershed. Although adequately constructed, the works are considered inadequate in nature and scope to have any significant positive impact on the overall watershed condition. 34. Sediment monitoring is not carried out by Wadaslintang Reservoir operators, despite the long-standing concerns about reservoir storage capacity and the availability of echo-sounding equipment on the nearby Sermo Reservoir where monitoring surveys are undertaken biannually. The ongoing South Java Flood Control Sector Project14 (SJFC) includes catchment protection activities in the Wadaslintang Reservoir catchment area. However, consultant reports indicate that ongoing activities are unlikely to seriously address the sedimentation problems emanating from the watershed. 5. Part E: Women in Development

35. WID activities commenced in late 1993 on a pilot basis in Telang and Saleh. The South Sumatra Provincial Agricultural Service implemented the component with assistance from the consultants, who designed and implemented training activities for 1,300 participants in 10,930 training days. In general, technology transfer and institutional development programs were directed at the head of the household, although only a small percentage of them were women. The most successful intervention was the project-supplied drinking-water storage tanks that reportedly had a significant impact on reducing waterborne diseases. WID activities in the project area ceased after the Project. 6. Part F: Strengthening Coordination and Monitoring

36. Under ADB TA 1363-INO,15 four monitoring and evaluation (M&E) models were developed and tested in 19921993, using the Project as a pilot area. The models all included methodology for measuring (i) financial progress, (ii) physical progress, (iii) water management,
14 15

Loan 1479-INO: South Java Flood Control Sector Project, for $103 million, approved on 7 November 1996. TA 1363-INO: Strengthening Project Benefit Monitoring and Evaluation Activities of the Directorate General for Water Resources Development, for $458,000, approved on 22 August 1990.

10 (iv) project benefits, and (v) environmental impact. The TA provided a robust, simple, and flexible M&E system that minimized new field data collection and therefore allowed high geographic coverage at low incremental cost. During the TA, ADB consultants recommended that the M&E system be introduced into project provinces. Instead, the M&E activities under part C of the Project designed a detailed database based on rapid rural surveys and devised an M&E technique based on logical framework techniques. The M&E system was to monitor and evaluate the impact of budgetary support interventions in any sector. The method, which was adopted nationwide, used, in sequential order, a set of development parameters to track the expenditures. This system was not designed specifically for the irrigation sector and the M&E proposal designed under TA 1363 was not directly or indirectly used. The two systems were conceived to perform different tasks: (i) the TA used time-based systems for M&E, and (ii) the Project used a logical framework general procedure to monitor the impact of individual budget expenditures. 37. Under part C, the project M&E units of the provincial water resources service (PWRS) were not strengthened in monitoring irrigation system performance. They were directed away from the models prepared under TA 1363 toward collecting primary data through surveys, focusing on detailed information on sample schemes rather than global coverage, annual performance monitoring against predetermined targets (measured as a ratio rather than absolute parameters), and discontinuing the simple time series presentation of M&E reporting. As a result of the change in focus of the project M&E away from the irrigation sector, the advances made under the World Bank Irrigation Sector Support Project and TA 1363 were severely curtailed. The OEM found no continuation of routine M&E of the irrigation sector in any of the project provinces except Southeast Sulawesi. The Central Java M&E Unit is considered to be active but is preparing detailed expensive reports focusing on measuring performance against short-term budget expenditure rather than irrigation sector M&E. 38. Coordination activities of BAPPEDA under part F were institutionally difficult (perhaps inappropriate) as project funds were channeled through national-level funding mechanisms in all sectoral agencies. BAPPEDA and provincial and district irrigation and agriculture organizations had, during project implementation, no direct management role or responsibilities in implementing project activities. Terminology in the appraisal report does not differentiate between nationally funded, provincially based irrigation projects from provincially based, provincially funded (Dinas) organizations. B. Performance of the Operating Entity

39. DGWRD and its provincial, district, and subdistrict irrigation agency counterparts from the subproject areas have successfully executed and implemented many funding agencyassisted projects. Together, they have thousands of engineers who have been the recipients of numerous government and funding agency-sponsored formal training programs, as well as technical knowledge transfer from specialized consultants over the past 20 years or more. However, the Project still relied heavily on the use of domestic and international consultants in its implementation, with the executing agencies focusing on their administrative role and construction supervision. For survey and design of irrigation and drainage works, the shortcomings included (i) low status of the provincial hydrology units and the failure to process incoming hydrology data at the provincial level; (ii) lack of staff time to monitor developments by other agencies, such that programs for paddy development were not well coordinated with overall special planning activities; (iii) relative inexperience of technical staff who checked designs by domestic consultants; (iv) lengthy administrative procedures and poor information systems; (v) insufficient time in the field to ensure that main system designs were adequate;

11 (vi) unprogrammed time-consuming redesigns of ongoing construction works; (vii) lack of fulltime qualified surveyors; (viii) low budget allocations (on a per hectare basis) to domestic design consultants; (ix) consultants' work often preceding contract administration, which led to some confusion in supervisory duties and the timing of consultant submittals; and (x) lack of any supporting programs to establish and coordinate WUA involvement in design activities. 40. Many of these shortcomings were amplified by (i) the inexperience and lack of endproduct concern by many domestic design consultants, and (ii) the absence of quality assurance procedures in routine contract execution and supervision. C. Economic Reevaluation

41. Based on directly quantifiable benefits and costs, the EIRR of the overall Project has been reestimated by the OEM at 8.3 percent, compared with the appraisal estimate of 15.9 percent and the PCR estimate of 13.4 percent. The EIRRs for the various subprojects range from 12.6 percent for the South Kedu subproject to 3.1 percent for the Batang Anai subproject, all lower than those calculated at appraisal and at project completion (Appendix 6). 42. Sensitivity analyses carried out for changes in yields, cropping intensities, crop prices, and production costs indicate that relatively modest changes (either positive or negative) would have a significant impact on economic efficiency. However, yields and production on Java during the 1990s stagnated. The Governments lack of progress in reversing watershed degradation or improving O&M makes any positive change in this trend unlikely. D. Sustainability

43. Sustaining project facilities and outputs requires an effective irrigation O&M program. A de facto culture of deferred maintenance of irrigation systems, which was fostered by project support for R&U, resulted in scheme rehabilitation investment that was six to seven times higher in present value terms than that required if maintenance had been satisfactorily undertaken.16 Although O&M funding remained constant in real terms during project implementation, allocated funds were used primarily for provincial irrigation agency staff remuneration and only 1540 percent was generally used for urgent repairs and minor civil works. Since 1997, funding has been provided to provinces as part of the general provincial block-grant transfer mechanism. This, in conjunction with the fiscal crisis, has resulted in the allocation by provincial governments of even fewer resources for O&M than expected in the central Governments block-grant budgeting assumptions. Due to the rupiah devaluation, the value of the budgeted O&M subsidy has been reduced from about $1215 equivalent/ha before 1997 to $34 equivalent/ha thereafter. 44. The Government and ADB recognized the inadequacy of irrigation O&M during project design. However, ADB believed that the Governments 1987 Statement of Policies for Irrigation Operation and Maintenance (IOMP),17 combined with a 15-year action plan and support from ADB and other funding agencies, would result in an efficient O&M program throughout the country, with 100 percent of the financial burden carried by water user beneficiaries. In retrospect, the IOMP had the right policy goals, but conditions did not exist for effective implementation. It was promulgated through confidential policy dialogue with funding agencies without the benefit of public consultation. Ownership of the IOMP within the Government was
16 17

Based on World Bank average estimates for all irrigation systems in Indonesia. The full Statement of Policies for IOMP is given in Appendix 3 of the appraisal report.

12 never strong. It was also bound to fail because of (i) inadequate legal and regulatory frameworks; (ii) weak sectoral institutions for integrated planning and management; (iii) involvement of a number of uncoordinated government agencies pursuing narrow functional mandates; (iv) ineffective administrative and implementation performance of provincial and district irrigation agencies; (v) complexity of staff deployment and performance incentives, budget transfer, and organizational structure to implement the IOMP; (vi) the absence of mechanisms for beneficiary participation in decision making; and (vii) inconsistent and unreliable data and management information systems for irrigated areas. IV. A. ACHIEVEMENT OF OTHER DEVELOPMENT IMPACTS

Socioeconomic Impact

45. Direct project benefits have been captured primarily by small farm families with incomes near or below the poverty line. However, due to the very small average farm size, adverse price trends of inputs and outputs, and the lack of progress on crop diversification, a significant percentage of beneficiaries are unlikely to have achieved economic status permanently above the poverty line. Off-farm income, often representing 3050 percent of farm family income, has also been significantly affected by the financial crisis. Based on the appraisal report, the large majority of farmer beneficiaries had operational holdings of 0.5 ha or less, with the exception of farmers in the resettlement areas of the Telang and Saleh, and Wawotobi subprojects, where farm sizes averaged 2.0 or more ha. The OEM estimates that over the past 10 years, farm sizes in Central Java and DI Yogyakarta subproject areas have decreased to an average of 0.250.40 ha due to ever-increasing population pressure and, recently, from reverse migration from large urban areas. However, in the Telang and Saleh areas, farm size has increased dramatically to 4.06.0 ha because many original settlers have left the area due to depressed socioeconomic conditions. Estimates of average farm-family crop income in the future with and without the Project are given in Table 1. 46. Income increases in US dollar terms range from 17 percent for Central Java subprojects to 115 percent for the Batang Anai subproject. However, average increases may distort the real situation at the individual farm level, based on the location of the farm in the system. Farmers in the upper third of most irrigation systems (closest to the main and secondary canals), who likely received adequate water supplies even before the Project, would be largely unaffected by project investments. Conversely, farmers in the lower end of the systems, who previously received little or no water, may have experienced a doubling of both cropping intensity and yield, and resulting income increases of 300400 percent. 47. Although estimates are not available, project activities during implementation likely required close to the appraisal estimate of 39,000 person-years of unskilled labor, as most civil works were simple and labor-intensive. The OEM also estimates that higher cropping intensity and incremental rice production have directly and indirectly created an additional demand of 25,00030,000 person-years of annual employment.

13
Table 1: Annual per Hectare Farm Budgets for Rice Paddy Crops (Rp'000)
Kulon Progo Central Java Telang-Saleh Batang Anai Wawotobi With Without With Without With Without With Without Without With Project Project Project Project Project Project Project Project Project Project Rainfed Irrigated Irrigated Rainfed Irrigated Irrigated Rainfed All Areas Rainfed Irrigated Irrigated Irrigated Areas 4,711 1,732 2,979 $270 1,192 $108 12,078 4,978 7,101 $644 2,840 $258 17,002 6,722 10,280 $932 4,112 $373 4,711 1,732 2,979 $270 1,192 $108 14,162 5,644 8,518 $773 3,407 $309 16,475 6,466 10,008 $908 4,003 $363 2,154 1,106 1,048 $95 2,096 $190 2,550 1,278 1,273 $115 2,545 $231 2,692 1,433 1,259 $114 504 $46 7,439 3,624 3,815 $346 1,526 $138 13,717 5,517 8,200 $744 3,280 $297 9,004 3,900 5,104 $463 5,104 $463 12,645 5,203 7,443 $675 7,443 $675

Item Revenues Expenses Income (Owner) Income (Tenant)

Source: Project Completion Report and OEM estimates.

B.

Environmental Impact

48. The flood control and drainage measures for the Central Java core subprojects are assumed to have reduced flooding in agricultural, village, and some semiurban areas. However, no reliable data are available on the reduced incidence of flooding, which remains a serious problem in many areas. The success of the national integrated pest management program, ongoing since 1988, the removal of pesticide subsidies in 1989, and the inclusion of integrated pest management demonstrations in the agricultural development program for the projectsupported TDUs have likely reduced pesticide usage in rice production in the subproject areas. Fertilizer use is estimated to have slightly increased due to the marginal increases in cropping intensities, offset by the deteriorating paddy-fertilizer price ratios because of the reduced price support for paddy and gradual removal of fertilizer subsidies induced by the financial crisis. As reported in the PCR and confirmed by the OEM and other ADB studies,18 increasing population pressure, unregulated land use (particularly cassava production on steep slopes), and unabated deforestation have caused extremely high rates of soil erosion in six of the seven watersheds above the subprojects irrigated areas. The impact of these increasing soil losses will include (i) a shorter than expected life of the Sempor, Wadaslintang, and Sermo reservoirs, which serve subproject areas in Central Java and DI Yogyakarta; (ii) sediment disposition behind all major weirs, in canal networks, and main river offtakes, which will reduce irrigation supplies significantly below design capacity (and will require costly annual maintenance); (iii) increased flooding and drainage problems; and (iv) loss of important fishing grounds and mangrove complexes in the lagoons that serve as drainage outlets to the sea in Central Java and DI Yogyakarta. The Project partially addressed these problems with the soil and water conservation component in the Wadaslintang watershed and partial dredging of the Sagara Anakan lagoon in the Lower Citanduy subproject, but erosion and soil deposition rates continue to increase. C. Impact on Institutions and Policy

49. The introduction of ISF was slow and complex, and collections problematic. Projectfinanced R&U and EOM, combined with central Government subsidies for O&M (also
18

TA 2665-INO: Institutional Strengthening of the Forestry and Soil Conservation Services in the Segara Anakan Basin, for $250,000, approved on 17 October 1996.

14 covenanted under the Project), gave a mixed signal, namely, that there was little need to be serious about collecting ISF. This undermined the urgency of reforms. Project implementation arrangements split functional subproject organization from the regular structure of the provincial irrigation agencies involved and put control in the hands of managers familiar with civil works who were motivated to achieve physical and financial targets, but unfamiliar with and generally uninterested in implementing institutional reforms (i.e., strengthening WUAs and ISF). The topdown approach used for forming WUAs resulted in leaders being chosen from above rather than through a bottom-up organization. The focus on establishing WUAs to meet targets was easily disconnected from substantive development of management capacity for irrigation O&M. This explains the large number of WUAs that have become inactive. By disregarding existing local farm organizations, the social capital embodied in existing networks among farmers, their mutual trust, and history of cooperation were neglected. These local organizations had been responsible for the original construction of many small irrigation schemes, including areas later incorporated into larger schemes. 50. Project support for the IOMP did not change the underlying dynamics of irrigation development. The Government continued its role as an operator, directly implementing activities rather than assuming the role of an enabler. Farmers gained some means for a greater voice, but technical, legal, and organizational services to aid WUAs were largely absent, except for the Governments own targeted programs directly delivering conventional classroom training that was not conducive to the effective development of WUAs. V. A. Relevance OVERALL ASSESSMENT

51. Overall project relevance has changed considerably in some respects from the time of approval to evaluation. Project goals of increasing farm productivity, creating new employment opportunities, and improving the living standards of farmers, the majority of whom are living below or near the poverty line, remain highly relevant. Achieving this through investments to improve irrigation efficiency and O&M similarly remains cogent. However, funding agencysubsidized investments (primary beneficiaries contribute nothing to the investment costs and little to O&M) in large-scale R&U (i) foster a deferred maintenance culture, (ii) are an estimated six to seven times more expensive than annual maintenance, and (iii) result in only temporary marginal improvements in irrigation efficiency. The highly top-down centralized approach of project design and implementation and lack of public consultation on policy reforms are also outdated. Major investments in isolated transmigration areas for transforming fragile swampland into irrigated rice areas (Telang and Saleh subproject) has also been largely curtailed as they have generally been shown to be economically, ecologically, and technically unsound. Based on the rationale of the Project and relevance of project design at appraisal, the Project is assessed as relevant, although borderline to being partly relevant due to the weaknesses discussed. B. Efficacy

52. In general, the Project achieved its physical targets for R&U, TDUs, introduction of EOM, transfer of facilities and small irrigation systems, establishment of WUAs, WID, soil and water conservation, and training. The higher cropping intensities and rice yields resulted in substantial incremental output of rice, increased farmer incomes, and job creation, but these were lower than the optimistic appraisal expectations. Growth in rice crop yields and farm income have been affected by deteriorating rice-fertilizer price ratios and the economic recession. Physical completion of R&U, which dominated project expenditures, was significantly delayed and in

15 most cases did not achieve full restoration of capacity or efficiency of the irrigation systems. Project funding was inadequate to fully address all system needs (particularly drainage and tertiary canal development), yet supported some works that may not have been technically or economically justified (i.e., construction of large new weirs rather than rehabilitation of existing weirs, and overextension of canal lining). Deterioration in most systems started soon after project completion due to less than adequate O&M funding and management. Progress on ISF has not been significant, and development of self-sustaining WUAs was largely not achieved. Overall, the Project is assessed partly efficacious in terms of achieving its stated purpose and targets. C. Efficiency

53. The EIRR estimates for the seven subproject areas range from 12.6 percent for the South Kedu subproject to 3.1 percent for the Batang Anai subproject. Although the selection criteria for approval of noncore subprojects were sound and comprehensive, approval of the Batang Anai, and Telang and Saleh subprojects should have been withheld based on technical and economic considerations. Gains in O&M efficiency and crop yields could have been greater and achieved more efficiently and sustainably through much less investment in large civil works, and more emphasis on investments in institutional aspects of O&M. These include PRIS systems and procedures for planning and operating irrigation systems, assessing water availability and demand, operating reservoirs, and upgrading basic system information. Efficiency gains could also have been higher if the project had placed more emphasis on tertiary system development tied to improvements in empowerment and organizational capacity of WUAs for better irrigation management. Given the acceptable overall EIRRs in two of the seven subprojects, and the overall project EIRR of 8.3 percent, the Project is assessed partly efficient. D. Sustainability

54. Overall, under current circumstances, the sustainability of irrigation systems operations and project incremental outputs is assessed as less likely. The unabated deterioration of project watersheds will continue to cause flooding and drainage problems in the wet season, reduce water availability in the dry season, exacerbate the problems associated with increased sedimentation, and reduce water quality over time. Fiscal austerity induced by the continued financial crisis and the move toward decentralization have substantially reduced central Government funding for O&M, which was already inadequate prior to the crisis. Fiscal austerity has also affected financial incentives for farmers to use the level of inputs required for continued high rice yields. ISF policies have not been effective. ISF payments have continued to dwindle and have not been able to reduce the fiscal burden on government resources for O&M. Turnover of small irrigation systems has had some success, but the majority of WUAs in these systems remain incapable of performing adequate O&M, as do the large majority of WUAs on large-scale systems. High population pressure, particularly on Java, and continued urbanization and industrialization will continue to reduce commandable irrigation area and compete more aggressively for reduced supplies of quality freshwater. Hope for the future rests with a seemingly renewed resolve by the Government, combined with a better, more focused approach by funding agencies,19 to deal effectively with the institutional, regulatory, and legal issues at the root of many problems in the water sector, which have now reached crisis proportions.

19

Such as the World Banks Water Sector Adjustment Loan (WATSAL).

