PROJECT INFORMATION DOCUMENT (PID) CONCEPT STAGE Public Disclosure Copy Report No.: PIDC644 Project Name Neeranchal National Watershed Project (P132739) Region SOUTH ASIA Country India Sector(s) General agriculture, fishing and forestry sector (50%), Agricultural extension and research (50%) Lending Instrument Specific Investment Loan Project ID P132739 Borrower(s) Department of Economic Affairs Implementing Agency Government of India, Ministry of Rural Development Environmental B-Partial Assessment Category Date PID Prepared 23-Oct-2012 Estimated Date of 15-Oct-2013 Appraisal Completion Estimated Date of 19-Dec-2013 Board Approval Concept Review Decision Public Disclosure Copy I. Introduction and Context Country Context Compared to most developing countries and many developed countries, India’s economy has performed well over the past several years. High rates of investment and savings, and strong export growth have generated substantial public resources for an expanding number of national development programs to improve social, economic and environmental conditions for the rural poor. Despite significant progress however, India still has the largest number of poor people in the world, and faces daunting development challenges. More than 400 million people still subsist on under US$1.25/day, with the majority living in rural areas and dependent on agriculture or other land-based resources for their major source of livelihood. Sectoral and Institutional Context Of the 127 agro-climatic zones in India, 73 are rainfed. These areas are also characterized by constraints in water availability that impacts on agriculture, livestock and household needs. Lower population densities and topography in these areas often make access to markets, employment, and other services more challenging. Dry regions are more susceptible to drought and deepening environmental stress and degradation. Poverty rates are consistently high in rainfed areas. Agriculture accounts for around 16 percent of Indian Gross Domestic Product (GDP). From the total area under agricultural production in India of 141 million hectares, approximately 68 percent Page 1 of 7 are under rainfed cultivation, mostly in arid and semi-arid areas. Almost half of India’s food crop area, over two-thirds of the non-food crop area, and more than half of all horticulture is rainfed. To meet national nutritional needs under moderate forecasts of population growth, an additional 102 Public Disclosure Copy million tons of food grains need to be produced annually by 2020. While perhaps 64 million tons of this food could come from increasing the area under irrigation and improving irrigation productivity, the balance (38 million tons) must come from either rainfed lands or imports. India’s major gains in food production have largely been from irrigated plains and deltas; rainfed regions have lagged far behind and have experienced severe resource degradation due to inappropriate land use, poor husbandry and low investments. Longer-term climate change adds another worrying dimension. Climate change requires new adaptation measures by farmers, especially small and marginal farmers who are the most vulnerable to these forecast impacts. Watershed management can provide a constructive framework to address these kinds of challenges facing rural India, for example by recharging local aquifers and improving downstream water flows; decreasing soil erosion; increasing agricultural productivity; and helping farmers adapt to climate change. The Integrated Watershed Management Program (IWMP) financed through the Department of Land Resources (DoLR), currently forms the cornerstone of the Government of India (GoI’s) support to watershed development, covering 27 states. In moving forward to improve the IWMP model and execution, a number of key issues outlined recently by the Planning Commission and various other reports/experts, have been identified. Besides the IWMP, there are a number of other centrally financed schemes related to watershed management, agriculture, and rural livelihoods, which to varying degrees address development needs in rainfed areas. Of these, the largest central scheme delivering watershed inputs is Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), also known by the operational program, the National Rural Employment Guarantee Scheme (MGNREGS ). At field level, MGNREGS has experienced major problems with delivering soil and water conservation works within a science-based micro-watershed planning framework, ensuring interventions are targeted in the most appropriate locations within the watershed, and the quality and sustainability of the physical assets created Relationship to CAS Public Disclosure Copy The project is closely linked with the Country Assistance Strategy 2009-2012. It will address four key priorities of: a) improving low agricultural productivity by improving the efficiency of government watershed programs to deliver increased yields in the agriculture sector; b) making