16 E. Institutional Development and Other Impacts

55. The Projects substantial commitments to improve institutional capacity at all levels within the irrigation subsector were laudable but yielded little long-term impact. WUAs were not, in general, developed into effective, empowered, self-sustaining farmer organizations. The IOMP and ISF programs were an admitted failure, although they have been replaced since 1999 by more potentially meaningful reforms under WATSAL. The EOM program has been effectively halted. The Projects impact on poverty reduction was likely very significant in limited areas within command areas of most subprojects, particularly areas where flooding and drainage were substantially improved and/or cropping intensities effectively doubled. Overall, institutional development and other impacts of the Project are assessed as low. F. Overall Project Rating

56. The overall project rating, based on the analysis of existing reports and data, the findings and observations of the OEM, and a weighted matrix of the above five rating criteria, is only partly successful. The Project has substantially achieved most of its physical targets and improved the incomes and welfare of a large percentage of poor farm families in the areas covered by the Project. However, there have been (i) substantive shortfalls on O&M, WUA development, and cost recovery targets; (ii) significant shortfalls in improvements in WID and executing agency institutional capacity; (iii) accelerated deterioration of watersheds and resultant problems of sedimentation, drainage, and flooding in a number of subproject areas; (iv) insufficient attention to tertiary irrigation and drainage canal development; (v) negligible long-term impact of TDU and seed production components; (vi) substantial noncompliance with major loan covenants on irrigation policy reforms; and (vi) questionable selection of some subprojects for investment. Issues (i), (iii), and (vi), in particular, represent a significant threat to the productivity and sustainability of irrigation infrastructure, and have already adversely affected achievement of projected full development benefits of the Project. G. Assessment of ADB and Borrower Performance

57. Based on discussions and descriptions of project design and implementation throughout the PPAR, the Borrowers performance in project undertakings is rated as less than satisfactory. The complex organizational arrangements and the difficulties in coordinating activities among the various executing agencies support this rating. ADBs performance is rated satisfactory as monitoring and supervision of project activities by ADB staff is deemed adequate. VI. A. ISSUES, LESSONS, AND FOLLOW-UP ACTIONS

Key Issues for the Future

58. For sustainability, a holistic, project-cycle, sector approach to irrigation development requires a long-term commitment (810 years) to institutional development and capacity building in a project area. The Project, like ADBs East Nusa Tenggara Irrigation Sector Project20 and Third Irrigation Sector Project (footnote 2), failed to provide long-term replicable sectoral support to strengthen institutions in the regions covered. A stop-start approach to irrigation development reduces opportunities for institutional capacity building, leads to an inefficient deferred maintenance regime, and raises false hopes with water users and government agencies that development will continue in a well-planned, long-term manner. A long-term commitment to irrigation sector development is required, with major sectoral
20

Loan 952(SF)/953-INO: Nusa Tenggara Agricultural Development, for $25 million, approved on 7 February 1989.

17 institutional changes addressed through other loan modalities. ADBs sector development program approach, combining a sectoral investment and program modality within a long-term framework,21 is considered appropriate. 59. The decentralization legislation of 1999 and ongoing major water sector reforms (WATSAL), which are delegating responsibility for irrigation O&M to WUAs, and reorganizing and redefining river basin management, are fundamental. These far-reaching reforms are crucial to sustainable management of the enormous investments in this sector. O&M under the Project followed the 1987 IOMP, which was unsuccessful principally because of (i) lack of delegation of budget and responsibility; (ii) inadequate understanding during program design of the institutional setup; and (iii) an inappropriate environment for WUA participation. EOM was designed for all projects of the World Bank and ADB (prior to ADBs loans 860(SF)/861) to be just another project activity. As such it bypassed, and effectively weakened, the role of local government agencies in system O&M. 60. Farmers, and collectively WUAs, were not generally involved in a participatory manner in project activities. Paternal, top-down attitudes of all executing agencies, together with (i) inappropriate funding mechanisms, (ii) less than satisfactory institutional project design, and (iii) less than optimum use of consultants and nongovernment organizations, all contributed to a lack of beneficiary participation. The involvement of WUAs in irrigation management at the main system level, despite irrigation committees, was ineffective. At the tertiary level, and often at the secondary level, farmers reacted to their own needs through seasonal maintenance and simple operational activities. On-farm water management and tertiary development were not adequately addressed under the Project. Tertiary designs and water management without WUA participation led to incomplete development of tertiary systems. Considerable effort on WUA strengthening and legal reform was made under the project training and institutional activities. These were partially successful in their own right, but were not coordinated with implementation and utilization of physical works. TDUs were successful in introducing short-term demonstrations and catalyzing dialogue between agencies. TDUs were not sustained and a successful model for the extension services to WUA for on-farm water management remains unavailable. 61. Under the project design, ADB and Government resources required to ensure efficient and effective implementation were severely stretched. The Project, executed through six government agencies, was geographically diverse and included three unusual subprojects: (i) Batang Anai with peat soils; (ii) Wawotobi with high land development needs; and (iii) the core subproject Telang-Saleh, a major swamp pilot project accounting for some 25 percent of the project area. These subprojects were not representative of the irrigation sector in Indonesia and had major technical differences from the Java irrigation subprojects. Limiting the Project to Java subprojects, which were more homogeneous, contiguous in area, and similar in development requirements, would have significantly simplified implementation and allowed major works and activities (drains, flood prevention, tertiary development, and institutional support) to be finished. 62. A considerable effort was made under the Project and under TA 1363 (footnote 15) to provide and test a framework for irrigation sector M&E. Activities under Part F failed to institutionalize the results of this TA and currently, while effort and interest in the project M&E field has been considerable, the lack of a national policy to institutionalize M&E activities leads to considerable wasted effort and poor information available for irrigation sector managers.
21

An implementing modality similar to the adjustable program loan of the World Bank could also be considered.

18 More effort by ADB and the Government is needed in the future to ensure that benefits and synergies from previous sector interventions are fully exploited. 63. The ongoing ADB-supported Segara Anakan22 and SJFC projects23 have activities in the Lower Citanduy core subproject area. Drainage, flooding, and sedimentation problems are complex and severely affect the sustainability of the Segara Anakan lagoon and Lower Citanduy subproject. A comprehensive river basin development plan including a review of the results of TA 2665 (footnote 18) and a subsequent implementation program under the Segara Anakan loan are required. 64. Watershed activities under the Project were of a piecemeal, pilot nature, and had insignificant effect on sediment reduction. High and continuously growing sediment yields due to deforestation, population pressure, and changing land use in upper watersheds are an increasing threat to irrigation and drainage infrastructure sustainability. Part D (paras. 33-34) provided a basis for coordination dialogue between agencies involved in water resources development and watershed protection in the project area. Future investments in major R&U should only be considered in areas where upper watersheds are stable or where equal attention is given to watershed protection such that rates of soil erosion (and therefore sediment yields) will be within acceptable limits to ensure sustainability of water infrastructure. Significant interventions are still required to address major concerns regarding sediment runoff and sustainability, particularly in the Wawotobi and Citanduy subprojects. 65. Access roads built under the Project were seen to be very beneficial to overall rural development providing access to markets, landholdings, and infrastructure. Due to funding constraints a number of roads were canceled and maintenance on a significant portion of roads constructed has deteriorated. Adequate coverage and maintenance of suitable roads is essential and should include (i) access roads along all primary and secondary canals, (ii) access into all tertiary areas, (iii) paved access to subproject area and local markets, and (iv) access to all primary and secondary drains. B. Lessons Identified 1. Project Design and Formulation

66. Nationally managed provincial irrigation project activities need to be transferred to the local PWRS and district water resources services. The pressure to retain control at the center (national and provincial) rather than to delegate and decentralize continues to decrease institutional and project implementation efficiency. During project design, institutionalization of project activities needs to be given priority. The optimal arrangements for decentralization need to be determined, with proper definition and assessment of roles, responsibilities, and absorptive capacities of PWRs and district water resource services. All future irrigation development projects should be formulated with mechanisms encouraging and ensuring the full participation and ownership of beneficiaries with the support of PWRS and district water resources service for future system management.

22

Loan 1476-INO(SF): Segara Anakan Conservation and Development Project, for $22.8 million, approved on 17 October 1996. The project has inadequate watershed management components to control the high level of sediment present in runoff that enters the Lower Citanduy and lagoon area. 23 The Citanduy SJFC subproject office informed the OEM that they were using a 1975 Citanduy Flood Master Plan for piecemeal selection of works. A recent mathematical model designed under part A of the Segara Anakan Project should be used for the basis of a detailed review of drainage and flooding in the Citanduy River.

19 2. WUAs and Beneficiary Participation

67. WUA formation and operational efficiency are prerequisites to the implementation of government policy in many aspects of irrigation development. PWRS does not have an appropriate social orientation to carry out WUA establishment and training activities effectively. Beneficiaries must participate if they are to feel a sense of ownership and responsibility, which will also effect attitudes to ISF and O&M. The impact of institutional development in this regard has been limited. Lack of appreciation of the need to develop linkages with target groups during WUA formation has hindered programs for WUA development. In forming WUAs, care has to be taken to minimize disruption to existing social structures. 68. Farmers are reluctant to form and join government-induced WUAs that substitute for traditional associations that have survived for a long time. WUA establishment and strengthening should be accelerated with a focus on (i) quality organizations, (ii) involvement in tertiary and main system O&M, and (iii) a clear linkage between irrigation service and ISF. As the Government has not been able to adequately fund postproject O&M, private O&M managers, financed by WUAs, should be considered as an alternative to publicly provided O&M. The number of WUAs that require formation and training is beyond the scope of a single short-term project. All future development projects should include components specifically orientated toward WUA development. However, WUA institutional building is a complex process: appropriate performance indicators must be identified and progress of capacity building efforts strictly monitored. An institutionalized PTGA (on-farm water management) subproject, working through BAPPEDA or routine extension service organization, should be used to coordinate the activities. However, training activities require administrative, logistical, and organizational assistance. Full-time PTGA subproject working teams will be necessary for the larger irrigation schemes like Serayu and Citanduy and in districts with significant irrigation developments. Training at the field level (PTGA level C) with a two-year routine follow-up program and regular backstopping activities are required for all technical irrigation and village schemes in accordance with the respective development programs. The training and PTGA unit should be institutionalized and training budgets provided through routine regional development budget sources at district and provincial levels. 3. The Project Approach and Coordination Issues

69. Regular coordination meetings within provincial and district BAPPEDA are important and should concentrate on the needs for interagency planning; identification of planning priorities; and assessment of proposals for scheme, subproject, and sector M&E, as well as institutional development coordination. Interagency action programs for irrigation development can be successful through regular consultations at BAPPEDA-chaired routine meetings. PWRS needs to strengthen its technical department for irrigation planning and design, BAPPEDA needs to allocate regular budgets to fund such meetings, and beneficiaries need incentives and assistance to participate in bottom-up planning and implementation activities. An appropriate cost recovery mechanism could be arranged to ensure that provinces and districts are able to raise adequate funds to finance their policymaking, coordination, and monitoring functions. 4. Project Implementation

70. Strengthening of administrative sections of PWRS and district water resources service through the focused training of administrative staff and streamlining of procedures is required. The gradual increase in depth of experience in technical departments should free senior staff from involvement in routine administrative issues if appropriate delegation of tasks can be

20 achieved. The proposed introduction of efficient management information systems could also be very effective in promoting the more efficient use of staff time. Special care needs to be taken in preparing budgets, cost estimates, and realistic implementation schedules. Designs, bills of quantities, and contracts must be carefully checked by the project staff. This involves senior staff spending more time and effort on supervision. All checking should be carried out independently within a quality assurance framework. 5. Irrigation Development Policy

71. More involvement of provincial and district authorities and beneficiaries in key policy directives is essential. Implementation of Government O&M policy (and WATSAL) should be formulated, explained, and discussed jointly with the PWRS district and provincial managers, BAPPEDA (provincial and district), and other senior provincial government officials in a participatory manner. Understanding of, and/or preparation for, the implications of the policy on short-term and long-term planning is minimal. A long-term provincial/district irrigation development plan should be ratified by provincial planners and beneficiaries, and used for annual program definition. 6. Comprehensive Program for Irrigation Scheme Commissioning

72. Commissioning requirements have only been studied at the demonstration subdistrict offices. A two-year commissioning period is generally required for adequate development programs for medium-scale schemes with a four-year period for large and major schemes. Programs should include (i) (ii) continued training of staff and WUAs in operating schemes until an optimum acceptable management level is reached; minor modifications and infrastructural improvements that may be necessary for structures and gates to ensure accurate measurement and control and/or system extensions; development of adequate information techniques for reporting crop planting activities from the field to the operators; adjustment and change from a theoretical (as designed) water allocation system to one based on actual needs (social and technical), calibration of measuring structures, and the development of appropriate water management techniques; adjustment and optimization of needs-based budgets; familiarization period between operators and farmer groups necessary to develop relationships and trust; minor repairs to structures that may have been overlooked by the contractors and supervision staff; review of tertiary system infrastructure; and purchase and commissioning of necessary equipment and training in its use. Difficulties in Promoting Farmer Participation in Irrigation Development

(iii) (iv)

(v) (vi) (vii) (viii) (ix) 7.

73. Community organizers are required to ensure beneficiaries participate in government-led activities. However, a sustainable mechanism should be introduced whereby project beneficiaries are not dependent on community organizers. Farmers need to participate and be organized into WUAs (or other suitable institutions) at the earliest possible stage of system planning. Ensuring farmer involvement in tertiary system construction and main system design, and prior to agreement on the modality of subproject development and O&M, is essential. For

21 farmers to be available to participate in planning and design activities, field motivators must be active and in place in a timely manner, coinciding with the fielding of the survey, investigation, and design consultant. All costs and time-consuming coordination activities should be borne by a community organizer consultancy or integrated into the survey, investigation, and design consultancy. 74. To achieve farmer contributions through provision of labor and materials to field-level system construction, significant efforts, outside the capabilities and time constraints of PWRS staff, are required. These efforts should not be underestimated; district and subdistrict officials understand these requirements better than national planners. Every project should include comprehensive, long-term, institutionalized WUA development programs. 75. Specific recommendations for improved farmer participation in irrigation developments and management include (i) small scheme design activities (handover [PIK] and village [PID] schemes) should be carried out in a participatory manner at subdistrict level with support from district offices and consultants; (ii) WUA establishment and strengthening activities under the multiagency PTGA training program should be accelerated and routine PTGA training (pembinaan pengairan) financed through the regional development budget; the legal status of WUAs should allow the WUA to undertake contracts with second parties and choose where they obtain their services; and (iii) WUAs should be formed before R&U design activities commence and be encouraged, by the use of community organizers, to participate in system design. A program of tertiary and field-level system construction with farmer participation should be scheduled to be complete within one year of the main system works. 8. Training

76. A human resources development program should be the basis of the training program. Training units need to be incorporated into the structural organization. All staff holding positions (surat keputusan) should be compelled to undertake a fixed number of training days as instructors each year. All irrigation staff attending should have fixed work positions with the respective government organization. A training monitoring system and information system should be established to provide feedback for future courses. O&M implementation and budgetary and organizational policy need to be clear before further training at district and subdistrict levels can be effective. 9. More Efficient Use of Consultants

77. Although the performance of consultants was generally satisfactory, specific aspects should be addressed in future irrigation projects to ensure optimal use of consulting resources. First, weak agency staff will not benefit from day-to-day counterpart strengthening unless staff are assigned full time, given specific tasks, and provided with project funds for subsistence and travel. Second, the role of consultants in construction supervision should be as Engineer, not assistant. This will result in a fairer, transparent execution of contracts. Third, the main task and assisting roles of consultants need to be adequately defined and resources allocated accordingly. Fourth, projects must avoid a high number of consulting contracts that require an inordinate amount of executing agency administration. Lastly, the effectiveness of part F consultants and severe staffing problems in the Telang-Saleh subproject (with personal disputes leading to staff changes) illustrate the need to closely monitor and ensure value for money from both domestic and international consultants. Mechanisms should be incorporated into future projects to ensure that a reasonable level of performance is attained during implementation and recorded on certifiable curriculum vitae of consultants.

22 C. Follow-Up Actions

78. The OEM identified a number of specific, monitorable follow-up actions designed to redress remedial and nonremedial project issues related to additional physical works, O&M procedures of irrigation and drainage schemes, submission of audited financial statements, and future ADB coordination with policy initiatives of the Government and other funding agencies (Appendix 7). The OEM recommends that the Indonesia Resident Mission take the overall responsibility in ensuring that follow-up actions are implemented adequately and in a timely manner.

23 APPENDIXES

Number

Title

Page

Cited on (page, para.) 3, 12 5, 17 6, 23 7, 25 8, 27

1 2 3 4 5

Cost Breakdown by Project Components Summary of Physical Accomplishments Organization Chart for Project Implementation Status of Compliance with Loan Covenants Operational Performance of Rehabilitation and Upgrading of Irrigation and Drainage Schemes Economic Reevaluation Follow-up Actions

24 25 31 32 36

6 7

42 71

11, 41 22, 78

24 COST BREAKDOWN BY PROJECT COMPONENTS ($ million) Appraisal Estimate Foreign Local Total 57.40 5.00 15.40 1.00 0.00 0.00 0.00 95.20 2.40 17.00 4.60 5.50 16.30 20.00 152.60 7.40 32.40 5.60 5.50 16.30 20.00

Appendix 1

Component Civil Works Equipment and Vehicles Consulting Services Training, Demonstration, Monitoring Incremental O&M Administration & Land Acquisitiona Taxes and Duties Interest and Charges ADB Government of Netherlands Refinancing TA Total

Foreign 63.14 6.18 16.47 0.84 0.00 0.00 0.00

Actual Local 81.16 5.08 17.21 2.50 4.92 16.30 12.32

Total 144.30 11.26 33.68 3.34 4.92 16.30 12.32

23.80 0.20 0.20 103.00

0.00 0.00 0.00 161.00

23.80 0.20 0.20 264.00

23.84 0.00 0.17 110.64

0.00 0.00 0.00 139.49

23.84 0.00 0.17 250.13

ADB = Asian Development Bank, O&M = operation and maintenance, TA = technical assistance. a The Operations Evaluation Mission could not confirm actual expenditures specifically related to the Project, as accounts were consolidated with other projects in Central Java, Southeast Sulawesi, and West Sumatra. Source: Project Completion Report and Operations Evaluation Mission estimates.

25 SUMMARY OF PHYSICAL ACCOMPLISHMENTS

Appendix 2, page 1

Table A2.1: Irrigation Development Activities, Appraisal and Actual Targets (ha) Handover < 500 ha No. of Schemes Actual 4 52 39 4 9 56 128 4,430 2,993 412 1,025 4,558

Subproject

Rehab. & Upgrading Appraisal Actual 6,942 70,382 27,377 20,795 22,210 10,000 6,764 7,947 102,035

Efficient O&M Appraisala Actual 7,000 98,000 53,000 18,000 27,000 10,000 7,000 10,000 132,000 100,369 52,417 22,286 25,666 7,168 1,200 3,624 112,361

Yogyakarta:Kulon Progo 7,000 Central Java: 76,200 South Kedu 28,000 Serayu and Ijo-Tipar 22,800 Lower Citanduy 25,200 South Sumatra: Telang-Saleh 10,000 West Sumatra: Batang Anai 7,000 South East Sulawesi: Wawotobi Total 110,000
= not avail7able, O&M = operation and maintenance.
a

The original targets included 7,000 hectares (ha) for Kulon Progo and 7,000 ha for Batang Anai, which were later excluded from the Project. Efficient O&M for these areas were financed under a World Bank- financed project, Irrigation Subsector Project II. Sources: Project Completion Report, Directorate General of Regional Development (DGRD), June 1997; and Project Database, DGRD, November 1996.

Table A2.2: Development of Water Users Associations (status as of November 1996a) No. of Tertiary Units

Subproject

No. of Villages

No. of WUAs

Classification of WUA Undeveloped Handover Developed < 500 ha 40 93 48 4 0 12 0 197 78 447 84 63 68 57 21 818 16 89 11 17 0 0 4 137

Kulon Progo South Kedu Serayu Lower Citanduy Telang-Saleh Batang Anai Wawotobi Total

69 669 143 84 28 18 24 1,035

143 1,636 209 434 573 121 185 3,301

134 629 143 84 68 69 25 1,152

WUA = water users association. a For details for each WUA, refer to Project Database (pp. 11-50), Directorate General of Regional Development (DGRD), 1986. Source: Project Completion Report, DGRD, June 1997.