development sustainable by reducing environmental degradation, improving water management, and helping farmers better adapt to climate change; and c) engaging with lagging states by focusing resources in five of India's seven lagging states, which also contain a significant share of rainfed agricultural areas; and d) engaging with the center by providing support to underpin policy and institutional reform and to improve the implementation of the central government Integrated Watershed Management Program on the ground. II. Proposed Development Objective(s) Proposed Development Objective(s) (From PCN) The proposed Project Development Objective is to “improve watershed management results in selected states by strengthening the national capacity for policy development, planning, implementation, and monitoring of IWMP, and convergence with other programs�. Key Results (From PCN) a) Policy and institutional reform in MoRD to support improved financial, administrative and technical convergence between IWMP, MGNREGS, and other related programs for integrated Page 2 of 7 development in selected rainfed watersheds; b) Strengthened capacities and new approaches and tools in DoLR, state watershed agencies, local authorities, and village-level stakeholders to plan, implement and monitor watershed programs; Public Disclosure Copy c) Stronger science-base for watershed management by integrating hydrology and climate variability into IWMP planning and implementation; and d) Improved systems for generating and transferring innovations and decision support information to address the needs of small and marginal farmers in project watersheds. The proposed project would strengthen coordination and improve the effectiveness of large public investments from the IWMP; support the introduction of more holistic watershed planning at a larger scale for better program convergence, especially between IWMP and MGNREGS; strengthen quality oversight arrangements to improve sustainability of physical investments; build required human resource and institutional capacities at both MoRD and DoLR in the centre, within state watershed agencies, and in communities and local authorities; support more targeted research and development to provide new tools and systems, and a stronger scientific basis for watershed management; strengthen extension services for technology transfer to farmers; promote climate smart agriculture; introduce better tools for hydrological assessment and monitoring a different scales; and improve M&E systems. Bank financing would be concentrated on specific technical support activities, goods and incremental costs. The Bank would not finance physical works. The GoI share of project investments would be through planned IWMP investments. III. Preliminary Description Concept Description The proposed project has five components with a total estimated cost of US$521 million over seven years. The project would be co-financed by the GoI (US$276 million or 53%) and the Bank (US $245 million or 47%). State level activities would largely focus on rainfed areas in: Andhra Pradesh, Chhattisgarh, Gujarat, Odisha , Jharkhand, Madhya Pradesh, Maharashtra, and Rajasthan. Public Disclosure Copy Component 1: Central Institutional and Human Capacity Building (US$25 million). The component would strengthen the capability of key national watershed institutions, particularly the DoLR and NRAA. Capacity building will focus on specialized technical and management skills to more effectively plan, coordinate, deliver, and monitor integrated watershed programs; undertake relevant policy and economic analyses; develop national watershed strategies; and report on national progress. Capacity building will include training and exposure visits to other countries. Institutional building will support the development of a single body within MoRD to facilitate coordination between IWMP and other national schemes impacting on watershed development, particularly MGNREGS. Legal and policy support will include reviewing and reforming existing legal/policy frameworks to better enable community based organizations (CBOs) to play a stronger regulatory role in the use of natural resources. It also includes support for regular review, analysis, and revision of relevant policies and guidelines governing watershed management, for example the Common Guidelines for Watershed Development. The component would also strengthen monitoring and evaluation (M&E) systems within DoLR and NRAA for tracking the national performance of IWMP and other watershed related programs. Component 2: National Human Capacity Building (US$40 million). In all states implementing IWMP, specialized training would be provided to State Level Nodal Agencies (SLNAs) and other designated watershed implementing agencies to strengthen technical skills around more holistic Page 3 of 7 watershed and broader natural resource management, and rural livelihoods. Capacity building would also strengthen administrative and management