26
Table A2:3: Summarized Training, by Component Staff of Executing Agencies No. of Total Persons PersonDays 210 324 534 1,152 324 61 157 1,694 241 1,245 80 269 1,835 130 850 132 1,112 270 40 310 5,485 5,762 1,350 928 8,040 36,555 82,234 1,890 819 334 121,832 1,937 7,190 710 1,442 11,279 1,170 8,420 537 10,127 11,598 1,800 355 13,753 165,031
a

Appendix 2, page 2

Province/Component A. D.I. Yogyakarta Irrigation development Agricultural development Coordination and monitoring Subtotal (A) B. Central Java Irrigation development Irrigation service fee Agricultural development Soil and water conservation Coordination and monitoring Subtotal (B) C. South Sumatra Irrigatiom development Agricultural development Women in development Coordination and monitoring Subtotal (C) D. West Sumatra Irrigatiom development Agricultural development Coordination and monitoring Subtotal (D) E. Southeast Sulawesi Irrigation development Agricultural development Coordination and monitoring Subtotal (E) Total

Farmers No. of Total Persons PersonDays 0 2,580 0 2,580 140 4,035 665 0 4,840 1,060 2,000 2,760 0 5,820 141 1,290 0 1,431 0 1,684 0 1,684 16,355 0 51,600 0 51,600 3,078 140 29,245 3,330 0 35,793 11,480 16,000 10,220 0 37,700 846 6,510 0 7,356 0 94,108 0 94,108 226,557

= not available. a For details on the different types of training and duration of each activity, see Project Database (pp. 83-101), Directorate General of Regional Development (DGRD), November 1996. Source: Project Completion Report, DGRD, June 1997.

Table A2.4: Irrigation Service Fee Collections (Rp million) 1993/94 Area (ha) Target Actual 16,044 90.6 81.0 3,399 50.1 52.7 5,203 55.8 30.1 7,277 41.6 32.4 1,441 45.1 4.5 33,364 283.2 200.7 1994/95 Area (ha) 26,397 3,546 5,203 7,277 2,181 44,604 Target 125.9 66.1 60.9 61.3 19.1 333.3 Actual 82.9 58.1 36.6 44.4 5.4 227.4 Area (ha) 33,116 4,566 5,203 7,277 3,261 53,423 1995/96 Target 175.1 84.8 59.2 81.7 27.3 428.1 Actual 121.8 18.0 36.4 64.9 11.0 252.2

Location South Kedu Banyumas Serayu Lower Citanduy Wawotabi Total

Source: Project Completion Report, Directorate General of Regional Development, June 1997.

Table A2.5: Tertiary Development Units, Location and Area Province/District Central Java Purworejo Location Area (ha)

Table A2.6: Civil Works and Other Contracts No. of Amount Contracts ($'000) 121 90,701 45 30,070 85 1,856 38 527 14 89 303 123,243 23 3,965 3 182 41 1,559 4 42 40 437 49 23,733 1 794 10 5,714 1 732 2 2,320 10 463 4 268 13 105 49 3,356 2 15 35 1,194 3 78 2 199 19 83 73 1,383 35 580 3 8 4 71 64 549 100 2,891 893 173,964

Kebumen

Cilacap

Banyumas D.I. Yogyakarta Kulon Progo

Purwodali Banyu Urip Kemiri Kutowinangun Kebumen Petanahan Gombong Kroya Kesugihan Kawungantan Sidareja Kedung Reja Majenang Sumpiuh

100.0 50.0 55.0 52.3 98.7 71.4 53.1 96.0 139.6 64.4 74.0 98.7 59.4 92.2

Nanggulan

107.0

South Sumatra Musi Banyu Asin Saleh Agung Sri Mulyo Margo Rahayu Sumber Mulyo West Sumatra Padang Pariaman Southeast Sulawesi Kendari

8.7 15.8 16.0 16.0

Pasir Lawas

59.2

Asolu Benua

87.0 68.0

Source: Project Completion Report, Volume II, IISP-I, Directorate General of Regional Development, June 1997.

Category 01A : Civil Works (Part A) - Loan 1017-INO 01A : Civil Works (Part A) - Loan 1018-INO 01C : Civil Works (Part C) 01D : Civil Works (Part D) 01F : Civil Works (Part F) Subtotal 02A : Equipment/Vehicles (Part A) 02B : Equipment/Vehicles (Part B) 02C : Equipment/Vehicles (Part C) 02D : Equipment/Vehicles (Part D) 02E : Equipment/Vehicles (Part E) 02F : Equipment/Vehicles (Part F) 03A : Consulting Services (Part A) 03B : Consulting Services (Part B) 03C : Consulting Services (Part C) 03E : Consulting Services (Part E) 03F : Consulting Services (Part F) 04A : Overseas Training (Part A) 04C : Overseas Training (Part C) 04F : Overseas Training (Part F) 06A : Equipment/Vehicles - Local (Part A) 06B : Equipment/Vehicles - Local (Part B) 06C : Equipment/Vehicles - Local (Part C) 06D : Equipment/Vehicles - Local (Part D) 06E : Equipment/Vehicles - Local (Part E) 06F : Equipment/Vehicles - Local (Part F) 08A : Local Training/BME (Part A) 08B : Local Training/BME (Part B) 08C : Local Training/BME (Part C) 08D : Local Training/BME (Part D) 08E : Local Training/BME (Part E) 08F : Local Training/BME (Part F) 09 O&M (Part A) Total
BME = benefit monitoring and evaluation. Source: Asian Development Bank records.

28

Appendix 2, page 4

Table A2.7: Kulon Progo Irrigation Schemes, Major Works of Irrigation Rehabilitation and Upgrading Scope of Work Normalization of main canals Normalization of secondary canals Normalization of tertiary canals Lining of tertiary canals Lining of canals Tunnels Flumes Weirs and appurtenant works Turnout structures Siphons Culverts Bridges
m = meter. Source: Project Benefit Monitoring and Evaluation Review Study, Directorate General of Water Resources Development, December 1996.

Planned 1,742 m 68,226 m 18,141 m 11,396 m 56,181 m 430 m 927 m 5 units 167 units 22 units 189 units 324 units

Actual 1,646 m 31,104 m 22,219 m 13,367 m 81,336 m 1,320 m 1,047 m 5 units 213 units 27 units 232 units 370 units

Table A2.8: Kulon Progo Irrigation Schemes, Major Works of Drainage Rehabilitation and Upgrading Scope of Work Normalization of canals Lining of canals Weirs and appurtent works Flumes Outlet/Inlet structures Siphons Bridges
m = meter. Source: Project Benefit Monitoring and Evaluation Review Study, Directorate General of Water Resources Development, December 1996.

Planned 41,773 m 3,014 m 1 unit 1m 87 units 1 units 42 units

Actual 41,773 m 3,014 m 1 unit 1m 87 units 1 units 42 units

29 Table A2.9 : Major Civil Works of the Rehabilitation and Upgrading of South Kedu Irrigation Schemes Type of Civil Works Rehabilitation of primary and secondary canals Construction of secondary canals Concrete lining: primary and secondary canals Weir rehabilitation/replacement Deepening, widening rivers, and internal drainage Structures: secondary canals Structures: drainage Gates: rivers and drainage Gates: secondary canals
m = meter.

Appendix 2, page 5

Unit m m m units m units units units units

Actual 114,535 8,130 53,439 3 93,970 367 247 12 314

Source: Completion Report, South Kedu Irrigation, Construction Supervision, DHV Consultants and Associated Consultants, Directorate General of Water Resources Development, March 1994.

Table A2.10: Major Civil Works of the Rehabilitation and Upgrading of the Serayu Irrigation Schemes Type of Civil Works Concrete lined canals Earth canals, including side drains Miscellaneous structures Tertiary systems Deepening and widening of river canals (package III/1) Rehabilitation and improvement of main drainage (ljo and Gatel rivers) Rehabilitation and improvement of secondary drainage Construction of new collector drains Deepening and widening of river canals (package III/2) Rehabilitation and improvement of main drainage (Tipar and Upper Tipar rivers) Rehabilitation and improvement of secondary drainage/tributaries Construction of new collector drains' Deepening and widening of river canals (package III/3) Rehabilitation and improvement of rivers (Sabuk, Lancar, Kedungbaya, Sitopong)
m = meter. Source: Completion Report, Serayu Barrage and Ijo Tipar Drainage, Bureau Central d'Etudes pour les Equipements d'Outre-Mer and Associated Consultants, Directorate General of Water Resources Development.

Unit m m units ha m m m m m m m

Actual 34,166 283,716 749 21,903 15,111 16,418 10,996 13,109 3,196 8,484 18,181

30 Table A2.11: Major Civil Works, Planned and Actual

Main Feature New Construction Primary canal Secondary canal Tertiary canal Primary and secondary Concrete lining Flood levee Drainage improvements Tidal levees Inspection roads Rehabilitation Tertiary ha = hectare, m = meter. Planned

Appendix 2, page 6

Actual

7,500 m 62,075 m 160,000 m 61,000 m 59,190 m 109,100 m 55,000 m 28,000 m

7,513 m 54,936 m 152,113 m 62,765 m 67,824 m 98,508 m 67,186 m 29,341 m

23,000 ha

22,000 ha

Source: Completion Report, Part A, Lower Citanduy Irrigation Improvement Project, Directorate General of Water Resources Development, October 1996.

Table A2.12: Major Rehabilitation and Upgrading Civil Works in Telang and Saleh
Whole Area 60,000 ha Appraisal Actual 102 km 70.4 km 6.1 km 18.5 km 7 units 11 units 38 km 5,000 ha 5,000 ha 10,000 ha 10,000 ha Pilot Area 10,000 ha Appraisal Actual

Item R&U navigation/primary canals Survey and designs Reconstruction of existing canals Construction of new canals Reconstruction of flood embarkment R&U of roads and transport Infrastructure Bridges over primary canals Bridges over secondary canals Roads Phase I preparation Design review Surveys and investigations, secondary blocks Detailed designs, secondary blocks Phase II preparation Surveys and investigations, secondary blocks Detailed designs secondary blocks R&U secondary drainage systems Secondary drains Secondary flap gate structures R&U tertiary systems Existing tertiary drains Additional tertiary drains Tertiary stop log structures

71.0 km

20 units 32 units 250 km

15,000 ha 15,000 ha

17,000 ha 17,000 ha 185 km 44 units 185 km 200 km 920 units 110.5 km 14 units 85 km 72 km 312 units

ha = hectare, km = kilometer, R&U = rehabilitation and upgrading. Source: Completion Report, Telang and Saleh Agricultural Development Project, Euroconsult and Associated Consultants, Directorate General of Water Resources Development, June 1997.

ORGANIZATION CHART FOR PROJECT IMPLEMENTATION

GOVERNMENT OF INDONESIA

Ministry of Public Works

Ministry of Agriculture

Ministry of Forestry

Ministry of Home Affairs

Office of the Minister of State for the Role of Women

BAPPENAS

Director General, Water Resources Development

Director General, Food Crops and Horticulture

Director General, Reforestation and Land Rehabilitation

Director General, Regional Development

Director General, Public Administration & Regl Autonomy

National Level

Dir. of Irrigation - I Dir. of Irrigation - II Dir. of Swamps Dir. of Planning and Programming Dir. of Rivers Project Offices: - South Kedu - Serayu - Lower Citanduy - South Sumatra

Dir. Food Crops Agric. Prod. Div. Dir. Food Crops Production Dir. Food Crops Agric. Extension Dir. Planning & Programming Dir. Of Agric. Area Dev.

Directorate Soil Conservation Dir. Reforestation & Regreening Dir. Extension

Directorate Regional Development

Directorate Regional Financea

31

Provincial Level

Regional Office (Kanwil)

Regional Office (Kanwil)

Regional Office (Kanwil)

GOVERNOR

PRIS

PRAS

SLRSC

BAPPEDA I

District Level

Appendix 3

District Irrigation Service

District Agricultural Services

Branch SLRSC

BAPPEDA II

PRAS = provincial agricultural services, PRIS = provincial irrigation services, SLRSC = subcenter for land rehabilitation and soil conservation. project responsibility
a

normal responsibility

coordination

Irrigation service fee will be introduced with assistance from various agencies at provincial and district levels.

STATUS OF COMPLIANCE WITH LOAN COVENANTS

Reference to Loan Document Article IV, Section 4.06(b) Covenant Due Date Status at PCR Status at Evaluation

The Directorate General of Water Resources Development (DGWRD), Directorate General of Public Administration and Regional Autonomy (DGPARA), Directorate General of Food Crops and Horticulture (DGFCH), Directorate General of Reforestation and Land Rehabilitation (DGRLR), and Directorate General of Regional Development (DGRD) to furnish audited accounts not later than nine months after each related fiscal year DGWRD, DGPARA, DGFCH, DGRLR, and DGRD to furnish a quarterly progress report, to be consolidated by DGWRD

31 December every year

Partially complied with. Only DGWRD submitted required audit reports. DGFCH and DGPARA submitted the Annual Fiscal Statement (AFS) for Fiscal Year (FY) 1993/94, 1994/95, and 1995/96 to the Project Completion Review (PCR) Mission in April 1999. A limited number of audit reports from the provinces (not per the executing agency [EA]) have been submitted to the Asian Development Bank (ADB).

Partially complied with delay.

Article IV, Section 4.07(b)

Every quarter

Partially complied with. DGWRD, DGFCH, and DGRD submitted reports prepared by consultants. Completion report received from DGRLR. No consolidated reports since completion of the project coordination and monitoring unit (PCMU) (DGWRD consultants) in May 1995. Complied with. The consultant for part F of the Project prepared and submitted a consolidated PCR for the entire project.

Partially complied with.

Article IV, Section 4.07(c)

DGWRD, DGPARA, DGFCH, DGRLR, and DGRD to furnish a PCR

Three months after completion of the Project

Complied with.

Schedule 5, para. 3

Establishment and/or strengthening of a PCMU within DGWRD, DGFCH, and DGRLR Reassignment and/or recruitment of additional staff, as required, in each concerned Regional Development Planning Agency (BAPPEDA) Each provincial irrigation service (PRIS) to designate a project manager

10 November 1990

Complied with. PCMU was active at DGWRD as a result of consultants involvement. Partially complied with. Provincial offices had difficulty in hiring additional staff.

Complied with.

Schedule 5, para.5

During project implementation

Partially complied with delay. (Incomplete data)

Schedule 5, para. 7(a)

Upon approval of the state development budget for FY1990/91

Complied with.

Complied with.

Reference to Loan Document Schedule 5, para. 7

Covenant

Due Date

Status at PCR

Status at Evaluation

Reassignment and/or recruitment of additional staff, as required, in each concerned PRIS, district, and subdistrict irrigation service Strengthening of South Kedu Water Operations Center (WOC) and incorporation of Central Java PRIS

During project implementation

Partially complied with. Provincial offices had difficulty in hiring additional staff.

Partially complied with delay.

Schedule 5, para. 8

10 Aug 1992

Partially complied with. WOC installed computer simulation model, but data were provided 2-4 weeks late by Cabang and Ranting Dinas. WOC is under control of Wadaslintang Project Office at the reservoir site. Complied with.

Partially complied during the project period. WOC is no longer operational.

Schedule 5, para. 10

Establishment of a project management unit by the provincial agricultural service in each concerned province. Reassignment and/or recruitment of additional staff, as required, by each provincial agricultural service in the concerned province Selection and processing of subproject

10 Nov 1990

Complied with.

Schedule 5, paras. 10 and 13

During project implementation

Partially complied with. Shortages were apparent in West and South Sumatra.

Partially complied with delay. (incomplete data)

Schedule 5, para. 14

In accordance with criteria and procedures agreed upon

Complied with.

Substantially complied, however, technical and economic feasibility of some subprojects appear questionable. Partially complied with delay.

Schedule 5, para. 17

Issuance of formal certificate of landownership to farmers in Telang and Saleh core subproject and Southeast Sulawesi subproject Issuance of binding statement agreeing to transfer ownership of land in the extension area of the Lower Citanduy core subproject to the cultivating farmers and effecting such transfer Formulation of a comprehensive training program

Prior to completion of civil works

Partially complied with. Assistance required from all concerned district level agencies

Schedule 5, para. 18

Prior to commencing implementation in extension area; prior to completion of civil works

Partially complied with. Loan was amended in 1995 to allow a longer period to transfer ownership based on experience under Loan 479-INO: Lower Citanduy Irrigation Project.

Not complied with. Farmers in the extension area are still without titles after more than 10 years.

Schedule 5, para. 20

10 Aug 1991

Complied with. DGWRD, DGFCH, and DGRD submitted comprehensive training programs to ADB. Complied with. Schemes (over 112,361 ha) were introduced in the EOM program

Complied with delay.

Schedule 5, para. 22(b)

Introduction of efficient operation and maintenance (EOM)

Upon completion of civil works

Complied with.

Reference to Loan Document Schedule 5, para. 24(a)

Covenant

Due Date

Status at PCR

Status at Evaluation

Transfer of operation and maintenance (O&M) responsibility of main system from central Government to concerned PRIS Transfer of Sidareja-Cihaur primary and secondary irrigation facilities in Lower Citanduy core subproject to Central Java PRIS Transfer of Wadaslintang and Sempor reservoirs and primary canals under South Kedu core subproject to Central Java PRIS upon incorporation of the WOC Transfer of subprojects with areas less than 500 ha to water users associations (WUAs) Maintenance of FY1989/90 level of O&M funding on all public irrigation schemes in project provinces Increase in level of O&M funding on all subprojects where efficient O&M has been introduced Introduction of irrigation service fee (ISF) in the project area with a view towards full cost recovery of O&M by FY1999/00. Improve revenue performance of PBB (land and building tax) through introduction of revised PBB rates

Upon completion of civil works

Partially complied with. Three out of four main schemes have been officially turned over. Serayu has not been officially transferred. Complied with. EOM is ongoing by PRIS Central Java. Rehabilitation and upgrading is controlled by DGWRD.

Complied with delay. ADB agreed that Serayu barrage would remain under the responsibility of the central authority. Complied with. (note: PRIS is now provincial water resources service).

Schedule 5, para. 24(a)(i)

10 Feb 1991

Schedule 5, Para. 24(a)(ii)

10 Aug 1992

Partially complied with. Reservoirs will not be turned over to PRIS. Main systems are under PRIS Central Java and have entered the EOM program.

Complied with. During implementation ADB agreed that reservoirs would remain under the responsibility of the central authority.

Schedule 5, para. 24(b)

Upon completion of civil works

Complied with. 4,430 have been turned over in Central Java.

Complied with.

Schedule 5, para. 25

FY1990/91 onward

Partially complied with. O&M funding has been inadequate.

Not complied. Shortfalls in O&M expenditures have been substantial during and after the project period. Not complied. Shortfalls in O&M expenditures have been substantial during and after the project period. Substantially not complied with. ISF assessment and collection performance has been ineffective.

Schedule 5, para. 26

FY1990/91 onward

Partially complied with. O&M funding has been inadequate.

Schedule 5, para. 28

Within one year after the introduction of EOM

Partially complied with. Arrangements for collection of service fees not introduced in Batang Anai and Telang-Saleh.

Schedule 5, para. 29

In parallel with implementation of subprojects

Complied with. The improvement of PBB collection is not part of the Project.

Complied with.

Schedule 5, para. 30

Simplify and rationalize procedures for funding irrigation O&M

FY1993/94 onward

Complied with. In Central Java, system of rating and monitoring condition of irrigation and drainage schemes have been simplified and used.

Not substantially complied with. EOM funding on a project basis was introduced. No long-term sustainable needs-based budget system was implemented. O&M funding is not linked to a monitoring and evaluation system.

Reference to Loan Document Schedule 5, para. 31

Covenant

Due Date

Status at PCR

Status at Evaluation

Establish or reactivate provincial and district irrigation committees

10 Feb 1991

Complied with.

Complied with. However, intended involvement of committees in system management was not achieved. Substantially not complied. Majority of WUAs in the Project areas have not achieved full viability as per LA. Complied with.

Schedulel5, para. 32

Establishment of viable WUAs

During project implementation

Partially complied with. This is an ongoing program. WUAs are in various stages of development in the subprojects. Complied with. PME action plan approved.

Schedule 5, para. 34

Establishment of a project monitoring and evaluation (PME) unit in each of the provinces concerned Preparation of benefit monitoring and evaluation review study Submission of annual summary of PME reports to ADB.

31 Dec 1990

Schedule 5, para. 34 Schedule 5, para. 34

Upon completion of the Project For a period of five years after project completion Upon introduction of EOM

Complied with. Benefit monitoring and evaluation review study completed. Not yet due.

Complied with.

Partially complied. PME reports have not been submitted to ADB since project completion. Complied with.

Schedule 5, para. 34

Preparation of PME reports for each subproject

Complied with. PME reports prepared in Central Java and submitted to DGWRD

36

Appendix 5, page 1

OPERATIONAL PERFORMANCE OF REHABILITATION AND UPGRADING OF IRRIGATION AND DRAINAGE SCHEMES A. Kulon Progo and Sermo Dam (Joyakarta)

1. The Kulon Progo subproject consisted of rehabilitation and upgrading (R&U) (7,984 hectares [ha]) of the Opak-Serang Irrigation System and construction of the Sermo Dam. The actual irrigated area is estimated at 6,942 ha, about 600 ha more than the future without-project condition. Average paddy yields have increased by about 10 percent from 5.5 to 6.0 metric tons (t)/ha. Cropping intensity has significantly improved by about 33 percentfrom 155 percent to 200 percent. These improvements have resulted in an annual incremental production of about 27,000 t of paddy. The Operations Evaluation Mission (OEM) estimates are consistent with the project completion report (PCR) cropping intensities but slightly lower than PCR yield estimates (6.4 t/ha). 2. Construction quality for R&U was generally very good. The subproject area is currently being used as a pilot project for water users association (WUA) strengthening financed by the World Bank. WUAs and federations of WUAs are involved in participatory irrigation system development. Preparatory operation and maintenance (O&M) activities were carried out under the Project. O&M implementation to date has been underfunded. The increased beneficiary involvement in system management requires intensification and further technical support, particularly related to optimum cropping patterns and water management of Sermo Dam and drainage systems. Drainage canals in the lower end of the system were poorly maintained. The Asian Development Bank (ADB)-funded South Java Flood Control (SJFC) Project1 is addressing some of the flooding constraints not ameliorated under the Project in the lower reaches of the subproject area. Flooding and drainage problems currently affect about 1,000 ha. 3. Sermo Dam, a new 58-meter (m) high dam constructed under the Project, replaced an existing weir and is designed to deliver about 4 cubic meters (m3)/second (sec) of supplemental water primarily in the dry season. The dam, in general, is well maintained with active routine reading of dam instrumentation and a sediment monitoring program. Development of local roads, which would direct traffic away from the dam crest and improve access to 750 families, has not been implemented. A small water supply for Wates is now taken from the reservoir. Limited local community interviews suggested that resettlers to Bengkulu may not have received full compensation in accordance with promised allocations. B. South Kedu (Central Java)

4. R&U covered nine schemes in 27,377 ha (appraisal 28,000 ha) with efficient operation and maintenance (EOM) over 52,417 ha (target 53,000 ha), and included a new, wellconstructed Boro Weir, which replaced an old gabion structure, serving 5,127 ha. Average paddy yields increased by about 5 percent from 5.8 t/ha in the future without project condition (5.4 t/ha pre-Project) to 6.0 t/ha at the end of the Project. Cropping intensity has slightly improved from 190 percent to 200 percent. These improvements have resulted in an annual incremental production of about 27,000 t of paddy. OEM estimates are consistent with both PCR and appraisal estimates. 5. Construction quality was satisfactory. The irrigation schemes in the South Kedu area have been included in a series of R&U, special (deferred) maintenance, and EOM programs in
1

Loan 1479-INO: South Java Flood Control Sector Project, for $103 million, approved on 7 November 1996.

37

Appendix 5, page 2

the past. Project activities were piecemeal and focused on canal normalization and lining. Tertiary works were identified during EOM activities as inadequate, but were classified as a farmer responsibility and subsequently not developed. Key drainage works along a number of rivers (including Wawar) were either canceled (lack of funds, inadequate time) or excluded from the Project during the design process. Significant areas in the lower reaches are subject to frequent inundation. The SJFC project is addressing some of the severe drainage and flood control issues. 6. The main canals picking up flows sourced from the Wadaslintang reservoir are operated at 2030 percent below capacity because of canal embankment instability. The South Kedu area operates in the dry season in acute water shortage. Farmers augment surface water irrigation flows, particularly in downstream coastal areas, through the extensive use of shallow groundwater by manual lifting or small portable pumps. 7. The Wadaslintang and Sempor Dams Water Operational Center, strengthened with office facilities, equipment, training, and consulting services under the Project, no longer exists. Instead, dam operations are carried out following manual operational curves based on requests from downstream managers. 8. WUAs within the Boro Irrigation System, under the ongoing World Bank-supported Java Irrigation Improvement and Water Resources Management Project, have recently participated in system planning and design activities in fiscal year (FY) 2000 and have constructed R&U works under a direct contract award system. Using rehabilitation funds to stimulate WUAs to participate in system development has some merits. However, the major gains in sustainable utilization of the existing facilities will be from improved WUA participation in routine O&M. Irrigation committee implementation is less than participatory; government institutional management structures, despite recent reforms, remain overly centralized, complex, and do not include adequate beneficiary representation. Government-managed irrigation service fee (ISF) collection for main systems has been low. However, routine contributions by WUAs of funds to contribute to tertiary-level activities have been seven to nine times higher and demonstrate a willingness and ability of farmers to participate in O&M funding. 9. Further attention to providing adequate institutional arrangements to allow improved system management is required. Drainage, flood, and drain access need development under the ADB-supported SJFC, and a participatory tertiary development study should be undertaken to ascertain the most appropriate tertiary system development model in the highly populated South Kedu area. C. Serayu and Ijo-Tipar Irrigation and Drainage Schemes

10. The Serayu Barrage replaces the existing Gambarsari (15,547 ha) and Pasanggrahan (3,633 ha) pumped schemes and includes an extension of 4,700 ha, giving an appraised area of 22,800 ha. The irrigated area has increased from about 17,890 ha pre-Project to 21,030 ha. Average paddy yields have increased by about 5 percent from 5.7 t/ha in the future withoutproject condition (5.4 t/ha pre-Project) to 6.0 t/ha. Cropping intensity has improved from 150 percent to 175 percent. These improvements have resulted in an annual incremental production of about 57,400 t of paddy. OEM estimates are consistent with the PCR, but lower than appraisal (11 percent average yield increase and final cropping intensity of 200 percent).

38

Appendix 5, page 3

11. The barrage was complete in 1996 and is in good condition with O&M under a centrally funded special budget. Minor works are required for measurement and control systems, and upgrading existing personal computers and providing a backup system for operational software is considered essential. The size and technical complexity of the barrage warrant introduction of a routine inspection mechanism using technical competent staff. Late completion of the barrage is the reason given for not adequately testing and commissioning the canal system despite pumping station availability. When the tests were subsequently taken, a number of new canal sections collapsed. 12. A number of major technical design/construction discrepancies where found during the OEMs site visit, including (i) foot bridges on the Cilacap main canal that had inverts below the full supply water level of the canal; (ii) areas of instability on embanked canals; and (iii) low main canal offtake construction (1.5 m below ground level at canal marker BS24), effectively cutting off all downstream supplies, to more than 1,500 ha. 13. Canal system maintenance was fair along the Serayu canal but the Cilacap canal discharge was reduced to 5060 percent of capacity due to heavy weed growth and sedimentation. Drainage systems were poorly maintained and a high percentage of gate flaps were either missing or not functioning. Tertiary development was, in general, unsuccessful, lacking participation and farmer agreement on infrastructure requirements. Major drainage works affecting about 5,000 ha were deferred to SJFC due to insufficient budget. 14. The new water supply link to the Cilacap town waterworks is ongoing and scheduled for completion in 2002. 15. Current institutional policy changes concerning water resources and decentralization initiatives have further reduced the budget for O&M in the subproject area. WUAs are partially active and have a dual fee collection system, historically contributing up to 100200 kilograms (kg)/harvest to system (generally tertiary) O&M. D. Lower Citanduy Irrigation (Central Java)

16. The Lower Citanduy subproject comprises R&U over the 20,040 ha Sidareja-Cihaur irrigation (including 2,170 ha of new extension). Tidal levees, drainage works, and initial dredging of 1.3 million m3 of sediments from the Segara Anakan lagoon were also included under part A. As a result of the Project, the irrigated area has increased from about 17,870 ha pre-Project to about 19,160 ha. Average paddy yields have increased by about 8 percent from 5.8 t/ha in the future without-project condition (5.4 t/ha pre-Project) to 6.2 t/ha. Cropping intensity has improved by about 11 percent, from 180 to 200 percent. These gains have increased annual paddy production by an estimated 47,350 t. OEM estimates are consistent with the PCR (appraisal estimates not stated for this core subproject). 17. Construction quality was generally good. Irrigation R&U works consisted mainly of canal upgrading by lining programs and developing the tertiary system. Tertiary canals in flat areas used an innovative raised concrete canal with low land usage, which was well accepted by farmers. Tertiary canal development in steeper upper areas was less successful. Secondary canal R&U provided an unusually high density main system conveyance network. Maintenance of main canal systems is poor; often canal lining was difficult to see and some secondary canals in extension areas were almost undetectable.

39

Appendix 5, page 4

18. Canal and drainage works in extension areas were delayed partly because of protracted procedures in transferring landownership/use titles between government-owned bodies. Farmers in these areas still lack titles. Settlement into these areas has been slow and improved access roads and rural infrastructure are needed to support exiting communities. In general drainage and flood defense works followed old design studies. Postconstruction sedimentation of the Cimeneng floodway (1.01.5 m) illustrates the speed of change in the Segara Anakan environment and the importance of a comprehensive holistic approach to development (including watershed protection). Significant drainage and flood control works remain unfinished. An ADB-funded watershed catchment protection implementation study proposed major institutional and technical interventions in the lower Citanduy subproject watersheds. These works have not, to date, been implemented by government funding or ADBs Segara Anakan and SJFC project. Both these projects are currently active in the project area. 19. E. O&M funds for district offices were not included in the 2001 budget. Telang-Saleh (South Sumatra)

20. The Telang-Saleh subproject, located in the extensive coastal swamp plains in South Sumatra, consisted of intensive rehabilitation and institutional support on a 10,000 ha pilot study area (phase I). The objective was to determine appropriate development models for the total drainage area of about 60,000 ha: (i) Telang I, 26,680 ha; (ii) Telang II, 13,800 ha; and (iii) Saleh, 19,090 ha. Project interventions have resulted in little sustainable improvement. About 65 percent of the pilot area was developed for crop production through an extensive drainagewater management system. Overall cropping intensities for the subproject remain at the preproject level of about 80 percent. Average paddy yields in the pilot area have increased by an estimated 40 percent, but started from a very low base and are still below 3.0 t/ha. Annual incremental paddy production is estimated at 10,600 t. OEM estimates on cropping intensity are consistent with the PCR but lower than appraisal (92 percent). For yields, OEM estimates are consistent with appraisal but lower than the PCR (average of 60 percent yield increase). 21. Implementation was delayed due to cancellation of the Government of Netherlands $8.0 million equivalent bilateral grant, and intense internal government debate concerning appropriate techniques for swamp-water drainage management. 22. The PCR summarizes project outputs and raises important questions regarding continued research, phase II development, and risks to sustainability of phase I infrastructure due to the absence of clear provisions and organizational arrangements for O&M. The OEM noted that many of these concerns have not been addressed. Continued research in the swamp coastal plains is acknowledged as important by local administration and academic institutions. Ongoing research programs continue to add to the understanding of the complex environmental regime in the coastal lowland areas. Notwithstanding the general interest, project-based research initiatives instigated in Telang-Saleh phase I have not continued. Many farmers have left the area, leaving a low density of farmers practicing extensive crop production. Extension services at the field level by agriculture and public works O&M institutions were unsatisfactory. No budget for O&M activities, including staff salaries of day workers, was allocated in FY2001, despite fiscal decentralization that resulted in large local availability of funds. 23. All control gate structures visited were nonfunctional due to stolen or broken parts. Water management in any form cannot be practiced due to poor infrastructure maintenance. Most problems are simple and relatively cheap to resolve; original construction quality was good. Ownership of existing facilities and management of research, beneficiary participation,

40

Appendix 5, page 5

future infrastructure developments, and O&M needs to be addressed at provincial and district levels with some urgency. 24. Rural infrastructure improvements (roads, bridges, and water supply) carried out under the Project were considered very valuable by local communities. 25. Poor coordination and inefficient use of consultants in South Sumatra resulted in less than optimum design and inefficient implementation. 26. Including Telang-Saleh in a long-term swamp development project rather than a sectoral irrigation subproject, would have been more appropriate. F. Batang Anai (West Sumatra)

27. The Batang Anai subproject, West Sumatra, includes headworks, main system, and partial tertiary development of phase I (6,740 ha) of the total scheme design area of 13,604 ha. The current irrigated area is estimated at 4,500 ha, compared with 3,200 ha at the start of the Project. Average paddy yields are about 40 percent higher than future without-project yields (4.9 versus 3.5 t/ha). Overall cropping intensity for the phase I area has increased by about 30 percent to 130 percent (173 percent in fully irrigated areas). Annual incremental production is about 19,000 t of paddy. OEM estimates are consistent with PCR yield and cropping intensities, but the PCR indicates an irrigated area of 6,520 ha. 28. An existing gabion weir was replaced with an expensive masonry structure; main and secondary canals are lined and provided with technical control structures. Construction quality is generally good. 29. The lower part of the project area remains under the jurisdiction of a swamp project and drains are currently being reexcavated to allow clear drainage flows to the sea. The Batang Anai Project has not been transferred to the provincial government. Land is cropped close to populated areas but inadequate access to peat areas, lack of farmers, and poor soil discourage agricultural activities over much of the potential command area. Project and supplementary postproject land development contracts have cleared a portion of the shallow peats; secondary swamp forest remains in deep peat areas. Land use for agricultural production decreases rapidly at a distance of about 500 m from villages in this area.2 30. Subdistrict staff have had extensive technical training in systems management. Budgets for system maintenance have historically been inadequate (averaging 2540 percent of routine needs) and, in the current fiscal year, under decentralization, no system maintenance budget has been allocated. 31. The phase II area, where soils are considered more suitable for flooded rice agriculture, was visited. Exceptionally high rainfall (annual average of 4,000 mm) in the subproject area minimizes the need for supplementary irrigation. Careful review of the soil type, land use, and
2

The Directorate General of Water Resources Development (DGWRD) and ADB, following a lengthy process of redrafting the summary subproject report (SSR), accepted the subproject. Major problems relating to soil type and farmer availability, although known constraints to irrigation development in the area, were omitted from the final SSR. Subsequent to SSR approval, a special soils study by the project consultants produced a soil map of the proposed area reconfirming concerns by classifying deep peat soils (16 m) as unsuitable or marginally suitable following treatment. Such soils cover some 80 percent of the phase I area.

41

Appendix 5, page 6

incremental benefits from irrigation is needed before any investment in the phase II area can be considered. G. Wawotobi (South East Sulawesi)

32. Seven irrigation schemes (7,947 ha) were upgraded following approval of the summary subproject reports. The Wawotobi schemes are typical of off-Java systems, where R&U work is predominantly upgrading: three new weirs were constructed and three others had major upgrades. The irrigated command area has increased by about 1,400 ha (21 percent) over the preproject condition. Paddy yields have improved from 4.1 t/ha in the future without-project condition (3.8 t/ha pre-Project) to 5.1 t/ha (25 percent gain). Cropping intensity has improved from 155 to 175 percent. The gains in command area, yield, and cropping intensity have increased annual paddy production by an estimated 29,300 t. OEM and PCR estimates are consistent, with the exception of higher yields estimated by the PCR. 33. All schemes are located in the Kendari district where the Project has contributed significantly to overall regional development as a result of new irrigation, drainage flood protection infrastructure, and access roads. WUAs are partly developed where irrigation is predominantly practiced by Java and Bali transmigrants; local indigenous farmers tend to own and farm tree crops in addition to paddy land. 34. Construction quality was above average, particularly taking into consideration the remote location. Designs were found to be expensive and not always appropriate.3 Summary subproject report water-balance sheets showed unacceptable water shortages of 3050 percent in the Walay and Ameroro schemes, indicating that design areas had been overestimated. Expensive spill weirs, separate from existing weirs (Maluku scheme), could have been simple gabion structures or incorporated into the existing weir structure. Cropping is less intensive in downstream areas partly due to poor canal maintenance (Walay scheme) but also affected by poor water availability/management and low population density. Local government institutions are not adequately developed for participatory development.

The Asoro Weir intake gates were poorly positioned on the inside bend on a heavily silted river, the desilting basin flushing channel is high, and inadequate flushing allows large amounts of sediment to enter the main canal.

42 ECONOMIC REEVALUATION A. Methodology and Assumptions

Appendix 6, page 1

1. The economic viability of the Project was reassessed applying the same methodology used in the appraisal report and project completion report (PCR). The basic methodology for the economic analysis follows the approach given in the Asian Development Bank (ADB) Guidelines for the Economic Analysis of Projects. The rehabilitation and upgrading of irrigation and drainage facilities, supported by tertiary development units (TDUs), and capacity building for irrigation agencies and water users associations (WUAs) was expected to lead to higher cropping intensities and yields, and resulting increases in farm income. Economic internal rates of return (EIRRs) were calculated for each of the seven subproject irrigation areas and the overall Project. The analysis is based on production data obtained during the Operations Evaluation Mission (OEM) from government sources, backed up by interviews with farmers and government officials. Data from PCRs prepared by consultants for the Government and other sources have also been used. 2. The EIRR calculations are based on the following major assumptions: (i) The economic life of the project irrigation and drainage facilities is assumed to be 30 years starting from 1991. All taxes and other transfer payments are removed from the financial costs and benefit streams. The financial benefits and costs are converted to economic costs and benefits using a standard conversion factor of 0.9 for nontraded items. A shadow wage rate factor of 0.81 is applied to reflect conditions of unemployment and underemployment in most rural labor markets at the world price level. Past and projected rice (import parity) and fertilizer (export parity for urea, import parity for others) prices are based on April 2000 World Bank commodity price projections, adjusted for quality differences, transport, handling, marketing, and other costs to determine economic farmgate prices (Tables A6.1-A6.4). Other current costs and benefits are converted to 2001 prices by applying the World Banks manufacturers unit value index for the traded components and gross domestic product deflator for all local costs. Project investment costs comprise actual financial costs for all civil works, design and supervision, equipment and vehicles, training, consulting services, land development, and project management (Table A6.5).

(ii)

(iii)

(iv)

(v)

(vi)

B.