capabilities. Incremental training (beyond what is currently offered in IWMP) would also be provided to village level extension agents, community Public Disclosure Copy institutions, Gram Panchayat members, watershed committees, and farmers around improved watershed management practices, intensified agriculture, surface and groundwater management, climate change adaptation, value addition and marketing, etc. The component will help establish a national training program to develop certified watershed professionals at the state and community level. Within communities, special emphasis would be given to lead farmers to become certified watershed practitioners as champions and peer-to-peer mentors to other farmers. Capacity building would encompass a range of approaches including classroom training, formal courses, mentoring, and exposure visits within India and to other countries as appropriate, based on needs assessments and followed by impact assessments. Component 3: National Innovation Support (US$44 million). The component would support improved coordination and networking of relevant government scientific institutions (for example, the Indian Council of Agricultural Research – ICAR), NGOs involved with research and development (R&D), and other national R&D organization related to watershed management, both from within India and globally. This would underpin development and adoption of innovative knowledge, tools and systems to improve watershed planning, program implementation, agricultural intensification, water management, and livelihoods. Specific support would include: i) strategic planning to identify and generate a consensus on: critical research priorities for improved watershed development and agree on a pathway forward; individual agency contributions to the R&D agenda from both within the ICAR network and externally; institutional arrangements for coordinating and delivering necessary watershed-re lated R&D knowledge and products, technology transfer and dissemination systems; and maintaining research quality; ii) financing applied “action� research across agreed, key thematic priority areas ; iii) developing a national level data center in DoLR or NRAA, linked with emerging state data bases (see component 4); and iv) improving in-house M&E systems in each state that could then be networked at the national level. Public Disclosure Copy Component 4: IWMP Implementation Support in Focal States (US$363 million). In the proposed eight focal states, the component would provide intensive support for improved IWMP operations and convergence/integration with other relevant sectors and schemes. It would be linked directly to planned and sanctioned IWMP field operations in specific areas. Component assistance would include: i) strengthening a single nodal agency responsible for integrated watershed management, which would facilitate convergence of schemes and programs; ii) implementation of integrated catchment assessment and planning processes with a particular focus on broader hydrology and integrated catchment development at a scale of up to 25,000 ha; strengthening micro-watershed planning and implementation under IWMP to incorporate larger-scale catchment assessment/ planning guidance; developing and piloting forest and soil carbon financing schemes that would benefit communities and farmers ; piloting the use of new decision-support models for more holistic planning at both landscape-scale catchment and micro-watershed scales, and better site selection; iii) developing comprehensive digital data bases for improved integrated watershed management planning, pulling together available state-level data, images, and map layers, and establishing a land resources portal for wider data access by stakeholders such as other state government departments and universities. The state level data bases would be linked to the proposed national data base in DoLR; and iv) piloting community-based monitoring and documentation through simple water monitoring equipments and IT tools as well as training on participatory M&E and water management . Page 4 of 7 Component 5: Project Implementation Support (US$49 million). This component would support: i) incremental, specialized staff costs (both full and part-time) in the national Project Management Public Disclosure Copy Unit (PMU) in DoLR, and strengthening existing implementing agencies in the eight focal states to implement the project activities; ii) incremental administration costs for travel, creating and managing an integrated project website and improved communications; financial management and internal/external audit, and procurement; and equipment to support overall project implementation; iii) a comprehensive communication program to ensure wide awareness about the project objectives and lessons, and foster stakeholder engagement in the continuous improvement of the project; iv) 3rd party M&E support directly tied to project activities, including baseline surveys, input and output monitoring, process