Estimation of Project Benefits

3. The quantifiable benefits were estimated as the difference in agricultural production with and without project interventions, adjusted for incremental costs of production. Projected estimates for future yields and cropping intensities assumes a marginal deterioration in operation and maintenance (O&M) based on (i) current physical condition of irrigation systems observed by the efficient operation and maintenance (EOM); (ii) the expected continued gradual degradation of watersheds and their adverse consequences on system O&M; (iii) persistent

43

Appendix 6, page 2

flooding and drainage problems; (iv) the assumption of no real increase in O&M funding; and (v) only marginal improvements in irrigation service fee collections and overall effectiveness of WUAs. 4. For subprojects located in Java, additional investments have been made after the close of the Project by the Government from its own funds as well as donors. These investments generally include remedial civil works for irrigation schemes financed by the Government, plus additional ADB-supported investments in major drainage and flood control (still ongoing), and World Bank support for WUA development and river basin planning (still ongoing). The economic evaluation of the Project excludes any estimation of benefits and costs from these additional interventions. 5. The combined impact of project interventions currently produces an estimated incremental increase in paddy production of about 142,000 tons (t) per annum in the four core subprojects and 217,000 t for the Project as a whole as compared with the future withoutproject situation. This compares with the appraisal and PCR estimates of 190,000 t and 146,000 t, respectively for the four core subprojects, and 230,000 and 260,000 t, respectively, for the Project as a whole. 6. Consistent with the methodology used in the PCR, the OEM analysis did not attempt to quantify the benefits and costs of any possible incremental production of soybeans, peanuts, coconuts, or cassava. These crops are primarily grown under rainfed conditions, and the area devoted to these crops is relatively small. Production of these crops is also not materially affected by project investments in the future with-project situation compared with the future without. Also, though identified in the appraisal, separate incremental production of these crops is not stated. C. Economic Internal Rates of Return

7. The economic analysis was carried out for each of the seven subprojects and for all subprojects combined (Tables A6.6A6.13). EIRRs are lower than those estimated at appraisal and the PCR, in particular, the EIRRs for the noncore subprojects for which no appraisal estimates were made as these subprojects were formally approved later during implementation. EIRR comparisons are indicated as follows: (i) South Kedu (12.6 percent versus appraisal estimate of 19.8 percent and PCR estimate of 14.0 percent); (ii) Serayu (8.4 percent versus appraisal estimate of 15.4 percent and PCR estimate of 10.5 percent); (iii) Lower Citanduy (11.8 percent versus appraisal estimate of 17.3 percent and PCR estimate of 14.7 percent); (iv) Telang and Saleh (4.0 percent versus appraisal estimate of 11.6 percent and PCR estimate of 10.8 percent); (v) Kulon Progo/Sermo dam (7.5 percent versus PCR estimate of 15.1 percent); (vi) Batang Anai (3.1 percent versus PCR estimate of 13.7 percent); and (vii) Wawatobi (9.0 percent versus PCR estimate of 16.0 percent). 8. The difference in the overall viability compared with the analysis in the appraisal and PCR is explained by differences in the estimates of incremental increases in yields and cropping intensities (lower OEM estimates), incremental production costs (higher OEM estimates), lower achievements on land development, and higher percentage of command areas that do not receive adequate irrigation supplies and/or remain vulnerable to frequent flooding and poor drainage. Investment cost per hectare (ha) of actual command area was another critical factor directly linked to subproject viability. South Kedu had the highest EIRR and the lowest investment cost per ha (about $600). Batang Anai had the lowest EIRR and the highest cost (about $6,000)the high cost resulted from the large new weir constructed to serve a much

44

Appendix 6, page 3

larger area (13,000 ha) than was planned under the Project (6,520 ha). The remaining area was expected to be developed at a later stage. In addition, about half of the 6,520 ha area under the subproject was a mixture of rainfed paddy land (2,020 ha) and noncropped land (1,300 ha). Due to the abundance of peat soil that is not well-suited for paddy cultivation in these areas, little land development occurred, and rainfed areas required entire new canal systems rather than rehabilitation and upgrading. In total, only an estimated 4,500 ha are currently irrigated. D. Sensitivity Analysis

9. Given the uncertainty and lack of project data and information, it was considered important to analyze the sustainability of the Project under different assumptions. Sensitivity analyses were, therefore, carried out for unfavorable changes in yields, cropping intensities, crop prices, and production costs (Table A6.14). The analysis indicates that relatively modest changes in yields and/or cropping intensities (either positive or negative) would have a significant impact on economic efficiency. Growth in yields and production on Java during the 1990s has been essentially flat and the Governments lack of progress in reversing watershed degradation or improving O&M means this trend is unlikely to improve. Declining trends in the paddy-fertilizer price ratio reflect changes in production costs and crop prices, and may also adversely impact yields as farmers either maintain or reduce input levels. During 19921997, total fertilizer use on food crops in Indonesia dropped by about 21 percent.

Table A6.1: Import Parity Paddy Price at Farmgate (Expressed in 2001 Constant Prices) Item
a Milled rice, 5% broken, FOB Bangkok in 1990 constant prices

Unit

1994

1995

1996

1997

1998

1999

2000

2001

242.80 269.20 297.30 280.50 291.90 239.90 235.50 239.00 $/ton 264.17 292.89 323.46 305.18 317.59 261.01 256.22 260.03 $/ton 39.62 40.00 43.93 40.00 48.52 40.00 45.78 40.00 47.64 40.00 39.15 40.00 38.43 40.00 39.00 40.00 $/ton

MUV multiplier 1990 to 2001 constant, 1.088 Milled rice, 5% broken, FOB Bangkok in 2001 constant prices
b less quality adjustment for Project rice output, 15%

Freight and insurance to Cilacap, Padang, Palembang Ports

CIF, bagged milled rice at major Indonesian ports of destination Financial Prices in 2001 constant terms CIF, bagged milled rice at major Indonesian ports of destination Port handling, storage, and transport charges to wholesalers, 5% Import parity wholesale price less traders' margins, 10% Ex-mill price
d Conversion to Paddy price at mill gate, 63% c

$/ton 264.54 288.96 314.94 299.41 309.95 261.86 257.79 261.03

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

2,917 146 3,062 195 306 2,561 1,613 119 54 1,440

3,186 159 3,345 195 335 2,815 1,774 119 54 1,600

3,472 174 3,646 195 365 3,086 1,944 119 54 1,771

3,301 165 3,466 195 347 2,924 1,842 119 54 1,669

3,417 171 3,588 195 359 3,034 1,911 119 54 1,738

2,887 144 3,031 195 303 2,533 1,596 119 54 1,422

2,842 142 2,984 195 298 2,491 1,569 119 54 1,396

2,878 144 3,022 195 302 2,524 1,590 119 54 1,417

less estimated transport costs - from rice mills to wholesalers

less milling costs less estimated transport costs from farms to mills Import parity financial farmgate price Economic Prices in 2001 constant terms CIF, bagged milled rice at major Indonesian ports of destination Port handling, storage, and transport charges to wholesalers Import parity wholesale price less transport costs - from rice mills to wholesalers less traders' margins Ex-mill price Conversion to paddy price at mill gate less milling cost less transport from farms to mills Import parity economic farmgate price
a b c d

45

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

2,917 131 3,048 176 276 2,597 1,636 107 49 1,480

3,186 143 3,329 176 301 2,852 1,797 107 49 1,641

3,472 156 3,628 176 328 3,125 1,969 107 49 1,812

3,301 149 3,449 176 312 2,962 1,866 107 49 1,710

3,417 154 3,571 176 323 3,072 1,936 107 49 1,779

2,887 130 3,017 176 273 2,568 1,618 107 49 1,462

2,842 128 2,970 176 269 2,526 1,591 107 49 1,435

2,878 130 3,007 176 272 2,560 1,613 107 49 1,456

Appendix 6, page 4

CIF = cost, insurance freight; FOB = free on board; kg = kilogram; MUV = manufacturing unit value. Rice (Thai), 5 percent broken, milled, FOB Bangkok; Source: World Bank. 2000. Commodity Markets and the Developing Countries . Based on average price difference between Thai 5 percent and 25 percent brokens (1998-2000 quarterly data), World Bank, May 2000. Freight and insurance to major Indonesian ports nearest project sites. Converted to paddy equivalent at 63 percent of milled rice, equivalent to the Indonesian term GKG: Gabah Kering Giling . World Bank. 1999. Indonesia:Essays on Agricultural Institutions and Policy . Source: Project Completion Report and Operations Evaluation Mission estimates.

Table A6.1 (continued) Item

a Milled rice, 5% broken, FOB Bangkok in 1990 constant prices

Unit

2002

2003

2004

2005

2006

2007

2008

2009

241.90 249.13 256.37 263.60 261.96 260.32 258.68 257.04 $/ton 263.19 271.06 278.93 286.80 285.01 283.23 281.44 279.66 $/ton
c

MUV multiplier 1990 to 2001 constant, 1.088 Milled rice, 5 % broken, FOB Bangkok in 2001 constant prices
b less quality adjustment for project rice output, 15%

39.48 40.00

40.66 40.00

41.84 40.00

43.02 40.00

42.75 40.00

42.48 40.00

42.22 40.00

41.95 40.00

Freight and insurance to Cilacap, Padang, or Palembang Ports

$/ton

CIF, bagged milled rice at major Indonesian ports of destination Financial Prices in 2001 constant terms CIF, bagged milled rice at major Indonesian ports of destination Port handling, storage, and transport charges to wholesalers, 5% Import parity wholesale price less traders' margins, 10% Ex-mill price
d Conversion to paddy price at mill gate, 63% c

$/ton 263.71 270.40 277.09 283.78 282.26 280.74 279.23 277.71

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

2,907 145 3,053 195 305 2,552 1,608 119 54 1,434

2,981 149 3,130 195 313 2,622 1,652 119 54 1,478

3,055 153 3,208 195 321 2,692 1,696 119 54 1,522

3,129 156 3,285 195 329 2,761 1,740 119 54 1,566

3,112 156 3,268 195 327 2,746 1,730 119 54 1,556

3,095 155 3,250 195 325 2,730 1,720 119 54 1,546

3,078 154 3,232 195 323 2,714 1,710 119 54 1,536

3,062 153 3,215 195 321 2,698 1,700 119 54 1,526

less estimated transport costs - from rice mills to wholesalers

less milling costs less estimated transport costs from farms to mills Import parity financial farmgate price Economic Prices in 2001 constant terms CIF, bagged milled rice at major Indonesian ports of destination Port handling, storage, and transport charges to wholesalers Import parity wholesale price less transport costs - from rice mills to wholesalers less traders' margins Ex-mill price Conversion to paddy price at mill gate less milling cost less transport from farms to mills Import parity economic farmgate price
a b c d

46

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

2,907 131 3,038 176 275 2,588 1,630 107 49 1,474

2,981 134 3,115 176 282 2,658 1,674 107 49 1,518

3,055 137 3,192 176 289 2,728 1,719 107 49 1,563

3,129 141 3,269 176 296 2,798 1,763 107 49 1,607

3,112 140 3,252 176 294 2,782 1,753 107 49 1,597

3,095 139 3,234 176 292 2,766 1,743 107 49 1,587

3,078 139 3,217 176 291 2,750 1,733 107 49 1,577

3,062 138 3,200 176 289 2,735 1,723 107 49 1,567

Appendix 6, page 5

Rice (Thai), 5 percent broken, milled, FOB Bangkok; Source: World Bank. 2000. Commodity Markets and the Developing Countries . Based on average price difference between Thai 5 percent and 25 percent brokens (1998-2000 quarterly data), World Bank, 2000. Freight and insurance to major Indonesian ports nearest project sites. Converted to paddy equivalent at 63 percent of milled rice, equivalent to the Indonesian term GKG: Gabah Kering Giling . World Bank. 1999. Indonesia:Essays on Agricultural Institutions and Policy .

Table A6.2: Urea - Financial and Economic Export Parity Prices (expressed in 2001 constant prices)
Item Urea, Eastern Europe FOB port of origin a (1990 constant) MUV multiplier1990 to 2001 constant prices Urea, FOB port of origin b (2001 constant) Freight & insurance to major Indonesian ports, 100% Urea, bagged, CIF Indonesian ports (2001 constant prices) Financial Prices in 2001 constant prices Urea, bagged, FOB Indonesian ports Handling, loading and port charges, 3% Ex-factory price Handling & transport to provincial wholesalers/distributors Wholesalers' margin, 7% Wholesale price Transport, loading and unloading costs to retailers Retailers' margin, 7% Transport to project sites, farmgate Farmgate price, urea, bagged 46% nitrogen content Economic Prices in 2001 constant prices Urea, bagged, FOB Indonesian ports Handling, loading, and port charges Ex-factory price Handling & transport to provincial wholesalers/distributors Wholesalers' margin Wholesale price Transport, loading, and unloading costs to retailers Retailers' margin Transport to project sites, farmgate Farmgate price, urea, bagged 46% nitrogen content
a c

Unit

1994

1995

1996

1997

1998 98.90

1999 81.10 88.24 40.00

2000 84.80 92.26 40.00

2001 91.90 99.99 40.00

$/ton 155.73 162.70 164.50 118.00 1.088

$/ton 169.43 177.02 178.98 128.38 107.60 $/ton 40.00 40.00 40.00 40.00 40.00

$/ton 209.43 217.02 218.98 168.38 147.60 128.24 132.26 139.99

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

2,309 69 2,240 190 170 2,600 98 189 49 2,935

2,393 72 2,321 190 176 2,686 98 195 49 3,028

2,414 72 2,342 190 177 2,709 98 196 49 3,052

1,856 56 1,801 190 139 2,130 98 156 49 2,432

1,627 49 1,579 190 124 1,892 98 139 49 2,178

1,414 42 1,371 190 109 1,670 98 124 49 1,941

1,458 44 1,414 190 112 1,716 98 127 49 1,990

1,543 46 1,497 190 118 1,805 98

47

133 49 2,084

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

2,309 62 2,247 171 153 2,571 88 170 44 2,872

2,393 65 2,328 171 158 2,657 88 175 44 2,964

2,414 65 2,349 171 159 2,679 88 177 44 2,988

1,856 50 1,806 171 125 2,102 88 140 44 2,375

1,627 44 1,583 171 111 1,866 88 125 44 2,123

1,414 38 1,376 171 98 1,645 88 111 44 1,888

1,458 39 1,419 171 101 1,691 88 114 44 1,937

1,543 42 1,502 171

Appendix 6, page 6

106 1,779 88 120 44 2,030

CIF = cost, insurance, and freight; FOB = free on board; kg = kilogram; MUV = manufacturing unit value. Urea (46% N), bagged, varying origins, FOB Eastern Europe. Source: World Bank. 2000. Commodity Markets and the Developing Countries .
b

Using an MUV multiplier to convert prices from 1990 to 2001 constant terms.

Source: Project Completion Report and Operations Evaluation Mission estimates.

Table A6.2 (continued) Item Urea, Eastern Europe f.o.b. port of origin a (1990 constant) MUV multiplier1990 to 2001 constant prices Urea, FOB port of origin (2001 constant) Freight & insurance to major Indonesian ports, c 100% Urea, bagged, CIF Indonesian ports (2001 constant prices) Financial Prices in 2001 constant prices Urea, bagged, FOB Indonesian ports Handling, loading and port charges, 3% Ex-factory price Handling & transport to provincial wholesalers/distributors Wholesalers' margin, 7% Wholesale price Transport, loading, and unloading costs to retailers Retailers' margin, 7% Transport to project sites, farmgate Farmgate price, urea, bagged 46% nitrogen content Economic Prices in 2001 constant prices Urea, bagged, FOB Indonesian ports Handling, loading and port charges Ex-factory price Handling & transport to provincial wholesalers/distributors Wholesalers' margin Wholesale price Transport, loading, and unloading costs to retailers Retailers' margin Transport to project sites, farmgate Farmgate price, urea, bagged 46% nitrogen content
a b

Unit $/ton 1.088

2002 98.50

2003 99.13

2004

2005

2006

2007

2008

2009

99.77 100.40 101.04 101.68 102.32 102.96

$/ton 107.17 107.86 108.55 109.24 109.93 110.63 111.32 112.02 $/ton 40.00 40.00 40.00 40.00 40.00 40.00 40.00 40.00 $/ton 147.17 147.86 148.55 149.24 149.93 150.63 151.32 152.02

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

1,623 49 1,574 190 123 1,887 98 139 49 2,172

1,630 49 1,581 190 124 1,895 98 139 49 2,181

1,638 49 1,589 190 124 1,903 98 140 49 2,189

1,645 49 1,596 190 125 1,911 98 141 49 2,198

1,653 50 1,603 190 126 1,919 98 141 49 2,206

1,661 50 1,611 190 126 1,927 98 142 49 2,215

1,668 50 1,618 190 127 1,935 98 142 49 2,223

1,676 50 1,626 190 127 1,943 98

48

143 49 2,232

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

1,623 44 1,579 171 111 1,861 88 125 44 2,117

1,630 44 1,586 171 112 1,868 88 126 44 2,126

1,638 44 1,594 171 112 1,876 88 126 44 2,134

1,645 44 1,601 171 112 1,884 88 127 44 2,142

1,653 45 1,608 171 113 1,892 88 127 44 2,151

1,661 45 1,616 171 113 1,900 88 128 44 2,159

1,668 45 1,623 171 114 1,908 88 128 44 2,168

1,676 45 1,631 171

Appendix 6, page 7

114 1,916 88 129 44 2,176

Urea (46% N), bagged, varying origins, FOB Eastern Europe. Source: World Bank. 2000. Commodity Markets and the Developing Countries . Using an MUV multiplier to convert prices from 1990 to 2001 constant terms.

Table A6.3: Phosphate - Financial and Economic Import Parity Prices (expressed in 2001 constant prices) Item TSP, FOB port of origin a (1990 constant) MUV multiplier TSP, FOB port of origin (2001constant) Freight & insurance to major Indonesian ports CIF at major Indonesian ports Financial Prices in 2001 constant prices CIF at major Indonesian ports Handling and port charges, 5.0% Handling & transport to provincial wholesalers/distributors Wholesalers' margin, 7.0% Wholesale price Transport, loading, and unloading costs to retailers Retailers' margin,7.0% Transport to project sites, farmgate Farmgate price, TSP 46% P Farmgate price, equivalent to superphosphate, 36% P Economic Prices in 2001 constant prices CIF at major Indonesian ports Handling and port charges Handling & transport to provincial wholesalers/distributors Wholesalers' margin Wholesale price Transport, loading, and unloading costs to retailers Retailers' margin Transport to project sites, farmgate Farmgate price, TSP 46% P Farmgate price, equivalent to superphosphate, 36% P
a b

Unit

1994

1995

1996

1997

1998

1999

2000

2001

$/ton 119.90 125.50 154.30 158.90 166.10 152.60 133.80 137.90 1.09 $/ton 130.45 136.54 167.88 172.88 180.72 166.03 145.57 150.04 $/ton 40.00 40.00 40.00 40.00 40.00 40.00 40.00 40.00 $/ton 170.45 176.54 207.88 212.88 220.72 206.03 185.57 190.04

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

1,879 94 163 150 2,285 98 167 49 2,599 2,034

1,946 97 163 154 2,361 98 172 49 2,679 2,097

2,292 115 163 180 2,749 98 199 49 3,095 2,422

2,347 117 163 184 2,811 98 204 49 3,161 2,474

2,433 122 163 190 2,908 98 210 49 3,265 2,555

2,271 114 163 178 2,726 98 198 49 3,070 2,403

2,046 102 163 162 2,473 98 180 49 2,799 2,190

2,095 105 163 165 2,528 98

49

184 49 2,858 2,237

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

1,879 85 146 135 2,245 88 150 44 2,527 1,977

1,946 88 146 139 2,319 88 155 44 2,606 2,039

2,292 103 146 162 2,703 88 179 44 3,014 2,359

2,347 106 146 166 2,765 88 183 44 3,080 2,410

2,433 110 146 171 2,861 88 189 44 3,182 2,490

2,271 102 146 161 2,681 88 178 44 2,990 2,340

2,046 92 146 146 2,430 88 162 44 2,724 2,132

2,095 94 146 149 2,485 88 165 44 2,782 2,177

Appendix 6, page 8

CIF = cost, insurance, and freight; FOB = free on board; kg = kilogram; MUV = manufacturing unit value; TSP = triple superphosphate. TSP (triple superphosphate 46% P), bulk, FOB US Gulf. Source: World Bank. 2000. Commodity Markets and the Developing Countries. Using an MUV multiplier to convert prices from 1990 to 1999 constant terms.

Source: Project Completion Report and Operations Evaluation Mission estimates.

Table A6.3 (continued) Item TSP, FOB port of origin a (1990 constant) MUV multiplier TSP, FOB port of origin (2001constant) Freight & insurance to major Indonesian ports CIF at major Indonesian ports Financial Prices in 2001 constant prices CIF at major Indonesian ports Handling and port charges, 5.0% Handling & transport to provincial wholesalers/distributors Wholesalers' margin, 7.0% Wholesale price Transport, loading, and unloading costs to retailers Retailers' margin,7.0% Transport to project sites, farmgate Farmgate price, TSP 46% P Farmgate price, equivalent to superphosphate, 36% P Economic Prices in 2001 constant prices CIF at major Indonesian ports Handling and port charges Handling & transport to provincial wholesalers/distributors Wholesalers' margin Wholesale price Transport, loading, and unloading costs to retailers Retailers' margin Transport to Project sites, farm gate Farmgate price, TSP 46% P Farmgate price, equivalent to superphosphate, 36% P
a b

Unit

2002

2003

2004

2005

2006

2007

2008

2009

$/ton 138.90 137.26 135.63 133.99 132.35 130.71 129.08 127.44 1.09 $/ton 151.12 149.34 147.56 145.78 144.00 142.22 140.43 138.65 $/ton 40.00 40.00 40.00 40.00 40.00 40.00 40.00 40.00 $/ton 191.12 189.34 187.56 185.78 184.00 182.22 180.43 178.65

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

2,107 105 163 166 2,541 98 185 49 2,873 2,248

2,087 104 163 165 2,519 98 183 49 2,849 2,230

2,068 103 163 163 2,497 98 182 49 2,825 2,211

2,048 102 163 162 2,475 98 180 49 2,802 2,193

2,029 101 163 160 2,453 98 179 49 2,778 2,174

2,009 100 163 159 2,431 98 177 49 2,754 2,156

1,989 99 163 158 2,409 98 175 49 2,731 2,137

1,970 98 163 156 2,387 98

50

174 49 2,707 2,119

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

2,107 95 146 150 2,498 88 166 44 2,796 2,188

2,087 94 146 148 2,476 88 165 44 2,773 2,170

2,068 93 146 147 2,454 88 163 44 2,750 2,152

2,048 92 146 146 2,432 88 162 44 2,726 2,134

2,029 91 146 144 2,411 88 161 44 2,703 2,115

2,009 90 146 143 2,389 88 159 44 2,680 2,097

1,989 90 146 142 2,367 88 158 44 2,657 2,079

1,970 89 146 141 2,345 88 157 44 2,633 2,061

Appendix 6, page 9

TSP (triple superphosphate 46% P), bulk, FOB US Gulf. Source: World Bank. 2000. Commodity Markets and the Developing Countries. Using an MUV multiplier to convert prices from 1990 to 1999 constant terms.

Table A6.4: Potassium Chloride - Financial and Economic Import Parity Prices (expressed in 2001 constant prices) Item KCL, FOB port of origin (1990 constant) MUV multiplier b KCL, FOB port of origin (2001 constant) Freight & insurance to major Indonesian ports CIF at major Indonesian ports Financial Prices in 2001 constant prices CIF at major Indonesian ports Handling and port charges, 5% Handling & transport to provincial wholesalers/distributors Wholesalers' margin, 7% Wholesale price Transport, loading, and unloading costs to retailers Retailers' margin, 7% Transport to project sites, farmgate Farmgate price, KCL Economic Prices in 2001 constant prices CIF at major Indonesian ports Handling and port charges Handling & transport to provincial wholesalers/distributors Wholesalers' margin Wholesale price Transport, loading, and unloading costs to retailers Retailers' margin Transport to project sites, farmgate Farmgate price, KCL
a b

Unit
a

1994

1995

1996

1997

1998

1999

2000

2001

$/ton 95.90 98.80 102.60 1.088 $/ton 104.34 107.49 111.63 $/ton 40.00 40.00 40.00 $/ton 144.34 147.49 151.63

107.50 112.20 114.50 115.40 114.00 116.96 122.07 124.58 125.56 124.03 40.00 40.00 40.00 40.00 40.00 156.96 162.07 164.58 165.56 164.03

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

1,591 1,626 1,672 1,730 1,787 1,814 1,825 1,808 80 81 84 87 89 91 91 90 163 163 163 163 163 163 163 163 128 131 134 139 143 145 146 144 1,962 2,001 2,052 2,118 2,182 2,213 2,225 2,206 98 98 98 98 98 98 98 98 144 147 150 155 160 162 163 161 49 49 49 49 49 49 49 49 2,252 2,294 2,349 2,420 2,487 2,521 2,534 2,513

51

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

1,591 1,626 1,672 1,730 1,787 1,814 1,825 1,808 72 73 75 78 80 82 82 81 146 146 146 146 146 146 146 146 116 118 121 125 128 130 131 130 1,925 1,963 2,014 2,079 2,142 2,173 2,185 2,166 88 88 88 88 88 88 88 88 130 132 135 140 144 146 146 145 44 44 44 44 44 44 44 44 2,186 2,227 2,281 2,351 2,417 2,450 2,463 2,443

Appendix 6, page 10

CIF = cost, insurance, and freight; FOB = free on board; KCL = potassium chloride; kg = kilogram; MUV = manufacturing unit value. Standard grade, spot FOB Vancouver. Source: World Bank. 2000. Commodity Markets and the Developing Countries . Using an MUV multiplier to convert prices from 1990 to 1999 constant terms.

Source: Project Completion Report and Operations Evaluation Mission estimates.

Table A6.4 (continued) Item

a KCL, FOB port of origin (1990 constant)

Unit

2002

2003

2004

2005

2006

2007

2008

2009

MUV multiplier KCL, FOB port of originb (2001 constant) Freight & insurance to major Indonesian ports CIF at major Indonesian ports Financial Prices in 2001 constant prices CIF at major Indonesian ports Handling and port charges, 5% Handling & transport to provincial wholesalers/distributors Wholesalers' margin, 7% Wholesale price Transport, loading, and unloading costs to retailers Retailers' margin, 7% Transport to project sites, farmgate Farmgate price, KCL Economic Prices in 2001 constant prices CIF at major Indonesian ports Handling and port charges Handling & transport to provincial wholesalers/distributors Wholesalers' margin Wholesale price Transport, loading, and unloading costs to retailers Retailers' margin Transport to project sites, farmgate Farmgate price, KCL
a b

$/ton 111.10 108.96 107.13 105.34 1.088 $/ton 120.88 118.55 116.56 114.61 $/ton 40.00 40.00 40.00 40.00 $/ton 160.88 158.55 156.56 154.61

103.45 101.59 99.77 97.98 112.55 110.53 108.55 106.60 40.00 40.00 40.00 40.00 152.55 150.53 148.55 146.60

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

1,774 1,748 1,726 1,705 1,682 1,660 1,638 1,616 89 87 86 85 84 83 82 81 163 163 163 163 163 163 163 163 142 140 138 137 135 133 132 130 2,167 2,138 2,113 2,089 2,064 2,039 2,014 1,990 98 98 98 98 98 98 98 98 159 156 155 153 151 150 148 146 49 49 49 49 49 49 49 49 2,472 2,441 2,414 2,389 2,361 2,334 2,308 2,282

52

Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg Rp/kg

1,774 1,748 1,726 1,705 1,682 1,660 1,638 1,616 80 79 78 77 76 75 74 73 146 146 146 146 146 146 146 146 128 126 124 123 122 120 119 117 2,127 2,099 2,075 2,051 2,025 2,001 1,976 1,953 88 88 88 88 88 88 88 88 143 141 139 138 136 135 133 132 44 44 44 44 44 44 44 44 2,402 2,372 2,346 2,320 2,293 2,267 2,241 2,216

Appendix 6, page 11

Standard grade, spot FOB Vancouver. Source: World Bank. 2000. Commodity Markets and the Developing Countries . Using an MUV multiplier to convert prices from 1990 to 1999 constant terms.

Table A6.5: Economic Project Costs in Constant 2001 Prices (Rp million) Subprojects 1991 1992 1993 1994 SCF 0.90 Taxes on Local Expenditures 10% Kulon Progo and Sermo Dam Civil Works Equipment and vehicles Consulting services Training EOM Subtotal South Kedu Civil Works Equipment and vehicles Consulting services Training EOM Subtotal Serayu and Ijo Tipar Civil Works Equipment and vehicles Consulting services Training EOM Subtotal Lower Citanduy Civil Works Equipment and vehicles Consulting services Training EOM Subtotal Telang-Saleh Civil Works Equipment and vehicles Consulting services Training EOM Subtotal Batang Anai Civil Works Equipment and vehicles Consulting services Training EOM Subtotal Wawotobi Civil Works Equipment and vehicles Consulting services Training EOM Subtotal Other Costs Civil Works Equipment and vehicles Consulting services Training Admin. & Supervision Subtotal Total 13,110 505 4,601 8 0 18,225 11,448 468 782 52 387 13,136 28,666 5,098 3,533 0 0 37,297 21,829 0 1,711 0 0 23,540 5,624 1,717 3,970 186 0 11,497 94,590 287 1,987 28 0 96,892 15,974 296 1,467 34 73 17,843 84 3,092 1,246 814 5,924 11,159 229,589 17,367 801 6,039 11 0 24,218 15,327 659 1,025 0 519 17,530 37,705 6,677 4,637 0 0 49,019 28,714 0 2,246 0 0 30,960 8,352 516 5,211 247 0 14,326 16,709 663 2,608 37 0 20,016 21,646 808 1,925 309 89 24,776 2,332 2,460 1,635 2,230 5,110 13,766 194,611 29,388 737 10,299 628 0 41,052 26,129 1,126 1,749 45 878 29,927 64,256 11,395 7,908 0 0 83,560 48,930 0 3,830 0 0 52,760 12,607 3,684 11,220 611 0 28,122 28,402 514 4,447 224 0 33,587 35,849 206 3,283 232 165 39,734 2,562 9,104 115,163 2,080 11,633 140,543 449,286 35,857 1,012 12,432 334 0 49,635 30,506 2,023 2,111 0 1,042 35,683 77,435 13,776 9,546 0 0 100,757 58,966 0 4,624 0 0 63,589 15,725 4,278 10,726 2,128 196 33,054 34,362 311 5,368 268 30 40,339 37,072 249 3,963 336 252 41,872 2,628 873 11,832 4,768 10,186 30,288 395,218

53

Appendix 6, page 12
1995 1996 Total

28,952 1,424 10,022 18 67 40,483 24,201 885 1,702 113 777 27,680 62,472 11,099 7,696 0 0 81,266 47,571 389 3,388 0 0 51,348 13,388 1,539 8,647 463 0 24,037 27,626 446 4,328 151 11 32,561 35,725 434 3,194 100 179 39,633 925 1,075 3,917 2,192 8,114 16,223 313,232

14,433 932 4,909 174 6 20,454 11,643 353 834 0 411 13,240 30,574 5,441 3,770 0 0 39,785 23,281 0 1,826 0 0 25,107 5,998 2,842 4,640 1,224 22 14,727 13,462 438 2,120 164 0 16,184 20,385 2,103 1,565 171 88 24,313 6,829 5,414 1,329 7,438 4,610 25,619 179,430

139,108 5,411 48,302 1,174 73 194,068 119,254 5,514 8,203 211 4,014 137,196 301,107 53,486 37,091 0 0 391,685 229,291 389 17,625 0 0 247,305 61,695 14,577 44,414 4,859 218 125,764 215,151 2,659 20,857 871 41 239,579 166,651 4,096 15,396 1,183 845 188,171 15,360 22,018 135,122 19,522 45,577 237,599 1,761,367

EOM = efficient operation and maintenance, SCF = standard conversion factor. Source: Project Completion Report and Operations Evaluation Mission estimates.

Table A6.6: Kulon Progo Schemes - Economic Internal Rate of Return, expressed in 2001 Constant Prices
Item Incremental Benefits Rice, before milling (GKG equivalent) Incremental farm gate economic value, 100% Incremental Costs a. Production Costs With Project Annual planted - irrigated area Annual planted - rainfed area Total Costs, 100% Without Project Annual planted - irrigated area a Annual planted - rainfed area Total Costs Incremental, excluding harvesting Incremental harvesting costs, % of harvest, 13% Incremental production costs b. Investment Costs Add a share of project-wide costs c. Operation and Maintenance Irrigation command area, with project Irrigation command area, without project Incremental irrigated area for O&M Incremental O&M Total Costs Net Benefits EIRR Net Present Value at 12 Percent
a b

Unit

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

tons Rp mn

3,158 5,400

19,197 34,159

25,928 37,906

27,316 39,202

ha/year ha/year Rp mn

9,808 1,573

9,808 1,573

9,808 1,573

9,808 1,573

9,808 1,573

9,808 1,573

10,240 1,505 22,454

12,724 1,386 26,864

13,884 990 27,881

13,884 990 27,759

ha/year ha/year Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

9,808 1,573

9,808 1,573

9,808 1,573

9,808 1,573

9,808 1,573

9,808 1,573

9,808 1,573 20,961 1,493 702 2,195

9,808 1,573 20,596 6,268 4,441 10,709

9,808 1,573 19,997 7,884 4,928 12,811

9,808 1,573 19,897 7,862 5,096 12,958

54

18,225 1,594

24,218 1,967

41,052 20,078

49,635 4,327

40,483 2,318

20,454 3,660

ha ha ha 135,000 Rp mn 95,000 Rp mn

6,328 6,328 0

6,328 6,328 0

6,328 6,328 0

6,328 6,328 0

6,328 6,328 0

6,328 6,328 0

6,400 6,328 72 990

6,525 6,328 197 1,005 11,714 22,445

6,942 6,328 614 1,056 13,867 24,039

6,942 6,328 614 1,056 14,014

19,819

26,184

61,130

53,962

42,801

24,114

3,185 2,216

Appendix 6, page 13

Rp mn (19,819) (26,184) (61,130) (53,962) (42,801) (24,114) 7.5% Rp mn (59,687)

25,188

EIRR = economic internal rate of return, GKG = Gabah Kering Giling, ha = hectare, KCL = potassium chloride, O&M = operation and maintenance. This is equivalent to physical areas multiplied by annual cropping intensities. Assuming an annual O&M provision of Rp135,000 per ha in constant 1999 prices from 1997 plus an estimated Rp440 million in O&M costs for the new Sermo dam. This O&M provision represents an increase of about Rp95,000 per ha from the O&M provision without the Project.

Source: Operations Evaluation Mission estimates.

Table A6.6 (continued) Item Unit 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 to 2020 Incremental Benefits Rice, before milling (GKG equivalent) Incremental farmgate economic value, 100% Incremental Costs a. Production Costs With Project Annual planted - irrigated area Annual planted - rainfed area Total Costs, 100% Without Project Annual planted - irrigated area Annual planted - rainfed area Total Costs Incremental, excluding harvesting Incremental harvesting costs, % of harvest, 13% Incremental production costs b. Investment Costs Add a share of project-wide costs c. Operation and Maintenance Irrigation command area, with project Irrigation command area, without project Incremental irrigated area for O&M Incremental O&M Total Costs Net Benefits
a b

tons Rp mn

27,316 39,786

27,316 40,269

27,316 41,476

27,316 42,682

27,316 43,888

27,316 43,615

27,316 43,341

27,316 43,068

27,316 42,794

27,316 42,521

ha/year 13,884 ha/year Rp mn 990 28,092

13,884 990 28,326

13,884 990 28,284

13,884 990 28,249

13,884 990 28,214

13,884 990 28,177

13,884 990 28,141

13,884 990 28,106

13,884 990 28,071

13,884 990 27,993

ha/year ha/year Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

9,808 1,573 20,114 7,978 5,172 13,150

9,808 1,573 20,261 8,065 5,235 13,300

9,808 1,573 20,229 8,055 5,392 13,447

9,808 1,573 20,202 8,047 5,549 13,596

9,808 1,573 20,174 8,039 5,705 13,745

9,808 1,573 20,146 8,031 5,670 13,701

9,808 1,573 20,118 8,023 5,634 13,658

9,808 1,573 20,090 8,015 5,599 13,614

9,808 1,573 20,063 8,008 5,563 13,571

9,808 1,573 20,005

55

7,988 5,528 13,516

ha ha ha 135,000 Rp mn 95,000 Rp mn Rp mn

6,942 6,328 614 1,056 14,206 25,580

6,942 6,328 614 1,056 14,355 25,914

6,942 6,328 614 1,056 14,503 26,973

6,942 6,328 614 1,056 14,652 28,030

6,942 6,328 614 1,056 14,801 29,087

6,942 6,328 614 1,056 14,757 28,858

6,942 6,328 614 1,056 14,713 28,628

6,942 6,328 614 1,056 14,670 28,398

6,942 6,328 614 1,056 14,627 28,167

6,942 6,328 614 1,056 14,571 27,950

Appendix 6, page 14

This is equivalent to physical areas multiplied by annual cropping intensities. Assuming an annual O&M provision of Rp135,000 per ha in constant 1999 prices from 1997 plus an estimated Rp440 million in O&M costs for the new Sermo dam. This O&M provision represents an increase of about Rp95,000 per ha from the O&M provision without the Project.

Table A6.7: South Kedu Schemes - Economic Internal Rate of Return, expressed in 2001 Constant Prices
Item Incremental Benefits Rice, before milling (GKG equivalent) Incremental farmgate economic value, 100% Incremental Costs a. Production Costs With Project Annual planted - irrigated area Annual planted - rainfed area Total Costs, 100% Without Project Annual planted - irrigated area Annual planted - rainfed area Total Costs Incremental, excluding harvesting Incremental harvesting costs, % of harvest, 13% Incremental production costs b. Investment Costs Add a share of project-wide costs c. Operation and Maintenance Irrigation command area, with project Irrigation command area, without project Incremental irrigated area for O&M Incremental O&M Total Costs Net Benefits EIRR Net Present Value at 12 Percent
b a a a a

Unit

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

tons Rp mn

10,923 16,163

12,703 20,844

25,187 45,649

26,829 45,875

26,829 47,742

26,829 39,224

26,829 38,503

ha/year ha/year Rp mn

47,636 0

49,552 0

51,469 0

53,933 0

54,206 0

54,480 0

54,754 0

54,754 0

54,754 0

54,754 0

113,081 115,336 118,244 111,942 109,641 106,108 105,636

ha/year ha/year Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

47,636 0

49,552 0

51,469 0

52,016 0

52,016 0

52,016 0

52,016 0

52,016 0

52,016 0 97,832 8,275 5,099 13,374

52,016 0 97,321 8,315 5,005 13,321

104,813 106,306 108,496 102,742 100,884 8,268 2,101 10,369 13,136 1,594 17,530 1,967 29,927 20,078 35,683 4,327 9,030 2,710 11,739 27,680 2,318 9,748 5,934 15,682 13,240 3,660 9,200 5,964 15,164 8,757 6,206 14,964

56

ha ha ha 135,000 Rp mn 95,000 Rp mn

27,377 27,377 0

27,377 27,377 0

27,377 27,377 0

27,377 27,377 0 2,341

27,377 27,377 0 2,341 44,077

27,377 27,377 0 2,341 34,923 10,726

27,377 27,377 0 2,341 17,504 28,370

27,377 27,377 0 2,341 17,305 30,437

27,377 27,377 0 2,341 15,715 23,509

27,377 27,377 0 2,341 15,661

14,731

19,496

50,005

52,720

Appendix 6, page 15

Rp mn (14,731) (19,496) (50,005) (36,557) (23,233) Percent Rp mn 12.6% 5,843

22,842

EIRR = economic internal rate of return, GKG = Gabah Kering Giling, ha = hectare, KCL = potassium chloride, O&M = operation and maintenance.
a b

This is equivalent to physical areas multiplied by annual cropping intensities. Assuming an annual O&M provision of Rp135,000 per ha in constant 2001 prices from 1994. This O&M provision represents an increase of about Rp95,000 per ha from the O&M provision without the Project.

Source: Operations Evaluation Mission estimates.