monitoring, impact assessments, acquisition of necessary remote sensing images, and case studies to guide project implementation. At this early stage of preparation, the project is rated as Category B and only triggers the safeguards for Environmental Assessment (OP/BP 4.01) and Indigenous Peoples (OP/BP 4.10). None of the project activities will a have direct bearing on the Bank’s safeguard policy on involuntary resettlement. The project design focuses the Bank’s investments on technical services, goods, and incremental costs; the Bank is not directly financing any field investments, such as water and soil conservation works, constructing check dams, erosion prevention structures, or buildings. Instead, the project will support institutional development, generation and adoption of new and innovative technology for watershed planning, and training and capacity building of stakeholders. At the same time, the project is designed to improve the capacity of DoLR and watershed institutions in participating states to better address safeguards in their IWMP. As a safeguard instrument, the DoLR will prepare a Strategic Environmental and Social Assessment (SESA) for the watershed sector to identify any key as well as residual environmental and social impacts and potential mitigation measures. The SE SA will also suggest an institutional framework for managing the environmental and social risks of the project as well as IWMP. It will also include Public Disclosure Copy plans to enhance capacity building of Panchayat Raj Institutions (PRIs) as well as establishing Social Developmentand Grievance Redress Cells in participating states and in DoLR. The SESA will also include a generic Environment and Social Management Plan (ESMP) including measures to monitor performance and compliance. The ESMP will particularly focus on measures to help the IWMP mitigate and monitor Environmental Health and Safety (EHS) aspects during construction of works in line with the World Bank EHS guidelines. The SESA will also be supported by development of an Environmental Codes of Practice to improve overall environmental sustainability for the anticipated project sub-activities. Sub-watershed assessments/plans are more technical in nature, while micro-watershed planning is more socially oriented. One of the key social challenges that the project’s strategy and implementation will seek to address is strengthening IWMP to improve local participation and inclusion of vulnerable groups, equity, and transparency. This would require mobilizing and training individuals and institutions at different levels, from community to state to national level. A second challenge is addressing limited capacity in state and Central agencies delivering watershed projects, particularly around program convergence and adopting new processes for watershed management. Sector-related institutions will be strengthened with an explicit capacity, composition, and a definite mandate, with strong emphasis on accountability and service delivery performance. Given the fact that some of the selected states contain tribal populations, the team will ensure the DoLR prepares an Indigenous People Development Framework (IPDF) including guidance to ensure and monitor Page 5 of 7 Free, Prior and Informed Consultation based on broad community support in project areas. On the environmental side, the main issues would be to: (i) ensure mainstreaming of sustainable Public Disclosure Copy environmental practices at the watershed level through convergence of various schemes; and (ii) develop technical capacity to arrest land degradation, reduce soil erosion and improve groundwater status by positively influencing the watershed hydrology. IV. Safeguard Policies that might apply Safeguard Policies Triggered by the Project Yes No TBD Environmental Assessment OP/BP 4.01 ✖ Natural Habitats OP/BP 4.04 ✖ Forests OP/BP 4.36 ✖ Pest Management OP 4.09 ✖ Physical Cultural Resources OP/BP 4.11 ✖ Indigenous Peoples OP/BP 4.10 ✖ Involuntary Resettlement OP/BP 4.12 ✖ Safety of Dams OP/BP 4.37 ✖ Projects on International Waterways OP/BP 7.50 ✖ Projects in Disputed Areas OP/BP 7.60 ✖ V. Tentative financing Financing Source Amount BORROWER/RECIPIENT 276.00 International Development Association (IDA) 245.00 Public Disclosure Copy Total 521.00 VI. Contact point World Bank Contact: Grant Milne Title: Sr Natural Resources Mgmt. Spec. Tel: 458-8425 Email: gmilne@worldbank.org Borrower/Client/Recipient Name: Department of Economic Affairs Contact: Mr. Sanjay Garg Title: Director Tel: 91-11-23092345 Email: sgarg@nic.in Implementing Agencies Page 6 of 7 Name: Government of India, Ministry of Rural Development Contact: Dr. Savita Anand Title: Joint Secretary Public Disclosure Copy Tel: 24362396 Email: jswm-dolr@nic.in VII. For more information contact: The InfoShop The World Bank 1818 H Street, NW Washington, D.C. 20433 Telephone: (202) 458-4500 Fax: (202) 522-1500 Web: http://www.worldbank.org/infoshop Public Disclosure Copy Page 7 of 7