Table A6.7 (continued) Item Incremental Benefits Rice, before milling (GKG equivalent) Incremental farmgate economic value, 100% Incremental Costs a. Production Costs With Project Annual planted - irrigated area Annual planted - rainfed area Total Costs, 100% Without Project Annual planted - irrigated area Annual planted - rainfed area Total Costs Incremental, excluding harvesting Incremental harvesting costs, % of harvest, 13% Incremental production costs b. Investment Costs Add a share of project-wide costs c. Operation and Maintenance Irrigation command area, with project Irrigation command area, without project Incremental irrigated area for O&M Incremental O&M Total Costs Net Benefits
a b b a a a a

Unit

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010 to 2020

tons Rp mn

26,829 39,077

26,829 39,552

26,829 40,737

26,829 41,921

26,829 43,106

26,829 42,838

26,829 42,569

26,829 42,300

26,829 42,032

26,829 41,763

ha/year ha/year Rp mn

54,754 0

54,754 0

54,754 0

54,754 0

54,754 0

54,754 0

54,754 0

54,754 0

54,754 0

54,754 0

106,930 107,838 107,676 107,537 107,401 107,259 107,119 106,982 106,848 106,544

ha/year ha/year Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

52,016 0 98,429 8,502 5,080 13,582

52,016 0 99,178 8,660 5,142 13,802

52,016 0 99,013 8,663 5,296 13,959

52,016 0 98,870 8,667 5,450 14,117

52,016 0 98,730 8,671 5,604 14,275

52,016 0 98,584 8,675 5,569 14,244

52,016 0 98,440 8,679 5,534 14,213

52,016 0 98,299 8,683 5,499 14,182

52,016 0 98,161 8,687 5,464 14,151

52,016 0 97,861 8,683 5,429 14,112

57

ha ha ha 135,000 Rp mn 95,000 Rp mn Rp mn

27,377 27,377 0 2,341 15,922 23,154

27,377 27,377 0 2,341 16,143 23,409

27,377 27,377 0 2,341 16,300 24,437

27,377 27,377 0 2,341 16,457 25,464

27,377 27,377 0 2,341 16,616 26,490

27,377 27,377 0 2,341 16,585 26,253

27,377 27,377 0 2,341 16,554 26,015

27,377 27,377 0 2,341 16,523 25,777

27,377 27,377 0 2,341 16,492 25,540

27,377 27,377 0 2,341 16,453 25,310

Appendix 6, page 16

This is equivalent to physical areas multiplied by annual cropping intensities. Assuming an annual O&M provision of Rp135,000 per ha in constant 2001 prices from 1994. This O&M provision represents an increase of about Rp95,000 per ha from the O&M provision without the Project.

Table A6.8: Serayu Schemes - Economic Internal Rate of Return, expressed in 2001 Constant Prices
Item Incremental Benefits Rice, before milling (GKG equivalent) Incremental farmgate economic value, 100% Incremental Costs a. Production Costs With Project Annual planted - irrigated area Annual planted - rainfed area Total Costs, 100% Without Project Annual planted - irrigated area Annual planted - rainfed area Total Costs Incremental, excluding harvesting Incremental harvesting costs, % of harvest, 13% Incremental production costs b. Investment Costs Add a share of project-wide costs c. Operation and Maintenance Irrigation command area, with project Irrigation command area, without project Incremental irrigated area for O&M Incremental O&M Total Costs Net Benefits EIRR Net Present Value at 12 Percent
b a a a a

Unit

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

tons Rp mn

7,872 13,459

41,327 73,540

57,415 83,939

57,415 82,397

ha/year ha/year Rp mn

26,835 3,553

26,835 3,553

26,835 3,553

26,835 3,553

26,835 3,553

26,835 3,553

27,730 3,553 60,277

34,700 570 70,053

36,803 570 71,881

36,803 570 71,563

ha/year ha/year Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

26,835 3,553

26,835 3,553

26,835 3,553

26,835 3,553

26,835 3,553

26,835 3,553

26,835 3,553 56,589 3,687 1,750 5,437

26,835 3,553 55,598 14,456 9,560 24,016

26,835 3,553 53,971 17,910 10,912 28,822

26,835 3,553 53,698 17,865 10,712 28,576

58

37,297 1,594

49,019 1,967

83,560 20,078

100,757 4,327

81,266 2,318

39,785 3,660

ha ha ha 135,000 Rp mn 95,000 Rp mn Rp mn Percent Rp mn

17,890 17,890 0

17,890 17,890 0

17,890 17,890 0

17,890 17,890 0

17,890 17,890 0

17,890 17,890 0

17,890 17,890 0 1,980

21,030 17,890 3,140 2,361 26,377 47,163

21,030 17,890 3,140 2,361 31,183 52,756

21,030 17,890 3,140 2,361 30,937 51,460

38,891 (38,891) 8.4% (92,240)

50,985

103,638

105,084

83,584 (83,584)

43,445 (43,445)

7,417 6,043

(50,985) (103,638) (105,084)

Appendix 6, page 17

EIRR = economic internal rate of return, GKG = Gabah kering Giling, ha = hectare, KCL = potassium chloride, O&M = operation and maintenance.
a b

This is equivalent to physical areas multiplied by annual cropping intensities. Assuming an annual O&M provision of Rp135,000 per ha in constant 2001 prices from 1997. This O&M provision represents an increase of about Rp95,000 per ha from the O&M

provision without the Project. Barrage O&M is estimated at Rp500 million a year. Source: Operations Evaluation Mission estimates.

Table A6.8 (continued) Item Incremental Benefits Rice, before milling (GKG equivalent) Incremental farmgate economic value, 100% Incremental Costs a. Production Costs With Project Annual planted - irrigated area Annual planted - rainfed area Total Costs, 100% Without Project Annual planted - irrigated area a Annual planted - rainfed area Total Costs Incremental, excluding harvesting Incremental harvesting costs, % of harvest, 13% Incremental production costs b. Investment Costs Add a share of project-wide costs c. Operation and Maintenance Irrigation command area, with project Irrigation command area, without project Incremental irrigated area for O&M Incremental O&M Total Costs Net Benefits
a b

Unit

2001

2002

2003

2004

2005

2006

2007

2008

2009

tons Rp mn

57,415 83,624

57,415 84,640

57,415 87,176

57,415 89,712

57,415 92,247

57,415 91,672

57,415 91,098

57,415 90,523

57,415 89,948

ha/year ha/year Rp mn

36,803 570 72,436

36,803 570 73,048

36,803 570 72,938

36,803 570 72,845

36,803 570 72,753

36,803 570 72,657

36,803 570 72,563

36,803 570 72,471

36,803 570 72,380

ha/year ha/year Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

26,835 3,553 54,289 18,147 10,871 29,018

26,835 3,553 54,689 18,359 11,003 29,362

26,835 3,553 54,601 18,337 11,333 29,670

26,835 3,553 54,526 18,319 11,663 29,982

26,835 3,553 54,452 18,302 11,992 30,294

26,835 3,553 54,374 18,283 11,917 30,201

26,835 3,553 54,298 18,265 11,843 30,108

26,835 3,553 54,223 18,247 11,768 30,015

26,835 3,553 54,150 18,230 11,693 29,923

59

ha ha ha 135,000 Rp mn 95,000 Rp mn Rp mn

21,030 17,890 3,140 2,361 31,379 52,245

21,030 17,890 3,140 2,361 31,724 52,916

21,030 17,890 3,140 2,361 32,031 55,145

21,030 17,890 3,140 2,361 32,343 57,369

21,030 17,890 3,140 2,361 32,655 59,592

21,030 17,890 3,140 2,361 32,562 59,110

21,030 17,890 3,140 2,361 32,469 58,629

21,030 17,890 3,140 2,361 32,377 58,146

21,030 17,890 3,140 2,361 32,285 57,663

Appendix 6, page 18

This is equivalent to physical areas multiplied by annual cropping intensities. Assuming an annual O&M provision of Rp135,000 per ha in constant 2001 prices from 1997. This O&M provision represents an increase of about Rp95,000 per ha from the O&M provision without the Project. Barrage O&M is estimated at Rp500 million a year.

Table A6.9: Citanduy Schemes - Economic Internal Rate of Return, expressed in 2001 Constant Prices Item
Incremental Benefits Rice, before milling (GKG equivalent) Incremental farmgate economic value, 100% Incremental Costs a. Production Costs With Project Annual planted - irrigated area a Annual planted - rainfed area Total Costs, 100% Without Project Annual planted - irrigated area a Annual planted - rainfed area Total Costs Incremental, excluding harvesting Incremental harvesting costs, % of harvest, 13% Incremental production costs b. Investment Costs Add a share of project-wide costs c. Operation and Maintenance Irrigation command area, with project Irrigation command area, without project Incremental irrigated area for O&M Incremental O&M b Total Costs Net Benefits EIRR Net Present Value at 12 Percent
a a

Unit tons Rp mn

1991 0

1992 0

1993 0

1994 0

1995 0

1996 8,488 15,384

1997 28,185 48,192

1998 37,669 67,030

1999 47,345 69,217

2000 47,345 67,945

ha/year ha/year Rp mn

32,166 2,062

32,166 2,062

32,166 2,062

32,166 2,062

32,166 2,062

33,060 2,062 73,890

36,404 836 75,270

37,362 836 75,651

38,320 836 75,084

38,320 836 74,752

ha/year ha/year Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

32,166 2,062

32,166 2,062

32,166 2,062

32,166 2,062

32,166 2,062

32,166 2,062 69,230 4,660 2,000 6,660

32,166 2,062 65,614 9,656 6,265 15,921

32,166 2,062 64,446 11,205 8,714 19,919

32,166 2,062 62,528 12,555 8,998 21,554

32,166 2,062 62,207 12,545 8,833 21,378

60

23,540 1,594

30,960 1,967

52,760 20,078

63,589 4,327

51,348 2,318

25,107 3,660

ha ha ha 135,000 Rp mn
95,000

17,870 17,870 0

17,870 17,870 0

17,870 17,870 0

17,870 17,870 0

17,870 17,870 0

17,870 17,870 0

19,160 17,870 1,290 1,685 17,605 30,586

19,160 17,870 1,290 1,685 21,603 45,427

19,160 17,870 1,290 1,685 23,238 45,979

19,160 17,870 1,290 1,685 23,062 44,883

Rp mn

25,134

32,926

72,838

67,916

53,666

35,428

Rp mn (25,134) (32,926) (72,838) (67,916) (53,666) (20,043) Percent 11.8% Rp mn (3,272)

Appendix 6, page 19

EIRR = economic internal rate of return, GKG = Gabah kering Giling, ha = hectare, KCL = potassium chloride, O&M = operation and maintenance.
a b

This is equivalent to physical areas multiplied by annual cropping intensities. Assuming an annual O&M provision of Rp135,000 per ha in constant 2001 prices from 1996. This O&M provision represents an increase of about Rp95,000 per ha from the O&M provision without the Project.

Source: Operations Evaluation Mission estimates.

Table A6.9 (continued)

Item
Incremental Benefits Rice, before milling (GKG equivalent) Incremental farmgate economic value, 100% Incremental Costs a. Production Costs With Project Annual planted - irrigated area a Annual planted - rainfed area Total Costs, 100% Without Project Annual planted - irrigated area a Annual planted - rainfed area Total Costs Incremental, excluding harvesting Incremental harvesting costs, % of harvest, 13% Incremental production costs b. Investment Costs Add a share of project-wide costs c. Operation and Maintenance
a a

Unit

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010 to 2020 47,345 73,697

tons Rp mn

47,345 68,957

47,345 69,795

47,345 71,886

47,345 73,977

47,345 76,068

47,345 75,594

47,345 75,119

47,345 74,645

47,345 74,171

ha/year ha/year Rp mn

38,320 836 75,662

38,320 836 76,301

38,320 836 76,186

38,320 836 76,089

38,320 836 75,993

38,320 836 75,893

38,320 836 75,795

38,320 836 75,699

38,320 836 75,604

38,320 836 75,390

ha/year ha/year Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

32,166 2,062 62,903 12,759 8,964 21,723

32,166 2,062 63,374 12,926 9,073 22,000

32,166 2,062 63,271 12,916 9,345 22,261

32,166 2,062 63,182 12,907 9,617 22,524

32,166 2,062 63,094 12,899 9,889 22,788

32,166 2,062 63,002 12,891 9,827 22,718

32,166 2,062 62,912 12,883 9,765 22,648

32,166 2,062 62,824 12,875 9,704 22,579

32,166 2,062 62,737 12,867 9,642 22,509

32,166 2,062 62,549 12,841 9,581 22,422

61

ha Irrigation command area, without project ha Incremental irrigated area for O&M ha b Incremental O&M 135,000 Rp mn
Irrigation command area, with project 95,000 Total Costs Net Benefits
a b

19,160 17,870 1,290 1,685 23,408 45,549

19,160 17,870 1,290 1,685 23,684 46,111

19,160 17,870 1,290 1,685 23,945 47,941

19,160 17,870 1,290 1,685 24,209 49,768

19,160 17,870 1,290 1,685 24,473 51,595

19,160 17,870 1,290 1,685 24,403 51,191

19,160 17,870 1,290 1,685 24,333 50,786

19,160 17,870 1,290 1,685 24,263 50,382

19,160 17,870 1,290 1,685 24,194 49,977

19,160 17,870 1,290 1,685 24,106 49,591

Appendix 6, page 20

Rp mn Rp mn

This is equivalent to physical areas multiplied by annual cropping intensities. Assuming an annual O&M provision of Rp135,000 per ha in constant 2001 prices from 1996. This O&M provision represents an increase of about Rp95,000 per ha from the O&M provision without the Project.

Table A6.10: Telang-Saleh Schemes - Economic Internal Rate of Return, expressed in 2001 Constant Prices
Item Incremental Benefits Rice, before milling, GKG equivalent Incremental farmgate economic value, 100% Incremental Costs a. Production Costs With Project Annual planted, phase 1 rainfed areaa Annual planted, outside phase I - rainfed a Total Costs, 100% Without Project Annual planted, phase 1 rainfed areaa Annual planted, outside phase I - rainfed a Total Costs Incremental, excluding harvesting Incremental harvesting costs, % of harvest, 13% Incremental production costs b. Investment Costs Project-wide costs c. Operation and Maintenance Drainage command area, phase I Incremental O&M Total Costs Net Benefits EIRR Net Present Value at 12 Percent
b

Unit

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

tons Rp mn

3,182 4,708

3,182 5,221

3,711 6,727

3,711 6,346

6,893 12,266

10,075 14,729

10,604 15,219

ha/yr ha/yr Rp mn

5,296 21,226

5,296 21,226

5,296 21,226

5,296 21,226 25,518

5,296 21,226 25,706

5,296 21,226 26,004

5,296 21,226 24,706

5,296 21,226 24,483

5,296 21,226 24,092

5,296 21,226 24,007

ha/yr ha/yr Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

5,296 21,226

5,296 21,226

5,296 21,226

5,296 21,226 24,040 1,478 612 2,090

5,296 21,226 24,201 1,505 679 2,183 24,037 2,318

5,296 21,226 24,467 1,538 874 2,412 14,727 3,660

5,296 21,226 23,887 819 825 1,644

5,296 21,226 23,708 775 1,595 2,370

5,296 21,226 23,377 716 1,915 2,630

5,296 21,226 23,297 710 1,978 2,688

62

11,497 1,594

14,326 1,967

28,122 20,078

33,054 4,327

120,000

ha ha

6,620 26,532

6,620 26,532

6,620 26,532

6,620 26,532

6,620 26,532

6,620 26,532 663

6,620 26,532 663 2,307 4,039

6,620 26,532 663 3,033 9,233

6,620 26,532 663 3,293 11,436

6,620 26,532 2,068 4,756 10,462

Drainage command area, outside phase I 48,000

20,000 Rp mn Rp mn 13,091 16,293 48,200 39,471 28,538

21,462

Rp mn (13,091) (16,293) (48,200) (34,763) (23,317) (14,736) 4.0% Rp mn (61,267)

Appendix 6, page 21

EIRR = economic internal rate of return, GKG = Gabah kering Giling, ha = hectare, KCL = potassium chloride, O&M = operation and maintenance.
a b

This is equivalent to physical areas multiplied by annual cropping intensities. Assuming an incremental annual O&M provision of Rp120,000 per ha in constant 1999 prices from year 2000 for phase I area. For outside phase I area, incremental O&M is assumed at Rp 48,000/ha from year 2000. Incremental O&M from 1996 to 2001 is estimated not to exceed Rp 20,000/ha for the entire area.

Source: Operations Evaluation Mission estimates.

Table A6.10 (continued) Item Incremental Benefits Rice, before milling, GKG equivalent Incremental farmgate economic value, 100% Incremental Costs a. Production Costs With Project Annual planted, phase 1 rainfed areaa Annual planted, outside phase I - rainfed a Total Costs, 100% Without Project Annual planted, phase 1 rainfed areaa Annual planted, outside phase I - rainfed a Total Costs Incremental, excluding harvesting Incremental harvesting costs, % of harvest, 13% Incremental production costs b. Investment Costs Project-wide costs c. Operation and Maintenance Drainage command area, phase I Incremental O&M Total Costs Net Benefits
a b b

Unit

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010 to 2020

tons Rp mn

10,604 15,445

10,604 15,633

10,604 16,101

10,604 16,570

10,604 17,038

10,604 16,932

10,604 16,826

10,604 16,719

10,604 16,613

10,604 16,507

ha/yr ha/yr Rp mn

5,296 21,226 24,148

5,296 21,226 24,243

5,296 21,226 24,223

5,296 21,226 24,205

5,296 21,226 24,187

5,296 21,226 24,169

5,296 21,226 24,151

5,296 21,226 24,133

5,296 21,226 24,115

5,296 21,226 24,093

ha/yr ha/yr Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

5,296 21,226 23,416 732 2,008 2,740

5,296 21,226 23,494 750 2,032 2,782

5,296 21,226 23,475 748 2,093 2,841

5,296 21,226 23,458 747 2,154 2,901

5,296 21,226 23,441 746 2,215 2,961

5,296 21,226 23,424 745 2,201 2,946

5,296 21,226 23,407 744 2,187 2,931

5,296 21,226 23,390 743 2,173 2,917

5,296 21,226 23,373 742 2,160 2,902

5,296 21,226 23,340 753 2,146 2,899

63

120,000

ha ha

6,620 26,532 2,068 4,808 10,637

6,620 26,532 2,068 4,850 10,783

6,620 26,532 2,068 4,909 11,192

6,620 26,532 2,068 4,969 11,601

6,620 26,532 2,068 5,029 12,009

6,620 26,532 2,068 5,014 11,918

6,620 26,532 2,068 4,999 11,827

6,620 26,532 2,068 4,984 11,735

6,620 26,532 2,068 4,970 11,643

6,620 26,532 2,068 4,967 11,540

Drainage command area, outside phase I 48,000

20,000 Rp mn Rp mn Rp mn

Appendix 6, page 22

This is equivalent to physical areas multiplied by annual cropping intensities. Assuming an incremental annual O&M provision of Rp120,000 per ha in constant 1999 prices from year 2000 for phase I area. For outside phase I area, incremental O&M is assumed at Rp 48,000/ha from year 2000. Incremental O&M from 1996 to 2001 is estimated not to exceed Rp 20,000/ha for the entire area.

Table A6.11: Batang Anai Schemes - Economic Internal Rate of Return, expressed in 2001 Constant Prices Item
Incremental Benefits Rice, before milling, GKG equivalent Incremental farmgate economic value, 100% Incremental Costs a. Production Costs With Project Annual planted, phase 1 rainfed area Total Costs, 100% Without Project Annual planted, phase 1 rainfed area Total Costs Incremental, excluding harvesting Incremental harvesting costs, % of harvest, 13% Incremental production costs b. Investment Costs Add a share of project-wide costs c. Operation and Maintenance Irrigation command area, with project Irriation command area, without project Incremental O&M
b a a

Unit

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

tons Rp mn

2,400 4,350

17,180 29,375

22,355 39,780

26,518 38,768

25,685 36,861

Annual planted, outside phase I - rainfeda

ha/yr ha/yr Rp mn

4,800 1,919

4,800 1,919

4,800 1,919

4,800 1,919

4,800 1,919

4,800 1,919 11,530

8,100 684 15,869

8,325 684 15,985

8,325 684 15,483

8,325 684 15,400

Annual planted, outside phase I - rainfeda

ha/yr ha/yr Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

4,800 1,919

4,800 1,919

4,800 1,919

4,800 1,919

4,800 1,919

4,800 1,919 9,986 1,544 565 2,110

4,800 1,919 9,580 6,289 3,819 10,108

4,800 1,919 9,456 6,529 5,171 11,700

4,800 1,919 9,228 6,255 5,040 11,295

4,800 1,919 9,178

64

6,221 4,792 11,013

96,892 1,594

20,016 1,967

33,587 20,078

40,339 4,327

32,561 2,318

16,184 3,660

ha ha 135,000 ha 95,000 Rp mn Rp mn Rp mn

3,200 3,200 0

3,200 3,200 0

3,200 3,200 0

3,200 3,200 0

3,200 3,200 0

3,200 3,200 0 274 22,228

4,500 3,200 1,300 432 10,539 18,836

4,500 3,200 1,300 432 12,132 27,648

4,500 3,200 1,300 432 11,726 27,042

4,500 3,200 1,300 432

Appendix 6, page 23

Total Costs Net Benefits EIRR

98,486

21,983

53,665

44,666

34,879

11,445 25,416

Net Present Value at 12 Percent

(98,486) (21,983) (53,665) (44,666) (34,879) (17,878) 3.1% Rp mn (119,647)

EIRR = economic internal rate of return, GKG = Gabah kering Giling, ha = hectare, KCL = potassium chloride, O&M = operation and maintenance.
a b

This is equivalent to physical areas multiplied by annual cropping intensities. Assuming an annual O&M provision of Rp125,000 per ha in constant 1999 prices from 1996. This O&M provision represents an increase of about Rp85,000 per ha from the O&M provision without the Project.

Source: Operations Evaluation Mission estimates.

Table A6.11 (continued) Item

Incremental Benefits Rice, before milling, GKG equivalent Incremental farmgate economic value, 100% Incremental Costs a. Production Costs With Project Annual planted, phase 1 rainfed area Total Costs, 100% Without Project Annual planted, phase 1 rainfed area Total Costs Incremental, excluding harvesting Incremental harvesting costs, % of harvest, 13% Incremental production costs b. Investment Costs Add a share of project-wide costs c. Operation and Maintenance Irrigation command area, with project Irriation command area, without project Incremental O&M
b a a a

Unit

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010 to 2020 13,468 20,964

tons Rp mn

24,296 35,387

22,928 33,800

21,581 32,768

20,255 31,649

18,950 30,447

17,666 28,207

16,403 26,026

15,161 23,903

13,940 21,839

Annual planted, outside phase I - rainfeda

ha/yr ha/yr Rp mn

8,220 684 15,394

8,115 684 15,326

8,010 684 15,110

7,905 684 14,899

7,800 684 14,688

7,695 684 14,477

7,590 684 14,267

7,485 684 14,058

7,380 684 13,850

7,275 684 13,620

Annual planted, outside phase I - rainfed

ha/yr ha/yr Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

4,800 1,919 9,260 6,134 4,600 10,734

4,800 1,919 9,312 6,014 4,394 10,408

4,800 1,919 9,297 5,813 4,260 10,073

4,800 1,919 9,283 5,615 4,114 9,730

4,800 1,919 9,270 5,418 3,958 9,376

4,800 1,919 9,257 5,221 3,667 8,887

4,800 1,919 9,243 5,024 3,383 8,407

4,800 1,919 9,230 4,828 3,107 7,936

4,800 1,919 9,217 4,633 2,839 7,472

4,800 1,919 9,191

65

4,429 2,725 7,154

ha ha 135,000 ha 95,000 Rp mn Rp mn Rp mn

4,500 3,200 1,300 432 11,166 24,221

4,500 3,200 1,300 432 10,840 22,960

4,500 3,200 1,300 432 10,505 22,263

4,500 3,200 1,300 432 10,161 21,488

4,500 3,200 1,300 432 9,807 20,640

4,500 3,200 1,300 432 9,319 18,888

4,500 3,200 1,300 432 8,839 17,187

4,500 3,200 1,300 432 8,367 15,536

4,500 3,200 1,300 432 7,904 13,935

4,500 3,200 1,300 432 7,586 13,378

Appendix 6, page 24

Total Costs Net Benefits

GKG = Gabah kering Giling, ha = hectare, KCL = potassium chloride, O&M = operation and maintenance.
a b

This is equivalent to physical areas multiplied by annual cropping intensities. Assuming an annual O&M provision of Rp125,000 per ha in constant 1999 prices from 1996. This O&M provision represents an increase of about Rp85,000 per ha from the O&M provision without the Project.

Table A6.12: Wawotobi Schemes - Economic Internal Rate of Return, expressed in 2001 Constant Prices Item Incremental Benefits Rice, before milling, GKG equivalent Incremental farmgate economic value, 100% Incremental Costs a. Production Costs With Project Annual planted irrigated areaa Annual planted, rainfed areaa Total Costs , 100% Without Project Annual planted, irrigated areaa Annual planted, rainfed areaa Total Costs Incremental, excluding harvesting Incremental harvesting costs, % of harvest, 13% Incremental production costs b. Investment Costs Add a share of project-wide costs Operation and Maintenance Irrigation command area, with project Irrigation command area, without project Incremental irrigated area for O&M Incremental O&M b Total Costs Net Benefits EIRR Net Present Value at 12 Percent Unit tons Rp mn 1991 0 1992 0 1993 0 1994 1,015 1995 2,030 3,330 1996 5,499 9,967 1997 19,726 33,729 1998 23,241 41,357 1999 27,930 40,833 2000 29,321 42,079

ha/yr ha/yr Rp mn

10,148 0

10,148 0

10,148 0

10,148 0

10,148 0 19,529

10,475 0 20,600

13,113 0 24,336

13,510 0 24,591

13,907 0 24,498

13,907 0 24,362

ha/yr ha/yr Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

10,148 0

10,148 0

10,148 0

10,148 0

10,148 0 16,357 3,172 433 3,605

10,148 0 16,691 3,909 1,296 5,205 24,313 3,660

10,148 0 15,980 8,356 4,385 12,741

10,148 0 15,767 8,824 5,376 14,201

10,148 0 15,362 9,137 5,308 14,445

10,148 0 15,267 9,095 5,470 14,565

66

17,843 1,594

24,776 1,967

39,734 20,078

41,872 4,327

39,633 2,318

c.

ha ha ha Rp mn Rp mn

6,547 6,547 0

6,547 6,547 0

6,547 6,547 0

6,547 6,547 0

6,547 6,547 0

6,547 6,547 0 560 33,737

7,947 6,547 1,400 730 13,471 20,258

7,947 6,547 1,400 730 14,931 26,426

7,947 6,547 1,400 730 15,175 25,658

7,947 6,547 1,400 730

Appendix 6, page 25

19,437

26,743

59,812

46,199

45,556

15,295 26,784

Rp mn (19,437) (26,743) (59,812) (46,199) (42,226) (23,770) 9.0% Rp mn (38,339)

EIRR = economic internal rate of return, GKG = Gabah kering Giling, ha = hectare, KCL = potassium chloride, O&M = operation and maintenance.
a b

This is equivalent to physical areas multiplied by annual cropping intensities. Assuming an annual O&M provision of Rp125,000 per ha in constant 1999 prices from 1996. This O&M provision represents an increase of about Rp85,000 per ha from the O&M provision without the Project.

Source: Operations Evaluation Mission estimates.

Table A6.12 (continued) Item Incremental Benefits Rice, before milling, GKG equivalent Incremental farmgate economic value, 100% Incremental Costs a. Production Costs With Project Annual planted irrigated areaa Annual planted, rainfed areaa Total Costs , 100% Without Project Annual planted, irrigated areaa Annual planted, rainfed areaa Total Costs Incremental, excluding harvesting Incremental harvesting costs, % of harvest, 13% Incremental production costs b. Investment Costs Add a share of project-wide costs Operation and Maintenance Irrigation command area, with project Irrigation command area, without project Incremental irrigated area for O&M Incremental O&M b Total Costs Net Benefits
a b

Unit

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010 to 2020 29,321 45,641

tons Rp mn

29,321 42,705

29,321 43,224

29,321 44,519

29,321 45,814

29,321 47,109

29,321 46,815

29,321 46,522

29,321 46,228

29,321 45,935

ha/yr ha/yr Rp mn

13,907 0 24,658

13,907 0 24,858

13,907 0 24,814

13,907 0 24,776

13,907 0 24,738

13,907 0 24,699

13,907 0 24,661

13,907 0 24,623

13,907 0 24,586

13,907 0 24,506

ha/yr ha/yr Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

10,148 0 15,411 9,246 5,552 14,798

10,148 0 15,502 9,356 5,619 14,975

10,148 0 15,474 9,340 5,787 15,128

10,148 0 15,449 9,327 5,956 15,283

10,148 0 15,424 9,314 6,124 15,438

10,148 0 15,399 9,300 6,086 15,386

10,148 0 15,374 9,287 6,048 15,335

10,148 0 15,349 9,274 6,010 15,283

10,148 0 15,325 9,261 5,972 15,232

10,148 0 15,276 9,230 5,933 15,163

67

c.

ha ha ha Rp mn Rp mn Rp mn

7,947 6,547 1,400 730 15,528 27,177

7,947 6,547 1,400 730 15,705 27,519

7,947 6,547 1,400 730 15,858 28,661

7,947 6,547 1,400 730 16,013 29,801

7,947 6,547 1,400 730 16,168 30,941

7,947 6,547 1,400 730 16,116 30,699

7,947 6,547 1,400 730 16,065 30,457

7,947 6,547 1,400 730 16,013 30,215

7,947 6,547 1,400 730 15,962 29,973

7,947 6,547 1,400 730 15,893 29,748

Appendix 6, page 26

This is equivalent to physical areas multiplied by annual cropping intensities. Assuming an annual O&M provision of Rp125,000 per ha in constant 1999 prices from 1996. This O&M provision represents an increase of about Rp85,000 per ha from the O&M provision without the Project.

Table A6.13: Overall Project - Economic Internal Rate of Return, expressed in 2001 Constant Prices Item Unit 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

Incremental Benefits Total incremental rice production (GKG equiv.) Kulon Progo South Kedu Serayu Lower Citanduy Telang-Saleh Batang Anai Wawotobi Subtotal 100%

tons Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0 0

15,120 0 16,163 0 0 4,708 0 0 20,871

17,914 0 20,844 0 0 5,221 0 3,330 29,395

45,286 0 45,649 0 15,384 6,727 4,350 9,967 82,078

106,662 5,400 45,875 13,459 48,192 6,346 29,375 33,729 182,377

177,511 34,159 47,742 73,540 67,030 12,266 39,780 41,357 315,875

222,039 37,906 39,224 83,939 69,217 14,729 38,768 40,833 324,617

224,516 39,202 38,503 82,397 67,945 15,219 36,861 42,079 322,205

68

Incremental Costs - Production, O&M and Investments Kulon Progo Rp mn South Kedu Rp mn Serayu Rp mn Lower Citanduy Rp mn Telang-Saleh Rp mn Batang Anai Rp mn Wawotobi Rp mn Subtotal 100% Rp mn Total Net Benefits EIRR NPV at 12 percent Rp mn Rp mn

19,819 14,731 38,891 25,134 13,091 98,486 19,437 229,589

26,184 19,496 50,985 32,926 16,293 21,983 26,743 194,611

61,130 50,005 103,638 72,838 48,200 53,665 59,812 449,286

53,962 52,720 105,084 67,916 39,471 44,666 46,199 410,019

42,801 44,077 83,584 53,666 28,538 34,879 45,556 333,101

24,114 34,923 43,445 35,428 21,462 22,228 33,737 215,337

3,185 17,504 7,417 17,605 2,307 10,539 13,471 72,028 110,348

11,714 17,305 26,377 21,603 3,033 12,132 14,931 107,094 208,780

13,867 15,715 31,183 23,238 3,293 11,726 15,175 114,199 210,418

14,014 15,661 30,937 23,062 4,756 11,445 15,295 115,171 207,034

Appendix 6, page 27

(229,589) (194,611) (449,286) (389,147) (303,706) (133,260) 8.3% (368,609)

EIRR = economic internal rate of return, GKG = Gabah kering Giling, NPV = net present value, O&M = operation and maintenance. Source: Operations Evaluation Mission estimates.

Table A6.13 (continued) Item

Unit

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010 to 2020

Incremental Benefits Total incremental rice production (GKG equiv.) Kulon Progo South Kedu Serayu Lower Citanduy Telang-Saleh Batang Anai Wawotobi Subtotal 100%

tons Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn Rp mn

223,127 39,786 39,077 83,624 68,957 15,445 35,387 42,705 324,980

221,759 40,269 39,552 84,640 69,795 15,633 33,800 43,224 326,913

220,412 41,476 40,737 87,176 71,886 16,101 32,768 44,519 334,663

219,086 42,682 41,921 89,712 73,977 16,570 31,649 45,814 342,325

217,781 43,888 43,106 92,247 76,068 17,038 30,447 47,109 349,903

216,497 43,615 42,838 91,672 75,594 16,932 28,207 46,815 345,673

215,234 43,341 42,569 91,098 75,119 16,826 26,026 46,522 341,501

213,992 43,068 42,300 90,523 74,645 16,719 23,903 46,228 337,386

212,771 42,794 42,032 89,948 74,171 16,613 21,839 45,935 333,332

212,298 42,521 41,763 89,373 73,697 16,507 20,964 45,641 330,466

69

Incremental Costs - Production, O&M and Investments Kulon Progo Rp mn South Kedu Rp mn Serayu Rp mn Lower Citanduy Rp mn Telang-Saleh Rp mn Batang Anai Rp mn Wawotobi Rp mn Subtotal 100% Rp mn Total Net Benefits Rp mn

14,206 15,922 31,379 23,408 4,808 11,166 15,528 116,417 208,563

14,355 16,143 31,724 23,684 4,850 10,840 15,705 117,301 209,612

14,503 16,300 32,031 23,945 4,909 10,505 15,858 118,051 216,612

14,652 16,457 32,343 24,209 4,969 10,161 16,013 118,804 223,521

14,801 16,616 32,655 24,473 5,029 9,807 16,168 119,549 230,354

14,757 16,585 32,562 24,403 5,014 9,319 16,116 118,755 226,918

14,713 16,554 32,469 24,333 4,999 8,839 16,065 117,972 223,529

14,670 16,523 32,377 24,263 4,984 8,367 16,013 117,197 220,189

14,627 16,492 32,285 24,194 4,970 7,904 15,962 116,433 216,899

14,571 16,453 32,164 24,106 4,967 7,586 15,893 115,740 214,726

Appendix 6, page 28

70

Appendix 6, page 28

Table A6.14: EIRR Comparison with Appraisal and PCR Estimates and Sensitivity Analysis Incremental Production Costs 10% lower (1) 8.3 15.0 9.3 13.1 5.3 3.7 9.7 8.8 Rice Prices 10% higher (2) 8.5 13.5 9.4 12.9 9.8 4.0 10.0 9.5 Incremental Crop Yields 10% higher (3) 8.5 13.5 9.4 12.9 4.8 4.0 10.0 9.5

Subprojecta

Appraisal Estimates

PCR

OEM Base Case

Total (1)(2)(3) 10.0 16.3 11.2 14.9 6.7 5.3 11.5 10.9

Kulon Progo South Kedu Serayu Lower Citanduy Batang Anai Telang-Saleh Wawatobi Overall Project

19.8 15.4 17.3 11.6 15.9

15.1 14.0 10.5 14.7 13.7 10.8 16.0 13.4

7.5 12.6 8.4 11.8 3.1 4.0 9.0 8.3

= not available, EIRR = economic internal rate of return, OEM = Operations Evaluation Mission, PCR = project completion report. These subprojects were formally approved after loan effectiveness and not included in the appraisal economic analysis.

71
FOLLOW-UP ACTIONS Action Responsible for Action

Appendix 7, page 1

Responsible for Monitoring

Timing

South Kedu Subproject Implement a semiannual program of sediment monitoring for Wadaslintang Reservoir. Last monitoring was reportedly 10 years ago. Serayu Bogowonto River Basin Project Directorate General of Water Resources Development (DGWRD) and provincial water resources service (PWRS) PWRS By June 2002

Reestablish full operational capacity of the Water Operations Center (WOC) of Wadaslintang river basin and integrate WOC with the relevant Balai (Regional Water Resources Planning Center). Serayu and Ijo-Tipar Subproject Initiate a routine procedure to ensure regular inspections of Serayu Barrage by qualified technical inspectors.

Serayu Bogowonto River Basin Project

By June 2002

DGWRD Bintek

Indonesia Resident Mission (IRM)

Immediatecontinue based on government guidelines

Provide backup to control mechanisms for Serayu Barrage. Replace missing hardware, reinstall software on the second computer, obtain reproducable barrage operations software on CD-ROM, and upgrade computers.

Central Java Irrigation Project (CJIP)

DGWRD

Missing hardware immediate Softwareimmediate Computerswithin two years

Check current capacity of Cilacap primary canal and resurvey as built section of Sumpiuh primary canal at BS 24. Restore Sumpiuh primary canal to final design levels from BS 24 to end (affecting about 1,500 ha). Heighten bridges that impede flow along the Cilacap primary canal. Complete water supply canal system for Cilacap (land already acquired, construction under bidding).

CJIP

DGWRD and PWRS

Immediate

CJIP

DGWRD and PWRS

By end 2002

CJIP

DGWRD and PWRS

By end 2002

PDAM (drinking water company owned by the regional government)

DGWRD and PWRS

By end 2002

Lower Citanduy Subproject Prepare river basin masterplan for Citanduy. Project Induk Citanduy Project Induk Citanduy DGWRD and IRM By end 2002

Complete drainage and flood prevention works under the Segara Anakan loan in the SidarejaCihaur irrigation project.

DGWRD and IRM

By loan closing

72
Action Responsible for Action IRM

Appendix 7, page 2
Responsible for Monitoring IRM Timing

Review the status of catchment interventions under the Segara Anakan loan and the status of implementation of recommendations made under TA 2665-INO. Wawotobi Subproject Review the water balance on Wawotobi subprojects and reassess potential area for irrigation in order to rationalize land development plans and irrigation system operations. Batang Anai Subproject Collect current population, landownership, and land use figures for the phase I area; and prepare, based on September 1993 Soil Survey Report of the Rural Development Corporation, et al., a water management, and community development plan for the S3/N1 and N2 marginally and currently not suitable land classification areas covering 3,804 ha. Prepare a maintenance program for drains in the lower project area. General Actions Review current policy and implementation of irrigation monitoring and evaluation (M&E). Initiate dialogue with provinces and districts aimed at standardizing key parameters to provide appropriate time-bound M&E information for irrigation sector planners and managers. Conduct an inventory and replace and/or restore to working order all flap gates on main and secondary drains for all three Central Java subprojects and Wawotobi. Conduct an inventory and replace and/or restore to working order all tidal embankments, regulatory structures, and flap gates on secondary drains for Telang-Saleh. Issue formal certificates of landownership to all affected farmers in Telang-Saleh, Wawotobi, and Lower Citanduy subprojects.

By September 2002

PWRS

Binlak Timur

By end 2001

West Java Provincial Water Resources Service (PISB)

IRM

By March 2002

PISB

DGWRD and PRWS

By March 2002

DGWRD Bintek

IRM

By March 2002

Provincial Irrigation Projects (PIPs)

DGWRD Binlak and PWRS

By end 2003

PWRS

DGWRD Binlak

By end 2003

National Land Board (BPN)/ Directorate General for Regional Development (BANGDA)

IRM

By March 2002

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Action Responsible for Action PIPs

Appendix 7, page 3
Responsible for Monitoring BANGDA Timing

Conduct an inventory, restore, construct, and maintain service roads for all main canal and drainage systems for all subprojects, utilizing ongoing donor-assisted project funds to the extent possible. Ensure that adequate O&M budgets are allocated and released for all subprojects according to needs-based budget assessments by DWRS. ADB requirements for audited financial statements have not been fully met. All project executing agencies are required to comply with Article IV, Section 4.06(b) of the Loan Agreement, and submit all outstanding audited annual financial statements. Review the status of irrigation sector reform under WATSAL and how it may affect operations in Indonesia.

Inventoryend 2001 Restoreend 2002 Constructend 2003 Maintainannually

Kabupatan BAPPEDA and DWRS

IRM/ DGWRD/BANGDA

Annually starting in FY2002.

DGWRD, DGFCH, and Directorate General of Regional Development IRM

IRM

Immediate

IRM

By March 2002